(Reuters) -Reach Plc said on Wednesday its annual operating profit would miss market expectations, as the British news publisher struggles with lower-than-expected fourth-quarter revenue due to weak digital and print advertising, knocking shares 23% lower.
The owner of newspapers such as the Daily Mirror and Daily Express said it expected challenges to persist in 2023 and that it would start cutting costs to save at least 30 million pounds ($36.44 million).
“Near-term economic conditions remain uncertain, creating unavoidable headwinds for the whole sector, with advertising weakness and prolonged cost inflation,” the company said in a statement.
Businesses staring at a possibly lengthy recession and a worsening cost-of-living crisis in Britain are cutting back on their advertising spend to save costs.
Reach said operating profit for full-year 2022 would come in below analysts’ forecast by mid-single digits percentage.
Digital revenue fell nearly 6% and print advertising revenue slumped about 20% in the three months to Dec.
25, hurt partly by lower campaign spends around Black Friday and Christmas. Circulation revenue grew by 1.8%.
($1 = 0.8233 pounds)
(Reporting by Yadarisa Shabong in Bengaluru; Editing by Subhranshu Sahu)
