Feeds/newsletters
Emap: Emap France for sale
Emap has announced that it intends to sell its declining French consumer magazines business. Given that this business generates 13% of operating profit and and the proceeds of the sale are to be returned to shareholders, the effect on the rating should be limited.
On the other hand the effect on growth prospects is likely to be mildly positive. This has always been the weakest of Emap's businesses and we would regard the disposal as being positive for shareholders at any reasonable price.
At 950p Emap is trading on a prospective PE of 14× and there is some support for the price from the 2.8% yield. However the slower growth in both UK consumer magazines (31% of operating profit) and radio (17% of operating profit) makes Emap with Emap France at this rating less attractive than it would have been a year ago.