Owner of Capital Radio, Classic and Xfm, GCap Media, today announced a profit fall of 32.3% to £8.4 million. Total revenues for the same period fell 8.4% to £102.2 million.

GCap chief executive Ralph Bernard, said: "Looking ahead, we anticipate tough trading conditions will persist over the next quarter. Visibility remains low,"

Bernard added that it was too difficult to talk about overall recovery for radio revenues in general, although Capital Radio's fortunes were expected to improve towards the end of 2007.

Bernard also said Michael Grade's move from the BBC to rival ITV was "excellent news" for the commercial sector, saying it "underlines the fact that there is still a very healthy market in traditional media."

"The key point here is that we believe that Michael has not been brought in to cut costs. Michael is there principally to give confidence to the sector and to improve content," Bernard said.

The company is soon to launch a national digital jazz station, replacing Primetime on the Digital One national DAB multiplex.

GCap has said it hopes that new station will do for jazz what Classic FM has done for classical music, making it more accessible to a mass market.