Emap shares down 15 per cent on decline in men's magazines

A slump in men's magazines' readership has knocked first-half revenues at Emap, the media group warned yesterday to the dismay of investors.

Speaking at his last annual meeting, Adam Broadbent, who was succeeded as chairman yesterday by his deputy Alun Cathcart, struck a cautious note about the rest of the year. Underlying revenues are likely to fall in the first half, reflecting weaker advertising revenues from Emap's UK consumer magazines and radio stations, he said.

Emap shares plummeted, closing 15 per cent lower at 712p. The stock has fallen from a near-five year high of 950p in February.

Mr Broadbent said: "The trends that are now emerging make us more cautious about the prospects for underlying revenue, which may be marginally down in the first half [and] for the year as a whole broadly flat."

About 150 of Emap's private shareholders turned up for the AGM. One retail investor pressed the board to explain why the market had taken fright at Emap's update, which singled out its monthly titles as the most problematic. Mr Broadbent admitted he was "surprised" by the reaction, although analysts said it was because the outlook for the media group had deteriorated quicker than expected.

Analysts, who had expected full-year underlying revenue to rise by 2 per cent, cut about 4 per cent from their profit forecasts. Numis Securities is looking for pre-tax profits of £225m for the year to next March, down from £235m.

Tom Moloney, the chief executive, said men's magazines had seen a "dramatic decline" throughout the industry. To compound the effect, advertising is softening in UK consumer magazines.

Emap's FHM lifestyle magazine, Maxpower car title, and MCN motorcycle monthly have been worst affected. The extent of their drop in circulation will be revealed in the biannual ABC readership figures due out on 17 August.

One automotive industry observer said the monthly automotive titles, which are aimed at teenagers wishing to soup up their old bangers and tend to feature as many partly clad women as cars, had suffered from the launch of the weekly titles Nuts and Zoo. Men prefer to buy the cheaper weekly titles, he said.

Emap, which owns Zoo, said there had been "good growth" in circulation from most weekly titles, adding that it expected to maintain its "competitive position" in the next ABC figures.

It said it expected to continue to outperform the UK radio market, where it owns stations such as Magic and Kiss, despite the "weakening outlook" for advertising. It added that its business-focused titles had suffered from a faster decline in public sector recruitment than it had expected, although its other titles were performing well.