13 January 2011 – trading statement

Media group Mecom has issued a trading statement for the year ending 31 December revealing that  EBITDA for the year will be approximately €155m compared with €121m for 2009.  Most of this improvement has come from Denmark and Norway with the Netherlands and Poland seeing lower growth.  Net debt at the end of the year was €312m – a reduction of €61m during the year – considerably better than the reduction of €20m expected at the start of the year.  Although further progress is expected in 2011, with the company hoping to start paying dividends, there is still considerable uncertainty about the outlook for advertising.  Following the recent strong run in the share price, we reduce our recommendation to HOLD.