Blog Post

Earnings: Grows Online, But Over Tenth Of Revenue Will Disappear

Business directory group Yell is still not making enough from the web to offset falling ad sales in its printed Yellow Pages, but its 2008 earnings were worsened by currency fluctuations and debt charges, and the next few months look tough in the daunting classifieds market…

Yellow Pages: In the nine months to December 31, Yell’s infamous printed directory here in the UK, which publishes 76 regional editions, lost 9.4 percent of its revenue, down to £367.4 million, and 9.2 percent of its advertisers, down to 287,000. Online, got 20.5 percent more income at £122.3 million and 4.8 percent more advertisers at 217,000, while monthly unique users grew to 40.3 million through yet another redesign. The bottom line is, Yell is managing to convert more printed advertisers to its website, but it’s still not quite enough to pick up the slack – though the customer base is approaching the size of Yell’s printed base, the online ads are much cheaper, accounting for 15 percent of group income.

Overall in the UK, Yell saw a 3.7 percent revenue dip to £507.7 million. Group-wide, however, revenue was up seven percent to £1.65 billion – despite its Yellowbook US operation losing five percent of its print income, online sales there ballooned 107.4 percent to $165.5 million. Group pre-tax profit was 2.4 percent lower at £518.7 million.

The outlook is for organic revenue to dip by 12 percent for the three months to March 31. CEO John Condron: “The economic trends in each of our markets show no current sign of returning to growth … We have deliberately reduced focus on chasing new customers, because typically the loyalty rates … are significantly lower and because prospecting for new customers is more effective when the economy is stable or growing.”


(Photo: sbisson)