DMGT sees increase in regional profit, but nationals struggle

Daily Mail & General Trust (DMGT) saw profits rise in its struggling regional division Northcliffe for the first time in four years, according to its half-year results to 1 April.

However, the positive has been offset by a 26% fall in operating profits at national newspaper division Associated Newspapers.

DMGT reported a 2% drop in turnover to £973m, while pre-tax profit dropped 37% to £46m. It also cut 600 jobs in the period, taking its overall number down to just under 6,300.

Associated Newspapers, which publishes the Daily Mail and Mail on Sunday, recorded an operating profit of £34m and a 1% turnover drop to £435m.

According to DMGT, turnover was held up thanks to: cover price increases at its national titles and growth at free newspaper Metro; Mail Online, which saw a 75% year-on-year increase in turnover; and its recruitment and digital property businesses.

The diminishing influence of its printed titles increased, with Associated Newspapers increasing digital turnover by 21%, with £100m expected to be surpassed by the end of the year.

DMGT blamed falling profit at Associated Newspapers on the UK newspaper advertising market, which led to a 7% fall in underlying advertising revenues from its newspaper-related operations to £171m; print advertising was down 10%.

While its national outlook was not great, regional newspaper division Northcliffe reported a 34% increase in operating profit to £11m, although turnover did decline 10% to £107m. Advertising fell 11% year-on-year to £75m, with circulation down 5% to £29m.

A&N Media, the parent group for the entire newspaper division, incorporating both national and regional titles, reported a 3% fall in turnover to £542m and a 24% fall in operating profits to £33m – which it blamed on lower print advertising revenue coupled with increased promotional activity within the digital side of the business.

DMGT chief executive Martin Morgan said: "We have delivered a solid underlying performance in the first half reflecting the strength of our business-to-business companies and the resilience of our national consumer titles.

"As expected, disposals and certain one-off factors have led to lower reported half year results. The continued growth of our business-to-business companies and more positive momentum expected within our consumer operations in the second half of the year means that we expect to achieve growth in earnings for the full financial year, compared to the equivalent figure last year."