Mr. Bowdler: The company has its roots in a very old, family company, which started its life in 1767. The current chairman is a direct descendant of the founder of the business. It stayed a small newspaper publishing company based on 'The Falkirk Herald' until the 1960s, and grew since then through a series of acquisitions. The company went public in 1988 and floated with a market cap of around 30 million GBP. Since then through a series of acquisitions which extended our newspaper publishing activities widely through Scotland and England, from the middle belt of Scotland to the south coast of England. If we are successful in the acquisition of 'Portsmouth and Sunderland Newspapers Plc', which is still conditional (but we're hopeful of completing in a few weeks' time), we will own over 180 local newspaper titles in the U.K. We did for a period have other activities in our portfolio. We owned a bookbinder, a book selling operation, a wholesale stationery business, and we were commercial printers for a period. All of those activities have been disposed of since 1994, the last being wholesale stationery which was sold a few weeks ago. So we are 100% newspaper publishers here in the U.K. The only activity offshore is the Isle of Man, but in effect we can include that in the U.K. activities. We have a turnover of in excess of 200 million GBP.
TWST: Can you comment on the size and the growth potential of the
publishing industry? What are the key trends that you face in this
marketplace today? For example, could you appraise the business climate?
Mr. Bowdler: We operate almost entirely in the regional press, which
takes approximately 17% of the total advertising spend in the U.K. So in
itself it's a very sizable sector, second only in terms of its
advertising take, to television. Its share of that marketplace has
dropped over a number of years, but its advertising revenue has grown in
real terms. In other words, total advertising spend has grown in real
terms, but regional press share has dropped because of the fragmentation
and proliferation of other media - the growth of local radio, for
example. But nonetheless, the regional press remains a very healthy
sector. It remains particularly strong in classified revenues, for
example, job advertising, motors and property. And also it has a very
substantial share in local display advertising throughout the U.K. The
trends in the industry suggest that it will continue to have a healthy
future. Inevitably there is competition for our revenues. The new media
is going to certainly be a factor. But we are also players in that field
and regard it as an opportunity as much as we do a threat. So I'm
optimistic. I think the printed word has a great future. I think the
role of the local newspaper, with its focus on its local marketplaces
and the very parochial nature of its news, is an essential component of
local life.
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