Yell Group’s online advertising is growing at a good pace but it’s still not enough to offset the losses from its printed Yellow Pages classified directory books. For the year to March 31, the group made online revenues 38 percent higher year-on-year, meaning online now accounts for 15 percent of total revenues — but Yell saw overall revenues drop 4.6 percent at constant currency rates to £2.39 million while profits dropped four percent year on year to £320.6 million. On top of that, Yell took a massive £1.37 billion impairment charge for the year, including a £1.27 billion goodwill write-down on the value of its Yell Publicidad printed ad book business in Spain and Latin America.
— Yell.com:: In the UK, Yell.com made online revenues of £164.5 million, a 18.2 percent lift year on year, but its list of advertising clients hasn’t grown since February and it still has 217,000, despite unique users growing by a quarter year on year to 10.2 million a month. Online now contributes 24 percent of the group’s UK revenues compared with 19 percent a year ago and perhaps Yell’s recent decision to start cross-selling ads to Google will see even faster online growth this year. More after the jump…
— Yellow pages: The UK’s big yellow book, which has 113 editions, made 10.9 percent less revenue year on year at £504.4 million while the number of advertisers dropped 10 percent to 390,000. CFO John Davis admits the online revenue increase “has largely been offset by the downward pressure on print revenues”, but Yell is staying true to its printed directories and says “print continues to deliver huge value to our customers”. Overall, UK revenues were 5.9 percent down on 2007/8 at £692.1 million while EBITDA was up 2.3 percent to £266.7 million thanks to cost-cutting
— Yell in the downturn: Like most media companies, Yell pleads that the economic downturn was “worse than anyone expected” and says customers are still “displaying significant caution” when it comes to buying ads. That’s why the company predicts a 11 percent drop in revenue for the three months to June 30. But Davis is keen to stress that the business is planning to shave £250 million from its cost base — £150 milllion has already gone — which is the equivalent of 20 percent of costs. Yell admits its ability to stay within its banking covenants could be affected by “future trading conditions” though it thinks it will have enough cashflow to make payments. However, Davis tells Reuters.com that the company is “looking at all options” to have refinancing in place by April 2010.
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