Daily Mail owner DMGT predicts coronavirus financial hit as circulation falls
Daily Mail owner DMGT has warned the coronavirus outbreak will adversely affect business as circulation fell in 2020.
The media group said coronavirus has led to limited impact on performance to date. But DMGT has started to see the effects in its events and exhibitions and consumer media businesses.
DMGT said financial performance for the full-year is likely to be lower than the existing guidance and has suspended guidance as a result.
Total advertising revenues generated by DMGT’s consumer media business are likely to be lower than expected, notably for print advertising.
Circulation revenue is also expected to fall as some readers will be unable to buy newspapers from outlets if delivery is not possible.
Similarly the publisher’s events and exhibitions business, which accounted for eight per cent of revenues in 2019, will be affected, particularly if more exhibitions are postponed or cancelled.
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However, DMGT said the adverse impact on profits is expected to be partially offset by insurance coverage.
Chief executive Paul Zwillenberg said: “Trading for the first five months of the financial year was in line with our expectations, but the impact of COVID-19 is likely to affect our business adversely.”
“I am confident, however, that the group’s diversified portfolio and strong financial position, with more than £700m of cash and bank facilities available, will enable us to withstand a sustained period of global economic uncertainty and continue to invest through the cycle.”
In the five months to 29 February, the group’s revenue was up 3 per cent, in line with expectations. Revenue in its B2B titles was up four per cent and its consumer media business was up one per cent.
Yesterday the Daily Mail owner was given the green light for a £50m takeover of the i newspaper. DMGT, which also owns Metro, agreed the deal in November last year with the i’s current owner JPI Media.
Shares are down 0.6 per cent.