Newspaper publisher Reach today restored its dividend after strong growth in its digital offering helped drive the group’s recovery after a torrid pandemic year.
Reach, which owns the Mirror and Express as well as a number of regional titles, posted a four per cent rise in revenue to £302.3m in the six months to 27 June.
Operating profit jumped by more than a quarter to £68.9m, though the figures were flattered by a slump in trading at the height of the pandemic last year.
The media group reinstated an interim dividend of 2.75p per share. In September it scrapped the payout, offering a bonus share issue in its place.
Shares in Reach rose more than seven per cent in early trading this morning.
Reach said the improved trading represented strong growth in its digital offering, which grew almost 43 per cent over the six-month period. By contrast, print declined 5.2 per cent.
While legacy print newspapers remain the biggest part of its business, digital revenue now makes up almost a quarter of total revenue, up from 19 per cent in 2019.
Reach has previously set out targets to secure more subscribers and registered readers as it looks to shift its focus away from print.
Registrations now stand at 6.7m, and the company said it was confident of hitting its target of 10m by 2022.
The group’s net cash increased from £42.0m to £54.7m at the end of the last financial year.
“Reach is transforming its prospects and with strong momentum in the Customer Value Strategy we now have a clear pathway to sustainable growth,” said chief executive Jim Mullen.
“Award-winning national and local journalism is delivering consistently higher audience engagement, supported by increased customer insight. As a result, we have been able to increase investment in journalism and the applied data technology that is key to us achieving our ambition of doubling digital growth over the medium term. The business remains strongly cash generative and is committed to delivering growth for the benefit of all stakeholders.”
The upbeat trading update comes after Reach, which owns the Manchester Evening News and the Liverpool Echo, axed 550 jobs and suffered a sharp fall in revenue and profit last year.
Earlier this year City A.M. revealed the publisher will shutter office space and make most of its employees permanent home workers.
Reach said that while first-half trading benefited from soft comparatives in 2020, this benefit would decline in the second half as trading returned to more normal levels.
However, it said it still expected growth to continue, with full-year trading ahead of expectations.