Pre-tax profits at Telegraph Media Group were up by a third in 2021 as its subscription-first strategy continues to drive growth.
Digital subscription revenues grew by 40% to £44.1m, which the company said was ahead of expectations. Overall revenue was up by 4% to £245m.
The Telegraph introduced a subscription-first strategy several years ago and is targeting one million paying subscribers and ten million registered users by the end of 2023.
The title reached 720,000 subscribers in December and has since topped 744,000 (made up of 577,720 digital and 167,000 print). Registered users were at seven million in December 2021, up from 6.6 million a year earlier.
In a report of its financial results for the year ending December 2021, published on Wednesday, TMG said its pre-tax profits had reached £29.6m, up from £22m in 2020 and £6.2m in 2019.
Operating profit before exceptional items was up by 25% to £33.3m, which TMG said was “driven by the growth in digital subscriptions, continued strong cost management and positive results from transformation activities” – the latter including the outsourcing of print advertising revenue generation to DMG Media in May 2021 which was described as “extremely successful to date with positive trading performance and the successful move from a fixed to a more variable cost model”.
Earnings before interest, taxation, depreciation and amortisation were up by 8% to £40.4m before exceptional items.
Subscription revenues now make up 46% of turnover for Telegraph Media Group and it is expected this will top 50% in 2022. The title currently reports an average revenue per subscription of £171.36.
TMG chief executive Nick Hugh (pictured) said: “We have continued to invest in our high quality, trusted and award winning journalism including the successful launch of the new version of our app… Material investment in journalism, technology platforms and digital operations will continue in 2022.”
According to the publisher, it created 71 net new editorial roles in 2021, an increase of 29 on 2020.
The new Telegraph app went live in April 2021, combining the two previous offerings which respectively offered news as it appeared on the website and digital versions of the print editions. Press Gazette analysis this month showed it was the eleventh most popular news app in the UK in March, reaching an audience of 756,600 people. The Telegraph said 240,000 subscribers use the app each day, as of April.
The company said it “currently anticipate[s] that the profitability
will increase further in 2022, despite the continued structural decline in
print and advertising revenues and well documented inflationary pressures”.
The fact that growth continued despite challenges like the Covid-19 pandemic exacerbating declines in print circulation and advertising revenue and looming regulatory developments on privacy and third-party cookies has reaffirmed TMG’s commitment to its subscriber strategy, it added.