Daily Mirror publisher Reach said higher newsprint inflation would result in a modest hit to 2022 operating profit as it reported a rise in annual earnings last year.
The company on Tuesday reported a 9.2% rise in adjusted operating profit to £146.1m for the year to December 26. Revenue rose 2.6% to £615.8m.
Reach, which is shifting its focus to digital output, said the impact from inflation, which began to affect the business towards the end of 2021, had intensified, particularly in print production.
“This has primarily been reflected in the cost of newsprint, which having previously been impacted by rising distribution costs and supply challenges, now also reflects the significant increase in energy prices. As a result, the gross impact of inflation in 2022 is expected to be higher than in recent years,” the company said.
“While ongoing efficiencies are expected to partly mitigate this impact, we anticipate the net effect to be a modest year-on-year reduction in operating profit as we continue to invest for the future.”
