The publisher of The Guardian newspaper, Guardian Media Group, has faced significant financial difficulties due to escalating costs and ongoing challenges resulting from declining print sales and weak advertising.
In the 12 months leading up to April 2, the company incurred a pre-tax loss of £47.5 million, a sharp contrast to the £142.7 million profit recorded in the previous year.
Tax Credit Eases Financial Burden
Although the financial situation appears bleak, the latest accounts filed at Companies House indicate that the company received a £31.8 million tax credit, which reduced the post-tax deficit to £156.7 million, compared to a surplus of £120.3 million in the preceding period.
Editor-in-chief’s Salary and Revenue Growth
Guardian Media Group disclosed that its editor-in-chief, Katharine Viner, received a base salary of £509,850, which later increased to £527,695 following a 3.5 per cent pay rise on April 1.
Despite the financial challenges, the company managed to achieve a 3.4 per cent increase in overall turnover, amounting to £264.4 million, primarily fueled by growth in digital reader revenues, which now account for 31 per cent of all revenues.
Challenging Economic Environment and Rising Costs
The publisher acknowledged the difficult economic environment, especially in the UK, where advertising and print revenue streams faced persistent structural challenges.
As a result, costs escalated significantly, with staff expenses rising from £131 million to £152.6 million, and other expenses increasing from £91.1 million to £107.1 million.
Investing in European Growth and Cyber Attack Impact
In response to the challenges, Guardian Media Group is looking to expand its presence in Europe and has hired journalists to cater to readers on the continent.
However, the company faced additional setbacks when it experienced a “highly sophisticated” cyber attack in December, causing significant disruption across the business for several months.
CEO’s Vision for the Future
Chief Executive Anna Bateson expressed the company’s commitment to investing in quality journalism and digital business capabilities despite the difficult economic climate.
She cited revenue growth and an increasing rise in digital reader revenues worldwide as positive indicators.
The company remains focused on investing and building a strong platform for long-term success.