UK news publisher Reach says Ukraine war hitting ad demand

·1-min read

LONDON (Reuters) -British news publisher Reach said advertiser demand had slumped in the last two months as brands sought to avoid placing adverts alongside content about the war in Ukraine, hitting digital growth.

The owner of the Daily Mirror, Daily Express and a string of regional titles said it was also working to mitigate the impact of newsprint inflation due to higher costs for paper and energy.

In the four months to April 24 it said advertising revenue in print was down 10.1%.

While digital revenue rose by 9.3% year-on-year, that compared with a 25.4% increase in the full-year 2021.

"Over the past two months the market has experienced reduced advertiser demand and lower average yields, with the war in Ukraine significantly reducing the level of 'brand safe' content for news publishers," the group said.

Reach relies on growth in digital readers to offset the long-term trend of declining print sales, and it has more than 10 million registered users for its news sites who can be targeted by advertisers.

Its shares, which have fallen sharply since they reached a 14-year high last August, were trading down more than 14% in early deals on Thursday.

Reach said for the year ahead, it still expected broadly flat group revenue, although with a higher mix of circulation revenues and a lower digital contribution than expected.

Russia's invasion of Ukraine in February has had an impact on everything, from the cost of grain to energy, other commodities, and consumer confidence.

Google's YouTube said in April its ad sales had been hurt by the conflict after it stopped sales in Russia and brand advertisers, particularly in Europe, pulled back on spending.

(Reporting by Kate Holton, Editing by Paul Sandle)

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