TIDMNWOR
RNS Number : 2888A
National World PLC
01 June 2021
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF REGULATION 2014/596/EU (WHICH FORMS PART OF
DOMESTIC UK LAW PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL) ACT
2018 (THE "EUWA")) ("UK MAR"). UPON THE PUBLICATION OF THIS
ANNOUNCEMENT, THIS INSIDE INFORMATION (AS DEFINED IN UK MAR) IS NOW
CONSIDERED TO BE IN THE PUBLIC DOMAIN.
National World plc
Trading Update for 21 week period ended 29 May 2021
National World plc ('the Group') is pleased to announce its
first trading update for the 21 week period ended 29 May 2021 ('the
period').
Initial reorganisation completed with significant cost
reduction. The Group enters the next phase of its development and
targets doubling its online audience by the second half of 2022
Post the acquisition of JPI Media significant progress has been
made on the strategy to localise, energise, digitise and monetise
relevant and unique content to create a modern operating model for
news publishing across multiple brands and platforms. Key
highlights of the transformation initiatives include:
-- Delayering and flattening management structures delivering
annualised savings of GBP4.0 million net of National World
management costs. The Group remains on track to deliver at least
GBP5.0 million of annualised savings (net of National World
management costs) during 2021 with restructuring costs of c.GBP4.0
million.
-- Maintaining strong cash management with cash balances of
GBP18.0 million at the end of the period, ahead of
expectations.
-- Monthly content provision revenue from Google and Facebook, commenced from January 2021.
-- Year on year subscription revenue tripled to GBP0.6 million for the period.
-- Streamlining the head office function and the creation of
seven regional media units covering commercially homogeneous
markets with the redeployment of several hundred staff.
-- Technology investment to stabilise and enhance news websites.
-- Portfolio enhancements including a new national online
newsbrand, nationalworld.com, with 3.5 million page views in the
first full month of launch, which exceeded expectations.
-- Leveraging existing Group resources for further online and
print launches and relaunches resulting in circulation revenue
stabilisation.
-- Roll-out of subscription across 35 sites and trialling of a
new subscription platform for premium content payment on a daily
basis.
-- Training and development of commercial teams in digital marketing skills.
The Group has commenced investment to stabilise the digital
infrastructure, enhance its development capabilities and roll out
SEO expertise across regions. It is now well positioned to make
further investments and acquisitions to support its transformation
and growth strategy.
Trading
The acquisition of JPI Media Publishing Limited and its
subsidiaries was completed on 2 January 2021 and the estimated year
on year revenue trends for the 21 week period ended 29 May 2021 are
presented on a like for like basis assuming the business had been
acquired at the beginning of 2020.
The year on year trends are impacted by the COVID 19 pandemic
which resulted in the first national lockdown during March
2020.
Revenue for the first quarter fell by 18% year on year with an
increase of 18% for April and May compared with the same months in
2020.
Actual Estimated Estimated Estimated
Q1 April and YTD YTD
May
% % % GBPm
Print* (21) 13 (11) 28.9
Digital** (1) 60 18 4.7
Other (4) 4 (1) 0.6
------- ----------- ---------- ----------
Total revenue (18) 18 (8) 34.2
--------------- ------- ----------- ---------- ----------
*Print revenue includes all print driven revenue and all print
led packaged revenue with digital and government Covid-19
advertising spend (print and digital)
**Digital revenue includes all digital driven revenue and all
digital led packaged revenue with print
Print advertising and circulation revenue is estimated to have
fallen by 10% during the period with April and May achieving
advertising revenue growth of 34%, circulation revenue is in line
with 2020.
Digital advertising revenue is estimated to have grown by 1%
during the period, with growth of 45% across April and May. Digital
subscription revenue grew by over 200% during the period as
subscriptions were rolled out across all the daily newspaper
websites during the course of 2020. In addition, in the last month
21 weekly papers have introduced digital subscriptions. Other
digital revenue grew by 26% during the period and includes the
benefit of content provision revenues from Google and Facebook
which have generated revenue of c.GBP100k per month from February
2021.
The Group has invested in technology and strengthened its legacy
systems during the period. Digital audience has stabilised during
the course of May and returned to growth with estimated page views
of 110 million for the month. Management anticipates growth on this
stronger base as we progress through the year with incremental
growth driven by further online launches.
Financing update
The Group held cash balances of GBP18.0 million at the end of
May with GBP1.0 million outstanding loan note debt, GBP5.0 million
deferred consideration on the acquisition of JPI Media and IFRS 16
Lease liabilities of GBP2.8 million.
Outlook
Good progress continues to be made on the transformation of the
JPI Media business and the Board is confident that performance for
2021 will be in line with its expectations.
We continue to explore opportunities to deploy our considerable
balance sheet strength through earnings enhancing investments and
acquisitions.
David Montgomery, the Chairman of National World commented on
the trading update:
'The many talented staff of JPI Media have assisted in a fast
transformation of the business based on localisation with a focus
on relevant content and supporting the communities served as they
recover from lockdown.
This transition and further investment in technology and
partnerships have prepared National World for the next stage of
rapid organic growth. Our target to double our online audience by
the second half of next year is underpinned by providing quality
content consistent with our existing premium brands across both a
local and national footprint.
We continue to evaluate investment and acquisition opportunities
that would enhance our digital capabilities.'
A management presentation on the trading update will be made
available on our website, nationalworldplc.com.
For the purposes of UK MAR the person responsible for arranging
for the release of this announcement on behalf of National World is
Vijay Vaghela, Chief Operating Officer.
- Ends -
Enquiries:
National World plc c/o Montfort Communications
David Montgomery
Vijay Vaghela +44 (0)77 3970 1634
Montfort Communications - Financial PR
& IR
Nick Miles +44 (0)77 3970 1634
Olly Scott +44 (0)78 1234 5205
Forward-looking statements
This announcement may include statements that are, or may be
deemed to be, "forward-looking statements". These forward-looking
statements can be identified by the use of forward-looking
terminology, including the terms "believes", "estimates", "plans",
"projects", "anticipates", "expects", "intends", "may", "will", or
"should" or, in each case, their negative or other variations or
comparable terminology. These forward-looking statements include
matters that are not historical facts. They appear in a number of
places throughout this announcement and include statements
regarding the directors' current intentions, beliefs or
expectations concerning, among other things, the Company's results
of operations, financial condition, liquidity, prospects, growth,
strategies and the Company's markets. By their nature,
forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances. Actual results and
developments could differ materially from those expressed or
implied by the forward-looking statements. Forward-looking
statements may and often do differ materially from actual results.
Any forward-looking statements in this announcement are based on
certain factors and assumptions, including the directors' current
view with respect to future events and are subject to risks
relating to future events and other risks, uncertainties and
assumptions relating to the Company's operations, results of
operations, growth strategy and liquidity. Whilst the directors
consider these assumptions to be reasonable based upon information
currently available, they may prove to be incorrect. Save as
required by applicable law or regulation, the Company undertakes no
obligation to release publicly the results of any revisions to any
forward-looking statements in this announcement that may occur due
to any change in the directors' expectations or to reflect events
or circumstances after the date of this announcement.
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