Absolute Radio optimistic despite revenues falling by a third

Absolute Radio has posted a 32.7% drop in revenue and a 62% hike in pre-tax losses for the 12 months to 31 December 2009, as the impact of the UK advertising recession made its mark on its annual report today (5 October).

Absolute Radio: aspires to break even in 2011
Absolute Radio: aspires to break even in 2011

TIML Radio, a wholly owned subsidiary of The Times Group, (the publishers of The Times of India and The Economic Times), reported losses on ordinary activities before taxation of £4.3m, up 62.2% year on year from losses of £2.7m in 2008.

It confirms a tough trading period for the Indian media giant that bought Virgin Radio, as it was known, on 30 June 2008 for £55.06m. The station rebranded as Absolute Radio on 29 September 2008.

The impairment charged in arriving at the group result for the year was £7.9m and the carrying value of goodwill at 31 December 2009 was £34.98m. Fellow radio operator Global Radio made a charge of £193.5m for the year to March 2009.

However, Absolute Radio's chief executive Donnach O’Driscoll said the station aspired to break even during 2011 and remained optimistic about equalling Virgin Radio’s audience and total listening hours in the coming months.

O’Driscoll said: "From our perspective, 2009 and 2010 were building years. The heavy lifting has now been done. There are two points we keep making internally and they are ‘context’ and ‘environment’.

"We launched Absolute Radio within 90 days of owning the company and then we went into the worst recession in living memory. It’s very important to understand that – we never thought the business would be profitable from day one."

Although Absolute Radio has seen marked audience decline since the rebrand in September 2008, it has started to pull listeners back and in the second quarter of this year saw an increase in hours and listeners quarter on quarter.

According to the Q2 2010 Rajar figures, Absolute Radio had an average weekly reach of 1.59 million listeners, down 33.9% from Virgin Radio in the second quarter of 2008, but up 13.2% quarter on quarter.

Following the quarter two audience figures, O’Driscoll said ad revenues at Absolute were expected to be up 20% year on year for the month of September, against a national advertising market that was down an estimated 3% year on year.

A spokeswoman for Absolute Radio declined to comment on how ad revenues in September 2010 compared with September 2008.

O’Driscoll said both advertisers and agencies had supported the brand, despite reported audience declines, over the past two years. "No one walked away from us," he said.

Absolute Radio now uses its overall Rajar figure, which includes its digital stations such as Absolute 80s, for trading purposes, and now positions itself as a "mobile and entertainment audio brand", rather than a radio station.

In addition to Absolute Radio and its four branded digital services, Absolute Radio has more than 40 smartphone applications.

O’Driscoll said: "We want to produce as much creative content as possible and we want them to be accessible to as many people as possible."

TIML Radio reduced costs by £5.6m, or 22.5%, during 2009, which it said was part of a "targeted programme of cost-containment measures" to reduce overheads while preserving the core product.

The Absolute Radio management board do not sit on the parent company board of directors, which O’Driscoll said was in line with other Times of India Group subsidiaries.

The directors of TIML Radio are Ravindra Dhariwal, Sanjeev Shah, Amba Preetham Parigi and Oliver Guy Blackaby.

In 2008, turnover at TIML was down 8.2% year on year to £22m and the company's loss of £2.7m before tax was a sharp decline from 2007, when Virgin Radio made a £3.8m profit.

Have your say...

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus
Media Week Jobs
Search for more media jobs

Latest

Lost in translation: when brand taglines don't travel

Lost in translation: when brand taglines don't travel

These might be some of the most memorable brand taglines in English but when they cross oceans, they mean something entirely different. We searched the depths of the internet to find the best, or worst.

Share
Traditional TV viewers predicted to drop as mobile fuels rise in online video

Traditional TV viewers predicted to drop as mobile fuels rise in online video

Linear TV viewing figures are set to drop worldwide for the first time next year, with online video consumption set to rise by 23.3 per cent in 2015, according to a report by ZenithOptimedia.

Share
The 7 deadly sins of brand management - and how to avoid them

The 7 deadly sins of brand management - and how to avoid them

Some of the most valuable assets a firm has are the brands it has developed. Brands create identification, differentiation and value for customers and shareholders alike. By influencing customer choice, creating a loyal and passionate following as well as commanding a premium for their products and services, strong brands can be key to great business performance.

Share

Get news by email