News Column

Guardian and Observer trim losses to pounds 30.6m: Guardian News & Media's total revenues rise 6.8% Mobile apps help boost digital earnings by 24%

July 9, 2014

Mark Sweney

The Guardian and Observer narrowed losses to just over pounds 30m in the year to the end of March, as income from print operations remained resilient and digital revenues grew by almost a quarter.

The loss before interest, tax and amortisation of pounds 30.6m followed a restated loss last time of pounds 33.8m.

Andrew Miller, the chief executive of the parent company, Guardian Media Group, received pounds 2.16m in total remuneration after a pounds 1.41m payout relating to the sale of the company's stake in the parent of AutoTrader, in a deal that valued the car sales site at pounds 1.8bn.

Miller spent a decade as finance chief at Trader Media Group, transforming it into a digital business, and GMG said the payment "was calculated in accordance with a contractual agreement and was directly linked to the sale price agreed".

Guardian News & Media, the news operation that includes, reported a solid 6.8% rise in total revenues to pounds 210.2m for the year to the end of March.

Print revenues remained flat year on year at a little over pounds 140m, a strong performance in a market that is typically seeing declines.

But digital revenues continued to show strong growth, up 24% to pounds 69.5m, with the recently relaunched mobile apps attracting 840,000 users, and those opting for the paid-for premium version 150% ahead of planned subscriber numbers.

GMG said if certain charges were stripped out, most notably a non-cash accounting charge relating to Guardian Australia, the truer picture of operating losses at GNM was pounds 19.4m. Guardian Australia is funded by the internet entrepreneur Graeme Wood.

Alan Rusbridger, the editor-in-chief of GNM, was paid pounds 491,000, including a base salary of pounds 395,000, the same as he received the previous year.

The pounds 2.16m in remuneration for Miller included a base salary of pounds 696,000 plus pension contributions of pounds 53,000. A separate bonus of pounds 226,000 has been deferred for a year. The company said Miller had waived pounds 457,000 in bonus payments over the past four years.

Overall, the company employed 1,539 staff and paid pounds 119.5m in wages.

The sale of AutoTrader helped GMG report a pre-tax profit of pounds 549.2m. In turn, this has meant the cash and investment fund that must support the newspapers has grown threefold to pounds 842.7m.

The company has no plan to use the funds for a major acquisition; instead, most of it will be invested with an aim of a real return of 5% to support an annual loss level of about pounds 40m. However, the plan is to reduce GNM's losses well below this level.

Miller said it was an "important milestone" that, following the fillip for the investment fund, losses fall within this level, but much more needed to be done.

"In the current year, we must focus relentlessly on reducing underlying operating losses at Guardian News & Media," he said.

Miller dismissed reports that suggest the Guardian's internet-only US operation is struggling, pointing out that traffic had grown 12% to 20 million monthly unique users and that, in the first quarter of GNM's new financial year, the operation was ahead of budget.

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Source: Guardian (UK)

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