Newspaper publisher Reach to cut 550 jobs as pandemic hits revenue
‘DAILY Mirror’ owner Reach said yesterday it plans to cut about 550 jobs, or 12pc of its workforce, after the Covid-19 pandemic hit circulation and advertising at its national and regional newspapers in Britain.
Reach, whose titles also include the ‘Daily Express’ and a stable of regional UK newspapers, said second-quarter revenue declined 27.5pc, with print revenue down 29.5pc and digital revenue down 14.8pc.
In Ireland, Reach owns the ‘Irish Mirror’, ‘Dublin Live’ and RSVP Magazine here as well as 50pc of the ‘Irish Daily Star’.
It is the latest in a stream of UK companies to announce job cuts in the wake of the pandemic, and its shares were down 11.5pc at 79 pence in early trade.
Reach CEO Jim Mullen said the pandemic had accelerated the shift from print to digital, with more than 41 million visitors to the group’s websites in May and customer registrations passing 2.5 million.
“However, due to reduced advertising demand, we’ve not seen commensurate increases in digital revenue,” he said.
Mr Mullen said Covid-19 hit the smaller businesses that advertised in its regional titles particularly hard, with twothirds of them not picking up the phone when called by sales teams in April.
Advertising and circulation had improved slightly by June, he said, but trading was still well below pre-Covid levels.
Jobs will be cut across national and regional oper
Print revenue declined 29.5pc as digital revenue fell by 14.8pc
ations, Mr Mullen said, in a plan that will deliver £35m (€38.8m) in annual savings at a one-off cost of about £20m.
Rival News UK, publisher of ‘The Sun’ and ‘The Times’ newspapers, also warned staff last month of impending job cuts, with CEO Rebekah Brooks saying some tough decisions needed to be made in the coming months.
Reach cut staff wages in April by 10pc and management pay by 20pc and suspended bonuses to save money. It also scrapped its dividend.
Before the pandemic hit, Mr Mullen was making progress in improving Reach’s bottom line through efficiencies, driving its shares to a five-year high of 187 pence in February. They have now fallen 58pc from that level.
Mr Mullen said the job cuts announced yesterday were about a more effective use of resources, not cost-cutting.
“Over the medium to long term we see a bright future for our journalism,” he said.