Guardian records £180m loss after write-down on publisher and digital hitch

THE Guardian made a loss of more than £180m last year as digital growth went into reverse and the tough print market took a further turn for the worse.

A tumultuous year for the Left-leaning title ended in a pre-tax loss of £173m, its accounts show. After tax, the Guardian plunged £180.3m into the red, nearly 18 times its losses in the prior year.

The largest single contributor to the red ink was a write-down on its stake in Ascential, the business publisher and events company it invested in alongside the private equity giant Apax Partners.

Ascential floated on the stock exchange earlier this year, crystallising the fall in the value of the business since the Guardian bought in, in 2007.

The Guardian itself recorded an operating loss, including exceptional items, of £100.4m, up from £48.2m in 2015. The bottom line reflected a 4pc decline in total sales to £209.5m and an increase in operating costs of nearly £40m.

Within the dip in turnover, digital advertising sales fell by 3pc to £79.6m. That came despite heavy investment in editorial and advertising sales expansion in the US and Australia, and regardless of an increase in traffic of more than a third over the year.

The Guardian has pointed to the increasing dominance of Google and Facebook in the online advertising market as a serious challenge to its efforts to replace print revenues.

Print advertising was down 15pc for the year as circulation continued to fall and more money moved online. The impact on overall print revenue was mitigated by a cover price rise to deliver a total of £126.3m, down 5pc.

The Guardian’s leadership, editor Katharine Viner and chief executive David Pemsel, has sought to bring costs under control after years of rapid expansion. More than 250 staff have taken voluntary redundancy and ambitious projects, such as an large events space near its headquarters King’s Cross in in London, have been abandoned.

The publisher is also ramping up efforts to cash in on its large online audience outside the advertising market. Ms Viner and Mr Pemsel have gradually softened the Guardian’s long-held commitment to fee access to its website and in September will overhaul its “membership” scheme, signalling a shift away from live events and toward asking for payment for some articles online. The scheme currently has around 50,000 paying members.

The redundancy programme has triggered a reorganisation that includes cuts to the print Guardian, which sells around 170,000 copies per day. The Guardian’s long-running media section will be cut from two pages to one, for instance.

A spokesman said “As part of our three-year plan we’re looking at addressing costs in all parts of the business and as such we’ve decided to reduce our print media section on a Monday from two pages to one.”

The Guardian’s losses are funded by a trust, which has dwindled from £838.3m to £765m.