BBC Worldwide to explore selling stake in its magazine business

[This post has been updated]Following a review of BBC Worldwide's operations last year, the BBC Trust has said that the BBC can explore the sale of  all or part of its magazine division. It includes such large and well-known titles as Radio Times (the most profitable publication in the group), Top Gear and Lonely Planet and last year made a profit of £18.4 million.

The BBC has already sold its audiobooks division as part of the review, which concluded that BBC Worldwide needed to be more internationally focussed and needed to shed some of its domestic operations, according to a story on the BBC News site.

"The Trust has agreed that Worldwide can explore with the market options for the future of its magazines business, as long as it does so without making any binding commitment at this stage," the BBC Trust said in a statement.

"The Trust's focus will be on delivering the best deal for licence fee payers and any specific proposal would require our formal regulatory clearance."

According to the story, some 30 potential bidders have expressed an interest in buying a stake in the titles. There would be restrictions on a sale because it depends on approval by competition authorities. And, for a title like Radio Times -- both a magazine and a BBC program guide -- any deal would depend on assurances about content, since the magazine is a crucial promoter of BBC programs, services and products.

BBC Worldwide publishes several magazines that circulate in Canada including BBC Music Magazine, BBC Sky at Night, BBC Focus, Homes & Antiques, Top Gear, BBC History Magazine and BBC Knowledge.

[Update:

• Sale of BBC magazine titles such as Radio Times poses plenty of questions (Guardian)]
  

Related posts:

• BBC Worldwide says profits up 35.5% last year; magazine division holds its own
• BBC may sell off some of its magazines, partner on others

BBC Worldwide says profits up 36.5% last year; magazine division holds its own

BBC Worldwide Ltd., the corporation's magazine and commercial division, has reported its operating profit for the year ending March up 36.5% to £145.2 million. According to a report in Press Gazette

Chief executive John Smith said: "Today’s figures, with profits up by 36.5 per cent, demonstrate that our strategy is working. As well as developing into a diversified global media business and extending the international visibility of the BBC brand, the company is delivering a strong financial performance.

"BBC Worldwide continues to give consumers around the world more and more content from the BBC and other British production companies. This allows us to re-invest in more great content and return more cash to our parent organisation, the BBC.”

Magazines are one of Worldwide's seven core businesses. The profit from magazines was £168.3m, and overall sales were down marginally (-1.3%) from the year before.  The full annual report is here (fair warning, it is 10mb).

• The four biggest titles -- Radio Times, Good Food, Gardener's World and Top Gear -- maintained their positions and their profitability at 16.5%.
• Overall circulation for adult magazines  rose slightly 2.4 million versus 2.37 million in 2009.
• Subscriptions grew 9.6% to an all-time high of 940,000 (most BBC magazines are sold as single copies)
• Children's magazines (a relatively small portion of the magazine business) slipped somewhat in profitability
• Joint ventures recovered from a 2.1% loss last year to a very modest profit this year (0.6%). These include magazine distribution, subscription fulfillment and consumer shows in the UK and international partnerships in India and Australia.

"We are expecting a further increase in profitability for Magazines in 2010/11 as investments in the current year are realised and as the business sees a full-year benefit from the 2009 restructure. Magazines has exceptionally strong brands, delivers consistent value to advertisers and readers, and operates in market sectors which we expect to remain relatively resilient, in spite of longer-term concerns about the health of markets for printed products," said the annual report.

BBC may sell off some of its magazines, partner on others

BBC Worldwide is undertaking a shakeup of its multi-title magazine division and is considering selling Radio Times magazine. According to a story in the Times newspaper, BBC Worldwide is considering entering into a licensing arrangement or partnership with a rival publisher for many or all of its 50 titles, maintaining editorial control and the vaunted BBC standards while enabling the organization's portfolio to be more profitable. 

Worldwide’s magazines division made a profit of £11.5 million last year on sales of £182 million. Sources close to the company, whose titles include Top Gear, Doctor Who and Gardeners’ World, said that the tie-up would create a “mixed portfolio” in which the some magazines would be sold while others would be licensed to the new partner to publish.

The source said: “It can’t just be about flogging off the company because a lot of the magazines are BBC-branded and programme-branded and a huge part of their value is their relationship with the BBC. It’s not straightforward and it’s not going to be the same structure for all of them. There are some titles that could be sold, some parts need to remain close to the BBC.”

BBC is Britain's fourth biggest consumer magazine publisher, selling 85 million copies a year. According to a separate Times story, Sir Michael Lyons, the chairman of the BBC Trust, last November ordered the magazine division to halt acquisitions. Cash raised from any sale or licensing of magazines could be used to help buy out Virgin Media from the joint venture UKTV, the story said.