A slowdown in advertising spend in the economy is expected to impact the topline of Mid-Day Multimedia Ltd during the current fiscal.
Turnover for the year 2001-2002 is expected to decline to around Rs 93 crore. This will be three per cent lower compared with the previous year's turnover of Rs 96.29 crore (2000-2001), which was 81 per cent higher compared with 1999-2000 turnover of Rs 53.25 crore.
The company has been projecting a topline growth of 30-40 per cent. However, the flat trend in advertising revenues and high newsprint prices during the fiscal are expected to pull down the turnover.
The company, which publishes Mumbai's leading eveninger, Mid-Day, has been resorting to cost-cutting. Operating margins for the company's print business have improved despite the decline in advertising spend. However, its outdoor business has been impacted due to a large fixed cost structure.
The outdoor business includes a contract with BEST for advertising and a 50:50 joint venture with a Chennai- based outdoor advertising company. In Mumbai's Rs 180- crore outdoor advertising market, Mid-Day currently has an estimated one million square feet of outdoor space.
Mid-Day Multimedia currently has four newspapers — Inquilab, Mid-Day, Sunday Mid-Day and Gujarati Mid-Day and one magazine, The Brief. It also publishes books, mainly guides to the cities it caters to.
There is a newfound interest in the share of Mid-Day, courtesy market speculation over the Government allowing foreign direct investment in print media.
The overall slowdown has prompted Mid-Day to put its plans to launch Marathi Mid-Day on hold. However, it plans to launch its FM channel in Mumbai in April.
The company, from its IPO proceeds, had set aside Rs 23 crore for investment in its existing publishing business, including the launch of the Marathi edition of Mid-Day.
Work on Mid-Day's alliance with Zee News has also not yet commenced. The company is in the process of formalising the nature of this alliance. Mid-Day is to provide content in the form of soft news for the channel.
Source: Business Line