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Last Updated: Tuesday, 10 May, 2005, 16:33 GMT 17:33 UK
Profit dive hits Chrysalis shares
Jamie Theakston
Jamie Theakston now presents Heart 106.2 FM's breakfast show
Shares in UK radio and music group Chrysalis have fallen nearly 7% after a sharp drop in half-year profits.

Chrysalis blamed ongoing problems at its troubled book division and warned advertisers were cutting back on radio adverts.

Pre-tax pre-exceptional profit fell 86% in the six months to February to 1.2m, against 3m at the same time last year.

But, programming and marketing changes helped its Heart radio station regain the No 1 spot in the key London market.

Lower-than-expected performance figures for Heart hit revenues in the first-half, Chrysalis said, but since then the station's image has been revamped with presenter Jamie Theakston taking over its breakfast show.

Heart beats

Heart overtook rival Capital, owned by Gcap, as the most popular London commercial radio station, according to the latest audience research figures released by radio trade body Rajar last week.

Radio is a very short term medium - it will always be one of the first to suffer when people tighten their marketing belts
Richard Huntingford, chief executive

The company said it should begin reaping benefits from Heart's new status as London's No 1 in about six weeks.

Meanwhile, the London-based firm said the seasonal nature of its book publishing arm had contributed to first half weakness.

But the group said it plans to divest its struggling children's and promotional divisions in an effort to get profits back on track.

On the plus side, its core music business division performed well, with albums from Feeder, Athlete and Lucie Silvas all selling strongly.

However, falling advertising revenues, reflecting waning consumer confidence were a cause for concern.

"The High Street has been a sorry place for the last few months," said chief executive Richard Huntingford.

"Radio is a very short term medium - it will always be one of the first to suffer when people tighten their marketing belts."

At the close of trade on Tuesday, shares in Chrysalis were quoted 4.0 pence, or 2.78%, lower at 140p.




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SEE ALSO:
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