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Arbitron Q3 Revenue Up 6.4%; PPM Spend Drives Costs
Radio ratings giant Arbitron has posted a 6.4% growth in third quarter revenue to $96.5 million, but has also seen a 16.4% increase in expenses costs attributed to the roll out of its PPM system.
Explained President/CEO Stephen Morris: 'While the PPM commercialisation is both complex and challenging, we have been able to stay on track with our ambitious market-by-market rollout schedule for the Portable People Meter ratings service.'
In September, the firm received complaints from clients that its ratings were being 'weighed' to adjust for under-represented radio listeners ( www.mrweb.com/drno/news7282.htm ). While announcing the firm's financial results last week, Morris was adamant that the data is representative and added that Arbitron is currently examining ways to boost quality of the sample.
In response to the recent announcement of an extended deadline for Project Apollo, which combines Arbitron's PPM technology with Nielsen's consumer product scanning systems (www.mrweb.com/drno/news7430.htm ), Morris said that the extra time required is fully supported by his firm's seven pilot subscribers. He added that enthusiasm among advertisers participating in the test remains high and explained that delivery in the first quarter of 2008 will allow for more tests to prove the project's efficiency as a sustainable syndicated research service.
Arbitron's earnings before interest and income tax expense (EBIT) for the quarter were $27.2 million, a decrease of 15.4% compared with the third quarter of 2006. Its net income dropped to $17.2 million from $20.2 million a year ago. However, the firm expects that revenue will increase between 5.5% and 7.5% in 2007.
Web site: www.arbitron.com.
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