Trinity Mirror plc is issuing a trading update, for the 4 month period from 28 December 2015 to 1 May 2016, ahead of its 2016 Annual General Meeting later today.
The trading environment for print advertising continues to be volatile. We continue to focus on the delivery of our strategy, namely growing our digital audience and revenue, coupled with tight management of the cost base. At this stage, the Board anticipates performance for the year will be in line with market expectations.
Group revenue fell on a like for like* basis over the period by 8.6% with a 9.3% decline in the first quarter and an improved rate of decline of 6.4% in April.
Within this, Publishing revenue fell by 8.5%, with print declining by 10.9% (11.6% decline in the first quarter and a reduced 8.5% decline in April) and digital growing by 15.7% (14.8% growth in the first quarter and an increased rate of growth of 18.6% in April). Publishing print advertising revenues fell by 19.0% and circulation revenues fell by 4.5%. In April, print advertising revenues fell by 15.8% and circulation revenue fell by 3.7%. We continue to see strong growth in digital audience with average monthly page views**, excluding galleries, across the publishing sites growing by 22% to 755 million on a like for like basis.
The Group has continued to invest in launching and trialing new products. In the period, we launched a new national newspaper, The New Day, and number of new digital sites.
Although The New Day has received many supportive reviews and built a strong following on Facebook, the circulation for the title is below our expectations. As a result, we have decided to close the title on 6 May 2016. Whilst disappointing, the launch and subsequent closure have provided new insights into enhancing our newspapers and a number of these opportunities will be considered over time.
Among digital innovations, we launched Dublin Live and Glasgow Live in April 2016 following the success of Belfast Live last year which achieved a month audience of more than 1m unique browsers within five months. The new sites provide a rich supply of rolling local news, weather, traffic, local event listings and lifestyle, presenting an attractive targeted proposition for advertisers.
We have also launched a new mobile app, Perspecs, which presents the three sides to a news story, allowing users to switch between different news sources presenting opposing views. For example the neutral, left and right wing political perspective of the same story, or a home, away and neutral report on a football match. This new innovative app has obtained funding for further development from the Google Digital News Initiative Fund.
Excellent progress has been made on the sharing of best practice across the Group with a number of non system dependent changes having already been implemented. In addition to the relocating of all central operations previously located at Local World’s head office in the West End to the Group’s operations at Canary Wharf, we have standardised circulation sales, recruitment telesales, editorial and advertising management structures and have also centralised newsprint procurement.
We are now into the final stages of planning the systems integration with implementation commencing in the second half of the year. Digital platform integration is being prioritised given the significant opportunities to grow audience, revenue and profits in a growing digital advertising sector.
Following the Board’s decision not to sell the former Iliffe titles, we are confident that we will deliver at least £12 million of synergy savings in 2017.
Provision for dealing with and resolving claims arising from phone hacking
We continue to settle the claims in relation to phone hacking. There is no change to the provision made for dealing with these historic issues and, whilst there remains uncertainty, the Board continues to believe that the exposures in relation to these matters remain manageable and will not distract from the delivery of the Group’s strategy for growth.
The business continues to deliver strong cash flows with net debt falling by £29 million from £93 million to £64 million. The net debt is before the payment of the final dividend for 2016, which is payable on 10 June 2016 subject to approval by shareholders at the AGM today.
*Like for like assumes Local World was owned from the beginning of 2015 and compares the 18 weeks to 1 May 2016 with the 18 weeks to 3 May 2015.
**Like for like average monthly page views excluding galleries for the Publishing division across web, mobile and apps assumes Local World was owned from the beginning of 2015 and compares the period for January to April 2016 with January to April 2015.