German publisher Springer pushes further into digital era

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German publishing group Axel Springer posted Wednesday solid results for the second quarter and first half of 2011 that underscore its strategic shift towards digital media.

Springer, which owns the biggest circulation German daily Bild, said second quarter sales gained 12.5 percent to 789 million euros ($1.1 billion), in large part owing to acquisitions like the French Internet housing ad site SeLoger.

The German group has also recently established an Internet joint venture in eastern Europe with Swiss counterpart Ringier.

Digital media now account for more than 30 percent of Springer's sales and investors hailed the results, driving up Springer shares in midday trades.

"Our company is seen as a paper publisher with digital activities but that is a misleading perception," chief executive Mathias Doepfner told a conference call.

In the first half of the year, sales from digital outlets overtook those of Springer's paper operations for the first time, with respective figures of 342 million euros and 318 million euros.

"The trend is towards a reduction in the number of printed pages and I do not see any sign that this trend will reverse, it is structural," Doepfner said.

Springer's second quarter net profit plunged by almost 25 percent to 79 million euros meanwhile, owing in large part to an unfavourable comparison with the year-earlier figure that had benefitted from exceptional items.

The group did not provide a second-quarter operating result but reported one for the the first half that was 10.5 percent higher at 288.7 million euros.

Springer's sales increased 11.8 percent to 1.52 billion euros over the six-month period, a statement said, though when adjusted to take account of acquisitions, the rise was a more modest 4.2 percent.

The publisher confirmed its full-year forecast for sales growth of under 10 percent.

It said the main sources of growth in the first six months of the year were "revenue increases of 53.4 percent in international print media and 30.3 percent in digital media."

Those two sectors accounted for almost 40 percent of the publisher's operating profit, Doepfner was quoted as saying.

Axel Springer shares leapt 4.63 percent to 30.28 euros on the Frankfurt stock exchange while the MDax index on which they are listed was 1.62 percent lower overall.

© 2011 AFP

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