(Alliance News) - Reach PLC on Thursday ahead of its annual general meeting reported a solid start to the year, with growth in digital revenue lending confidence that annual profit for the media firm will be ahead of market expectations.
For the four months ended April 25, the London-based owner of the Daily Mirror, Daily Star and Daily Express newspapers brands said group revenue for the period was down 3.1% year-on-year.
Although Print revenue declined 10%, with circulation down by 7.9%, Reach's Digital business had a strong trading performance, with revenue rising 35% as the segment starts to account for more of the group's advertising revenue than print.
In addition, Reach reported a rise in registrations, standing at 6.2 million to date, up from 5.8 million at the start of March. Looking ahead, the company remains on-track to reach 10 million registrations by the end of 2022.
Looking ahead, although Reach admitted that its revenue performance had been flattered by softer comparatives at the start of the Covid-19 pandemic, underlying momentum has been encouraging, particularly on the digital front, where Reach has made progress in commercialising a new portfolio of products, it said.
As a result, Reach expects adjusted operating profit for its current financial year to be ahead of market expectations, which stands at GBP137.1 million. Adjusted operating profit was GBP133.8 million in the financial year that ended December 27 last year.
"We have had a positive start to the year and are seeing the benefits of last year's transformation programme. With digital now accounting for more of our advertising revenues than print and growing strongly, we are well placed to make further progress during 2021. We have a strong balance sheet and are now increasing investment to accelerate delivery of the Customer Value Strategy, focusing on the use of enhanced customer insight to drive engagement and support our medium-term objective of doubling digital revenues," said Chief Executive Jim Mullen.
Shares in Reach were down 0.1% at 219.70 pence on Thursday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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Reach Plc (RCH)