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Guardian News & Media is re-opening its voluntary redundancy programme after its “digital-first” survival strategy‘s first year resulted in much higher company losses.
Operating loss grew 42 percent from £33.1 million to £44.2 million ($69 million) – blamed by the publisher on “investment in digital platforms and set-up costs for the five-year transformation programme” announced in August 2011.
But GNM has also reached the same kind of milestone some other publishers have reached lately – digital revenue growth (16.3 percent to £45.7 million) made up for lost print revenue…
That meant overall company revenue stayed broadly unchanged from last year at £196.2 million. The higher losses happened because it costs money to fire people and restructure a company.
So GNM has to go on shedding staff in what is now an extended restructure. It plans to cut a further £7 million from its editorial budget and this week began asking for more redundancies. A spokesperson told paidContent the £7 million forms part of a planned £25 million reduction by 2016/17; staff were told in March.
The group says its U.S. audience grew 80 percent to 20 million unique monthly browsers, amongst a total 67.8 million (up 38 percent).
The “digital-first” strategy is seeing GNM downsize its printed products, court U.S. eyeballs and publish “open” or “mutualised” journalism, whilst operator GMG sells off non-core divisions.
When GMG sells its shares of its B2B assets, Trader Media Group and Emap, The Guardian will benefit from a windfall, but will later need an effective profit model of its own to fall back on.
Disclosure: Guardian News & Media is an investor in our parent company, Giga Omni Media.