The publisher of the Daily Telegraph and Sunday Telegraph has reported a 50% fall in annual profits.
Pre-tax profits for Telegraph Media Group fell from £27.1m in 2016 to £13.7m last year, with a drop in circulation and advertising revenue, and an investment programme taking its toll on the publisher’s bottom line.
Total revenues fell from £303m to £285.7m as print and circulation revenue declined by 9% year on year. The company also pointed to a £10m investment programme instituted by the new chief executive, Nick Hugh, as the Telegraph looks to “re-emphasise” quality journalism.
Last September, Hugh unveiled a new “registrations-first” plan, with a goal of attracting 10 million registered customers. About 2.5 million have been signed up so far and the publisher says it is on track to beat its target of 3 million by the end of the year. The majority register for free access to a number of articles each month and some pay for access to additional premium content.
Hugh’s strategy also included creating 39 new journalist roles and 100 across the wider business.
“Since September, we have begun the first phase of long-term investment in quality journalism,” Hugh said. “2018 is a turning point for our business. Our digital revenues will continue to get stronger and stronger, and as we continue to invest in and focus on quality journalism, we anticipate this momentum continuing.”
The company said digital subscription revenue rose 30% year on year in 2017, while travel commerce revenue rose 59%.
“We anticipate revenue to stabilise in 2018-19 with profit to follow,” the company said. “We will continue towards our goal of 10 million registered customers and sustainable growth.”
Last year, the Telegraph’s long-serving chief executive Murdoch MacLennan stepped down after 13 years of running the papers. He was replaced by Hugh, who had joined from Yahoo as chief operating officer only six months before.
There have been persistent rumours that the Telegraph could be sold, with the Amazon founder and Washington Post owner, Jeff Bezos, the latest potential suitor to be mentioned in City circles.
The Telegraph’s owners, David and Frederick Barclay, have maintained there are no plans to sell the business.
