Independent News & Media (INM) has revised down its 2009 operating profit forecasts due to the extremely challenging business environment.
However, its shares were 15 per cent up in Dublin this afternoon after the company said it was optimistic of reaching ageement with bondholders on refinancing a €200 million debt. This bond was due to have matured on May 18th before a standstill agreement extending the deadline until June 26th was reached.
At 3.15 pm the stock was trading at 28 cent giving it a market capitalisation of €236 million.
Negotiations with bond holders had shown a willingness to “reach consensus” and that while the outcome is “subject to material uncertainty” the board believed an agreement will be reached, INM chairman Brian Hillery said in a statement.
In statement before its annual general meeting held in Dublin this afternoon, Mr Hillery said the company expects operating profits pre-exceptionals in the range of €180 million to €210 million.
This is lower than a forecast of €200 million to €230 million made at the end of April.
Mr Hillery the revised forecasts were predicated on there being no further deterioration in advertising conditions. The group remained “profitable and cash generative” and its media franchises meant it was well-placed to benefit from a return to economic growth, he said.
INM also said that as part of its deleveraging it expected to dispose of INM outdoor and its stakes in German price comparison website Verivox and UK-based gaming business Cashcade, for a total consideration of €150 million.
However, these sales are not expected to be completed until September.
INM shareholder Denis O’Brien said today he remains supportive of the company’s management team and will vote in favour of all resolutions at today's annual meeting.
“We are fast approaching the deadline for resolving issues with bondholders, a deadline that has been moved once already."
“In order that all interested parties have clarity, I hope the issue is resolved without delay and a sensible deal can be done,” he said.
INM publishes a number of national and regional newspapers in Ireland including the Irish Independent, Sunday Independentand Evening Heraldand Belfast Telegraph.
