Reach flags costs, sees revenue slide as digital headaches persist

Reach PLC on Tuesday flagged charges related to its restructuring plan, as it reported a decline in revenue which it attributed to reduced search engine referrals.

Self-described as the UK and Ireland's largest commercial news publisher, Reach owns the Mirror, Express, Daily Record and Daily Star UK national titles, as well as local publications MyLondon, BelfastLive and the Manchester Evening News.

It is in the midst of a structural overhaul, which sees the company cutting 220 editorial roles and closing three of its local titles - KentLive, AberdeenLive and GalwayBeo - PA reported last month.

In the nine months ended September 30, overall revenue dropped 11% on-year, with digital revenue down 15% and print revenue down 9.5%.

In the third quarter, group sales slid 14%.

Print sales fell 12%, with circulation and advertising revenue down 11% and 7.8% respectively, though Reach said print advertising was strong thanks to the FIFA World Cup.

Driving the slowdown was the digital department, where sales fell 20%, reflecting declines of 5.5% and 30% for direct and indirect revenue respectively, against what Reach framed as a backdrop of "ongoing industry-wide disruption in referrals, primarily from Google".

Indirect revenue is linked to search-engine referrals to Reach's websites. The company back in July had pointed to trouble in this area. For the first half, Reach reported that referral volume from Google, part of Alphabet Inc, shrank by 55% for a year before.

"We know AI firms are using our content in their products many millions of times a day," Chief Executive Piers North said in July.

"This represents a fundamental shift in how people access our content, but through our strategy we are able to take advantage of the opportunities within this shift."

In the third quarter, Reach said that on-platform audience numbers were down, but that this was offset partly by off-platform expansion, which covers AI licensing. This is "supported by a recently secured agreement with a major tech platform", which Reach did not name.

"Looking ahead, we are executing our strategic priorities to counter these headwinds and build a more sustainable business. These include reinforcing our well-known brands, monetising our high-quality video content, and diversifying our revenue streams away from traditional on-platform advertising," the publisher said.

The company said it had made progress with its restructuring agenda, and expects full-year operational cost savings to be above the 10% level reported for the first half. It estimates that total cash restructuring costs for the year will range from £35 million to £40 million.

Maintaining a "cautious outlook" for the digital division, Reach said it is on track to meet market expectations, which it cited as full-year adjusted operating profit of £95.1 million.

In 2025, Reach swung to a pretax loss of £165.9 million from a profit of £62.8 million in 2024. It also posted an attributable loss of £132.3 million, swinging from a £53.6 million profit a year earlier. Adjusted operating profit rose 2.4% to £104.7 million from £102.3 million.

The company will report annual results on March 2.

Reach shares fell 0.9% to 46.60 pence each on Tuesday around noon in London, and are down 28% over the past year.

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