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Future Sees 61% Profit Drop As U.S. Market Disappoints
by Staff [PC, Console/PC]
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November 26, 2009
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Game and specialty media magazine and website company Future PLC (Official PlayStation Magazine, GamesRadar) has announced a 6% revenue decrease but 61% profit slump for the year, with the U.S. magazine and advertising market particularly affected.
Overall for the year ended September 30th, revenues reached £153.1 million ($252.5 million), down 6% year on year, but pretax profits dipped a much larger 61% to £3.7m ($6.1 million).
The company operates many of the major game magazine titles in the UK, as well as websites such as GamesRadar and C&VG, and also runs Official PlayStation and Xbox magazines and Nintendo Power in the U.S., alongside the new World Of Warcraft magazine.
Future revealed "robust UK performance", with improved margin and earnings up 5%, but a U.S. performance that "reflects further caution on estimates for unprecedented newsstand disruption as well as generic advertising weakness." In addition, with U.S. revenue down 22%, the division as a whole dipped to a loss.
While the firm is expanding into online markets, Future as a whole sees online markets bringing in 23% of advertising, up from 19% in 2008, but still a significant minority.
Future's CEO Stevie Spring commented of the results: "The year was a tale of two markets. Our larger UK business out-performed the market, increasing profits despite a relatively modest revenue decline. Our U.S. business experienced a very difficult year – hit by a general advertising market in freefall and unprecedented disruption at newsstand."
She added: "Our immediate priorities in 2010 are to carry through the measures we’ve introduced to strengthen our U.S. business, and to navigate the near-term global economic challenges. Trading for the new financial year has continued to be challenging, both in the UK and the US and we expect conditions to remain difficult in 2010. So we’re taking a cautious view."
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