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Independent revenues up by 12 per cent with 'marginal' drop in profits put down to editorial investment

The Independent has grown its revenues by 11.5 per cent in a year, with a “marginal decline” in profits attributed to investment in its editorial teams, full-year accounts showed today.

The title, which went digital-only with the closure of the print newspaper in 2016, reported a turnover of £24.8m for the year ending September 2018, up from £22.2m the year before.

The company said the growth was partly down to agency sales and network and programmatic revenues.

“There was also a very strong performance in digital-specific licensing and syndication revenues, whilst subscription revenues from The Independent Daily edition app remained broadly stable,” a statement accompanying the Independent Digital News and Media accounts on Companies House said.

The cost of reading the Independent’s digital edition on its app is £12.99 per month or £149.99 annually.

The company said these factors had helped to offset the “negative effect on turnover” of Facebook’s algorithm change in early 2018 which meant platform’s news feed began to show less content from publishers and advertisers in favour of “meaningful social interaction”.

The Independent is continuing to address this drop in traffic by “optimising search engine driven audiences”, it said, which saw a 33 per cent increase in visits in 2018.

Pre-tax profits and operating profits both fell 6 per cent year-on-year from £3.3m to £3.1m.

The company said the “marginal decline” in operating profits came as a result of “continuing investment” in the UK and US editorial teams and an expansion in its network of foreign correspondents.

The title appointed three-time Pulitzer Prize finalist Borzou Daragahi as international correspondent as part of an “ambitious expansion” of its overseas staff, it said in September two months after hiring former Times reporter Bel Trew as Middle East correspondent.

There has also been “significant” investment in the development and launch of Independent Minds, the brand’s subscription service which launched in September.

Readers who sign up for £5.99 per month get access to an ad-free live website and app experience with other perks such as exclusive email bulletins and free tickets to events under a partial paywall model.

The results marked the Independent’s second year in a row in the black.

in its first full year as a digital-only title, the Independent increased its turnover by more than 55 per cent and nearly doubled its profits to £3.26m in 2017, an increase of 94 per cent.

Manish Malhotra, group managing director at parent company ESI Media, said: “The Independent has continued its impressive growth trajectory as the biggest pureplay digital-only newsbrand in the UK.

“Continued turnover growth as well as profit stability demonstrates the success of its commercial and content strategy.”

The company accounts went on to say that since the end of September last year, the Independent has “continued to deliver strong audience and revenue performance in line with its business plan”.

The group aims to continue building its subscription revenues through Independent Minds and bolstering licensing revenues through a partnership to distribute the Independent in Arabic, Persian, Turkish and Urdu.

“The success of such initiatives will ensure the group is well placed to continue investing in high quality journalism as well as expanding its commercial, data and technical capabilities,” it added.

Full-year financial results for ESI Media sister title the Evening Standard published yesterday showed the free newspaper and its website had made a pre-tax loss of £11m for the second year in a row.

Malhotra said the planned integration of the Standard’s print and digital editorial teams and recent investment into the title “will allow us to build towards a profitable and sustainable future”.

The overall fortunes of Lebedev Holdings, which owns the media assets of Standard and Independent owner Evgeny Lebedev, were down in 2018, with a pre-tax loss of £18.6m compared to £18.3m in 2017.

The holdings company also reported an operating loss of £13.2m, up from £12.9m, although revenue stayed steady at £68.5m.

Its overall newspaper publishing revenues were up from £64.3m in 2017 to £65.4m, while broadcasting revenues from the London Live TV channel fell by a quarter from £4.2m to £3.1m.

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