FT: Guardian Media Group Hit With Record £173m Loss
Guardian Media Group will this week reveal a higher than expected full-year operating loss of £69m as the owner of The Guardian newspaper battles to bring its finances under control.
GMG’s total pre-tax loss will hit £173m as the group belatedly writes down about £80m in the value of its stake in Ascential, the publicly quoted magazine and events company, and takes a £20m restructuring charge over severance payments.
GMG has exceeded its target of cutting 250 jobs, with 70 journalists taking voluntary redundancy as the media group struggles to deal with the harsh advertising environment that is hurting print publications.Controversy over responsibility for losses at GMG led to Alan Rusbridger, its former editor-in-chief,
Controversy over responsibility for losses at GMG led to Alan Rusbridger, its former editor-in-chief, stepping down in May as incoming chair of the Scott Trust, which is GMG’s sole shareholder. Mr Rusbridger and Andrew Miller, GMG’s former chief executive, were accused of allowing costs to escalate as the Guardian expanded globally.
The Guardian’s growth, including launching digital editions in the US and Australia, was predicated on increasing digital advertising while remaining free online. Although it recorded 167m monthly unique browsers in June, it has faced intense competition for advertising from Facebook and Google.
The operating loss of £68.7m for the year to March, to be unveiled on Wednesday, exceeds its earlier estimate of £58.6m, according to figures circulated to senior executives. GMG is facing a sharper than anticipated fall in UK print advertising, along with other newspapers, including the Financial Times.