An Analysis Report of Independent News and Media Company

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Contents
INTRODUCTION3
COMPANY SHARE PRICE4
CAPITAL STRUCTURE6
Equity as at the end of 2008 financial year6
Cost of Equity7
Debts as at the end of 2008 financial year7
Cost of Debt7
Equity as per the interim result in August 2009:8
Debt as per the interim result in August 2009:8
INM DIVIDEND POLICY9
FUTURE DIRECTION12
Conclusion13
Bibliography14
Appendixes15

EXECUTIVE SUMMARY

Today, businesses are severely affected by the downturn in the economic activities and situation. The fact that nowadays most organisations find it so difficult to continuously achieve a sustainable growth due to scarcity of credit facilities, the credit crunch scandal which led to the global recession has made many corporate organisations to really struggle with repayments of their debts and also made it very hard for them to have a required working capital to finance their operations, in which Independent News and Media is not an exception. This project, however, analysed and tracked changes that had occurred in the last 12 months in Independent News and Media. Areas analysed include: company share price, capital structure, dividend policy, and future direction of the company. Facts and figures are given to highlight these changes using both absolute and relative figures. The project also examined various restructuring programmes embarked upon by the organisation to deal with tremendous decrease in its share price, changes in financial structure and dividend policy.

INTRODUCTION

Independence Newspaper was the bases of the independence news and media; it was founded by William Martin Murphy in Dublin in 1904. The company started with the production of morning news paper, later grown into the evening and Sunday’s production. In 1960, Sir Anthony O’Reilly bought a large amount of share in the company and became the largest share holder taken over from the Murphy’s family who as at that time was in control of the company. Up till date, the Executive Director of the company is GK O’Reilly and BJ Buggy as the Chief financial officer. Independent News and Media is one of the leading news paper and communication group in the world. The main interest of this company is in Australia, India, Indonesia, Ireland, New Zealand, South Africa and United Kingdom, cutting across four continents, ten markets and twenty two individual countries. They publish the independence newspaper which is at present the largest news paper organisation in Northern Ireland. No wonder Robert Fisk says:

"During the year I have to risk my life under shellfire with bullets and I wouldn’t do that if I didn’t know that what I wrote was going to go in the paper as I write it and to know that my editor will stand up for me against all the ambassadors, against all the institutions, against all the lobby groups, I’ll risk my life for that. I have worked on other papers, I’ve felt editorial pressures and I left them all. The Independent I wouldn’t leave."(http://www.inmplc.com/operations/Home Page)

At present, the company delivers over 32 million copies and has more than 10 million customers; this includes the world largest read newspaper, “Dainik Jagran, which is published in India. Currently, the INM has Assets worth of €2.1billion, revenue of €1.6billion and employees of up to 9,600people all over the world. The company continues to have a sustainable growth as a result of investment in market-leading brands and online assets. The company is the largest radio operator with over one hundred and thirty stations and an audienceship that is close to six million listeners. There is no doubt in the saying that this company is performing brilliantly in the media industry. In 2008, the company generated revenue of €1,476.6 million. This represents a 2.6% decline from the 2007. However, the operating profit for 2008 was €290.3 million which indeed represents 9.8% declined on 2007. Considering the current economic climate, the figure...
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