View all newsletters
Sign up for our free email newsletters

Fighting for quality news media in the digital age.

  1. Media Business
August 10, 2012updated 07 Sep 2012 3:13pm

Guardian Media Group posts £76.6m pre-tax loss

By Andrew Pugh

The Guardian’s parent company Guardian Media Group has reported pre-tax losses of £75.6m in the last financial year.

GMG said the loss, which contrasts with pre-tax profits of £9m in 2011, was down to an exceptional charge relating to the sell-off of its subsidiary GMG Radio.

The company’s annual report published today, covering the year to March 2012, also revealed that the combined value of its cash balance and investment fund has risen from £197.4m to £225.8m, reflecting dividends from its shares in Trader Media Group (TMG).

Revenue was down slightly at £254.4m (2011: £255.1m) and the company recorded operating losses before exceptional items of £64.4m, up from £54.5m in 2011.

Chief executive Andrew Miller said: “It is to be expected that as we invest in the future of the Guardian, we will see some increase in GMG’s losses.

“Overall, our portfolio of assets performed well, although a non-cash impairment in the value of our radio business had a negative impact on the Group’s pre-tax loss figure.

“The view of the Board is that the ongoing value of our assets is more than sufficient to see us through this period of change.”

Content from our partners
MHP Group's 30 To Watch awards for young journalists open for entries
How PA Media is helping newspapers make the digital transition
Publishing on the open web is broken, how generative AI could help fix it

Today’s report said GMG was now targeting cost savings of at least £25m over the course of the five-year plan announced in 2011.

“This will be a tough and sometimes painful challenge,” said Miller, adding: “I would like to thank staff for their continued understanding and commitment as we go through these difficult times.

“It is vital that we succeed if we are to be able to fully implement our strategy of investing in digital through continued product growth.

“It is only by achieving the necessary levels of cost savings that we can provide the headroom to fund our digital future.”

Elsewhere, digital revenues for the year grew by 16.3 per cent to £45.7m, which the company said “largely off sets the decline in print revenues”.

Despite announcing its “digital-first” strategy last year, Miller said that this "in no way detracts from our love of printed newspapers or our desire to see them flourish".

Operating profit at Trader Media Group – a joint venture with Apax Partners – grew to £128.7m, up from £118.6m in 2011, with 83% of revenues now coming from digital.

GMG’s second joint venture with Apax Partners, Top Right Group (formerly known as Emap), returned to profit growth. Underlying operating profit was £78.7m compared with £76.3m in 2011.

Dame Amelia Fawcett DBE, chair of GMG, said: “At Guardian Media Group (GMG), securing a sustainable future for quality journalism has been our number one priority during the last year.

“It is, by any measure, a stretching task. Media organisations across the world are struggling to match growth in digital audiences with growth in digital revenues."

She added: “The increase in GNM’s operating loss is in line with our projections and reflects planned investments. These critical investments have been made possible through the headroom provided by large-scale savings.

“This gives us great confidence that GNM will meet its target of reducing losses to a sustainable level over a five year period.

“Achieving this goal will require a huge collective effort from everyone across the whole of GMG. Difficult decisions will need to be made and major changes implemented.

“The next few years will be very challenging and we will need to be ready to revise our plans should economic and market conditions worsen.

“The prize is a secure future for the Guardian’s journalism, and there can be no better illustration of how important that is than the extraordinary editorial achievements of the past year.

“Our journalistic output has never been better or as widely consumed, something of which everyone across the Group can be proud."

Last month, Guardian News and Media reported a 15 per cent rise in operating losses to £44.2m for the year to March 2012.

Revenue is understood to have fallen slightly to £196.2m from £198.2m in 2010/2011.

Email pged@pressgazette.co.uk to point out mistakes, provide story tips or send in a letter for publication on our "Letters Page" blog

Select and enter your email address Weekly insight into the big strategic issues affecting the future of the news industry. Essential reading for media leaders every Thursday. Your morning brew of news about the world of news from Press Gazette and elsewhere in the media. Sent at around 10am UK time. Our weekly does of strategic insight about the future of news media aimed at US readers. A fortnightly update from the front-line of news and advertising. Aimed at marketers and those involved in the advertising industry.
  • Business owner/co-owner
  • CEO
  • COO
  • CFO
  • CTO
  • Chairperson
  • Non-Exec Director
  • Other C-Suite
  • Managing Director
  • President/Partner
  • Senior Executive/SVP or Corporate VP or equivalent
  • Director or equivalent
  • Group or Senior Manager
  • Head of Department/Function
  • Manager
  • Non-manager
  • Retired
  • Other
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
Thank you

Thanks for subscribing.

Websites in our network