Robust trading

Scotsman owner National World seeks acquisitions

Scotsman-front-page
Print revenues have fallen but digital sales are up

Newspaper publisher National World, owner of The Scotsman, Falkirk Herald and Yorkshire Post, said it is pursuing acquisition opportunities after making a ‘robust’ start to the year.

Ahead of today’s AGM, chairman David Montgomery said: “Despite a more uncertain trading environment, we are accelerating our transformation into a premium content and sales business across all platforms.

“We continue to launch new products, invest in organic growth, enhance heritage assets and streamline our infrastructure to create further efficiencies.

“Management is pursuing acquisition opportunities to build scale and enhance shareholder value.”

In a trading update for the 21 weeks to 28 May, the company said revenue for the period is expected to grow by 4% year on year with 5% growth in the first quarter and growth of 1% in April and May.

Digital revenue is expected to grow by 38% year on year for the period, with continuing strong growth of 28% in April and May.

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Whilst the war in Ukraine has created volatility in audience numbers during the period, the revenue impact has been mitigated by stronger yields and increased video advertising, (the latter almost doubling year-on-year).

Print revenue is expected to decline by 2% in the period with advertising revenue increasing by 3% and circulation revenue falling by 7%. A marginal decline in print revenue in the first quarter has been offset by a decline of 4% in April and May driven by stronger comparatives last year. 

The national site, nationalworld.com, continues to deliver strong growth with monthly page views increasing to 20 million in April, one year after its launch.

As well as establishing this UK wide footprint from a limited regional presence, National World has launched seven Metro World brands into all major centres, including London, Birmingham and Manchester. This online-only portfolio is being further extended by three cities.

Careful cost management continues to support the group’s digital investment and helps it mitigate the impact of newsprint price rises and other inflationary cost pressures.

The group said it maintains a strong financial position with a cash balance of c.£25m at the end of May offset by £1m of outstanding loan note debt and a £2.5m deferred consideration.

It said the trading environment is challenging with market expectations of a significant slowdown in the UK economy impacting consumer confidence, driven by rising inflation and interest rates.

“However, the board remains confident that investment in and development of our digital business together with careful management of the cost base will support profits and cash flow. At this stage, the board expects performance for the year to be in line with the company’s expectations.”

Audited circulation figures for The Scotsman show the sale has fallen below 10,000. The average daily sale for the six months to the end of December 2021 was 9,852, of which 4,847 were over-the-counter sales. Scotland on Sunday‘s sale was 5,881. The Edinburgh Evening News average daily sale was 8,977.



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