The publisher of the Daily Express and Daily Mirror has said a marketing “blackout” after the death of Queen Elizabeth II significantly hit its advertising sales, in the first sign of how the period of mourning affected UK media groups.
Reach said on Tuesday that its digital revenues fell 8.1 per cent in September, while its print advertising plummeted by almost a third during the month of the Queen’s funeral.
The publisher also announced the departure of its chief financial officer Simon Fuller after less than three years in the position. His exit comes after a difficult summer where hundreds of Reach journalists held a strike in August over pay.
Fuller, who will stay in the post until the end of this year, will be replaced by Darren Fisher, who was the group director of finance at ITV.
Reach’s trading figures are the first public benchmark for how the hiatus in advertising may have hit other media outlets in the UK, including Rupert Murdoch’s Sun, Lord Rothermere’s Mail titles and commercial broadcasters such as ITV.
While coverage of the Queen’s death drove a sharp rise in newspaper sales, Reach said the additional revenue was more than offset by big brands deferring or cancelling scheduled campaigns. As a result, group revenue fell 4.1 per cent in September and 1.9 per cent in the third quarter.
Chief executive Jim Mullen praised his newspapers for their coverage of “a truly once in a generation event”.
“Actions on costs are helping to mitigate inflationary pressures and while macro uncertainty persists, improved revenue trends during [the third quarter] are a positive,” he said.
Cost inflation, the deteriorating economy and fears over advertising spending come at the end of a difficult year for Reach, which was previously known as Trinity Mirror and has titles including the Manchester Evening News, Birmingham Mail and Liverpool Echo.
Shares in the group fell as much as 4 per cent in early trading on Tuesday, extending a precipitous decline that has wiped about three-quarters of its market value in less than a year. The shares recently clawed some of their initial losses back to trade 1.6 per cent lower on Tuesday.
Reach was trading at its highest share price level since 2007 in August, driven by hopes the company was making a successful transition to the digital era with a line-up of free-to-read brands and a strategy for consumer data collection.
Over the coming three months, Reach said it expected print circulation revenue to be supported by higher prices, while advertising sales should be lifted by the World Cup and Black Friday.
