Reach plc report as follows:
Piers North, chief executive said: “We are on track to deliver on market expectations for the year and remain confident in our ability to navigate uncertainty. We will maintain financial discipline and strategic focus through this period, until our pension deficit payments are due to end in 2028.
“Guided by our strategic priorities, we are building a stronger business by investing in digital subscriptions and video, securing greater independence from referral traffic. Our future will be less about volume and more about original content, distinctive brands and securing better returns.”
- Revenue of £232.9m (H125: £256.0m), with Print revenue declining 8.3% to £178.0m (H125: £194.1m). Key constituents include print circulation £134.7m (H125: £144.3m) and print advertising £24.6m (H125: £27.7m), both outperforming the 22% decline in circulation volumes.
- Digital revenues of £54.2m (H125: £61.1m) continued to be impacted by lower referral volumes, mainly from Google. This meant that on-platform page views declined 40% year-on-year, and indirect revenues, which are volume sensitive, declined 16.2%. Excluding our local business, direct revenues grew by 6.0%, reflecting the success of our revenue diversification and video strategies.
- Disciplined cost actions, including the 2025 restructure along with the rationalisation of our print sites, resulted in a 10.3% reduction in adjusted operating costs, ahead of our 5-6% target.
- Adjusted operating profit decreased by £1.8m to £43.0m, with an improved adjusted operating margin of 18.5%.
- Cash remains a focus and the Group generated £48.8m of adjusted operating cash (H125: £45.8m, with cash conversion of 113% (H125: 102%) and closing net debt of £47.5m (H125: £26.0m). This represents a leverage of 0.4x.
- Statutory operating loss of £43.5m, driven by £36.1m non-cash impairment charge relating to the closure of two print sites (H125: £nil), £21.7m amortisation of publishing rights and titles (H125: £nil) and £18.9m of restructuring costs (H125: £4.2m).
- The next triennial valuation for our defined benefit schemes is in progress and is due to be completed by 31 March 2027. As at 30 June 2026 the IAS 19 pension is in a £4.9m surplus. 2026 is the penultimate year of making the £57m deficit reduction payments for our closed defined benefit schemes. In 2028 these will step down to £15m before coming to an end.
- Dividend to be rebased to create more financial flexibility with capital rebalanced to organic investment. Interim dividend 1.44p per share (H125: 2.88p). The Board recognises the importance of shareholder returns and commits to continue to review its capital allocation, particularly from 2028 onwards as our pension deficit payments reduce.
The results can be seen in full here.
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