Daily Mirror publisher’s profits hit by impairments

Daily Mirror publisher Reach has swung to a full year loss after being stung by hefty pension and impairment charges.

The company posted a statutory pre-tax loss of £119.9 million in 2018, which compares with a profit of £81.9 million the previous year.

Reach said its figures were dragged down by a non-cash impairment charge of £200 million against the carrying value of goodwill, publishing rights and titles and freehold properties.

“This reflects the more-challenging-than-expected trading environment for advertising revenue generated locally and the short-term uncertainty arising from the UK’s exit from the European Union,” the firm said.

Print advertising revenue fell by 0.5% and on a like-for-like basis dropped 16%.

Reach also took a £15.8 million hit relating to the recent Guaranteed Minimum Pension ruling, which requires firms to equalise pension payments for men and women.

Revenue increased by 16.2% to £723.9 million in 2018, reflecting the acquisition of the Daily Express and other associates titles. But, on a like-for-like basis, sales fell by 6.6%.

However, on an adjusted basis, operating profit increased by 16.8% to £145.6 million, ahead of market expectations.

Boss Simon Fox said: “I am pleased with the performance we have delivered in 2018 and encouraged by the stronger finish to the year.

“We have begun 2019 in a strong financial position with good momentum on the integration of Express & Star and with clear plans for digital growth.”

The group said the integration of the Express is “progressing to plan” with cost savings of £3 million delivered last year and at least £20 million more to be stripped out by 2020.

On phone-hacking, Reach increased the provision for settling historical claims by £12.5 million during the year, taking the total amount provided to £75.5 million.