Newspaper Publisher Reports 23% Rise in Profits Following Significant Job Cuts
Reach Plc, the publisher of popular newspapers such as the Daily Mirror, Daily Star, and Daily Express, has announced a 23% increase in profits for the first half of 2024. The company, which also owns regional newspapers including the Manchester Evening News and Liverpool Echo, achieved operating profits of £44.5m during this period.
Despite a decline in print circulation and advertising, Reach Plc was able to offset these challenges through “efficiency savings”, resulting in a total revenue decline of 5.2% to £265m. The company credits major events such as the Euros, the general election, and Taylor Swift’s Eras tour coming to the UK for boosting its earnings.
Reach Plc also reported a significant reduction in operating costs, with a decrease of more than 9% equating to £22.8m. According to the company, these savings were primarily due to the restructuring efforts undertaken in 2023, which resulted in a 14% decrease in its total headcount.
This news comes after Reach Plc received criticism from the National Union of Journalists (NUJ) for its “substantial” job cuts last year. At the time, the union expressed concern that the mass redundancies were not in line with the company’s stated commitment to quality journalism. In 2023, Reach Plc cut over 700 roles, including approximately 450 in its most recent restructuring program, which also resulted in the closure of some regional news websites.
The company attributed inflationary pressures and declining newspaper readership as major challenges faced by the industry. In a statement, Reach Plc said, “The ongoing impact of 2023’s referrer deprioritisation of news” by internet giants such as Facebook and Google also contributed to a 25% decline in digital page views over the reporting period.
However, Reach Plc stated that it was now generating more revenue from page views, and that trends were “improving” as the digital advertising market stabilized. Additionally, the publisher revealed that it was actively exploring the benefits of artificial intelligence (AI) to support its editorial teams and the wider business.
Reach chief executive Jim Mullen commented on the company’s performance, saying, “I am pleased to have delivered further operational progress this year, with our commercial and editorial teams making the most of the strong news agenda.” He also added, “We continue to build a stronger, more resilient business and are on track with our plans for the year.”
The rise of online news consumption and a general decline in print readership have prompted many newspaper publishers to shift their focus to digital platforms. Earlier this year, London newspaper the Evening Standard announced its decision to discontinue its daily weekday print edition after nearly two centuries in circulation.
