Didcot closure costs to reach almost £50m

Max Goldbart
Thursday, December 1, 2016

The Daily Mail & General Trust (DMGT) has announced that the proposed closure of its Harmsworth Didcot site will cost just shy of £50m.

DMGT made the announcement in its end-of-year trading statement published today (1 December). A consultation process is expected to be completed by the end of December 2016 and, if the site is closed, costs are estimated to be in the region of £47m, the statement confirmed. 

An anonymous source told PrintWeek on Tuesday that the site, which first went into production in 2007, was entering consultation with closure date set for the end of December, putting 50 jobs at risk. Its main Harmsworth printing site was relocated to a 20-acre greenfield site in Thurrock in 2011.

DMGT announced in October in a trading update that it would be initiating a restructure that could eventually see more than 400 jobs lost.

No one from DMGT was available to comment on the Didcot closure.

Last week, Trinity Mirror announced it too would be closing one of its printing sites, at Cardiff, putting 33 jobs at risk. PrintWeek understands that the publisher is being considered as a potential option to take over some of the work currently produced at Didcot. 

In its end-of-year results, DMGT’s DMG Media arm, which encompasses the Daily Mail, Mail on Sunday, MailOnline (Mail Businesses), Metro, Elite Daily and Newsprint, recorded a loss in revenue of 3%, falling from £731m in 2015 to £706m.

The Daily Mail and Mail on Sunday revenues saw a similar decrease, a drop of 3% from £499m to £484m, but its digital MailOnline arm saw revenue increase from £73m to £93m (28%), meaning Mail Businesses overall saw a 1% increase in revenue. Revenue for Metro fell by 5%, from £70m to £65m.

Total operating profit for DMG Media fell by 20%, from £96m to £77m, with Mail Businesses falling 12%, from £79m to 69m.

In a webcast, DMGT finance director Stephen Daintith, who is soon to leave the business, said that any increase in profit margin for DMG Media was largely down to its digital assets, particularly in the US, where it had invested hard in MailOnline.

He said outlook for the year ahead was stable, and that the first weeks of the new financial year had already shown encouraging signs, with underlying revenues up 5%, benefitting from cover price increases and an increase in advertising revenue.

DMGT recorded an overall increase in revenue in 2016 of 4%, from £1.85bn to £1.92bn. Adjusted operating profit before tax, however, fell 7% (£281m to £260m), and earnings per share were down 6%, from 59.7p in 2015 to 56p in 2016.

It reduced its net debt by £23m to £679m and total exceptional operating costs hit £55m.

The deficit on the group’s pension scheme increased by 55%, from £159m at the start of the year to £246m at 30 September 2016.

Newly appointed DMGT chief executive Paul Zwillenberg said its overall results reflect "the ongoing resilience of the portfolio through varying market conditions".

DMGT also encompasses a substantial B2B division that includes Euromoney, DMG Information, DMG Events, and Risk Management Solutions.

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