John Obrecht reports in b-to-b-online
Hammered by the decline in traditional ad revenue, b-to-b magazines saw their operating margin plunge, on average, from 11.0% in 1999 to 0.6% in 2003, according to a new profitability report prepared for American Business Media by The Jordan, Edmiston Group Inc.
The media investment bank presented its findings Monday at ABM's annual Top Management Meeting in Chicago.
During the five-year period covered by the report, the average b-to-b magazine's ad revenue fell from $3.4 million to $2.8 million, and its EBITDA (earnings before interest, taxes, depreciation and amortization) plummeted from $505,000 to $24,000.
"The most concerning [finding] was the evaporation of profitability, therefore cash flow, therefore the value of the core magazine," said Richard Mead, managing director of Jordan, Edmiston.