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Arbitron Income Drops as PPM Costs Rise
US radio ratings giant Arbitron has reported a 20.7% drop in net income from $4.9m to $3.7m, with soaring costs relating to the roll out of its Portable People Meter (PPM) device.
Costs and expenses for the fourth quarter increased by 10.6%, from $72.3m in 2006 to $79.9m in 2007, due to planned PPM expenditure for panel builds in New York, Nassau-Suffolk, Middlesex-Somerset-Union, Los Angeles, Riverside, Chicago, San Francisco and San Jose.
Arbitron's fourth quarter revenue rose 5% to $80.1m from $76m last year. For the full year, net income dropped 21% to $40.2m and revenue rose 6% to $338.5million. For the full year 2008, Arbitron expects revenue to increase another 8-10%.
Earlier this month, Arbitron sold Continental Research to London-based BDRC (www.mrweb.com/drno/news7926.htm ), and as a result of the sale, Continental's financial results have been reclassified as a 'discontinued operation' - generating revenue of $13.6m and a net loss of $0.3m for the year.
Chairman, President and CEO Stephen Morris comments: 'In November, responding to feedback from our customers, the Media Rating Council and other constituencies, we elected to delay the scheduled December 2007 commercialisation of the PPM system in New York and in eight other markets by up to nine months' (see www.mrweb.com/drno/news7637.htm ). espite these costs, Morris says the firm's core radio ratings business remains profitable and its basic business model intact. Web site: www.arbitron.com.
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