Mirror and Express owner Reach bumps up trading expectations

Sebastian McCarthy
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Trinity Mirror Buys Express Newspapers For £127 Million
The owner of the Daily Mirror agreed to buy the company behind titles including the Daily Express, the Daily Star and magazines such as OK! in February (Source: Getty)

The publisher of the Mirror and Express newspapers saw its share price climb more than five per cent this morning after saying that trading for the year will finish “marginally ahead of market expectations”.

Reach, the company name adopted by Trinity Mirror after it acquired Richard Desmond’s media portfolio in February for £127m, reported a rise in revenue in the wake of its acquisitions.

The figures

Group revenue jumped 23 per cent in the fourth quarter of the year, while revenue on a like-for-like basis dropped five per cent.

Reach forecasted circulation revenue and print advertising revenue to fall by four per cent and 15 per cent respectively on a like for like basis.

However, the company said that digital revenue is expected to rise by five per cent.

The company said that integration of Express & Star was progressing well and the firm expects to deliver £3m of synergy savings in 2018, ahead of the £2m forecasted in October.

Reach added that it remained on track to deliver at least £20m of annual savings per annum by 2020.

For the year ending 30 December, Reach said the market consensus range for adjusted profit-before-tax was £132.2m to £133.9m.

Why it's interesting

Reach has been buoyed by rising digital revenue alongside its acquisition of Daily Express and the Star in recent months, having acquired its new titles from media mogul Richard Desmond earlier this year.

Yet the publisher, which also owns the Sunday Mail and Daily Record, is still facing many of the same woes as its rivals in the print industry, especially in its local journalism arm where readership numbers are plunging.

It has been half a century since the Mirror and Express were Britain’s two largest selling papers. In that time the Fleet Street giants have seen their numbers dwindle, and today’s circulation figures suggest there are few signs of improvement.

Online news organisations have also had to adapt their models in the last 12 months, with many advertisers starting to put more of a focus on readership engagement as opposed to volume of clicks.

What the company said

Chief executive Simon Fox: “I am pleased with the improved trading in the final quarter. This coupled with continued tight management of the business provides me with confidence that performance for the year is expected to be marginally ahead of expectations. We head into 2019 having made good progress with the integration of Express & Star and with clear plans in place for driving digital growth in the year ahead.”