Sportsworld dives as sponsors flee

Nick Goodway12 April 2012

SPORTSWORLD Media Group saw its shares crash by 60% or 97 1/2p to 63 1/2p after it warned investors that it had lost money in the first half and would make barely half of what the market expected in the full year.

Last March the shares peaked at 695p, valuing the group at almost £500m. Today it was worth £43.7m.

Chief executive Geoff Brown said that in the past 20 years he had not seen as dramatic a slowdown in sponsorship spending as over the past two months. 'The market has died and we're not sure when it's going to pick up,' he said. 'Clients have shifted all their spending to below-the-line marketing in order to shift their products.'

That has left Sportsworld with no takers for a string of top sports sponsorship packages, ranging from advertising on Toyota Formula One cars to backing Australian basketball. Such sponsorship had been forecast to account for about 15% of this year's revenues, but will cost more because, as Brown said: 'You take on the large overheads before you get the income.'

Analysts had expected trading profits of £16m in the year to next June, but Sportsworld said that it would lose £2m in the first half and make between £9m and £10m for the full year.

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in