Daily Mail & General Trust has axed 1,500 staff from its consumer media businesses in the past 11 months as part of wide-ranging cuts that have resulted in the business making a £150 million saving.
The company said today it was confident that full year results would meet market expectations as a result of its cost reduction programme. Current City expectations are for a profit before tax this year of £182m.
Despite the savings overall group revenue was down nine per cent year on year in the 11 months to the end of August, DGMT reported today.
Revenue from DMGT‘s consumer wing was 15 per cent lower in the 11 months to the end of August than in the same period the previous year, the company reported today.
The company’s consumer business includes its national and regional newspaper businesses, respectively Associated Newspapers and Northcliffe Media, an Australian radio business and a smaller central European publishing business.
Issuing a trading update this morning, ahead of full-year results in November, DMGT reported that it had achieved cost reduction targets set earlier this year for A&N Media – Northcliffe and Associated collectively – helped by reducing the workforce by 15 per cent in its consumer media division.
This included job losses from the closure of three regional printing plants at Grimsby, Leicester and Bristol. The figure will also be enhanced by the sale of a controlling share of the London Evening Standard to the Russian billionaire Alexander Lebedev in February.
The cost saving measure helped DMGT as it struggled to generate income from its newspaper businesses.
Regional publishing division, Northcliffe Media, reported a fall in ad revenue of 31 per cent year on year in the 11months to the end of August, with circulation revenues falling seven per cent.
DGMT said that weekly levels of advertising had stabilised in recent months and year-on-year rates of decline were now showing improvements.
Advertising revenue was 26 per cent down in July and August, with continuing improvement in September, especially in property. However, DMGT said trading conditions remained difficult in its regional division.
Associated Newspapers, which publishes the Daily Mail and Mail on Sunday, saw ad revenue fall by 16 per cent on a like for like basis over the period, with circulation revenue down two per cent.
DGMT said: “Associated’s total advertising revenues in July and August were down by 21 per cent, September has been better, although trading remains volatile from week to week with little visibility on future advertising performance.”
The company’s business to business operations reported a rise of two per cent during the period, helped by the strength of the dollar.