Reach blames Brexit for £200m writedown on newspaper business
Reach, the publisher of the Manchester Evening News and Liverpool Echo, has made a £200m writedown on its newspaper business that pushed it into the red for 2018.
The company, formerly known as Trinity Mirror, posted a pretax loss of £120m last year after writing down the value of its goodwill, publishing rights, titles and buildings, against a profit of £82m in 2017. Excluding the writedown, it made a profit of £142m.
Total revenues increased by 16.2% to £723.9m following the acquisition of the Express and Star titles from Richard Desmond last year.
However, on a like-for-like basis focusing only on the Daily Mirror, Sunday Mirror and Sunday People, revenues were down 6.6%.
Chief executive Simon Fox blamed the impact of Breixt uncertainty on advertising. He said: “If there is a no deal there is a chance we could see a downturn in advertising.”
Reach has prepared for Brexit by increasing stockpiles of newsprint imported from Norway and Canada, he added.
The company said while average monthly page views for its websites grew by 6% to more than 1bn last year, digital advertising revenues had been hit by “algorithm changes made by Facebook and Google early in 2018”, which reduced the amount of Reach content being distributed via these platforms.