Chairman's statement
"Trading prospects continue to be very healthy and the American company opens up a massive new market"
FROM THE CHAIRMAN
As we move into our seventh year of ownership of Express Newspapers and the 14th year of publishing OK! magazine, Northern & Shell is a powerful and broadbased group at the heart of the British media. It continues to expand its operations both at home and abroad, with foreign editions established in 10 countries including a massively successful entry into the US market. We continue to build on a century of tradition with our newspapers and to spearhead new developments in magazine and television production.
During the first years of our stewardship of the Daily and Sunday Express, commercial efficiency, investment and promotional spend have turned market perception around. Bringing the papers back to their roots in the core values of Middle Britain, we have returned them to the forefront of journalistic excellence. Building on the success of the Daily Star we have launched the Daily Star Sunday and, as a joint venture with Independent News and Media Plc, the Irish Daily Star Sunday. By enhancing the weekend packages across all our products, we have entered an unprecedented era of competitiveness.
In the same period we have consolidated the market leadership of OK! magazine with two more weekly magazines, New! magazine and Star magazine, giving us a combined readership of around three million per week, with an enviable bias towards the much sought-after ABC1 sector. Meanwhile OK! has launched international editions in China, Australia, the Middle East, India, the Philippines, Malaysia, Thailand, Singapore, Turkey, Mexico, and Greece with Spanish, Russian, and German editions shortly to follow. Bringing the brand to North America with the launch in 2005 of OK! USA, has been the perfect opportunity for Northern & Shell to exploit its magazine expertise in the world's largest market.
Northern & Shell has been involved in television production for more than 20 years, from early days when we had an agency producing television advertisements for blue-chip clients. Today, part of the TV operation is dedicated to producing the continuous, high-profile TV advertising campaigns needed for our newspapers and magazines.
On current forecasts, group turnover for 2006 will be on or around £500 million compared with £325 million in 2001 - the first full year after the Express Newspapers acquisition.
We distribute an average of about 2 million newspapers each day and 2 million magazines per week, reaching 10 million readers in the UK and many more in 80 countries throughout the world. Trading prospects continue to be very healthy and the American launch opens up a massive new market. Northern & Shell is operating from a position of strength and is confident that it will continue its record of expansion and growth irrespective of trends in the media business.
Richard Desmond
Chairman of the Northern & Shell Network
Date: August 2006