Daily Mail and General Trust (DMGT), owner of the Daily Mail, has been battered by another advertising slump as recent lockdowns play havoc with it free sheet newspapers and events business.
Underlying group revenue declined 15% in the first quarter of its financial year as the pandemic derailed both planks underpinning its bottom line.
What’s the deal
Print advertising across the group slumped a calamitous 38% over the three months to 31 December, led by a collapse in readership for the Metro newspaper as commuters stay at home.
Grim results across the consumer media sector saw total underlying revenue fall 13%, driven south by red ink across the board including a 16% decline in underlying advertising revenues.
The scale of these losses eclipsed an 8% uptick in digital advertising, which was in no way sufficient to compensate for losses incurred elsewhere, despite a strong performance from B2B brand UK Property Information which saw revenue rise by 18%.
Seeking to put a positive spin on the numbers, executive chairman Lord Rothermere blamed the outsize underperformance of the Metro for skewing the figures as a whole.
Rothermere points to the fact that were The Metro to be excluded, DGMT’s advertising performance would have been ”in line” with the year before on a like-for-like basis.
Looking forward, DGMT’s crystal ball remains cloudy with the reverberations of the pandemic making the short-term outlook for its property, media and events businesses uncertain at best.
How are UK newspapers generally faring in the pandemic?
DMGT’s disappointing results deflate hopes that the publishing sector might be poised to mount a comeback after rival Reach – parent company of the Daily Mirror and Daily Express – predicted its operating profit would come in ahead of expectations.
Pandemic disruptions have also left their mark on Rupert Murdoch’s News Corp, which also saw revenues and advertising decline despite a flurry of new online subscribers and an improved digital performance.
The plight of newspaper publishers was the subject of a recent opinion piece by Newsworks managing director Jo Allan, who called on advertisers to play a more active role in supporting news brands at a time of transition.
Allan said: ”The advent of the pandemic has accelerated the ongoing transition of news brands into diverse revenue streams such as audio, affiliates, e-commerce and subscriptions, as well as creating agile new methods of distribution.”