REG - Reach PLC - Trading Update

ReachAnnouncement

03/05/2023 07:00

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RNS Number : 1835Y  Reach PLC  03 May 2023

 

 

3 May 2023

Reach plc - Trading update for the 4-month period to 23 April 2023

                              FY23 in line with
expectations; cost actions offset continued challenging trading

Reach plc ('the Group') is issuing a trading update for the 4-month period to
23 April 2023 ('the period'), ahead of its 2023 Annual General Meeting today.

                                            Period

                                Year on year  %
 Digital Revenue                (14.5%)
 Print Revenue                  (3.0%)
 -     circulation revenue      2.1%
 -     advertising revenue      (19.2%)
 Group Revenue                  (5.9%)

 

Year to date group revenue in-line

Group revenue for the period was down 5.9%, against strong comparatives,
broadly unchanged from the year to date performance highlighted in our full
year results in March, and in line with our expectations.

Print revenue has remained strong. Volumes remain robust, with circulation
revenue benefitting from cover price increases during FY22, with advertising
slightly ahead of our expectations.

While macroeconomic conditions mean the overall market for digital advertising
is challenging, data-driven revenue continues to outperform. Reduced demand
continues to be reflected in lower sector yields, particularly in the open
market. The page view slowdown, referred to in March, has continued, with
recent changes to the way Facebook presents news content, causing a reduction
in referred traffic across the sector.

Our investment in the US continues to  progress. We currently have almost 100
full time roles in place and expect to launch US domain websites for both The
Express and Mirror over the next few months.

Operating cost action plan on track

As previously announced, we expect a reduction in operating costs of between
5% and 6% during FY23 -actions to deliver this are well advanced, with most of
these savings to be realised during H2.

Outlook

Looking forward we expect to benefit from, strategic actions to address the
decline in page views, expansion in the US and a reduction in operating costs.
In addition, H2 digital comparatives are less demanding, mainly due to
suppressed Black Friday and Christmas trading last year. Profit expectations
for FY23 remain in-line with market consensus.((1))

Jim Mullen, Reach plc Chief Executive

"External factors continue to impact digital revenue, delivery of the customer
value strategy is driving a higher quality mix, underpinned by the strength of
print. Our focus on data, means customers are receiving and responding more
often to relevant content and a more engaging user experience. Our scale, US
expansion, strategic delivery and strong balance sheet give us confidence for
the future."

Notes

((1)) Market expectations compiled by the company are an average of analyst
published forecasts - consensus adjusted operating profit for FY23 is £95.3m
(range from £93.7m to £96.5m)

Enquiries

Reach
        communications@reachplc.com

Jim Mullen, Chief Executive
Officer
 

Darren Fisher, Chief Financial Officer

Lija Kresowaty, Head of External Communications

Matt Sharff, Investor Relations
Director
          +44 (0)7341 470 722

Teneo
 
          reachplc@teneo.com

Giles Kernick
 
          +44 (0)207 353 4200

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