Regional publisher Newsquest has reported a pre-tax profit of £108m for 2018, up from a loss of £213m the year before, new accounts show.
The company reported turnover of £197.3m last year, up from £130.4m the year before but down from £107.8m on a like-for-like basis, according to full-year accounts for Newsquest Media Group on Companies House.
Newsquest group finance director Paul Hunter wrote in a strategic report, published along with the accounts, that the group had closed 16 free newspapers that were “no longer viable” in 2018.
He said: “The trading environment for regional newspapers, particularly free newspapers, remains very challenging as audiences and advertising move to digital solutions while the costs of production and distribution are rising.”
In March 2018 Newsquest bought family-run publisher CN Group, which published seven newspapers including daily the Carlisle News & Star, and four magazine titles.
The 2018 accounts give the first full-year picture since Newsquest bought the Isle of Wight County Press and the Mold-based NWN Media along with its portfolio of 13 newspaper titles in 2017.
It is also the first since the group took over the assets of regional subsidiaries Newsquest (Herald and Times) in Scotland and Newsquest (Midlands South).
Newsquest said it had grown its magazine revenues by 61 per cent through the launch of new titles and increasing how often they are published.
But it added that the declines in print revenues still outweigh the growth in digital, a trend which the company expects to continue in the immediate future “necessitating robust cost control and re-engineering of the business”.
Hunter also blamed disruption caused by the introduction of new European data laws, Brexit uncertainty, rising newsprint costs, and higher auto-enrolment pension contributions for adversely impacting revenues.
The company’s planned strategy is now to continue making acquisitions and launching new titles while developing digital revenues at its news websites and diversifying into digital marketing services.
Newsquest praised the BBC-funded Local Democracy Reporter scheme, which now makes up 5 per cent of its editorial staff, and called for a “substantial expansion” of that or a similar scheme.
It said: “Our view is that a substantial expansion of an LDR type scheme and inclusion of the public interest benefits of newspaper advertising when selecting medias for public sector advertising offer the best value for money solutions to society.”
Federica Bedendo, mother of the chapel at the Newsquest branch of the National Union of Journalists, said: “It’s nice to see Newsquest acknowledging the importance of public interest journalism, it’s just a shame it is not willing to fund it properly.
“The LDR scheme is a brilliant initiative and LDRs have been a great addition to our newsrooms, but we must not let companies scrounge off the licence fee payer in order to look after their profits…
“If Newsquest is so committed to journalism, then it should reconsider the wages of those at the top and start paying the hard-working journalists what they deserve for the great work they still manage to do despite their appalling working conditions.”
The accounts show that Newsquest chief executive Henry Faure Walker (pictured) took home £526,204 in 2018, plus pension payments of £17,260 on top of that.
Newsquest is the second largest publisher of local news in the UK with around 165 news titles and almost 30 unique monthly users online across its digital portfolio, according to the company’s own figures.