Shares in Reach PLC (LSE:RCH) grabbed a 15% gain on Tuesday morning after the national and regional news publisher said it was coping with Facebook’s deprioritising of news with “more sustainable digital revenues”.
Group revenue for the Daily Mirror, Express and Star publisher was down 6.1% to £279.4mln for the half-year to 25 June 2023 and statutory operating profits fell 68% to £11.1mln, the interim results revealed.
Underlying operating profits fell 23% to £36.1mln and the company, which also publishes the Daily Record, Manchester Evening News, Liverpool Echo, Bristol Post and WalesOnline among many others, said it was “on track” to meet full-year profit expectations.
Print sales were down 2.7% while circulation revenue rose 2%, with advertising down 18% and digital revenue down 16.1%. But “data-driven revenue” grew to 41% of digital from 35% a year ago and 24% in 2019.
In spite of Facebook's algorithm changes driving page-view declines for all publishers, Reach chief executive Jim Mullen said the company was “driving more diversified, higher performing revenues, with greater exposure to directly sold, higher value advertising”.
He said print sales offered “resilience and predictability”, while cash generation was being supported by cost-cutting, which was “on plan and expected to support a stronger second half performance”.
The establishment of a US operation was among the new developments, where there is an editorial team of more than 30 working on Express.com, with Mirror.com going live in “coming months”, while other innovations are continuing, including agreements to share data from its Mantis brand safety and contextual advertising platform with Google and Amazon and trialling metered paywalls.
The shares, which hit a 14-year high above 400p during the pandemic before tumbling to below 70p last year, recently sank below that level in the run up to these results, before climbing to 79p in early trading.