2010/11 print revenue fell 18.6 percent and the grop lost nearly 10 percent of its print advertisers (1,195,000). It added nearly as many digital advertisers (902,000), pushing digital media revenue up 9.4 percent to £457 million, or 24.3 percent of the total, the group reported on Tuesday. But, in the latest quarter, digital revenue growth slowed to seven percent.

“The digital marketplace is already twice the size of the total print market and some ten times larger than the segments of the print market Yell traditionally addressed,” CEO Mike Pocock said in earnings. “Small shares of this fast growing and highly fragmented market can mean very significant, profitable growth.”

“This is what we intend to deliver, whilst nurturing our print business for the strong cash flows it will continue to provide for years to come … We are not counting on an improvement in the economic environment.”

Yell says it has clocked six million app downloads to date and Yell.com the group claimed 55.8 million unique visitors in March.

Release.

“Yell’s challenges stem from both economic pressures and, more fundamentally, from the shift to digital media. However, Yell also has clear strengths including its brand, its relationships with 1.4 million SME customers, the quality of its people and its powerful cash flows.

“We expect print to continue to decline steadily. That said, print remains highly cost-effective for our advertisers and it will continue to be so, complementing digital for many years to come. In this reducing print market, we believe that Yell continues to gain market share.

“The digital marketplace is rapidly growing and highly fragmented. It is one where the consumer is a leader and a small market share can mean big business and strong growth.

“General search is consolidated. Local search is not, and Yell is already the source of many of the local listings produced by general search engines, as well as growing its own Yell destination sites. The foundations of web print are established; Yell’s website creation and management services are developing and growing rapidly; Yell has successfully entered the mobility space, itself still very young, with apps on smartphones and iPads; and it is beginning to explore social networking and recommendation.

“All this can be radically built upon to provide solutions for consumers and to be a solutions provider for the SME, making Yell as relevant in the digital age as Yellow Pages was in the print only age – perhaps more so.

“Doing this will change Yell’s structure, products, systems, culture and prospects. It will open up not only the opportunity for digital revenue streams but also for substantial synergies through group-wide operation of key functions and it will bring with it new strategic partnerships.

“It will take time to change the revenue trajectory and to secure the available synergies but we can see a course for Yell to return to sustainable profitable growth and we believe Yell has the business base and financial strength to achieve this.”

Q3 highlights…
– Digital revenue up 10.4 percent to £342.2 million.
– But print revenue down 18.4 percent to £936.6 million.
– So group revenue fell 11.8 percent to £1.35 billion.

The problem with Pocock’s argument that “general search is consolidated, local search is not”, is that many people no longer see a difference between Googling for info on a web page and Googling for their local hairdresser’s phone number. Supplying the search engines its local business data likely cannibalises Yell’s main raison d’etre, leaving it to search for other income streams.

The company says it’s making 5,000 websites a week for its advertisers, and says it recently hooked up with group buying site Weforia and reputation management tool Chatterhub.

Pocock’s hints about the new strategy point to cost cuts – but Yell already made £19.2 million in savings. On Yell.com and YellowBook.com as well as in the printed Yellow Pages, Yell’s advertiser count is falling, though it is managing to extract more digital spend from fewer advertisers.

Release.

The paper says shareholders “have agreed to a new strategy for the struggling directories company, it includes a rationalisation of the business, further cost-cutting and heftier investment in digital”.

The group is caught in a typical quandary of declines from its Yellow Pages print business not being offset by its growing digital revenue. Yell.com lacks the same “go-to” status its book had in its heyday – for many, the gateway to local business search is now search itself (ie. Google), not directory.

Yell.com’s new TV ad certainly brings a smile to those of us who recall its classic J.R. Hartley commercial. But that doesn’t mean we still won’t just use Google (NSDQ: GOOG) instead…

Yell says it’s acquiring TrustedPlaces so that, “for the first time, enable consumers to recommend a local business through its Yell.com website”, which already has two million of its own listings and 399,000 advertisers.

Sounds like TrustedPlaces may even disappear as its own brand – its listings will be added to Yell.com, “leading to full integration under the Yell.com domain”, according to the release.

And Yell Group plans to spread the TrustedPlaces technology throughout its US, Spain and Latin America assets – that’s Yellowbook and Yell Publicidad respectively.

Yell’s UK new media president Mark Canon, in the announcement:

– Online: Yell.com lost 8.3 percent of its advertisers and 9.3 percent of its website users – but it managed to extract 8.7 percent more money from those advertisers (average £839pa), so UK web income rose 7.1 percent to £176.2 million.

– Print: But Yellow Pages lost 14.1 percent of its advertisers and didn’t manage to charge them more for the privilege – so the printed business saw income slim by 18.8 percent to £409.9 million.

So, in the UK, Yell.com is now approaching half the size of the Yellow Pages business, 29 percent of the whole business revenue.

2009, of course, was a particularly bad time for classified operators. By rights, Yell.com might have attracted more advertisers to the online medium – more refugees from relatively expensive, inefficient print advertising – but, unlike the likes of Google (NSDQ: GOOG), Yell is not predominantly a search ads operator.

Across the company, Yell Group revenue fell 11.5 percent to £2.12 billion, but the company swung back to a £46.8 million profit from last year’s £1.14 billion loss, which was incurred mostly because it wrote off the value of its Hispanic division.

In the U.S., Yellow Book print and online revenue went in opposite directions by almost exactly the same proportion – 18.5 percent down and 18.2 percent up respectively. But, again, print is the bigger part of the business, internet only 16 percent, so U.S. revenue dipped 14.2 percent to billion.

CEO John Condron now says he will be leaving before May 2011, while chief financial officer John Davis is also leaving.

Release.

– Yellow Pages: In the nine months to December 31, Yell’s infamous printed directory here in the UK, which publishes 76 regional editions, lost 9.4 percent of its revenue, down to £367.4 million, and 9.2 percent of its advertisers, down to 287,000.

– Yell.com: Online, Yell.com got 20.5 percent more income at £122.3 million and 4.8 percent more advertisers at 217,000, while monthly unique users grew to 40.3 million through yet another redesign. The bottom line is, Yell is managing to convert more printed advertisers to its website, but it’s still not quite enough to pick up the slack – though the customer base is approaching the size of Yell’s printed base, the online ads are much cheaper, accounting for 15 percent of group income.

Overall in the UK, Yell saw a 3.7 percent revenue dip to £507.7 million. Group-wide, however, revenue was up seven percent to £1.65 billion – despite its Yellowbook US operation losing five percent of its print income, online sales there ballooned 107.4 percent to $165.5 million. Group pre-tax profit was 2.4 percent lower at £518.7 million.

The outlook is for organic revenue to dip by 12 percent for the three months to March 31. CEO John Condron: “The economic trends in each of our markets show no current sign of returning to growth … We have deliberately reduced focus on chasing new customers, because typically the loyalty rates … are significantly lower and because prospecting for new customers is more effective when the economy is stable or growing.”

Results

(Photo: sbisson)

Local listings directory business Yell is merging its mobile division into its main digital department as part of a £100 million restructure that will also cost 1,300 jobs globally in the next ten months, including 350 in the UK, reports NMA. Head of mobile Carey Bunks, who joined in 2006 and worked on the development of Yell.com’s mobile maps, is being made redundant as part of the changes. A Yell spokesperson says (via NMA): “While a difficult decision, it was an inevitable consequence of the structural changes necessary to effectively integrate Yell.com mobile and Yell.com mobile maps into the overall business.” This is a trend in the mobile space: both the BBC and News International have both recently merged separate mobile units into wider teams. When times are good there is money to develop each area of advertising and content, but in times like these separate specialist divisions are a luxury few publishers can afford.

A 41 percent hike in online sales between April and September helped Yell record only a relatively modest profit fall of 2.7 percent to £118.3 million – relatively modest, given the circumstances of what could be deadly times for the business directory business, that is.

UK web revenue from Yell.com rose 23.3 percent to £80.3 million as the number of online advertisers crept up 2.4 percent to 213,000. Monthly unique users grew 47.8 percent to 9.9 million. But half of Yell’s business is still the printed Yellow Pages, which saw its customer base slim by 8.9 percent to 204,000 – overall, Yell UK lost 16,000 customers and sales were 3.4 percent lower than the same period last year.

As we all know by now, the local classified advertising market is at great risk, and the company expects sales to dip another five percent by year’s end. So cuts are on the way. CEO John Condron: “Global economic trends show no sign of improving; therefore, we are actively working on further cost reduction programmes that will primarily benefit next year.”

FT.com: “Yell will save £150 million in the current year and £100m in 2009, with about 1,300 jobs lost in each period.” No real acquisition talk today for Yell, which was previously linked with Google (NSDQ: GOOG) et al.

Results | Slides

– US: A 78 percent hike in monthly users from last year helped Yellowbook.com score 103.6 percent better revenue at $101.6 million. The equivalent printed directory held on to all its clients and saw only 1.5 percent worse sales.

– Spain: In one way, the Spanish online market is absolutely tanking for Yell. It lost a whopping 53.9 percent of its web advertisers, but nevertheless saw income grow 10.8 percent to