Profits Jump 10% At Daily Mail and General Trust Plc

Daily Mail and General Trust plc (LON:DMGT) releases strong full-year results.

Mark Rogers

As the Head of The Motley Fool’s UK Investing Team, Mark approaches the stock market with the same old-fashioned business instincts and values that he honed growing up around the family business. An investor for 20 years, Mark specialises in unearthing top-quality under-the-radar investments in the small-cap market. He currently serves as Director of Investing for Motley Fool UK services and Managing Director of Motley Fool UK.

Published 21 November, 2013 10:32 am GMT

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The shares of Daily Mail & General Trust (LSE: DMGT) climbed 3% to 870p this morning after the media giant revealed a double-digit expansion in its full-year profits.

Boasting pre-tax profits of £282m, DMGT smashed analyst earnings expectations of £270m for the year. The company used its strong cash generation to slash its net debt position by £40m to £573m.

The Mail On Sunday publisher — which has exploited an impressive growth opportunity with its Mail Online website — was boosted by its business-to-business and consumer divisions.

Giving its outlook for the rest of the year, Daily Mail & General Trust added:

“We have entered the new financial year with our businesses performing well and in line with our expectations … First quarter consumer trading to date has been satisfactory but we remain cautious about the medium term outlook, given continuing external uncertainties, particularly for UK advertising. A continued focus on cost efficiencies should provide margin stability.”

With a market cap of £3.1bn, DMGT’s shares trade at 16 times expected earnings, and offer a prospective dividend yield of 2.4%.

Of course, whether that valuation, today’s announcement and the future prospects for the media industry all combine to make shares of Daily Mail General Trust a ‘buy’ remains your decision.