Deutsche Bank has trimmed its target price for Reach PLC (LSE:RCH), the national newspaper publisher, from 182p to 175p while reiterating a buy recommendation, following full-year results that came in slightly ahead of the bank's forecasts.
Reach's shares were 57.45p (down 3%), leaving significant implied upside to the revised target.
Tuesday's prelims revealed revenue for the year fell 3.7% to £518.4 million, broadly in line with Deutsche Bank's estimates.
Adjusted operating profit reached £104.7 million, with a margin of 20.2%, ahead of the bank's forecasts of £102 million and 19.8%. Adjusted earnings per share came in at 26.8p, against Deutsche Bank's estimate of 24.3p.
The full-year dividend was held flat at 7.34p, as expected.
Net debt fell to £34.9 million, also slightly better than forecast.
Digital revenues declined 1% over the full year, but deteriorated sharply in the fourth quarter, when they fell 7.8%.
Reach attributed the weakness to a material reduction in traffic referrals from Google, compounded by broader macroeconomic pressure and tough comparatives.
Print revenues fell 4.6% over the year, with print advertising down 14.8% and circulation revenues declining 3.4%.