Thursday, September 18, 2008

Centaur Starts to Feel the Pinch

Cenatur media announced its yearly results today. Revenues flat year on year and a small improvement in margin resulting from cost savings. Also made clear is that the second half has been ugly, with an 8% drop in print revenues.

I can't see how there won't be a material fall in profits this year. As the employment market loosens up recruitment revenues will crash. Print advertising in the financial sector is hardly going to be a growth sector. The share price languishes at less then 60p, valuing the business at around £80m or just four times adjusted earnings. The future drop in profits is already factored into the share price, but shareholders have a long wait for recovery and in the current debt market thinning hopes of a private equity saviour.

Expect swathes of cost cutting as the business tries to catch up with the downward revenue trend.

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