Media group hit
Reach turns to data income as revenue takes dip
Digital and print revenue continued to decline at Reach, the media publisher which owns national and local news titles including the Daily Record, Daily Express and Sunday Mail.
Group revenue for the third quarter fell 7.8% year-on-year and 6.6% over nine months, with digital revenue taking an even bigger hit, down 13.7% over the quarter and 15.2% over nine months. Print revenue was 5.8% and 3.8% lower over the respective periods.
The company blamed depressed open market yields and declining digital referral volumes, in particular from Facebook’s de-prioritisation of news. As a result, over the nine-month period, year-on-year page views declined 21%.
Data driven revenue, which is higher value and more targeted, continues to be robust and now makes up a larger part of digital revenues at 42%. (FY 2019 – 24%).
In print, circulation revenue has grown marginally over the first nine months of the year. The company says this remains a resilient and predictable revenue stream as it actively mitigates the expected volume decline.
Last September 2022 saw modest advertising activity following the Queen’s death, excluding this one-off factor the quarter would trend in line with the nine-month movement.
The company said it remains confident of meeting profit expectations for the full year.
“We do not anticipate the market backdrop to change materially in the near term and as a result we remain focused on the areas within our control; improving customer engagement, diversifying revenues and driving efficiencies.
“Our plans to reduce full year operating costs by 5-6% remain on track. We expect a High Court judgement on time limitation relating to historical legal issues in the next few months.”
Jim Mullen chief executive added: “This quarter we see continued evidence that our data driven strategy is working, supported by our resilient print business. Through this challenging period we have remained focused on the controllables.
“We are delivering our Customer Value Strategy and have made progress diversifying our audience. We continue to review our cost base so that we can accelerate our digital transformation.”
Trading for the three months and nine months to 24 September
|Q3 YOY %||9 Months YOY %|
|– Circulation revenue||(3.3)||0.4|
|– Advertising revenue||(8.9)||(15.7)|