Chairman’s report 30th September 1993
For 1991/92 I had to report a difficult trading year and, for a time, it appeared that a similar pattern was being experienced in 1992/93. I am very pleased to say, however that the efforts of management and staff, coupled with a modest recovery from the recession, eventually disclosed a very different picture.
Turnover for the year increased by 41 percent, considerably in excess of the general experience in our industry. A tribute to both local acceptability of the re-launch programme format and greatly increased sales force activity. The increases in reach and listening hours, as evidenced by the most recent JICRAR, have been amongst the most notable in local radio.
The increase in operating costs, excluding NTL charges, was held to 9% and a pre-tax loss of £78,000 was turned into a profit of £155,000, despite the increase in transmission costs from £19,000 to £103,000.
This improvement in trading, together with a share issue of £244,000, has had an equally dramatic effect upon the balance sheet of the company. Net current liabilities of £175,000 have been converted to net current assets of £246,000 and borrowings eliminated.
The service being given to the communities in our franchise area has been substantially extended during the year. Partnership groups have been formed with a number of representatives of business, health and education organisations to ensure that DevonAir plays its full part in improving the quality of life for all in South Devon. This development has been enthusiastically received a supported by all concerned.
Against this background, it was with justified confidence and widespread support that we asked The Radio Authority for the renewal of our existing broadcast licence, following its expiry at the end of 1994 we were able to demonstrate full compliance with all the requirements of the broadcasting act, whereas competitors were only able to give theoretical indications as to how they would offer an alternative service to what they predicted would be a lesser audience and had shown relatively little local representative backing.
It was with the total shock and disbelief that we learnt that The Radio Authority had purposely decided to ignore expressed local wishes and proven record and were offering the service to a company primarily supported by another station, which we believed to be, in all respects, much less successful than ourselves.
At the time of writing this report, we are in consultation with our shareholders and local community representatives to decide upon the appropriate course of action.
DevonAir has created an important niche for itself in the commercial and cultural worlds of South Devon. In association with Plymouth Sound it has become financially viable entity, despite the sevenfold increase in transmission costs, capable of tackling the remaining opportunities of increasing choice and overcoming the known topographical problems of the region, problems ignored by our competitors.
The decision of The Radio Authority has weakened the drive towards economic recovery in our joint areas and has significantly and eroded the role of independent local radio. They have no representation from the area and their local soundings appear to have been, at best, perfunctory.
Throughout the year, and particularly in the most difficult recent weeks, the professionalism and dedication of the staff of DevonAir has been exemplary. I would like to take this opportunity of thanking them for all they have done and to ensure them that the board has their long-term welfare at the top of its agenda.
K.E. Holmes