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(Alliance News) - Daily Mirror newspaper publisher Reach PLC on Thursday said coronavirus is hurting circulation sales and print advertising revenue, but there has been an "unprecedented" demand for news and content across the company's digital titles.
Shares in Reach were up 11% at 78.84 pence each in London.
The British publisher said it has, since mid-March, has seen "declines in circulation sales, falls in print advertising revenue at a national and local level, reduced printing requirements from third parties, impacts from cancelled events and a reduction in digital yields due to lower advertising demand".
"Despite this we have seen unprecedented demand for news and content across our digital titles, with 42 million online users in the UK in March, ensuring Reach retained its position as the 5th largest UK online property. April saw total page views of 1.7 billion, average daily app users rose by 47% to 674,000, and our hyperlocal news platform InYourArea surpassed 650,000 registered users," Reach added.
For the four months to April 26, Reach saw a 13% drop in group revenue, with print revenue down 16% and digital revenue up by 4.7%.
April represented a full month of impact from the lockdown and resulted in a 31% drop in revenue, the company said. April print revenue fell 32% and digital revenue declined 23%, with higher page volumes not able to offset declines in advertising yields.
"While in some areas we have recently seen a stabilisation in trends, circulation remains significantly below pre-Covid-19 levels and advertising remains very challenging and uncertain, with regional advertising particularly impacted," the company explained.
Reach said to conserve cash it has decided to defer pension contributions by three months, which has been agreed by the pension fund. In April, the company announced several steps to save cash, including pay reductions, suspensions of bonus schemes, furloughing of several staff, and cancellation of the 2019 final dividend.
As at April 26, Reach had a net cash surplus of GBP33.2 million, it said.
The company predicts revenue performance for 2020 to be significantly impacted by the Covid-19 crisis. However, the cost-savings measures are estimated to partially protect profitability levels and cash generation.
By Tapan Panchal; tapanpanchal@alliancenews.com
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