The UK’s largest publisher is set to exceed financial expectations for 2024, thanks to a solid end to the fiscal year and increased digital revenues.
Reach, the parent company of prominent British publications such as the Daily Mirror and the Express, has announced that its annual financial results for 2024 will surpass initial expectations, bolstered by a robust finish to the fiscal year. The company, which also oversees the Daily Star and various regional titles, is forecasting underlying annual earnings of £97.8 million, following a reported underlying operating profit of £96.5 million for 2023.
The report is notable as it is one of the few major UK news publishers that makes its performance public by virtue of being a public company. It will also be a welcome fillip for management who have pushed through a series of unpopular measures, such as page view targets for reporters, alongside staff reductions in the past 12 months.
In its recent communication, Reach indicated that it would incur a £5 million charge in 2025 associated with its West Ferry Printers Pension Scheme, a liability acquired during the purchase of the Express titles in 2018. The company revealed the discovery of a “historical error” during the due diligence process related to the pension scheme buyout, which necessitated the additional funding. “We have reviewed our other schemes for the same error, and we have not identified any material items,” Reach said.
The fourth quarter of 2024 was characterised as “strong” by the group, though specific details regarding trading performances were limited. Notably, Reach reported a 2.5% uptick in digital revenues in the third quarter, signalling a positive outlook for digital profitability in the concluding months of the year. This growth is particularly significant given the ongoing challenges faced by traditional media outlets due to shifts in platform algorithms, particularly those of social media giants such as Meta, which have preferentially promoted user-generated content over news articles. This transition has posed considerable challenges for legacy media companies reliant on digital referrals for traffic.
Despite experiencing a 3.9% decline in print turnover during the third quarter, Reach implemented cover price increases and promotional campaigns to mitigate the impact of falling circulation figures. The group has also reduced operating costs, reporting progress ahead of its target of 5%-6% savings established at the beginning of the year.
Reach is scheduled to release its full-year financial results on March 4, and the industry will be closely monitoring these figures, especially in relation to the continued adaptation and monetisation strategies employed by traditional publishers grappling with the digital transition.
Source: Noah Wire Services
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Corroborates Reach’s financial results, including the forecast of underlying annual earnings and the details on digital and print revenue performance.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Provides information on Reach’s cost reduction targets and the progress made in reducing operational costs.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Details the company’s performance in the third quarter, including the 2.5% uptick in digital revenues and the decline in print turnover.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Mentions the company’s outlook for the full year and the market expectations compiled by the company.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Discusses the impact of cost management and the improvement in operating profit margin.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Provides context on Reach’s portfolio of publications, including the Daily Mirror, Express, and Daily Star.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Mentions the historical error related to the West Ferry Printers Pension Scheme and the additional funding required.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Details the cover price increases and promotional campaigns to mitigate the impact of falling circulation figures.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Corroborates the scheduled release date of the full-year financial results on 4 March.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Provides insights into the company’s adaptation and monetisation strategies in the face of digital transition challenges.
- https://www.reachplc.com/content/dam/reach/corporate/documents/results-and-reports/2024/hy24-results-statement.pdf.downloadasset.pdf – Discusses the importance of AI applications and innovative business models for the sustainability of traditional publishers.
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