YPG: Online Now 29% of Total Revenues

Canada’s Yellow Media’s shares have been pounded by investors over the course of the past year. Part of the reason for that is the continued, significant role that print directory revenues play in the company’s earnings. There’s considerable doubt among fund managers about the outlook for print.

That often extends to usage research. When data come out supporting the value of print directories there’s frequently skepticism or or outright dismissal of the veracity of the numbers.

However, like all YP publishers Yellow Pages Group has been working to transform and rebrand itself. The company now calls itself “Canada’s leading performance media and marketing solutions company.” It has made good progress toward that goal.

Late last week YPG released Q4 and full-year earnings. Here are some of the highlights:

[Full-year] revenues decreased 5.2% from $1.40 billion to $1.33 billion, due to lower print revenues as well as lower revenues associated with the Company’s U.S. operations. This was partly offset by higher organic online revenues and revenues generated from Canpages and Mediative. Online revenues in 2011 were $346.1 million representing growth of 30% versus last year’s results.

Q4 2011
Fourth-quarter revenues were $313.3 million, as compared to $345.4 million in the last quarter of 2010, mainly due to lower print revenues as well as lower revenues associated with the Company’s U.S. operations. Online revenues for the quarter were $90.0 million or approximately $360 million on an annualized basis.  Online revenues now represent approximately 29% of total revenues compared to 21% in 2010.

Online revenue growth, as you can see, was 30% from 2010 to 2011. Online or digital now represents 29% of YPG/Yellow Media’s total revenues. In May of last year YPG announced that “30% of YellowPages.ca traffic currently comes from mobile.”

Recently Yellow Media completed integration of Canpages into YPG and laid off the majority of Canpages’ staff.

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9 Responses to “YPG: Online Now 29% of Total Revenues”

  1. Electricians says at

    Greg what are your thoughts on how the share price will pan out over the next two or so years?

    Its obvious that within 2-3 years the print revenue will shrink down to an insignificant percentage of the overall revenues. Once that occurs, would it be fair to assume that these Yellow Pages type companies will no longer have shrinking revenue numbers and will start experiencing true growth once again?

    Or is it believed that other players (google, reach local, angies list, service magic, etc) are grabbing this new digital revenue and consequently market share, leaving little room for future growth for the Yellow Pages companies?

  2. Greg says at

    I think that print revenues will continue to degrade over time. I also think that competition for digital dollars/pounds/euros is intense. 

    I do think that properly managed YP can build a growth story with digital. However the pull and influence of the legacy business remains strong. It’s a question of whether these organizations can transform themselves. 

    They’re in the proccess — or at least they’re saying the right things. But we’ll have to see. Clearly not all the YP companies are going to “make it through to the other side.” YP has enough digital assets that it may be one of the survivors. 

  3. Greg says at

    Meant to say “YPG” has enough digital assets . . . 

  4. Street Fight Daily: 02.13.12 | Street Fight says at

    […] this tool to launch an experiment with member station KPLU.YPG: Online Now 29% of Total Revenues (ScreenWerk) Greg Sterling: Online revenue growth was 30% from 2010 to 2011 at Yellow Pages Group. Online or […]

  5. RealityCheck says at

    “Online revenues in 2011 were $346.1 million representing growth of 30% versus last year’s results.”

    I’d be really interested to find out how they calculate “online” revenues. I would think the majority of their revenue comes from bundled products. Hence wouldn’t it really be an arbitrary number? eg. This year we alocate 30% of the bundle revenue to online.

  6. Greg Sterling says at

    Is suspect that the bundling point is correct . . .

  7. Andrew Shotland says at

    While it’s no doubt a tricky path, YPG has some strong online assets.  I think they hit something like 2/3 of all Canadians on the Web every month.

  8. Greg says at

    Yes their relative reach is greater than US Yellow Pages comparable reach

  9. Michael Imbleau says at

    Reach is easy to measure…but NOT a good barometer for the health of the YP marketplace.
    1. Reach can be bought. It’s easy to artificially prop-up reach.
    2. Reach isn’t market share. I may use YP 1x/month, but then use other channels 10x/month. YP is missing out on 90% of the opportunity, but reach stays high.
    3. High value vs. low value search. I often use YP when I know the exact name of the business, but I don’t have the phone number. There is no (or low) value in this to the merchant. Infact a merchant doesn’t have to be a YP customer to get this value.

    That said, higher reach is better than lower reach! 😉

  10. Greg Sterling says at

    Right. Reach doesn’t equal frequency. Frequency is a better measure of a medium’s health. Indeed.

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