Capital sees ad market recovery

Johnny Vaughan will be the new face of Capital FM

The hard-hit UK advertising market is showing early signs of a pick-up, according to Capital Radio.

The positive assessment came as the Britain's largest radio company reported an 18% drop in annual profits.

Capital's boss David Mansfield said he remained "cautiously optimistic of early signs of an improvement in the advertising market as a whole".

The firm posted underlying profits of £22.8m ($38.16m), down from £27.8m a year ago.

New face

Group revenue also slipped 4% to £115.3m, Capital said.

But the group said its revenue in October was up around 8% against the same month last year, while booking levels for December were positive.

Last month, the group's flagship Capital FM station was overtaken for the first time in 30 years as London's most popular commercial station.

Capital said it was hopeful that its new breakfast show presenter Johnny Vaughan would win back audiences when he takes over veteran DJ Chris Tarrant in Spring 2004.