More on Chrysalis
Chrysalis: H1 results
Chrysalis Radio’s performance in the half year was fairly typical for the industry with revenues down 4.6% but the second half has started very well with revenues up 10%. A significant profit recovery looks likely.
The smaller Chrysalis Music (27% of EBITA) did not produce any revenue growth over the half year, but its margins did recovery.
The strong performance of LBC is very encouraging but Chrysalis’ other radio stations have been losing market share, offsetting LBC’s gains. However the higher proportion of listening hours coming from London does slightly increase the value of Chrysalis’ radio audience.
Despite the recent improvement Chrysalis is still not the high growth stock it once was. It has a good range of radio stations and a moderately strong independent music publishing business, but we can see not really strong growth drivers in either of these. Given this we do not feel that the share’s high rating, a PE of 36× 2007 earnings with a yield of just 1%, is justified.
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