The owner of the Daily Telegraph and Sunday Telegraph newspapers blamed “structural decline” in the industry as operating profits fell by more than 61%, as it plans to reach one million subscribers by 2023.
Telegraph Media Group said that revenues fell, as expected, by 2.7% last year to £278.1 million, a slower decline than the 5.8% drop in 2017. Operating profit fell to £8.1 million.
“Our results for the year to December 31 2018 demonstrate strong strategic progress in the face of structural declines across the entire industry in print advertising and print circulation revenues,” the group said in a statement.
Despite the ongoing structural challenges in the industry, we will continue our investments in journalism and subscriptionsNick Hugh, chief executive
The business is set to embark on the second phase of a three-stage plan to reach one million subscribers and 10 million people registered to its services by 2023. It has reached 400,000 subscriptions across print and online this year, with five million registrations.
The news “gives us great optimism that the plan is working”, said chief executive Nick Hugh, predicting an improvement in the 2019 financial results.
“We are also extremely pleased to have beaten our financial targets in 2018 despite the structural changes and economic uncertainty,” he added.
The newspaper will now aim to stabilise declining revenues, and grow the proportion of its sales that comes directly from readers.
But it is also trying to reduce exposure to business areas that are unlikely to turn a profit in the long term.
Last year, reader revenue grew 2% and 54% of revenues now come from readers themselves. Subscription revenue rose 10%, driven by a 27% rise in digital subscriptions.
The company hired 39 journalists more than it removed in 2018, hitting 37 net new positions so far this year, it said.
This has included an expansion of its political team based in Westminster as the country faces “huge political upheaval” amid Brexit debates, votes and decisions.
Meanwhile, a video team that was launched at the end of 2018 produced the Telegraph’s first-ever feature-length documentary about the MPs’ expenses scandal. It also started a dedicated team to follow and write about women’s sports.
Mr Hugh said: “Despite the ongoing structural challenges in the industry, we will continue our investments in journalism and subscriptions, whilst improving our overall profit margins to continue our path towards a sustainable model, centred around our world-class centre-right journalism.”