Media group Chrysalis yesterday attributed a bad set of half-time results to timing factors which should partly be reversed in the second six months.
The announcement followed Monday's deal in which Chrysalis bought the East Midland radio station Century 106 for £29.5 million to balance its Heart FM franchise in the West Midlands,
Music royalties from successful albums released in the first half-year will fall in the second, at the same time, more books than usual will be launched in the second half-year.
But advertising revenues, which showed signs of recovering early in 2005, have fallen back again since Chrysalis's February year-end - though this was partly due to an absence of Government ads during the run-up to the general election.
Much as expected, half-year profits fell to £265,000 from £2.22 million. The fall was less steep without exceptional items and goodwill amortisation - to £ 1.2 million from £ 3.0 million. Sales slipped to £78.4 million from £82.4 million.
The shares eased back 4p to 140p as the house broker Kleinwort Dresdner Wasserstein trimmed its full-year forecast to £5.5 million from £7 million.
Although Century 106's East Midland franchise is a separate regulatory entity, advertising can be sold in the same package as Heart FM's in the West Midlands.
"This gives them coverage in the same area as the Central ITV region," a spokesman pointed out. "That is attractive to advertisers."
Chrysalis also own the Galaxy West Midlands station aimed at younger listeners.
Chris Wright, Chrysalis's chairman, commented " Century 106 is a well established, profitable broadcaster and will allow us to create a leading Heart branded, adult contemporary offering across the East and West Midlands - an area attractive to both local and national advertisers.
"We anticipate being able to grow both the audience share and yield for the station towards that enjoyed by the Heart West Midlands station.
"There is also scope for some margin improvement due to economies of scale which can be exploited across the Chrysalis Radio division."
Overall, though, the company said it is taking a cautious outlook for the remainder of the year, adding that full-year sales for Chrysalis Radio may show a decline of five to six per cent.
On Chrysalis Music, the company said it is confident the division will continue to perform well.
Chrysalis said the ongoing consolidation of the UK radio sector is likely to offer further interesting opportunities for Chrysalis Radio.
Shares in Chrysalis closed last night down 4p at 140p.