NUJ reacts to Reach plc annual financial report 2020
The NUJ calls on the company to recognise its best assets are its staff
As Reach plc, one of the UK's largest media groups, reports "unprecedented demand" for journalism and increased online audiences, the NUJ calls on the company to recognise its best assets are its staff.
The Reach plc report out today shows it is seeking to protect its profitability by taking action described as "mitigation" including pay cuts, furlough, suspension of bonus schemes, cancelling the shareholders' final dividend and deferring payments to the pension funds.
The report also shows that the company has increased its cash in hand from the beginning of the year from £20.4m to £33.2m and the company has a £25m drawn down from its credit facility. This makes for a £58.2m cash balance available in total, and these changes could indicate the company is keeping this extra cash flow to ensure liquidity.
In line with industry trends, the company experienced a dramatic fall in advertising in April 2020 recording a 31.8 per cent fall in print advertising and 22.5 per cent decrease in digital advertising.
Chris Morley, NUJ northern and midlands senior organiser, said:
"As the country's biggest single commercial employer of journalists, we welcome the update from Reach plc that shows the company has a sound financial footing from which to anchor itself from the turbulence to the economy that the Covid-19 crisis has created.
"It is heartening that the buying public is showing 'unprecedented demand' for news and content crafted by professional journalists and that there at last appears to be some stabilisation from the undoubtedly heavy dip to the market caused by the lockdown. We also welcome the chief executive's thanks to the way employees have reacted to help steer the company through these difficult times.
"However, we note that the group has gathered a strong cash reserve of £33 million while thousands of staff have been told to make big financial and personal sacrifices through pay cuts and furloughing where significant government assistance is coming in.
"It is concerning that the board is seeking to place such importance on protecting its very high operating profit margin of 21.8 per cent when there is a national emergency and huge public subsidy to support the business.
"We will be working hard with the company to make sure that improvements in the business mean a resumption to normal pay and conditions for staff at the earliest opportunity."