26th Mar 2020 10:02
(Alliance News) - Daily Mirror newspaper owner Reach PLC on Thursday said it expects circulation and advertising revenue to come under pressure due to Covid-19.
Reach, which also owns the Daily Express and a range of UK regional titles, said it traded in line with expectations in the first 12 weeks of its financial year.
However, it warned: "The situation remains significantly uncertain and it is too early to assess the expected impact that the Covid-19 pandemic will have on financial 2020 and beyond."
The company ends its financial year in late-December.
Reach continued: "Currently, the principal trading areas expected to be impacted are advertising, print circulation and events. Advertising revenue deferrals may be expected given its discretionary nature, print circulation will be impacted by footfall reductions and closures of outlets and events delays or cancellation may be necessary."
The company said it will unveil plans to limit the revenue shortfall in a trading update ahead of its May 7 annual general meeting.
Reach added that the date of its AGM is "being kept under review".
It also expects no change in its 2019 dividend, on which shareholders will vote during the AGM.
"The business came into the year with a robust balance sheet position and has adequate liquidity. Through strong cash generation in 2019, the prior year net debt balance had become net cash of GBP20.4 million and new four-year revolving banking facilities of GBP65 million had been agreed," Reach said.
Shares in the company were 2.5% lower at 94.60 pence each in London on Thursday morning.
By Eric Cunha; [email protected]
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