Last year was not a good one for Axel Springer AG, one of Europe’s biggest publishers. The biggest failure was the attempt to get into the mail-delivery business. Springer had to give up when the German government decided on a minimum wages for the postal industry. Then, for Springer, the mail sector no longer appeared viable. (That’s the beauty of this mail-delivery job: as long as you are forbidden to have legion of “working poor” in your plants, it is not worth it). This lead to a massive write-off and Springer lost E288m last year.
Quoted by Bloomberg, CEO Mathias Doepfner said Springer will focus on businesses that don’t depend on political decisions; he mentioned Internet and foreign businesses as expansion areas. Problem is: these two segments didn’t perform well last year either for Springer. In France, the group lost E40-50m in a failed venture to launch an ambitious daily. (As usual, French publishers applied pressure on the government. This turned to pressure on Springer, which gave up. It worked). And on the Internet front, Springer acquired 68% of AuFeminin.com, Europe biggest women’s site, for 32 euros per share. Unfortunately, Q1 results for Aufeminin.com yielded a 29% drop in profit. The share tumbled to less than 20 euros, close to its 2000 IPO level. A tougher competitive environment is cited as the cause.
Springer’s stock is now trading at 72 euros, a 50% drop from its all time high in February 2007.
Axel Springer AG controls 170 newspapers and websites and magazines in 33 countries.
Related columns:
- Lagardère acquiring Doctissimo Groupe Lagardère is acquiring the majority of the health specialized website Doctissimo. Lagardère Active Digital will get 53% of the capital and 58% of the voting rights of Doctissimo for about E70m that valued the company at E138m. By paying a 7.4% premium over the share price, and a multiple of 12 times the 2007 [...]...
- US newspapers: Worst drop in ad revenue in 57 years 2007 was the worst year in terms of print ad revenue for American newspapers since record keeping began in 1950. Here are the main facts & figures to bear in mind from the Newspaper Association of America’s last report (tables here ) - Print advertising plunged 9.4% to $42.2bn from $46.6bn in 2006 - Losses [...]...
- UK’s CityAM : profit and expansion The free business newspaper CityAM is growing slowly but steadily. Its circulation is now close to 102,000 copies, a 47% increase since its launch in September 2005, and it could now expand out of London. Financially, CityAM made a 59,000 Euros profit for the six months ended in March, on revenues of 4,4m Euros for [...]...
