Operating profit at Irish Times climbs to €8.3m after surge in paid subscribers

‘Excellent year in extremely difficult circumstances’ prompts repayment of subsidies

The Irish Times clock at the company’s office on Tara Street in Dublin. Photograph: David Sleator

The Irish Times clock at the company’s office on Tara Street in Dublin. Photograph: David Sleator

 

The group behind The Irish Times made an operating profit of €8.3 million before exceptional costs in 2020, more than double the €3.8 million figure recorded the previous year.

Consumer revenues at the group rose 10 per cent as growth in paid subscribers accelerated in the early months of the Covid-19 crisis, and helped mitigate the impact of other declines, including a 20 per cent drop in pandemic-hit advertising revenues.

Turnover fell 8.2 per cent to €101 million, accounts for The Irish Times DAC show, but costs fell by a greater sum.

The media group availed of two Government wage subsidy schemes, receiving a total of €3 million, but it has since reviewed the “strong” trading performance for the year as a whole and decided to repay this sum to the exchequer.

‘Huge bounceback’

Liam Kavanagh, the group’s managing director, said this was the right thing to do as the subsidies were designed for companies in financial distress. While the group had been in distress in the first phase of the crisis, conditions subsequently improved, with the media sector seeing a “huge bounceback” in advertising revenues later in 2020.

The group’s pre-tax operating profit would have arrived at €5.2 million had the €3 million repayment been reflected in the 2020 financial statements.

As of the end of 2020, the group had a total of 126,656 digital and home delivery subscribers, including students. This was up from 89,688 a year earlier.

“It was an excellent year in extremely difficult circumstances. We found a new level in paid subscribers, which was very heartening for us,” Mr Kavanagh said. “You can’t get a better compliment than a reader paying for your product.”

Total subscriber number had grown to 135,561 by the end of June 2021, with this tally boosted by the launch of digital-only subscriptions at the Irish Examiner in March. The Cork-based title now has 7,000 subscribers.

While sales of printed newspapers have “done well” at the weekend, Monday to Friday circulation remains “under pressure”, Mr Kavanagh added. However, they are “much more stable” now that lockdown restrictions have been lifted.

Investment plans

Advertising revenues, meanwhile, have continued to improve month by month in 2021 and the group is “reasonably optimistic” about the second half, he said.

The Irish Times is making an investment of €1.5 million in technology this year and its adoption of the Arc content management system is expected to lead to a refreshed app and website.

The accounts show operating profit after exceptional items and amortisation of goodwill on investments arrived at €7.2 million last year, up from €1.3 million. Exceptional items of almost €500,000 compared to €1.2 million in 2019 and mainly reflected restructuring costs.

The group employed an average of 797 employees across printing, publishing, broadcasting, distribution and administration in 2020, down from 818 the previous year. It finished the period with net cash of €24 million, up from €16.6 million.

As well as The Irish Times and Irish Examiner, the group owns Cork daily the Echo, six weekly regional titles, majority stakes in radio stations WLR and Beat 102-103 and a minority stake in Cork’s Red FM.

Other subsidiaries include property business MyHome.ie, training company Itronics and web publisher DigitalworX, while the group also owns a 50 per cent interest in magazine publisher Gloss Publications.