Number of media companies in FTSE 100 at all time low

When the London Stock Exchange confirms its list of promotions and relegations tomorrow (9 September 2008), the number of media companies present in the FTSE 100 will be at its lowest level for more than 10 years, according to research issued today from accountants and business advisers BDO.

A review of all the companies identified that once ITV is relegated tomorrow only five per cent of the FTSE 100 will be media companies.  This is a significant fall from the highs of 10 per cent in the early part of the noughties.  Other recent leavers include Yell and the Daily Mail Group.

Andy Viner, Head of Media at BDO says: “Media companies are really struggling in this difficult trading environment, particularly as spend on classified advertising is falling dramatically.  Those who are best surviving the credit crunch seem to be subscription based companies such as BSkyB, where for example a large number of consumers are reluctant to give up watching football – particularly as we’re at the start of a new season.”

“Media companies also rely to an extent on consumer spending, which, as individuals reign in their finances, is drying up,” continues Viner.

“However, it might not all be doom and gloom in the future for media companies, as many believe that there will be opportunities for new revenue stream as consumers migrate to online and mobile channels,” Viner suggests.

A review of all of the TMT firms (technology, media and telecoms) listed on the FTSE 100 revealed that technology companies have faired much better than their media counterparts, with the highest number of tech companies present for more than five years (at three per cent).

In addition, the number of telecoms companies listed in the FTSE 100 is at its highest point for three years (four per cent).

“Despite the number of media companies in the FTSE 100 at its lowest point, the fact that technology and telecoms companies are increasing in presence suggests that the TMT sector on a whole is more resilient than one might expect,” concludes Viner.

For more information, please contact Dee Crooks at BDO on 020 7893 2761 / 07815 172 051 or email dee.crooks@bdo.co.uk

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