Guardian Media Group (GMG) has seen it’s profits impacted on by projects amounting to more than £100 with pretax profits for the Group almost halving, dropping to £22.9 million from £43.8 million this time last year.
Group turnover for GMG, however, increased by 18% to £751.9 million for the period and total operating profit was shown to be up to £122.4 million from £84.5 million.
The loses seen by the media group are attributed to its £80 million initiative including changing the format size of the publication to compact and investing in three new colour presses. A further £24 million has been committed to new all-colour presses for GMG’s northern local titles.
GMG’s national newspapers division continues to perform well in what Paul Myners, chairman of GMG, called a “competitive environment”. The Guardian managed to secure a 17% market share in the period, while the Observer rose to nearly 17%.
Operating losses for the national newspapers were £18.6 million, though turnover was up by 3% with the division working towards clear targets to enable it to achieve profitability in the longer term.
GMG’s regional newspapers achieved a 6% growth in operating profits to a new high of £32.6 million, GMG Radio returned its first operational profit after deducting digital costs.
Myners drew attention to the continuing investment in online developments across the Group highlighting the success of GuardianUnlimited attracting the largest audience of any UK online newspaper, with over 10 million unique users and 100 million page impressions each month.
Sir Robert Phillis, chief executive of GMG said that the Group was now stronger and more financially secure than at any time in its history. He asserted that changing the format of its publication would allow its national newspapers to leap ahead of the rest of the market.
In May, GMG announced positive end of year trading, enjoying revenue growth of 17% year on year for all its stations, signalling a move to profit for the first time (see GMG Reveals 17% Revenue Growth Across All Stations).
The radio division of GMG has shown remarkable growth, outperforming the industry as a whole, with revenues from Jazz FM and Smooth FM stations rising to £24.5 million in the financial year ended 31 March, up from £21 million the previous year.
Earlier in the year, GMG quashed rumours that it was selling its radio division stating that it would not consider selling its stations for less than £150 million, making it unlikely that a deal will be made anytime soon (see GMG Quashes Imminent Deal Rumours).
Last March, GMG was reported to have rejected a £115 million offer for its radio division from Chrysalis. GMG is thought to value its stations at between £150-£175 million, according to a report in the Times (see Chrysalis Confirms Offer For Guardian Media Group).
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