Media group Chrysalis said it was still upbeat about future trading prospects yesterday.

Current results remain in line with expectations, despite annual losses from the sale of its radio business earlier this year.

The group sold its radio wing, which included Birmingham channels like Heart and Galaxy, to investment company Global Radio in a £170 million deal in June.

It was left with its music business, home to artists including David Bowie and David Gray, and a media section, which had been hit by falling demand for CDs and DVDs as customers shift to those in digital formats or pirated products. It gets 90 per cent of its turnover from sales of CDs and DVDs.

But executive chairman Chris Wright said trading for the current year was on course for expectations "with increased levels of visibility coming through as planned".

He added: "After a quiet start to the financial year, we now have David Gray's greatest hits album just out and albums in the New Year expected from Gnarls Barkley, Feeder and The Raconteurs, which gives us confidence in achieving a satisfactory outcome for the year."

Chrysalis revealed a pre-tax loss of £6 million on continuing operations in the year leading up to August 31, compared with a loss of £2.3 million the same time last year.

Pre-tax losses, before restructuring items and amortisation, reached £3.7 million, slightly better than the analysts' forecast of a loss of around £4.5 million. Revenue fell to £56.4 million from £67.9 million previously.

And Mr Wright claimed that the "relatively quiet release schedule" going into 2008 would lead to a weaker first half compared to the same period last year.

But the new releases scheduled in the next few months would give the group "encouraging visibility" for the second half, when it expects to return to its target of net publishers' share (NPS) growth of at least five per cent per year.

New Chrysalis chief executive Jeremy Lascelles said the group's NPS was likely to be flat

in the first half, and then pick up to five per cent in the second period, way ahead of the industry growth of around two per cent.

Mr Lascelles, the former chief of Chrysalis Music, took on the group CEO role from Richard Huntingford who left in September. He said the group would grow the slimmed-down business both through acquisitions and organic means.

Chrysalis said the outlook for Lasgo Chrysalis - its CD, DVD and book division - remained "extremely challenging" and the board would continue to closely monitor the performance of the business amid the tough market conditions.

Mr Lascelles said Lasgo Chrysalis remained integral to the company, and had "stayed ahead of the game in an extremely difficult market".

Lasgo Chrysalis saw core earnings fall 45 per cent to £1.7 million this year, following a 20 per cent drop in revenue to £21.3 million.

The sale of Chrysalis's radio division in July came after a strategic review it announced in February.

In one of the biggest ever radio acquisitions, it was bought by Global Radio, a private equity group set up by Irish racing magnates JP McManus and John Magnier.

The £179 million deal represented nearly 17 times the radio division's earnings for Chrysalis, and made them a profit of £141 million.

Shares closed up 0.5p at 107.5p.