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Irish Daily Star - 2013 Accounts Published

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  • 18-12-2014 7:29pm
    #1
    JTMan
    Registered Users Posts: 5,539 ✭✭✭


    The 2013 accounts for Independent Star who print the Irish Daily Star newspaper have now been uploaded to CRO.ie.

    Independent Star continues to be owned 50% by Desmond (N&S) and 50% by IN&M.
    • Turnover fell from 28.0 million to 23.8 million.
    • Cost of sales fell from 17.0 million to 14.8 million.
    • Distribution and marketing expenses fell from 4.7 million to 3.5 million.
    • Profit down from 1.8 million to 1.7 million. (would have been worse except for viscous cuts)
    • Cash down from 1.1 million to 0.8 million.
    • Dividend increased from 1.6 million to 2.7 million.
    • Employees fell from 107 to 68.
    • Wages fell from 6.3 million to 4.9 million.
    • Creditors have increased from 3.7 to 3.8 million.
    • 3 directors resigned during the year.
    • BDO, the auditors, said that there was "going concern risk" due to declining newspaper sales. However, BDO shockingly allowed account preparation on a going concern basis.
    • Total net assets are a tiny 0.1 million down from 1.1 million. Assets barely outstrip liabilities.

    Desmond is taking as much money from this newspaper business as he can before it collapses.

    The company is getting stripped to the bone, staff numbers are plunging, wages are plunging, marketing is plunging and sales are plunging off a cliff.

    The bank balance is smaller and creditors are growing.

    However, thanks to all the viscous cuts, it is still a profitable newspaper business as at 31 December 2013. Cuts can only go so far, newspaper sales are only going one way and therefore profitability will be short lived.

    Desmonds strategy seems to be to cut costs extremely aggressively, extract big dividends and appoint directors. He will stay at the wheel as long as dividends continue, profitability can continue and costs can be cut. Difficult to say how long this will last and how long the Irish Daily Star has left but it is not more than a few years.


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    #2
    IRE60
    Registered Users Posts: 1,880 ✭✭✭IRE60


    Thanks for that - very interesting. Considering its the 2013 accounts it's probably in a worse state now (financial accounts).

    The cash at hand strikes me as low - but the circulation revenue would be paid fairly quickly whereas the ad revenue would be 30/40/50 days!

    Stafff - i'd say that's shrunk again since the accounts.

    Distribution in line with the circualtion declines and marketing - well they do fcuk all now.

    The dividend is savage - and I can't recall where the dividend is ending up, is it Desmond and the Indo take the hit elsewhere or...? but - its still a fair plundering of the accounts.

    JT is only doubles down my theory that it will be sold down the river in the next 12 months.


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    #3
    JTMan
    Registered Users Posts: 5,539 ✭✭✭JTMan


    IRE60 wrote: »
    The cash at hand strikes me as low - but the circulation revenue would be paid fairly quickly whereas the ad revenue would be 30/40/50 days!

    The cash balance is low primarily because of the dividend payment. Operational cash flows were positive in 2013. Day-to-day they have positive cash flows but their margin is declining rapidly.
    IRE60 wrote: »
    The dividend is savage - and I can't recall where the dividend is ending up, is it Desmond and the Indo take the hit elsewhere or...? but - its still a fair plundering of the accounts.

    50% of the cash dividend goes to Desmond. 50% goes to IN&M.

    The corresponding hit is to the cash balance at IS, to the retained earnings at IS and ultimately to IS's ability to carry on as a going concern.

    The more you strip out of a business, the less wriggle room exists to flight headwinds.
    IRE60 wrote: »
    JT is only doubles down my theory that it will be sold down the river in the next 12 months.

    24 months to 36 months would be my guess. Desmond will bleed every last cent out of IS.


    On a separate note, IN&M are both a creditor and debtor of IS. Interesting that IS seem to be trying to get the IN&M-only debtor figure (around 1 million) to almost totally negate with the IN&M-creditor figure by possibly giving IN&M favourable creditor terms. This means that when IS collapses, IN&M will not take a hit because the payable and receivable figures will negate.


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