Guardian News & Media reports £69m loss in year end report, 50K new digital subscribers can not make up for advertising losses
UK-based media company recently went through a round of staff cuts, eliminating over 250 positions through a voluntary redundancy program, and wants to achieve a 20% reduction in costs over the next three years
Thanks to Donald Trump’s latest press conference (see here for details on how the press is reporting it), I completely forgot that Guardian News & Media would be reporting its year-end earnings today. I caught up, and it wasn’t good.
In brief, the publisher reported losses of £69m for the last financial year, which ended at the end on April 3rd. Group revenue fell less than 4 percent, which is actually not bad – but digital fell, as well, and that certainly is not good. Total losses in the last year were £173 million after a write-down of assets and other charges. The pre-tax loss ended up being £68.7 million.
Neil Berkett, chair of GMG, presented a positive message, as well as support for CEO David Pemsel, and editor-in-chief Katharine Viner:
“These full-year financial results show the challenging market conditions in which all news organisations are now operating. Under the leadership of Katharine and David the group has committed to a three-year business plan which will address those challenges head on, addressing costs whilst growing new revenues in order to protect Guardian journalism in perpetuity.”
There was some good news in the report, though some of it also would lead to some questions. For instance, Guardian US can now claim almost 42 million unique monthly users, but as media companies are quickly learning, growing audience does not automatically lead to revenue gains (it’s hard to believe that still needs to be understood).
The Guardian is pushing an effort to get readers to become ‘members’ – a somewhat vague term that implies that the reader is donating to the newspaper to keep it going. There are three membership levels – supporter, partner and patron – costing from £49 to £149 to £599.
“What we’ve got to work out, is it a donation, someone just saying I want to keep the Guardian open and free to all? Is it in exchange for value – you give us a bit more and it’s a bit more personalised? Actually the banner of membership could be a whole number of different iterations about how we build deeper relationships with our readers and get them to make a greater contribution,” told Jasper Jackson, assistant media editor at the Guardian.
“We want to deliver on membership, we want Labs to succeed, we want America to hit its numbers. If all those things work and we focus and become much more committed to addressing our cost base … we will be fine.”