The owner of the Manchester Evening News, the Daily Mirror, Daily Express and Daily Star newspapers is to cut 550 jobs, 12% of its workforce, because of falling income amid reduced demand for advertising in its titles.
Reach PLC, formerly known as Trinity Mirror made the announcement as it updated the markets this morning with news that its second quarter revenue declined by 27.5% impacted by reductions in circulation and advertising compared with the prior year. Slightly improved trends in June saw Group revenue fall by 23.9%
Commenting on the announcement, Jim Mullen, Chief Executive Officer, Reach plc, said:
“Structural change in the media sector has accelerated during the pandemic and this has resulted in increased adoption of our digital products. However, due to reduced advertising demand, we have not seen commensurate increases in digital revenue.
To meet these challenges and to accelerate our customer value strategy, we have completed plans to transform the business and are ready to begin the process of implementation. Regrettably, these plans involve a reduction in our workforce and we will ensure all impacted colleagues are treated with fairness and respect throughout the forthcoming consultation process.
The plans will provide a stable platform for us to accelerate our strategy, based on stronger and deeper customer relationships, increasing our appeal to advertisers. This will ensure the sustainability and profitability of the Reach business, enabling it to deliver to stakeholders over the long-term.
Award-winning journalism and content will always be at the core of our purpose. Through the transformation, Reach will realise the full potential of its business model, enabling our news brands to continue to shape the daily conversations of millions of people for years to come.”
Reach will shortly begin a 45-day consultation regarding these plans. The Company added that the changes will provide the business with a strong platform to accelerate the delivery of its customer value strategy and significantly increased customer registration targets. Reach has already surpassed its full year 2020 target in achieving over 2.5 million customer registrations. It is now increasing its 2022 target to 10 million by 2022 up from the 7 million announced in February. Through stronger and deeper personalised customer relationships the business will make its content more relevant and advertising more targeted, increasing the value of its audience.