Mirror, Express and Star publisher Reach has said it is “on track” to make £2m in savings this year, part of a bid to cut at least £20m a year by 2020, as it publishes a third quarter trading update today.
Group revenue at Reach (formerly Trinity Mirror) fell by 7 per cent on a like-for-like basis for the period, but, when the purchase of the Express and Star newspapers is taken into account revenue grew by 21 per cent.
Like-for-like counts the Express and Star newspapers as if they had been owned by Reach from the start of 2017.
Reach bought the Daily Express, Daily Star, Sunday Express and Daily Star Sunday from Richard Desmond’s Northern and Shell in a deal worth £127m in February this year.
In a trading update for the third quarter of 2018, issued today, Reach said circulation and publishing revenue was down 4 per cent while print advertising revenue had fallen by 20 per cent.
But, digital publishing revenue had grown by 7 per cent, while display and transactional revenue growing by 12 per cent, the group said.
Reach is set to axe more than 70 editorial jobs following the buyout of Express and Star newspapers.
Reach chief executive Simon Fox said: “I am pleased with the progress being made on the integration of Express and Star and remain confident that we will deliver at least £20m of annual synergy savings by 2020.
“Our continued focus on tightly managing costs and driving digital revenue continues to provide confidence that performance for the year will be in line with market expectations.”
Reach’s board has said it “remains confident that performance for the year will be in line with market expectations”.
The company said market consensus is that Reach’s profit before tax for the year to 30 December 2018 will be between £132.1m and £133.9m. That would be up on 2017, when Reach made £122.5m profit before tax.
Last month Reach sold off email marketing business The Communicator Corporation LTD, which it wholly owned, for £7.6m, of which a remaining £0.8m will be paid in March 2020.
In 2017, the Communicator Corporation made revenue of £4.9m and operating profit of £0.9m.
Picture: Reuters/Simon Dawson
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