UPDATE 1-Publisher Mecom raises core profit forecast; shares soar
* Raises full-year EBITDA forecast to 70 mln euros-80 mln euros
* Third-quarter revenue falls 11 pct to 23.6 mln euros
* Third-quarter EBITDA rises to 20.3 mln euros
* Costs fall 13 pct to 25 mln euros
* CEO Stephen Davidson to step down by month end (Adds analysts' comments; updates share movement)
By Aashika Jain
Oct 15 (Reuters) - European publishing company Mecom Group Plc, which has been struggling with a fall in advertising revenue in its Dutch and Danish businesses, raised its full-year core profit forecast on Tuesday, sending its shares up as much as 42 percent.
Mecom now expects full-year earnings before interest, taxes, depreciation and amortization (EBITDA) to be between 70 million euros and 80 million euros ($7.61 billion), due to a stabilization in the rate of advertising revenue decline in the Netherlands and cost benefits realised in the quarter.
The publisher had said in July that it expected core earnings at the upper end of its previous forecast of 50 million to 60 million euros, as it continued to cut costs.
Mecom has been selling assets and cutting jobs and costs to ease the impact of sliding advertising rates across all its markets.
Canaccord Genuity said that Mecom's balance sheet has been significantly rebuilt, and the 2014 forecast was underpinned by further restructuring activity. The brokerage raised its price target on the stock to 108 pence from 89 pence.
Mecom shares, which have fallen 46 percent since the beginning of the year, were up 41 percent at 57.32 pence at 0918 GMT, making them the biggest percentage gainers on the London Stock Exchange.
The company, which owns more than 250 printed titles and 200 websites, said Stephen Davidson would step down as CEO by the end of October.
"The CEO is stepping down primarily to reflect confidence in the leadership of the Danish and Dutch businesses, and the natural conclusion of the strategic review that had been ongoing," Numis analysts Gareth Davies and Paul Richards wrote in a note.
Revenue fell 11 percent to 23.6 million euros, in the three months ended Sept. 30, while EBITDA rose 1.3 million euros to 20.3 million euros, Mecom said on Tuesday.
Total costs fell 13 percent from a year earlier. Costs fell 15 million euros in the Netherlands, while they were 11 million euros lower in Demark, helped by a restructuring programme and some disposals. ($1 = 0.7361 euros) (Reporting by Aashika Jain in Bangalore; Editing by Supriya Kurane)
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