(Adds exec comments, analyst reaction, shares)
By Costas Pitas
LONDON Feb 5 The publisher of Britain's Daily
Mail tabloid and leading news website MailOnline posted a 6
percent increase in first-quarter revenue on Wednesday, boosted
by a jump in online advertising and growth in events and its
financial information service.
Shares in Daily Mail & General Trust rose to a
13-year high after the update and were trading up 4.6 percent at
1,013 pence by 0937 GMT.
Underlying revenue at the group, whose MailOnline has grown
to be among the world's most successful newspaper websites and
which also publishes the Metro freesheet and Mail on Sunday
title, reached 472 million pounds ($769 million) in the three
months to Dec. 31.
Online advertising revenue grew 5 million pounds to 14
million for the quarter, offsetting a 1 million drop to 53
million in print advertising revenue at the Daily Mail and The
Mail on Sunday.
Whereas some British newspapers including The Times and The
Sun, owned by News Corp, have placed content behind
paywalls, the Daily Mail has pursued an advertisting-led
strategy to boost revenue.
Finance Director Stephen Daintith said he expected to see
online advertising revenue in the United States to at least
double to 10 million pounds and that e-commerce through the site
was proving popular with customers.
"You'll notice you can click through on certain photographs
through to an opportunity to buy a dress or a handbag," Daintith
said. "We've got commission rates of anything between 5 percent
and 12 percent on retail price that we benefit from."
MailOnline continued its strong growth, notching up 162
million visitors in December, up 41 percent on last year, and
9.9 million daily visitors, up 39 percent, lured by the
website's mix of celebrity news, pictures and human interest
Circulation revenue at the print titles fell 2 percent
year-on-year, though a drop in the number of copies sold was in
part offset by cover price rises last February.
Analysts at Citi, who rate the shares "buy", said the
newspaper business was seeing the benefit of an improving
economic outlook in Britain and the shift to online, while
momentum in business-to-business (B2B) was better than the
Overall, the group saw 10 percent growth in B2B activities,
which includes events, financial information service Risk
Management Solutions, and data and analysis platforms in
education and energy.
DMG also said it was part of discussions on strategic
options for property website Zoopla, of which it owns 52.6
percent. Citi said the Zoopla comment confirmed a sale is
possible and leaves DMGT with a chance of being debt free by the
end of the year.
($1 = 0.6137 British pounds)
(Editing by Paul Sandle and David Holmes)