Annual Report 2023
Developing
our audience
Diversifying
our revenue
Focusing
on efficiency
CONTENTS
Disclaimer
This Annual Report is sent to shareholders who have elected to receive a hard copy and is available on our website www.reachplc.com for those shareholders who have elected to receive a copy
electronically. In this document, references to ‘the Group’, ‘the Company’, ‘we’ or ‘our’ are to Reach plc and its subsidiaries. A reference to a year expressed as 2023 is to the 53 weeks ended 31 December
2023 and a reference to a year expressed as 2022 is to the 52 weeks ended 25 December 2022. Where we reference ‘like-for-like’, we are comparing a 52 week period. References to ‘the year’ and ‘the
current year’ are to 2023 and references to ‘last year’ and ‘the prior year’ are to 2022. The Annual Report contains forward-looking statements. By their nature, forward-looking statements involve a number
of risks, uncertainties and future assumptions because they relate to events and/or depend on circumstances that may or may not occur in the future and could cause actual results and outcomes to
differ materially from those expressed in or implied by the forward looking statements. No assurance can be given that the forward-looking statements will be realised. Statements about the directors’
expectations, beliefs, hopes, plans, intentions and strategies are inherently subject to change and they are based on expectations and assumptions as to future events, circumstances and other factors
which are in some cases outside the Company’s control. The Annual Report has been prepared on the basis of the knowledge and information available to directors at the date of its preparation and
the Company does not undertake any obligation to update or revise the information during the financial year ahead. It is believed that the expectations set out in these forward-looking statements are
reasonable, but they may be affected by a wide range of variables which could cause actual results or trends to differ materially. The forward-looking statements should be read in the context of the
principal risk factors set out in the Strategic Report.
Strategic Report
2 Our purpose
3 Reach in numbers
4 Chairman’s statement
6 A powerful portfolio
7 Developing our audience
8 A resilient business
9 Diversifying our revenue
10 A proactive approach
11 Focusing on efficiency
12 Chief Executive’s review
16 Our business model
18 Our strategy
20 Key performance indicators
22 Financial review
30 Responsible business overview
32 Creating trusted, quality content
36 Operating with integrity
40 Developing our team
46 Protecting our environment
54 Task Force on Climate-related Financial
Disclosures (TCFD)
65 Non-financial and sustainability
information statement
66 Risk report
73 2023 Viability statement
Governance
74 Chairman’s statement
76 Our Board
79 Board in action
85 Section 172 statement
88 Nomination Committee Report
94 Sustainability Committee Report
96 Audit & Risk Committee Report
104 Remuneration Report
127 Compliance with the 2018 UK Corporate
Governance Code
131 Directors’ Report
Financial Statements
136 Independent auditors’ report
145 Consolidated income statement
146 Consolidated statement of
comprehensive income
146 Consolidated statement of
changes in equity
147 Consolidated cash flow statement
148 Consolidated balance sheet
149 Notes to the consolidated financial
statements
188 Parent company balance sheet
189 Parent company statement of
changes in equity
190 Notes to the parent company
financial statements
Other Information
205 2023 SASB index
207 Shareholder information
209 Group five-year summary
DEVELOPING
OUR AUDIENCE
Page 7 Page 9
FOCUSING
ON EFFICIENCY
Page 11
How we’re equipping ourselves for success in a
challenging and competitive market by managing
our cost base carefully and organising ourselves
to better serve a digital audience.
How we’re generating income beyond advertising
with new revenue streams such as ecommerce
and affiliates, while ensuring our printed
products continue to drive revenue.
How we have responded to a major shift in online
traffic trends by strengthening our secure
audience and deepening our relationship
with new demographics.
DIVERSIFYING
OUR REVENUE
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OUR PURPOSE
Our purpose is:
Delivered by our people
Strengthened by our strategy and our business model
Supported by our responsible business framework
Measured by our KPIs,
which are linked to remuneration
P. 40
P. 16
P. 30
P. 20
P. 104
TOGETHER, WE’RE BUILDING A
SUSTAINABLE FUTURE FOR OUR BRANDS.
See more examples of our purpose in action on page 34
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REACH IN NUMBERS
Trusted brands
120+
Customers choosing a Reach
brand for local news (average monthly)
27.8M
Statutory earnings per share – basic
6.8P
2022: 16.8P
Registered customers
2
12.3M
Digital property in the UK
6
TH
LARGEST
Digital revenue
£127.4M
2022: £149.8M
Monthly print and online audience
47M
Revenue
£568.6M
2022: £601.4M
Adjusted operating profit
1
£96.5M
2022: £106.1M
Statutory operating profit
£46.1M
2022: £71.3M
Adjusted earnings per share – basic
1
21.8P
2022: 27.1P
UK online population reached
(average monthly reach 2023)
72%
Dividend per share
7.34P
2022: 7.34P
Engagement from secure
and data-driven audience
UP 5% YOY
Net (debt)/cash
£(10.1)M
2022: £25.4M
Audience size ranking for
UK and Ireland publishers
#1
1. Our financial statements disclose financial measures which are required under IFRS. We also report additional financial measures that we believe enhance the relevance and usefulness of the financial statements. These are
important for understanding underlying business performance. Statutory figures are shown for comparative purposes where they differ from adjusted figures. See notes 3 and 35 to the consolidated financial statements.
2. Registered customers are customers who have provided an email address and/or phone number in order to receive a service.
FINANCIAL
NON-FINANCIAL
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Chairman’s statement
The changing media world
We saw big changes in the media and
wider digital industry in 2023 – and significant
challenges. Most major media organisations
at home and abroad, including Reach, had
to contend with the dual pressures of low
consumer confidence and the dominance of
large tech platforms in deciding how or even
if they would make news available to people.
Against this backdrop, the Board and I believe
that the management team has responded
appropriately to these trends and made the
right plans for the future, enabling the business
to cover financial obligations and support
strategic investment.
Update on pensions and historical
legal issues
In 2023, we oversaw the business as it
navigated and made significant progress
in resolving several long-standing questions.
Following years of preparation and a very
carefully considered decision to go to trial,
we were able to draw a line under our
long-standing historical legal issues.
The judgment we received in December 2023
represents a watershed moment for us. Most
importantly it has given us clarity around time
limitation for any future claims, allowing the
business to plan with more certainty for
the future.
In October, we were able to conclude the 2019
triennial valuation for the MGN pension scheme,
and at the same time concluded its 2022
triennial valuation. Discussions are ongoing
with the Group’s other schemes regarding the
2022 triennial valuations and are expected to
be concluded satisfactorily by the 31 March
2024 due date.
These have been difficult, painful and long-
standing issues for all those involved, both
in the Company and those who have been
affected by them. Resolving them has been
hard work for many, but the greater certainty
for the business is real progress.
Strategy
We are encouraged by the business’s progress
this year in diversifying its revenue, ensuring
that our ad-based model is supported and
strengthened by multiple income streams.
Affiliates and ecommerce have both shown
promising growth, as we have built on our
early success with the OK! Beauty Box and
explored several new opportunities.
It was also good to see our three US sites
launching on schedule and building their
audiences as planned – an important step
in strengthening our customer base.
In Q4, we approved additional investment to
key areas including video, ecommerce and
affiliates, as well as further focus on the youth
and lifestyle audience.
We will also continue to invest in our
successful in-house ad-tech tool Mantis,
which we originally launched in 2019 and have
steadily expanded on. Powered by machine
learning, Mantis has proven to be a valuable
tool for a range of uses, including brand
safety, contextual advertising and driving
page views by recommending suitable
content to our audiences.
The Board and I recognise the importance of
continuing to assess and challenge strategic
progress, especially against the backdrop of
a rapidly shifting landscape.
Regulatory developments
Our CEO Jim Mullen completed his last year
as chair of the News Media Association (NMA)
Board in 2023, a year when we and the rest
of the industry saw positive movement on
several pieces of key media legislation,
DRAWING A LINE BETWEEN PAST AND FUTURE
Nick Prettejohn
Chairman
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Across the wider business, we continued
to make progress in making Reach more
responsible, such as by providing greater
support to colleagues regarding menopause
and accessibility, and we were proud to see
our efforts recognised when we were ranked
#19 in the Inclusive Companies list.
Our teams
In 2023, the Board oversaw the implementation
of a continued push to carefully manage our
costs, a decision that involved reducing the
size of most of our teams. While we agreed
this was a necessary step to safeguard the
future of our business and our journalism, we
recognise that such changes are enormously
difficult for all our people. We worked closely
with management to understand the impact
of these changes and encouraged direct
communication with employees, via several
in-person meetings across Reach sites.
Board changes
Darren Fisher joined the Board as Chief
Financial Officer in February 2023, joining us
from ITV plc where he was Group Director
of Finance. He has brought a strong set of
financial, operational and strategic skills to the
Board, experience which will benefit the Group.
For more on changes to the Board this year,
see page 75.
Dividend
The Board proposes a final dividend of 4.46
pence per share for 2023 (2022: 4.46 pence
per share), which follows the interim dividend
of 2.88 pence. In proposing the final dividend,
the Board has considered all investment
requirements and its funding commitments
to the defined benefit pension schemes.
Moving forward
Over the coming months, we expect to
see continuing shifts in audience and tech
platform behaviour but we will be ready to
adapt to those changes. The work we have
done in 2023 has put us in a strong position
to face the challenges 2024 may bring, and
to consolidate our position as a leading
digital publisher.
The Board and I would like to thank everyone
at Reach for another year of outstanding work
under very challenging circumstances. The
talent and dedication we continue to see is
a powerful reminder of the strength of our
purpose as we work together to ensure
the future of our journalism.
Nick Prettejohn
Chairman
5 March 2024
Chairman’s statement continued
I am always heartened to see the very real
impact our campaigning journalism has every
year, both nationally and locally – a reminder
that the work this business does matters.
While campaigns are often a labour of love
for months or even years, sometimes they hit
the mark quickly, as we saw with the Mirror’s
campaign last summer which successfully
halted the closure of rail station ticket offices.
For more campaigning journalism highlights
of the year, see page 34.
Responsible business
We continued to strengthen our commitment
to being a responsible business, building on
the excellent work done in 2022 when we
introduced a new formal framework. In 2023,
we made further progress in our environmental
efforts, in particular putting the reporting and
data in place that will pave our path to net
zero. A significant step was taken towards
this goal in 2023 when our three print sites
all completed work on installing 9,000sq m of
solar panels that will reduce both our carbon
footprint and our dependence on external
energy providers.
We also continued to work on being a more
inclusive business. At Board level, I am proud
to have achieved our 30% Club commitment
to a better gender and ethnicity balance on
the Board. However, I acknowledge that this
is only a starting point and that, while Reach’s
executive management team has also fulfilled
its pledge of achieving 30% women in its
makeup, it has yet to achieve its ethnicity
targets – this is an area we are committed
to improving.
including the Online Safety Bill and the repeal
of Section 40 of the Crime and Courts Act.
Crucially in 2023, we watched the Digital
Markets Bill continue to take shape. As this Bill
progresses through Parliament, we hope it will
provide rules of engagement that will bring
clarity and transparency to our dealings with
tech platforms, particularly around the value
of our content. Reach will continue to work
both with Government and opposition to
lobby for a fair playing field for news in
the digital landscape.
Innovative journalism
We remain driven by our core purpose
to enlighten, empower and entertain our
audiences. While awards aren’t the only
marker of our success, it was nonetheless
gratifying to see our teams continue to be
recognised for their work in 2023, often on
an international scale. For example, the
International News Media Awards (INMA)
recognised the Manchester Evening News for
its Awaab Ishak investigation, and the Cannes
Lion International Festival of Creativity gave
the Daily Star a Bronze PR award for its viral
sensation ‘Lettuce vs Liz Truss’ campaign.
Closer to home, our journalists continued to
win multiple awards, with our local colleagues
in particular regularly sweeping the categories.
We were also noticed for work which saw our
people exploring new territory – for example,
the multi-award-winning WhatsApp
communities project from our social team,
which pioneered a new and effective way of
engaging with people. This drive to innovate
and reinvent how we deliver our content
deserves to be celebrated.
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Reach plc Annual Report 2023
A POWERFUL
Brands across UK & US
120+
We reach
85%
of the regional
news audience
monthly
We reach
72%
of the online UK
audience
monthly
PORTFOLIO
We’re Reach plc, the largest commercial news publisher in the UK and
Ireland. We’re home to more than 120 trusted brands, from national
titles including the Mirror, Express, Daily Record and Daily Star, to local
brands like WalesOnline, BelfastLive and the Manchester Evening News.
Every month, 72% of the online UK population come to us for news,
entertainment and sport they can trust. As a proudly mainstream
publisher, we connect people everywhere with what’s going on in
their area and throughout the world.
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DEVELOPING
OUR AUDIENCE
Securing our digital distribution
While we still by some distance command
the largest audience of any news publisher in
the UK and Ireland, we contended with several
dramatic shifts in online traffic trends in 2023.
We responded to these challenges by
focusing on areas within our control, driving
our Customer Value Strategy (CVS) to
maximise the ‘secure’ audience we reach
directly and by strengthening our search
engine optimisation (SEO) capability to make
our online content more visible to searchers.
We also successfully grew our secure
audience by focusing on distribution channels
we can control. For example we began using
WhatsApp groups around key topics and
brands, reaching over 1m subscribers in
just seven months.
We now have over 9.1m sign-ups from people
to receive content to their devices via these
secure channels, including newsletters,
WhatsApp and push notifications.
Widening our appeal
2023 saw us leverage our expertise in
reaching a mass audience by expanding
our operations in the US with the launch of
three ‘.com’ sites to a massive and largely
untapped audience.
We also grew our relationship with and
data-led understanding of key demographics,
in particular the youth audience, to support
our Customer Value Strategy. Our youth-
oriented brand Curiously has attracted a
healthy following (250k TikTok followers as
of January 2024), and has also provided a
valuable testing ground for our established
brands. For example, we applied learnings
from Curiously to the Mirror TikTok channel,
which by the end of the year had secured
360k followers, up from 66k in January 2023.
We will further develop our youth and video
proposition in 2024 with our newly created
multimedia Studio team.
And we continued our work to reach previously
under-served audiences via our Belonging
Project, which holds every regional newsroom
and the Mirror accountable for producing
more inclusive content and reaching more
segments of the communities they serve –
read more on page 43.
We have the largest
Arsenal WhatsApp
channel globally, with
over 600,000 members
9.1M
Sign-ups to
secure channels
(newsletters,
WhatsApp, push
notifications)
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The habitual nature of newspaper
consumption means we continue to see
reliable but falling demand for our printed
products. We still sell hundreds of thousands
of our print products every day.
Part of our strategy is to maintain this
considerable revenue stream and profit
generator for as long as possible. This is
achieved by carefully managing the levels of
publication availability across the country and
undertaking carefully planned price increases
and promotional activity. We benefit from a
significant amount of data and expertise in
these areas which help achieve the optimal
changes. Whilst availability varies by geography
and publication, it averages for the Group at
over 85%. We periodically increase the cover
prices, and over 2023 we increased these an
average of 14% per title, ahead of 4% inflation.
These actions have more than offset the 17%
volume decline, driving an increase in overall
circulation revenues.
We also work hard to manage our cost
base to address the challenges from falling
volumes and inflation. Our print business is
run by highly experienced production teams
who excel in evolving production systems,
procurement and planning our distribution
network. These actions have helped address
the rising unit costs of production and
maintained the strong profitability of the print
business. This means we have been able to
successfully ensure that print revenues and
profitability remain resilient.
DIGITAL
PRINT
Print circulation revenue
£313M
Up 1.6% on 2022 despite 17%
reduction in print volume
Print business revenue
£439M
Down 2.2% on 2022
Print copies sold a year
250M+
Retail availability
+85%
BUSINESS
A RESILIENT
RPM
(revenue per 1,000 pages)
+11%
Total data-driven revenue
£55M
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DIVERSIFYING
While print remains important, both as a
revenue stream and as a source of trusted
news for millions of readers, our overall
direction of travel continues steadily towards
digital. Using the Customer Value Strategy
(CVS) as our guide, and now with over 12.3m
registered customers, we continue to explore
ways to drive further resilience.
Affiliates and ecommerce
Our affiliates business allows us to work with ad
partners to produce quality content directing
readers to purchase, earning us steady
non-advertising revenue. Over the past three
years, our affiliates revenues have doubled,
demonstrating the benefit of relevant content
– especially across the Black Friday period
where revenue was up 90% versus last year.
We also continue to drive our ecommerce
business, for example with our OK! Beauty Box,
an early CVS initiative which now has circa
12k subscribers.
Mantis B2B
Through 2023 we continued to refine our
AI-powered ad tech tool, Mantis, in order
to open up a further B2B revenue stream.
In past years we have successfully licensed
Mantis for its brand safety capabilities. We
have now tested and built up its first-party
data contextual targeting capabilities, an
element that will be more important in 2024
and beyond thanks to Google’s well-publicised
deprecation of third-party cookies. In 2023
we invested in this in-house tech to support
a bigger B2B licensing business in 2024.
Audience diversification
And we continue to diversify our audience
and strengthen our video capabilities to
reach more of the youth market and take
better advantage of the branded social
opportunity. For more on this, see page 7.
OUR REVENUE
+45%
Affiliates/
ecommerce/
partnerships
revenue growth
>1M
people receiving
content by
WhatsApp
12,000
OK! Beauty Box
subscribers
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A PROACTIVE
Both our business and more broadly our
sector are constantly evolving and each year
we are faced with new challenges. However,
we consistently prove ourselves adept at
weathering difficulties, delivering against
our commitments and adapting to change.
Resolving past uncertainties
In 2023 we made significant progress in
resolving two long-standing issues, both
with material benefits. Firstly we were able to
reach agreement on our outstanding pension
valuation with the MGN pension scheme,
avoiding costly regulatory intervention and
providing clarity that these financial obligations
will in the main unwind in early 2028.
After a lengthy legal process we have also
been able to achieve clarity around our
historical legal issues. December’s judgment
on time limitation has materially reduced
our expected obligations and, barring
exceptional circumstances, brought
an end to any future claims.
↓ £20M
Estimated reduction in
historical legal issue costs
↓ c.£40M
Estimated reduction in
pension obligations in 2028
43%
Data-driven revenues
11%
RPM increase
Moving forward to digital-first
In 2023 we delivered a 5.7% reduction in
operating costs (on a like-for-like basis)
and in November announced a similar 5-6%
reduction for 2024. These savings decisions,
while never easy, are made to support the
future of our business.
A guiding principle behind these changes was
the need to more firmly orientate our newsrooms
and wider organisation towards our digital
audience. This meant considering online
behaviour in all of our decisions – topics,
timing, format – and rethinking how we tell
every story in today’s digital landscape.
Initiatives include the automation of our
content management system (CMS) so
journalists can save time uploading stories,
sharing more content across brands, and
organising teams for maximum impact.
For example we have brought together
our video and audio talent into one Studio
team, to produce content for both our
editorial brands and commercial partners
and to better support the branded content
revenue opportunity.
APPROACH
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FOCUSING
5.7%
Like-for-like cost savings 2022-23
17%
Adjusted operating margin
£91.9M
Adjusted operating cash flow
Responsible cost management
We have a proven track record in meeting
challenges and managing costs responsibly,
as evidenced over the past few years.
In 2020 we undertook a transformation
programme to reshape the Group into a
more efficient organisation, and as part of this
closed two of our print plants. These decisions
are always carefully weighed, but when well
executed allow us to mitigate the structural
decline in print and ensure we have a
sustainable unit cost of production.
In 2021, we adopted a hybrid working model,
following employee feedback largely in favour
of retaining more remote working options
post-Covid. This allowed us to streamline
our property portfolio and reduce those
costs, while also providing many of our
teams with greater flexibility.
During 2022, high levels of inflation drove
an unprecedented increase in like-for-like
newsprint costs (+£40m). In response, we
identified numerous ways to optimise costs, for
example by changing print pagination and
supply as well as managing availability to
reduce the volume of unsold copies.
In 2023, we took a number of actions to
support our 5.7% (like-for-like) operating cost
reduction, across several areas. As a content
business that deals in ideas and creativity,
it is unsurprising but no less challenging that
our workforce represents around half of our
operating cost base. Therefore reducing the
headcount, as we have done across all areas
of the business, has been a necessary step
in our cost management. However we also
carefully reviewed our costs in several other
key areas in 2023, from property to energy
to distribution.
For example we undertook a review of our
primary and secondary distribution plans,
reducing costs by consolidating routes and
sharing vans across both our own and
third-party publications. Print production
accounts for 13% of our costs so we
ON EFFICIENCY
Total adjusted operating costs
2022-23
continuously review our supply chain, from raw
materials through to production planning, to
drive incremental savings.
We also reassessed our real estate portfolio
in 2023, analysing how our spaces have been
used since we introduced hybrid working, and
decided to replace two larger and underused
spaces with smaller offices. This has enabled
us to manage our costs while still providing
teams with flexibility and a place to work or
collaborate when needed.
In addition we installed solar panels at all
three of our print sites in 2023, which will
mitigate some of the increases we have seen
in energy costs – more on these on page 47.
Through these changes and alongside steady
Customer Value Strategy progress, we are
able to meet our obligations as well as
position the business for the future.
2022 2023
£475
M
£498
M
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Chief Executive’s review
2023 was far from a straightforward year, but
it was an important and necessary one for the
business. We can now look to the future having
removed several long-term uncertainties and
delivered market expectations, while also
having progressed our Customer Value
Strategy (CVS) and more firmly pointed
the business towards our digital audiences.
Much of this progress was several years
in the making, for example the preparation
that supported us in 2023’s trial around several
long-standing historical legal issues. While
confronting the past in this way is not easy, the
resulting judgment on time limitation for future
claims around historical legal issues means
that a significant number of outstanding
claims can be resolved, and this should
largely bring an end to future claims.
We also took decisive action to resolve the
outstanding pension funding valuations, which
has similarly given us a firm end in sight for an
obligation that has hindered this organisation
for several decades. Together these two
achievements give the business much-
needed financial clarity and allow us to
plan for the future with far greater certainty.
Throughout the year, we made significant
progress in becoming a data-driven, digitally-
focused business, supported by a predictable
and reliable print business.
The average revenue (RPM) we generate from
our digital page views is now up over 10% from
last year, not something I take for granted
against a challenging backdrop. While we
have seen yields decline in our open market
programmatic advertising, we have been
able to add increased value by growing
non-advertising revenue streams like
ecommerce, affiliates and partnerships,
reinforcing the benefit of our Customer Value
Strategy (CVS). Crucially this has reduced the
impact from the industry-wide decline in
referral traffic, a trend that we have long
expected – albeit not as quickly and severely
as it came – and which CVS was always
intended to mitigate.
We continued our transformation in the year,
taking action to ensure that our cost base
reflects the economic environment in which
we operate, and to enable us to become
a digital-first organisation. To achieve this,
we needed to reduce the size of some of
our teams. This is not a decision I or my
management team take lightly. However,
recent trends have only reinforced our belief
that we must be willing to make big changes
to exert more control over our own destiny
and protect our brands in the long term.
The strong yield performance and efficient
management of our cost base meant we
delivered a sustainable operating margin of
17%, broadly in line with last year and giving
us a strong foundation for 2024.
A fast-changing environment
We operate in a dynamic, competitive and
constantly evolving market and 2023 was no
exception. The period of economic volatility
that began in 2020 has continued to impact
the market, placing pressure on advertising
spend and inflating costs for both businesses
and consumers. Throughout the year, our
entire industry saw a fall in referral traffic
from tech platforms and we were not immune
from that. Facebook, one of our largest traffic
referrers, has shifted away from news content
and we have contended with numerous
Google core algorithm updates, each one
requiring us to pivot on how we deliver
content to our audiences.
These changes have impacted our organic
search traffic and therefore our growth in the
near term, with page views down 24% versus
last year, in line with the wider news publishing
market. Despite the decline in volume, our
commercial teams have expertly traded
the value of our content and ad space,
capitalising on our Customer Value
Strategy progress to drive our revenue.
Telling the stories that matter
It’s clear that audience behaviour and digital
trends can shift rapidly, but what remains
constant is our core purpose to enlighten,
empower and entertain our mainstream
audiences, wherever they might find us.
A PATH TO
PROGRESS
Jim Mullen
Chief
Executive
Officer
“We can now look to the
future having removed
several long-term
uncertainties and
delivered market
expectations.”
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Great content will always be at the heart of our
business and this year our teams produced an
abundance of it. The editorial highlights that
come to mind for me personally include the
Sunday Mail’s exclusive scoop on the SNP
scandal, the Mirror’s campaign for free school
meals which so far has seen Sadiq Khan
announce free hot meals for all primary pupils,
and the Express’s campaign calling for the
Government to invest more in radiotherapy
and increase services for cancer patients.
Meanwhile, the Manchester Evening News’
award-winning Awaab’s Law campaign has
made its way through Parliament and will
change many people’s lives for the better.
And while it’s always an honour to watch
everyday heroes at the Mirror’s Pride of Britain
Awards, in 2023 it was particularly inspiring to
see members of the Windrush generation be
recognised for their outstanding contribution
to British life since the first passengers on that
vessel arrived 75 years ago.
These highlights all wield the power and
impact they do precisely because of our wide
reach, with our scale and editorial purpose
working hand in hand. Despite the challenges
of the business environment, Reach remains
the largest publisher in the UK and Ireland, and
continues to command the sixth largest digital
audience of any UK business, reaching 36m
adults digitally every month which is 72% of the
online population. Our transformation actions
in 2023 will ensure the continuation of our core
purpose into 2024 and beyond.
Enhancing resilience and efficiency
Our print business continues to generate strong
returns, despite the falling demand across the
sector. Our experienced circulation teams
use decades of data to expertly inform our
approach to price increases and availability,
both of which are critical to underpinning
sales volumes. We maintain a track record of
effective cost management and are constantly
reviewing and making changes to our supply
chain, optimising distribution and right-sizing
our property footprint.
Across the business, we successfully
delivered a 5.7% reduction in operating
costs (on a like-for-like basis), against the
5-6% reduction we targeted at the start of
the year. As announced in November 2023, to
set ourselves up for success in 2024 we have
committed to and already started to deliver
a further 5-6% reduction in our operating cost
base. In the wider industry context, with many
organisations now making similar decisions to
those we took in late 2023, we believe our early
action demonstrates responsible foresight
and planning.
As labour represents our single largest cost,
there is no getting away from the fact that
we have had to reduce the size of our teams
to save cost and re-shape for the future.
I do not underestimate the impact of these
decisions on all of our people. With that
in mind I committed to working through
them with fairness and integrity, and to
communicating openly throughout. During
this period, I led a programme of small group
discussions and town hall meetings with
Manchester Evening News reporter delivers the Awaab’s Law petition
to Downing Street alongside Awaab’s father and campaigners
Chief Executive’s review continued
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Reach plc Annual Report 2023
13
Reach plc Annual Report 2023
leaders and colleagues, to share updates,
provide important context about the need for
change, and facilitate open dialogue. Honest
colleague communication remains something
that I’m passionate about and committed to
investing time into, all year round.
Our emphasis on efficiency goes beyond
traditional cost-cutting measures as we
must also organise our ways of working to put
ourselves in the best position to achieve our
strategic aims and accelerate our journey to
being a digital-first content organisation. As
part of this work we created the Reach Studio
team, which pools all of our video and audio
talent in one super team that will provide
multimedia content for both editorial
audiences and commercial partners,
maximising the value for both.
Progressing our strategic priorities
During volatile times it is all the more
important to pursue a strategy that gives us
greater long-term stability and control over
our business.
Over the year, our Customer Value Strategy
(CVS) continued to progress on key metrics.
Against falling referral traffic, we continued
to grow our yield or RPM (+11% from 2022), an
increasingly important metric as we focus
on controlling digital revenue.
We also see that as a result of our CVS
progress, the return on data-driven advertising
is currently 10 times more valuable than
volume-related programmatic advertising
returns. These figures demonstrate that
whatever market trends may come, we are
able to consistently adapt to optimise the
value of our content, data and audience.
Our commercial activity continues to be led
by data, while focusing on direct customer
relationships and more diversified revenues
that support higher-quality digital earnings.
These efforts are reflected in our mix, which
is now made up of 43% of digital revenues
generated by data-driven, higher value and
better performing advertising, a trend which
will continue.
Part of the strategy has been to strengthen
and expand our audience base with key
demographics and into valuable regions.
In 2023 we successfully launched three ‘.com’
websites from a new US operation, which by
the end of the year were regularly attracting
an audience of a million a day.
Additionally, we have worked to secure our
audience, which will make us less vulnerable
to changing tech platform algorithms and
better able to directly engage with our millions
of customers and drive them to our content.
There have been several initiatives on this
front, including an award-winning project to
reach people via WhatsApp Communities and
Channels, through which we reach more than
1.65m people directly as of February 2024.
One early standout in this area is our Arsenal
channel which sends multiple stories a day
directly to over 600k people, making it the
biggest Arsenal channel in the world. Through
work like this we are able to speak to our
audiences on our own terms and ensure
that our great content reaches them.
Our tech and commercial teams have played
a key role in supporting our discoverability
challenge, further developing in-house
recommender tools powered by AI that
point readers to content we know they’ll be
interested in. One of these tools alone has
reduced customer bounce rate by over 10%
and generated 2bn page views through the
year. Our in-house first-party data capabilities,
in particular our proprietary Mantis tool, will
stand us in good stead as Google continues
to phase out third-party cookies, a process we
have now seen beginning in 2024. This will be a
major shift in the landscape for publishers and
advertisers, who for years have depended on
third-party data to target their advertising.
We will be significantly ahead of the curve on
this front, with 12.3m registered customers, of
which approximately 4m are active over each
four-week period, and advanced capability
to effectively place advertising using
contextual targeting.
43%
of digital revenues now data-driven
We have further strengthened our position
by growing our revenue streams outside
traditional advertising revenue, with
important work being done with affiliates
and ecommerce. It’s great to see the
continued success of the OK! Beauty Box,
which we launched in late 2020 as one of
our first Customer Value Strategy initiatives,
and now has c.12k paying subscribers.
Our goal with this work is not to replace our
business model but to continuously evolve,
strengthen and broaden it, and to give our
audiences more choice about how they
engage with our content.
“As a result of our
Customer Value
Strategy progress, the
return on data-driven
advertising is currently
over 10 times more
valuable than
volume-related
programmatic
advertising returns.”
Chief Executive’s review continued
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Resolving long-term uncertainties
For several years now, the leadership team
and I have been working to resolve a number
of long-standing hurdles facing this business.
Over the past months I am proud to say we
have made real headway in clearing these.
Ahead of 2023 we took the decision to go to
trial to achieve greater certainty around the
future impact of long-standing historical
legal issues. The judgment we received in
December set out very clear parameters on
time limitation which enables us to draw a line
under these issues. Simply, this means we now
have a much clearer view on the estimated
cost of resolving these long-standing issues
and, crucially, these costs are expected to be
materially lower than our previous estimates.
Over the last four years we had not been
able to come to an agreement with the
MGN Pension Trustees on the 2019 triennial
valuation. I cannot overstate the importance
of having successfully concluded both the
2019 and 2022 triennial pension reviews for
the MGN pension scheme. Agreement with
our other schemes is also expected to be
completed by the 31 March 2024 due date. This
provides much needed clarity on the scale of
our funding obligations, which are scheduled
to materially step down in early 2028.
These developments will both benefit the
wider business and enable better planning
for our future. Thank you to all the teams who
have been involved in bringing these matters
to a close.
Exploring AI as a tool
At the start of 2023 the conversation around
how businesses and media organisations
use AI was only beginning to take shape. Our
editorial leaders created a cross-functional
workstream to manage this complex issue,
exploring the many opportunities while also
gaining a firmer understanding of the risks.
Their primary focus has been to test tools that
help journalists to tell their stories more quickly
and effectively. As a result of this work, the
team has identified several areas with
strong potential, such as spotting trends
and analysing large volumes of data.
We have steadily increased our use of AI
through the year, while carefully controlling its
roll-out, and by the end of 2023 over a dozen
newsrooms were set up to use an AI tool to
support their work. As we continue to test AI’s
potential, we ensure that every story is edited
and approved by a journalist, maintaining our
commitment to responsible journalism.
Fighting our case
I have also been putting our case to political
decision-makers, ensuring that those in power
and in opposition understand the issues facing
Reach and the entire media industry. The stakes
are high and I have had many encouraging
discussions this year on the crucial questions
that will decide the future of journalism in this
country, such as: how can tech platforms work
fairly with the media to support a free press
and functioning democracy?
2023 marked my last year as chair of the NMA
(News Media Association), but I will continue
to discuss these vital issues in 2024 with our
legislators, particularly as we watch the Digital
Markets Bill progress through Parliament.
Looking after our people and
our future
All of this progress is made possible by our
talented and passionate colleagues in all
departments. We have made many necessary
changes to our teams this year but I remain
committed to retaining and developing the
great people who are shaping the future of
this business.
Developing our teams is just one pillar of our
formalised responsible business framework,
now one year in (read more on this on page
40). We continue to prioritise becoming a
more inclusive organisation, and in 2023
were once again recognised by Inclusive
Companies with our highest ranking yet and
testament to the dedication of many people
here. We’re also working to protect all our
futures through our environmental efforts,
which continued to progress this year as we
implemented the systems and gathered the
data that will inform our path to net zero.
Looking ahead
2023 was a critical moment for this business,
allowing us to put several significant issues
in the past and to focus instead on looking
forward, and I am confident that we are
now well positioned to take on the future.
As always, there are challenges ahead.
The macro environment is unlikely to provide
much relief over the near term and we are
working to secure our audience and build
our data-driven digital business. This will be
achieved through small incremental gains
and by continuing to build direct relationships
with our audiences.
Our industry has a history of change and the
future will undoubtedly see yet more. That’s
why it’s essential we set ourselves up to
win by making our operations suited to
an increasingly fast-paced, competitive
and digital world.
Jim Mullen
Chief Executive Officer
5 March 2024
“We now have a much clearer view on the estimated
cost of resolving these long-standing issues and,
crucially, these costs are expected to be materially
lower than our previous estimates.”
Chief Executive’s review continued
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DELIVERING VALUE
Our business model
We are transforming how we deliver value to our stakeholders, evolving and growing a digitally-focused business while
maintaining our strong foundations in print. This transition is underpinned by the strength of our talented people and our
iconic brands, united and guided by our purpose and focused on providing the content that attracts the largest audience
of any commercial news publisher in the UK and Ireland.
Our people
The talent and commitment of our employees
are central to our success as we transform and
become more digitally-oriented. We’re building
a workplace where our people are empowered
to deliver excellence and facilitate change, while
enjoying balance in their lives.
Our audience
We have the largest audience of any commercial
news publisher in the UK and Ireland. Every month,
47m people come to us, in print and online, across
our national and local titles, for news, entertainment
and sport they can trust. We are a proudly
mainstream publisher, reaching 72% of the UK’s
online population, and now bring that approach
to our US-based sites.
Our technology
Vital to our transformation is investment in data and
technology, which helps us better understand our
customers and drive digital revenue. Our in-house
adtech tool Mantis enables us to capture consented
customer data to improve our content and provide
targeted advertising for the brands we work with.
Our infrastructure
Our newspapers are produced at our three
printing sites and, with the help of our distribution
partners, reach all corners of the UK and Ireland.
Our newsrooms, local and national, are
increasingly integrated, and strategically share
data, content and expertise. Reach operates a
range of larger office hubs as well as smaller
workplaces throughout the country, serving a
now well-established hybrid working model.
Our brands
We are home to over 120 titles in the UK and Ireland.
Our portfolio is unique, including iconic national
titles such as the Mirror, Express, Daily Star and Daily
Record, and local ones which sit at the heart of their
communities, such as the Manchester Evening
News, Liverpool Echo and MyLondon. While our
titles share key central services, they each have
a strong identity, together reaching a broad
demographic across the political spectrum.
Our news coverage is award-winning, with our
titles reflecting the diverse interests and political
leanings of our audiences. We aim to inform and
explain, as well as lending a voice to the causes
that matter to the communities we represent.
While our news coverage is often serious, some
of our titles excel in finding the funny side of the
day’s biggest stories.
We cover a range of sport, from English Premier
League to Scottish football, to Welsh Rugby,
Formula 1 and our industry-leading coverage of
the Cheltenham Festival. Meanwhile our local titles
remain the ‘go to’ sources of information for local
sports fans supporting a range of levels, whether
the Liverpool Echo for LFC or Hull Live for Hull City FC.
We are proudly mainstream, which is key to our
broad appeal and widespread audience. From
celebrities to science, TV to travel and beauty to
bingo, our brands cover a huge number of topics.
Providing content for a wide range of interests
has helped us become part of our customers’
daily lives.
Entertainment
Sport
Enabled by our assets Focused on contentDriven by
our purpose
through brilliant
journalism.
News
Read more about our purpose
on page 2.
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Delivering stakeholder valueOur transformational operating model
Long-term revenue driver
Reinvestment to fund growth
Print
Market dynamic
We sell hundreds of thousands of copies
daily. While volumes are in decline, cover
price rises alongside loyal demand
support significant print cash flows.
Demographics
The average age of a print customer is
52 and this older demographic have a
high degree of loyalty and are of high
value to advertisers.
How we generate revenue
Newspaper sales account for
approximately 71% of our print revenue.
We also generate revenue from
advertising and printing for third parties.
Digital
Market dynamic
Large tech platforms continue to shape
the market – a key driver of our data-
led approach.
Demographics
We develop our evolving audience base
by evolving our formats and building
niche ‘fan’ communities across sport
and entertainment content.
How we generate revenue
Advertising-led, sold directly by our sales
teams or programmatically via auction
platforms. Increasingly our advertising is
supported by data, resulting in higher
yields, and we have also increased our
non-advertising mix with affiliates
and ecommerce.
Our brands and products
National
Our portfolio has a strong heritage.
The Mirror and Express have been a key
part of British culture and society for over
120 years.
Local
What makes us different is our unique
combination of national and local titles,
such as the Manchester Evening News
and Newcastle Chronicle, which lie at
the heart of their communities.
Magazines
OK! and New focus on celebrity news,
pop culture, fashion and real-life reader
stories. We also produce the Sunday
supplement magazines Notebook
and S Magazine.
Foundation revenue driver
More engaging
experience
More customer
data
More targeting
capabilities
More effective
advertising
More relevant
content
Increasing
yield
Increasing
volume
Underpinned by data
Our people
By setting the business up for a sustainable future
we’re able to invest in the teams we need for long-
term growth, and in fostering an inclusive culture.
Customers
Delivering our digital strategy enables us to provide
increasingly engaging and relevant content that
maintains and builds audiences.
Communities
We’re committed to contributing positively to the
diverse communities we serve, discussing issues
and supporting causes that matter to them.
Advertisers
Building a deeper understanding of our customers
enables us to help advertisers deliver more targeted
campaigns that reach the right audiences.
Suppliers
and partners
Our supply chain includes distributors, retailers and
newsprint suppliers. We work closely with all to ensure
fair economics.
Shareholders
Working in the interest of our shareholders and other
stakeholders by removing long-term uncertainties
and providing balanced and clear communications
for investors that set out our prospects for growth.
Pension funds
Delivering our strategy and maximising business
performance demonstrate that Reach is being
managed responsibly and sustainably.
Government
and regulators
A vibrant news sector is key to a functioning
democracy. Our transition to digital is a key part
of the sector’s future, as is the right regulation.
Our business model continued
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Driving revenue growth
A STRATEGY FIT FOR THE FUTURE
Our strategy
Our strategy is to get to know our customers better, drawing on behavioural insights to create
a virtuous circle of value that delivers more relevant content, a more engaging experience and
greater loyalty. This all drives sustainable, data-led revenue for our business as we continue to
strengthen our digital position.
In summary
We’re constantly working towards making Reach
a more data-led, digitally-focused business.
The enduring appeal of our print titles supports
the investment we need to make in our digital
infrastructure and platforms, and in ensuring we
have a diverse range of talent in our teams. These
investments enable us to deliver a strategy focused
on our customers – a Customer Value Strategy,
or ‘CVS’ – which enables our brands to continue
pursuing our purpose in an increasingly online world.
Why data matters
The success of our CVS relies on us forming a new
kind of relationship with the people who come to us
for news, entertainment and sport – our ‘customers’.
As a largely ad-funded model, page views are our
digital currency. And while customers do not pay
directly for their content, they give us their time and
attention which we measure most simply via these
page views. With the CVS, a further exchange occurs
– in return for more relevant content, our customers
share data about themselves. This could be declared
or personal data such as their email address or
postcode, or it could be behavioural or contextual
data based on the type of content they consume.
The more our customers engage, the more
we learn about their preferences, enabling us to
further enhance and personalise their experience.
The more we understand the behaviour of our
customers, the more valuable their profiles
become, which enables advertisers to more
accurately target their own customers through us.
A critical mass
With data the key to unlocking customer value, an
initial objective of our strategy was to encourage
more customers to register with us. We achieved
our original 2022 target of 10m registered customers
that same year, and now have over 12m, or about a
third of our UK digital audience.
We’re now focused on forging deeper engagement,
understanding each customer better, and delivering
content that encourages them to visit us more
frequently and for longer, making us part of their
daily lives.
For more on how we’re measuring strategic
progress, see our KPIs on page 20.
Building a
culture where
people thrive
Developing
a data-led
proposition
Growing
through
audience
engagement
Delivering
the stories
that matter
l
o
y
a
l
t
y
G
r
e
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t
e
r
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r
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r
e
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n
t
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n
t
e
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t
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r
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e
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g
a
g
i
n
g
e
x
p
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r
i
e
n
c
e
STRATEGIC OBJECTIVES
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Developing
a data-led
proposition
Growing
through
audience
engagement
Delivering
the stories
that matter
Our strategy continued
Launched in
August 2023
Launched in
February 2023
Launched in
June 2023
• Continued to deliver stories that embody our purpose such as M.E.N.’s
award-winning campaigning for Awaab’s Law and the Sunday Mail’s
exclusive reporting on the SNP scandal
• Created a new, centralised Studio team which brings together all of our
video and audio talent to produce content for our editorial brands and
commercial partners
• Developed the Belonging Project which ensures the Mirror and regional
newsrooms are producing more inclusive content for the communities
they serve
• Strengthened our AI-powered contextual targeting capabilities with our
in-house ad tech Mantis. Now set up to license to other publishers in 2024 as
a B2B revenue stream – particularly relevant against backdrop of ongoing
third-party cookies deprecation
• Generated 10 times more value from our data-driven advertising versus
volume-related programmatic advertising
• Further developed our in-house recommender tools, powered by AI, that
point readers to content we know they’ll be interested in
• Successfully launched three new ‘.com’ websites from a new US operation
• Establishing and growing secure audience channels – for example via our
award-winning WhatsApp Communities and Channels work which now
allows us to contact over 1m subscribers direct to their phones
• Continued progress reaching the youth audience, with rapidly growing TikTok
follower numbers across key brands
STRATEGY IN ACTION IN 2023
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Strategic Report Governance Financial Statements Other Information
17.0
17.6
23.7
22.3
21.8
2019 2020 2021 2022 2023
HOW WE PERFORMED
Target: Year-on-year growth in digital revenue.
Why it matters to us: Growth in digital revenue
is key to demonstrating progress against our
strategy, as we become a more data-led, digital
business. Our digital revenue is predominantly
driven by advertising. The advertising revenues
have been depressed from the macroeconomic
environment and the reduction in referral traffic
from the major platforms. We are making the
business more resilient by diversifying our mix of
digital revenue and securing our digital audience,
so that the performance is more sustainable over
the long term.
Target: Improving year-on-year percentage
decline rate.
Why it matters to us: Although sales of physical
news publications are in structural decline, print still
generates over three-quarters of our total revenue.
With over 250m copies sold a year, sales from
circulation remain a resilient source of revenue,
with cover price increases helping to offset the
impact of people buying printed titles less often.
Print revenue continues to drive the strong cash
flows which supports our digital transformation.
Target: Continue to grow operating margin.
Why it matters to us: Operating margin is a
measure of our profitability, as we aim to grow
digital revenue and carefully manage print decline.
While the effects of the loss of referral traffic have
impacted revenue and profitability over the near
term, over the longer term we expect increasing
digital revenues and lower levels of required
investment in our strategy, relative to its earlier years,
to support a structurally higher operating margin.
Digital revenue growth (£m)
(15.0)%
(2022: +1.0%)
Print revenue decline (£m)
(2.2)%
(2022: (3.5)%)
Adjusted operating margin (%)
(0.6)PP
(2022: (6.1)PP)
Financial KPIs
For our strategy and our business to succeed, we need to maximise growth in digital revenue and optimise our print revenue despite
the structural decline in print. The combination of declining open market yields alongside the industry-wide decline in referral traffic
meant that digital revenue declined 15%. Print has continued to be resilient, declining 2% and driven by a strong performance in
circulation revenue. In aggregate, revenue declined 5% and operating costs declined by a similar amount, driven by our efficiency
programme and some unwinding of print inflation. This meant we delivered a stable operating margin of 17%. Operating cash flow
is broadly the same as last year, reflecting the similar levels of profitability and more efficient working capital management.
Key performance indicators
127.4
149.8
148.3
118.3
107.0
2019 2020 2021 2022 2023
438.8
448.6
465.1
479.3
591.3
2019 2020 2021 2022 2023
Target: Maintain operating cash flow to meet our
financial obligations including the pension funding,
historical legal issues, returns to investors and
reinvestment into the business.
Why it matters to us: Operating cash flow supports
our commitments to ongoing pension funding and
payments on historical legal issues, as well as
investment in our strategy and returns to shareholders.
The business is strongly cash generative – due to
the resilience of our print business and efficient
operating model, which has cost management
at its core. Adjusted operating cash flow reported
above has been aligned with the definition of
adjusted operating profit to exclude the cash flow
impact of restructuring payments and other items
classified as adjusted items in the income statement.
This has resulted in an increase in adjusted operating
cash flow. Previously reported numbers include
2019 £133.1m, 2020 £121.8m, 2021 £141.3m and
2022 £64.8m.
Adjusted operating cash flow (£m)
£91.9M
(2022: £92.1M)
91.9
92.1
173.9
154.6
161.1
2019 2020 2021 2022 2023
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Strategic Report Governance Financial Statements Other Information
Target: 10.0m end of 2022.
Why it matters to us: A registered customer is
a customer who has provided their information
in order to receive a service. This includes email
addresses and phone numbers, which enable us
to build a relationship with more of our audience,
and help advertisers share more geographically
relevant ads. Knowing our customers is an important
part of the Customer Value Strategy and therefore,
it felt appropriate to have a non-financial measure
for customer registrations when we first defined
our strategy in 2020. During the course of 2023 the
referrals from major platforms adversely impacted
our page views and so we took the decision to
turn off the customer login which has reduced
customer registrations from the peak of 13.5m in
August to 12.3m in December. We have surpassed
our original target which was set at 10m for the end
of 2022 and given the current level of registrations
is now at critical mass, we will no longer be
reporting this as a key KPI within this report.
Target: Year-on-year growth.
Why it matters to us: Digital growth can come
from increased supply of advertising and/or an
increased traded price. Increasing supply for
example by increasing the number of ad units
is becoming more challenging due to the direct
impact and trade off with audience experience. It’s
important to examine and understand traded price
which is a key driver of our digital performance.
There are a few factors which drive more revenue
per thousand pages. Firstly we either have insights
into customer and customer behaviour, which can
then be used to offer opportunities to brands to
adopt better-targeted campaigns and customer
offers. Or we drive non-advertising revenues
which are not directly related to volume such as
partnerships, affiliates and ecommerce. Both of
these factors link directly to our Customer Value
Strategy and therefore we are focused on
understanding how RPM trends over time. The final
reason that this metric could move is changes in
page views, and therefore it is important that RPM
performance is considered alongside page views.
Ideally both of these KPIs would trend upwards
over time.
Total average UK page views per month
(m)
1
(21)%
(2022: 0%)
Customer registrations
(m)
12.3
(2022: 12.5)
Revenue per 1,000 pages
(£)
£8.18
(2022: £7.36)
Non-financial KPIs
As our strategy progresses, we are considering
evolving our KPIs. One of the key KPIs we are
tracking and considering regularly is RPM – revenue
per thousand pages. RPM is a yield measure and
gives the financial return from digital pages traded.
This has now been included as a strategic KPI and
is described below. Customer registrations were
critical to the Group’s success when the Customer
Value Strategy was relatively nascent. We have
now achieved a critical mass of registrations and
therefore this will be the last year we report on it
within the Annual Report.
1. The non-financial target relates to UK page views
which are more significant to revenue, whereas
worldwide page views are disclosed throughout
the Annual Report as an indicator of the total
reach of our content.
Key performance indicators continued
964
1,217
1,210
1,234
870
2019 2020 2021 2022 2023
8.18
7.36
7.55
5.88
7.02
2019 2020 2021 2022 2023
12.3
12.5
9.1
5.0
0.8
2019 2020 2021 2022 2023
Target: Year-on-year growth in total UK page views.
Why it matters to us: Page views are a strong
measure of whether customers like our content
online. As a customer views more pages, we get
to know more about them – and can collect more
valuable data. However, in 2023 we have seen
some major online platforms, most notably
Facebook, deprioritise news. This has massively
reduced the referral traffic to our site and impacted
page views by 24% globally. We are now focused
on securing our audiences to ensure a more direct
relationship, while also increasing the amount of
content our audience consumes. We’re doing this by
using data to give customers more of the content
they like to read, driving more interactions
and engagement.
21
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Strategic Report Governance Financial Statements Other Information
BUILDING LONG-TERM RESILIENCE
Financial review
Looking back over the year, we have made
demonstrable progress to ensure the business
is more resilient and able to continue its digital
transformation. During a year of macroeconomic
uncertainty and some significant shifts across
the media sector, we delivered a resilient
financial performance and made significant
progress in resolving the long-standing
uncertainties.
We concluded the 2019 triennial valuation,
along with the 2022 valuation, for the MGN
pension scheme, and have subsequently
reached agreement in principle with our other
schemes and are expected to be concluded
satisfactorily by the 31 March 2024 due date.
This provides a clear view of our future pension
commitments which will materially step down
from the current rate of £60.0m in 2028.
In December, the High Court’s judgment on
the Group’s historical legal issues (HLI) provided
clarity around time limitation. This has resulted
in a material reduction in the cost of settling
outstanding claims and should largely bring an
end to future claims. This has led to a £20.2m
year-on-year release in the HLI provision. We
expect the majority, if not all, of the issued
claims to be resolved during 2024 and 2025
which is a much shorter time frame than
previously anticipated. Resolving these two
matters has reduced uncertainty and allows
us to plan more effectively for the long term.
The macroeconomic environment in 2023
impacted advertising spend, and there was
a material step down in digital referral traffic
from major platforms such as Facebook,
which has deprioritised news content. This has
driven a 24% year-on-year decline in digital
page views, which alongside depressed open
market yields (year on year decline 25%),
adversely impacted digital revenue, which
declined by £22.4m or 15% to £127.4m in 2023.
Conversely, our data-driven revenues
performed robustly, only declining 4% year-on
year, to now represent 43% of digital revenues
(2022: 38%). To compensate for the industry
headwinds we took clear actions to continue
to diversify our digital revenues and trade
our digital assets harder. We prioritised areas
within our Customer Value Strategy which
are higher yielding and within our control.
As a result revenue per thousand pages
(RPM) across our digital estate increased
by 11%. These actions have resulted in
improved resilience, with areas of strong
growth including curated marketplaces,
ecommerce and affiliates.
Darren Fisher
Chief Financial Officer
Revenue
568.6M
5.4% decrease on 2022
43%
of digital revenues
now data driven
5% increase on 2022
Adjusted operating margin
17.0%
0.6pp decrease on 2022
22
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Financial review continued
We continued to invest in our digital expansion. We launched our three US-based sites, invested
in Curiously, our social-first, video-focused brand, and invested in new products to develop our
curated marketplace capability.
The print business remained robust and delivered £438.8m (2022: £448.6m) of revenue,
representing just over 75% of the Group’s revenue with a strong performance in circulation and
print advertising. The teams have access to a significant amount of data which has built up over
many years and this is used to determine optimal levels of availability and cover price increases.
These dynamics have offset the volume decline with circulation revenue growing 1.6%. Print
advertising declined by £10.3m, or 11.9% year-on-year; this was a solid performance,
outperforming volume trends which were down 17% year-on-year.
Focus on efficiency
Through our cost action plan we continue to focus on efficiency, setting up our operations
to adapt and thrive in a fast-paced and competitive digital landscape. At the start of the year
we committed to reducing total operating costs by 5-6%, and on a 52 week like-for-like basis we
achieved a 5.7% reduction. Inflation moderated through the year following the material increase in
the cost of newsprint in 2022, some of which unwound in 2023. Overall newsprint costs reduced by
21%, mainly driven by the decline in production volumes. We have implemented restructuring and
efficiency programmes and as part of these, headcount has reduced by 14% over the year. Our
largest operating cost, labour, reduced by 5% year-on year. Together these actions have driven
higher levels of efficiency, protecting the strong operating margin of 17% and mean we are better
positioned for the long term.
Strong balance sheet
The Group has a robust balance sheet with a closing cash balance of £19.9m, and net debt of
£10.1m (inclusive of £0.9m restricted cash). The Group has £30.0m drawn down on its revolving
credit facility. The Group’s revolving credit facility of £120.0m is in place until November 2026.
Cash management remains a priority. Group cash conversion was strong at 95% supported
by efficient working capital management. Pension scheme contributions during the year were
£60.0m, HLI claim settlements totalled £4.6m and we incurred £18.8m of restructuring payments.
Together these non-operating cash outflows amount to £83.4m.
In December 2023 the Group completed a £605.4m capital reduction, converting the entirety
of the share premium account into distributable reserves, which will support the payment of
dividends into the future. This did not involve any return of capital or payment to shareholders.
Looking ahead
The strength of our print business underpins the cash generation and profitability of the Group.
We will continue to carefully balance cover price increases and availability to deliver a robust
circulation performance despite the falling demand for print. Print revenue funds the Group’s
financial commitments and enables investment as we continue to build our digital business.
This year we will continue to invest in product and new markets including the US and developing
the AI-powered Mantis ad tech. We will also increase our use of AI tools to support increased
productivity in the newsrooms, under the continued guidance of our journalists.
Across our digital business we continue to build a more sustainable higher-quality digital mix, with
43% of digital revenue now data-driven. The depressed open market yields, compounded by the
decline in page views, have reinforced the benefits of our data-driven Customer Value Strategy.
This strategy will continue to increase yields and grow data-driven revenues.
As communicated in 2023, we have already actioned a further programme of cost reduction
for 2024, which we are confident will support a 5-6% in-year reduction in our operating costs and
protect our operating margin. Savings have been generated throughout the business and include
further steps in creating a digitally-led editorial business, for example the creation of a single
video studio.
Summary income statement
Adjusted 2023
£m
Adjusted 2022
£m
YOY change
%
Statutory 2023
£m
Statutory 2022
£m
YOY change
%
Revenue 568.6 601.4 (5.4) 568.6 601.4 (5.4)
Costs (475.0) (498.1) 4.6 (523.9) (531.5) 1.4
Associates 2.9 2.8 3.6 1.4 1.4 0.0
Operating profit 96.5 106.1 (9.0) 46.1 71.3 (35.3)
Finance costs (3.5) (2.8) (25.0) (9.4) (5.1) (84.3)
Profit before tax 93.0 103.3 (10.0) 36.7 66.2 (44.6)
Tax charge (24.6) (18.8) (30.9) (15.2) (13.9) (9.4)
Profit after tax 68.4 84.5 (19.1) 21.5 52.3 (58.9)
Earnings per share
– basic (p) 21.8 27.1 (19.6) 6.8 16.8 (59.5)
23
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Financial review continued
The results have been prepared for the 53 weeks ending 31 December 2023. The comparative
period has been prepared for the 52 week period ending 25 December 2022. The additional week
contributed £6.2m of revenue and £0.8m of operating profit. The impact of revenue and costs is
shown on a like-for-like basis in the table on page 26.
Group revenue fell by £32.8m or 5.4% to £568.6m with print down 2.2% and digital down 15.0%.
Adjusted costs decreased by £23.1m or 4.6% to £475.0m, partially offsetting the decline in revenue.
This was driven by the reduction in circulation volumes and a small unwinding of some of last year’s
newsprint cost inflation, alongside the ongoing cost reduction programme. Statutory costs were
lower by £7.6m or 1.4%, with the increase in operating adjusted items of £15.5m (£48.9m in 2023
versus £33.4m in 2022) partially offsetting the reduction in operating costs.
Adjusted operating profit decreased by £9.6m or 9.0% to £96.5m, driven by the decline in revenue
partially offset by the savings in costs. The adjusted operating margin of 17.0% in 2023 compares
to 17.6% for 2022. Statutory operating profit decreased by £25.2m or 35.3% primarily due to the
increase in operating adjusted items which include restructuring charges in respect of cost
reduction measures and impairment of the finance lease receivable and recognition of onerous
costs following the sub-lessee of a vacant print site entering administration, partially offset with
the release of the provision for historical legal issues.
Adjusted earnings per share decreased by 5.3p or 19.6% to 21.8p. Statutory earnings per share
decreased by 10.0p to 6.8p, principally due to the decrease in operating profit.
Revenue
2023
£m
2022
£m
YOY change
%
Print 438.8 448.6 (2.2)
Circulation 312.5 307.7 1.6
Advertising 76.6 86.9 (11.9)
Printing 20.2 23.1 (12.7)
Other 29.5 30.9 (4.5)
Digital 127.4 149.8 (15.0)
Other 2.4 3.0 (16.9)
Total revenue 568.6 601.4 (5.4)
Revenue declined overall by £32.8m or 5.4%.
Print revenue decreased by £9.8m or 2.2% (2022: down 3.5%). Circulation performance was strong
with revenue up 1.6% (2022: down 1.7%) driven by carefully considered cover price increases, which
were above recent historical levels, offsetting the ongoing decline in circulation volumes.
Print advertising revenue declined by £10.3m or 11.9% (2022: down 15.9%); but outperformed the
print volume decline of 17%. During the year the strongest performing sectors for print advertising
include food retail, travel, the government and entertainment and media, which is very similar to
the prior year.
Print revenue also includes external or third-party printing revenues and other print-related
revenues which decreased by £4.3m, or 8.0% (2022: increased 10.4%). These revenues are
largely contracted on a cost-plus basis, and reflect the external market demand for print.
Digital revenue decreased by 15.0% to £127.4m (2022: 1.0% increase). Revenue has been impacted
by lower advertising demand during a period of macroeconomic uncertainty alongside a
material reduction in page views. Major platforms including Facebook have deprioritised news
content over the year which in turn has driven a reduction in referral traffic for publishers across
the sector. These changes have adversely impacted our revenues which were directly impacted
by page view volume. Strategically driven or ‘data-led revenues’, which are more resilient and
higher yielding, performed robustly. Data-driven revenues were £55.3m, down 4.0%, and now
represent 43% of digital (2022: 38%).
24
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Financial review continued
Costs
2023 Adjusted
£m
2022 Adjusted
£m
YOY change
%
2023 Statutory
£m
2022 Statutory
£m
YOY change
%
Labour (223.0) (234.7) 5.0 (223.0) (234.7) 5.0
Newsprint (59.5) (75.4) 21.1 (59.5) (75.4) 21.1
Depreciation and
amortisation (21.6) (20.2) (7.0) (21.6) (20.2) (7.0)
Other (170.9) (167.8) (1.9) (219.8) (201.2) (9.2)
Total costs (475.0) (498.1) 4.6 (523.9) (531.5) 1.4
Adjusted costs of £475.0m (2022: £498.1m) decreased by £23.1m or 4.6%. On a 52 week like-for-like
basis adjusted costs declined by 5.7%. Labour costs decreased 5% as we implemented our
restructuring and efficiency programme with headcount falling by 14% over the year. Newsprint
costs reduced from lower volumes, and an unwinding of some of last year’s newsprint cost inflation.
Statutory costs were lower by £7.6m or 1.4%, a less significant reduction due to higher operating
adjusted items which were £15.5m higher (£48.9m in 2023 compared to £33.4m in 2022).
Operating adjusted items included in statutory costs above related to the following:
Statutory 2023
£m
Statutory 2022
£m
Provision for historical legal issues 20.2 (11.0)
Restructuring charges in respect of cost reduction measures (26.9) (15.5)
(Impairment of sublease)/sublet of closed print plant (19.4) 16.6
Other property-related costs (8.0) (4.6)
Pension administrative expenses and past service costs (5.5) (14.8)
Other items (9.3) (4.1)
Operating adjusted items in statutory costs (48.9) (33.4)
The Group has recorded a £20.2m decrease (2022: £11.0m increase) in the provision for historical
legal issues relating to the cost associated with dealing with and resolving civil claims in relation to
historical phone hacking and unlawful information gathering. This material reduction is driven by
the judgment handed down during December 2023 in respect of test claims. As a result of the
ruling, all claims issued after 31 October 2020 are now likely to be dismissed other than where
individuals can demonstrate specific exceptional circumstances, and therefore this has
significantly reduced the amounts that are expected to be paid out.
Restructuring charges of £26.9m (2022: £15.5m) principally relate to cost management actions
taken in the period.
Following the sublet of the vacant print site during 2022 which resulted in the reversal of an
impairment in right-of-use assets of £11.0m and previously onerous costs of the vacant site of
£5.6m, the sub-lessee entered into administration during 2023. As a result, the corresponding
£10.8m finance lease receivable has been impaired along with the subsequent recognition of
onerous costs of £8.6m of the vacant site during the period.
Other property-related costs comprise the impairment of vacant freehold property costs (£4.3m),
vacant freehold property-related costs (£1.4m) and onerous lease and related costs (£2.6m) less
the profit on sale of assets (£0.3m). In 2022, other property-related costs related to the impairment
of vacant freehold property (£4.2m) and plant and equipment (£0.8m) less the profit on sale of
impaired assets (£0.4m).
Pension costs of £5.5m (2022: £14.8m) comprise pension administrative expenses (2022: £4.2m). 2022
also included £10.6m of past service costs relating to a Barber Window equalisation adjustment.
Other adjusted items comprise the Group’s legal fees in respect of historical legal issues (£5.3m),
adviser costs in relation to the triennial funding valuations (£2.5m), internal pension administrative
expenses (£0.6m), corporate simplification costs (£0.5m), and other restructuring-related project
costs (£0.7m) less a reduction in National Insurance costs relating to share awards (£0.3m). In
2022, other adjusted items comprise the Group’s legal fees in respect of historical legal issues
(£5.2m), adviser costs in relation to the triennial funding valuations (£1.6m), less a reduction in
National Insurance costs relating to share awards (£2.7m).
25
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Financial review continued
The Group excludes adjusted operating items and the pension finance charge from the adjusted
results. Adjusted items relate to costs or income that derive from events or transactions that fall
within the normal activities of the Group, but are excluded from the Group’s adjusted profit
measures, individually or, if of a similar type in aggregate, due to their size and/or nature in
order to better reflect management’s view of the performance of the Group.
Items are adjusted on the basis that they distort the underlying performance of the business
where they relate to material items that can recur (including impairment, restructuring and tax
rate changes) or relate to historical liabilities (including historical legal and contractual issues,
defined benefit pension schemes which are all closed to future accrual).
Other items may be included in adjusted items if they are not expected to recur in future years,
such as property rationalisation and items such as transaction and restructuring costs incurred
on acquisitions or the profit or loss on the sale of subsidiaries, associates or freehold buildings.
Management excludes these from the results that it uses to manage the business and on which
bonuses are based to reflect the underlying performance of the business and believes that the
adjusted results, presented alongside the statutory results, provide users with additional useful
information. Further details on the items excluded from the adjusted results are set out in note 35.
Like-for-like comparison
53 week
FY 2023
YOY
%
LFL 52 week
FY 2023
YOY
%
Digital (15.0) (15.2)
Print (2.2) (3.5)
Circulation 1.6 0.0
Advertising (11.9) (13.0)
Group revenue (5.4) (6.5)
Adjusted operating costs YoY decline % (4.6) (5.7)
Adjusted operating profit bridge
£6m
£(13)m
£30m
£1m
£(33)m
£106m
£97m
£(10)m
FY22 Revenue
mix
Inflation
& volume
Investment Efficiencies Other FY23
Net cost saving of £23m
Adjusted operating profit of £96.5m was down £9.6m or 9.0% reflecting the decline in revenue
of £32.8m or 5.4%, mitigated by a £23.1m or 4.6% decrease in operating costs. This meant that
adjusted operating margin decreased by 0.6 percentage points from 17.6% in 2022 to 17.0% in 2023.
The net cost saving of £23m was driven mainly from efficiencies (£30m). Half of these efficiencies
related to labour costs which were lower following the cost reduction programmes with the
balance coming from the rationalisation of our property portfolio and other operational costs.
Investments were made into our US operations and youth brand, Curiously, alongside some
digital product development.
Reconciliation of statutory to adjusted results
Statutory results
£m
Operating adjusted
items
£m
Pension finance
charge
£m
Adjusted results
£m
Revenue 568.6 - - 568.6
Operating profit 46.1 50.4 - 96.5
Profit before tax 36.7 50.4 5.9 93.0
Profit after tax 21.5 42.4 4.5 68.4
Basic earnings per
share (p) 6.8 13.6 1.4 21.8
26
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Financial review continued
The results have been prepared for the 53 weeks ending 31 December 2023 and the comparative
period has been prepared for the 52 week period ending 25 December 2022. The revenue and
costs have been adjusted to show the numbers on a like-for-like basis. The additional week added
£6.2m to revenue and £0.8m to operating profit.
Balance sheet and cash flows
Historical legal issues provision
The historical legal issues provision relates to the cost associated with dealing with and resolving
civil claims in relation to historical phone hacking and unlawful information gathering. Payments of
£4.6m have been made during the year and the provision has decreased by £20.2m, driven by the
judgment handed down on the test claims during December 2023. At the year end a provision of
£18.2m remains outstanding and this represents the current best estimate of the amount required
to resolve this historical matter. Further details relating to the nature of the liability, the calculation
basis and the expected timing of payments are set out in note 27.
Decrease in accounting pension deficit
The IAS 19 pension deficit (net of deferred tax) in respect of the Group’s defined benefit pension
schemes decreased by £36.8m from £113.9m to £77.1m at the year end. The decrease in the deficit
is due to the net aggregate of many factors, mostly notable changes in market conditions leading
to an increase in discount rate, returns on the schemes’ assets, Group contributions and the
easing of inflation. We concluded the 2019 triennial valuation, along with the 2022 valuation, for the
MGN pension scheme, and have subsequently reached agreement with our other schemes which
are expected to be completed by the 31 March 2024 due date. The Group now benefits from an
agreed position on future pension funding commitments.
During 2022, similar to the West Ferry scheme, the Trustees of the Express Newspapers Senior
Managers Pension Fund purchased a bulk annuity (at no cost to the Group) and the scheme
now has all pension liabilities covered by annuity policies. Group contributions in respect of the
remaining four defined benefit schemes in 2023 were £60.0m (2022: £55.1m). Contributions in
2024 are expected to be £60.9m under the current schedule of contributions for the four schemes.
Deferred consideration
Deferred consideration is attributable to the acquisition of Express & Star. The third and final
payment of £7.0m was made on 28 February 2023. There is no remaining liability in relation to
deferred consideration.
Profit to cash measure
This ratio is a measure of our effectiveness at working capital management. It is calculated as our
adjusted operating cash flow as a proportion of adjusted operating profit.
In order to calculate this measure, adjusted operating cash flow has been aligned to the definition
of adjusted operating profit. The change is largely driven by the exclusion of the cash flow impact
of restructuring payments and other items classified as adjusted items in the income statement.
This has resulted in an increase in adjusted operating cash flow in 2022 from £64.8m to £92.1m.
2023
£m
2022
£m
Adjusted operating profit 96.5 106.1
Depreciation and amortisation 21.6 20.2
Adjusted EBITDA 118.1 126.3
Working capital movements (3.9) (12.3)
Lease payments (5.3) (6.7)
Capital expenditure (15.4) (13.3)
Other 1.3 0.9
Associates (2.9) (2.8)
Adjusted operating cash flow 91.9 92.1
Profit to cash ratio 95% 87%
During the year, adjusted operating profit was £96.5m (2022: £106.1m) and the adjusted operating
cash inflow was £91.9m (2022: £92.1m) with a profit to cash ratio of 95% reflecting ongoing cash
management. Working capital improved year-on-year, predominantly from excess newsprint
inventories which built up during the escalation of the war in Ukraine in 2022 partially unwinding
during 2023.
27
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Cash balances
Net debt at the year end is £10.1m (inclusive of £0.9m restricted cash), from a net cash position of
£25.4m at the end of 2022. The Group has £30.0m drawn down on its revolving credit facility, with
the overall total cash position of £19.9m at the year end. The Group has a revolving credit facility
of £120.0m, which expires during November 2026.
Cash generated from operations on a statutory basis was £76.4m (2022: £80.1m). The Group
presents an adjusted cash flow which reconciles the adjusted operating profit to the net change
in cash and cash equivalents, which is set out in note 36. A reconciliation between the statutory
and the adjusted cash flow is set out in note 37. The adjusted operating cash flow was £91.9m
(2022: £92.1m).
Dividends
The Board proposes a final dividend of 4.46 pence per share for 2023 (2022: 4.46 pence). The final
dividend, which is subject to approval by shareholders at the Annual General Meeting on 2 May
2024, will be paid on 31 May 2024 to shareholders on the register at 10 May 2024.
An interim dividend for 2023 of 2.88 pence per share was paid on 22 September 2023 (2022: 2.88
pence per share).
In proposing a final dividend of 4.46 pence per share for 2023 (2022: 4.46 pence per share), the
Board has considered all investment requirements and its funding commitments to the defined
benefit pension schemes.
Financial review continued
Uses for cash
The table below shows how the Group is using the cash generated from operations to meet its
financial obligations. Adjusted cash generated from operations is adjusted operating cash flow
excluding the impact of net lease payments and capital expenditure.
2023
£m
2022
£m
Adjusted cash generated from operations 112.6 112.1
Pension payments (60.0) (55.1)
Historical legal issues (4.6) (9.0)
Restructuring (18.8) (13.8)
Capital expenditure (15.4) (13.3)
Final payment on acquisition (7.0) (17.1)
Other (19.2) (21.2)
Cash flow before returns to shareholders (12.4) (17.4)
Dividends paid (23.1) (22.9)
Cash flow after returns to shareholders (35.5) (40.3)
Net (debt)/cash (10.1) 25.4
Material uses for cash include pension contributions totalling £60.0m (2022: £55.1m) and restructuring
payments of £18.8m (2022: £13.8m) which mainly relate to cost reduction programmes implemented
at the start of the year. The final payment on acquisition of £7.0m (2022: £17.1m) relates to the
Express & Star. Other comprises professional fees in respect of historical legal issues and triennial
funding valuations of £7.8m (2022: £6.8m), net lease payments of £5.3m (2022: £6.7m), interest
paid on borrowings of £3.1m (2022: £1.9m) and other movements which account for the balance
of cash flows.
The Group paid a dividend in the period of £23.1m (2022: £22.9m).
28
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Strategic Report Governance Financial Statements Other Information
Current trading and outlook
We remain focused on delivering our Customer Value Strategy and the areas within our control,
building a more resilient growing digital business and delivering efficiencies. The sector-wide
decline in referral traffic will impact Q1 2024. We expect growing momentum across our digital
business thereafter. As previously announced we have made our operations better suited for
a digital world and are on track to deliver a 5-6% reduction in full-year operating costs in 2024.
Our financial priorities remain profitability and cash. Next year we expect working capital
requirements excluding provisions to be broadly neutral, and a small step down in our capital
expenditure. We have started the process to sell a number of our freehold properties which
will support cash generation. Our financial commitments for the year ahead are similar to 2023,
including the pensions contributions which will be broadly unchanged; we expect an acceleration
in the resolution of existing HLI claims and a further £13m restructuring outflow relating to
severance payments for the recent change programme.
Trading performance across the first two months of 2024 has been robust, with print advertising
and digital performing well. We are on track with our full year outlook, but continue to operate in
an uncertain macroeconomic environment.
Darren Fisher
Chief Financial Officer
5 March 2024
Financial review continued
29
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
We aim to act with integrity at all times – not just
because we have a responsibility to stakeholders,
whose lives we affect through our operations and
journalism, but because it’s simply the right thing to do.
In 2023, we built on the progress we made in 2022,
when we introduced a new formal framework to guide
our approach to responsibility and sustainability,
by identifying disclosure gaps and enhancing our
reporting. In particular we focused on progressing our
environmental reporting in 2023, as we implemented
the systems and gathered the data that will guide us
on our path to net zero.
A RESPONSIBLE,
SUSTAINABLE BUSINESS
Responsible business overview
O
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• sustainability
governance
and management;
• privacy and security;
• political considerations;
• the supply chain (shared);
• human rights;
• labour rights; and
• health and safety.
See page 36.
• maintaining independent
journalism, campaigning
and the role of a free
press in society;
• product stewardship;
• fair and ethical conduct;
• innovation; and
• making a wider
economic contribution.
See page 32.
• GHG emissions;
• energy and climate change;
• waste;
• biodiversity;
• other emissions, effluents
and pollution;
• water;
• the supply chain; and
• speaking up for
environmental issues in
our editorial content.
See page 46.
• supporting diversity
and inclusion;
• attracting, developing
and retaining talent; and
• supporting a positive
culture and wellbeing.
See page 40.
D
E
V
E
L
O
P
I
N
G
O
U
R
T
E
A
M
Our responsibilities…
In 2023 we installed 9,000m
2
of solar panels at our
owned print sites in Oldham, Watford and Glasgow
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OUR STAKEHOLDERS
Our business and brands touch the lives of:
Our people…
who work from home and in our offices, in communities
and at print facilities – around the UK, Ireland and US;
Our customers…
who give us their data and expect us to look after it, and
who also expect to see themselves represented in our
business, brands and journalism;
Our communities…
whose voices we amplify and whose stories we share in
good times and bad;
Our advertisers and
media partners…
who expect our platforms to respect and promote their
messages in a way that’s safe and secure for their
own customers;
Our suppliers and
publishing partners…
many of whom are experiencing increased costs and
supply challenges;
Our shareholders…
who are invested in the success of our business;
Pension funds and
their members…
who expect us to deliver on pension commitments and
treat them fairly; and
Government and
regulators…
who we work with to protect journalists and our brands
while setting out plans to bring tighter regulation to global
tech platforms.
Our section 172 statement can be found on pages 85 to 87. It sets out how the Board has, in
performing its duties over the course of the year, considered the matters set out in section 172
of the Companies Act 2006, alongside examples of how each of our key stakeholders has
been considered and engaged.
We report against the Sustainability Accounting Standards Board (SASB) framework on
page 205.
Building on our responsible
business framework
To ensure that people find our strategy
credible and believe in our purpose, we must
act responsibly with the communities and
society we serve, our teams and the planet.
As a regulated news publisher in an era of
global tech platforms and ‘fake news’, the
responsibility is greater than ever. We must
continue to enlighten, empower and entertain
people everywhere through brilliant journalism
they can trust, and maintain a position
from which we can hold power to account.
Formalising our approach to
responsible business
In 2022, we carried out a detailed materiality
assessment and created a framework to
formalise our approach to being a responsible,
sustainable business – making it easier to
manage and measure our progress. It provided
a clearer articulation of our approach to
environmental, social and governance (ESG)
issues, ensuring it aligned with our purpose
and business strategy, as you’ll see over
the following pages.
This formal framework set out an approach
to responsible business that we had already
in many ways exemplified, for example by
upholding regulations and codes of conduct,
representing and campaigning on behalf of
those who need our voice, and producing our
printed newspapers with as low a carbon
footprint as possible.
In 2023, we built on the framework by
commissioning a gap analysis to define where
disclosure gaps exist against the methodologies
recommended by Sustainalytics, MSCI and
the Sustainability and Accounting Standards
Board (SASB). As a result, we have enhanced
reporting in many of these areas, though in
some – in particular those involving complex
editorial decisions – we agreed as a business
to maintain existing levels of disclosure.
We’re committed to continually challenging
and improving the standard of our reporting,
making sure we stay focused on the issues
that matter most to our stakeholders.
Overview of materiality
Our 2022 materiality assessment
included a review of current policies and
direct engagement with our key internal
and external stakeholders to establish
their priorities in relation to the long-
term sustainability of our business.
In 2023 our Sustainability Steering
Committee reviewed the material
issues within our responsible business
framework and concluded that they
reflect the current ESG challenges and
opportunities affecting Reach and our
stakeholders. We will keep the relevancy
and importance of these issues under
continuous review throughout the
coming year.
Responsible business overview continued
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Responsible business continued
Relevant UN SDGs
MyLondon crime reporter talking
to police about knife crime in shops
and restaurants around Croydon
We give a voice to others with our
trusted, quality content
Our titles connect people and communities
across the UK, Ireland, US and English-speaking
countries around the world. We have a
responsibility to our communities to deliver
accurate, independent journalism everybody
can trust and cover the issues that matter
most to them.
Whether it appears in print or online, our
journalism can give a voice to others, and
draw attention to, or amplify, the causes they
care for as we campaign, lobby and fight on
their behalf. At a time when misinformation
and disinformation threaten the credibility
of the industry, our commitment to creating
trusted, quality content as a regulated news
publisher ensures people and communities
have a news provider who will serve and
stand up for them.
CREATING TRUSTED,
QUALITY CONTENT
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Responsible business continued
Creating trusted, quality content
Playing our part in
a changing industry
We’ve always been proud of the prominent
role our brands play in the vibrant and
energetic free press that underpins our
democracy – and understand the rights,
privileges and responsibilities it brings.
We’re committed to upholding the highest
ethical standards of journalistic practice. As
part of that commitment, we’re a member of
the Independent Press Standards Organisation
(IPSO): an independent regulator of most of
the UK’s newspapers and magazines. As we
say in our annual statement to IPSO: we have
‘no appetite for behaviours or decisions that
knowingly lead to the publication of inaccurate,
misleading or distorted information’.
In 2023, IPSO notified us of outcomes in respect
of 81 complaints, some of which were received
in previous years. These are as follows: 17
complaints have been upheld by IPSO with
the requirement to publish a full adjudication
or correction; and 13 where the Committee
deemed that sufficient remedial action
(SRA) had been taken by the publication.
49 complaints were not upheld and 65 were
resolved during the referral period. This is a
significant improvement against outcomes
last year – 62% of complaints not being upheld
in 2023 compared with 48% for the same
period in 2022.
Legal and ethics standards
In 2023, our legal and editorial induction
programme became a mandatory part of the
onboarding process, ensuring all new editorial
colleagues receive training in legal and
editorial standards and ethics.
The training touches on all elements of media
law, with modules on IPSO and the Editors’
Code as well as on Reach’s required editorial
standards. Monthly legal training has been
provided, with a specific focus this year on
refresher training for colleagues as well as
specialist sessions for our magazine teams.
Alongside the training programme, all editorial
employees are sent a monthly legal bulletin
highlighting issues and updates – readership
is mandatory and timely compliance is
monitored and logged.
Regulated by IPSO
While we believe in holding ourselves to high
standards, we’re also an active member of
IPSO, which acts as an independent regulator
across many UK titles and enforces the Editors’
Code of Practice.
HOW WE ARE USING AI
Our editorial leaders formed a
cross-functional AI steering committee
in January 2023, focusing on productivity,
innovation and governance. The group
has worked together to accelerate AI
experimentation and boost productivity
gains with a primary focus on editorial
uses of generative AI. The main objective
of the group was to develop ways for AI
to support journalists in their daily work,
in combination with continued editorial
judgement and approval. We are rapidly
scaling the most promising AI applications
and in 2024 we will be looking beyond the
editorial teams to explore productivity
gains in other departments.
In 2023, 6,000 articles were written with
the support of AI tools, generating 50m
page views. Our editors notified readers
when we began using AI and made a
public commitment that every piece of
AI-supported content will continue to be
overseen and approved by a journalist.
“We’re committed to
upholding the highest
ethical standards of
journalistic practice.”
We submit an annual statement to IPSO that
sets out how we maintain editorial standards,
our record on editorial compliance during
the year, including any details of complaints
upheld against us and how we handle them,
and training programmes for our journalists.
We publish the statement on our website.
Editorial freedom
Reach is home to many brands that differ in
audience and political ideology but which are
all built on the principles of freedom of speech
and editorial independence. We welcome
lawful expression from different perspectives,
without exclusion. With no single title or
contributor representing Reach as a whole,
we are greater than the sum of our parts.
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Day in, day out, our journalists cover the stories that
matter most to the communities they serve. Our titles
hold power to account on both a local and national level,
give a voice to those who need it most and campaign
against injustice.
This year, we established a group-wide editors’ forum
that meets every quarter to review and document the
positive social impact of the content Reach produces.
DAILY EXPRESS’S TRIPLE LOCK PENSION AND
SAVE OUR HIGH STREET BANKS CAMPAIGNS
In 2023, the Express continued to give a voice to those
who needed it most, as illustrated by its Triple Lock Pension
and Save Our High Street Banks campaigns. The Express
reignited its Triple Lock Pension campaign in 2023, again
calling on the Government to protect and support
pensioners and recommit to the triple lock. The title
launched a petition to persuade the Government to stick
to its manifesto promise, garnering over 300,000 signatures
and resulting in the Government committing to its original
promise. In response to warnings from analysts that almost
all high street banks will be shut within four years, the Save
Our High Street Banks campaign called for high street
branches to be saved from extinction on behalf of the
country’s most vulnerable. Ultimately, the campaign
celebrated a victory in June when Nationwide
promised to keep high street branches open.
THE LIVERPOOL ECHO’S
POLITICIAN PARKING FINE EXPOSÉ
After a 16-month investigation, the Liverpool
Echo revealed 14 local politicians had 51
penalty charge notices cancelled by officers
over a five-year period which at full price would
total more than £3,500. The investigation revealed
poor practices and behaviours from those who
had been elected to serve Liverpool and its people.
Following the investigation, two senior Liverpool councillors left
the council, with one of them banned from standing again,
and two more councillors also departed after the exposé.
The investigation led to a full audit of the council’s
parking operations.
THE DAILY RECORD’S OUR KIDS
OUR FUTURE CAMPAIGN
In February 2023, the Daily Record
launched the Our Kids Our Future
campaign in response to an epidemic of
teenage violence in Scotland. The campaign
called for the Scottish Government and local
councils to ring-fence funding to ensure
every community has a place for teenagers
to go and demanded online tech giants
fully enforce their policies on tackling harmful
content such as videos of young people attacking others.
The campaign earned its place on the Government agenda
and led to First Minister Humza Yousaf pledging to invest £2m
to protect young people in Scotland. Humza Yousaf also wrote
to the UK Government asking for an amendment to the Online
Safety Bill to help tackle online clips showing attacks on children
and this amendment was successfully approved into the Bill in
July 2023. The Scottish Government held its first emergency
summit on violence in schools as a direct result of the
Record’s reporting.
Responsible business continued
Creating trusted, quality content
CAMPAIGNING
ON BEHALF
OF OTHERS
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BIRMINGHAMLIVE’S COVERAGE OF
BIRMINGHAM CITY COUNCIL’S BANKRUPTCY
Fundamental failings at Birmingham City Council resulted
in it filing for bankruptcy, but it was the relentless coverage
from BirminghamLive that brought into sharp relief the
impact that these political decisions have on the people
of Birmingham.
BirminghamLive spent months reporting on the council
and exposed a range of issues, from political coups to the
mismanagement of refuse workers’ hours. The title ensured
that it was represented at every single council meeting
where critical issues were being discussed, further exposing
issues that would otherwise have gone without scrutiny.
THE MIRROR’S SAVE OUR TICKET OFFICES CAMPAIGN
The Mirror launched its Save Our Ticket Offices campaign in
July 2023 after it was revealed the Government had backed
proposals by train firms to shut ticket counters at 974 railway
stations across England.
With this campaign, the Mirror led the efforts to stop the closures,
which would have particularly hit the elderly, vulnerable and
disabled. Thousands of readers took part in an online rally in
August, leading to the Government abandoning the overhaul.
WALESONLINE INVESTIGATION
A WalesOnline investigation led to real-world
consequences for one direct sales firm in Cardiff. For
several months, a member of the WalesOnline team went
undercover to get a job with the company and used a
hidden camera to expose a culture of lies and pressure-
selling to manipulate vulnerable and elderly people into
providing their bank details for charity payments. As our
journalist discovered, staff at the business were lured by
job adverts with empty promises of high salaries, only to
be forced to work round the clock for far less than the
minimum wage. The shocking findings led to the firms
involved having their fundraising contracts terminated,
while the industry regulator is evaluating our footage to
assess further action.
Responsible business continued
Creating trusted, quality content
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Responsible business continued
Operating with integrity
Relevant UN SDGs
A proactive approach
We’re committed to acting ethically and
with integrity in everything we do, from how we
source, report and disseminate our journalism,
to how we run our business and treat our people.
By upholding these standards, and meeting
those set by regulators and expected by wider
society, we’re able to support our journalists
and those our journalism empowers in holding
authority to account.
In recent years we have continuously
formalised our approach to key policies and
practices for all our employees, as detailed in
this section. We also have a number of training
processes geared specifically around our
editorial teams – see page 41.
Ahead of 2023 we took the decision to go to
trial around several long-standing historical
legal issues. This step and resulting judgment
has given us the necessary clarity to draw a
line under these issues and move forward as
a business – read more on page 10.
OPERATING
WITH INTEGRITY
Operating in an increasingly digital world
brings additional challenges regarding data
protection and cyber abuse. We now handle
more of our customers’ data than ever – and
we must treat it carefully and give visitors to
our sites a safe online experience.
Strategic Report Governance Financial Statements Other Information
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Responsible business continued
Operating with integrity
Improving ethical standards online
As we move more of our business online, our
responsibility to our customers and advertisers
is greater than ever. Customers deserve and
expect a safe experience, while advertisers
need to trust their ads will appear in
appropriate environments.
Our machine-learning-powered brand safety
tool, Mantis, ensures our clients’ ads only
appear in safe, appropriate environments,
proving 100% accuracy and a faster safety
categorisation, compared to traditional
blocklist methods.
Reach remains an active participant in industry
bodies. We comply with the Advertising
Standards Authority’s (ASA) Code for Non-
broadcast Advertising and are members of
The Trust Project, whose mission is: ‘To amplify
journalism’s commitment to transparency,
accuracy, inclusion and fairness so that the
public can make informed news choices’.
Our CEO Jim Mullen has been the chair of the
News Media Association (NMA) throughout
2022 and 2023, stepping down as planned at
the end of 2023. Reach is also a Board Member
partner of the Internet Advertising Bureau and
a member of the News Media Coalition.
Data privacy progress
As customer data forms an increasingly
important part of our strategy, we take our
responsibilities in relation to privacy very
seriously. To reduce the risk in how we handle
and process data, we maintain a robust policy
framework, deliver mandatory annual training
for all employees and issue specific guidance
on high-risk processing operations.
Protecting our customers
and their data
In 2018, when the General Data Protection
Regulation (GDPR) and the Data Protection Act
(DPA) were introduced, we brought in policies,
controls, procedures and mandatory training
to manage personal data. Following our 2023
expansion into the US, we now also comply
with US privacy laws such as the California
Consumer Privacy Act, the Virginia Consumer
Data Protection Act and the Utah Consumer
Privacy Act.
Principles:
Consumer trust
and rights
Lawful processing
Reach only processes personal
data where it has a legal basis to
do so.
Fairness and transparency
Reach processes personal
data fairly and honestly, and
communicates openly with
individuals on how and why
their data is being processed.
Individual rights
Reach respects individuals’ rights
in relation to their personal data –
including their rights of access,
rectification, erasure, restriction,
portability and objection – and
provides timely responses.
Principles:
Data management
practices
Data minimisation
and limitation
Reach only collects, stores and
processes personal data that
is relevant and necessary for the
purpose for which it was collected.
Stewardship
Reach is committed to protecting
individuals’ privacy and has
appropriate policies, practices
and training in place for the safe
handling, storage, sharing, retention
and deletion of the personal data
it processes.
Data security
Reach takes appropriate technical
and organisational security
measures to protect personal data
throughout its data lifecycle, and
requires the same standards from
its third-party service providers.
DATA PROTECTION PRINCIPLES
In 2023, we developed a core set of fundamental principles to further embed a culture
of data trust and integrity across every area of the business in all countries we operate in.
These principles form the bedrock of our approach, inform our priorities and ensure we act
with integrity when dealing with consumers’ data.
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Responsible business continued
Operating with integrity
Alongside our Data Protection Policies and
controls, our data protection team performs a
key compliance role, working closely with teams
across the business. The data protection team
works particularly closely with the legal team
and other key stakeholders such as data
management, information security and
information technology, offering advice
on, and support with, third-party contracts.
It also supports other personal data needs, for
example risk management, management of
consent, data security and best practices for
the processing, sharing and retention of data,
including data transferred to third parties.
The data protection team also leads on
personal data incident management and
timely data subject rights compliance – for
which we have comprehensive procedures.
Key policies and practices
Some things are non-negotiable, which is
why we take a strong stand on areas such
as anti-bribery, anti-corruption, anti-slavery
and discrimination. It’s also why we’ve put
policies and practices in place to make sure
our employees are treated fairly at work.
Information regarding our policies is
available to read on our website.
Anti-bribery and anti-corruption
• We comply with relevant anti-bribery and
anti-corruption laws, and have put in place
an Anti-bribery Policy and compulsory
e-learning module on anti-bribery and
anti-corruption for all employees. This
module was completed by 98.4% of
employees, with leavers and long-time
absences accounting for the missing 1.6%.
• We require our suppliers, contractors and
business partners to comply with the law
and include mandatory warranties on
anti-bribery and anti-corruption in our
contracts to support this. We only work
with suppliers, contractors and business
partners that comply with the law.
Anti-slavery
• Our Anti-slavery Policy, in accordance
with the Modern Slavery Act 2015, sets out
our zero-tolerance approach to slavery,
child labour, bribery and corruption –
and indicates to employees what slavery,
servitude, forced or compulsory labour and
human trafficking might look like. It applies
to all our employees and anybody who
works on our behalf. Generally the UK
is considered to be low-risk for modern
slavery and, as a UK-based company that
deals overwhelmingly with UK suppliers,
we believe we have minimal exposure
to modern slavery.
Code of conduct and discrimination
• Our code of conduct makes it clear we won’t
accept discrimination of any kind – including
against gender, race, disability, sexuality,
religion or age – in line with the law. To
reduce the likelihood of discrimination taking
place, we communicate policies and make
them available to all employees, promote
awareness when we recruit and train our
managers in inclusive hiring.
Disciplinary and grievance processes
• Every Reach employee has the right to be
heard and the right to a fair hearing; they
can also seek advice through our Employee
Assistance Programme.
Inside information
• As Reach is a listed company, we have an
established Inside Information Policy, which
is approved by the Board and ensures our
employees are aware of our obligations
under the Listing Rules and the Market
Abuse Regulation.
Whistleblowing
• Our whistleblowing charter, which is
reviewed by the Audit & Risk Committee, and
a confidential, independent whistleblowing
line promoted on our intranet, enable all
employees to report concerns about the
integrity of the business or breaches of
our policies without fear of criticism
or discrimination.
Our employees complete compliance courses
relating to many of our policies and practices,
plus courses including cyber security, editorial
policy and corporate criminal offence. We aim
for 100% of employees to complete courses
relevant to their role. In 2023, we saw a 98.5%
completion rate, with leavers and long-time
absences mainly accounting for the
missing 1.5%.
OUR HUMAN RIGHTS POLICY
The policy states that:
• we issue clear contracts of
employment, make sure working
hours are well within the working time
directive maximum thresholds, and
commit to never forcing our people
to opt out of working time regulations;
• we pay employees for the work they
do and provide holidays and rest
periods in line with regulations;
• we monitor holiday usage with
our leave and time management
process, and regularly encourage
colleagues, directly and via
managers, to take their
full entitlement;
• we pay above the national minimum
wage, and never subject anyone to
forced labour; and
• we have no zero-hour contracts.
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Operating with integrity
Working together to achieve a safe
working environment
We understand that engagement is essential
to improving health and safety across every
area of our organisation. With this in mind,
we continue to engage with our employees
across all departments to ensure that our
safety messages and culture are embedded.
Our goal is to ensure that our teams feel
personally invested in Reach’s safety
objectives and goals. We believe that this
approach will help us create a safer and
more productive workplace for everyone.
Reach is a dynamic organisation with two key
operations: Reach Publishing, which covers
newsgathering and commercial activities,
and Reach Printing Services. In 2023, the two
operations continued to grow closer together,
with their respective health and safety units
becoming aligned and working closely
together to standardise and share
best practices.
Our commitment to health and safety was
recognised in 2023 when both health and
safety teams achieved the RoSPA Order of
Distinction Award – the 19
th
consecutive
Gold for Reach Plc.
2023 also saw the move to a single
certification for the ISO standards across
Reach Printing Services, with all sites now
certified to ISO 9001 (Quality Management), ISO
14001 (Environmental Management) and ISO
45001 (Occupational Health and Safety). With a
single certification confirmed by an accredited
certification body, Reach Printing Services has
shown its commitment to health and safety
and the confirmation of a single process to
control, manage and improve safety across its
print sites, emphasising employee participation
and management involvement.
In addition, we prioritise online safety, with
a dedicated Online Safety Editor leading the
way internally and with external bodies and
decision-makers. While this is most frequently
concerning our people’s mental wellbeing,
there is a physical safety aspect too, which
sees the Online Safety Editor working closely
with our security team and Health & Safety
to put additional protections in place when
necessary. For more on online safety,
see page 41.
Key changes we’ve made
This year, we’ve continued to gather the
latest news stories across the globe, from
reporting from war zones in Ukraine and Israel
to covering earthquakes in Marrakesh and
Turkey, to exposing the real impact of climate
change from glaciers in Argentina. To enhance
the safety of our people on the ground we’ve
been working with teams across several
departments to create a safety travel team.
This team has rolled out a new travel risk
assessment platform that allows us to work
collectively to create one single assessment
that covers all areas of risk. The process is
open and transparent so the requester can
track progress and feel actively part of the
assessment process. Since the platform’s initial
roll-out, we have seen a monthly increase in its
use, and the user experience and approval
process have been continuously improved
as the tool has been integrated in both our
national and regional teams’ practices.
In addition to the new travel platform, we have
also streamlined some of our risk assessment
processes by creating engaging and concise
safety information that enables our people to
efficiently assess risks.
We have also made improvements to our fire
safety processes by adopting a new, shared,
digital fire risk assessment, which has helped
us reduce risk quicker and communicate the
assessment more efficiently.
Health and safety performance
in 2023
In 2023, information on four accidents
reportable according to Reporting of Injuries,
Diseases and Dangerous Occurrences
Regulations 2013 (RIDDOR) was passed to the
Health and Safety Executive – an increase of
one from 2022’s data.
We investigated each event and acted
accordingly. All four were reported under the
‘over-seven-day incapacitation’ requirement.
This is when an employee is off work or not able
to perform their normal duties for seven days
or more as a result of a workplace accident.
Reportable accidents under RIDDOR
2019 2020 2021 2022 2023
RIDDOR events
per year 2 1 3 3 4
Health and safety
enforcement activity
No health and safety enforcement action was
taken against Reach in 2023.
Planning for the future
At Reach, we’re committed to creating the
safest working environment possible. That’s
why we have a rolling two-year roadmap for
health and safety, and we’re always looking for
ways to continuously improve this, including
benchmarking ourselves against other leading
media outlets and also across other industries.
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Responsible business continued
Developing our team
DEVELOPING
OUR TEAM
Relevant UN SDGs
Taking care of our people
Our progress as a business is dependent on
the talents, skills and passions of our people.
This year, we supported our teams through
change with a continued focus on open
communication, working together to be a
more inclusive organisation, and supporting
people in their personal and family lives.
19
Inclusive
Top 50 UK
Employers
ranking
86%
Company-wide
participation
for Be Counted
inclusion data
18
trained
wellbeing
champions
27
trained Online
Safety reps
49
apprentices
trained
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Responsible business continued
Developing our team
Supporting our people’s
mental health
We take our responsibility to support our
people very seriously and we provide several
tools to help do this, while also signposting
options available via multiple touchpoints
through the year, both in written and
verbal communications.
Our Employee Assistance Programme (EAP)
offers 24/7 advice via a dedicated phone
line and the Spectrum Life app, which all
employees can access. The app provides
support including guides for wellbeing and
nutrition and a BeCalm space for guided
meditations. A total of 237 calls were made
to the phone line in 2023 – 146 of these
were consultations and 91 were for advice.
We further support mental health by providing
wellbeing training sessions for managers and
employees and by working with 18 trained
wellbeing champions across the business.
They have many responsibilities, including
advocating wellbeing and mental health
awareness, raising awareness of resources
such as our EAP, being there for people as a
point of contact for questions and support
and, sometimes, as a listening ear.
An external partner trains each champion
in mental health first aid (MHFA). The training
helps them to spot triggers and signs of poor
mental health and to gain confidence on how
to reassure and support a person in distress.
It also helps our champions understand
mental health, educating them on common
issues and how to challenge stigma.
Protecting our people from
online abuse
Journalist safety was a continued focus for
Reach in 2023 and we continue to lead the
industry by employing a designated Online
Safety Editor to support our people. The Online
Safety Editor also leads on research and speaks
on this important issue with tech platforms,
Government officials and other external bodies.
Our work protecting our people was highly
commended at the Digital Publishing Awards,
with the jury recognising that prioritising the
safety of journalists is a significant step in
protecting independent journalism.
In 2023, 109 of our employees officially reported
some form of online abuse related to their
work, including threats, sexual harassment and
harmful personal comments. 26 of these cases
were subsequently reported to the police.
We also saw an increase in threats received
via email during 2023. In response, we have
worked more closely with the IT team to
improve the filtering of these messages.
We launched an Online Safety Rep network in
2022, which currently has 27 trained volunteers
working in teams across the organisation to
provide first-response support and, signposts
to help and resources, as well as raising
awareness of effective online safety protections.
The Online Safety Editor co-ordinates the
network and provides regular training and
updates for the network members.
We have also continued to make use of
the Reach Hive initiative, which supports
employees experiencing a backlash against
content on social media. It was deployed
five times in 2023 against action including
swarming accounts, which were part of a
significant organised and targeted backlash.
The Reach Hive initiative provided a robust
response from online safety, security, HR
and health and safety.
In 2023, Reach continued to work with industry
partners Women in Journalism (WiJ) and
provided free training and workshops to all
Reach employees and WiJ members, for
example working with the Suzy Lamplugh Trust
to provide a session about stalking. In addition,
we’ve partnered with the Coalition Against
Online Violence, a global network of
organisations working to make the
internet a safer place.
Reach is made up of…
3,706
permanent employees
2,418
in editorial teams
596
in commercial teams
353
in print teams
339
in other vital areas, such as
product and finance
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Inclusion at Reach
At Reach, we break down our diversity and
inclusion approach into two simple ideas:
diversity is who we are, and inclusion is what
we do. We see improving inclusivity as an
ongoing process and are aware that we are
responsible for taking an inclusive approach
not only to our people but also to
our audiences.
In 2023, Reach was ranked in the Inclusive Top
50 UK Employers List for the third year running,
moving from 29 to 19.
Our three core inclusion focuses for 2023 were
managers, data and outreach.
Managers
Inclusion efforts in 2023 focused on helping
managers embed inclusive leadership
behaviours into their everyday work. We also
successfully communicated the importance
of managers’ accountability by launching DIY
D&I, enabling managers to participate in
workshops that enhanced a more inclusive
team culture. DIY sessions were available for
managers to run with their teams
independently.
We also updated our menopause toolkit to
help both colleagues and their managers. The
toolkit shares the most common symptoms
of menopause and perimenopause and
provides advice and help so our people feel
more comfortable talking about it. Suggested
supports include offering a change in working
hours, an adjustment to shift patterns,
increased comfort breaks and ensuring
workspaces are well-ventilated, to name just a
few. We also delivered menopause awareness
training for line managers to run with their
teams independently.
Data
Our Inclusion strategy continues to be led by
data. Be Counted is our ongoing campaign,
launched in 2021, which uses data to better
understand the make-up of our teams.
Gathering data allows us to spot gaps and
opportunities to improve inclusion and then
focus our efforts on where we can make the
most significant difference. In 2023, we
maintained our targeted Be Counted
completion rate, with 86% of employees
contributing to our data-gathering. Our people
shared data on characteristics including
social mobility, educational and occupational
backgrounds, and caring responsibilities, as
well as more traditional data, such as ethnicity
and sex.
Outreach
We made outreach a more explicit part of
our 2023 Inclusion strategy this year. Here are
some of the initiatives that gave opportunities
to different groups across the UK.
ChangeMakers Media Challenge
The ChangeMakers Media Challenge, in
partnership with youth charity Causeway
Education, was a six-week summer outreach
programme in social mobility hotspots for
students from state-funded schools. The
students received virtual masterclasses
Responsible business continued
Developing our team
Sir Keir Starmer speaking with local students during a visit to our
Manchester hub, hosted by the M.E.N.
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and mentoring across the summer and were
tasked with creating a media campaign to
improve the lives of 16- to 24-year-old readers.
More than 30 colleagues participated in and
supported the programme. As well as having
the opportunity to join the Mirror’s editorial
conference and hear from CEO Jim Mullen,
the students got the chance to pitch their
campaigns to a Reach judging panel, with
the winning teams taking on further work
experience in Reach newsrooms.
WalesOnline Outreach Programme
In February, WalesOnline hosted a group
of teenagers from Grangetown, Butetown
and Riverside for a taster day to help them
understand how the media works and show
potential routes into journalism. In partnership
with community group United2Change, 17
teenagers spent three hours in WalesOnline’s
newsroom attending the morning conference,
speaking to reporters and content editors,
creating news lists and gaining an awareness
of all aspects of modern reporting, including
engagement, analytics and content.
Include Summit
Reach was one of the main sponsors of
the 2023 Include Summit, the UK’s largest
conference focused on equality, diversity
and inclusion in sport. Our colleagues from
the M.E.N., Mirror and Curiously participated
in panels, exhibitions, events and workshops.
Reach also joined forces with the BBC and
Sky to lead a discussion on the need for
under-represented communities to fill more
decision-making roles in sports media.
Networks
Colleague networks remain a vital part of
inclusion at Reach. In 2023, the business
evaluated how the networks were working,
combining some networks while expanding
others. One new network was created in 2023,
ReachSustainability, connecting like-minded
people across Reach to raise the profile of
ESG initiatives and champion best practices
around sustainability. For more information
on ReachSustainability, please see page 47.
One of the most successful network initiatives
in 2023 was Meno-Chat, which enables
colleagues to connect and gives our
people a confidential and safe space
to talk about menopause.
Editorial inclusion work
For our people to feel their work is making
a difference in society and for our brands to
remain popular, the content of our journalism
must represent both the diversity of our teams
and the communities it reaches.
This year, we refined several ways to help our
editorial colleagues achieve this. Our Editorial
Inclusion Board (EIB) reviews our processes
and content through an inclusion lens, creating
a feedback loop to make our people’s voices
heard. This year, we completed our Inclusive
Reporting programme. Led by our EIB and
working with external partners, the programme
helps our journalists feel comfortable reporting
on different topics and communities inclusively
and sensitively. The programme featured topics
including (but not limited to) race, sexual and
domestic abuse and transgender identity.
Our Speak Up for Inclusion process allows
Reach colleagues to share any concerns
about editorial content that could be more
inclusive. A panel of editorial colleagues from
across Reach editorial teams manages a
feedback inbox and discusses the next steps
and overall trends.
Celebrating inclusion in
our journalism
Since its launch in 2022, The Belonging Project
has continued to bring about a permanent
culture shift in our newsrooms. The project
aims to ensure a clear plan is in place across
all newsrooms to reach underrepresented
communities, encourage more inclusive
reporting and maintain consistent engagement
with marginalised groups. In 2023, the scope
of The Belonging Project was broadened to
include socioeconomic factors, recognising
the importance of intersectionality in inclusion.
The Belonging Project article with the most
page views of 185.6k was from the Manchester
Evening News, focusing on the uplifting story of
Jason Williams, who turned his balcony into a
beautiful ‘cloud garden’ after struggling with
his mental health through lockdown. What
started as a small, city-centre balcony
garden led to his exhibition at the
Chelsea Flower Show.
Responsible business continued
Developing our team
The total number of
The Belonging Project page
views from February 2022
to December 2023 was…
27.4M
with
69%
of these page views attained in 2023
Average articles published per
month have gone up…
62%
in 2023 vs 2022, and average page
views per month are up
104%
as a result
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Supporting people with disability
We’ve continued our commitment to
giving fair consideration to applications
for employment made by disabled people,
bearing in mind the requirements for skills and
aptitude for the job. In the areas of planned
employee training and career development,
we strive to ensure that disabled employees
receive equal treatment on all available benefits,
including opportunities for promotion. We
make every effort to ensure that continuing
employment and opportunities are also
provided for employees who become
disabled, where reasonably practical to do so.
In addition, we are founding members of the
Valuable 500, a disability-focused business
collective – read more about this below.
Mentoring programmes
In 2023, we ran the following four cross-
company mentoring programmes to address
representation in the talent pipeline.
Mission Gender Equity
For the third year running, we participated
in the 30% Club’s Mission Gender Equity,
a mentoring programme that works with
participants from other companies to help
accelerate the careers of high-performing
women and improve gender balance at
senior levels.
Generation Valuable
Run by the Valuable 500, a disability-focused
business collective, Generation Valuable is a
first-of-its-kind 12-month programme for rising
talent with an attachment to disability. In 2023,
one mentee with leadership experience, who
self-identified as being disabled, was paired
with CEO Jim Mullen as a mentor.
Mission Include
Mission Include is a nine-month scheme
designed to support the career progression
of groups underrepresented at a leadership
level and supports protected characteristics,
including socioeconomic background and
neurodiversity. Reach provided both mentors
and mentees, and participants were matched
with people from other companies.
The Bridge
The Bridge was a nine-month programme
pioneered by our ethnicity inclusion network,
ReachCulture, which paired together mentors
and mentees from within the business, for
both traditional and reverse mentoring. The
Bridge helps to remove barriers to progression
for colleagues from underrepresented groups
and gives mentees the knowledge, access
and tools they need to advance their careers.
Proactive employee
communication
As we worked through the changes of the year,
we made proactive, two-way communication
with our leaders and teams a priority. Jim
Mullen, our CEO, devotes significant time to
communicating with employees at all levels of
the organisation and across all functions, not
only around financial results but throughout
the year. He hosts regular breakfast discussion
sessions, both in-person at our hubs and
virtually, and invites people to ask him
questions and give feedback.
This year, more than 200 people attended 23
breakfast and afternoon meetings with Jim.
On average, they rated their experience 8.6
out of 10, with people praising Jim’s openness,
honesty and commitment to connecting with
his colleagues. On Fridays, Jim sends an email
update to all colleagues highlighting success
stories, commending colleagues for their work
and sharing essential business updates.
Our Executive Committee runs regular virtual
and in-person events with our teams to share
updates and encourage dialogue. Members
of our Executive Committee speak openly
about our challenges and opportunities and
share information about the wider business.
We regularly share Company news, updates
about our financial results, stories about our
people and event information through our
intranet and email newsletter, connecting
all our employees with what’s happening
in our business.
Responsible business continued
Developing our team
Gender pay gap
In 2023, we again reduced our gender pay
gap – the median pay gap from 8.9% in 2022
to 7.0% and the mean pay gap from 10.5% in
2022 to 9.1%.
For more information on the gender split of
directors, other senior managers and all
employees, see page 92.
Changing our teams
The business contended with a range of
challenges in 2023, including increased costs,
a decrease in referral traffic in page views
and ongoing macroeconomic uncertainty.
In order to respond to these challenges
we had to prioritise two actions: putting a
comprehensive cost-reduction plan in place,
and continuing to reshape our organisation
to better respond to the digital landscape.
This plan included reducing the sizes of our
teams, across all departments, a challenge
for all our people. Throughout this process
we have continued to provide support to
impacted individuals and to work closely
with our relevant unions and other partners.
The impact that these actions have on our
teams is not taken lightly. However, these cost
reductions were necessary to maintain the
strength of the business against difficult
conditions and to solidify its position as
a digital publisher moving forward.
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We also invite our people to join Connect &
Learn virtual teach-ins on critical strategic focus
areas, meet people in other departments, find
out about the brilliant work that’s going on and
share feedback. One example in 2023 was the
session on the success of the OK! Beauty Box.
Keeping in touch through surveys
and Check-ins
We invite our people to share their thoughts
and feelings about working for Reach through
our monthly Pulse engagement survey. On
average, 58% of our people complete the
survey each month. Line managers can
access responses, review comments and
identify trends using the data to reach out
to people and find new opportunities to keep
them engaged.
Our people keep in touch with their managers
through Reach Check-ins; these monthly,
informal one-to-ones enable managers to
speak honestly and openly with their teams
on anything from wellbeing to performance.
We also ask our people about these Check-Ins
with their manager in the monthly Pulse survey.
We also monitor retention rates and
absenteeism as critical indicators of
engagement and satisfaction. In 2023,
the voluntary rate of employee turnover
was 9.65%, reduced from 14.4% in 2022.
The retention rate (defined as employees
in Reach’s employment for the full 12 months)
was 88% compared to 95% in 2022. In 2023, the
Group’s absenteeism rate (which follows the
standard definition used by the Advisory,
Conciliation and Arbitration Service) decreased
to an average of 1.35%, from 1.7% in 2022.
We made two additional support payments
to help alleviate the cost of living burden going
into 2023 for colleagues on salaries of £50,000
or below. Eligible colleagues received two
£200 payments, paid in December 2022
and January 2023. The pay review for 2023
focused on lower earners and we continue
our commitment to offer our employees the
Living Wage Foundation rates as a minimum.
We also continue to offer
competitive employee benefits,
including:
• a defined contribution pension scheme
(matched up to 6% for new joiners);
• Company funded healthcare for all
employees which includes GP access
and the opportunity for colleagues to
claim back money on health and wellbeing
costs, including prescription, dental and
optical fees;
• enhanced family leave policies;
• paid volunteer day which gives colleagues
the opportunity to support causes important
to them;
• discounts at several retailers, including
supermarkets;
• loan schemes, including rail season
tickets, cars and technology purchases;
• financial support for those who are worse
off as a result of working from home; and
• money towards the cost of equipment for
home workers.
Talent: evolution and future
Despite its challenges, 2023 provided a
backdrop for a number of opportunities for
role creation, expansion and growth at Reach.
In 2023 there were 186 internal promotions and
4.3% of those were promotions into senior roles.
The year also provided an opportunity to
create 238 new roles which reflected the
changing landscape in which our business
operates and the direction we intend to take.
In addition, our local newsrooms continued to
provide training to newly graduated journalists,
and in 2023 we supported 79 trainees passing
their Certificate of Journalism course while
employed by Reach titles.
The external recruitment process was also
fine tuned in 2023, and we moved away from
spending with big recruitment agencies and
focused on developing our own internal talent
acquisition team. This shift enabled us to more
efficiently leverage talent acquisition technology
and scale our talent acquisition function to
keep pace with changing business needs.
Responsible business continued
Developing our team
In addition, all employees have the opportunity
to participate in a group bonus scheme annually.
Enhanced family leave
Family life isn’t always straightforward and
we want to recognise that to support our
colleagues. Our Carers’ Leave Policy offers up
to five days of paid leave per year to support
people with caring responsibilities. Our
neonatal leave offers up to 12 weeks’ additional
paid leave for either parent, if their baby needs
neonatal care. Partners have been added to
many existing policies, including IVF paid leave
and pregnancy loss leave, to increase support
beyond mothers who have given birth. We
offer two-week bereavement leave and all
employees coming back to work after losing
somebody can choose to phase their return.
Our apprenticeship programme
The future of news publishing requires a mix of
brilliant journalists, digital experts and astute
commercial minds and our apprenticeship
programmes are helping to find and train them.
This year, 49 apprentices participated in our
programmes covering data, communications
and journalism roles. Roughly half of these
people were new starters looking for
opportunities in the industry while the other
half were existing employees looking to
develop further within their roles.
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Responsible business continued
Protecting our environment
Relevant UN SDGs
Protecting our environment
for future generations
Every person, business and community on
the planet must play their part in safeguarding
the environment and in essence all our futures.
At Reach, our responsibility is twofold. We must,
like all businesses, reduce the negative effects
our operations have on the environment,
while identifying and acting on opportunities
to enhance it. But we also have the power to
influence others to do the same by promoting
awareness of environmental issues – both
on a local and global scale – across all
our publications.
Every day, we give millions of people who
read our news, entertainment and sport the
knowledge they need to make better, more
informed decisions about their own impact on
the environment. And through the stories we
share, and the championing role we play, we
also help people fight back against destructive
actions carried out in towns, cities and
countries all over our planet.
PROTECTING
OUR ENVIRONMENT
The Watford print site team on their annual litter picking day
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Reach plc Annual Report 2023
Our environmental campaigning
in 2023
We have dedicated environmental reporters
in England, Ireland, Scotland and Northern
Ireland who enlighten and empower people
everywhere by reporting on the environmental
stories that matter to the future of our planet.
Below is only a small selection of their great
work from 2023.
In July, the Mirror exposed the ‘catastrophic’
consequences of Britain’s love affair with
fast fashion. An investigation revealed that
Ghana’s capital, Accra, contains a toxic
mountain of ditched clothes and garments
left to rot.
The Manchester Evening News teamed up
with the Royal Horticultural Society (RHS) to
launch a competition to give away £1,000 of
RHS vouchers to the resident with the best idea
for transforming their shared ginnel (fenced
or walled passageway) into a blooming
community hub.
The Express continued to report on the biggest
environmental stories from around the world.
Back in March, the title exclusively revealed the
Government’s plans to make the UK a world
leader in green offshore wind energy. This
exclusive led to further investigations that
revealed the supply chain behind the
sectors creating clean power.
Irish Reach titles teamed up on a campaign
focusing on the climate crisis during 2023.
As Ireland has pledged to reach zero carbon
emissions by 2050, the campaign sought to
answer questions on how the world can kick
its fossil fuel addiction. Reach for Zero ran
across eight Irish titles including the Irish
Mirror and DublinLive.
The year also saw the Daily Record launch
its Bin the Vapes campaign, highlighting the
shocking rise in pollution from disposable
e-cigarettes, which was championed by
MSP Gillian Mackay. New legislation around
disposable vapes is now likely to pass in
Scotland and more widely in the UK in 2024.
How our people are supporting
sustainability
In 2023, we formed the ReachSustainability
network, which allows people across the
business to connect over their shared
passion for promoting sustainability,
while championing best practices around
sustainability, both at home and at work.
The network joined forces with Oxfam in the
autumn to launch its first environmentally
focused colleague campaign, ‘Reach does
Second Hand September’. The campaign
encouraged colleagues to shop second-hand
and donate, reuse, re-wear and restyle during
September. We worked with Oxfam to provide
a donation bin at every Reach hub across the
UK, encouraging our people to donate
unwanted items.
We also hosted a Q&A session open to
all Reach employees with Oxfam’s senior
independent fashion adviser and used
clothing guru Bay Garnett, led by Reach
Ireland’s environmental correspondent.
Making Reach more
environmentally-friendly
Our Environmental Policy has highlighted
several key areas of focus, including energy
consumption, waste management, paper
procurement and Volatile Organic Compounds
(VOCs). All of these are required in volume
to deliver content to our audiences and we
are determined to continue to find new and
innovative ways to manage our operations
that are more environmentally-friendly. To
deliver on this ambition methodologically, we
have implemented a continuous programme
of audit and analysis through our ISO 14001:2015
Environmental Management System (EMS).
This system enables us to reduce and mitigate
risks and to identify and act on opportunities
to increase sustainability.
Energy is our biggest direct source of emissions.
Print production and, increasingly, digital media
are both energy-intensive processes. We
continue to identify and take energy-saving
actions, such as the delivery of our facilities
efficiency programme and the procurement
of renewable electricity at our hubs and
manufacturing sites. This year we installed
over 9,000sq m of solar panels at our owned
print sites in Oldham, Watford and Glasgow.
All three sites are now generating their own
power and are largely self-sufficient during
daylight hours. Our combined PV generator
output of 2,000kWp – enough to power 217
average UK households – gives us a ready
source of renewable energy at our print
sites that makes our products even
more sustainable.
Responsible business continued
Protecting our environment
In September the Reach
Sustainability network hosted an
event with Bay Garnett, stylist and
sustainable fashion advocate, to
celebrate Second Hand September
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The indirect impacts of a business’s operations
are as important as the direct impacts. We
are committed to accurately measuring and
reducing our Scope 1, 2 and 3 emissions,
in line with the Paris Agreement. We have
now managed to baseline our full Scope 3
emissions for the first time, a challenging
task which was completed in 2023.
To help reduce the energy used within our
digital processes, including Reach Publishing,
we have adopted best practices for cloud-
based technology in order to achieve
significant emission reductions. During
2023, we have continued to find efficiencies
and improvements which will reduce our
associated emissions and strive to continue
this downward trend throughout 2024.
Enhancements are focused on cloud
efficiencies and an increased use of
AWS renewable energy sources.
With the assistance of our EMS, we can
continually review, identify and implement
opportunities to reduce negative environmental
impacts. This includes initiatives such as
substituting conventional lights and carbon-
intensive equipment with energy-efficient
alternatives, responsibly procuring equipment
and incorporating more recycled materials
into our processes.
Each of our print sites has a dedicated team
responsible for encouraging employees to
look after their work environments and specific
environmental action areas. This year, they
carried out litter picks across the sites, acted
on energy-saving initiatives, shared best
practices and continued to develop
and deliver their Toolbox Talks on waste
management, recycling, pollution control,
energy management and biodiversity.
Environmental governance and
the path to net zero
Our Environment, Social and Governance
(ESG) Steering Committee, chaired by our
Chief Financial Officer, sits under our Board
Sustainability Committee. The ESG Steering
Committee met three times in 2023 and
all meetings were well attended by
representatives from relevant departments
from across the business. The Committee
oversees all our environment-based key
performance indicators (KPIs), including our
emission reduction targets and actions and
the timeframes to achieve them. These targets
were set in 2022, based on the data available
at the time and were approved by the
Sustainability Committee.
In 2022, we commissioned external experts
to put together a materiality assessment, an
important step in informing our future ESG
agenda. The assessment led to a five-year
climate strategy, approved by our Sustainability
Committee. This presented our ESG Steering
Committee with a set of strategic targets and
an overall ambition to focus on and it has
been measuring and ensuring progress
towards these targets throughout 2023.
We have continued to make progress with
TCFD in 2023 by identifying the physical and
transitional risks posed by climate change, as
well as the opportunities that may arise as a
prevalent: ‘Purchased Goods and Services’,
‘Upstream Transport and Distribution’ and ‘Use
of Sold Products’ (includes digital emissions).
The graphic below shows the breakdown of
these emissions, with Purchased Goods and
Services being the largest contributor to our
GHG emissions.
The Scope 3 categories not deemed relevant
to Reach and which therefore will not be
reported, are:
• Category 9 – Downstream Transport and
Distribution (our distribution of goods is
covered in Category 4);
• Category 10 – Processing of Sold Products
(Reach does not process intermediate
products);
• Category 13 – Downstream Leased Assets
(Reach had no sublets in 2022); and
• Category 14 – Franchises (Reach does
not have any franchises).
Responsible business continued
Protecting our environment
Breakdown of Reach baseline emissions 2022
result of the transition. Our cross-functional
team continues to meet to assess our risks
and opportunities and engages with relevant
employees to ensure environmental-based
risks, issues and opportunities are being
identified as well as robustly managed and
mitigated. In 2023, we have undertaken a
quantitative assessment of our most material
climate-related risks. See more in our Risk report
on pages 66 to 72 and our TCFD report on
pages 54 to 64. The ESG Steering Committee
and Sustainability Committee will continue to
monitor the progress against our strategy.
Having a thorough and full understanding of our
Scope 3 emissions is an essential part of our
climate strategy. We have been expanding
our reporting on categories since 2019 and
in 2022 made great progress on reporting
greenhouse gas (GHG) emissions. In 2023, we
are proud to have continued that progress by
completing a full baseline of all of our GHG
emissions. We identified 11 ‘upstream’ and
‘downstream’ Scope 3 categories relevant
to Reach, three of which are particularly
54.1%
Purchased Goods
and Services
1.0%
Capital Goods
23.3%
Upstream Transport
and Distribution
2.77%
Other
3.82%
End of Life
Treatment
11.65%
Use of Sold
Products
1.75%
Employee
Commuting
1.6%
Our operations
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Our five-year climate strategy involves more
than just measuring emissions. We have
continued to meet our ambitious reduction
targets and having achieved and maintained
a 75% reduction in Scope 1 and 2 emissions
two years early, we are able to pursue further,
even more ambitious commitments (see
page 50 for details). We are also committed
to enhancing our engagement with our value
chain and using our leverage where possible to
persuade others to set their own net zero targets,
ideally aligned to a science-based target (SBT).
We recognise that the issues of climate
change and sustainability are complex.
We therefore provide regular training to
colleagues across the Group to help them
to better understand how they can make a
difference and help us on our net zero journey.
Our newly-formed Sustainability network
ran several events in 2023, including a
Sustainability Awareness training event
open to all employees. We also delivered
an in-depth training session on climate
emissions and environmental best practice
for our executive team and Board.
Our environmental performance
in 2023
Our total Scope 1 and 2 (market-based)
emissions has reduced by 15% from 2022
and has reduced 77% from the 2019 baseline.
For the first time, we are able to report our full
Scope 3 GHG emissions and can compare
them with our completed baseline of GHG
emissions for 2022. Our Scope 3 emissions
have reduced by 17% when compared to 2022.
The reductions are predominantly attributed
to Purchased Goods and Services, Upstream
Transport and Distribution and Use of
Sold Products.
Due to improvements in data quality we have
re-stated some 2022 emissions. For full details
of our environmental performance, see the
tables on pages 52 and 53.
Energy and emissions
Our gas consumption (kWh) in 2023 reduced
by 0.73% and electricity by 18.5% compared
with 2022.
Environmental management
Each year, our print and publishing sites are
both internally and externally audited against
the international environmental standard
ISO 14001:2015, which requires continuous
improvement on environmental impacts.
We work hard to meet and maintain, or ideally
better, our standards by continually reviewing
our risks and opportunities. It’s rare that
non-conformances are raised and all
hubs maintained the standard in 2023.
The year also saw the three print sites
integrate their standard under one ISO
certification. The newly-integrated management
system enhances the consistency of print ISO
management, covering Environment, Health
and Safety and Quality. In 2024, the scope for
the Publishing ISO 14001:2015 standard will be
reviewed to ensure it is still relevant and
reflective after the wider operational
changes carried out in 2022 and 2023.
Supply chain
As a news publisher, paper is essential to our
business, which is why we are committed to
responsible procurement. We set ourselves
ambitious targets to support our commitment
to using graphic paper from fibre that has
been recycled or that has been independently
certified as sustainable. In 2023, we sourced
97.28% of graphic paper from recycled
materials or wood from certified sustainable
sources, against our target of 95%. We
collaborate with contractors for the printing
of our magazine supplements and the
distribution of our printed products so when
entering into a contract we carefully consider
our contractors’ dedication to environmental
sustainability. We expect them to assess and
disclose the energy consumption and carbon
emissions linked to the work conducted during
the reporting year. Our five-year climate
strategy has outlined our desire to engage
more deeply with our biggest suppliers and
work with them to continually enhance the
environmental credentials of our products.
Waste
The unnecessary creation and poor
management of waste can profoundly
impact the wellbeing of our planet and natural
environments. We are therefore committed to
utilising the waste hierarchy – a ranking system
of waste management options according to
which is the best for the environment – in our
management of waste. We aim to reduce the
types and volumes of waste we generate while
reusing and recycling as much of it as possible.
This year, we also aim to enhance the granularity
of our waste reporting, continuing to report the
total volumes of hazardous waste from our
print sites, where most of the waste is produced,
and total weights of paper waste we recycle
from our print sites, which is our main non-
hazardous waste stream.
The comprehensive renovation of our hubs for
team members embracing the advantages of
hybrid work is now complete and we ensured
that we made as much use of sustainable and
recycled materials in this process as possible.
We are committed to ensuring 100% of our
waste electrical and electronic equipment
(WEEE) avoids landfill and is either recycled
or reused, so we have chosen a contractor,
Restore, that has a ‘zero to landfill’ policy.
Restore also uses electric vehicles, powers its
recycling processes via solar panels, and is a
signatory of the Climate Group’s EV100 project,
which brings together companies ‘committed
to accelerating the shift to electric transport
from around the world’. We have also been
considering the potential to donate electronic
items before they become WEEE and engaging
with charitable organisations who could
benefit from this.
Responsible business continued
Protecting our environment
Energy Efficiency Actions
• Invested in solar panels at all owned
print sites in order to increase our
renewable electricity usage.
• Replaced refrigerant gas cooling
equipment at our Watford print site
with a more efficient model to reduce
refrigerant usage.
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Responsible business continued
Protecting our environment
External ratings
We’re proud to have again been included
in the FTSE4Good Index, which measures
the quality and transparency of our
environmental, social and ethical disclosures.
In 2023, the Institutional Shareholder Services
(ISS) scored Reach at C in its Environmental,
Social and Governance (ESG) report. This year,
we completed ISS’s questionnaire on our use
of energy, water and waste treatment, as well
as social and governance issues. We scored C
for our ESG corporate rating and 1 for our ISS
environmental rating, indicating the highest
possible level of disclosure. This year, our
Carbon Disclosure Report (CDP) submission
scored B, an improvement on last year’s score.
We will continue to work to increase this score
in the future.
Meeting our compliance
obligations
We proactively monitor and maintain
environmental legal requirements and
other compliance obligations that apply to us,
including industry codes of practice, and take
action to make sure every part of our business
remains compliant with relevant obligations
while continually pursuing best practice. This
year, Reach completed all mandatory Energy
Savings Opportunity Scheme (ESOS) audits
and has had no prosecutions or compliance
notices for breaches of environmental law.
Targets and metrics
2023 Target Progress in 2023 2024+ Target
Climate change
We will reduce GHG emissions (Scope 1 + Scope
2 market-based) by 75% by 2025 versus a 2019
baseline and maintain this.
Achieved
We have maintained our GHG emission
reduction (Scope 1 + Scope 2 market-
based), having reduced by 77% in 2023
versus 2019.
We will reduce GHG emissions (Scope 1 + Scope
2 market-based) by 75% by 2025 versus a 2019
baseline and maintain this.
We will aim to reduce our electricity consumption
by an average of 5% annually over the next three
years to 2023 versus a 2019 baseline.
Achieved
Our electricity consumption in 2023 is
44.5% lower than 2019.
This target has been achieved and is being
replaced with our aim to submit a near-term
science-based target in 2024.
Maintain GHG emissions associated with
UK/domestic business travel in 2022 compared
with 2019, on a like-for-like basis.
Note: Overseas travel is excluded because
the requirement to cover news events
fluctuates year-on-year and is outside
the Company’s control.
Achieved
We have had a 73% reduction in
UK/domestic business travel GHG
emissions versus 2019.
Maintain GHG emissions associated with
UK/domestic business travel in 2022 compared
with 2019, on a like-for-like basis.
Note: Overseas travel is excluded because the
requirement to cover news events fluctuates
year-on-year and is outside the Company’s control.
Environmental management
We are aiming for a combined ISO 14001:2015
certification for all print sites under our ownership
across the UK within the next two years.
To maintain ISO 14001:2015 to all publishing sites
in scope.
Achieved
ISO 14001:2015 certification was
combined and maintained for
print sites.
ISO 14001:2015 certification was
maintained for publishing sites
in scope.
We aim to maintain the ISO 14001:2015 standards for
our three owned print sites and our publishing division.
We will review the scope of the Publishing
ISO 14001:2015 accreditation to reflect recent
changes to our working environment.
We aim to report GHG emissions on all relevant
Scope 3 categories in 2023.
Achieved
We have fully baselined our total GHG
emissions including Scope 3. 11 out of
15 categories are relevant to Reach
operations.
We will continue to report our full GHG emissions
across all three Scopes.
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Responsible business continued
Protecting our environment
Targets and metrics
2023 Target Progress in 2023 2024+ Target
Environmental management continued
This is a new target n/a To have our GHG emissions data
independently verified.
This is a new target n/a To develop the Group’s Sustainability Report.
Supply chain
We aim to use 100% graphic paper (all newsprint
and magazine paper grades) manufactured
from fibre using recycled materials or wood
from certified sustainable forests. We commit
to achieving at least 95% recycled materials
or wood from certified sustainable forests.
Achieved
Achieved 97.28% graphic paper
using recycled materials or wood
from certified sustainable forests, and
we continued to work with suppliers to
maximise this.
We aim to use 100% graphic paper (all newsprint and
magazine paper grades) manufactured from fibre
using recycled materials or wood from certified
sustainable forests. We commit to achieving at
least 95% recycled materials or wood from
certified sustainable forests.
This is a new target n/a We aim to identify and engage with our top 20
suppliers by GHG emissions, aiming to reduce our
Scope 3 emissions associated with them.
Waste and water
We will reduce our Volatile Organic Compound
(VOC) emissions annually versus the
previous year.
Achieved 64.2% reduction from 2022. We will reduce our VOC emissions annually versus
the previous year.
Maximum of 3% of hazardous waste generated at
print sites under our ownership to go to landfill.
Achieved 1.32% for 2023. Maximum of 3% of hazardous waste generated at
print sites under our ownership to go to landfill.
Biodiversity
This is a new target n/a We will carry out an internal review aiming to better
understand our impact on biodiversity.
Targets and metrics
Environmental performance data
Energy consumption and greenhouse gas
(GHG) emissions tonnes Carbon Dioxide
equivalent (tCo
2
e)
Methodology
As a large, quoted organisation, Reach plc
is required to report its UK energy use and
carbon emissions based on the Environmental
Reporting Guidelines, including mandatory
greenhouse gas emissions reporting guidance
(March 2019) issued by the then Department
for Business, Energy & Industrial Strategy (BEIS).
Reach’s methodology is consistent with the
World Resources Institute’s Greenhouse Gas
Protocol Corporate Accounting and Reporting
Standard. The data detailed in this table
represents emissions and energy use for
which Reach is responsible, including Scope 1
emissions (fuels, refrigerants, natural gas and
company car usage), Scope 2, electricity
purchased by Reach during the reporting
period, and Scope 3; all other emissions are
from Reach’s supply chain.
Our offices outside the UK are leased. These
figures are included in the Scope 3 emissions
table. We have used the main requirements
of the Greenhouse Gas Protocol Corporate
Standard to calculate our emissions, along
with the UK Government GHG Conversion
Factors for Company Reporting 2022. Data
was collected internally within Reach and
includes actual data from invoices from
our sites.
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Responsible business continued
Protecting our environment
Consumption GHG emissions (tCO
2
e)
2023 2022 2019 2023 2022 2019
UK and Offshore Scope 1
2
Gas combustion – heating (kWh) 14,161,559 14,265,096 17,359,411 2,591 2,604 3,192
Oil combustion – electricity generation (kWh) 1,364 84,331 956,029 0.35 22 242
LPG consumption (kWh) 544,026 1,376,681 333,355 125 317 71
Commercial vehicles (kWh)
3
1,248,687 1,431,149 3,149,678 294 343 788
Refrigerant gas loss (kg) 163 324 263 328 608 608
Total UK and Offshore Scope 1
4
3,338 3,894 4,901
Global (excluding UK and Offshore) Scope 1 (ROI commercial vehicles only kWh) 6,130 13,233 1 3
UK and Offshore SCOPE 2
5
Grid electricity used – location-based (kWh) 28,438,637 34,918,787 51,206,683 5,889 6,753 13,088
Grid electricity used – market-based (kWh) 28,438,637 34,918,787 51,206,683 9,816
UK and Offshore Scope 2 (market-based)
6
9,816
UK and Offshore total Scope 1 and Scope 2 (market-based)
4
3,338 3,894 14,717
Global (excluding UK) total Scope 1 and Scope 2
(market-based) 1 3
UK and Offshore Scope 1 and 2 per million pages printed
7
0.083 0.078 0.171
Global (excluding UK and Offshore) Scope 1 and 2 per million pages printed 0.00004 0.0001
Environmental performance data
Energy consumption and greenhouse gas (GHG) emissions tonnes Carbon Dioxide equivalent (tCO
2
e)
1
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Responsible business continued
Protecting our environment
Waste 2023 2022 2020
Total hazardous waste from print sites (tonnes) 1,039 1,147 1,379
Total hazardous waste from print sites to landfill (tonnes) 13.7 19 38
% hazardous waste from print sites to landfill 1.32% 1.69% 2.80%
Total weight of non-hazardous paper waste recycled (tonnes) 7,543 9,744 10,627
% non-hazardous paper waste from print sites under our
ownership recycled 100% 100% 100%
% waste electrical and electronic equipment from publishing
sites reused or recycled 100% 100% 100%
% aluminium printing plates recycled 100% 100% 100%
Water 2023 2022 2020
Total water consumption at all print and major publishing sites
(m
3
) 19,737 24,857 35,458
Volatile Organic Compounds 2023 2022 2020
Emissions of Volatile Organic Compounds (VOCs) (tonnes) 2.6 7.33 10.47
GHG emissions (tCO
2
e)
YOY%
Scope 3 emissions table 2023 2022
Scope 3
8,9
Category 1. Purchased Goods and Services
4
99,169 131,081 -24%
Category 2. Capital Goods 1,967 2,468 -20%
Category 3. Fuel and Energy
4
2,452 3,013 -19%
Category 4. Upstream Transport and Distribution
4
46,727 56,363 -17%
Category 5. Waste
4
250 305 -18%
Category 6. Business Travel 1,662 1,521 9%
Category 7. Employee Commuting 3,430 4,260 -19%
Category 8. Upstream Leased Assets 586 576 2%
Category 11. Use of Sold Products 23,694 28,190 -16%
Category 12. End of Life Treatment of Sold Products 16,342 9,241 77%
Category 15. Investments 1,645 1,253 31%
Total Scope 3 197,924 238,271 -17%
Total Scope 3 tCO
2
e per million pages printed 0.000010 0.000010 2%
1. GHG emissions and energy consumption are calculated in line with Environmental Reporting Guidelines: Including streamlined energy and carbon reporting guidance March 2019 using the UK Government’s Greenhouse gas
reporting: conversion factors 2023 (BEIS). 2022 and 2019 GHG emissions used 2022 and 2019 conversion factors from BEIS
2. Scope 1 covers the annual quantity of emissions in tonnes of carbon dioxide equivalent from emission sources that are under the operational control of Reach
3. The Commercial vehicles data in kWh has been added to the reporting table for SECR reporting
4. Scope 1 LPG has been re-stated for 2022. Scope 1 Company car emissions have been re-stated for 2022 as Reach sourced new mileage data and has retrospectively amended emissions
As a result, the Scope 3 Well-to-tank emissions for total UK Scope 1 and Scope 2 energy consumption and emissions have also been restated (these are reported on a market-based basis). Scope 3, Purchased Goods and
Services, Upstream T&D, and Waste have been re-stated for 2022 due to improvements in data quality and methodology
5. Scope 2 covers the annual quantity of emissions in tonnes of carbon dioxide equivalent resulting from the purchase of electricity by Reach for its own use
6. No global (excluding UK) Scope 2 as all UK-based operations
7. To reflect the amended totals associated with the difference in Scope 1 data, the Scope 1 intensity emissions per million pages have also been restated
8. Scope 3 covers other indirect greenhouse gas emissions for which data is currently collected, i.e. where the emissions are from sources that are not owned by Reach and where Reach does not have operational control.
Our Scope 3 records for 2022 and 2023 now represent a comprehensive and complete carbon footprint for all of our Scope 3 emissions. In line with best practice, BEIS, Internal Energy Agency (for international electricity) and
CEDA (for spend-based data) emission factors have been used. Our Scope 3 emissions follow the year 1 January to 31 December
9. Categories 9, 10, 13 and 14 are not relevant to Reach’s business
53
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PREPARING OUR BUSINESS
FOR THE CHANGING CLIMATE
There is an overwhelming body of evidence
that climate change is already causing
destruction, damage and loss of life globally.
Our industry is currently undergoing a shift
from being largely print-based to primarily
digital. Climate impacts to both print and
digital-based business remain relevant for
Reach and their management is key to ensure
the resilience of operations. Hence, we are
assessing climate impacts in the context of
these changes.
Businesses are exposed to physical climate
risks, including asset damage due to extreme
climate events, often resulting in additional
costs and delays from operational and supply
chain disruption, as well as the risks associated
with transitioning to a green economy and
more stringent policies and regulations. At
Reach, we have developed our understanding
of the most relevant risks and are working on
their management.
Taking action on climate change also presents
businesses with opportunities to ensure
sustainable growth and improve overall
resilience to future changes – and these are
particularly strong for Reach as we transition
to become a digitally-focused business.
We have made much progress in better
understanding our current and future
climate-related risks and are continuing
the work we started in 2022 to ensure that
our business remains resilient in the face of
climate uncertainty.
Summary of our work in 2023
In 2022, we carried out our initial qualitative
Climate Scenario Analysis (CSA), which
involved a desk-based study and two
stakeholder workshops. The qualitative CSA
included the analysis of risks and opportunities
using different time horizons and two climate
scenarios. We identified three key risks – one
physical (flooding that impacts directly and
indirectly on our operations), and two
transitional (carbon and energy pricing).
We also identified a key opportunity for our
business, which is our strategy to become
a more sustainable digital business.
Following our work in 2022 to identify our
most material physical and transition risks,
we quantified these risks in 2023. This has
improved our understanding of the risks,
started to identify the potential financial
implications on our business and tested
the resilience of our strategy under
multiple climate scenarios.
We also continued to calculate our full
carbon footprint, enabling us to understand
how and where we need to make changes
and investments to reduce our impact on
the climate and our exposure to emission-
related risks. Reach retains relevant records
of previous and ongoing work to support the
TCFD disclosure.
Consistency with TCFD and CFD
We began reporting voluntarily against
the recommendations of the Task Force on
Climate-related Financial Disclosures (TCFD) in
our 2021 Annual Report. This is our second year
of mandatory reporting of TCFD and our work
in this area continues to expand. Additionally,
from this year, Reach is also required to align
its climate financial disclosures with the
Companies (Strategic Report) (Climate-related
Financial Disclosure) Regulations 2022, also
known as CFD.
Following from progress made this year,
we are fully consistent with seven of TCFD’s
recommendations and partially with the other
four, as well as fully complying with all of the
CFD requirements displayed in the table on the
next page.
As a UK premium-listed company, we
report on a ‘comply or explain’ basis against
the recommendations of the TCFD. This is
consistent with the requirements of the UK’s
Financial Conduct Authority. Reach has taken
into account all of the guidance specified by
the Listing Rule 9.8.6R(8). Reach follows the
’Guidance for All Sectors’ TCFD
recommendations.
This section of the Annual Report has been
tailored to account for relevant guidance and
the table below outlines our alignment to both
TCFD and CFD.
Task Force on Climate-related Financial Disclosures (TCFD)
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TCFD recommendation CFD requirement Summary of disclosure and 2023 actions Next steps
Governance: Disclose the organisation’s governance around climate-related risks and opportunities
A. Describe the board’s oversight of
climate-related risks and opportunities
See page 57
A. A description of the company’s
governance arrangements in relation
to assessing and managing climate-related
risks and opportunities
• Board oversees climate risks and opportunities, led by the
Sustainability Committee
• In 2023 the Board and management undertook training on
climate-related issues
• Continue regular engagement and
delivery of training on climate-related
issues, risks and opportunities more
widely across the Reach team
B. Describe management’s role in
assessing and managing climate-related
risks and opportunities
See page 57
• Oversight by the ESG Steering Committee; management across
the business involved in identifying, managing and reviewing
climate-related risks and opportunities
• In 2023, we further developed senior management team roles and
responsibilities, and identified ownership for climate risks
• Continue to regularly review climate-
related risks and opportunities
with relevant risk owners and
management team
Strategy: Disclose the actual and potential impacts of climate-related risks and opportunities on the organisation’s businesses, strategy and financial planning where such information is material
A. Describe the climate-related risks and
opportunities the organisation has identified
over the short, medium and long term
See page 60 to 63
D. A description of i. the principal climate-
related risks and opportunities arising in
connection with the company’s operations,
and ii. the time periods by reference to which
those risks and opportunities are assessed
• Qualitative CSA carried out in 2022 identified our most material physical
and transition climate-related risks and opportunities under two climate
scenarios over the short, medium and long term and recognised climate
change as an emergent risk
• Risks identified will continue to be
regularly reviewed
B. Describe the impact of climate-related
risks and opportunities on the organisation’s
businesses, strategy and financial planning
See pages 60 to 63
E. A description of the actual and potential
impacts of the principal climate-related
risks and opportunities on the company’s
business model and strategy
(non-mandatory if director provides
an explanation)
• In 2023, we quantified the likely impact of each most material risk at site
and Group level, taking into account the impact in relation to strategy
and financial planning
• Further work is required to fully develop our plan to transition to a
low-carbon economy
• Continue our work to further integrate
insight on climate risks to Reach in our
strategy and financial planning
• We are working to develop and set
emission reduction targets, which will
help us develop our transition plan
F. An analysis of the resilience of the
company’s business model and strategy,
taking into consideration different climate-
related scenarios
C. Describe the resilience of the
organisation’s strategy, taking into
consideration different climate-related
scenarios, including a 2°C or lower scenario
See page 60
F. An analysis of the resilience of the
company’s business model and strategy,
taking into consideration different climate-
related scenarios
• Our CSA work considers multiple climate scenarios and time horizons
when assessing our climate risks and opportunities
• In 2023, our quantitative analysis has analysed our current operations
and strategy within different climate scenarios (including a 2°C or
lower scenario)
• In 2024: develop and implement
mitigation plans for relevant risks
TCFD report continued
Full alignment Partial alignment
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TCFD recommendation CFD requirement Summary of disclosure and 2023 actions Next steps
Risk management: Disclose how the organisation identifies, assesses and manages climate-related risks
A. Describe the organisation’s processes
for identifying and assessing climate-
related risks
See page 59
B. A description of how the company
identifies, assesses and manages
climate-related risks and opportunities
• Reach qualitatively assessed climate risks and opportunities in 2022
• In 2023, we continued that work and quantified the most material risks
• Continue to review climate-related
risks as part of our overall risk
management framework
B. Describe the organisation’s processes
for managing climate-related risks
See page 59
• Climate change is tracked in our emerging risk register, with specific
climate-related risks managed through our risk management
framework and overseen by specific risk owners
• Continue to review climate-related
risks as part of our overall risk
management framework
C. Describe how processes for identifying,
assessing and managing climate-related
risks are integrated into the organisation’s
overall risk management
See page 59
C. A description of how processes for
identifying, assessing and managing
climate-related risks are integrated
into the company’s overall risk
management process
• Material climate-related risks identified via our CSA work finalised in 2023
have been included in the business risk registers and are being tracked
by the relevant risk owners
• Continue to review climate-related
risks as part of our overall risk
management framework
• Plan to review and update our climate
scenario work in 2026 as part of a
three-year review process
Metrics and targets: Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material
A. Disclose the metrics used by the
organisation to assess climate-related risks
and opportunities in line with its strategy and
risk management process
See page 64
H. The key performance indicators used to
assess progress against targets used to
manage climate-related risks and realise
climate-related opportunities and a
description of the calculations on which
those key performance indicators are based
• Scope 1, 2 and 3 GHG emissions monitored and reported annually.
In 2023, we focused on calculating our full Scope 3 emissions
• We have further work to do to define metrics in relation to risks identified
• In 2024: identify additional metrics to
monitor each key risk and opportunity
quantified in our climate scenario
analysis work, and set near-term SBTs
B. Disclose Scope 1, 2 and, if appropriate,
Scope 3 greenhouse gas (GHG) emissions
and the related risks
See page 64
• See above
• While we monitor Scope 1, 2 and 3 emissions we do not yet explicitly
report climate risks related to Scope 1, 2 and 3
• Annual calculation of our
Scope 1, 2 and 3 emissions
C. Describe the targets used by the
organisation to manage climate-related
risks and opportunities and performance
against targets
See page 64
G. A description of the targets used by the
company to manage climate-related risks
and to realise climate-related opportunities,
and of performance against those targets
• 75% reduction of total Scope 1 and 2 GHG emissions by 2025 against
a 2019 base year
• Several other climate-/environment-related targets, e.g. for business
travel and electricity consumption
• In 2024: further work in reviewing
and setting additional targets for
the metrics identified for relevant
climate risks and opportunities
TCFD report continued
Full alignment Partial alignment
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Governance
Climate-related risks pose a potential threat
across our business but we have integrated
them into our decision-making across the
business and taken the necessary steps to
align our operations with the latest climate
science to minimise negative impacts. Overall
responsibility and oversight of climate-related
issues is at the Board level, supported by the
management team who regularly assess,
review and monitor these issues and our
approach to tackling them.
Our work in 2023 has focused on strengthening
our understanding and the role everyone
in the business plays in tackling climate-
related issues. We have extended training
opportunities more widely and launched the
new ReachSustainability network to connect
and engage people across the business. The
mission of this network is to raise the profile of
environmental, social and governance (ESG)
initiatives, provide training opportunities and
support across the business and champion
best practice around sustainability.
Board
Since our initial alignment with TCFD in 2022,
our governance structure at Board level has
not changed. The Board’s oversight of all
climate change and environmental issues is
directed by our Chief Financial Officer (CFO),
with ultimate responsibility lying with the Board
Sustainability Committee (the Committee),
which comprises all Board members. The
Committee oversees and recommends for
Board approval the Group’s responsible
business framework and related commitments,
and reviews and challenges any annual
sustainability-related targets. The Committee
is chaired by a non-executive director, Priya
Guha, and met twice in 2023 to review
progress on these issues.
Our Board Audit & Risk Committee (ARC)
is chaired by Anne Bulford and is made up
of independent non-executive directors. It is
responsible for risk management, including
climate-related risks, and reviewing the
content and accuracy of our reporting. Like the
Committee, it has been provided with regular
updates on the TCFD and quantitative CSA
work that has been conducted throughout 2023.
We have not linked executive remuneration
with climate-related issues to date. However
for the 2024 Long Term Incentive Plan, an
environmental metric regarding reductions
in Scope 1 and Scope 2 emissions will be
introduced. Read more on page 126.
Management
Management-level oversight of our climate-
related risks and opportunities is conducted by
our ESG Steering Committee. Chaired by our
CFO, the ESG Steering Committee is made up
of senior managers from across the business
and meets quarterly to review and manage
the Company’s approach to sustainability,
including climate-related issues. The ESG
Steering Committee reports to the
Sustainability Committee.
In 2023, the ESG Steering Committee
worked with an external adviser to quantify
the climate-related risks and opportunities
identified in previous qualitative CSA work.
This puts us in a position to, where needed,
develop mitigation processes and measures
against these risks while also identifying
the links between climate-related risks
and opportunities and our overall strategy
as we transition from print-based to
digitally-based products.
The TCFD Working Group, which focuses on
addressing the requirements set out by the
Task Force, has focused this year on gaps
identified in 2022. There are several teams
across the business which form the TCFD
Working Group and support the ESG Steering
Committee and its sustainability work,
particularly across risk, operations and finance.
Our risk team identifies, manages and monitors
climate-related risk, while our operations team
is responsible for monitoring of GHG emissions
and energy consumption. The operations
team has been consulted and has heavily
contributed to the analysis done to quantify
Next steps –
Governance in 2024
• Continue to promote training
opportunities more widely across the
business on climate-related issues,
risks and opportunities
• As we grow our understanding
of financial impacts, we will further
develop senior management roles and
responsibilities for how climate-related
issues are monitored and managed
TCFD report continued
climate risks. The operations team also
includes Green Teams at our print sites,
who lead environmental initiatives.
As we progress our understanding of
climate risks and their potential implications,
the finance team plays an increasing role in
identifying and managing them. For example,
the responsibility for overseeing and monitoring
the potential financial effects of climate-related
issues falls to finance.
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TCFD Governance
Board Management
TCFD report continued
Board
The Board ensures that our governance
framework is implemented through a
programme of action plans and
annual targets.
This year the Board has undertaken
training on climate-related issues.
TCFD Working Group
The TCFD Working Group is made up
of colleagues from Group Finance,
Risk and Audit, Company Secretariat
and Central Services.
Sustainability Committee
The Sustainability Committee is
made up of all Board directors.
It has responsibility to review,
challenge, oversee and
recommend for approval the
Group’s responsible business
framework and related
commitments; review and
challenge annual sustainability-
related targets; and review
and oversee the Group’s
sustainability reporting.
Environmental, Social and
Governance Steering
Committee
The ESG Steering Committee is
chaired by the Chief Financial
Officer and is attended by various
senior managers across the
business. The Committee is
responsible for ensuring that
all climate change and
environmental targets
and legislation are met.
Audit & Risk Committee
The Audit & Risk Committee
is responsible for scrutinising
climate-related and financial
reporting, and for monitoring
our risks.
Executive
management team
The executive management
team supports the Sustainability
Committee by attending each
meeting as required.
Key Direction and oversight Reporting Advice
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Risk management
Reach’s process to identify and assess
climate-related risks began in 2022 as part
of the qualitative Climate Scenario Analysis
(CSA). In 2023, we continued this work by
conducting a quantitative CSA. The risks
considered in the quantitative assessment
are those that had been identified in 2022
by the Board and the senior management
team as most material and relevant to Reach.
These are:
• energy pricing;
• carbon pricing; and
• increased flooding.
This work involved engaging with a range
of internal stakeholders (including senior
management, risk operations and finance)
through a series of questionnaires and
workshops to discuss and gather insight
on our level of preparedness to cope with
the different risks. It also involved collecting
and analysing the external climate modelling
data needed to comprehensively assess
our exposure to these risks. We used the risk
framework developed this year to assess all
risks; this supports the integration of climate
risks in the overall assessment and comparison
of different risks. Our risk team is responsible
for the risk management framework, including
climate-related risks. You can read more
details on our approach to CSA in the
Strategy section.
As part of our ongoing work on climate
issues, and in addition to our quantitative CSA
work, we have reviewed the potential overall
implications of current and proposed climate
regulation. As a result, climate change remains
a general emerging risk. The emerging risk
and the individual most material climate
risks assessed are therefore monitored by
our senior leadership team through our risk
management framework, which includes
regularly reviewing the relevance and severity
of external pressures and the environment
within which we are operating. Our work to
improve our risk management processes,
which included further work to understand
more fully the emerging risk of climate
change, has also led to a better embedding
of this emerging risk into our risk management
model; see our risk management process on
page 66 for more on how we manage risk
in general.
Strategy
A key focus for our business strategy at Reach
is to transition away from predominantly
paper-based products towards a digitally-
based platform. We identified in our CSA
work last year that there are climate-related
physical and transition risks relevant to Reach
that are likely to impact our current business
model and our strategy, as well as several
opportunities associated with the transition
to a low-carbon economy. To prepare for
these challenges and opportunities, we have
progressed our CSA work and quantified the
potential impacts of the main climate risks
on our business.
The approach taken in the quantitative CSA
assessment is formed of three parts: exposure
(analysis of how the climate and related
drivers are projected to change); vulnerability
(sensitivity and level of preparedness to a
climate hazard); and risk (combining exposure
and vulnerability results to calculate overall risk).
Exposure modelling – how individual sites/the
business are exposed to each hazard under
different time horizons and global climate
scenarios (a low-carbon scenario of 1.5-2°C
and high-carbon scenario of 4°C) as well as
different business scenarios. The exposure
modelling was informed by climate modelling
data from several sources, including regional
climate models, International Energy Agency
(IEA) projections and EnerFuture data.
Exposure was then analysed and categorised
considering the likelihood of a climate-related
event (e.g. a flood or a carbon price) occurring
in a given climate scenario and time horizon.
Likelihood ratings were assigned based on
existing definitions within Reach’s risk framework.
Vulnerability assessments – how sensitive
the site/business is to a hazard and if there
are any measures in place to reduce the risk.
As part of the vulnerability assessment, print
and office site managers as well as relevant
business units completed a questionnaire that
enabled us to understand how sensitive each
site is to the risks analysed. Vulnerability ratings
were assigned based on definitions within
Reach’s risk framework.
Risk calculation – the vulnerability and
exposure ratings were combined for each site
and risk to obtain a risk score (using Reach’s
risk framework as a reference). Impact in
Reach’s risk framework is analysed based
on financial, strategic (including reputation),
operational and compliance considerations.
Given the risks analysed quantitatively as part
of the CSA work in 2023, focus has been given
to financial impacts. However, considerations
of strategic impacts have also been taken into
account. The description of financial impact in
the risk framework has been applied to assess
the potential magnitude of the impact for
each risk. Read more about our risk
framework on page 66.
The outputs of the quantitative CSA work are
being integrated into Reach’s existing risk
register and framework.
Next steps
We are working to develop a process to
review all identified climate-related risks
and reassess their relevance to Reach
every three years. As the initial qualitative
CSA was carried out in 2022, with the
quantitative CSA in 2023, the next CSA
assessment will be in 2026. Between now
and then we will continuously monitor
the most material climate-related risks
that have been identified (as described
in the Risk management section).
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We conducted desk-based research across a
range of the latest climate science published
by international and national organisations.
This gave us an overview of the latest climate
projections across different possible scenarios
and, based on the scenarios envisaged by
these organisations in their research, we
considered two when identifying and assessing
our risks. These scenarios lie at opposite ends
of the spectrum, which enables us to gain
an understanding of the range of potential
climate-related risks and opportunities
relevant to Reach. These scenarios are
potential pathways, rather than projections,
and either are possible.
The scenarios we have looked at:
• Low-carbon scenario: this ‘net zero by 2050’
scenario assumes that we achieve the goal
of the Paris Agreement, namely that the
global temperature rise is limited to 1.5°C
above pre-industrial levels. In this scenario,
the most likely risks are those associated
with the transition to a lower-carbon
economy, namely higher emission costs,
while physical risks will be lower than in
a high-carbon scenario. For energy and
carbon pricing risks, data from two specific
low-carbon scenarios developed by IEA
were used, i.e. Maximum Ambition (leading
to net zero by 2050) and Enhanced Ambition
(assumes national targets and
commitments are achieved).
• High-carbon scenario: this ‘business-as-
usual’ scenario assumes that climate policies
and other actions taken are insufficient to
achieve the goals of the Paris Agreement
and transition to a low-carbon economy,
and so global temperatures rise to 4°C
above pre-industrial levels. In this scenario,
we expect to see severe physical risks.
The time horizons we have considered:
Near: now to 2030
Medium: 2030 to 2050
Long: beyond 2050
These time horizons align with national climate
targets (for example, the UK’s commitment to
net zero by 2050), potential key target years
for Reach in relation to climate actions, time
horizons where climate drivers are likely to
materialise, and, as far as practical, with
the timeframes used in relevant climate
science publications.
It’s important to note that there are inherent
uncertainties in any climate model outputs for
a specific scenario, given how much depends
on variables such as the speed of the energy
transition, the introduction (or not) of climate-
related policies by governments across the
world, and how quickly the climate changes in
response. Nonetheless, the analysis allows us
to understand the potential consequences
and plan accordingly.
The results of our quantitative CSA work
are summarised for each risk identified in the
table below. Overall, carbon pricing has been
identified as the most relevant risk for Reach.
However, when considering Reach’s strategy
to transition away from paper-based products,
carbon pricing should not represent a
significant financial risk to Reach. In the short
term, Reach could face some risk (moderate
when considering Reach’s risk framework)
from paper consumption, with paper
manufacturers facing higher carbon prices
and passing some of their costs on to Reach,
but carbon prices for paper manufacturers are
currently low or non-existent. As Reach moves
away from print, the risk of facing carbon costs
from paper manufacturers or suppliers of
freight services will fall sharply.
Our quantitative CSA work this year found
that energy pricing should not represent
a significant financial risk to Reach when
considering scenarios including Reach’s
planned actions. Flooding does not present
a significant risk to most of our offices directly,
and although flooding of the surrounding area
is expected for most offices in the future, the
impact is expected to be minimal in most
cases, taking into account existing measures
to continue operations during these events.
Our print sites are not projected to be directly
exposed to flooding under current or future
scenarios, though there is a possible indirect
exposure risk, e.g. the electricity substation
serving one of our print sites is exposed to
surface and river flooding in current and future
climate scenarios. Overall, the future risk of
flooding is considered to be low to moderate
and its financial impacts to be minimal.
The analysis of risks in the near and medium
term under two global climate scenarios has
shown that our current business model and
our strategy are resilient to these main climate
impacts. In fact, our strategy aligns with the
climate actions needed to decrease exposure
to certain transition risks.
Our qualitative CSA work in 2022 showed
that climate change also presents several
opportunities, particularly in a scenario where
we transition to a low-carbon economy.
We used the same approach as with risks
to identify and assess opportunities and to
identify the most significant opportunities
for our business. Our key opportunity, in both
scenarios and across all time horizons, is the
transition from print to digital that is already
under way as we deliver our strategy. This year,
as part of the analysis of carbon and energy
prices, we have identified scenarios that
reduce potential costs. For example, in a
low-carbon scenario, our energy costs would
be lower than current costs in the short and
medium term.
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Table of summary of quantitative CSA work for each risk
FLOODING
Risk description Most relevant climate scenario and time horizon Likelihood rating and description Impact rating and description Overall risk Mitigation actions
Context
Flooding is the major physical
climate-related risk in the UK and
under climate change conditions
it is expected to increase both in
intensity and frequency (projections
show that intense rainfall and flash
flooding could become almost five
times more likely by the end of the
century). Based on findings from the
latest UK Climate Risk Assessment,
in a 4°C scenario damages to
businesses could increase by
around 44% by 2050 and 75%
by 2080.
Reach has offices and print sites in
more than 15 locations across the UK
and Ireland. The level of flood risk
(including surface, river and coastal
flood risk) varies depending on the
site, its location and the systems it
depends on. The direct and indirect
impacts of extreme weather events
were identified as the main physical
risk to Reach. Indirect impacts might
be of most relevance as downtime
in the energy system and blocked
access to sites can cause disruption
to operations.
Risk category: Physical, Acute
Link to existing principal risk:
Supply chain disruption
High carbon and medium term
(to 2050s)
Both low and high-carbon scenarios as
well as near, medium and long term have
been included in the analysis of flood risk.
The most relevant scenario is the high-
carbon scenario (analysed using climate
modelling output from RCP8.5) and the
time horizon at which the increase in the
risk might be significant compared to the
baseline period is the 2050s.
Rating:
This varies depending on the
site but overall it has been
categorised as very unlikely
direct exposure to flood but
possible indirect exposure.
Description:
We have analysed flood
exposure at each individual
site using a range of free and
at-cost datasets, representing
the best flood models available
to assess current and future
flood exposure. For the most
relevant time horizon and
scenario, we have identified two
locations which in the future are
expected to be directly exposed
to flooding (but the vulnerability
of these sites was categorised
as low and hence not at
considerable risk). In addition,
projections show that a number
of sites are expected to be
indirectly exposed to flooding
(i.e. site not expected to flood
but surrounding areas
might flood).
Rating:
The potential impact of a flood
varies per site but overall it has
been categorised as being low
for office sites and major for
print sites.
Description:
A set of vulnerability
considerations were
assessed at site and Group
level to determine the state
of preparedness for flooding.
If a flood event was to occur
at an office site, the level of
impact was categorised as
low as there is generally no
critical equipment that could
get damaged, and employees
have the ability to work from
home. Hence, the overall
impact on operations would be
minimal. At print sites, assuming
a flood event occurs, the
impact was categorised as
major given the potential
damage to material and
equipment and impact on
operations if the energy
system was impacted.
Rating:
Overall categorised as low/
moderate (ranging between
low to moderate depending
on the site). Financial impact
expected to be minimal in a
future climate scenario and
considering Reach’s strategy
and measures in place.
Description:
Risk per site was estimated
by combining information
on likelihood and impact.
While the risk varies per site, the
overall risk to Reach has been
categorised as low/moderate,
given the mitigation measures
available and the existing
insurance to cover damages. In
addition, given Reach’s strategy
to become a digitally-focused
business, flood risk to print sites
would decrease as the strategy
is implemented.
• Existing working from home
policy for office-based
workers if offices are
inaccessible.
• Existing warning system to
inform employees in the
case that working from
an office is not possible.
• In specific sites, elevation of
water-sensitive materials
and equipment to above
ground-level.
• Back-up power generators
at print sites.
• Contingency plans for print
sites (shifting printing load
between sites).
• Planned move to digital and
reduce reliance on printing.
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TCFD report continued
CARBON PRICING
Risk description Most relevant climate scenario and time horizon Likelihood rating and description Impact rating and description Overall risk Mitigation actions
Context
Carbon pricing represents a major
climate-related risk in the UK, primarily
due to the UK Emissions Trading Scheme
(UK ETS) that puts a price on emissions
from certain sectors. As of November
2023, the price per tonne of CO
2
e under
the UK ETS is approximately £40. There
are also carbon prices impacting Reach’s
upstream supply chain partners in
countries in the EU and North America,
and the prevalence of these mechanisms
is growing.
Firms can either face direct or indirect
carbon pricing risk. Direct carbon prices
usually cover large facilities in emissions-
intensive industries, such as electricity
generation and manufacturing. Directly
regulated firms will probably pass their
carbon costs through to their consumers.
Most companies will face indirect risk
from carbon costs passed through
from emissions-intensive suppliers.
Depending on how carbon price
mechanisms evolve, Reach could face
risk from consumption of electricity,
natural gas, diesel, paper and road
freight services. In all such cases, carbon
costs would be passed through to Reach
from the suppliers of these services,
themselves directly subject to a carbon
tax or emissions trading scheme.
Risk category: Transition, Policy and Legal
Link to existing principal risk:
Supply chain disruption, Deceleration
of digital growth.
Low carbon and near term
(up to 2030)
The low-carbon scenario (in enhanced
and maximum ambition) is the one in
which carbon prices increase to the
highest levels. In the near term, Reach’s
direct and supply chain emissions will be
highest as paper products and print sites
remain critical for Reach’s operations.
Consequently, assuming emissions
continue to fall over time, risk will increase
in the short term and peak around 2030.
Rating:
While Reach will not face
direct exposure to carbon
pricing, it is likely to face
exposure to carbon prices
due to costs passed through
from suppliers. The likelihood
has therefore been
categorised as probable.
Description:
Reach sources paper
from several countries that
already have carbon prices
in place (such as the UK, EU
and Canada). Reach is likely
already facing some impacts
due to carbon prices faced
by paper manufacturers.
Reach is also likely already
facing impacts from carbon
prices faced by electricity
suppliers in the UK. In a
low-carbon scenario,
carbon prices in these
regions are expected to
increase considerably in
the near and medium term.
Rating:
Potential impact is moderate,
based on carbon pricing
trends and Reach’s planned
digitalisation actions.
Description:
Reach is transitioning away
from paper products and
will eventually become an
office-based supplier of
digital products. Such
companies are not at
major risk from carbon
pricing unless they have
exceptionally high on-site
energy consumption.
Reach’s greatest source
of risk will be from carbon
costs passed through from
electricity suppliers. If the
UK ETS expands, Reach may
also face significant risk
due to on-site natural
gas consumption and
any remaining road
freight services.
Rating:
Overall risk is categorised
as moderate.
Description:
Assuming a low-carbon
scenario (enhanced ambition)
and currently planned actions,
carbon pricing could represent a
moderate financial risk to Reach.
Even if Reach is not directly
regulated by a carbon price, it
could face some short-term risk
from paper consumption due to
its suppliers passing carbon costs
through. Carbon cost exposure
for most paper manufacturers is
currently low or non-existent but
that is projected to increase in the
future in a low-carbon scenario.
As Reach moves away from print,
the risk of facing carbon costs from
paper manufacturers or suppliers
of freight services is expected to
fall sharply. Reach will soon be
largely built around grid-based
electricity consumption and
cloud-based data storage. While
fossil-fuelled electricity production
can be regulated by carbon
pricing, the Company’s on-site
electricity consumption is unlikely
to be at a level that would cause
carbon pricing to be a major
concern. This is especially so
because the UK power grid is
expected to continue along a
strong decarbonisation trajectory.
• Digitalisation
could reduce energy
consumption from direct
operations, therefore
reducing exposure
to both carbon and
energy pricing.
• Installation of on-site
solar power will reduce
exposure to both carbon
and energy pricing.
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TCFD report continued
ENERGY PRICING
Risk description Most relevant climate scenario and time horizon Likelihood rating and description Impact rating and description Overall risk Mitigation actions
Context
Energy pricing represents a major
climate-related transition risk for
energy-intensive organisations in
the UK.
Under certain scenarios, electricity
and natural gas prices could rise
sharply in response to policies
intended to disincentivise energy
consumption and CO
2
emissions.
Energy-intensive companies
expecting to increase their
emissions will be most at risk.
Reach is not currently energy-
intensive, and emissions are not
expected to increase based on
current digitalisation plans.
Risk category: Transition, Market
Link to existing principal risk:
Deterioration in macroeconomic
conditions (inflation).
Low carbon and near term (up to 2030)
The low-carbon scenario is the one in
which natural gas prices increase to the
highest levels, while electricity prices are
expected to rise before falling. In the near
term, Reach’s energy consumption will
be highest as paper products and print
sites have not yet been phased out.
Consequently, assuming emissions
continue to fall over time, risk will increase
in the short term and peak around 2030.
Rating:
Reach will probably face
some increases in the price of
electricity and natural gas over
time. Likelihood has therefore
been categorised as probable.
Description:
As the global climate policy
continues, the UK Government
may enact other policies
intended to increase the price
of electricity and natural gas.
For example, the UK carbon
price is expected to rise and
could increase gas production
and distribution costs.
Rating:
The potential impact of
changing energy prices on
Reach is categorised as low.
Description:
Despite the potential for
increased energy prices,
Reach’s energy cost is likely
to fall. There are no planned
actions that would lead to
a significant increase in
Reach’s energy consumption.
Meanwhile, consumption may
shift away from paper-based
products to digital, therefore
reducing the energy consumed
in Reach’s direct operations.
Rating:
Overall risk is categorised as
low and, when considering
Reach’s planned actions, the
increase in energy prices is
not a risk.
Description:
Energy pricing should not
represent a financial risk
to Reach if, following the
current trajectory, there is a
reduction in energy consumed
in direct operations. Electricity
consumption in offices is
unlikely to be at a level that
makes energy prices a concern.
Reach could face increased
natural gas costs if prices
increase significantly in
response to policy actions to
restrict supply and otherwise
raise production costs.
However, natural gas is mainly
used at Reach print sites,
and the Company expects
to transition away from print
and towards digital products.
Reach is already taking steps to
reduce this risk further with the
installation of on-site solar
power generation.
• Digitalisation could reduce
energy consumption from
direct operations, therefore
reducing exposure to both
carbon and energy pricing.
• Installation of on-site solar
power will reduce exposure
to both carbon and
energy pricing.
Next steps – 2024:
• Continue to review the risks identified regularly
• Continue to monitor external factors and pressures on the business and how these interact with the identified risks/opportunities
• Continue our work to further integrate insight on climate risks to Reach in our strategy and financial planning
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Metrics and targets
The metrics and targets we have in place play
an important role in enabling us to measure
and monitor our climate-related risks and
opportunities. The work we have done in 2023
to quantify climate risks and opportunities will
enable us to set more specific metrics and
targets to further measure and monitor
risks, which is the next key step we must
take to align with climate financial
disclosure recommendations.
We report fully on our Scope 1, 2 and selected
Scope 3 emissions annually, which has been
a major driver in helping us to understand the
impact we are having on the climate as well
as how we might in turn be affected by risks
associated with our emissions throughout
our value chain. In 2023, we completed the
calculation of all relevant Scope 3 categories
(page 53), which enables us to identify high
emissions sources and act to reduce them.
Our existing climate-related targets include a
75% reduction of our Scope 1 and 2 emissions
by 2025 (against a 2019 baseline), which will
not only help us to reduce our environmental
impact but also reduce our vulnerability to any
potential costs associated with carbon pricing.
NEXT STEPS – 2024:
• Continue the work on setting targets
and metrics for the most relevant
risks and opportunities following
our quantitative CSA work.
We regularly review all sustainability targets to
ensure they are in line with our goals for the
Company. We continue to set ambitious
emission reductions targets in line with
the Paris Agreement.
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Policies and guidelines In summary More information
Focus area: Environment
Environmental Policy Specific commitments in relation to the main areas
where the Company has the potential to cause
environmental impacts
Compliance with required Climate-related
Financial Disclosures
Pages 46 to 53
Pages 54 to 64 for
the TCFD report
Pages 55 and 56
Focus area: Employees
Dealing and
Disclosure Policy
Compliance by employees with insider and
share-dealing regulations
Internal only
Inside Information
Policy
Clear and documented procedures for handling and
disclosing inside information
Internal only
Dealing Code for
Directors and PDMRs
Compliance by directors and persons discharging
managerial responsibilities (PDMRs) with
insider-dealing regulations
Internal only
Diversity &
Inclusion Policy
Understanding the Group’s approach to diversity
and inclusion, the role all our people play in fostering an
inclusive culture, why it matters and where to find help
Pages 41 to 44
Health & Safety
Policy Statement
Understanding the Group’s commitment to the health
and safety of its employees and others affected by its
business activities
Page 39
Disclosure Policy Awareness of how to make a disclosure of
suspected wrongdoing
Page 38
Focus area: Human rights
Anti-slavery Policy Compliance with modern slavery regulations under the
Modern Slavery Act 2015
Page 38
This table summarises our policies and sets out where you can find the information required to meet the non-financial reporting requirements under sections 414CA and 414CB of the Companies Act 2006.
Non-financial and sustainability information statement
Policies and guidelines In summary More information
Focus area: Anti-bribery and anti-corruption
Anti-bribery Policy Compliance with applicable anti-bribery and
anti-corruption laws
Page 38
Anti-fraud Policy Clear and documented procedures on reporting
suspected fraud and how the Group will respond to
a concern about fraud
Internal only
Standards of
Business Conduct
Maintaining high standards of integrity and
personal conduct
www.reachplc.com
Focus area: Social matters
Code of Conduct
Policy
Understanding the professional conduct that the Group
expects everyone to abide by, to create a culture that all
employees are proud to be a part of
Page 38
Group Procurement
Policy
Understanding the Group’s policy and procedures for the
procurement of goods and services
Internal only
Data Protection Policy Compliance with the UK General Data Protection Regulations
(UK GDPR) and the UK Data Protection Act 2018, the Irish Data
Protection Acts, and data protection laws and regulations in
all jurisdictions in which we operate
Pages 37 and 38
www.reachplc.com
Focus area: Non-financial key performance indicators
Understanding the key metrics in measuring the Group’s
non-financial performance
Pages 20 and 21
Focus area: Management of principal risks and uncertainties
Understanding the key risks that the Group faces Pages 68 to 72
Focus area: Business model
Understanding how value is created for stakeholders Pages 16 and 17
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Risk report
During the year, we have continued to see the
internal and external environment evolve and,
as a result, we have seen the risk environment
evolve and change too. We have continued
to progress and embed our Customer Value
Strategy (CVS) to create a more data-led
digital business. Macroeconomic conditions
continue to be challenging, particularly in the
areas of inflation and consumer confidence,
interest rates, and advertising spend. We have
seen an accelerated decline in digital referral
volumes driven by the evolution of referral
approaches used by the different platforms.
All of these areas affect our risk environment
and underline the importance of managing
risk and uncertainty effectively in order to
ensure the successful delivery of our CVS.
We have focused on our principal risks, with
further work undertaken in the year to evolve
how we mitigate and manage our principal
risks, taking accelerated action where required
to respond to the evolving internal and external
environment. We have also completed deep
dive reviews with the Audit & Risk Committee
for several of our principal risks. These included
cyber security, data protection, brand
reputation, treasury management and future
funding, and US operations risk. We have
continued to develop a better understanding
of our emerging risks and opportunities of
climate change and AI throughout the year.
In line with the recommendations of the Task
Force on Climate-related Financial Disclosures
(TCFD), we have identified our top climate
risks and opportunities and completed further
analysis to understand these more fully and
embed them into our risk management
model, as set out on pages 61 to 63.
How we manage risk
Our risk appetite has been clearly defined
and agreed by the Board and helps us to drive
decision-making when determining how we
best manage each of our principal risks.
We carefully evaluate the level of risk we are
prepared to take, and our risk appetite in
relation to strategic, operational and
regulatory risks is as follows:
Strategic
In pursuing our strategy, the risks we take
carefully balance the need to develop the
business with not knowingly compromising our
existing brands, our reputation or our financial
stability. Our principal strategic risks are:
• deterioration in macroeconomic
conditions; and
• deceleration of digital growth alongside
acceleration of decline in print revenue.
Operational
Our appetite for risks that may lead to
significant disruption of our operations is low.
We seek to minimise risks from unforeseen
operational failures in both our business and
our service providers. Our principal operational
risks are:
• cyber security breach;
• supply chain disruption;
• health and safety incident;
• lack of funding capability;
• inability to recruit and retain talent; and
• damage to brand reputation.
Regulatory
We have no appetite for any risk that may
constitute a breach of regulations, although
we will challenge the appropriate bodies
where we feel regulations are strategically
limiting. Should mistakes occur, we act
promptly to resolve the issue and prevent
it happening again. Our principal regulatory
risk is data protection failure.
Risk management framework
Identifying and evaluating risks
We regularly identify, evaluate and monitor all
risks including emerging risks that may affect
the operation of each area of our business. We
then identify, evaluate and monitor those risks
we consider to be principal – i.e. those with the
greatest potential to have a negative impact
on the business.
Managing risks
Having identified and evaluated our principal
risks, we consider how best to mitigate and
manage their potential impacts. We have
clearly defined roles, responsibilities and
accountabilities for managing our risks as
set out in the diagram opposite. Each of our
principal risks has an Executive Committee
owner and we have well-established
processes in place to allow the Board to
review these risks. These are detailed in
our Governance Report.
AN OVERVIEW OF OUR
RISKS IN 2023
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Risk report continued
Our roles, responsibilities and accountabilities
The key roles and responsibilities in risk management are set out below:
Executive Committee
• Owns the day-to-day operation of the risk management framework
and systems of internal control
• Identifies and assesses risks and introduces mitigation controls
• Establishes ongoing processes to monitor and manage risk,
including emerging risks
• Assesses the effectiveness of internal controls and addresses
any issues identified
• Ensures significant issues are escalated promptly to the Board
• Ensures that decisions taken are in line with the corporate
risk appetite
• Ensures onward communication of key Group policies
and procedures
Board
• Sets strategic objectives
• Identifies, evaluates and monitors principal risks and uncertainties
• Sets the ‘tone from the top’ and establishes the corporate risk appetite
• Reviews and approves key Group policies and procedures to manage risk
• Responsible for the assessment of risk (delegated to the Audit & Risk Committee)
Audit & Risk Committee
• Reviews the effectiveness of the risk
management framework and internal
control systems
• Reviews effectiveness and integrity of
financial reporting
• Oversees risk-based internal audit
activity which provides independent
assurance over the operation of the
Group’s internal control systems and
risk management processes
• Monitors compliance with the
corporate risk appetite
Operational functions
• Ensure appropriate risk management is in place
within their business areas
• Review risks and mitigations on a regular basis
• Review and monitor the implementation of key Group policies
and procedures
• Identify emerging risks, and where appropriate escalate to the
Executive Committee
Risk and compliance support functions
• Support and advise management in managing risk
• Support and advise the business on the development of
appropriate and proportionate risk management actions
• Co-ordinate risk identification, reporting and governance activity
• Provide an opinion on the effectiveness of internal control and risk
management systems and processes
Key Direction and oversight Reporting Advice
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Risk report continued
Our principal risks
and uncertainties
We have considered our risks in the context
of delivering our strategy through a more
data-led digital business and the evolving
external environment. The evolving external
environment has seen the macroeconomic
conditions continue to be challenging,
particularly in the areas of inflation and
consumer confidence, interest rates, and
advertising spend. We have seen an
accelerated decline in digital referral volumes
driven by the evolution of referral approaches
used by the different platforms.
This has caused our risk of digital growth
deceleration to increase and our risks
around deterioration in the macroeconomic
environment, supply chain disruption and
cyber security breach to remain elevated
throughout the year. The risk environment
for data protection failure has also changed
during the year with our expansion into the US.
We have reviewed and evolved our mitigating
actions for our principal risks to ensure they
adapted to the changing risk environment.
The Board has undertaken a robust risk
assessment and review of our principal risks
in this context and the Audit & Risk Committee
has also performed a deep-dive review of the
following principal risks during the year: cyber
security, data protection, brand reputation,
treasury management and future funding,
and US operations risk. Our principal risks and
progress against them are set out below.
We have continued to develop a better
understanding of our emerging risks of climate
change throughout the year. Whilst we do not
at this stage consider climate risk to be a
principal risk, in line with the recommendations
of the Task Force on Climate-related Financial
Disclosures (TCFD) we have identified our top
climate risks and opportunities and completed
further analysis to understand these more fully
and embed them into our risk management
model, as set out on pages 61 to 63.
Risk and description How we mitigate the risk What we’ve done this year
Strategic
Deterioration in macroeconomic conditions
Risk owner: Full Executive Committee
Continued deterioration in macroeconomic conditions
could result in an uncertain trading environment with
reduced customer and advertiser spending, higher
interest rates, higher inflation and increased costs,
leading to lower cash flow and profits.
The economic uncertainty continues. We closely monitor the
risk and impact and continue to take action when needed.
We have a proven track record of responding quickly and
delivering additional cost savings as necessary when faced
with unexpected revenue declines.
We have closely monitored and assessed the macroeconomic
factors and during the year we have seen continued
inflationary pressures and increasing interest rates. We have
continued to take action to closely monitor costs and be as
efficient as possible, taking timely actions to mitigate inflation
cost pressures in the year.
Key
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Risk report continued
Risk and description How we mitigate the risk What we’ve done this year
Deceleration of digital growth alongside
acceleration in decline of print revenues
Risk owner: Full Executive Committee
Changes in the traditional publishing industry have led
to an ongoing decline in print advertising and circulation
revenues, which is being exacerbated by macroeconomic
factors. A lack of appropriate strategic focus could result in
us losing further revenue from existing products, while also
failing to grow digital revenues quickly enough to offset the
decline in print.
Our strategic development is led by an experienced Board and
Executive Committee.
We focus on developing digital revenue streams through
the CVS.
We continue to take tactical measures to minimise print
revenue declines and maintain profits, such as taking
appropriate cost mitigation or pricing measures.
We have governance structures which enable the ongoing
review of performance against targets and strategic goals,
including a weekly structured trading meeting.
We keep under consideration acquisition, joint venture and other
corporate development opportunities, which are aligned to
our CVS.
Our strategy, led by an experienced Executive Committee, is built
around moving to a digital-led model and remains the key
strategic focus for the Executive Committee.
During the year we have focused on building our direct
relationships with customers; social video content; our strategy
for affiliates; and Curiously, which aims to grow revenue from
new audiences.
Specifically, we have launched the Secure Audience Strategy,
which focuses newsrooms on increasing the number of page
views which come from reliable sources – those built on
intentional relationships with us by readers.
Content is analysed by age profile to understand what will
appeal to under-35s in particular. This was rolled out in August,
as part of the wider cultural change Curiously is tasked
with delivering.
We have also launched an operation in the US, which gives us
another route to a digital population of 360m people, which in
turn will open up new revenue opportunities.
Operational
Cyber security breach
Risk owner: Chief Financial Officer/Chief Information Officer
An internal or external cyber threat or attack, or a breach
within one of our suppliers, could lead to breaches of
confidential data, interruption to our systems and
services, reputational damage with our stakeholders
and financial loss.
All business-critical systems are well established and are
supported by appropriate disaster recovery plans.
We regularly assess our vulnerability to cyber attack and our
ability to re-establish operations in the event of a failure.
The technical infrastructure supporting our websites is within the
cloud and our sites have been designed to provide adequate
resilience and continued performance in the event of a
significant failure.
We continue to invest in enhancing our cyber security
infrastructure as new threats emerge.
Given our continued strategic focus on customer data as a
source of revenue, the potential impact of a cyber security
breach is increasing all the time. During the year we continued
to deliver our cyber security improvement programme and
have focused on the preparedness of our technology leaders
to manage cyber incidents including cyber incident training
and table-top exercises to rehearse re-establishing operations
in the event of a failure. We have continued to harden our
cloud environments to contain the damage from a potential
cyber attack and performed regular penetration tests to
identify vulnerabilities.
Key
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Risk and description How we mitigate the risk What we’ve done this year
Supply chain disruption
Risk owner: Chief Operating Officer/Chief Financial Officer
Disruption or failure in our supply chain could lead to
business disruption, increased costs, reduced service and
product quality, and ultimately mean we are unable to
deliver our strategy.
Print: Our print products, which rely on a small number of
key suppliers (for example, newsprint suppliers, wholesalers
and distributors), could be adversely affected, operationally
and financially, by changes to supplier dynamics.
Information systems and technology: A major failure,
breach or prolonged performance issues at a third-party
provider could have an adverse impact on our business.
We carefully monitor and manage all our third-party print and
information systems and technology providers – these include:
• Ad producers and planners
• Wholesalers and distributors
• Newsprint suppliers
• Manufacturing maintenance and parts providers
• IT providers
• Global digital partners
We have business continuity/disaster recovery plans in place with all
our key partners.
For our IT partners, we have clear governance arrangements covering
risk management, change control, security and service delivery.
During the year we continued to monitor our key
suppliers, with a particular focus on suppliers to our
print site operations.
We also continued to review our contingency
arrangements to ensure we have robust stock
management processes and that there are contingency
arrangements in place with our key suppliers.
Health and safety incident
Risk owner: Chief Operating Officer
Failure to adhere to our health and safety systems could
result in our employees or other workers on our sites
having accidents, including, potentially, fatal ones.
Every site has a professionally qualified and experienced health and
safety manager and an occupational health provider. The health and
safety manager oversees the implementation of our health and safety
management system, which includes an adverse event reporting
system. This allows investigations to be carried out in a timely manner
by the health and safety team.
The system includes a process for assessing risks in different areas of
the business and covers risks such as external work in hostile and
high-risk environments.
It also includes internal and external auditing to ensure continuing
compliance across our print and publishing sites.
We offer health and wellbeing support, including for mental health, to
all our employees.
During the year we have worked to embed the
refreshed Health and Safety Policy and framework
that was implemented in 2022.
We have continued to enhance our risk
assessment processes for events, our hubs and
work in high-risk environments.
We have continued to offer appropriate health
and wellbeing support to all of our employees. Online
threats and abuse towards our journalists is an area
of increasing concern, so addressing this issue and
protecting our journalists will continue to be a priority
for us.
Key
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Risk report continued
Risk and description How we mitigate the risk What we’ve done this year
Lack of funding capability
Risk owner: Chief Financial Officer
Our main financial risk is the lack of funding capability
to meet business needs. This may be caused by a lack of
working capital, unexpected increases in interest rates or
increased liabilities, in particular:
• pension deficits may grow at such a rate that annual
funding costs consume a disproportionate level of profit
• volume and level of claims for historical legal issues (HLI)
Financing
We have committed loan facilities sufficient to deliver
our strategy.
Through regular dialogue, we maintain constructive
relationships with our syndicate banks.
We forecast and monitor cash flow regularly through our
treasury reporting processes.
Our exposure to foreign exchange fluctuation is limited.
Commitments
Regular reporting to the Board (including facility utilisation
and covenant compliance).
We hold regular discussions with pension scheme trustees.
We continually review ways of de-risking our pension liabilities.
We continually monitor and manage ongoing HLI claim levels,
and work with external lawyers on HLI civil claims.
Financing
Following the extension of our full loan facility for an additional
year during 2022 (until November 2026) to mitigate the risk of
any unexpected increases in interest rates or liabilities, no
changes to the facility have been made during 2023.
Commitments
We made significant payments to our pension schemes in the
year and we remain committed to addressing our historical
pension deficits. This includes the successful resolution of the
2019 triennial review during the year for the one remaining
scheme. Discussions are ongoing with the Group’s other
schemes regarding the 2022 triennial valuations and are
expected to be concluded satisfactorily by the 31 March 2024
due date.
In December, the High Court’s judgement on time limitation
provided a clearer view on our future liabilities in relation to HLI.
Inability to recruit and retain talent
Risk owner: Group Human Resources Director
The inability to recruit, develop and retain talent with
appropriate skills, knowledge and experience would
compromise our ability to deliver our strategy.
We continually monitor and review:
• Digital capabilities of our workforce
• Turnover levels
• Pay and benefits
• Opportunities to expand our talent pool
(for example, outside London)
• The recruitment channels we use
• Diversity and inclusion
Against the backdrop of this year having a recruitment freeze
we have been continuing to monitor this risk while taking into
account the current business environment. We are currently
downsizing our workforce. Throughout this exercise, we ensured
that we retained skills and talent. Against this backdrop and
the changing business environment we are closely reviewing
our employee proposition in order to retain the best talent
going forward.
Key
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Risk report continued
Risk and description How we mitigate the risk What we’ve done this year
Damage to brand reputation
Risk owner: Full Executive Committee
Breaches of regulations or editorial best practice
guidelines; editorial errors; and issues with employees’
behaviour or the tone of our editorial could damage our
reputation, cause us to lose readership, and put us at risk
of legal proceedings.
We have highly experienced and capable people in our key
senior management roles.
Our governance structures provide clear accountability for
compliance with all laws and regulations, and we have policies
and procedures in place to meet all relevant requirements,
including a crisis management procedure that is
communicated to all relevant staff.
We train all editorial employees on how to create content that
complies with relevant legislation.
We continually monitor upcoming legislative changes and
emerging trends.
We have clear internal expectations around the management
of editorial risk, including a mandatory escalation policy of
significant risks to senior editorial and legal colleagues, and
monthly reporting on editorial risk. We have reviewed and
updated all our Editorial Legal policies in 2023, and created
new versions for use in the US. These have formed the subject
of editorial training and been publicised to all members of our
editorial teams via our legal bulletin, which is circulated monthly.
Regulatory
Data protection failure
Risk owner: Group General Counsel/Data Protection Officer
A contravention of data protection regulations
applicable to Reach such as the UK or EU General Data
Protection Regulations (GDPR), Privacy and Electronic
Communications Regulations 2003 (PECR), various
state and federal legislation in the US and Canada
(e.g. the updated California Consumer Privacy Act
CCPA Amended), could lead to monetary penalties,
reputational damage and a loss of customer trust.
We have clear governance structures to direct and oversee
our data protection strategy.
Our Data Protection Officer and Data Protection team promote
and advise on compliance with data protection regulations,
address rights requests, provide oversight and help mitigate
the risk of compliance breaches. The team works with a
network of data protection champions and teams across
the business to assist the business in delivering its data
protection obligations.
We have well-established data protection policies, processes
and controls to govern how colleagues carry out day-to-day
activities involving the handling of personal data, plus clear
terms with regards to the collection, use, sharing and retention
of user data, including data transferred to third parties.
When developing new products and services, we use a ‘data
protection by design and default’ approach to collecting and
using personal data, to ensure we remain compliant with data
protection regulations.
During the year we continued to focus on embedding data
protection controls and processes and ensuring that data
protection forms part of ‘business as usual’ in everything we do.
This included reviewing and enhancing our Data Protection
risk and reporting framework to incorporate new legislative
requirements and regulatory focus areas and ensuring third
parties met the legislative requirements and correct provisions
were in place. We also advised on matters arising from new
projects involving personal data including the US expansion
and artificial intelligence initiatives, and monitored completion
of data protection awareness training.
Key
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2023 VIABILITY
STATEMENT
In accordance with the UK Corporate Governance
Code the directors have assessed the Group’s
prospects over an appropriate period of time
selected by them.
The directors assessed the prospects of the Group
over a three-year period as it enables thorough
consideration of the investment required to drive
growth in digital and the impact of declining print
revenues, and this time period is deemed to
appropriately reflect the evolving environment in
which the Group operates. The assessment took
into account the Group’s current financial position,
principal and emerging risks and uncertainties
facing the Group which have the greatest
potential impact on viability in that period.
When approving the annual budget, projections
for the next two years are also considered. The
annual budget is also used by the Remuneration
Committee to set targets for the annual incentive
plan. The directors also consider projections for the
next 10 years used in connection with the Group’s
impairment review.
Scenario Associated principal risk(s) Description
Significant revenue
reduction
Deceleration of digital
growth alongside
acceleration in decline
of print revenues
Material reduction in digital and print revenues
(net of direct cost reductions) compared to the
three-year plan of 10% per annum.
Adverse changes in
external environment
leading to lower than
expected revenue
and higher than
expected costs
Deterioration in
macroeconomic
conditions
Supply chain disruption
Inflationary pressure in relation to energy and
newsprint costs, together with key supplier failure
in the manufacturing business.
Cyber security breach Cyber security breach
Data protection failure
Damages to brand
reputation
An external cyber attack which leads to breaches
of confidential data and interruption to our systems
and services, resulting in a material reduction in page
views and subsequent digital revenues, together with
additional investigation and remediation costs whilst
the attack is rectified, in addition to associated
regulatory costs and fines.
A number of key assumptions were made in
generating the baseline three-year forecast
as follows:
• digital growth supported by investment in
the Customer Value Strategy;
• print revenue declines with reference to
recent trends and reduction in related costs;
• overall stability in total revenues and
operating profit;
• funding of the historical defined benefit pension
obligations based on the existing schedule of
contributions agreed with the Trustees;
• payments in relation to historical legal and
tax issues reflecting the provisions held in the
balance sheet;
• covenant compliance on existing financing
facilities; and
• dividend payments in each year.
The assessment was undertaken recognising the
principal risks and uncertainties that could have the
greatest potential impact on viability in that period.
A number of hypothetical scenarios have been
modelled. While each of the principal risks on
pages 68 to 72 has a potential impact and has
been considered as part of the assessment, only
those that represent severe but plausible scenarios
were selected for modelling, summarised opposite:
These scenarios were assessed individually and
in unison to understand our capacity for each
risk incident and further stress test viability. The
modelling showed that the Group would be able to
withstand the impact of these scenarios occurring
over the assessment period. The Board also assessed
the likely effectiveness of any proposed mitigating
actions. This did not change the conclusions of
the assessment.
The Strategic Report was approved on behalf of the Board on 5 March 2024.
Darren Fisher
Chief Financial Officer
5 March 2024
Based on the above, the directors have a
reasonable expectation that the Group will
remain viable and be able to continue operations
and meet its liabilities as they fall due over the
three-year period considered.
Such future assessments are subject to a level of
uncertainty that increases with time and, therefore,
future outcomes cannot be guaranteed or
predicted with certainty.
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The Board’s focus for the
year has been continuing
to support and hold
management to account
on the continued journey
of transforming the
business and becoming
a digital-first organisation.
The Board monitors culture and practices
closely across the business to make sure
they’re aligned with our purpose and strategy,
and we recognise that governance plays a
key role in setting up teams for success. We
nurture a culture that encourages colleagues
to be entrepreneurial, take advantage of
development opportunities and fulfil
their potential.
Below is a summary of the most important
Board activities this year. These initiatives
are outlined in more detail throughout the
Governance Report.
Continuing to evolve our strategy
As macroeconomic uncertainty remained
throughout 2023, our strong and effective
governance framework was critical in
supporting the delivery of our Customer Value
Strategy. To give us even greater long-term
stability and control over our business, the
Board spent time discussing whether the
strategy continued to be the right one. These
discussions included an in-depth review and
selection of numerous investment initiatives to
diversify revenue streams and further develop
audience insight and user experience. More
information on the Board’s strategy days
can be found on page 80.
One of the Board’s principal decisions in 2022
was approving two organic growth initiatives:
our youth content brand, Curiously, and our
expansion into the US. The Board regularly
reviewed updates on the progress of these
initiatives, while the Audit & Risk Committee
performed a deep dive into the risks
associated with the expansion into the US
market, and how these are being managed
and mitigated. The Board is encouraged
by the progress made during 2023 and will
continue to monitor and provide oversight
as these initiatives develop.
PLANNING FOR THE FUTURE WITH GOOD GOVERNANCE
Nick Prettejohn
Chairman
Chairman’s statement
Compliance with the UK
Corporate Governance Code
The Board considers that, during 2023,
the Company applied the principles
and complied with the provisions of the
Financial Reporting Council’s (FRC) 2018 UK
Corporate Governance Code (2018 Code).
You can read more about our compliance
with the 2018 Code on pages 127 to 130.
Like many companies, we faced considerable
uncertainty and a rapidly changing business
environment. Our rigorous approach and
willingness to challenge in Board meetings has
meant that the difficult decisions we’ve had to
take ensure the interests of all stakeholders
are considered, and their views sought.
In 2023, the Board sought a capital reduction
of Reach plc to maintain the Company’s ability
to pay dividends to its shareholders and return
capital to shareholders, while also investing
to grow the business and meet our funding
commitments to the defined benefit pension
schemes. This was approved by shareholders
at a General Meeting held in November, and
by the Court in early December. You can read
more about this in our section 172 statement
on pages 85 to 87.
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Our Board and
Executive Committee
We have ushered in some changes to the
Board during the year. Darren Fisher joined
the Board in February 2023 as Chief Financial
Officer, as set out in my Chairman’s statement
on page 5. Darren’s financial, operational and
strategic skills have helped the Board navigate
through a number of complex matters,
while managing the Company’s financial
performance in line with expectations.
At the AGM in May 2023, Steve Hatch
stepped down from the Board after more
than seven years of service, following his
full-time appointment as Chief Executive
Officer of YouGov plc. I would like to thank
Steve for his commitment and outstanding
contribution to the Board during his tenure
as Non-Executive Director.
I am pleased that we have met the targets
on Board diversity that must be reported on
under the new Listing Rule requirements, and
we will continue to prioritise diversity on the
Board. The Board acknowledges that, as set
out on page 91, there is progress to be made
at Executive Committee level regarding
ethnicity and this has been discussed at
Board meetings numerous times this year.
We recognise that diversity needs to be
considered throughout the whole organisation
to maintain a strong and diverse pipeline of
talent and to ensure that the organisation
better reflects its wider audience.
Once again, the Board has continued to work
closely with the Executive Committee and
other senior leaders, particularly through the
two in-depth Board strategy meetings held
during the year. Individual non-executive
directors have also provided insight and
expertise in certain areas to teams outside
the formal Board meeting structure. This is
a two-way relationship that enables non-
executive directors to share their deep
knowledge and expertise, assisting strategic
decision-making in the boardroom, and, in
turn, gaining insight into the business in a
more informal way.
Our responsible
business framework
During the year, the Sustainability Committee
oversaw all the work and progress achieved
under the four pillars of our responsible
business framework, which was created in
2022 to formalise our approach to being
a responsible, sustainable business.
One key area of focus has been setting
reduction targets for greenhouse gas
emissions. We are now in the process of
validating these targets, in order to be able to
announce a net zero commitment date in due
course. More information on this can be found
on page 95.
Reflecting on our effectiveness
as a Board
We regularly reflect on our performance as a
Board and consider ways we can improve our
processes and behaviours to make sure we’re
operating effectively. During 2023, we took
several actions to address the issues and
recommendations that arose from our internal
Board evaluation in 2022, covering ESG, market
developments, training and lessons learnt.
At the end of 2023, we conducted another
internal Board evaluation by way of a detailed
questionnaire. You can find more detail about
our processes, recommendations and actions
on page 90, and we will report on progress
against this year’s recommendations at
the end of the year.
Remuneration Policy
In 2024, we will be asking shareholders
to renew the three-year authority for our
Directors’ Remuneration Policy at the AGM. The
proposed new Directors’ Remuneration Policy
(the Policy) can be found on pages 107 to 115.
The Remuneration Committee has proposed
to roll forward materially the current Policy with
minor changes only.
The year ahead
The actions the business has taken during
2023 prepare us to face 2024 with a refreshed
focus on our digital-first goal. As a Board we
will continue to oversee the delivery of the
strategy, which to be successful will require
diversity of people and thought throughout
the entire organisation. The pace and scale of
change in artificial intelligence (AI) means that
this will be a priority as outlined on page 81
and we will consider setting measures and
targets to monitor progress.
The upcoming corporate governance reforms,
while now not as extensive as originally proposed,
will be another step in strengthening the
governance and controls landscape, and we
will remain focused on overseeing any changes
required to continue to ensure we have a
strong and robust governance framework.
Nick Prettejohn
Chairman
5 March 2024
Chairman’s statement continued
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Our Board
Nick Prettejohn
Chairman
Jim Mullen
Chief Executive Officer
Darren Fisher
Chief Financial Officer
Appointment date: March 2018
(appointed as Chairman in May 2018)
Skills, experience and contribution: Nick has significant
chairmanship and listed company experience. Since his
appointment in 2018, Nick has successfully led the Board through
a period of transition, bringing on board a new CEO, two CFOs, a
Senior Independent Director and Audit & Risk Committee Chair.
Nick has deep financial services experience, in-depth regulatory
knowledge, significant experience in strategic planning and
implementation, and strong leadership qualities. The Board
believes Nick’s strong leadership and chairing skills means he
continues to effectively lead the Board. Some of Nick’s previous
appointments include Chairman of the Financial Services
Practitioner Panel, the Britten-Pears Foundation, Brit Insurance, the
Royal Northern College of Music and Scottish Widows Limited;
Non-Executive Director of Lloyds Banking Group plc, the Prudential
Regulation Authority and Legal & General plc; Member of the BBC
Trust; and CEO of Prudential UK and Europe, and Lloyd’s of London.
Current external appointments: Chairman of TSB Banking Group
plc and the charity Prisoners Abroad, Senior Independent Director
of YouGov plc and a Trustee of the charity Opera Ventures.
Appointment date: August 2019
Skills, experience and contribution: Jim has significant
experience in advertising and communications, having spent
more than 10 years in some of the industry’s leading marketing
and communications groups, as well as on significant digital
transformation projects. Since his appointment in August 2019,
Jim has developed and communicated a clear strategic vision
for the future of the business, and the Board considers his
continuing leadership critical to executing the strategy. Some
of Jim’s previous appointments include Group CEO of Ladbrokes
Coral plc and Ladbrokes plc, Chief Operating Officer of William
Hill Online, and Director of Digital Strategy and Product
Management at News International.
Current external appointments: Senior Non-Executive Director
of Racecourse Media Group.
Appointment date: February 2023
Skills, experience and contribution: Darren is a seasoned
finance professional with more than 30 years’ leadership
experience in global multi-service sector, blue-chip companies
in the UK, India and Australia. Darren has worked across the
media, technology, business services and aviation sectors.
His extensive experience means he offers the Board relevant
insight into strategy development and implementation,
business transformation and integrating acquisitions.
Darren was previously Group Director of Finance of ITV plc,
responsible for the group finance functions and operations.
He was also divisional CFO for the Media & Entertainment division,
which contains the UK broadcast business as well as ITV’s digital
offerings (ITVX). He has previously served as Director of Finance
for Micro Focus plc, Sage plc and Xchanging plc.
Current external appointments: None.
Nomination Committee Audit & Risk Committee Sustainability Committee Remuneration Committee Denotes committee chair
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Our Board continued
Denise Jagger
Senior Independent Director
Priya Guha, MBE
Independent
Non-Executive Director
Anne Bulford, CBE
Independent
Non-Executive Director
Appointment date: December 2022
Skills, experience and contribution: Denise is a qualified
solicitor, having been a partner at Addleshaw Goddard and,
until 2020, at Eversheds Sutherlands LLP. Denise brings extensive
governance and plc experience to the Board, having held a
number of non-executive positions during her career. Her
previous appointments include Non-Executive Director at CLS
Holdings plc, Bellway plc, Pool Reinsurance Company Limited,
Redrow plc, and the British Olympic Association, and Chair and
Pro Chancellor of the University of York. She was also a Director
of Asda Stores, and Group General Counsel and Company
Secretary of Asda Walmart. Through these roles, she has
acquired a broad range of M&A, finance raising, competition,
regulation compliance, HR, and remuneration and
benefits experience.
Current external appointments: Non-Executive Director of
Topps Tiles plc, Trustee of the National Trust and a Member
of the Advisory Panel of the charity IntoUniversity.
Appointment date: September 2022
Skills, experience and contribution: Priya brings a unique
mix of senior diplomatic and governmental leadership to the
Board, alongside extensive experience of the technology sector.
She is a Venture Partner at Merian Ventures, with a focus
on women-led innovation investments. She is also a Non-
Executive Director of Herald Investment Trust, UK Research &
Innovation and the Digital Catapult. Previously, Priya was a
career diplomat, most recently as British Consul General to San
Francisco, with postings before that in India and Spain. In 2021,
Priya was awarded an MBE for services to international trade
and women in innovation.
Current external appointments: Venture Partner at Merian
Ventures, Non-Executive Director of Herald Investment Trust,
UK Research & Innovation and the Digital Catapult, Adjunct
Faculty at the Hult Ashridge Business School, Member of the
Royal Academy of Engineering International Committee and
Trustee of TechSheCan.
Appointment date: June 2019
Skills, experience and contribution: Anne is a chartered
accountant and an experienced media CFO and Audit
Committee Chair. The Board considers her continuing
leadership of the Audit & Risk Committee to be important
to ensuring the Company continues to benefit from an
independent and objective audit. Anne was awarded an
OBE in 2012 for services to UK broadcasting and, in 2020, a
CBE for services to broadcasting and charity. Some of Anne’s
previous appointments include Deputy Director General of
the BBC and Chief Operating Officer of Channel 4. Her previous
non-executive roles include Chair of the Audit Committee of the
Executive Committee of the Army Board, and Audit Committee
Chair of Ofcom and the Ministry of Justice. Anne qualified as a
chartered accountant with KPMG and spent 12 years in practice.
Current external appointments: Non-Executive Member of
KPMG’s Public Interest Committee, Non-Executive Chair of
Trustees of Great Ormond Street Children’s Hospital Charity,
and Governor of the Royal Ballet.
Nomination Committee Audit & Risk Committee Sustainability Committee Remuneration Committee Denotes committee chair
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Barry Panayi
Independent
Non-Executive Director
Wais Shaifta
Independent
Non-Executive Director
Olivia Streatfeild
Independent Non-Executive Director
and Colleague Ambassador
Appointment date: October 2021
Skills, experience and contribution: Barry is an established and
recognised leader in the digital and data space, having spent
most of his career in senior positions at a range of sectors
focusing on data, insight and analytics capability development.
Barry has current executive experience, having worked as Chief
Data and Insight Officer at the John Lewis Partnership since
March 2021. Before this, he was Group Chief Data & Analytics
Officer at Lloyds Banking Group. Barry has extensive experience
in leading data-driven transformations and managing large
teams, having also held senior roles at Bupa and Virgin Group.
He started his career working in consultancy for EY, specialising
in data and digital.
Current external appointments: Chief Data and Insight
Officer at the John Lewis Partnership and Non-Executive
Director of Ofgem.
Appointment date: September 2022
Skills, experience and contribution: Wais brings a varied
ecommerce background and customer focus expertise to the
Board, having previously held executive roles in a number of
online businesses. He has extensive experience driving growth
and transformation for several digitally enabled brands, with a
track record of leveraging data to drive customer engagement.
As the former CEO at Push Doctor, one of the leading digital
healthcare companies in Europe, Wais worked in partnership
with the NHS to connect thousands of patients each week with
clinicians. Before joining Push Doctor, Wais was Director of
Global Operations at Treatwell, and before that International
Operations Director at Just Eat.
Current external appointments: Chief Executive Officer of
PrivateDoc, Non-Executive Director and Chair of the Sustainability
Committee and Remuneration Committee of The Gym Group plc,
Non-Executive Director of Snappy Shoppers Ltd and Operating
Partner of Samaipata.
Appointment date: January 2016
Skills, experience and contribution: Olivia has a strong
commercial and consumer background, having previously held
executive roles at TalkTalk, including as Commercial Director
and Marketing & CRM Director. Olivia has a data-driven and
analytical approach to problem solving, having worked in
consulting for McKinsey & Company. This enables Olivia to
support the Board in overseeing the data-driven and
customer-centric strategy. Some of Olivia’s previous
appointments include Chief Executive Officer of INTO University
Partnerships, Commercial Director of TalkTalk’s consumer
business, and Partner at Sir Charles Dunstone’s investment
vehicle Freston Ventures. Olivia was an Associate Principal at
McKinsey & Company and a leader in the business’s consumer
retail practice.
Current external appointments: Chief Executive Officer of
Flamingo Horticulture Investments.
Nomination Committee Audit & Risk Committee Sustainability Committee Remuneration Committee Denotes committee chair
Our Board continued
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BOARD
IN ACTION
FEBRUARY
MARCH
APRIL
JUNE
MAY
• Darren Fisher joined the Board
as Chief Financial Officer
• Finalisation of the 2023
budget and delivery plan
• Update on Curiously, the
new youth content brand
launched in 2022
• Annual insight into workforce
engagement from Olivia
Streatfeild, our Colleague
Ambassador
• Update on data protection
priorities and progress
• Financial training for Audit &
Risk Committee members
• 2022 full-year results released
and dividend declared to
shareholders, along with
a Company-wide cost-
reduction programme
• 2022 Annual Report approved
• Review of 2022 editorial
output and highlights
• Deep dive into digital
performance
• Gender Pay Gap
Report approved
• The Board held a
two-day strategy off-site
meeting to reassess and
review Customer Value
Strategy (CVS) goals
and priorities
• Colleague lunch held
with the Board and
regional leaders
in Manchester
• Tour of Oldham print site
• Colleague
breakfast hosted by
non-executive directors
• Board visit to the Bristol office
and Colleague lunch held
with the Board and
regional leaders
• Update on the strategic
actions and initiatives agreed
at the strategy meeting in April
• Update on the 2019 and 2022
pensions valuations process
• Broker update on
macroeconomic environment
and investor views on delivery
of the management plan
and strategy
• Review of the Group’s financial
performance and forecasts
• AI training and insights from
an external expert
• Steve Hatch, Non-Executive
Director, stepped down from
the Board
• Product update and user
experience improvements
• Update on cyber security
programme
• Modern Slavery Statement
approved
• AGM held with shareholders
BOARD ACTIVITIES DURING 2023
DECEMBER
• Approval of 2024 budget
• Review of proposed 2024
organisational structure
• Update on data protection
programme
• Annual review of corporate
governance
• Approach to our second
year of reporting under
TCFD approved, including
scenario analysis
• Agreed in principle the
science-based targets for
our pathway to net zero.
To be formally announced
during 2024
• 2023 half-year
results released
and dividend
declared to
shareholders
JULY
• The Board held another
two-day strategy
off-site meeting to
reassess and review
CVS goals and priorities
• Colleague lunch held
with the Board, Executive
Committee and other
leaders in London
• Colleague breakfast
hosted by non-executive
directors
• Climate-related training
for the Board and
Executive Committee
SEPTEMBER
• Proposed Reach plc
capital reduction of
the share premium
account announced
• Conclusion of the 2019
and 2022 triennial
pensions valuation
for the MGN pension
scheme announced
• Update on cyber
security programme
OCTOBER
• Cost-reduction
programme for
implementation in
2024 announced
• General Meeting to
approve Reach plc
capital reduction
of the share
premium account
NOVEMBER
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Driving revenue growth
Building a
culture where
people thrive
Developing
a data-led
proposition
Growing through
audience
engagement
Delivering
the stories
that matter
l
o
y
a
l
t
y
G
r
e
a
t
e
r
M
o
r
e
r
e
l
e
v
a
n
t
c
o
n
t
e
n
t
M
o
r
e
e
n
g
a
g
i
n
g
e
x
p
e
r
i
e
n
c
e
Strategy days
The Board held two in-depth strategy days
in April 2023 and September 2023. Having
initiated the Customer Value Strategy (CVS)
in 2020 the goals and objectives of the
sessions were to reflect on the progress
the Company had made since then,
and identify further areas with potential
for growth.
Given the importance to the Board of
understanding the business rationale
and the risks and opportunities faced, the
Executive Committee and Board worked
together throughout the strategy days to
encourage an immersive debate and
discussion. At the end of the sessions, the
Board was given the opportunity to reflect
collectively and make key decisions.
The main topics covered over both
sessions were:
• re-affirming Reach’s current strategic
priorities for a data-led, customer-
centric proposition and evolving the
interpretation of the CVS to broaden
revenue beyond advertising while still
protecting its core purpose – journalism;
• knowing our customers and the benefits
of data, and considering the results of
an external customer insights panel;
• the future of the CVS and the
consideration and debate of
numerous investment initiatives;
• editorial restructure, the future of the
newsroom and Company culture; and
• the risks and opportunities surrounding AI.
The outcomes were:
• an agreement to diversify revenue
streams through Mantis, affiliates
and ecommerce and consider
new initiatives as appropriate;
• a plan to restructure editorial to
enable a digital-first approach
and continue the development of
audience insight and user experience;
and
• an agreement that the Board would
continue to monitor the culture of the
business and its development so that
Reach can attract the best talent.
Next steps
Given the ongoing development of
strategic priorities, the Board will continue
to monitor and critically evaluate progress
made. As well as reviewing progress at two
planned off-site strategy sessions in 2024,
the Board will spend time outside these
sessions discussing all aspects of
the strategy.
Board in action continued
SUPPORTING DELIVERY
OF THE STRATEGY
Purpose
Our purpose is to enlighten, empower
and entertain through brilliant journalism.
This purpose directly informs and inspires our
strategy. By better understanding our customers
and delivering more data-led content and
advertising, we can continue to invest in our
journalism, our people and our future.
To deliver our purpose, we must continue to
strengthen our data capabilities and audience
engagement and support our strategy by
maintaining a company culture that empowers
our people to perform at their best.
For more information, see our strategy on
pages 18 and 19 of the Strategic Report.
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Directors’ attendance at Board and Committee meetings during
the year is outlined below:
Director Board
Nomination
Committee
Sustainability
Committee
Audit & Risk
Committee
Remuneration
Committee
Nick Prettejohn 10/10 3/3 2/2 n/a 5/5
Anne Bulford 10/10 3/3 2/2 5/5 5/5
Darren Fisher 10/10 n/a 2/2 n/a n/a
Priya Guha
1
10/10 3/3 2/2 4/5 5/5
Steve Hatch
2
4/4 1/1 n/a 2/2 2/2
Denise Jagger
3
9/10 3/3 2/2 5/5 4/5
Jim Mullen 10/10 3/3 2/2 n/a n/a
Barry Panayi 10/10 3/3 2/2 5/5 5/5
Wais Shaifta 10/10 3/3 2/2 5/5 5/5
Olivia Streatfeild 10/10 3/3 2/2 5/5 5/5
1. Priya Guha was unable to attend an Audit & Risk Committee meeting due to a pre-existing commitment prior
to joining the Company
2. Steve Hatch left the Board in May 2023
3. Denise Jagger was unable to attend a Board meeting and a Remuneration Committee meeting due to
pre-existing commitments prior to joining the Company
Board in action continued
INCREASING OUR FOCUS
ON ARTIFICIAL INTELLIGENCE
Throughout 2023, the Board regularly
discussed artificial intelligence (AI) and its
increasing relevance and importance to
Reach, in terms of both risks and opportunities.
It became apparent in these discussions that
the Board needed to increase its knowledge
and understanding of this complex area, and
so in June an external expert presented to
the Board. They provided insights into the
development and potential of AI as well
as data and governance issues to be
considered and tackled, particularly as
technology advances.
The Board has had oversight and been kept
informed of the workstreams and outputs of
the internal AI steering group. This group is
cross-functional across all divisions of the
business, including the General Counsel,
and covers editorial usages, innovation
and governance.
The Board recognises the importance of
creating an environment where teams can
innovate by testing and trying out new ideas,
products and ways of working to realise the
potential of AI while at the same time building,
maintaining and monitoring a robust
regulatory framework. During 2024, additional
training will be provided to the Board as
required, and a list of AI topics relevant to
the business will be reviewed and discussed
regularly at Board meetings. We will also
consider setting measures and targets
for AI to monitor progress.
OVERSEEING CYBER SECURITY
AND DATA PROTECTION
During 2023, the Board, together with the
Audit & Risk Committee, continued to oversee
the steps taken and measures put in place
to mitigate the risk and impact of a cyber
security breach and/or a data protection
failure. The Board has identified both of these
as principal risks (for more information, see
pages 68 to 72).
These steps and measures include:
• endorsing the move to be more objectively
risk-based to better focus cyber security
efforts on the threats to the business, the
state of defences and the threat landscape;
• overseeing the development of a
measurement framework to track
improvements in cyber security, which
includes the development of a consistent
set of KPIs to monitor and report progress
on the security improvement journey;
• reviewing the key findings of an audit review
on cyber security arrangements, which
focused on the design and implementation
of controls to ensure the confidentiality,
integrity and availability of systems,
enterprise assets and Reach data;
• receiving updates on cyber security training
for colleagues, such as major cyber security
incident preparation and simulation
desktop exercises;
• receiving updates on the comprehensive
programme in place to deliver the Group’s
data protection and privacy strategy to
enable Reach to meet its commercial
goals and data-led digital-first growth in
a privacy-compliant way (this includes
updates on focus areas and any action
plans in place); and
• overseeing compliance with relevant
privacy laws in the US and Canada following
the 2023 expansion into the US, plus the
legal and regulatory data protection
requirements of evolving laws in existing
markets, and new technology such as AI.
The Board and Audit & Risk Committee will
continue to stay regularly informed and
updated, and recognise that the success
of the cyber security and data protection
programmes depends on engaging with,
and the capability within, all business units.
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MONITORING OUR CULTURE
The Board wants Reach to be a community
in which all colleagues feel respected, happy
in their work, united by a shared purpose and
empowered to succeed. And while the Board
works to establish and support this culture, it
is the individual actions of all colleagues that
make it a reality and ensure that it is
embedded within the business.
For the Board, developing a culture that
encourages and creates opportunities for
individuals and teams to thrive and to realise
their full potential is not only the right thing to
do for us as people but also helps create long-
term value for shareholders and stakeholders.
Throughout 2023, the Board used several
indicators and measures to monitor and
assess the Group’s culture, and we describe
some of those below.
Employee engagement surveys
and experience
The Board receives quarterly reports
on engagement survey results, which
contain several culture-related questions.
The HR Director reports the findings to the
Board and discusses key focus areas and
actions in detail.
The mechanisms for understanding
engagement include:
• employee metrics, such as absence,
unplanned leavers and churn, employee
relations cases, health and wellbeing, and
talent, including management training;
• engagement forums, such as interest
networks, working groups, ambassadors
and union relationships; and
• employee feedback, such as monthly
surveys, focus groups, leadership meetings
and monthly check-ins for all colleagues
with their managers.
In response to feedback from 2022 that our
people were concerned about attracting
and retaining talent, a new Head of Talent
Development joined in July 2023. The 2023
priorities have been to evolve the employee
experience and also to develop both a career
development framework and editorial
recruitment practices to deliver a truly
innovative platform and a customer-first
newsroom fit for the future.
The Board continues to encourage
improvements in systems and processes that
benefit the health and wellbeing of our people,
and wellbeing zones have been put in place in
some of our offices.
Colleague Ambassador
In her role as Colleague Ambassador,
Non-Executive Director Olivia Streatfeild
provides the Board with an independent link
to our workforce. Olivia joins regular employee
engagement review meetings with our Group
HR Director, which cover key diversity and
inclusion initiatives and outputs, overall
employee experiences and feedback, and
talent and succession planning. These are
all supported by clear data and evidence.
Olivia reports her observations and the
matters raised by colleagues to the Board to
make sure they are considered and factored
into key decisions. Olivia also continues to
attend colleague forums and Inclusion
Champion meetings, and her participation
has been received positively by our people.
Site visits
All our Board members met with colleagues in
person this year, as part of visits to our Oldham
and Bristol hubs, a tour of the Oldham print
site, and also a lunch held in London with
the Executive Committee and other leaders.
These allowed the Board to gather views
about how well the strategy was understood
and embedded within the business and
gain valuable insights into the regions.
Colleague breakfasts
The Board decided to expand opportunities for
engagement with the workforce in 2023 and
introduced colleague breakfasts with non-
executive directors (without senior executives
present) to our events schedule. Olivia
Streatfeild hosted both breakfasts as
Colleague Ambassador and was joined
by Wais Shaifta in April and Priya Guha in
September. The breakfasts were held in person
in small groups to make sure everyone had
a chance to be heard and give the Board a
direct insight into the opinions of the workforce,
its current morale and any issues faced by the
business. Colleagues from a wide range of
teams attended both breakfasts to ensure a
diverse range of voices were present, including
the editorial, commercial, finance, IT, HR, print,
customer and product teams.
“It was great to see the linkages and interactions
across different sites in action and to speak to
colleagues about how the operational structure and
system dynamics fit together and work in practice.
Reach is home to many titles and brands, but I got
a real sense from colleagues that they felt well
connected and passionate about what they do.”
Barry Panayi, Non-Executive Director
Board in action continued
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The insights and outcomes of the sessions
were fed back to the Board at the following
Board meetings. Themes raised included:
• user experience;
• keeping up morale in the newsroom;
• the split between focus on page views
versus engagement;
• acquiring, retaining and developing top
talent; and
• creating career paths for technical experts
and premium content journalists.
The sessions were very well received by both
colleagues and the Board, and we are
scheduling further ones for 2024.
Diversity and inclusion
The Group Head of Diversity and Inclusion
presented regular updates to the Board. In
2023, these included updates on that year’s
agreed priorities (read more on page 41 and
42) which were:
• line managers having accountability and
responsibility for ensuring inclusive behaviour;
• increasing participation rates and reducing
‘Prefer Not to Say’ responses in Be Counted
employee data; and
• delivering a programme of outreach
activities to support social mobility in
the communities we serve.
The Board recognises that the employee data
it receives helps it to understand and refine
the cultural and organisational characteristics
of Reach. During 2024, it will continue to focus
on gathering high-quality information to
enable it to critically monitor progress.
At the end of 2022, Reach signed up to
Generation Valuable, a 12-month programme
that aims to address the gap in disability
talent. A participant who was mentored by
Jim Mullen, our CEO, provided an update to
the Board on the 2023 objectives for the
programme. Reach is striving to accelerate
inclusion in this area and ensure it is truly
embedded in the business. You can read
more about this on page 44.
Talent
The Nomination Committee regularly
receives talent assessment updates about
the Executive Committee and its direct reports.
This provides the Board with insight into
decision-making around investing, succession
planning and managing our talent pipeline, in
line with Reach’s values, vision and strategy.
Compliance
The Board oversees the implementation of
policies regarding anti-bribery, anti-slavery,
data protection and cyber security. It also
oversees e-learning modules for colleagues
and receives regular updates on completion
rates. The Head of Risk and Internal Audit
provides updates on any matters raised
through the Group’s whistleblowing procedures.
Board in action continued
“Colleague breakfasts are an invaluable way to have
rich discussions with teams across the business.
These have covered managing the tension between
short and medium-term objectives, competing
for talent, the impact of our efficiency focus on
colleague morale, and how to increase the speed
of innovation. As a Board, we have an informed
overview of our colleagues’ biggest concerns and
opportunities, as well as our strategic priorities.”
Olivia Streatfeild, Colleague Ambassador
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What is your background and why did
you join the Company?
Throughout my career, I have enjoyed working
in large, multi-site organisations with high
numbers of employees, similar to Reach.
I like fast-paced, competitive and dynamic
marketplaces and consumer-facing
businesses. In complex and geographically
spread organisations, the company’s purpose
and its strategy to deliver must be clearly
understood and well communicated across
all areas, and the challenge of achieving this
at Reach interested me. A further motivation
was the opportunity to oversee digitisation,
which is particularly significant for Reach
as the Company focuses on accelerating
development in this area against a backdrop
of print decline. I was also keen to join an
impressive and diverse Board focused on
ensuring the business is modernised and in
tune with changing consumer demand and
emerging technologies.
Which sites did you visit last year and
what impressions and insights did you
gain from them?
I visited the Newcastle office, and also the
Oldham site as part of the Board’s off-site
strategy days. I’m a big advocate of site visits,
not least because of my retail background but
also because you can experience the culture
of a company first-hand and ascertain
whether colleagues are empowered to do
their job, rather than just hearing about it
second-hand in the boardroom.
Board in action continued
Q&A WITH
DENISE JAGGER
Senior Independent Director
“We want to look beyond those
people immediately visible to the
Board so that we are informed and
can more effectively support the
executive’s plans for their teams.”
I’ve met colleagues at all stages of their careers,
which is important when looking at succession.
Site visits are a great litmus test for the
strategy, enabling you to understand whether
it’s understood across all business functions.
Site visits also enable Board members to
increase their understanding of operating
parameters, which informs strategic
decision-making.
How have you found the induction
process, and do you have any
suggested improvements?
The induction process was thorough. I was
well briefed through a series of meetings
with senior executive team members and
key advisers on the operating landscape and
the issues the Company faces, which helped
me quickly get up to speed. Future director
appointments would benefit from additional
briefings in 6-12 months once a greater
understanding of the business has been
established, resulting in a more rigorous line
of questioning and specific areas of interest.
I also highly recommend site visits as a
useful part of the induction process.
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Under the UK Companies Act 2006 (the Act),
we must promote the success of the
Company for the benefit of its members as a
whole – and, in doing so, consider the interests
of all our stakeholders in the decisions we
make, along with any other relevant factors.
We consider the interests and views of all our
stakeholder groups (as outlined in the table on
pages 86 and 87), the effect of the Company’s
operations on the community and the
environment and the need to act fairly
between stakeholders.
We acknowledge that key decisions we make
will affect long-term performance. We also
recognise that every decision we make will not
necessarily result in a positive or equivalent
outcome for all our stakeholders. By
considering our purpose, vision and values,
together with our strategic priorities, we are
better able to choose the best course of
action for the Company while maintaining
our reputation for high standards of business
conduct. In the same way, by assessing the
outcomes of our decisions and engaging with
stakeholders, we can determine and revise
potential decisions in the future.
In this section, we set out how the Board has, in
performing its duties over the year, considered
matters set out in section 172 of the Act,
alongside examples of how each of our
key stakeholders has been considered and
engaged. We also discuss how we do this
on pages 30 to 53 of the Strategic Report.
Principal decisions in 2023
Here are three examples of our principal
decisions in 2023 and how we considered
section 172 matters.
PLANNING FOR THE FUTURE
In March and November 2023, the Board
approved and the Company announced a
cost-reduction programme that committed to
a 5-6% reduction in the Company’s operating
costs for 2023 and 2024. Part of the programme
for 2024 proposed the reduction of the
workforce by an estimated 450 full-time roles.
These difficult decisions were made against
the backdrop of the macro-environment:
fundamental changes in the external market,
rising interest and inflation and a change
in audience behaviour resulting in shifts in
advertising spend. Throughout the year, the
Board has considered the information and
data available to it, and debated and
discussed the pros and cons to satisfy itself
that any decisions were made after taking
into account all stakeholder interests.
While the business is having to let a number of
colleagues leave the business and drive cost
efficiencies, the Board’s decision on this was
taken to safeguard the sustainability of the
business in the medium to long term. As
a result, we can ensure that the business
operates in a way that creates value for our
shareholders, continues to make progress to
deliver our core purpose and protects the
future of our journalism. Alongside this, in
considering the needs of other stakeholders
when making such decisions, the overall
reduction in costs enables the Board to
reform the shape of the business. This will
allow us to capture a wider audience online
in accordance with their changing habits,
ensuring our journalism remains relevant and
engaging to the communities that are served,
which in turn secures advertising spend. It is
also critical that as a company, our financial
obligations, particularly to our pension trustees,
continue to be met.
PENSION SCHEMES
Having settled all but one of the 2019 triennial
review of pensions within the statutory
15 month period, the Company continued
to work with the Trustees of the MGN pension
scheme during 2023 to achieve its resolution.
In October 2023, the Board approved, and the
MGNPS Trustee agreed, both the 2019 and 2022
triennial valuations for the MGN pension scheme.
The decision was taken to settle the pension
funding at an extra cost of £5m per annum to
the business. While the Board recognises the
additional financial burden, this agreement
was made having carefully considered
stakeholders’ expectations around pension
commitments and the benefit to be gained
by all stakeholders in creating certainty for the
business that enables it to plan for the future.
CAPITAL REDUCTION
In October 2023, the Board decided to seek
shareholder and subsequent court approval
of a reduction in capital. A shareholder
General Meeting was held on 15 November
2023 and court approval was given on
5 December 2023. The reduction in capital
resulted in the cancellation of the balance
standing to the credit of the Company’s share
premium account (£605.4m) and the creation
of distributable reserves of the same amount.
The capital reduction itself did not involve any
return of capital to any shareholder.
In taking this decision, the Board was
unanimously of the view that such reserves
would be available to support the future
payment by the Company of dividends or
other distributions to its shareholders (as
considered appropriate and in accordance,
and subject to, the Company’s Dividend
Policy) while also meeting our funding
commitments to the defined benefit
pension schemes.
SECTION 172
STATEMENT
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S172 statement continued
BOARD ENGAGEMENT
Stakeholder How the Board engaged in 2023 Outcomes and impact
Our people • Site visits to the Manchester and Bristol hubs, where the Board met with colleagues on an
informal basis and hosted lunches with Reach leaders
• Olivia Streatfeild, Colleague Ambassador, hosted two breakfast sessions with colleagues, each
attended by another non-executive director, to hear about challenges currently faced by the
business from a diverse range of voices (read more on pages 82 and 83)
• Tour of the Oldham print site, providing an opportunity for directors to speak to colleagues
involved in the print manufacturing process
• The directors continued to interact with senior leaders and receive their presentations at Board
meetings. Executive Committee members all regularly present to the Board, often discussing
the views and sentiments of their respective teams
• The CEO held fortnightly breakfast sessions with colleagues across the business and, together
with the CFO, held regular town halls with colleagues
• The Board received regular updates on HR matters, diversity and inclusion, and employee
engagement survey results
Site visits and face-to-face interactions with colleagues provided
first-hand insight into culture and sentiment within the business,
helping the Board make broader strategic decisions.
Through regular diversity updates, the Board endorsed the inclusion and
social mobility agenda for 2023. Reach has been ranked as the 19
th
most
inclusive employer in the Inclusive Top 50 UK Employers List 2023/24
(up from 29
th
the previous year).
Customers • Received regular updates on the two organic growth initiatives approved by the Board in 2022:
Curiously, and entry into the US market
• Discussed the use of behavioural and contextual data to understand customers better and drive
page views
• Considered initiatives to boost page views following declining digital referral volumes
• Discussed AI and its potential application and use, as well as risks and opportunities
• Received the results of a customer insights panel to understand the digital behaviour
of the general audience and how the brands’ content relates to this
Customer insight and market knowledge are a vital part of the decision-
making process, for example, in areas such as new market development
and expansions.
The Board has requested more research and detail into customer
insights and the output of this work will be presented for debate in 2024
to further assist our strategic thinking.
Communities • The Sustainability Committee received presentations on the positive social impact that the
Group’s content has had on communities across the country, through campaigns, lobbying
and forcing change, protecting the environment and promoting social good
• Undertook climate training on Scope 1, 2 and 3 greenhouse gas emissions, and
science-based targets
• The Audit & Risk Committee and Sustainability Committee monitored compliance with, and
progress on, the journey to net zero and climate-related reporting, including the Task Force
on Climate-related Financial Disclosures (TCFD) and climate scenario analysis
• The Board received an update on the Generation Valuable programme and Reach joining the
Valuable 500: a partnership of 500 global companies working together to end disability exclusion
The Board deepened its understanding and awareness of ESG factors
to help inform its decisions.
The Board approved near-term science-based targets to commit to
reducing Scope 1, 2 and 3 emissions.
The Board has encouraged the application of measurable objectives
to monitor continued progress in the Generation Valuable programme.
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Stakeholder How the Board engaged in 2023 Outcomes and impact
Advertisers • Received regular updates from executive directors on advertising performance and also
marketplace trends as part of the financial performance
• Received regular presentations throughout the year about the development of Mantis,
our in-house machine learning tool
This engagement enabled the Board to understand the opportunities and
the challenges, and to interrogate the revenue impact of the strategy.
Approved further investment in Mantis.
Suppliers
and partners
• Discussed contracts and relationships for major suppliers, looking at each supplier’s
perspectives and pressures, and at the key risks to Reach and relevant mitigating actions
• Reviewed and negotiated the terms of two significant raw material suppliers
• Agreed a new IT outsourcing supplier and oversaw its implementation and rollout across
the business
Ongoing monitoring to make sure the benefits outweigh the risks,
including shipping risks and changes to our carbon emissions.
We changed one significant raw material supplier this year. The potential
environmental impact was considered before we made this change.
By moving to a new IT outsourcing supplier it was determined that
there would be a significant reduction in cost, improved automation,
enhanced efficiencies and a more streamlined service.
Shareholders • Held an AGM in May 2023, providing an opportunity for shareholders to interact with directors
and ask questions
• Held a General Meeting in November 2023 to approve a capital reduction of the Company’s
share premium account
• The Chairman held meetings with institutional shareholders to discuss topics such as
governance, risk and remuneration
• The Remuneration Committee Chair met with institutional shareholders to discuss the 2024
Remuneration Policy
• The CEO and CFO held investor roadshows and results of briefings for the full-year and half-year
results, involving presentations and Q&A sessions for analysts
• Reviewed reports and received presentations from brokers and the Investor Relations Director on
shareholder feedback and market perceptions
Engagement activities provide opportunities for the Board to
communicate its strategy and financial performance and to
understand shareholder views and perceptions.
The 2024 Remuneration Policy can be found on pages 107 to 115
and shareholders will be asked to approve this at the 2024 AGM.
The capital reduction became effective on 18 December 2023, which
means the full amount from the Company’s share premium account
can now be utilised as distributable reserves.
Pension funds
and members
• Regularly discussed the triennial valuations alongside lawyers and advisers for support The 2019 and 2022 triennial valuations for the MGN pension scheme
were concluded and the schedule of contributions has been agreed
with the trustees. Discussions with the other pension scheme Trustees for
the 2022 triennial review are expected to be completed by the 31 March
2024 due date.
Government
and regulators
• Received regular regulatory updates from the CEO and Head of External Communications
covering topics such as the Online Safety Bill, the Digital Competition Bill and Ofcom’s
consultation on the BBC’s operating licence
• Through the CEO’s chairmanship of the News Media Association, the Board received regular
updates regarding the views and concerns of the Government, regulatory authorities, industry
bodies and other organisations on political, legal and regulatory matters
Government policies and regulation in areas such as competition and
technology can affect our ability to operate effectively. We will continue
to engage with the Government and other stakeholders to make sure
our views feed into policymaking.
S172 statement continued
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There were several changes to the Board at
the end of 2022 and the start of 2023, and
inducting and embedding the new Board
members to enable them to contribute
effectively to Board discussions from the
outset was a key priority of the Nomination
Committee (the Committee) during the year.
We performed an internal evaluation again
this year and the results and progress made
against last year’s recommendations are
discussed on page 90. Recognising the need
for more interaction with colleagues during
2023 was a key outcome of 2022’s evaluation,
so I am pleased that we were able to meet
with colleagues in Oldham and Bristol as part
of our two awaydays. We also held a lunch
with the Executive Committee and other senior
leaders in London. Two colleague breakfasts
were also hosted by non-executive directors,
providing direct insights into workforce
sentiments and morale. We will continue
with these valuable engagements in 2024
and beyond. You can learn more about the
2023 events on pages 82 and 83.
Building and maintaining a diverse
and inclusive workforce is of the utmost
importance to the Board and the Committee
and its desire to achieve this goal influences
every hiring discussion and decision.
At the end of 2023, the Board was 44.4%
female (four of nine directors), with two Board
members from an ethnic minority background.
The position of senior independent director is
also held by a woman, meaning the Board
meets the new diversity requirements under
the Listing Rules. The Board aims to maintain
or improve on this level in the future and also
looks to make progress on diversity in other
areas of the business.
Olivia Streatfeild will reach her nine-year
tenure at the end of 2024 so as a Committee,
we will consider the composition of the
Board during the year. This will also include
considerations for her other Board roles
of Remuneration Committee Chair and
Colleague Ambassador. Executive and senior
management succession and talent will
remain a keen area of focus, to ensure that
we develop the strong and diverse pipeline of
future leaders we need to deliver our strategy
and long-term plans.
Nick Prettejohn
Nomination Committee Chair
5 March 2024
COMPOSITION, SUCCESSION AND EVALUATION
Nick Prettejohn
Nomination Committee Chair
Nomination Committee Report
Role of the Committee
The Committee is responsible for:
• Board composition – the Committee
considers the balance of skills, diversity,
knowledge and experience of the Board
and its Committees, and reviews the
Board’s structure, size and composition,
including the time commitment required
from non-executive directors;
• Board appointments – the Committee
leads on the recruitment and
appointment process for directors and
makes recommendations regarding any
adjustments to the composition of the
Board; and
• succession planning – the Committee
proposes recommendations to the
Board for the continuation in service
of each director and ensures that the
Board is well prepared for changes to
its composition with appropriate
succession plans in place.
The Committee has formal terms of
reference, which are available on the
Company’s website at www.reachplc.com.
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Nomination Committee Report continued
Committee membership
The members of the Committee are the
Chairman of the Board as the Committee
Chair, all non-executive directors and the CEO.
The majority of Committee members are
independent non-executive directors. The
Committee met three times during 2023 and
attendance is set out in the table opposite.
Key focus areas
Board succession planning
At least twice a year, the Committee discusses
the future composition of the Board, with a
rolling programme to consider the size and
shape of the Board, taking into account the
tenure of individuals, expertise required
and diversity. Denise Jagger was appointed
as Senior Independent Director in December
2022 and Darren Fisher as Chief Financial
Officer in February 2023. The focus for 2023
was embedding the new Board members,
including reviewing and improving the
induction process. You can read more
about Denise’s programme on page 93.
Steve Hatch left the Board in May 2023 due to
external commitments and it was decided not
to appoint a replacement to reduce the size of
the Board to its former level.
The Committee regularly reviews Board and
Committee succession plans. There were no
changes to Committee Chairs in 2023, but
emergency and short-term succession plans
for Board and Committee roles were reviewed
and agreed by the Committee.
Executive succession planning and talent
The Committee regularly reviews Executive
Committee and senior management
succession planning and has formal plans
in place for the short, medium and long term.
Emergency plans are in place should the need
arise for any executive position, which are
periodically assessed.
The Committee also received presentations on
the performance of the Executive Committee
and other senior managers and reviewed the
Executive Committee and senior
management pipeline.
Board Diversity and Inclusion Policy
A Board Diversity and Inclusion Policy
(the Policy) was introduced in 2021 and is
available to view on the Company’s website at
www.reachplc.com/corporate-governance/
policies. It is reviewed annually and was last
substantially updated by the Committee in
2022 to include Board diversity targets in line
with the Listing Rule targets, and to cover the
diversity policies of the Board Committees
and wider diversity characteristics.
The Policy formally sets out the Company’s
approach to the diversity of the Reach plc Board.
The Policy is consistent with the Company’s
objective to promote diversity and inclusion
(D&I) across the business and is aligned with the
Company’s three D&I pillars: connect, respect
and thrive. This helps to ensure that the skills,
experience and social, cultural, educational
and professional backgrounds of the
workforce are appropriately diverse
to support the Company’s strategy.
The Group’s Diversity and Inclusion Policy
and its objectives are inextricably linked to the
Company’s strategy, a part of which is focused
on creating a culture in which all can thrive.
The governance framework ensures that, for
senior leaders, the Executive Committee and
the Board’s strategic priorities incorporate D&I
where appropriate. For example, senior leaders
have developed and implemented action
plans to support the achievement of each
function’s inclusion strategy and to embed
it throughout the organisation. You can read
more about how D&I forms part of our strategy
on pages 41 to 44.
Committee membership
and attendance
Nick Prettejohn, Chair
Anne Bulford
Priya Guha
Steve Hatch
Denise Jagger
Jim Mullen
Barry Panayi
Wais Shaifta
Olivia Streatfeild
“Building and maintaining
a diverse and inclusive
workforce is of the utmost
importance to the Board
and the Committee and
the desire to achieve this
goal influences every
hiring discussion
and decision.”
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The table below sets out the actions undertaken during the year as a result of the 2022 evaluation, and also actions to be taken in 2024 as a result of
the 2023 evaluation.
Issues and recommendations from 2022 evaluation Actions undertaken in 2023
ESG
Having established the responsible business framework
in 2022, further develop and articulate the Company’s
approach to ESG
Reach has created a Sustainability Network to bring together people across the Company
who are keen to make a difference on ESG initiatives, and to discuss how the Company can be
more sustainable.
We organised two colleague breakfasts, each attended by two non-executive directors, providing
an opportunity for the Board to engage with employees.
We completed a full Scope 3 emissions inventory, a key goal in our climate strategy. More details
can be found on page 48.
Market developments
More information about market developments and how
the Company is performing relative to competitors to be
provided to the Board
The Board discussed and reviewed a paper on the competitive landscape of Reach at a Board
meeting. An external expert was then invited to join a subsequent Board meeting to present
insights into the development and potential of AI.
Training
Offer the Board more training and deep dive sessions on
topics requested by the Board, from both an internal and
external perspective
External subject matter experts delivered financial and climate-related training to the Board.
The Audit & Risk Committee conducted deep dives into brand reputation and ongoing business
funding, overseas operations, cyber risk and data protection.
The Board conducted a deep dive into how the curated marketplace worked, and how Mantis
was being used to enable the monetisation of data.
Lessons learnt
Ensure that lessons learnt from past decisions are
reviewed and captured, and are used as part of
decision-making for future strategic initiatives
The Board has regularly discussed how its decision-making process has changed and directors
continue to be open and honest about lessons learnt.
Issues and recommendations from 2023 evaluation Actions to be undertaken in 2024
Board engagement
Continue the Board’s formal and informal engagement
activities with key talent across the Group
Key talent (including the level below the Executive Committee) to present where appropriate to
the Board and Committees. Informal Board engagement with leaders to also be arranged during
the year.
Succession planning
Review the Board’s composition and the skill sets needed
over the medium term
Board skills matrix to be revisited to determine desired skills for future Board members.
Succession planning for the roles of Remuneration Committee Chair and Colleague
Ambassador to be considered.
Risks and controls
Continue work to strengthen governance and controls in
light of upcoming governance reforms
Continue to document and where necessary further strengthen controls, and ensure compliance
with the new FRC’s UK Corporate Governance Code requirements under the sponsorship of the
Audit & Risk Committee.
Nomination Committee Report continued
Evaluating performance
A formal review of the Board, its Committees
and the Chairman is performed annually. The
Board last undertook an externally facilitated
evaluation in 2021. The 2022 and 2023 reviews
were conducted internally and led by the
Chairman, Nick Prettejohn. The non-executive
directors, led by the Senior Independent
Director, Denise Jagger, conducted a review
of the Chairman’s performance, with Denise
providing feedback from this review to Nick.
A detailed questionnaire was completed
by all Board members, regular Committee
attendees from senior management and
external advisers. The questionnaire sought
feedback on a range of matters, including the
Board’s oversight of purpose, values, strategy
and risk, and the composition and diversity of
the Board, as well as themes and issues that
emerged from the last external evaluation in
2021. The 2023 evaluation confirmed that
the Board was operating effectively, with
appropriately balanced agendas and
discussions to cover all key areas and issues.
The four directors that joined the Board at the
end of 2022 and the start of 2023 had embedded
well, contributing to robust debate and
challenge, and open communication. Further
progress had been made in interactions with
colleagues, through the comprehensive
programme of awaydays, site visits, and
colleague lunches and breakfasts.
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The Board aims to maintain or improve this
level of diversity in the future and also looks
to make progress on diversity in other areas of
the business. The Committee keeps the Board
composition and size under review to maintain
an appropriate balance of skills, experience,
diversity and knowledge for the Group. The
Board also recognises the importance of D&I
at senior management level. The Group’s
Executive Committee, the members of which
are direct reports of the CEO and CFO, is made
up of nine members, including the CEO and
CFO. In 2023, there were three women on the
Executive Committee (2022: two). There are
80 direct reports to the Executive Committee
for the purposes of FTSE 350 Women Leaders
Review reporting, of whom 37 were female.
Information on senior management initiatives
on D&I can be found on pages 41 to 44 of the
Strategic Report. The percentage of women
within the Group overall decreased slightly to
39.0% (2022: 39.1%), with women occupying
36.3% of senior managerial roles across the
Group (2022: 39.4%).
In 2021, Reach plc joined the 30% Club,
committing the Company to 30%
representation of women on the Board,
including one person of colour by 2023, and
30% representation of women on the Executive
Committee, including one person of colour
by 2023. By committing to these targets, the
Board also voluntarily committed to meeting
the Parker Review requirements by 2024. At the
end of 2023, these targets had been met, other
than the Executive Committee including one
person of colour.
Nomination Committee Report continued
The Board also aspires to meet the Parker
Review requirement on a voluntary basis for
the Executive Committee that at least 10% of
the Executive Committee will self-identify as
being from an ethnic minority background
by 2027.
Our Be Counted initiative was launched in
2021, to capture colleague demographic and
diversity data and develop the D&I strategy.
According to the protected characteristics of
the Equality Act 2010, along with socioeconomic
data, Reach is able to identify areas of
opportunity, along with challenges, to help
drive D&I activity. Regular updates of the results
of the Be Counted initiative have been provided
to the Board, including how this has fed into
progressing the social mobility agenda.
The following table sets out the information
required under Listing Rule 9.8.6R (10) on the
Board’s and executive management’s ethnic
background and gender identity or sex:
Number of
Board
members
Percentage
of the Board
Number of
senior positions
on the Board
(CEO, CFO, SID
and Chair)
Number
in executive
management
Percentage
of executive
management
Men 5 55.6% 3 6 66.7%
Women 4 44.4% 1 3 33.3%
Other categories 0 0 0 0 0
Not specified/prefer not to say 0 0 0 0 0
White British or other White
(including minority-white groups) 4 44.4% 2 8 88.8%
Mixed/Multiple Ethnic Groups 1 11.1% 0 0 0
Asian/Asian British 1 11.1% 0 0 0
Black/African/Caribbean/Black British 0 0 0 0 0
Other ethnic group, including Arab 0 0 0 0 0
Not specified/prefer not to say 3 33.3% 2 1 11.1%
Diversity
Valuing D&I is an integral priority of the Company.
While the Board Diversity and Inclusion Policy
applies to the Board only, it sits alongside
the wider Company Diversity and Inclusion
Policy, setting out the Company’s broader
commitment to D&I. It is implemented, in part,
through the Code of Conduct programme.
The Board recognises the importance of D&I in
the boardroom and seeks to recruit directors
with varied backgrounds, skills and experience.
Reach seeks to broaden the diversity of
the Board to reflect its audience and their
communities. This will continue to be a
key consideration when appointing new
non-executive directors in the future.
As at 31 December 2023, the Company has
met the targets on Board diversity required to
be reported on under Listing Rule 9.8.6R(9)(a),
with 44.4% of Board members being women
(four of nine in total), the senior Board position
of senior independent director being held by a
woman, and two Board members being from
a minority ethnic background. In addition,
each of the Audit & Risk, the Remuneration and
the Sustainability Committee is chaired by a
woman and all of the non-executive directors
are members of all committees, therefore
reflecting the diversity of our Board.
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Board composition as at
31 December 2023
Gender breakdown as at
31 December 2023
Gender split of direct reports to the
Executive Committee
Board composition
Gender split of Group employees
Board gender diversity
Board tenure
Female
Male
Total
37
43
80
Chairman
Executive directors
Non-executive
directors
1
2
6
Female
Male
4
5
0-3 years
3-6 years
6+ years
5
3
1
Board skills and experience
70%
Media
Skill Number of directors
Digital transformation
Strategy and business
planning
Accounting and finance
People and talent
Sustainability/ESG
Technology/IT
Digital marketing/advertising
Data analytics
90%
90%
40%
90%
60%
40%
30%
40%
Board skills evaluation
The broad range of skills, experience and diversity of the Board that are relevant to Reach’s
strategy and business are illustrated above. This represents where the Board as at 5 March
2024 considers they have considerable or expert knowledge in the listed area.
Nomination Committee Report continued
6
3
.
7
%
(
9
3
)
3
6
.
3
%
(
5
3
)
3
3
.
3
%
(
3
)
6
6
.
7
%
(
6
)
6
1
.
0
%
(
2
,
1
6
7
)
3
9
.
0
%
(
1
,
3
8
4
)
Female
Male
1,440
2,266
E
x
e
c
u
t
i
v
e
C
o
m
m
i
t
t
e
e
S
e
n
i
o
r
m
a
n
a
g
e
r
s
O
t
h
e
r
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NON-EXECUTIVE DIRECTOR INDUCTION
A full, formal and tailored induction
programme is in place for new Board
members, to provide a comprehensive
induction to the Group and enable new Board
members to contribute to Board discussions
from the outset. The induction is designed to
cover a range of areas, including Board
procedures and listed company director
duties, the Group’s operational and financial
performance and strategic direction, and
key areas of the business.
Denise Jagger’s induction programme,
designed through discussion with the
Chairman and Company Secretary,
consists of:
• a series of in-depth meetings with other
Board members, Executive Committee
members and other senior leaders, such
as the Director of Investor Relations and
Director of Risk and Internal Audit;
• training about Board procedures and listed
company duties;
• a visit to the Newcastle hub;
• a visit to the Oldham print site;
• introductory meetings with our auditors
and lawyers advising on pensions matters;
• remuneration training delivered by FIT
Remuneration Consultants; and
• access to a comprehensive library
of internal and external papers and
presentations covering key functional
and operational areas of the Group.
You can read more about Denise’s views on
the induction programme on page 84.
Nick Prettejohn
Nomination Committee Chair
5 March 2024
Nomination Committee Report continued
Induction meeting attendees Meeting purpose
Chairman Introduction to the priorities of the Board and way of working,
ongoing matters considered by the Board, and the Group’s
governance structure.
Committee Chairs and other
non-executive directors
Introduction to the responsibilities and composition of the
Board’s Committees.
Executive directors Strategic priorities and direction of the Group, operational
and financial performance, and culture and purpose.
Executive Committee members Overview of their respective business area and current priorities.
Company Secretary Induction planning, duties and responsibilities of a listed company
director, and Market Abuse Regulation duties and responsibilities.
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As stated in the 2022 Annual Report, I took over
as Chair of the Sustainability Committee (the
Committee) at the end of 2022, so this report
marks my first full year in the role. I’m pleased
with the further progress we have made on
being a responsible, sustainable business that
aims to do things with integrity at all times.
One of my priorities as Chair this year has
been to work closely with management
outside the formal Committee meetings,
to support them in the development of the
sustainability strategy and ensure it aligns
with our purpose and business strategy.
Our main focus this year was to embed the
responsible business framework (please see
pages 30 to 53) that was developed and
approved at the end of 2022. The Committee
has discussed and received updates on work
being undertaken by the business under all
four pillars of the framework.
To keep pace with the fast-moving regulatory
landscape, the Committee and Executive
Committee undertook climate-related
training delivered by external experts.
Through this, we gained a broader
understanding of Scope 1, 2 and 3 greenhouse
gas (GHG) emissions and Reach’s full GHG
emissions breakdown including Scope 3,
types of science-based targets (SBTs) and
the SBTi requirements for target-setting.
In 2024, we’ll continue to hold management
accountable for delivery across the four
pillars, including overseeing and reviewing
quantitative and qualitative analysis of
progress. We’ll also continue our work in
order to be able to announce our net
zero commitment date in due course.
Following the news that the International
Sustainability Standards Board’s (ISSB)
disclosure standards for the UK are expected
to be endorsed by the Government during 2024,
the Committee will oversee the application of
the standards and any work required to be
undertaken to comply with them by the time
they are expected to come into force in 2025.
Priya Guha, MBE
Sustainability Committee Chair
5 March 2024
TO EMBED, REVIEW AND CHALLENGE
Priya Guha, MBE
Sustainability Committee Chair
Sustainability Committee Report
Role of the Committee
The role and responsibilities of the
Committee are set out in its terms of
reference, which are available on the
Company’s website at www.reachplc.com.
The role of the Committee is to:
• review, challenge, oversee and
recommend for Board approval
the sustainability strategy, and any
sustainability-related commitments
communicated externally in support
of the Group’s corporate purpose;
• embed, review, challenge, oversee
and support the sustainability strategy,
management initiatives and their
performance, to ensure a coherent and
consistent approach is adopted across
the Group;
• be responsible for the oversight and
review of relevant internal reporting
regarding the implementation of the
sustainability strategy;
• stay up to date with ESG best practice and
thought leadership, keeping under review
the extent and effectiveness of the Group’s
external reporting of relevant sustainability
performance, and its participation in
external benchmarking indices;
• consider the appropriateness of the
Group’s position on relevant emerging
sustainability issues; and
• be responsible for the oversight of diversity
and inclusion matters, people and
community engagement and monitoring
of corporate culture in support of the
Group’s purpose and values, reporting to
the Board on such matters as appropriate.
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Sustainability Committee Report continued
Committee membership
The members of the Committee are all
the non-executive and executive directors.
The Committee met twice during the year
and attendance is set out opposite.
Embedding our responsible
business framework
At the end of 2022, the Committee reviewed
and recommended for Board approval the
responsible business framework, which
formalised the Company’s sustainability
approach and key sustainability-related
disclosures. Key issues were grouped into
four pillars, creating a purpose-led
framework that is unique to our business.
This year, the Committee received updates on
work being undertaken by the business under
all four pillars of the framework. It has also
focused on embedding the framework and
assessing its alignment with our purpose and
business strategy, forming a strong foundation
for the ongoing evolution of our approach to
measuring and disclosing progress related
to being responsible and sustainable. Some
of the KPIs are reported in the Responsible
business section on pages 30 to 53. Additional
KPIs have been identified and will be kept
under review by the Committee for
consideration in future reporting.
For the pillar ‘Creating trusted, quality content’,
a Group-wide editor forum was established
in 2023, which meets every three months to
review and provide evidence of the positive
social impact the content of both our national
and regional brands have on society. The
Committee has received updates on the
highlights, which include campaigning against
injustice, striving to improve the common
good, lobbying to change laws and fight
inequity and promoting social good, inclusion
and diversity. You can read more about some
of our 2023 campaigns on pages 34 and 35.
For more information on our responsible
business framework, see page 30.
Task Force on Climate-related
Financial Disclosures
The Committee has been provided with
regular updates on the progress made
on climate strategy and the Task Force on
Climate-related Financial Disclosures (TCFD).
We carried out qualitative Climate Scenario
Analysis (CSA) in 2022 which identified three
key risks – flooding, carbon pricing and energy
pricing. In 2023, we completed further work to
quantify these risks by carrying out detailed
quantitative CSA. This has improved our
understanding of the risks and has started
to identify what the potential financial
implications on our business could be now
and in the future, as well as the resilience of
our strategy under multiple climate scenarios.
Committee membership
and attendance
Priya Guha, Chair from
31 December 2022
Anne Bulford
Darren Fisher
Steve Hatch n/a
Denise Jagger
Jim Mullen
Barry Panayi
Nick Prettejohn
Wais Shaifta
Olivia Streatfeild
The Committee has worked closely with the
Audit & Risk Committee on the quantitative
CSA work, with that committee being
responsible for risk management, including
climate-related risks, and for reviewing the
content and accuracy of our TCFD report.
Our TCFD report can be found on pages 54
to 64.
Setting our target for net zero
One key area of focus has been setting
greenhouse gas emission reduction targets
and the Committee has approved Reach’s
near-term science-based targets for Scope 1,
2 and 3 emissions.
We are now in the process of validating these
targets, in order to be able to announce a net
zero commitment date in due course.
More information can be found on page 48.
Priya Guha, MBE
Sustainability Committee Chair
5 March 2024
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Strategic Report Governance Financial Statements Other Information
During the year, the Audit & Risk Committee’s
(the Committee) core duties remained
unchanged. We continued to fulfil an
important oversight role, monitoring the
effectiveness of the Group’s system of internal
controls and risk management framework
and reviewing the integrity of the Group’s
financial reporting. The principal role of the
Committee is to help the Board to fulfil its
responsibilities and provide valuable
independent challenge around financial
reporting and financial controls. The Committee
also oversees the external auditor relationship.
Throughout the year, the Committee has
continued to review the Group’s principal risks,
particularly considering the evolving internal
and external environment, and performed
several in-depth reviews into principal risk areas.
This included reviewing the comprehensive
measures in place to protect the integrity and
reputation of Reach brands, which plays an
important part in maintaining audience trust
and the confidence of shareholders. The
Committee also reviewed how Reach had
approached its expansion into the US and the
risks related to the US business across various
areas such as tax, finance, HR, governance,
intellectual property and data.
AUDIT, RISK AND INTERNAL CONTROLS
Anne Bulford, CBE
Audit & Risk Committee Chair
Audit & Risk Committee Report
Role of the Committee
The role and responsibilities of the Committee
are set out in its terms of reference, which are
available on the Company’s website at
www.reachplc.com.
The key objectives of the Committee are to review
and report to the Board and shareholders on the
Group’s financial reporting, internal control and
risk management systems, and the independence
and effectiveness of the external auditors.
The Committee is also responsible for:
• monitoring the financial reporting process,
including the integrity of the financial
statements of the Company such as its
annual and half-year financial results;
• reviewing and assessing the Annual Report
to determine whether it can advise the Board
that, taken as a whole, the Annual Report is fair,
balanced and understandable;
• monitoring the statutory audit of the annual,
and the review of the half-year, consolidated
financial statements;
• reviewing significant financial reporting issues;
• recommending to the Board the appointment
of the external auditors and approving their
remuneration and terms of engagement;
• monitoring and reviewing the external
auditors’ independence, objectivity and the
effectiveness of the external audit process,
including considering relevant UK professional
and regulatory requirements such as the
appropriateness of the provision by the
auditors of non-audit services;
• monitoring and reviewing the effectiveness
of the internal control and risk management
systems, including the internal audit function;
and
• reviewing and approving the remit of the
internal audit function, ensuring it has
the necessary resources and can meet
appropriate professional standards for
internal auditors.
The Board’s responsibility for the assessment
of risk is delegated to the Committee.
The internal control environment has
been reviewed in depth. The Committee
has reviewed reports from internal audit and
overseen that, where appropriate, corrective
action is being taken to address any weaknesses
identified in those reports, to enhance the
internal control environment. During the year,
the Committee has continued to review
regular updates on ongoing work to
strengthen controls and governance.
In 2024, the Committee will maintain focus on
the ongoing work to strengthen controls and
governance arrangements. We have also
planned deep dives on information security,
data protection, supply chain and health
and safety.
Anne Bulford, CBE
Audit & Risk Committee Chair
5 March 2024
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Audit & Risk Committee Report continued
The Board has confirmed it is satisfied that the
members of the Committee are independent
and, as a whole, have competence relevant
to the sector in which the Group operates,
gained from their respective external roles,
previous and present. Committee member
biographies are set out on pages 76 to 78.
Anne Bulford, the Committee Chair, is considered
by the Board to have recent and relevant
financial experience for the purposes of the
Financial Reporting Council’s (FRC) 2018 UK
Corporate Governance Code (the 2018 Code).
At the invitation of the Committee Chair, the
Chairman, CEO and CFO, along with the Group
Financial Controller and the Director of Risk
and Internal Audit, attended all meetings
during the year to maintain effective and
open communications. The external auditors,
PricewaterhouseCoopers LLP (PwC), attend
meetings and have direct access to the
Committee should they wish to raise
any concerns outside the formal
Committee meetings.
reviewed and discussed a report from
management and concluded that the financial
statements can be prepared on a going
concern basis, and that there is a reasonable
expectation that the Group will be able to
continue operating and meet its liabilities
as they fall due over the next three years.
The directors assessed the prospects of
the Group over a three-year period, which
enabled them to consider the investment
required to drive growth in digital and the
impact of declining print revenues. The Group’s
going concern statement is set out on pages
149 and 150 and the viability statement is set
out on page 73 of the Strategic Report.
Interactions with the FRC
There have been no interactions with the
Financial Reporting Council (FRC) during 2023.
External auditors
Auditors’ appointment and independence
PwC was appointed by shareholders as the
Group’s statutory auditor in 2019 following
a formal tender process. The external audit
contract will be put out to tender every 10 years.
It is the Committee’s current intention to tender
its audit services by no later than 2028.
The lead audit partner at PwC is rotated at
least every five years to ensure continuing
independence. The new audit partner, Colin
Bates, has been in post since the start of 2021.
Committee membership
and attendance
Anne Bulford, Chair
Priya Guha
Denise Jagger
Steve Hatch
Barry Panayi
Wais Shaifta
Olivia Streatfeild
• reviewed the internal control environment
in depth and received regular updates on
ongoing work to strengthen controls and
governance arrangements in light of the
upcoming regulatory changes.
Annual Report
The Committee has undertaken a review and
assessment of the Annual Report to determine
whether it can advise the Board that, taken as
a whole, the Annual Report is fair, balanced and
understandable, and provides shareholders
with the information they need to assess the
Group’s position, performance, business model
and strategy.
In doing this, the Committee has:
• considered the results of an internal
review performed by a senior chartered
accountant not involved in the preparation
of the Annual Report;
• reviewed and discussed the findings from
the external auditors as part of the 2023
year-end audit; and
• fully discussed the Annual Report at the
Committee meeting in February 2024.
Following a robust process, the Committee
recommended to the Board that the Annual
Report, taken as a whole, is fair, balanced
and understandable.
Going concern and
viability statement
In its Annual Report, the Company is required
to include statements relating to going
concern and viability. The Committee
Time allocation
Financial reporting
External audit
Internal control,
risk management
and internal audit
Deep dives
Governance
26%
23%
24%
19%
8%
Committee membership
The members of the Committee are all
the independent non-executive directors.
The Committee met five times during 2023
and attendance is set out below.
How we used our meetings in 2023
In addition to planned activities and work,
the Committee:
• undertook a detailed review and scrutiny of
wider risk areas, with deep dives into cyber
security, data protection, brand reputation,
treasury management and future funding,
and a review of the US operations;
• reviewed TCFD compliance and its
application through the governance
framework, alongside the Sustainability
Committee; and
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PwC has indicated its willingness to continue
in office and shareholders’ approval will be
sought at the AGM on 2 May 2024.
The Company complied throughout the
year with the provisions of the Statutory Audit
Services Order 2014 relating to the UK audit
market for large companies. There are no
contractual obligations that restrict the
Company’s choice of external auditors.
During the year, private meetings were held
with PwC to ensure there were no restrictions
on the scope of their audit, and to discuss any
items that the external auditors did not wish
to raise with the executive directors present.
The Committee is satisfied that there are no
relationships between the Company and the
external auditors, its employees or its affiliates
that may reasonably be thought to impair the
external auditors’ objectivity and independence.
The Committee formally reviews the
effectiveness of the external auditors in
July each year and considers the results of a
survey sent to directors and senior managers,
including the Executive Committee and
members of the finance team. This survey
asks questions about independence, planning,
expertise and resources, the audit process,
communications and fees. A full report
of the survey results was reviewed by the
Committee, which concluded that the external
auditors’ performance remained effective.
The effectiveness review of PwC for the 2023
audit will be carried out in the coming months.
An example of the auditors demonstrating
their effectiveness this year was through
debate and challenge on key assumptions
within the impairment assessment, including
circulation decline and digital growth within
the Group’s financial projections from 2024
to 2033.
In addition, the effectiveness of the external
auditors is closely monitored on an ongoing
basis, and there is a regular cycle of meetings
between the Company and PwC where audit
planning and process are discussed, and any
issues can be raised. This includes monthly
meetings between the CFO and the lead
audit partner, and a meeting between the
Committee Chair and the lead audit partner
before each scheduled Committee meeting.
In audit periods, weekly meetings are held
between the finance team and PwC to discuss
progress on deliverables and resolve any
issues in real time.
Non-audit services
The Group has a formal policy on the
engagement and supply of non-audit
services, to protect the objectivity and
independence of the external auditors and
avoid a conflict of interest. The policy is in line
with the recommendations set out in the FRC’s
Guidance on Audit Committees and its 2019
Revised Ethical Standard. Generally, the
external auditors will not be engaged to
provide any additional services other than
audit-related services, including the review
of the interim financial information and
loan covenant reporting.
There may, however, be circumstances where
it could be in the Company’s and shareholders’
interests if the external auditors were engaged.
Such circumstances are likely to relate to
either exceptional transactions or those
deemed not to be of a material nature.
The Committee’s approval must be obtained
before the external auditors are engaged to
provide any permitted non-audit services,
which are detailed in the policy.
For permitted non-audit services that are
clearly trivial, the Audit & Risk Committee has
pre-approved the use of the external auditors,
subject to the following limits:
Value of service requested
Approval required prior
to engagement of the
external auditors
Up to £25,000 Chief Financial Officer
£25,001 to £50,000 Audit & Risk Committee
Chair
£50,001 and above Audit & Risk Committee
Where non-audit work is performed by
PwC, steps are taken to safeguard auditors’
objectivity and independence, including a
different team of people working on the task.
Details of the fees paid to PwC for the financial
period ending 31 December 2023 can be
found in note 6 to the consolidated financial
statements. In 2023, the approved non-audit fee
items provided by PwC related to the interim
review, loan covenant reporting and provision
of access to the PwC accounting website.
The spend in relation to these services was
£149,000 totalling 10.8% of the overall fees
paid. The Committee was satisfied that the
non-audit services purchased were in line
with the non-audit services policy and did not
compromise the independence of the auditors.
The Committee is satisfied that the Company
was compliant during the year with both the
2018 Code and the 2019 Revised Ethical
Standard, in respect of the scope and
maximum level of permitted fees incurred
for non-audit services provided by PwC.
Significant matters considered by
the Committee in relation to the
financial statements
The Committee has assessed whether
suitable accounting policies have been
adopted and whether management have
made appropriate estimates and judgements
on significant issues.
The Committee reviews accounting papers
prepared by management, which provide
details of the main financial reporting
judgements. The Committee also reviews
reports by the external auditors on the
full-year and half-year results, which highlight
any issues with respect to the work undertaken.
After receiving reports on the significant issues
and after discussion with PwC, the Committee
agreed that the judgements made by
management were appropriate.
Audit & Risk Committee Report continued
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The Committee considered the following significant issues in relation to the 2023 financial statements:
Critical estimate
or key judgement How the Committee addressed the issue
Impairment reviews
in respect of the
carrying value
of assets on the
consolidated and
parent company
balance sheets
The Committee received detailed papers from management in respect of the impairment reviews in relation to the carrying value of assets on the consolidated and
parent company balance sheets.
The Group’s consolidated balance sheet has material goodwill and other intangible assets (publishing rights and titles), and the parent company balance sheet has
material investment in subsidiary undertakings.
The Committee needed to assess whether the carrying value of assets of a cash-generating unit are impaired and are carried at no more than their recoverable amount
(the higher of fair value less costs of disposal and value in use) in the consolidated balance sheet.
The Committee also assessed whether the carrying value of investments are impaired and are carried at no more than the recoverable amount (the higher of fair value
less costs of disposal and value in use) in the parent company balance sheet.
The value in use has been calculated using a discounted cash flow model, and the fair value has been considered based on the value of the Group with costs of disposal
considered to be minimal.
The discounted cash flow model has been prepared based on the final budget for 2024, and then high level projections for the period 2025 to 2033. There are a number of
judgements made in setting the assumptions that underpin the model:
• the projections are management’s best estimate of the future performance of the Group which are subject to risk and uncertainties as set out in the Annual Report;
• the key assumptions in the projections relate to the continuation of print declines, of digital growth and the associated change in the cost base as a result of the
changing revenue mix;
• the long-term growth rate has been set at 0.9% (2022: 1%) from year 10;
• capital expenditure has been based on expected run rates of the existing business over the next 10 years;
• tax has been modelled based on the expected future tax rates at the balance sheet date; and
• the weighted average cost of capital post tax rate of 10.2% (2022: 10.8%) is calculated after due consideration of market factors impacting the rate and items that are
specific to the Group, such as the current capital structure and the best estimate of future movements in the capital structure.
The value in use from the discounted cash flow model is in excess of the carrying value of assets of the cash-generating unit resulting in no impairment (2022: nil) being
required in respect of the carrying value of assets on the consolidated balance sheet. Management also considered sensitivity scenarios which highlighted that no
impairment would be required.
The impairment review in respect of the carrying value of investments in the parent company balance sheet resulted in an impairment charge of £167.8m (2022: £65.1m).
The impairment review is highly sensitive to reasonably possible changes in key assumptions. The Committee noted that the Company has significant distributable
reserves of £522.0m (2022: £111.8m) following the capital reduction converting the entirety of the share premium account into distributable reserves, which provides
headroom relating to the Company’s ability to pay dividends.
Audit & Risk Committee Report continued
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Critical estimate
or key judgement How the Committee addressed the issue
Impairment reviews
in respect of the
carrying value
of assets on the
consolidated and
parent company
balance sheets
continued
The Committee members reviewed in detail the papers supporting the impairment review ensuring consistency with Board discussions relating to the budget and the
progress on the Customer Value Strategy which underpin the digital growth in the projections (all members of the Committee are Board members). The Committee also
reviewed the consistency of the current year model with the prior year model.
The external auditors challenged the conclusions and considered any external factors which may change the conclusions of the review. The external auditors also
undertook a detailed review of the assumptions and of the model supporting the papers.
In reaching its conclusion on the impairment review, the Committee considered the papers prepared by management and the external auditors. The Committee noted
the comparisons to external forecasts (which were supportive of the projections) and sensitivity analysis (which showed sufficient headroom of the carrying value of assets
in the consolidated balance sheet and an impairment of £167.8m in the parent company balance sheet).
The Annual Report contains disclosure of the Critical Judgements in applying the Group’s accounting policies, the key factors relating to the impairment reviews and the
conclusions reached (note 3 and note 16 in the notes to the consolidated financial statements, note 2 and note 4 in the notes to the parent company financial statements).
Impairment is not considered a principal risk for the Group, as identified on pages 68 to 72 of the Strategic Report, as it relates to historical transactions with no future cash
impact, nor is there any impact on the financial covenants for the Group’s debt facilities.
Consideration was also given to the continued adoption of the indefinite life assumption in respect of publishing rights and titles, and in assessing the publishing rights
and titles with reference to a single publishing cash-generating unit. The appropriateness of a single cash-generating unit for the publishing rights and titles:
The assumption is considered at each reporting date and is a Critical Judgement in applying the Group’s accounting policies.
The Group is a content business with content delivered through multiple brands. The brands have traditionally been in print and are transitioning to digital. The challenges
facing the brands have resulted in the Group becoming more integrated to such an extent that the interdependency of revenues across the network of brands is significant.
As such, assessing the publishing rights and titles with reference to a single publishing cash-generating unit, whose cash flows are interconnected, is deemed to be the
most appropriate treatment. There has been no change to the assessment of this Critical Judgement.
The indefinite life assumption in respect of publishing rights and titles:
The assumption is considered at each reporting date and is a Critical Judgement in applying the Group’s accounting policies.
The Group has, from first recognition to the latest results announcement, consistently adopted an indefinite life assumption for its publishing rights and titles. Indefinite life
intangible assets are not amortised. The Committee noted that indefinite is not the same as infinite (that is, limitless in extent). The brands have delivered trusted news to
readers for many years in print and more recently digital. The brands are core to our digital strategy, either directly or indirectly. In support of the assumption, management
have prepared 10-year illustrative projections which highlight that print will continue to be significant, and that digital will be increasingly significant. Based on the Group’s
strategic focus and the illustrative projections, it is considered that there is no foreseeable limit to the period over which the net cash inflows are expected to be generated
from the publishing rights and titles and that the current carrying value will be supported for the foreseeable future. As such, continuing to adopt the indefinite life assumption
in respect of publishing rights and titles is deemed to be the most appropriate treatment. There has been no change to the assessment of this Critical Judgement.
Audit & Risk Committee Report continued
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Critical estimate
or key judgement How the Committee addressed the issue
Pensions At each reporting date, the Group’s actuaries for this purpose, Willis Towers Watson (WTW), undertake a detailed calculation of the IAS 19 valuation of the Group’s defined
benefit pension schemes and of the specific financial disclosures in the financial statements.
The assumptions are agreed by management after taking advice from WTW. This includes external benchmarking of the key assumptions by WTW.
Independent investment manager confirmations are received for all investment assets and confirmation is received from the scheme administrators for all scheme
bank accounts.
An executive summary and a detailed report prepared by WTW setting out the methodology, judgements, assumptions and conclusions is presented to the Committee
for review. The assumptions regarding the discount rate, inflation rates and demographic assumptions are reviewed by the Committee.
The external auditors perform a detailed review of the reports prepared by WTW and of the methodology, judgements and assumptions used for the valuation, including
external benchmarking and testing in respect of the investment assets and bank accounts.
Full disclosure of the Group’s pension schemes including valuation, the approach to setting assumptions and the sensitivity to changes in key assumptions are disclosed
in note 21 in the notes to the consolidated financial statements.
Pension schemes are included in one of the Group’s principal risks that are set out in the risks and uncertainties section on pages 68 to 72 of the Strategic Report. This sits
under the wider lack of funding capability risk which sets out the pensions risk and mitigating management action.
Historical legal issues The Group is exposed to civil claims in relation to historical phone hacking. This is a standing item on the Board agenda and therefore is not specifically an agenda item
for the Committee. The Committee does assess the appropriateness of any provisions in relation to these matters and other implications on the consolidated financial
statements, and that the Annual Report contains sufficient disclosure of such matters, noting that there has been a material reduction in the provision following the High
Court’s judgment on time limitation during December 2023. Disclosures relating to the latest position are set out on page 27 of the Strategic Report and in note 27 in the
notes to the consolidated financial statements.
The external auditors’ report to the Committee details the procedures undertaken by them and their discussions with management, and this is discussed in detail by
the Committee.
Historical legal issues are included in one of the Group’s principal risks that are set out in the risks and uncertainties section on pages 68 to 72 of the Strategic Report.
This sits under the wider lack of funding capability risk which sets out the historical legal issues risk and mitigating management action.
Restructuring and
impairment
The Group has recorded significant restructuring and impairment charges in respect of the ongoing transformation programmes undertaken during the current year.
The Committee reviewed the reasonableness and inclusion of these items in operating adjusted items and the disclosures in the Annual Report.
Audit & Risk Committee Report continued
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Risk management
The Board is responsible for ensuring sound
internal control and risk management systems
are in place. During 2023, there was an ongoing
process for identifying, evaluating and managing
the significant and emerging risks faced by
the Company, including those exacerbated by
the current economic uncertainty. The process
is subject to regular review by the Board and
the Committee. The process accords with the
FRC’s Guidance on Risk Management, Internal
Control and Related Financial and Business
Reporting, as applicable for this financial year.
The Committee reviews the principal
risks, including descriptions of the risks, an
assessment of the impact on the business, the
probability of their occurrence, management
accountability and mitigating controls and
actions. During 2023, principal and emerging
risks were identified, assessed and reviewed
by impact and probability, and the Board
reconfirmed its view of the Group’s appetite
for risk and how this manifests itself in the
way the Group conducts its business.
During the year, further work was undertaken to
embed risk management within the business
and evolve how the Group mitigates and
manages principal risks, taking accelerated
action where required to respond to the
evolving internal and external environment.
Work was also undertaken to continue to
identify the Group’s top climate risks and
opportunities, plus further analysis to
understand these more fully and embed
them into our risk management model.
The Committee undertook a more detailed
review of several key risk areas during the year,
including cyber security, data protection, brand
reputation, treasury management and future
funding, and a risk review of the US operations.
The way the Company manages risk is set out
in the Strategic Report on pages 66 and 67,
with the key risks facing the Group and the
associated mitigating actions described
on pages 68 to 72.
Internal controls
The directors are responsible for the Group’s
established system of internal control and
for reviewing its effectiveness. The directors
confirm that the actions they considered
necessary have been or are being taken to
remedy any failings or weaknesses identified
from their review of the system of internal
control. This has involved considering the
matters reported to them and developing
plans and programmes that they consider
reasonable in the circumstances.
The changing internal and external
environment has led us to commit to
improving our internal control environment.
The Committee has received updates and
reviewed ongoing progress made throughout
the year on the work undertaken to enhance
our internal control environment.
The Board also confirms that it has not been
advised of material weaknesses in the part
of the internal control system that relates to
financial reporting. No system of internal
control can provide absolute assurance
against material misstatement or loss.
However, such a system is designed to provide
the directors with reasonable assurance that
problems are identified on a timely basis and
dealt with appropriately.
Although the Board has overall responsibility for
internal control, we acknowledge the positive
contribution made by senior management to
establish and develop internal controls within
the Group. In reviewing the effectiveness of
our system of internal controls, the Board has
considered several key elements, including
financial controls, investment controls,
management reporting and the various
review, steering, policy and Board committees.
The key procedures that have been established
and designed to provide effective internal
financial control are:
Financial reporting
Part of the budgeting, forecasting and
comprehensive management reporting
discipline involves the preparation of detailed
annual budgets and regular forecasts by the
business. These budgets and forecasts are
carefully examined by the executive directors
and then summarised and submitted to the
Board for approval. Weekly revenue and profit
forecasts are prepared and reported against
the approved budget and latest forecasts.
Weekly trading meetings are held to review
and discuss latest performance.
Consolidated monthly management accounts
– including detailed revenue and profit analysis
with comparisons to budget, latest forecasts
and prior year, and treasury, health and safety
and risk updates – are prepared, providing
relevant, reliable and up-to-date financial
and other information to the Board.
Investment appraisal
The Group has a well-defined framework
for capital expenditure, which is controlled
centrally. Appropriate authorisation levels
and limits are clearly established. There is
a prescribed format for capital expenditure
applications, which places a high emphasis
on the overall Group strategy or support for
the expenditure, and requires a comprehensive
and justified financial appraisal of the business
case being put forward.
All significant corporate acquisitions or
investments are controlled by the Board, or
a Board sub-committee, and are subject to
detailed investment appraisal and due diligence
procedures before the Board will approve them.
Additionally, an Investment Committee, which is
a management committee, is held every month
to review key business cases that management
has prepared.
Functional reporting
Several key functions – including treasury,
taxation, internal audit, risk management,
litigation, IT strategy and development,
environmental issues and insurance – are
dealt with centrally. Each of these functions
reports to the Board regularly, through the
CEO or CFO, as appropriate.
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Strategic Report Governance Financial Statements Other Information
The treasury function operates within the
terms of clearly defined policy statements.
The policy statements exist to ensure that the
Group is not exposed to any unnecessary risk
and that, where appropriate, there is hedging
against foreign currency and interest rate risks.
Effectiveness of risk management and
internal controls system
The Board has overall responsibility for the
Company’s system of risk management and
internal controls. In accordance with the 2018
Code, the Committee carries out a robust
assessment of the principal and emerging
risks. It also reviews the effectiveness of the
Company’s risk management and internal
control systems, covering all material
controls, including financial, operational
and compliance controls.
The Committee’s assessment includes a
review of the risk management process and the
principal and emerging risks and uncertainties.
As usual, the Committee reviewed reports
from the internal audit function in 2023, which
provided reasonable assurance that internal
control procedures remain in place and are
being followed. Formal procedures have been
established for taking appropriate action to
correct weaknesses identified from these
reports, and for enhancing the internal
control environment.
The Committee confirms that necessary actions
have been or are being taken where failings or
weaknesses were identified. The key risks and
uncertainties are set out on pages 68 to 72 of
the Strategic Report. The Committee considers
that the appropriate systems are in place,
adequate and operating properly.
The Committee also believes that the
Company’s Remuneration Policy is adequate
for a group of this size and nature and that
compensation policies and practices are
appropriate for maintaining a robust control
environment and do not put the Company
at risk.
Risk management and internal
controls compliance
Our risk management process and system
of internal control was operated through
the structure described here during 2023:
Group internal audit
The internal audit function focuses on
providing assurance about the design and
operating effectiveness of the internal control
system and enhancing the Group’s internal
controls. It has an annual plan based on a
rolling programme and specific risk-based
audits, which are approved by the Committee
every year. Internal audit sits independently
of the business, with no responsibility for
operational management.
The Director of Risk and Internal Audit oversees
an internal audit programme using in-house
resources and the services of external service
providers, as necessary. The internal audit
plan, being risk-based, is focused on those
areas deemed critical to achieving our
business objectives.
The Committee oversees the performance
of the internal audit function by having the
Director of Risk and Internal Audit attend
Committee meetings. In addition, a review of
the effectiveness of the internal audit function
was undertaken for the financial year.
The Committee concluded that the function
continues to operate effectively.
Risk management framework
The executive directors, assisted by the
Director of Risk and Internal Audit, oversee and
co-ordinate the risk management activities of
the Executive Committee.
The agreed objectives for the risk management
framework have been achieved during 2023
and all significant risks have been reviewed.
To enable consistent and focused monitoring,
reporting, evaluation and management of
significant Group risks, the executive director
owners of each key risk have reviewed and
documented the plans, actions and initiatives
that have taken place or are under way.
Year-end compliance reporting
A formal process exists for year-end compliance
reporting, requiring executive directors to confirm
their responsibilities for risk management and
internal control. Ultimate compliance reporting
is required of all Board members.
Steps have been taken to embed internal
control and risk management deeper into the
operations of the business and to deal with
areas for improvement that come to the
attention of management and the Board.
The Group’s systems of internal control are
designed to manage, rather than eliminate,
the risk of failure to achieve business
objectives, and can only provide reasonable
and not absolute assurance against material
misstatement or loss.
Whistleblowing charter
and procedure
The Group has a whistleblowing charter in
place and provides a confidential, independent
whistleblowing line where employees may
report any concerns about the integrity of the
business or breaches of the Group’s policies,
without fear of criticism or future discrimination.
The whistleblowing charter is supported by
an independent external service provider and
arrangements are overseen by the Director
of Risk and Internal Audit. The whistleblowing
charter is owned by the Committee with
oversight from the Board.
The Director of Risk and Internal Audit oversees
the investigation of all whistleblowing cases,
involving relevant resources as necessary. The
Committee Chair and the CEO are informed of
all cases as they arise. The Committee reviews
all information received to ensure the process
is working correctly.
Overall, we remain satisfied that the
whistleblowing policies and procedures are
robust and adequate. More information can
be found on page 38 of the Strategic Report.
Anne Bulford, CBE
Audit & Risk Committee Chair
5 March 2024
Audit & Risk Committee Report continued
103
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Strategic Report Governance Financial Statements Other Information
Our report is split into three parts: our Annual
Statement, including this foreword and our
2023 Remuneration at a glance summary
on page 106, the Policy Report and the
Annual Remuneration Report.
I thank our shareholders for their support on
remuneration matters at our 2023 Annual
General Meeting (AGM), when our 2022
Directors’ Remuneration Report was
approved by 90.45% of shareholders voting.
2023’s performance and
pay outcomes
As explained earlier in this Annual Report,
the Company’s 2023 focus on ’controlling
the controllables’ meant priority focus on
transforming our cost base and driving
efficiencies, while also accelerating digital
transformation through improved customer
engagement and diversified revenues. Despite
continued progress on digital transformation
and resilience in our print business, the 2023
Group adjusted operating profit did not reach
threshold levels sufficient to allow bonus
payments for our executive directors or wider
senior management group. Accordingly,
annual bonuses for 2023 were nil.
Similarly, no Long Term Incentive Plan
(LTIP) vested in respect of the Company’s
performance measured across the three
years to 31 December 2023, and these LTIP
awards which were made in 2021 will
accordingly lapse during 2024.
Renewing our Remuneration Policy
in 2024
Revised Remuneration Policy
At the 2024 AGM, we will ask shareholders
to renew the three-yearly authority for our
Directors’ Remuneration Policy (the Policy),
which was last approved at our AGM in 2021
(with 94.64% approval).
We propose to roll forward materially our
current Policy and retain the architecture of
our current incentive plans (the annual bonus
and LTIP). No increases in incentive quantum
are proposed. The Remuneration Committee
(the Committee) came to this decision after
thoroughly reviewing the continuing
appropriateness of the current Policy.
RENEWING OUR POLICY
Olivia Streatfeild
Remuneration Committee Chair
Our proposals include a limited number of
changes only, as described below:
• our shareholding guidelines for executive
directors will apply for two years from
stepping down from the Board
(increased from one year); and
• we will continue our practice since 2022 of
using a three-month average share price
to determine the number of shares used for
LTIP awards. This moderates the potential for
short-term share price volatility to impact
the number of shares in awards made
each year.
Operation of share plans in 2024
We are also proposing two changes in how
we operate our share plans for 2024.
First, we will seek our shareholders’ approval
at the 2024 AGM to operate our share plans
within the 10% in 10 years share plans dilution
limit only (removing the internal 5% in 10 years
limit for selective plans). The LTIP is our only
selective plan and there is a continuing
commercial need for Reach to offer the LTIP
each year to a broad population, which can
be over 40 people a year.
Remuneration Report
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Strategic Report Governance Financial Statements Other Information
Using our LTIP so broadly makes the 5% dilution
limit potentially constraining and, unless it is
removed, likely to inhibit our ability to make LTIP
awards to colleagues who have been making
important contributions to our business,
particularly the Company’s continuing
transformation into a customer-data-led
business. Accordingly, we view this proposed
change on share plans dilution limits as
important in supporting our Customer Value
Strategy. The wider colleague group who have
been included in the LTIP in recent years would
often expect to be included in equity plans as
part of their packages in competitor businesses
where their skills would be similarly in demand.
We remain committed to offering all-employee
share plans when we can do so within the 10%
share plans dilution limit.
The Company also intends to buy shares
into its employees’ share trust when it is
appropriate to do so to manage overall
dilution from share plans. Reach has made
such purchases in the past and would also
expect to make such purchases in future.
Secondly, we are revising the mix of performance
conditions for our LTIP awards in 2024. In 2023
the performance conditions were 75% relative
TSR and 25% Customer Value Strategy
measures, but in 2024 the weightings will be:
• Relative TSR – 40%
• Absolute TSR growth – 20%
• Customer Value Strategy metrics – 25%
• Environmental metrics, reductions in Scope 1
and Scope 2 emissions – 15%
The element of absolute TSR growth was
introduced to recognise the importance of
absolute shareholder value for our shareholders.
The growth range for this measure will be 10%
to 20% three-year compound annual growth
rate (CAGR). This will be measured from a
three-month base period to 31 December 2023
in which our average share price was 75.4p.
The new environmental performance conditions
for our 2024 LTIP reflect the importance which
Reach places on environmental matters. As
we explain in the Strategic Report, Reach has a
twofold responsibility: we promote awareness
of environmental issues across all of our
publications and we also seek to reduce the
negative impacts of our own operations on
the environment.
The metrics proposed for our 2024 LTIP are
aligned to Reach’s near-term science-based
targets for Scope 1 and 2 emissions in 2030.
These targets were approved by the Reach
Sustainability Committee in December 2023
and the measurement of progress against the
metrics will be subject to external verification.
I hope that our shareholders will remain
supportive of our approach to executive pay
at Reach and vote in favour of all of these
resolutions at our 2024 AGM.
The Committee welcomes all input on
remuneration matters so if you have any
comments or questions on any element of the
Directors’ Remuneration Report or the proposed
changes to our Directors’ Remuneration Policy,
please email me – care of Laura Harris,
Interim Group Company Secretary – at
company.secretary@reachplc.com. We are
grateful for the guidance and support we
have received from our shareholders on
remuneration matters in the past year.
Olivia Streatfeild
Remuneration Committee Chair
5 March 2024
Committee membership
and attendance
Olivia Streatfeild, Chair
Anne Bulford
Priya Guha
Steve Hatch, until
3 May 2023
Denise Jagger, from
31 December 2022
Barry Panayi
Nick Prettejohn
Wais Shaifta
Remuneration Report continued
Matters to be approved at our
2024 AGM
At the 2024 AGM, shareholders will be asked
to approve three resolutions related to
remuneration matters, which are:
• a resolution to approve the Directors’
Remuneration Report, which is the normal
annual advisory vote on this report;
• a resolution to approve the updated
Directors’ Remuneration Policy, which, as
explained above, is the normal three-year
vote on this matter; and
• a resolution to amend the share plan
dilution limits within the rules of the
Company’s LTIP as described above.
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Strategic Report Governance Financial Statements Other Information
2023 Single total figure of remuneration for executive directors (£’000)
Executive directors (£’000) Salary
Taxable
benefits
Pension
benefits Other
Single-year
variable
Multiple-year
variable Total
Jim Mullen 504 22 38 – – – 564
Darren Fisher 330 21 25 195
1
– – 571
1. Darren Fisher received a cash payment of £123,662 which was a buy-out of the value of Darren’s attained ITV 2022 cash bonus which was forfeited on his joining the Company. In addition a share award which was made
to buy-out a forfeited ITV share award vested on 6 June 2023 with a value of £70,910 (95,760 shares with a share price of £0.7405)
Summary of Remuneration Policy
Pay element Overview of Policy Remuneration in respect of 2023 Implementation of Policy in 2024
Base
salary
Reviewed annually, considering salary increases across the Group.
Increases not normally to exceed workforce increases
CEO, Jim Mullen = £504,425 (frozen for 2023)
CFO, Darren Fisher = £360,000
(from appointment in February 2023)
Salary review date is 1 April 2024. If the CEO and CFO
receive any salary increase, this will be in line with
workforce increases for 2024
Benefits Benefits typically consist of provision of a company car or car allowance,
private medical cover, permanent health insurance and life assurance
In line with Policy No change to benefits for 2024
Pensions 7.5% salary contribution level, with this rate being within the range of
contribution rates for the workforce (for which there are a large range
of legacy arrangements in place)
7.5% of base salary No change to pensions for 2024
Annual
bonus
Maximum annual bonus opportunity 125% of salary for CEO and 100% of
salary for CFO
Based on financial/business performance, with financial measures to be
not less than 50% of the total bonus opportunity
Any bonus up to 50% of salary is paid in cash, with the remainder delivered
in the form of deferred bonus share awards vesting after three years
Clawback provisions apply
Annual bonus for 2023 confirmed as nil
Performance measures for 2023 were fully
assessed on Group adjusted operating profit for
2023. Progress considered against a wider range of
factors (including Customer Value Strategy, diversity
and inclusion and cash management)
Maximum annual bonus opportunities remain at 125%
of salary for CEO and 100% of salary for CFO
Performance measures for 2024 will be similar to
2023. These are fully assessed on Group adjusted
operating profit. Progress will also be considered
on a wider range of factors
LTIP Annual awards of LTIP of 175% of salary for CEO and 150% of salary for CFO
in normal circumstances
Awards vest subject to performance over a three-year period. Vested
shares are subject to an additional two-year holding period
Malus and clawback provisions apply
Awards of 175%/150% of salary made to the CEO/CFO
Performance to be measured over the period
December 2022 to December 2025 against relative
TSR (75% weighting) and Customer Value Strategy
metrics (25%)
2021 LTIPs have nil vesting
No change to structure or quantum of LTIP for 2024
Performance to be measured over the period
January 2024 to December 2026 against relative TSR
(40% weighting), absolute TSR growth (20% weighting),
Customer Value Strategy metrics (25% weighting), and
ESG (Scope 1 and Scope 2 reduction) (15% weighting)
2023 REMUNERATION AT A GLANCE
Remuneration Report continued
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Strategic Report Governance Financial Statements Other Information
Pay element and how it supports strategy Operation Opportunity Performance conditions
Changes from
previous Policy
Base salary
To attract and retain talent
by ensuring base salaries are
competitive in the relevant
talent market
Base salaries are reviewed annually, taking
into account individual performance, market
competitiveness, the experience of each
executive director, and salary increases
across the Group
Any base salary increases are applied in line
with the outcome of the review
Percentage salary increases for executive
directors will not normally exceed those of
the wider workforce
Increases may be above this level if there
is an increase in the scale, scope, market
comparability or responsibilities of the role.
Where increases are awarded in excess of the
wider employee population, the Committee will
provide an explanation in the relevant year’s
Annual Remuneration Report
Individual and business performance are
considerations in setting base salary
No material
changes
Pensions
To provide post-retirement
benefits for participants in
a cost-efficient manner
Executive directors participate in the
Company’s defined contribution scheme
or receive a cash allowance in lieu
7.5% salary contribution level, with this rate
being within the range of contribution rates
for the workforce (for which there are a large
range of legacy arrangements in place)
None No material
changes
Remuneration Report continued
Introduction
This Directors’ Remuneration Report has been prepared in accordance with the provisions of the
Companies Act 2006 and Schedule 8 of the Large and Medium-sized Companies and Groups
(Accounts and Reports) Regulations 2008 (as amended).
The report meets the requirements of the FCA Listing Rules and the Disclosure Guidance and
Transparency Rules. In it, we describe how the principles of good governance relating to directors’
remuneration, as set out in the FRC’s UK Corporate Governance Code July 2018 (2018 Code), are
applied in practice.
Policy Report
Revised Directors’ Remuneration Policy table
As described earlier in this report, the Committee undertook a review of Reach’s Remuneration
Policy in 2023 and as confirmed below, no material changes are proposed to the Policy for the
next policy period which will apply from Reach’s 2024 AGM.
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Pay element and how it supports strategy Operation Opportunity Performance conditions
Changes from
previous Policy
Benefits
To provide non-cash benefits,
which are competitive in the
market in which the executive
is employed
Benefits typically include the provision of a
company car or car allowance, private medical
cover, permanent health insurance and life
assurance. Where appropriate, other benefits
may be offered including, but not limited to,
allowances for accommodation, travel,
relocation and participation in
all-employee share schemes
Benefits vary by role and individual
circumstances; eligibility and cost is
reviewed periodically
Relocation benefits may only be paid for
a maximum of two years
None No material
changes
Annual bonus
(delivered in the form of
cash and deferred shares)
To focus executive directors on
delivering the business priorities
for the financial year
Deferral of an element of bonus
outcomes in shares provides
further alignment with the
interests of shareholders
Performance measures, targets and weightings
are set at the start of the year. At the end of the
year, the Committee determines the extent to
which the targets have been achieved
For executive directors, any bonus earned
over 50% of salary is delivered in the form
of deferred bonus share awards
Deferred bonus share awards may not
normally be transferred or otherwise disposed
of by a participant for a period of three years
from the date of grant, and will be forfeited
on resignation to join a competitor
Clawback provisions apply as described in
the notes to this table
The maximum annual bonus opportunity will
be 125% of base salary for the CEO and 100%
of base salary for the CFO
For on-target performance, the bonus
opportunity is up to 50% of maximum
For threshold performance, the bonus
opportunity is up to 20% of maximum
Additional shares representing reinvested
dividends may be released following the
vesting of any deferred bonus share award
The performance conditions applied
may be financial or non-financial and
corporate, functional or individual, and
in such proportions as the Committee
considers appropriate
The performance conditions selected
may vary each year depending on
business context and strategy and will
be weighted appropriately according to
business priorities. Financial measures
will not be less than 50% of performance
measures for annual bonus in each year
of this policy
However, the annual bonus plan remains
a discretionary arrangement and the
Committee retains a standard power
to apply its judgement to adjust the
outcome of the annual bonus plan for
any performance measure (from zero
to any cap) should it consider that to
be appropriate
No material
changes
Remuneration Report continued
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Strategic Report Governance Financial Statements Other Information
Pay element and how it supports strategy Operation Opportunity Performance conditions
Changes from
previous Policy
Long Term Incentive Plan
To align the interests of executives
with shareholders in growing the
value of the business over the
long term
LTIP awards may be granted annually
There is a three-year vesting period subject to
continuing employment, and a further two-
year holding period for vested LTIP shares to
provide additional alignment with shareholders
Malus and clawback provisions apply as
described in the notes to this table
LTIP awards in normal circumstances are for
shares worth up to 175% of base salary for the
CEO and 150% of base salary for the CFO in
each year
Additional shares representing reinvested
dividends for the vesting period may be
released following the vesting of an LTIP award
The plan rules under which LTIP awards are
made provide for LTIP awards of up to 200%
of base salary in each year; however, the
Committee intends that this limit will be
used only in exceptional circumstances
In calculating the numbers of shares for LTIP
awards, the Company normally uses the
three-month average share price preceding
the award date
Performance conditions are reviewed
before each award cycle to ensure they
are appropriate and targets are set to
be appropriately stretching over the
performance period
The performance conditions applied
may be financial or non-financial and
corporate, functional or individual, and
in such proportions as the Committee
considers appropriate
However, the Committee would expect
to consult leading shareholders if it
proposed materially changing the current
performance conditions for LTIP awards
made to executive directors (relative TSR:
20%; absolute TSR growth: 25%; strategic
measures: 25%; ESG metrics 15%), or the
weightings between these measures
Performance periods will not be less than,
but may be longer than, three years
No more than 20% of awards vest for
attaining the threshold level of
performance conditions
The Committee also has a standard
power to apply its judgement to adjust
the formulaic outcome of any LTIP
performance measures (including to zero)
should it consider that to be appropriate
No material
changes
Clarified that
when calculating
the numbers
of shares for
awards, a
three-month
average share
price will be used
Remuneration Report continued
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Notes to the Policy table
1. Payments from existing awards
Executive directors are eligible to receive
payments from awards made prior to the
approval and implementation of the Policy
detailed in this report. Such payments may
not be within the scope of this Policy. Details
of these awards, if applicable, will be disclosed
in the Annual Remuneration Report.
2. Performance measure selection and
approach to target setting
The measures used under the annual
bonus plan are selected annually to reflect
the Company’s key strategic priorities for the
year and to reinforce Company performance.
Targets are set to reflect the need to support
performance in the short term while making
progress towards achievement of the Group’s
strategic objectives.
The Committee considers that the metrics
used in the LTIP help align executives with
shareholder interests, and provide objective
and transparent measures of the Company’s
performance and shareholder value.
3. Malus and clawback
The Committee may apply malus and
clawback to an LTIP award, to a deferred
bonus share award (malus only) and to
cash amounts under the annual bonus plan
(clawback only). The relevant circumstances
when malus and clawback can operate
are where:
• there has been a significant deterioration
in the underlying financial health of the
Company; or
• there has been a material misstatement
of the Company’s accounts; or
• the participant has deliberately misled the
Company, the Company’s shareholders
or the market regarding the Company’s
financial performance; or
• circumstances of significant reputational
damage (or potential damage) for any
Group company; or
• errors in assessment or calculation of
performance condition outcomes; or
• gross misconduct.
Malus can operate during the three-year
period until the vesting of a deferred bonus
share award. Malus and clawback can
operate from the award date until the end
of the two-year holding period for a vested
LTIP award. Cash bonuses can be subject to
clawback for up to three years from payment.
4. Travel and hospitality
While the Committee does not consider
travel and hospitality to form part of benefits
in the normal usage of that term, it has been
advised that corporate hospitality, whether
paid for by the Company or another, and
business travel for directors (and any related
tax liabilities settled by the Company) may
technically come within the applicable rules
and so the Committee expressly reserves
the right for the Committee to authorise such
activities and reimbursement of associated
expenses within its agreed policies.
5. Committee discretions
The Committee will operate the annual bonus
plan, the plan for awarding deferred bonus
share awards and the LTIP according to their
respective rules and the above Policy table.
The Committee retains discretion, consistent
with market practice, in a number of respects,
in relation to the operation and administration
of these plans. These discretions include, but
are not limited to, the following:
• the selection of participants;
• the timing of grant of an award/
bonus opportunity;
• the size of an award/bonus opportunity
subject to the maximum limits set out in
the Policy table;
• the determination of performance
against targets and resultant vesting/
bonus pay-outs;
• discretion required when dealing with
a change of control or restructuring of
the Group;
• determination of the treatment of leavers
based on the rules of the plan and the
appropriate treatment chosen;
• adjustments required in certain
circumstances (e.g. rights issues, corporate
restructuring events and special dividends);
and
• the annual review of performance
measures, weightings and targets
from year-to-year.
While performance measures and targets for
annual bonus and LTIP will generally remain
unchanged once set, the Committee has the
usual discretions to amend the measures,
weightings and targets in exceptional
circumstances (such as a major transaction)
where the original conditions would cease
to operate as intended. Any such changes
would be explained in the subsequent Annual
Remuneration Report and, if appropriate,
be the subject of consultation with the
Company’s major shareholders.
In any year where the Company is unable to
make an annual LTIP award due to corporate
activity, the Committee may use its discretion
to make that award in the following year in
addition to the normal annual award for
that following year.
Any use of these discretions would, where
relevant, be explained in the Annual
Remuneration Report.
Remuneration Report continued
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6. Shareholding guidelines
The policy on shareholding guidelines for
the executive directors can be summarised
as follows:
• executive directors are subject to a
guideline requirement of 200% of base
salary; and
• until the relevant shareholding levels are
acquired, executive directors are required to
retain 100% of shares vesting, after the sale
of sufficient shares to meet any income tax
or national insurance obligations, under all
share plan awards.
From the 2024 AGM, this guideline applies
additionally for a period of two years (an
increase from one year) from the date on
which an executive director stands down
from the Board. The requirement in these
circumstances is to retain shares with a value
equivalent to the lower of either: a) the 200% of
salary guideline; or b) the value of shares held
at the date of standing down from the Board.
This calculation excludes: a) shares purchased
by an executive director with their own funds;
b) shares obtained under awards granted at
recruitment to buy-out awards from a prior
employer; or c) shares from awards made
before the 2020 AGM (when a policy on
post-employment share ownership was
first introduced). Any shares obtained from
awards made between the 2020 AGM and
the 2024 AGM will be subject to the equivalent
requirement applying when those awards
were made (one year from the date of
standing down from the Board).
7. Differences in Remuneration Policy operated for other employees
Pay and employment conditions generally in the Group will be taken into account when setting executive directors’ remuneration.
The same reward principles guide reward decisions for all Group employees, including executive directors, although remuneration packages differ to
take into account appropriate factors in different areas of the business:
Base salary/benefits/
pension
The Committee receives and considers an annual report summarising the base salaries, benefits and pension
arrangements received by each category of Group staff
Annual bonus The majority of Group employees can participate in an annual bonus plan, although the quantum and balance of Group,
business unit and individual objectives varies by level and nature of role. The Committee receives an annual report
summarising the bonus potential and performance metrics used in each of the annual bonus schemes in operation
across the Group
Long-term incentives Key Group employees participate in the same share plan as is available to the executive directors (LTIP) and may receive
awards based on the same terms as for executive directors (although the Committee reserves the discretion to vary the
terms for awards made to employees below Board level). The Committee is responsible for approving all share awards
made to Group staff
The Company operates a SAYE all-employee share plan when considered appropriate to do so. All employees (including
executive directors) are given the opportunity to participate on the same terms when this plan is offered, reflecting HMRC
requirements and the limits specified by HMRC from time to time
Reflecting standard practice, the Company does not consult with staff in drawing up the Company’s Annual Remuneration Report or when
determining the underlying Policy.
Remuneration Report continued
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Strategic Report Governance Financial Statements Other Information
Recruitment Policy
External appointment
In cases of hiring or appointing a new executive director from outside the Company, the Committee
may make use of all existing components of remuneration, as follows:
Component Approach Maximum annual grant value
Base salary The base salaries of new appointees will be
determined based on the experience and skills
of the individual, internal relativities, relevant
market data and their current basic salary.
Initial salaries may be set below market and
consideration given to phasing any increases
over two or three years subject to development
in the role
Not applicable
Pension New appointees will be entitled to become
members of the Company’s defined
contribution pension scheme or receive
a cash alternative
7.5% of base salary
Benefits New appointees will be eligible to receive
benefits in line with the Policy
Not applicable
Annual bonus
(cash and
deferred bonus
shares)
The structure described in the Policy table
will apply to new appointees with the relevant
maximum being pro-rated to reflect the portion
of the year served
Up to 125% of base salary
for the CEO and 100% of
base salary for the CFO
LTIP New appointees will be granted LTIP awards on
similar terms as other executives, as described
in the Policy table
Up to 200% of base salary,
but normally 175% of base
salary for the CEO and 150%
of base salary for the CFO
In determining appropriate remuneration
structures and levels, the Committee will take
into consideration all relevant factors to ensure
that arrangements are in the best interests of
both the Company and its shareholders. The
Committee may make an award in respect
of a new appointment to ‘buy-out’ incentive
arrangements forfeited on leaving a previous
employer, i.e. over and above the approach
outlined in the prior table, and may exercise the
discretion available under Listing Rule 9.4.2 R if
necessary to do so. If making buy-out awards,
the Committee will consider relevant factors
including any performance conditions
attached to the forfeited awards, the likelihood
of those conditions being met and the
Remuneration Report continued
Executive directors’ service contracts
Name Date of contract
Date joined the
Reach plc Board
Notice period from
either party (months)
Jim Mullen 27 July 2019 16 August 2019 12 months
Darren Fisher 10 October 2022 1 February 2023 12 months
Non-executive directors’ letters of appointment
Name
Date of letter of
appointment
Date joined the
Reach plc Board
Notice period from
either party (months)
Nick Prettejohn 13 November 2017 6 March 2018 No prescribed period
Anne Bulford 17 June 2019 18 June 2019 3 months
Priya Guha 28 July 2022 1 September 2022 3 months
Denise Jagger 21 December 2022 31 December 2022 3 months
Barry Panayi 13 October 2021 13 October 2021 3 months
Wais Shaifta 28 July 2022 1 September 2022 3 months
Olivia Streatfeild 8 January 2016 15 January 2016 No prescribed period
proportion of the vesting period remaining.
The Committee will seek, as far as practicable,
to make any buy-out awards subject to
comparable requirements in respect of service
and performance as the awards forfeited. For
the avoidance of doubt, the value of buy-out
awards is not capped.
Internal promotion
In cases of appointing a new executive director
by way of internal promotion, the Recruitment
Policy will be consistent with that for external
appointees, as detailed above. Where an
individual has contractual commitments made
prior to their promotion to executive director
level, the Company will continue to honour
these arrangements.
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Exit payment policy
Each of the executive directors has a service
contract which can be terminated by either
party giving one year’s written notice.
The termination provisions of executive
directors’ service contracts provide that should
the Company seek to terminate an executive
director’s employment it may do so making
a payment in lieu of 12 months’ base salary.
Any payment in lieu will not include elements
relating to any bonus or benefits. The contract
provides that the Company may terminate in
breach of the agreement and may require the
director to mitigate any loss.
The Company may reimburse reasonable
legal costs incurred in connection with a
termination of employment, if the Committee
considers it appropriate.
Any new executive directors will be engaged
on these, or similar, contractual terms.
Executive director service contracts are
available for inspection at the registered
office and at the AGM.
In the event that a participant ceases to be an
employee of Reach, treatment of outstanding
awards under the Group’s incentive plans will
be determined based on the relevant plan
rules as summarised in the following sections.
Annual bonus plan – exit treatment
If an executive director resigns or is dismissed
for cause before the payroll cut-off date for
annual bonus payments the right to receive
any bonus normally lapses. If an executive
director ceases employment before such
date by reason of death, injury, ill health,
disability or any other reason determined by
the Committee, such bonus may be payable
as the Committee in its absolute discretion
determines, although normally such payment
will be pro-rated to reflect only the period
worked in the year. Similar treatment will
apply in the event of a change in control
of the Company.
Deferred bonus share awards –
exit treatment
Outstanding awards held by leavers will
normally continue to vest at the usual time,
unless the Committee exercises discretion to
allow early release in compassionate cases. In
cases of summary dismissal or the resignation
of a director to join a competitor, unvested
awards will lapse. On a change of control,
outstanding awards would normally vest.
LTIP awards – exit treatment
Unvested LTIP awards normally lapse unless
the participant is a good leaver. An executive
director will be considered a good leaver if
he/she ceases employment by reason of
death, injury, disability, ill health, redundancy,
retirement, transfer of an employing company
or business, or any other reason determined
by the Committee. In the case of a good leaver,
unvested LTIP awards will be retained and may
only vest in accordance with the performance
conditions at the end of the vesting period, but
will be pro-rated for time, subject to Committee
discretion to vary the time pro-rating formula if
considered appropriate. The Committee also
has discretion to allow earlier performance
condition assessment and release of time
pro-rated vested shares in exceptional cases.
Vested LTIP awards which are subject to an
additional holding period will typically be retained
and released at the end of the holding period,
subject to the Committee’s discretion to allow
release of the holding period in compassionate
cases. On a change of control, unvested LTIP
awards would normally vest immediately subject
to performance condition assessments and
be pro-rated for time, subject to Committee
discretion to vary the time pro-rating formula
if considered appropriate.
Remuneration Report continued
External appointments
The Company acknowledges that its executive
directors are likely to be invited to become
non-executive directors of other companies.
The Committee believes that these non-
executive duties can broaden the directors’
knowledge and experience to the benefit of
the Company. Executive directors are therefore,
with the Board’s permission, allowed to accept
one such appointment as long as there is
no conflict of interest and to retain any fees.
Details of external appointments are set out on
page 76 of the Governance Report and details
of any remuneration received in respect of
such positions is set out on page 120.
Consideration of conditions
elsewhere in the Company
The Committee does not currently consult with
employees specifically on the effectiveness and
appropriateness of the Directors’ Remuneration
Policy and framework. However, the Company
seeks to promote and maintain good
relationships with employee representative
bodies, including trade unions and staff forums,
as part of its employee engagement strategy
and consults on matters affecting employees
and business performance as required in each
case by law and regulation in the jurisdictions in
which the Company operates. The Committee
is mindful of the salary increases applying
across the Group when considering salary
increases for the executive directors.
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Remuneration Report continued
Pay element and function Operation Opportunity
Performance
conditions
Changes from
previous Policy
Company Chair
and non-executive
directors’ fees
To attract and retain
a company Chair and
non-executive directors
of the highest calibre
with broad commercial
and other experience
relevant to the
Company and sector
Fee levels are reviewed periodically
The fees paid to the Company Chair are determined by
the Committee and the fees paid to the non-executive
directors are determined by the Board
Additional fees are payable for additional Board
responsibilities such as acting as Senior Independent
Director and as Chair of the Audit & Risk, Sustainability
and Remuneration Committees
In exceptional circumstances, if there is a temporary
yet material increase in the time commitments for
non-executive directors, the Board may pay extra
fees to recognise the additional workload
When reviewing fee levels, time commitment,
responsibilities and the market positioning of fees
against sector comparators and FTSE-listed companies
of similar size and complexity are taken into account
However, the Company’s preferred way to consider
the appropriateness of any future reviews for Company
Chair and non-executive directors’ fee levels is to have
regards to percentage salary increases for the wider
workforce within Reach in any year
Any Company Chair and
non-executive director fee
increases are applied in line
with the outcome of the annual
fee review
There is no prescribed maximum.
Fees from 1 January 2024 are set
out in the Annual Remuneration
Report on page 119
The maximum aggregate annual
fee for all non-executive directors
provided in the Company’s
Articles of Association is £700,000
None No material
changes
Clarified the
Company’s
preference
to align fee
reviews with
percentage
salary
increases
for the wider
workforce
Notes:
While the Committee does not consider it to form part of benefits in the normal usage of that term, it has been advised that corporate hospitality,
whether paid for by the Company or another, and business travel for directors (and any related tax liabilities settled by the Company) may technically
come within the applicable rules and so the Committee expressly reserves the right for the Committee to authorise such activities and reimbursement of
associated expenses within its agreed policies.
Consideration of shareholder views
The Committee considers shareholder views
received during the year and at the AGM each
year, as well as guidance from shareholder
representative bodies more broadly, in shaping
remuneration policy. The Committee continues
to keep its remuneration arrangements under
regular review, to ensure it continues to reinforce
the Company’s long-term strategy and align
closely with shareholders’ interests. We consulted
with selected major shareholders regarding our
Directors’ Remuneration Policy to be brought
forward at the 2024 AGM.
Non-executive director
remuneration
Non-executive directors do not have service
contracts, but are engaged on the basis of
a letter of appointment. In line with the 2018
Code guidelines, all directors are subject to
re-election annually at the AGM. It is the policy
of the Board that non-executive directors
are not eligible to participate in any of the
Company’s bonus, long-term incentive or
pension schemes.
Details of the Policy on fees paid to our
non-executive directors are set out in the
following table. On any recruitment of a new
non-executive director, the Committee will also
apply this Policy.
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Scenario analysis
The charts that follow provide an estimate
of the potential future reward opportunities for
the executive directors, and the potential split
between the different elements of remuneration
under four different performance scenarios:
‘Minimum’, ‘On-target’, ‘Maximum’ and ‘Maximum
plus Growth’. Potential reward opportunities are
based on Reach’s Remuneration Policy, applied
to latest known base salaries and incentive
opportunities. Note that the LTIP awards granted
in a year do not normally vest until the third
anniversary of the date of grant.
The ‘Minimum’ scenario reflects base salary,
pension and benefits (i.e. fixed remuneration),
being the only elements of the executive
directors’ remuneration package not linked
to performance.
The ‘On-target’ scenario reflects ‘Minimum’
fixed remuneration as above, plus target bonus
(based on 50% of maximum opportunity) and
LTIP threshold vesting (20% vesting).
The ‘Maximum’ scenario reflects ‘Minimum’ fixed
remuneration, plus maximum payout under all
incentives. This could be lower than single figure
total remuneration which includes the value of
LTIP awards which vested based on the share
price at vesting (rather than grant).
The ‘Maximum plus Growth’ applies a 50% share
price growth factor to awards of LTIPs under the
‘Maximum’ scenario.
CEO (£'000)
CFO (£'000)
Minimum On-target
3,000
2,500
2,000
1,500
£564
£1,056
17%
30%
53%100%
£2,519
18%
35%
25%
22%
1,000
500
Fixed pay
Variable pay
LTIPs
+50% share price
Maximum
plus Growth
£2,519
18%
35%
25%
22%
Maximum
£2,079
43%
30%
27%
Minimum On-target Maximum
plus Growth
2,000
1,500
£409
£697
15%
26%
59%100%
£1,579
17%
34%
23%
26%
Maximum
£1,309
41%
28%
31%
1,000
500
Fixed pay
Variable pay
LTIPs
+50% share price
Remuneration Report continued
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Remuneration Report continued
Annual Remuneration Report
The following section provides details of how the current Policy was implemented during 2023.
References to 2023 or any other year in the Annual Remuneration Report (unless otherwise stated)
refer to a calendar year (1 January to 31 December inclusive).
The Remuneration Committee is a committee of the Board of directors and has been established
with formal terms of reference approved by the Board. The Committee’s purpose is to help the
Board fulfil its oversight responsibility by ensuring that Reach’s Remuneration Policy and practices
reward fairly and responsibly, link to corporate and individual performance, and take account of
the generally accepted principles of good governance. A copy of the terms of reference
is available on the Company’s website at www.reachplc.com.
The Committee fulfils its duties with a combination of formal meetings and informal consultation
with relevant parties internally. During the year, the Committee, where appropriate, sought advice
and assistance from the executive directors and the Group HR Director in connection with carrying
out its duties. The activities of the Committee include appropriate review and oversight of the
operation and implementation of the Company’s Remuneration Policy each year. The Committee
also reviewed its terms of reference in the year.
The Chairman of the Board, together with the CEO, is responsible for evaluating and making
recommendations to the Board on the remuneration of the non-executive directors. Members of
the Committee and any person attending its meetings do not participate in any decision on their
own remuneration.
The Committee met five times during the year, and details of members’ attendance at meetings
are provided on page 81 of the Governance Report and page 105 of this Remuneration Report.
During the year, the Committee considered its obligations under the 2018 Code and concluded that:
• the Directors’ Remuneration Policy supports the Company’s strategy, including the performance
measures chosen; and
• remuneration for our directors remains appropriate.
In addition, the Committee has ensured that its policy and practices are consistent with the six
factors set out in Provision 40 of the 2018 Code:
Clarity – our Policy is well understood by our senior executive team and has been clearly
articulated to our shareholders and representative bodies.
Simplicity – the Committee is mindful of the need to avoid overly complex remuneration
structures that can be misunderstood and deliver unintended outcomes. Therefore, a key
objective of the Committee is to ensure that our executive remuneration policies and practices
are straightforward to communicate and operate. We operate one annual bonus and one senior
executive share plan across all our senior team.
Risk – our Policy has been designed to ensure that inappropriate risk-taking is discouraged
and will not be rewarded, through: 1) the balanced use of both annual incentives and LTIPs; 2)
the significant role played by shares in our incentive plans, together with bonus deferral and
in-employment and post-cessation shareholding guidelines; and 3) malus and clawback
provisions within all our incentive plans. The Committee reviews the overall appropriateness
of all incentive plan outcomes before they are confirmed, and any risk-related concerns can
be considered during that review.
Predictability – our incentive plans are subject to individual caps, with our share plans also
subject to appropriate share plans dilution limits. The weighting towards use of shares within
our incentive plans means that actual pay outcomes are highly aligned to the experience of
our shareholders.
Proportionality – there is a clear link between individual awards, delivery of strategy and our
long-term performance. In addition, the significant role played by incentive/‘at risk’ pay, together
with the structure of the executive directors’ service contracts, ensures that poor performance is
not rewarded. Both post-vesting holding periods for LTIP awards and deferral of annual bonus
ensures that rewards at Reach are aligned with longer-term shareholder experience.
Alignment to culture – our executive pay policies are fully aligned to Reach’s culture through the
use of metrics in both the annual bonus and the application of performance conditions for LTIPs.
These metrics consider how we perform against key aspects of our strategy.
The Company engages in collective bargaining on pay for those areas in the business where
there are agreements to do so. The members of the Committee (as full Board members) are
kept informed on these engagements.
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We consider that our executive directors’ pay is shown to be aligned to wider Company pay policy
through the consistency of approach taken on base salary increases and annual bonus measures.
Before proposing the revised and updated Directors’ Remuneration Policy which is being presented
at the 2024 AGM, the Company engaged with some of its major shareholders with regards to the
continued appropriateness of our Policy.
Advisers
The Committee evaluates the support provided by its advisers annually to ensure that advice is
independent, appropriate and cost-effective. The Committee retains responsibility for appointing
any consultants in respect of executive director remuneration.
The Committee received advice from FIT Remuneration Consultants LLP (FIT) in 2023. FIT was
appointed by the Committee in 2019 following a competitive tender process. FIT also provided
share plan implementation advice to the Company during the year. The Committee reviewed the
advice provided to it and is satisfied that the advice received from FIT in 2023 was independent
and objective. FIT does not have any connection with the Company or its directors.
Summary of shareholder voting on remuneration matters
The table below shows the results of the votes on: (1) the Directors’ Remuneration Policy at the
2021 AGM; and (2) the advisory vote on the 2022 Directors’ Remuneration Report at the 2023 AGM.
Resolution text Votes for % for Votes against % against Total votes cast
Votes
withheld
(1) Approve the Directors’
Remuneration Policy 239,993,386 94.64 13,592,059 5.36 253,585,445 17,272
(2) Approve the Directors’
Remuneration Report 212,391,939 90.45 22,430,699 9.55 234,822,638 100,410
Single total figure of remuneration for executive directors (audited)
The table below sets out a single figure for the total remuneration received by each executive director for the years ended 31 December 2023 and 31 December 2022.
Salary
£’000
Taxable benefits
£’000
Pension benefit
£’000
Total fixed
remuneration £’000
Other
£’000
Single-year
variable £’000
Multiple-year
variable £’000
Total variable
remuneration £’000
Total
£’000
Executive 2023 2022 2023 2022 2023 2022 2023 2022 2023
2
2022 2023
3
2022
3
2023 2022
4
2023 2022 2023 2022
Jim Mullen 504 501 22 22 38 38 564 561 – – – – – – – – 564 561
Darren Fisher
1
330 – 21 – 25 – 376 – 195 – – – – – – – 571 –
1. Darren Fisher was appointed as CFO on 1 February 2023
2. Darren Fisher received a cash payment of £123,662 which was a buy-out of the value of Darren’s attained ITV 2022 cash bonus which was forfeited on his joining the Company. In addition a share award which was made to
buy-out a forfeited ITV share award vested on 6 June 2023 with a value of £70,910 (95,760 shares with a share price of £0.7405)
3. Annual bonus for 2023 was nil (2022: nil)
4. Jim Mullen asked that his March 2020 LTIP would not vest and this award was cancelled. As at the date this award would have vested (27 March 2023), the value of this award was £264,827
Remuneration Report continued
FIT’s total fees for the provision of remuneration services to the Committee in 2023 were £89,200 plus
VAT. These fees were charged on the basis of FIT’s normal terms of business for advice provided.
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PENSIONS (AUDITED)
For both Jim Mullen and Darren Fisher, this item applied a 7.5% pensions contribution rate
throughout the year to paid salary (see page 106).
Neither of the executive directors participated in any of the Group’s defined contribution or defined
benefit pension schemes. Each executive director received the above as an annual cash sum to
use for pension purposes.
SINGLE YEAR VARIABLE (AUDITED)
The 2023 annual bonus was based entirely on the achievement of Group adjusted operating profit.
As the threshold level of Group adjusted operating profit was not attained, the outcome was nil.
Measure
Weighting
(% of bonus) Threshold Stretch Actual
Total payout
(% of maximum)
Group adjusted operating profit 100%
£103.0m
(Nil)
£116.0m
(100%)
£96.5m
Nil
Total Nil
2021 LTIP AWARDS (AUDITED)
Details of the performance metrics applying for the 2021 LTIP awards, the performance period for
which ended in December 2023, are summarised below. As noted in the Committee Chair’s
introduction on page 104, the vesting level was nil.
Vesting of the 2021 LTIP award was dependent on achieving relative TSR (70% weighting) and
Cumulative Net Cash Flow performance measures (20% weighting), and Overall Digital Average
Revenue Per User (ARPU) (10% weighting) as follows:
TSR performance relative to constituents of FTSE SmallCap (ex. IT) % of award that can be exercised
Upper quartile or above 70%
Between median and upper quartile Straight-line vesting between 14% and 70%
Median 14%
Below median Nil
TSR performance was measured using a three-month average period at the start and end of the
three-year performance period. The Company’s ranking was below median, which warranted nil
vesting of the TSR shares.
Cumulative Net Cash Flow over the performance period % of award that can be exercised
£395m (or above) 20%
Between £345m and £395m Straight-line vesting between 4% and 20%
£345m 4%
Below £345m Nil
Cumulative Net Cash Flow was measured over financial years 2021, 2022 and 2023. However,
the Cumulative Net Cash Flow attained was £224.1m and so was below the £345m threshold.
Accordingly, there was nil vesting of the Cumulative Net Cash Flow shares.
Cumulative Net Cash Flow for the 2021 award was defined as the net cash flows generated by the
business before the payment of dividends, pension deficit funding and associated tax relief, and
the cost of acquisitions, and before any significant cash outflows that have been treated as
non-recurring in the financial statements.
Remuneration Report continued
SALARY (AUDITED)
The salary review date in the year was 1 April 2023. The CEO did not receive a salary increase in
2023. The CFO’s salary applied from appointment.
Salary until
31 March 2023
Salary from
1 April 2023 % increase
Jim Mullen £504,425 £504,425 0%
Darren Fisher £360,000 £360,000 0%
TAXABLE BENEFITS (AUDITED)
This item relates to the provision of car allowance and healthcare cover.
Car allowance
Value of
healthcare cover
Jim Mullen £20,000 £2,454
Darren Fisher £18,333 £2,254
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Single total figure of remuneration for non-executive directors (audited)
The table below sets out a single figure for the total remuneration received by each non-executive
director for 2022 and 2023.
Base fee
£’000
Other fees
£’000
Total
£’000
2023 2022 2023 2022 2023 2022
Anne Bulford 52 49 13 13 65 62
Priya Guha
1
52 17 13 – 65 17
Steve Hatch
2
17 49 – – 17 49
Denise Jagger
3
52 – 13 – 65 –
Barry Panayi 52 49 – – 52 49
Nick Prettejohn 185 183 – – 185 183
Wais Shaifta
1
52 17 – – 52 17
Olivia Streatfeild 52 49 13 13 65 62
1. Priya Guha and Wais Shaifta joined the Board on 1 September 2022
2. Steve Hatch stepped down from the Board on 4 May 2023
3. Denise Jagger joined the Board on 31 December 2022
The non-executive director fee rates below were in place during 2023.
Chairman base fee £185,400
Non-executive director base fee £52,000
Additional fee for Senior Independent Director £12,500
Additional fee for chairing Audit & Risk Committee £12,500
Additional fee for chairing Remuneration Committee £12,500
Additional fee for chairing Sustainability Committee £12,500
The aggregate remuneration of all executive and non-executive directors under salary, fees,
benefits, cash supplements in lieu of pensions and annual bonus in 2023 was £1.63 million
(2022: £1.57 million).
LTIP interests awarded in 2023 (audited)
On 13 April 2023, Jim Mullen and Darren Fisher were granted awards under the LTIP. To the extent
that performance conditions are met, these awards will vest on 13 April 2026. The three-year
period over which performance is to be measured is from 26 December 2022 to 31 December
2025. Vested shares are subject to a two-year holding period.
Date
of grant
Shares over
which awards
granted
1
Value
of awards
granted (£)
% of
salary
Jim Mullen 13 April 2023 1,040,970 £882,743 175
Darren Fisher
2
13 April 2023 582,708 £494,136 137
1. The base price for calculating the level of awards was £0.848, the three-month average share price to the
date of grant. The share price on 13 April 2023 was £0.758, and so using £0.848 reduced the number of shares
in 2023 LTIP awards
2. Darren Fisher’s award was pro-rated in 2023 to reflect his starting date of 1 February 2023
Vesting of LTIP awards granted (as nil-cost options) in 2023 is subject to three performance
conditions: relative TSR, representing 75% of each award, three-year Overall ARPU for 12.5% and
revenue per thousand page views (RPM) 12.5%.
Remuneration Report continued
The Customer Value Strategy metrics applied for 2021 LTIPs considered Overall ARPU with the
following scale, measured to the end of financial year 2023. Overall ARPU is defined as the total
digital revenue generated across the business, divided by the active UK digital audience (based
on the accepted industry measurement standard). The ARPU figure attained was £3.05, and there
was nil vesting of the ARPU shares.
ARPU (£) % of award that can be exercised
£4.57 (or above) 10%
Between £4.35 and £4.57 Straight-line vesting between 7.33% and 10%
Between £3.91 and £4.35 Straight-line vesting between 2% and 7.33%
£3.91 2%
Below £3.91 Nil
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More details of the targets applying to these awards are included in the tables below.
Relative TSR condition (75% weighting)
TSR performance relative to constituents of FTSE SmallCap (ex. IT) % of award that can be exercised
Upper quartile or above 75% (100% of this part)
Between median and upper quartile Straight-line vesting between 15% and 75%
Median 15% (20% of this part)
Below median Nil
In addition, for this part of an award to become exercisable, the Committee must be satisfied that
the Company’s TSR performance is a genuine reflection of the underlying business performance
of the Company over the performance period.
When making this assessment, the Committee will consider factors including revenues, free cash
flow and change in net debt, as well as the Company’s TSR performance over the period. The
Committee will be guided in its assessment by a review of performance against these metrics,
based on the audited results, which it will undertake prior to vesting. The Committee will consider
both a quantitative and qualitative analysis of the performance and consider any relevant
internal and external factors to help ensure that unexpected events during the period are
considered properly.
ARPU condition (12.5% weighting) and RPM condition (12.5% weighting)
ARPU is defined consistently with the definition for this measure on page 119, with the targets for
2023 LTIP awards being by reference to ARPU for 2025. RPM is defined as the total worldwide digital
revenue generated across the business during a specified period, divided by the total number of
worldwide page views (measured in thousands).
In line with other conditions, 20% will vest for achieving threshold and full vesting for achieving
maximum target.
The Committee regards ARPU targets and RPM targets for the 2023 LTIP awards as commercially
sensitive at the current time, and accordingly will not be disclosing these targets on a prospective
basis. This information will be disclosed when it is appropriate to do so, and not later than the
publication of the Annual Remuneration Report for the year of vesting.
Buy-out awards made to the CFO in 2023 (audited)
On 6 June 2023, the Company granted nil-cost options to Darren Fisher which were a buy-out
of share awards from his former employer (ITV) previously held by Darren Fisher and that were
forfeited on his joining the Company. The buy-out awards will vest on the original vesting dates
of the forfeited awards, subject to Darren’s continued employment with Reach up to the relevant
vesting dates. The forfeited awards were awards in respect of deferred bonus or restricted share
awards in ITV and had no pre-vesting performance conditions.
The number of shares under the buy-out awards were equivalent in value to the awards forfeited,
calculated using a three-month average share price of £0.7771 per share.
Shares over which awards granted Year of vesting
95,760 2023
61,164 2024
80,816 2025
77,360 2025
79,566 2026
Payments for loss of office (audited)
In the 2022 Directors’ Remuneration Report we disclosed the remuneration-related arrangements
for Simon Fuller stepping down as our CFO on 31 December 2022. In 2023, Simon received fixed pay
(base pay, pension and benefits) in line with contractual entitlements whilst on garden leave until
10 October 2023 (£351,584). Following the 2023 financial year end, Simon Fuller’s 2021 LTIP award
(which had been retained on a time pro-rated basis) lapsed in full.
Payments to past directors (audited)
There were no payments to past directors in the year.
External directorship fees
As set out in the Remuneration Policy, the Company recognises the benefits of executive directors
taking on external appointments as non-executive directors. Jim Mullen serves as a non-executive
director of Racecourse Media Group Limited. For 2023, he received fees of £40,000, which he retained.
Remuneration Report continued
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Annual percentage change in remuneration of directors and employees
The table below shows the percentage change in CEO remuneration from the prior year, compared to the average percentage change in remuneration for all other employees. In accordance with
Schedule 8 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (as amended), we also show the relevant percentage changes for all other directors and
figures are shown for 2020 through to 2023. Over time, five years’ worth of data will be shown.
The CEO’s remuneration includes base salary paid in 2023, taxable benefits and bonus. The base salary and taxable benefits for all other employees is calculated using the increase in the earnings of
employees taken from salary (as at the end of the year and the end of the previous year) and payroll and P11D data from the relevant tax years. It excludes any discount from participation in the Reach
Savings-Related Share Option Scheme.
The table is based on a consistent set of employees, that is, the same individuals appear in both years’ populations but there are now four years and people may have left. The annual bonus is the
amount payable in respect of 2023 compared to the amount paid in respect of 2022. The base salary data for part-time employees has been pro-rated up to the full-time equivalent.
Jim Mullen
CEO
All other
employees
5
Darren
Fisher
CFO
6
Nick
Prettejohn
Chairman
Anne
Bulford
Non-
Executive
Director
7
Priya Guha
Non-
Executive
Director
8
Steve Hatch
Non-
Executive
Director
9
Barry Panayi
Non-
Executive
Director
10
Wais Shaifta
Non-
Executive
Director
9
Olivia
Streatfeild
Non-
Executive
Director
2023
1,2
Salary 0.6% 5.4% n/a 1.1% 4.8% 282.4% (65.3%) 6.1% 205.9% 4.8%
Taxable benefits 0.0% 7.0% n/a n/a n/a n/a n/a n/a n/a n/a
Annual bonus
3
0.0% 0.0% n/a n/a n/a n/a n/a n/a n/a n/a
2022
Salary 2.7% 6.3% n/a 1.7% 6.9% n/a 8.9% 390.0% n/a 21.6%
Taxable benefits (12.0%) 10.7% n/a n/a n/a n/a n/a n/a n/a n/a
Annual bonus
3
(100%) (100%) n/a n/a n/a n/a n/a n/a n/a n/a
2021
Salary 13.2% 3.8% n/a 11.8% 13.7% n/a 12.5% n/a n/a 27.5%
Taxable benefits 13.6% (0.3%) n/a n/a n/a n/a n/a n/a n/a n/a
Annual bonus 100% 100% n/a n/a n/a n/a n/a n/a n/a n/a
2020
Salary
4
(14.8%) 4.2% n/a (10.6%) 112.5% n/a (11.1%) n/a n/a (11.1%)
Taxable benefits nil 2.9% n/a n/a n/a n/a n/a n/a n/a n/a
Annual bonus
3
(100%) (100%) n/a n/a n/a n/a n/a n/a n/a n/a
All figures are expressed as percentage changes from the prior year
1. Please see the single total figure of remuneration tables for both the executive
directors and non-executive directors
2. Annual reviews from 1 April each year produce year-on-year changes and
for non-executive directors, differentials can reflect changes in committee
chair responsibilities
3. The annual bonus for 2023 was nil, the annual bonus for 2022 was nil and the
annual bonus for 2020 was cancelled
4. The voluntary salary reduction in 2020 for all directors impacts differentials for
2020 and 2021
5. There are no other employees of the listed parent and, as such, the all
employees (of the Group) measure is a more appropriate comparable
6. Darren Fisher was appointed as Chief Financial Officer on 1 February 2023.
n/a has been included as Darren has no prior year data for the purposes of
a comparison
7. Anne Bulford was appointed as a non-executive director on 18 June 2019.
Accordingly, the percentage difference in 2020 shown represents a comparison
between a full year (2020) and a part year (2019)
8. Priya Guha and Wais Shaifta were appointed as non-executive directors on
1 September 2022. Accordingly, the percentage difference in 2023 shown
represents a comparison between a full year (2023) and a part year (2022)
9. Steve Hatch stepped down from the Board as a non-executive director
on 3 May 2023
10. Barry Panayi was appointed as a non-executive director on 13 October 2021.
Accordingly, the percentage difference in 2022 shown represents a comparison
between a full year (2022) and a part year (2021)
Denise Jagger was appointed as a non-executive director on 31 December 2022.
She is not included in the table above for 2023 because Denise has no prior
year data for the purposes of a comparison. Simon Fuller, David Kelly and Helen
Stevenson all left the Board on 31 December 2022 and have not been included in
this table.
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Strategic Report Governance Financial Statements Other Information
Chief Executive Officer pay ratio
The table below shows the ratio of the CEO’s single figure total remuneration to the total
remuneration for the median (50
th
percentile), 25
th
and 75
th
percentile paid employee.
Year Method
25
th
percentile
pay ratio
Median pay
ratio
75
th
percentile
pay ratio
2018 Option B 38:1 27:1 18:1
2019
1
Option B 43:1 31:1 24:1
2020 Option B 17:1 14:1 11:1
2021 Option B 59:1 53:1 41:1
2022 Option B 18:1 16:1 10:1
2023 Option B 17:1 14:1 9:1
1. The CEO single figure total remuneration for 2019 was determined by adding together Simon Fox and
Jim Mullen’s single figures of total remuneration as disclosed in the single figure table for that year
The ratios are calculated using Option B methodology set out in the remuneration regulations. This
was considered the optimum approach utilising data compiled for annual gender pay reporting
which provides a robust set of data to refer to in order to identify representative employees in the
organisation at median, lower quartile and upper quartile. Our preference is to have a consistent
reporting reference date.
The median, 25
th
and 75
th
percentile employees were identified from the list of full pay relevant
employees in the organisation on 5 April 2023 and where the individuals were also in employment
at full year end in December 2023. The total compensation figure was then calculated and
checks made to ensure the employees identified are representative of pay at these levels in the
organisation. The data points are reflective of our Company structure and types of roles across
the organisation and accordingly the Committee believes the median pay ratio for 2023 to be
consistent with the pay, reward and progression policies for the Company’s UK employees taken
as a whole as at the reference date.
The median pay ratio for 2023 is slightly lower than the figure reported for 2022 where in both
years Group bonuses were not payable and there was no LTIP benefit for the CEO. The ratio
has been significantly higher in years when bonus has paid out and LTIP vested positively.
As the CEO pay ratio will involve the inclusion of variable pay outcomes for any year, it is
reasonable to expect the ratio to vary from year to year. However, the Committee will take
employee pay arrangements into account when setting the pay of our executive directors for any
year, and is committed to paying our directors appropriately and in line with Company performance.
Supporting data compensation figures 25
th
percentile Median 75
th
percentile
Total employee pay and benefits figure £32,767 £41,611 £59,758
Salary and wages component of total
employee pay and benefits figure £31,080 £39,511 £53,638
Review of past performance
The following chart illustrates the Company’s performance compared to the FTSE SmallCap Index
– which is considered the most appropriate form of ‘broad equity market index’ against which the
Company’s performance should be measured (the Company is a constituent) – and the FTSE
AllShare Index (of which the Company is also an constituent), and to the FTSE 350 Media Index.
Performance, as required by legislation, is measured by TSR.
10-year TSR chart
1413 15 16 17 18 19 20 21 22 23
250
200
150
100
50
Reach plc FTSE 350 Media Index FTSE All-Share Index FTSE Small Cap Index
Source: Refinitiv Eikon
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Strategic Report Governance Financial Statements Other Information
Chief Executive Officer’s single figure of remuneration
2014 2015 2016 2017 2018 2019(a)
1
2019(b)
2
2020 2021 2022 2023
Single figure of remuneration (£’000) 1,678 2,260 749 893 949 780 323 485 2,069 561 564
Annual bonus outcome (% of maximum) 45.8% 34.6% 34.6% 39.7% 38.3% 67.65% 67.65% nil 70.83% nil nil
LTIP vesting (% of maximum) 62.6% 25.3% nil 40.0% 40.0% 40.0% n/a n/a 100% nil nil
1. 2014 to 2019(a) figures for the CEO are in respect of Simon Fox. Simon Fox resigned on 16 August 2019
2. 2019(b) to 2023 figures reflect Jim Mullen
Relative importance of spend on pay
The table below shows shareholder distributions (dividends and any share buy-backs) and total
employee pay expenditure for 2022 and 2023, along with the percentage change in both.
2023
£’000
2022
£’000
% change
2022–2023
Shareholder distributions (dividends) 23,100 22,900 0.9%
Total employee expenditure 221,700 233,200 (4.9)%
Directors’ beneficial interests shareholding requirements (audited)
The table below sets out the beneficial interests of the current non-executive directors in the share
capital of the Company as at 31 December 2023.
Non-executive directors
Ordinary shares at
31 December 2023
Ordinary shares at
25 December 2022
Anne Bulford 11,953 11,953
Priya Guha – –
Steve Hatch
1
10,207 10,207
Denise Jagger
2
– –
Barry Panayi 3,979 3,979
Nick Prettejohn 131,640 131,640
Wais Shaifta – –
Olivia Streatfeild 55,255 55,255
1. Steve Hatch left the Board in May 2023
2. Denise Jagger joined the Board in December 2022
The table below sets out beneficial interests of the executive directors in the share capital of the
Company and achievement against shareholding requirements, being 200% of base salary for
the CEO and CFO. The targets were not met as at 31 December 2023.
The table shows the position as at 31 December 2023 for current executive directors. Until the
relevant shareholding levels are attained, executive directors are required to retain 100% of shares
vesting, after the sale of sufficient shares to meet any income tax or National Insurance obligations
in respect of vested LTIP awards or in respect of vested deferred bonus share awards (such awards
are made under the Restricted Share Plan (RSP)).
Executive directors
Owned
outright
Unvested and
subject to other
conditions
1
Total share
interests
for SOGs
2
Value
of share
interests
3
Current
shareholding
(% salary/fee)
Jim Mullen 741,488 85,514 827,002 £589,321 117%
Darren Fisher 52,345 298,906 351,251 £157,863 44%
1. For the CEO, these are RSP awards in respect of deferred bonus and for the CFO are buy-out awards as
detailed on page 120. The RSP awards and buy-out awards are subject to continuing service requirements
and malus and clawback provisions
2. Share Ownership Guidelines
3. Calculations are based on the share price as at 31 December 2023. Value of the RSP and the CFO’’s buy-out
awards are reduced by 47% to reflect estimated tax and NI due at time of vesting in line with Investment
Association guidelines
None of the directors has a beneficial interest in the shares of any other Group company.
Since 31 December 2023 and up to the latest practicable date (27 February 2024), there have been
no changes in the directors’ interests in shares.
The lowest closing price of the shares during the year was £0.6605 and the highest price was £1.108.
The share price as at 29 December 2023 (the last trading day before 31 December 2023) was £0.749.
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Strategic Report Governance Financial Statements Other Information
Director
Date
of grant
Share price
used at date
of grant
At 26
December
2022 Granted
Exercised
LTIPs/released
RSPs
1
Lapsed
At 31
December
2023
Performance
period
Exercise period
(holding period)
Jim Mullen
LTIP
2
27.03.20 £0.969 782,346 – – (782,346) – 30.12.19-25.12.22 27.03.23-27.06.25 (27.03.23-27.03.25)
RSP 27.03.20 £0.969 34,932 3,398
3
(38,330)
4
– – – Restricted until 27.03.23
LTIP 11.05.21 £2.3517 364,430 – – – 364,430 28.12.20-31.12.23 11.05.24-11.11.24 (11.05.24-11.05.26)
Sharesave 14.07.21 £2.46 3,658
5
– – – 3,658 01.09.21-01.09.24 01.09.24-01.03.25
LTIP 11.04.22 £2.207 399,974 - – – 399,974 27.12.21-31.12.24 11.04.25-11.10.25 (11.04.25-11.04.27)
RSP 11.04.22 £2.207 85,514 - – – 85,514 – Restricted until 11.04.25
LTIP 13.04.23 £0.848 – 1,040,970 – – 1,040,970 26.12.22-31.12.25 13.04.26-13.10.26 (13.04.26-13.04.28)
Darren Fisher
LTIP 13.04.23 £0.848 – 582,708 – – 582,708 26.12.22-31.12.25 13.04.26-13.10.26 (13.04.26-13.04.28)
Buy-out
6
06.06.23 £0.7771 – 95,760 (95,760)
7
– – – 06.06.23–06.12.23
Buy-out
6
06.06.23 £0.7771 – 61,164 – – 61,164 – 13.05.24-12.11.24
Buy-out
6
06.06.23 £0.7771 – 80,816 – – 80,816 – 28.03.25-28.09.25
Buy-out
6
06.06.23 £0.7771 – 77,360 – – 77,360 – 28.03.25-28.09.25
Buy-out
6
06.06.23 £0.7771 – 79,566 – – 79,566 – 28.03.26-28.09.26
Simon Fuller
LTIP
8
11.03.19 £0.646 871,664 – – – 871,664 01.01.19–26.12.21 11.03.22-11.06.24 (11.03.22-11.03.24)
LTIP
8
27.03.20 £0.969 488,299 – – (261,563) 226,736 30.12.19-25.12.22 27.03.23-27.06.25 (27.03.23-27.03.25)
RSP 27.03.20 £0.969 15,597 1,517
9
(17,114)
10
– – – Restricted until 27.03.23
LTIP 11.05.21 £2.3517 243,706 – – (53,096)
11
190,610 28.12.20-31.12.23 11.05.24-11.11.24 (11.05.24-11.05.26)
LTIP 11.04.22 £2.207 267,474 - – (139,955)
11
127,519 27.12.21-31.12.24 11.04.25-11.10.25 (11.04.25-11.04.27)
RSP 11.04.22 £2.207 36,061 - – – 36,061 – Restricted until 11.04.25
Directors’ interests in shares under the Reach share plans (audited)
1. The aggregate amount of gains made by
the directors on the exercise of share options in
the year was £64,925 and release of vested RSP
awards in the year was £27,943 (2022: £983,532
and £159,650)
2. Jim Mullen’s 2020 LTIP award was cancelled and
lapsed at his request, as described on pages 120
and 121 of the 2022 Annual Report
3. On vesting of this award, another 3,398 shares in
respect of dividends in the period to vesting were
credited to this award in accordance with the
terms of the RSP plan rules
4. Of the 38,330 RSP shares which vested and were
released on 27 March 2023, 18,080 were sold to
cover tax & NI liabilities
5. These shares were granted as options under
the Reach Savings-Related Share Option Scheme
6. These awards represent a buy-out of awards
previously held by Darren Fisher that were forfeited
on his joining the Company. The buy-out awards
will vest on the original vesting dates of the forfeited
awards, subject to Darren’s continued employment
with Reach up to the relevant vesting dates. The
number of shares under the buy-out awards
are equivalent in value to the awards forfeited,
calculated using a three-month average share
price of £0.7771 per share
7. Of the 95,760 LTIP shares which were awarded on
6 June 2023, all of the shares vested on the same
date and were exercised on 22 June 2023. 45,168
shares were sold to cover tax & NI liabilities.
The share price on 22 June 2023 was £0.668
8. These shares have vested but have not yet
been exercised
9. On vesting of this award, another 1,517 shares in
respect of dividends in the period to vesting were
credited to this award in accordance with the
terms of the RSP plan rules
10. Of the 17,114 RSP shares which vested and were
released on 27 March 2023, 8,105 were sold to
cover tax & NI liabilities
11. When Simon stepped down from the Board
he retained an interest in the 2021 and 2022
LTIP awards which were pro-rated to reflect
time served. These awards will continue to vest
at the usual times subject to achievement of the
respective performance conditions. Following
the FY23 year end, the 2021 LTIP lapsed in full
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Strategic Report Governance Financial Statements Other Information
Details of plans
Long Term Incentive Plan
Vesting of LTIP awards is subject to continued employment and the Company’s performance over
a three-year performance period. If no entitlement has been earned at the end of the relevant
performance period, awards will lapse. There is a two-year holding period on vested LTIP shares,
with malus and clawback provisions. The 2021, 2022 and 2023 LTIP awards are granted as nil-cost
options, with a six-month exercise period post vesting.
Plan
TSR targets Cumulative Net Cash Flow targets
Weighting
Threshold
(20% vesting)
Full vesting
(100% vesting) Weighting
Threshold
(20% vesting)
Full vesting
(100% vesting)
2021 LTIP (relative TSR) 70% Median
Upper
quartile 20% £345m £395m
2022 LTIP (relative TSR) 70% Median
Upper
quartile 20% £285m £330m
2023 LTIP (relative TSR) 75% Median
Upper
quartile n/a n/a n/a
Relative TSR for the 2021 and 2023 LTIP is measured against the constituents of the FTSE SmallCap
(ex. IT). For 2022’s award, it is measured against the constituents of the FTSE 250 Index (ex. IT).
Cumulative Net Cash Flow under each of the awards is defined consistently with past years.
In addition, the 2021 and 2022 LTIP each has a 10% weighting on ARPU. The 2023 LTIP has a 12.5%
weighting on ARPU and a 12.5% weighting on RPM.
Restricted Share Plan
Awards under the RSP are deferred bonus share awards. These awards may not be transferred or
otherwise disposed of by a participant for a period of three years from the date of grant subject to
malus and clawback provisions. Participants beneficially own the restricted shares from the date
of grant. Legal title is held by the RSP Trustees until the restricted shares are released into the
participant’s name. Additional shares representing reinvested dividends may be released
following the vesting of share awards.
Restrictions on the shares end on the third anniversary of the grant, when the shares will be
released into the participant’s name.
Share plans dilution
Overall dilution from share plans for our share plans dilution limit is 4.3% as at 31 December 2023.
This comprises 3.6% in respect of LTIP and 0.7% in respect of Sharesave and other all-employee
plans. These figures consider all share plan awards made in the last 10 years, excluding awards
which have lapsed and awards which have been or are proposed to be satisfied by shares
purchased on the market by Reach’s employees’ share trust.
Implementation of Remuneration Policy for 2024
Base salary
The Group-wide salary review date is 1 April 2024. As at the date of this report, the salary of the CEO
is £504,425 and the salary of the CFO is £360,000.
Pension and benefits
Jim Mullen and Darren Fisher each have a 7.5% of salary pension allowance for 2024.
Annual bonus and RSP
For 2024, the maximum annual bonus opportunity will be 125% of salary for the CEO and 100% of
salary for the CFO.
The annual bonus plan for our executive directors in 2024 will be fully assessed on Group adjusted
operating profit.
Before any 2024 annual bonus outcomes are confirmed, the Committee will conduct an overview
assessment of performance in the year and consider progress against a wider range of factors.
Performance targets for the 2024 financial year are considered to be commercially sensitive and
are not disclosed on a prospective basis. However, it is intended that performance against targets
will continue to be disclosed in next year’s Annual Remuneration Report.
Any bonus earned in excess of 50% of salary will be deferred in shares under the RSP for three years.
LTIP awards to be awarded in 2024
In 2024, LTIP awards will be made to each of the CEO and CFO at the levels allowed by the Policy
(175% base salary for the CEO and 150% base salary for the CFO).
Remuneration Report continued
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Strategic Report Governance Financial Statements Other Information
The three-year performance period for all metrics for the 2024 LTIP awards is the period from
1 January 2024 to 31 December 2026. The balance of metrics will be:
• Relative TSR (40%);
• Absolute TSR Growth (20%);
• Revenue per thousand page views (RPM) (25%);
• ESG – reduction in Scope 1 and Scope 2 emissions (15%).
The following paragraphs describe the targets for each metric.
TSR performance relative to constituents of FTSE SmallCap (ex. IT) % of award that can be exercised
Upper quartile or above 40%
Between median and upper quartile Straight-line vesting between 8% and 60%
Median 8% (being 20% weighting of this part)
Below median Nil
Absolute growth in TSR (three-year CAGR) % of award that can be exercised
20% or above 20%
Between 10% and 20% Straight-line vesting between 4% and 20%
10% 4% (being 20% weighting of this part)
Below 10% Nil
For both TSR conditions, measurement will be on the basis of three-month average return figures
at the start and end of the performance period. In the three-month average base period to
31 December 2023, Reach’s average share price was 75.4p.
The FTSE SmallCap (ex. IT) is used for relative TSR as Reach was a member of that index at the start
of the performance period.
The RPM metrics relate to Reach’s Customer Value Strategy. For RPM the range of targets has been
set by the Committee for 2024’s awards by reference to the three-year business plan, and the
Committee considers the ranges set to require stretching growth over the period 2024–2026.
Remuneration Report continued
The Committee regards the RPM targets for the 2024 LTIP awards as commercially sensitive at
the current time and, accordingly, will not be disclosing the target ranges on a prospective basis.
The information will be disclosed when it is appropriate to do so, and no later than on the
publication of the Directors’ Remuneration Report for the year of vesting.
The environmental metrics will measure the absolute reduction in Scope 1 and Scope 2 emissions
(tCO
2
e) over the period 1 January 2024 to 31 December 2026.
% reduction from 2023 base line % of award that can be exercised
19% or above 15%
Between 16% and 19% Straight-line vesting between 3% and 15%
16% 3% (being 20% weighting of this part)
Below 16% Nil
The targets for this metric are aligned to Reach’s near-term science-based targets for Scope 1
and 2 emissions in 2030 which were approved by the Reach Sustainability Committee in
December 2023 and the measurement will be subject to external verification.
If there are changes to the business that would result in significant changes in the emissions
inventory, Reach plc’s 2030 baseline and targets would be recalculated in line with best practice in
a process overseen by the Sustainability Committee with external validation. The Remuneration
Committee will continue to work closely with the Sustainability Committee to ensure the
environmental metrics for LTIP continue to be an appropriate incentive as the business evolves.
Chairman and non-executive director fees
The fees for the Chairman and non-executive directors for 2024 will apply as described on page 119.
Olivia Streatfeild
Remuneration Committee Chair
5 March 2024
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Strategic Report Governance Financial Statements Other Information
COMPLIANCE WITH THE 2018 UK
CORPORATE GOVERNANCE CODE
The Board considers that, during 2023, the Company applied the principles and complied with all
of the provisions set out in the 2018 UK Corporate Governance Code (the 2018 Code), for the period
under review. Details on how Reach has applied the principles set out in the 2018 Code and how
governance operates at Reach have been summarised throughout this Governance section and
elsewhere in this Annual Report as set out below. The full 2018 Code is available on the Financial
Reporting Council’s (FRC) website at www.frc.org.uk.
1. Board leadership and Company purpose
A. Board’s role The Board is collectively responsible for promoting the long-term success of the Company for its shareholders and other stakeholders. It is also responsible for establishing the
Company’s purpose, values and strategy, and for promoting the desired culture. The Board also provides entrepreneurial leadership within a framework of prudent and effective
controls, which enables risk to be assessed and managed.
Matters and decisions that require Board approval are set out in a formal schedule of matters reserved for its decision, which was last reviewed and updated in February 2024.
The full schedule of matters reserved is available at www.reachplc.com/investors/corporate-governance/accountability.
A summary of the Board’s activities during 2023 can be found on pages 79 to 84.
B. Purpose
and culture
Since 2020, the Board has overseen the implementation and delivery of the Customer Value Strategy, designed to ensure the Group remains aligned to our purpose.
The Board held meetings in April and September 2023 to consider the Group’s strategy. More information can be found on page 80.
Board members also made site visits, enabling them to meet with colleagues and gain first-hand insight into the culture of various areas of the business. The CEO and CFO also
hosted virtual town hall events throughout the year, and the non-executive directors attended and participated in lunches with leaders and breakfasts with wider colleagues.
More information can be found about these events on pages 82 and 83.
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1. Board leadership and Company purpose continued
C. Resources
and controls
The Board’s agenda is set by the Chairman and deals with matters reserved for the Board, including those relating to the Group’s strategic plan, risk appetite, systems of internal
control and corporate governance policies.
The Audit & Risk Committee helps the Board to oversee the risks to which the Group may be exposed and provides the Board with strategic advice in relation to current and
potential risk exposures. More information on risk management can be found on pages 66 and 67.
D. Stakeholder
engagement
The Board fully considered shareholders’ and wider stakeholders’ views when making strategic decisions in 2023. More information can be found in the section 172 statement on
pages 85 to 87.
The AGM provides a valuable opportunity for the Board to engage with shareholders and listen to their feedback. At the 2023 AGM, the Board’s proposals received a high level of
support and all resolutions were passed with over 96% of votes cast in favour.
A General Meeting was held in 2023 to approve a capital reduction of the share premium account. This was passed with 99.98% votes cast in favour.
E. Workforce
engagement
Olivia Streatfeild is the designated non-executive director responsible for workforce engagement. More information can be found about this work on page 82.
The Group has a whistleblowing charter and provides a confidential, independent whistleblowing line that employees can use to report any concerns about the integrity of the
business or breaches of the Group’s policies. Colleagues are also encouraged to share their views through regular engagement surveys, and the results of these are reported to
the Board.
2. Division of responsibilities
F. Role of
the Chair
The Chairman is responsible for:
• the leadership of the Board, including setting its agenda and chairing Board meetings;
• promoting a culture of openness and debate to encourage constructive challenge; and
• ensuring the Board receives accurate, clear and timely information to support sound decision-making.
G. Composition
of the Board
The composition of the Board is set out in Our Board on pages 76 to 78. Excluding the Chairman, Nick Prettejohn, 66.67% of the Board are independent non-executive directors,
and their independence is assessed annually. The Chairman was deemed independent on appointment in 2018 and continues to demonstrate objective judgement.
There is a clear division of responsibilities between the Board and executive leadership. The responsibilities of the Chairman, CEO and Senior Independent Director are set out in
full at www.reachplc.com/investors/corporate-governance/accountability.
The Board has a Conflicts Policy in place. This provides a formal system for directors to declare conflicts, which those directors who have no formal interest in the matter then
consider for authorisation.
Compliance with the 2018 UK Corporate Governance Code continued
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2. Division of responsibilities continued
H. Role of the
non-executive
directors
The main responsibilities of the non-executive directors are to provide an external perspective in Board discussions, to be responsible for scrutinising executive management on
behalf of shareholders, and to constructively challenge Board discussions and help develop proposals on strategy.
The non-executive directors’ letters of appointment set out the time commitment expected from them. The Board is satisfied that each director has sufficient time to devote to
discharging their responsibilities as a director of the Company. The Board reviews and approves as necessary any additional external appointments the directors may look to obtain.
In addition, the Senior Independent Director acts as a sounding board, provides support to the Chairman, acts as an intermediary for other directors when necessary, is available
to shareholders to help address any concerns and reviews the Chairman’s performance with other non-executive directors.
I. Role of the
Company
Secretary
The Company Secretary enables effective communication flows between the Board and its Committees, and between senior management and the non-executive directors.
They also provide effective support to the Board during meetings and when setting agendas and ensure the Board operates in accordance with the Company’s corporate
governance framework. All directors have access to the advice and services of the Company Secretary, who also facilitates any other professional development that directors
consider necessary to help them carry out their duties.
3. Composition, succession and evaluation
J. Appointments
to the Board and
succession
planning
The Nomination Committee is responsible for reviewing Board composition and diversity, leading the process for new Board appointments and ensuring there are plans in
place for Board and senior management succession planning and talent. Appointments are based on merit, against objective criteria, with the aim of bringing a range of skills,
knowledge and experience to Reach. This involves a formal, rigorous and transparent process to source strong candidates from diverse backgrounds, promoting cognitive and
personal strengths. More information can be found in the Nomination Committee Report on pages 88 to 93.
K. Skills,
experience and
knowledge of
the Board
In making recommendations for appointments, the Nomination Committee considers the balance of skills, experience and knowledge needed to enhance the Board and
support the Group in executing its strategy. Darren Fisher was appointed to the Board as CFO in February 2023. There were no other appointments made during the year.
All directors are subject to shareholder election or re-election at the AGM, with the exception of those directors who are retiring at the conclusion of the meeting. The Chairman,
on behalf of the Board, has confirmed each non-executive director continues to be an effective member of the Board and will stand for re-election at the 2024 AGM.
None of the non-executive directors have currently served more than nine years on the Board.
L. Board
evaluation
The last external Board evaluation, facilitated by Sam Allen Associates Limited, was undertaken during 2021. An internal evaluation was carried out in 2023. More information about
the progress made against the recommendations from the 2022 evaluation, and actions to be undertaken in 2024 from the 2023 internal evaluation, can be found on page 90.
Compliance with the 2018 UK Corporate Governance Code continued
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Strategic Report Governance Financial Statements Other Information
4. Audit, risk and internal control
M. Internal and
external audit
The Audit & Risk Committee is responsible for monitoring the integrity of the financial statements, reviewing the Group’s internal controls and risk management systems, and
overseeing the auditor relationship and work undertaken by internal audit.
More information about how the Audit & Risk Committee assesses the effectiveness and independence of the external auditors can be found on pages 97 and 98.
N. Fair,
balanced and
understandable
The Strategic Report (pages 1 to 73) sets out the performance of the Company, the business model, strategy and the risks and uncertainties relating to the Company’s future
prospects. When taken as a whole, the directors consider the Annual Report is fair, balanced and understandable and provides information necessary for shareholders to assess
the Company’s performance, business model and strategy. More information about the review and assessment of the Annual Report can be found on page 97.
O. Risk
management
and internal
control
framework
The Board sets the Company’s risk appetite and annually reviews the effectiveness of the Company’s risk management and internal control systems. A description of the
principal risks facing the Company can be found on pages 68 to 72. Page 73 sets out how the directors have assessed the prospects of the Company, over what period they
have done so and why they consider that period to be appropriate (the viability statement).
5. Remuneration
P. Remuneration
policies and
practices
The Company aims to reward employees fairly, so its remuneration policy is designed to promote the long-term success of the Company while aligning the interests of both the
executive directors and shareholders.
Shareholders approved the updated Remuneration Policy at the 2021 Annual General Meeting, and the Company is required to seek approval for the new Policy at the AGM to be
held on 2 May 2024, from which date the Policy will apply. The proposed Remuneration Policy can be found on pages 107 to 115.
Q. Executive
remuneration
The Remuneration Committee is responsible for setting the remuneration for executive directors. No director is involved in deciding their own remuneration arrangements
or outcome.
R. Remuneration
outcomes and
independent
judgement
Details of the composition and work of the Remuneration Committee can be found in the Remuneration Report on pages 116 to 126.
Compliance with the 2018 UK Corporate Governance Code continued
130
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Strategic Report Governance Financial Statements Other Information
The Directors’ Report
comprises the Governance
Report (on pages 74 to 103),
the Directors’ Report (on pages
131 to 135) and the Shareholder
information section (on pages
207 and 208). The following
information is provided in
other appropriate sections
of the Annual Report and is
incorporated by reference
in this table.
Information Reported in Page number(s)
Likely future developments and performance of the Company Strategic Report 29
Stakeholder engagement Strategic Report 30 to 53
Governance Report 74 to 103 and 127 to 130
Engaging with employees Strategic Report 44
Employment of disabled persons Strategic Report 43 and 44
Greenhouse gas emissions Strategic Report 52 and 53
Task Force on Climate-related Financial Disclosures (TCFD) report Strategic Report 54 to 64
Viability statement Strategic Report 73
Compliance with the 2018 UK Corporate Governance Code Governance Report 127 to 130
Directors Our Board 76 to 78
Directors’ Remuneration Report 104 to 126
Directors’ Remuneration Report –
directors’ beneficial interests and
shareholding requirements
123 and 124
Details of Long Term Incentive Plan Directors’ Remuneration Report 125
Dividend waiver Directors’ Report 134
Statement of Directors’ responsibilities Directors’ Report 135
Going concern Financial statements 149 and 150
Accounting policies, financial instruments and financial risk management Financial statements 149 to 157
179 to 182
191 and 192
To comply with DTR 4.1.5R(2) and DTR 4.1.8R, the required content of the Management Report can be found in the Strategic Report or this Directors’
Report, including the material incorporated by reference.
DIRECTORS’
REPORT
Directors’ Report
131
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Strategic Report Governance Financial Statements Other Information
Articles of Association
The Company’s Articles of Association
(the Articles) set out the internal regulations
of the Company and cover such matters as
the rights of shareholders, the appointment
and removal of directors, and the conduct
of the Board and general meetings.
The Articles can only be amended by at
least a 75% vote in favour from those voting
in person or by proxy at a general meeting
of the shareholders.
A copy of the Articles is available to view on
our website at www.reachplc.com/investors/
corporate-governance.
Directors
The directors of the Company who were in
office during the year and up to the date of
signing the financial statements are listed on
pages 76 to 78, together with details of each
director’s skills, experience and current external
appointments. Details of directors’ beneficial
and any non-beneficial interests in the shares
of the Company are shown on pages 123 and
124. Options granted to directors under the
Sharesave, the Long Term Incentive Plan and
the Restricted Share Plan are shown on page
124. More information regarding employee
share option schemes is provided in note 32
to the consolidated financial statements on
pages 178 to 179.
Appointment and replacement
of directors
The Articles give the directors the power to
appoint and replace directors. Under the terms
of reference of the Nomination Committee,
appointments must be recommended by
the Nomination Committee for approval
by the Board.
The Articles also require directors to retire
and submit themselves for election to the first
Annual General Meeting (AGM) following their
appointment and to retire at the AGM held in
the third calendar year after election or last
re-election. However, to comply with the 2018
UK Corporate Governance Code, all the
directors will submit themselves for
election or re-election at each AGM.
Compensation for loss of office
There are no agreements in place between
the Company and any director or employee
for loss of office in the event of a takeover.
Directors’ indemnity and insurance
The directors have the benefit of an indemnity,
which is a qualifying third-party indemnity
provision as defined by section 234 of the
Companies Act 2006. This provision was in
force during the financial year and when
the Directors’ Report was approved.
The Company maintains appropriate liability
insurance for its directors and officers, which
provides cover for any legal action brought
against them.
Share capital
As at 31 December 2023, the Company’s issued
share capital comprised 322,085,269 ordinary
shares with a nominal value of 10 pence each.
The Company held 4,110,884 ordinary shares
in Treasury. Therefore, the total number of
voting rights in the Company was 317,974,385.
All shares other than those held in Treasury are
freely transferable and rank equally for voting
and dividend rights. The Company is not
aware of any agreements between holders
of shares that result in any restrictions.
As at 31 December 2023, the Trinity Mirror
Employees’ Benefit Trust held 3,271,758
shares (2022: 3,503,358). The TIH Employee
Benefit Trust was wound up on 31 August 2023,
and the 94,740 shares held in this trust were
transferred to the Trinity Mirror Employees’
Benefit Trust. The Trustees of both Employee
Benefit Trusts have elected to waive dividends
on shares held under the trusts relating
to dividends payable during the year.
Details of the authorised and issued share
capital, share premium account, Treasury
shares and Employee Benefit Trusts can be
found in notes 29 to 32 in the notes to the
consolidated financial statements.
As at the latest practicable date (27 February
2024), the Company held 4,110,579 shares
in Treasury, representing 1.28% of the issued
share capital of the Company. Treasury shares
do not receive dividends and are not included
when calculating the total voting rights in the
Company. The Company, if deemed fit, can
sell the shares for cash or transfer the shares
for use in an employee share scheme.
During the year, the following transfers from
Treasury were made:
Date Transfer
3 April 2023 –
13 October 2023
903,526 shares
were withdrawn from
Treasury and transferred
to Equiniti to satisfy
Reach share plans
Directors’ Report continued
132
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Strategic Report Governance Financial Statements Other Information
Substantial shareholdings
The Company has been notified, in accordance with Chapter 5 of the Disclosure Guidance and
Transparency Rules, of the following direct or indirect holdings of voting rights, including shares
and other financial instruments, in the Company’s shares:
Name
As at
31 December
2023
Number of
voting rights
As at
31 December
2023
% of total voting
rights
As at 27 February
2024
Number of
voting rights
As at 27 February
2024
% of total voting
rights
Aberforth Partners 31,795,824 10.03% 31,795,824 10.03%
Dimensional Fund Advisor
1
12,843,108 4.98% 12,843,108 4.98%
FMR LLC 16,057,004 5.05% 16,057,004 5.05%
Lombard Odier Asset
Management (Europe) Limited 15,955,434 5.02% 15,955,434 5.02%
M&G plc
2
44,209,812 14.03% 44,209,812 14.03%
Premier Miton Group plc
3
15,597,514 5.00% 15,597,514 5.00%
Schroders plc
4
14,488,704 4.63% 14,488,704 4.63%
Slater Investments
2
15,789,961 5.02% 15,789,961 5.02%
Wellcome Trust 13,044,412 4.11% 13,044,412 4.11%
1. Disclosure made in 2015 and prior to 2020 bonus issue and increases in the share capital pursuant to
transactions that took place in 2015 and 2018
2. Disclosures made in 2022
3. Since the 2021 disclosure, Premier Miton Group plc has sold shares and as at 27 February 2024 holds 0.93%
voting rights, making it no longer a substantial shareholder
4. Disclosures made in 2021
Purchase of own shares
At the Company’s AGM on 3 May 2023, shareholders approved an authority for the Company to
make market purchases of its own shares up to a maximum of 31,707,085 shares (being 10% of the
issued share capital less Treasury shares at that time) at prices not less than the nominal value
of each share (being 10 pence each) and not exceeding 105% of the average mid-market price
for the preceding five business days. No use was made of this authority during the period.
The Company intends to renew this authority at its 2024 AGM.
Allotment of shares
At the Company’s AGM on 3 May 2023,
shareholders approved an authority for
the Company to allot ordinary shares up to
a maximum nominal amount of £10,569,028
(being one-third of the Company’s issued
share capital less Treasury shares at that
time). The Company intends to renew this
authority at its 2024 AGM.
Change of control provisions
The directors are not aware of there being
any significant agreements that contain any
material change of control provisions to which
the Company is a party other than in respect
of the financing facilities that expire in
November 2026. Under the terms of these
facilities, and in the event of a change of
control of the Company, the banks can
withdraw funding; and all outstanding loans,
accrued interest and other amounts due and
owing become payable within 30 days of
the change.
AGM
The AGM provides an opportunity for directors
to engage with shareholders, answer their
questions and meet them informally.
The next AGM is planned to take place on
2 May 2024 in London. More details of the
arrangements will be posted on our website,
www.reachplc.com, and will be contained
within the Notice of Meeting.
The Notice of Meeting and proxy form for the
2024 AGM will be shared with shareholders
at least 20 working days prior to the meeting
date, as required by the FRC’s Guidance on
Board Effectiveness. A detailed explanation
of each item of business to be considered at
the 2024 AGM will be included in the Notice
of Meeting, which will either be sent by post
to the shareholders in advance of the 2024
AGM or will be available to download from
our website, www.reachplc.com.
Shareholders who are unable to attend
the 2024 AGM are encouraged to vote
in advance of the meeting, either online at
www.shareview.co.uk or by using the proxy
form, which will be sent to all shareholders.
Dividends
The Board proposes a final dividend for 2023
of 4.46 pence per share (2022: 4.46 pence per
share), which, subject to shareholder approval,
will be payable on 31 May 2024 to shareholders
on the register on 10 May 2024. The proposed
final dividend together with the interim dividend
of 2.88 pence per share (2022: 2.88 pence per
share) results in a total dividend for 2023 of
7.34 pence per share (2022: 7.34 pence
per share).
Directors’ Report continued
133
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Strategic Report Governance Financial Statements Other Information
Dividend waivers
There is a waiver in place in respect of all or any
future right to dividend payments on shares
held in the Trinity Mirror Employees’ Benefit Trust
(3,271,758 shares as at 31 December 2023) and
shares held in Treasury (4,110,884 shares as at
31 December 2023).
Dividend Policy
The Board recognises the importance of
growing dividends for shareholders while also
investing to grow the business and meeting
our funding commitments to the defined
benefit pension schemes. The Board expects
to continue to adopt a policy of paying
dividends that are aligned to the free cash
generation of the Group. Free cash generation
for this purpose is the net cash flow generated
by the Group before the repayment of debt,
dividend payments, other capital returns to
shareholders and additional contributions
made to the defined benefit pension schemes.
The Board will also continue to consider,
if appropriate, the return of capital to
shareholders through a share buy-back if
it has generated surplus cash and sees an
opportunity to enhance earnings per share
and therefore shareholder value. Prior to
initiating a share buy-back programme, the
Board will carefully consider the cash generation
of the business and the Group’s obligations to
its defined benefit pension schemes.
The risks associated with delivering the
Dividend Policy are:
• the availability of distributable reserves – in
2014, an impairment of the carrying value of
investments held by the Company resulted
in a negative balance on the profit and loss
reserve, so the Company had no distributable
reserves. This was addressed by undertaking
a court-approved capital reduction to
eliminate the negative balance in the
profit and loss reserve and, since then,
the distributable reserves have been rebuilt
through dividends received from subsidiary
companies from profits. The Company
has subsequently performed another
court-approved capital reduction in 2023,
converting the total £605.4m within the
share premium account into distributable
reserves within the profit and loss reserve;
• a significant fall in profit and cash flow that
materially reduces free cash flow – under
these circumstances, the Group would
review all investment requirements and
pension obligations. In such circumstances,
we would seek to hold dividends unless
it would place increased pressure on
the Group’s ability to fund investment
to deliver its strategy or if it was to
create any financing issues; and
• the payment of dividends would potentially
restrict the ability of the Group to meet
payments due under the recovery plans
agreed with the Group’s defined benefit
pension schemes. The Group agrees
recovery plans with the Trustees of the
Group’s defined benefit pension schemes
at each triennial valuation based on
developments in the funding position between
valuations and these may be also revised
as a result of material corporate activity.
As part of the 2019 triennial valuations of
four of the Group’s defined benefit pension
schemes which remain not fully bought-in,
the Group has committed to dividend
sharing arrangements whereby it would
pay to each scheme a pro-rated share of
the excess in dividend payment increases
greater than 5% in any year for so long
as the schemes continue to receive
contributions. Further, the Group has agreed
that dividend payments or any other return
of capital to shareholders in any year will not
be in excess of the aggregate contributions
due to the defined benefit pension schemes
in the same year to address past deficits.
These obligations may restrict future
increases in dividends.
Political donations
At the Company’s AGM held on 3 May 2023,
the Company and its subsidiaries received
authority from shareholders under the
Companies Act 2006 to make donations to
political parties of up to £75,000 in aggregate
each year. The resolution passed, with 92.31%
of participating shareholders voting in favour.
This resolution was proposed to ensure that
neither the Company nor its subsidiaries
inadvertently commits any breaches of the
Companies Act 2006 through undertaking
routine activities. No political donations
were made during 2023 (2022: nil).
Strategic Report
The Company’s Strategic Report is set out
on pages 1 and 73. It sets out the Company’s
business model and strategy, principal risks
and uncertainties facing the Group and how
these are managed and mitigated.
Results
A review of the Company’s consolidated
results can be found on pages 22 to 29.
Modern slavery
In compliance with the Modern Slavery
Act 2015, the Company’s Modern Slavery
Statement can be found on our website at
www.reachplc.com/investors/corporate-
governance/policies.
Disclosure table pursuant to
Listing Rule 9.8.4R
In accordance with LR 9.8.4R, the table
below sets out the location of the information
required to be disclosed, where applicable.
Applicable sub-paragraph
within LR 9.8.4R Page number
(6) Waivers of future
emoluments
Remuneration
Report page 106
(12) Waivers of dividends Directors’ Report
page 134
(13) Waivers of future
dividends
Directors’ Report
page 134
Directors’ Report continued
134
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Strategic Report Governance Financial Statements Other Information
Environmental management
Reach continues to comply with the
Companies Act 2006 (Strategic Report and
Directors’ Report) Regulations 2013. We are also
reporting in compliance with the Companies
(Directors’ Report) and Limited Liability
Partnerships (Energy and Carbon Report)
Regulations 2018, known as SECR (Streamlined
Energy and Carbon Reporting). We have
fully disclosed our Scope 1 and 2 emissions
as well as all relevant Scope 3 emissions
for the reporting period 1 January 2023 to
31 December 2023. We also comply with
the Climate Change Agreements (Eligible
Facilities) Regulations. Energy consumption
and greenhouse gas emissions have been
calculated in line with the UK Government’s
Regulations as published in Environmental
reporting guidelines: including Streamlined
Energy and Carbon Reporting requirements.
Statement of directors’
responsibilities in respect
of the financial statements
The directors are responsible for preparing the
Annual Report and the financial statements in
accordance with applicable law and regulation.
Company law requires the directors to
prepare financial statements for each
financial year. Under that law, the directors
have prepared the group financial statements
in accordance with UK-adopted international
accounting standards and the parent
company financial statements in accordance
with United Kingdom Generally Accepted
Accounting Practice (United Kingdom
Accounting Standards, comprising FRS 101
Reduced Disclosure Framework, and
applicable law).
Under company law, directors must not
approve the financial statements unless they
are satisfied that they give a true and fair view
of the state of affairs of the group and parent
company and of the profit or loss of the group
for that period. In preparing the financial
statements, the directors are required to:
• select suitable accounting policies
and then apply them consistently;
• state whether applicable UK-adopted
international accounting standards have
been followed for the group financial
statements and United Kingdom Accounting
Standards, comprising FRS 101, have been
followed for the parent company financial
statements, subject to any material
departures disclosed and explained
in the financial statements;
• make judgements and accounting
estimates that are reasonable and
prudent; and
• prepare the financial statements on the
going concern basis unless it is inappropriate
to presume that the group and parent
company will continue in business.
The directors are responsible for safeguarding
the assets of the group and parent company
and hence for taking reasonable steps to
prevent and detect fraud and other irregularities.
The directors are also responsible for keeping
adequate accounting records that are
sufficient to show and explain the group’s and
parent company’s transactions. The records
must enable the directors to disclose with
reasonable accuracy at any time the financial
position of the group and parent company
and enable them to ensure that the financial
statements and the Directors’ Remuneration
Report comply with the Companies Act 2006.
In addition, the directors are responsible for
the maintenance and integrity of the parent
company’s website. Legislation in the United
Kingdom governing the preparation and
dissemination of financial statements may
differ from legislation in other jurisdictions.
Directors’ confirmations
The directors consider that the Annual
Report and Accounts, taken as a whole, is fair,
balanced and understandable and provides
the information necessary for shareholders
to assess the Group’s and parent company’s
position and performance, business model
and strategy.
Each of the directors, whose names and
functions are listed in the Our Board section
on pages 76 to 78 of the Annual Report,
confirm that, to the best of their knowledge:
• the Group financial statements, which
have been prepared in accordance with
UK-adopted international accounting
standards, give a true and fair view of the
assets, liabilities, financial position and profit
of the Group;
• the parent company financial statements,
which have been prepared in accordance
with United Kingdom Accounting Standards,
comprising FRS 101, give a true and fair view
of the assets, liabilities and financial position
of the parent company; and
• the Strategic Report includes a fair review
of the development and performance
of the business and the position of the
Group and parent company, together
with a description of the principal
risks and uncertainties that it faces.
In the case of each director in office at the
date the Directors’ Report is approved:
• so far as the director is aware, there is
no relevant audit information of which the
Group’s and parent company’s auditors are
unaware; and
• they have taken all the steps that they
ought to have taken as a director to make
themselves aware of any relevant audit
information and to establish that the
Group’s and parent company’s auditors
are aware of that information.
The Directors’ Report was approved on behalf
of the Board on 5 March 2024.
Darren Fisher
Chief Financial Officer
5 March 2024
Directors’ Report continued
135
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 136
Independent auditors’ report to the members of Reach plc
Report on the audit of the
financial statements
Opinion
In our opinion:
• Reach plc’s group financial statements
and company financial statements (the
“financial statements”) give a true and fair
view of the state of the group’s and of the
company’s affairs as at 31 December 2023
and of the group’s profit and the group’s
cash flows for the 53 week period then ended;
• the group financial statements have been
properly prepared in accordance with
UK-adopted international accounting
standards as applied in accordance with
the provisions of the Companies Act 2006;
• the company financial statements have
been properly prepared in accordance
with United Kingdom Generally Accepted
Accounting Practice (United Kingdom
Accounting Standards, including FRS 101
“Reduced Disclosure Framework”, and
applicable law); and
• the financial statements have been
prepared in accordance with the
requirements of the Companies Act 2006.
We have audited the financial
statements, included within the Annual
Report, which comprise: the Consolidated
and Parent company balance sheets as at
31 December 2023; the Consolidated income
statement, the Consolidated statement of
comprehensive income, the Consolidated
cash flow statement and the Consolidated
and Parent company statements of changes
in equity for the period then ended; and
the notes to the financial statements, which
include a description of the significant
accounting policies.
Our opinion is consistent with our reporting to
the Audit & Risk Committee.
Basis for opinion
We conducted our audit in accordance with
International Standards on Auditing (UK) (“ISAs
(UK)”) and applicable law. Our responsibilities
under ISAs (UK) are further described in the
Auditors’ responsibilities for the audit of the
financial statements section of our report.
We believe that the audit evidence we have
obtained is sufficient and appropriate to
provide a basis for our opinion.
Independence
We remained independent of the group in
accordance with the ethical requirements
that are relevant to our audit of the financial
statements in the UK, which includes the FRC’s
Ethical Standard, as applicable to listed public
interest entities, and we have fulfilled our other
ethical responsibilities in accordance with
these requirements.
To the best of our knowledge and belief, we
declare that non-audit services prohibited by
the FRC’s Ethical Standard were not provided.
Other than those disclosed in Note 6, we
have provided no non-audit services to the
company or its controlled undertakings in the
period under audit.
Our audit approach
Overview
Audit scope
• The group’s core publishing operations are
accounted for on one general ledger. We
performed full scope audits over this and
the parent company ledger. This involved
work undertaken at locations where the
group’s main financial business processes
are managed, which are the central
accounting function in Liverpool, the group’s
London headquarters and print operations
in Watford.
• Our audit scoping gave us coverage of 99%
(2022: 99%) of revenue.
Key audit matters
• Carrying value of intangible assets (group)
and investments in subsidiaries (parent)
• Provision for historical legal issues (group)
• Valuation of pension liabilities and pension
assets (group)
Materiality
• Overall group materiality: £4.90m
(2022: £5.70m) based on 5% of a three
year average of profit before tax and
before impairment charges and reversals,
significant restructuring charges and costs
associated with historical legal issues.
• Overall company materiality: £6.00m
(2022: £7.90m) based on 1% of total assets.
• Performance materiality: £3.74m
(2022: £4.27m) (group) and £4.50m
(2022: £5.93m) (company).
The scope of our audit
As part of designing our audit, we determined
materiality and assessed the risks of material
misstatement in the financial statements.
Key audit matters
Key audit matters are those matters that, in
the auditors’ professional judgement, were of
most significance in the audit of the financial
statements of the current period and include
the most significant assessed risks of material
misstatement (whether or not due to fraud)
identified by the auditors, including those
which had the greatest effect on: the overall
audit strategy; the allocation of resources
in the audit; and directing the efforts of the
engagement team. These matters, and any
comments we make on the results of our
procedures thereon, were addressed in the
context of our audit of the financial statements
as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on
these matters.
This is not a complete list of all risks identified
by our audit.
The key audit matters below are consistent
with last year.
136
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 136
Independent auditors’ report to the members of Reach plc
Reach plc Annual Report 2023 137
Independent auditors’ report to the members of Reach plc continued
Key audit matter How our audit addressed the key audit matter
Carrying value of
intangible assets
(group) and
investments in
subsidiaries (parent)
Refer to Note 3 of the
consolidated financial
statements for the directors’
disclosure on the critical
accounting judgements, Notes
15 and 16 of the consolidated
financial statements and Note 4
of the parent company
financial statements for the
directors’ disclosure of the
key sources of estimation
uncertainty, and pages 99
and 100 for the views of the
Audit & Risk Committee.
At 31 December 2023, the group
held indefinite life intangibles
(being the carrying value of
acquired publishing rights and
titles, after previous impairment
charges) of £818.7m
(2022: £818.7m) and goodwill
of £35.9m (2022: £35.9m).
The parent company held
investments with a carrying
value before impairment of
£708.9m that has been
impaired to £541.1m during the
current financial year. A similar
impairment was recognised
in the previous year, with the
carrying value of investments
held impaired from £773.3m
to £708.2m.
Indefinite life consideration
In assessing whether the indefinite life judgement was appropriate, we examined management’s evaluation of the life of the intangible assets, considering criteria in International
Accounting Standard 38, “Intangible assets”. We found that the group has established digital capabilities and earns significant amounts of digital revenue which together supported
the principle of a potentially sustainable digital business without a finite life. In particular we found the group continues to develop its ‘data driven’ revenues, which have increased as
a proportion of overall digital revenue, and has made operational and strategic progress in developing its customer value strategy; both of which supported management’s position.
Impairment assessment
Appropriateness of a 10 year modelling period
We satisfied ourselves that it was valid, in the context of a business in a long term transition from print based to digital, to model over a longer period than the group’s budget and that
10 years was an appropriate period.
Key assumptions in the impairment model
We met with management to understand the basis of preparation of the FY24 budget, and challenged management to provide internal and market evidence for the key assumptions
(which we then evaluated and tested to source data and to our own external sources as relevant), including: historical trend data for circulation revenues (considering both volumes and
pricing), decline rates for print advertising, digital revenue growth rates, and cost reduction plans to mitigate inflationary factors. We paid specific attention to the group’s cost reduction
plans and its impact on the budget, and the group’s digital revenue budget.
In assessing the assumptions used, we also considered management’s historical forecasting accuracy, including the degree to which variances noted could have been forecast in
advance, and the degree to which changes in digital revenue growth assumptions would lead to an impairment of the group’s intangible assets.
We assessed the discount rates that management’s experts calculated using our valuations experts. They benchmarked the discount rates used and found that the rates used were
materially reasonable.
When considering print circulation revenue decline assumptions, we challenged management’s forecast of future changes to prices and whether the assumptions made were compatible with
the forecast declines in circulation volumes. Taking into account the group’s performance when compared to market analysis, we found the forecast decline in circulation revenue was reasonable.
When considering digital revenue growth assumptions, we considered the degree to which these took account of the events which led to a reduction in average UK page views per
month, with resulting reduction in digital revenue, and market analysis.
The revenue decline in FY23 was lower than the reduction in the number of page views because a focus on ‘data driven’ revenues and those less dependent on page views led to yields
increasing. These products allow Reach to secure a higher yield as a result of Reach’s ability to direct advertising to specific users or content. Revenue from these products are now 43%
of digital revenue and fell at a lower rate (4% decline) than digital revenue as a whole (15% decline). Considering management forecasts of future page views and market analysis, we
found the forecast future growth for digital revenue was reasonable.
We challenged management on the difference between the current market capitalisation and the outcome of the value in use model, after allowing for a reasonable control premium.
We evaluated management’s explanations as part of assessing the reasonableness of the assumptions used. For the parent company investment impairment consideration, we also
considered management’s approach to modelling past service pension contributions and compared this with the IAS 19 deficit and the funding commitments made with the Trustees
of the pension schemes and evaluated the relative merits of alternative approaches and their impact on the resulting carrying value. The pension amounts are included in the model
for the parent company investment impairment because the subsidiaries are required to fund these liabilities.
We found that the group’s impairment model supported the carrying value of the group’s intangible assets and was based on reasonable assumptions. We note that the headroom
in the impairment model has reduced compared to the prior year and that it is sensitive to changes in assumptions in the model, in particular, to the group’s ability to grow its digital
revenues to the scale forecast. We agree that the carrying value of the parent company’s investments is impaired and consider the charge recognised to be reasonable.
We also evaluated the group’s disclosures and sensitivity analysis in notes 3, 15 and 16 to the group financial statements and note 4 of the parent company financial statements.
We consider these to be appropriate.
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Key audit matter How our audit addressed the key audit matter
Provision for historical legal issues (group)
Refer to Note 3 for the key sources of estimation uncertainty, Note 27 for further details on
the provision recognised and page 101 for the views of the Audit & Risk Committee.
The Group has a provision of £18.2m in respect of historical legal issues as at 31 December
2023 (2022: £43.0m). The provision relates to a number of claims arising from suspected
phone hacking and unlawful information gathering in the past.
During 2023, a release of £20.2m (2022: charge of £11.0m) to the income statement was
recognised due to the Judgment handed down on 15 December 2023 in respect of claims
of four test claimants. As a result of the Judgment, management has determined that any
claims issued after 31 October 2020 are time-barred under the Limitation Act 1980, unless
individual claimants can demonstrate specific exceptional circumstances. Therefore, this
has significantly reduced the amounts that are expected to be settled with claimants.
As at 31 December 2023, there are now two parts to the provision: known claims and common
court costs. The basis for the known claims is the average of past settlements, depending on
the stage that the claim has reached. Common costs and generic costs are court costs
incurred which are based on information provided by a third party.
As expected by management and their legal advisors, the claimants have made an
appeal in the hearing held on 29 January 2024. Having read the skeleton argument, both
management and their legal advisors consider the likelihood of success to be remote. On
9 February 2024, the Judge refused permission for the claimants to appeal so the claimants
will now have to seek permission from the Court of Appeal. The claimants have 21 days from
that date to submit an appeal, but the outcome will not be known until later.
There was also a Judgment handed down on 9 February 2024 in relation to generic costs and
common costs. In terms of interim payments of costs, the Judgment states the claimants are
requesting that the Group pays the claimants’ common costs for the trial of the generic issues.
This provision for historical legal issues is recognised as a key source of estimation uncertainty.
The audit procedures we performed in respect of this matter included:
• Evaluating developments during the year and up to the date of this report, by holding meetings with
management, internal legal counsel, external legal counsel and those charged with governance. These
meetings enabled us to understand the impact of the Judgment on 15 December 2023 on time limitation
and damages and the Judgment on 9 February 2024 on generic costs and common costs. We corroborated
our understanding gained through discussion with external legal counsel and with our internal legal expert
throughout the audit process. We challenged management as to how these developments had been
incorporated into the calculation of the provision.
• Testing the calculation of the provision. This included, on a sample basis, agreeing previously settled claim
values to supporting agreements and amounts paid by the Group. The averages of the settlement values
were used by management as the basis for calculating the year-end provision.
• Assessing the completeness of the provision through testing management’s exercise to determine the
likelihood of the appeal by claimants being successful.
• Evaluating whether management’s methods and assumptions for calculating the provision adequately allows
for: the nature of current claims (excluding letters before action and issued claims which are now time-
barred), the value that current claims are being settled at and current claim management strategies.
There is subjectivity and continuing uncertainty involved in estimating this provision. However, based on the
audit procedures performed we concluded the amount provided as at 31 December 2023 was reasonable.
We also evaluated the related disclosures included in notes 3 and 27 to the group financial statements by
reference to the audit procedures outlined above. We consider them to be appropriate. We concur with
management’s view that any further contingent liability is deemed remote.
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Key audit matter How our audit addressed the key audit matter
Valuation of pension liabilities and pension assets (group)
Refer to Note 3 for the directors’ disclosure on the critical accounting judgements
and key sources of estimation uncertainty, Note 21 for details of the schemes and
amounts recognised in respect of defined benefit pension schemes and page 101
for the views of the Audit & Risk Committee.
Pensions obligations are significant in the context of the overall balance sheet of the
group. The group has six defined benefit pension plans which comprise total pension
liabilities of £1,835.6m (2022: £1,860.0m). The net pension deficit (pre deferred tax) on
the consolidated balance sheet is £102.8m (2022: £149.7m).
The valuation of the schemes’ liabilities requires a significant level of judgement
and the Audit & Risk Committee has therefore highlighted this key audit matter
as a significant financial issue in their report.
The following factors have led to us classifying pension liabilities as a key audit matter:
• Determining the assumptions to be applied requires technical expertise.
• Changes in a significant assumption can have a material impact on the overall
defined benefit obligation and ultimately the net asset/liability which sits in the
balance sheet.
• Developing actuarial models and selecting appropriate assumptions to estimate
the present value of the pension liabilities is complex. Specialist actuarial knowledge
is required to understand this process and to critically assess the output.
The total scheme assets across the six schemes totalled £1,733.0m (2022: £1,710.3m).
Approximately 42% of the total assets are held in pooled investment vehicles (“PIVs”),
of which approximately 30% are considered more complex.
PIVs categorised as “more complex” require additional audit work to ensure that
the year-end valuation is appropriate. The complex categorisation is linked to the
underlying assets, pricing frequency, location of the fund as well as any trading
restrictions. Where a significant proportion of the underlying assets of the funds being
level 2 or 3 and as such there is no observable market price, the fund is not priced
frequently (i.e. either daily or weekly) or there are restrictions over the purchase or sale
of the units or underlying asset of the fund, there are therefore added complexities
involved in determining an appropriate fair value at the year end. Where a
combination of these factors exist, the fund is classified as more complex.
We reviewed the pension assumptions, including, but not limited to the key assumptions: discount rates,
inflation and mortality. In doing this we utilised our expert actuarial team and considered and challenged the
reasonableness of the actuarial assumptions against our internally developed benchmark ranges, finding them
to be within a materially acceptable range.
We verified that the valuation of the pension liabilities is reasonable based on the following:
• Reviewing the methodology used to determine the liabilities. Our expert actuarial team has built up a detailed
understanding of this methodology through meetings with the group’s actuary and management. The group’s
discount rates were found to be, on average, towards the optimistic end of our range having been, on average,
in the middle of the range at the previous year end. Inflation rates used were found to be reasonable.
• Testing that the movement in the liabilities over the financial year is reasonable. Our expert actuarial team
supported us in reviewing these movements. They concluded that the movements and resulting liability
values were materially reasonable.
• Examining the membership data which drives the year-end liability calculation was examined for all
six schemes to confirm that the data was complete and accurate. No issues were noted with the testing
performed. The liabilities have been updated to reflect the 2022 funding valuations for MGN, TRBS, MINPS and
EN88,whereas WFPPS and ENSM schemes continue to be based off the 2019 funding valuation and adjusted for
events since 2019. This rollforward was assessed by our expert actuarial team who concluded the approach
followed complied with the requirements of IAS 19 and noted no material exceptions.
We verified that the valuation of the more complex pooled investment vehicles (PIVs) is reasonable based on
the following:
• Independent investment manager confirmations were obtained for all material PIVs. The total value was
agreed to the group’s asset listing.
• An assessment was performed on each PIV to determine whether it is straightforward or more complex in
nature. More complex funds are subject to additional procedures and evidence obtained to corroborate the
valuation. This included, where available, a review of the transactions surrounding the year end to establish
the completeness and accuracy of the valuation, obtaining and reviewing the investment manager’s latest
internal controls report to assess any issues with the control environment or exceptions noted with controls
relating to the valuation of assets (and obtaining bridging letters for any gap between the report and the
year end).
The latest fund financial statements were also obtained and reviewed in comparison with unaudited statements
as at the same date, to understand any updates to valuations, once the fund audit is complete, indicating
issues with the valuation process.
All evidence received regarding the valuation of PIVs was reviewed to ensure it did not contradict the year end
valuation and we considered if there were any indications of valuation uncertainty. No issues were identified in
the testing performed.
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How we tailored the audit scope
We tailored the scope of our audit to ensure
that we performed enough work to be able to
give an opinion on the financial statements as
a whole, taking into account the structure of
the group and the company, the accounting
processes and controls, and the industry in
which they operate.
The group operates from a number of locations
in the UK. From a financial reporting perspective,
the most significant are the group’s London
office and headquarters, its Liverpool shared
service centre and the operational centre of
its print activities in Watford. The group’s core
publishing operations are accounted for
through the Liverpool shared service centre
and in a single general ledger, that is then
disaggregated for statutory reporting
requirements. Our group audit scope focused
on the core publishing operations and the
parent company, which account for over 99%
of the group’s revenue. The materiality level
applied in our audit of the two component
entities was £4.36m. At the parent company
level, we also tested the consolidation process,
tax and pensions.
The impact of climate risk on our audit
As part of our audit we made enquiries of
management to understand the process
they have adopted to assess the extent of
the potential impact of climate change risk on
the group’s financial statements. In addition to
these enquiries, we also read Reach’s external
reporting including its 2023 Carbon Disclosure
Project public submission.
Management has assessed the key risks and
opportunities for the group and has begun
to quantify the financial impact of the most
material climate-related risks within the
Annual Report. They have noted that climate
risks identified and their environmental
sustainability related targets and
commitments may impact future forecasts,
such as those used when considering if
assets are impaired.
Using our knowledge of the business, we
evaluated management’s risk assessment and
their assessment of the impact of climate risks
identified and their environmental sustainability
related targets and commitments on
the discounted cash flow model used by
management to assess whether the group’s
publishing rights and titles and the parent
company’s investment are impaired.
We also considered the consistency of
the disclosures in relation to climate change
(including the disclosures in the Task Force on
Climate-related Financial Disclosures (TCFD)
section) within the Annual Report with the
financial statements and our knowledge
obtained from our audit.
Our procedures did not identify any material
impact in the context of our audit of the
financial statements as a whole, or our key
audit matters for the 53 week period ended
31 December 2023.
Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative
thresholds for materiality. These, together with qualitative considerations, helped us to determine
the scope of our audit and the nature, timing and extent of our audit procedures on the individual
financial statement line items and disclosures and in evaluating the effect of misstatements, both
individually and in aggregate on the financial statements as a whole.
Based on our professional judgement, we determined materiality for the financial statements as a
whole as follows:
Financial statements – group
Financial statements –
company
Overall materiality £4.90m (2022: £5.70m). £6.00m (2022: £7.90m).
How we determined it 5% of a three year average of profit
before tax and before impairment
charges and reversals, significant
restructuring charges and costs
associated with historical legal issues
1% of total assets
Rationale for
benchmark applied
Based on the benchmarks used in
the annual report, profit before tax
is the primary measure used by
the shareholders in assessing the
performance of the group and is a
generally accepted auditing benchmark.
This has been adjusted for significant
restructuring charges, impairment
charges and reversals and costs
associated with historical legal issues,
consistent with previous years. A number
of external events during the period
have led to volatility in the group’s
results and so we have used a three
year average in determining materiality
for the current period.
As the parent entity, Reach plc
is essentially a holding company
for the group and therefore the
materiality benchmark has been
determined to be based on total
assets, which is a generally
accepted auditing benchmark.
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For each component in the scope of our
group audit, we allocated a materiality that
is less than our overall group materiality. The
materiality allocated to both components was
£4.36m. Certain components were audited to
a local statutory audit materiality that was
also less than our overall group materiality.
We use performance materiality to reduce to
an appropriately low level the probability that
the aggregate of uncorrected and undetected
misstatements exceeds overall materiality.
Specifically, we use performance materiality
in determining the scope of our audit and the
nature and extent of our testing of account
balances, classes of transactions and
disclosures, for example in determining
sample sizes. Our performance materiality
was 75% (2022: 75%) of overall materiality,
amounting to £3.74m (2022: £4.27m) for the
group financial statements and £4.50m
(2022: £5.93m) for the company
financial statements.
In determining the performance materiality,
we considered a number of factors – the
history of misstatements, risk assessment
and aggregation risk and the effectiveness
of controls – and concluded that an
amount at the upper end of our normal
range was appropriate.
We agreed with the Audit & Risk Committee
that we would report to them misstatements
identified during our audit above £249k (group
audit) (2022: £285k) and £300k (company
audit) (2022: £395k) as well as misstatements
below those amounts that, in our view,
warranted reporting for qualitative reasons.
Conclusions relating to going concern
Our evaluation of the directors’ assessment
of the group’s and the company’s ability to
continue to adopt the going concern basis
of accounting included:
• Evaluating the going concern cash
flow model, including agreeing amounts
included to internal forecasts and assessing
the reasonableness of these forecasts
• Evaluating the working capital movements
and other cash items such as pension and
tax cash outflows included in the cash
flow model
• Reading the revolving credit facility
agreement and agreeing key terms such
as length of facility and covenants used
in management’s assessment to
the agreement
• Evaluating the forecast available facility
headroom and compliance with financial
covenants during the going concern
assessment period. This included
considering the appropriateness of
management’s downside scenarios and
the adequacy of headroom in this scenario.
Based on the work we have performed, we
have not identified any material uncertainties
relating to events or conditions that,
individually or collectively, may cast significant
doubt on the group’s and the company’s
ability to continue as a going concern for a
period of at least twelve months from when
the financial statements are authorised
for issue.
In auditing the financial statements, we have
concluded that the directors’ use of the going
concern basis of accounting in the preparation
of the financial statements is appropriate.
However, because not all future events or
conditions can be predicted, this conclusion
is not a guarantee as to the group’s and
the company’s ability to continue as a
going concern.
In relation to the directors’ reporting on
how they have applied the UK Corporate
Governance Code, we have nothing material
to add or draw attention to in relation to
the directors’ statement in the financial
statements about whether the directors
considered it appropriate to adopt the
going concern basis of accounting.
Our responsibilities and the responsibilities of
the directors with respect to going concern
are described in the relevant sections of
this report.
Reporting on other information
The other information comprises all of the
information in the Annual Report other than
the financial statements and our auditors’
report thereon. The directors are responsible
for the other information. Our opinion on the
financial statements does not cover the other
information and, accordingly, we do not
express an audit opinion or, except to the
extent otherwise explicitly stated in this
report, any form of assurance thereon.
In connection with our audit of the financial
statements, our responsibility is to read the
other information and, in doing so, consider
whether the other information is materially
inconsistent with the financial statements
or our knowledge obtained in the audit, or
otherwise appears to be materially misstated.
If we identify an apparent material
inconsistency or material misstatement,
we are required to perform procedures
to conclude whether there is a material
misstatement of the financial statements
or a material misstatement of the other
information. If, based on the work we
have performed, we conclude that there
is a material misstatement of this other
information, we are required to report that
fact. We have nothing to report based on
these responsibilities.
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With respect to the Strategic report and
Directors’ report, we also considered whether
the disclosures required by the UK Companies
Act 2006 have been included.
Based on our work undertaken in the course of
the audit, the Companies Act 2006 requires us
also to report certain opinions and matters as
described below.
Strategic report and Directors’ report
In our opinion, based on the work undertaken in
the course of the audit, the information given in
the Strategic report and Directors’ report for the
period ended 31 December 2023 is consistent
with the financial statements and has been
prepared in accordance with applicable legal
requirements.
In light of the knowledge and understanding
of the group and company and their
environment obtained in the course of
the audit, we did not identify any material
misstatements in the Strategic report and
Directors’ report.
Directors’ Remuneration
In our opinion, the part of the Remuneration
Report to be audited has been properly
prepared in accordance with the
Companies Act 2006.
Corporate governance statement
The Listing Rules require us to review the
directors’ statements in relation to going
concern, longer-term viability and that part of
the corporate governance statement relating
to the company’s compliance with the
provisions of the UK Corporate Governance
Code specified for our review. Our additional
responsibilities with respect to the corporate
governance statement as other information
are described in the Reporting on other
information section of this report.
Based on the work undertaken as part of
our audit, we have concluded that each
of the following elements of the corporate
governance statement is materially consistent
with the financial statements and our
knowledge obtained during the audit, and
we have nothing material to add or draw
attention to in relation to:
• The directors’ confirmation that they have
carried out a robust assessment of the
emerging and principal risks;
• The disclosures in the Annual Report
that describe those principal risks, what
procedures are in place to identify emerging
risks and an explanation of how these are
being managed or mitigated;
• The directors’ statement in the financial
statements about whether they considered
it appropriate to adopt the going concern
basis of accounting in preparing them,
and their identification of any material
uncertainties to the group’s and company’s
ability to continue to do so over a period of
at least twelve months from the date of
approval of the financial statements;
• The directors’ explanation as to their
assessment of the group’s and company’s
prospects, the period this assessment
covers and why the period is appropriate;
and
• The directors’ statement as to whether
they have a reasonable expectation that
the company will be able to continue in
operation and meet its liabilities as they
fall due over the period of its assessment,
including any related disclosures drawing
attention to any necessary qualifications
or assumptions.
Our review of the directors’ statement
regarding the longer-term viability of the group
and company was substantially less in scope
than an audit and only consisted of making
inquiries and considering the directors’ process
supporting their statement; checking that the
statement is in alignment with the relevant
provisions of the UK Corporate Governance
Code; and considering whether the statement
is consistent with the financial statements and
our knowledge and understanding of the group
and company and their environment obtained
in the course of the audit.
In addition, based on the work undertaken
as part of our audit, we have concluded
that each of the following elements of the
corporate governance statement is materially
consistent with the financial statements and
our knowledge obtained during the audit:
• The directors’ statement that they consider
the Annual Report, taken as a whole, is fair,
balanced and understandable, and
provides the information necessary for
the members to assess the group’s and
company’s position, performance, business
model and strategy;
• The section of the Annual Report that
describes the review of effectiveness of risk
management and internal control systems;
and
• The section of the Annual Report describing
the work of the Audit & Risk Committee.
We have nothing to report in respect of our
responsibility to report when the directors’
statement relating to the company’s
compliance with the Code does not properly
disclose a departure from a relevant provision
of the Code specified under the Listing Rules
for review by the auditors.
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Responsibilities for the financial
statements and the audit
Responsibilities of the directors for
the financial statements
As explained more fully in the Statement
of directors’ responsibilities in respect of
the financial statements, the directors are
responsible for the preparation of the financial
statements in accordance with the applicable
framework and for being satisfied that they
give a true and fair view. The directors are
also responsible for such internal control as
they determine is necessary to enable the
preparation of financial statements that are
free from material misstatement, whether
due to fraud or error.
In preparing the financial statements, the
directors are responsible for assessing the
group’s and the company’s ability to continue
as a going concern, disclosing, as applicable,
matters related to going concern and using
the going concern basis of accounting unless
the directors either intend to liquidate the
group or the company or to cease operations,
or have no realistic alternative but to do so.
Auditors’ responsibilities for the audit of the
financial statements
Our objectives are to obtain reasonable
assurance about whether the financial
statements as a whole are free from material
misstatement, whether due to fraud or error,
and to issue an auditors’ report that includes
our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee
that an audit conducted in accordance
with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements
can arise from fraud or error and are
considered material if, individually or in
the aggregate, they could reasonably
be expected to influence the economic
decisions of users taken on the basis of
these financial statements.
Irregularities, including fraud, are instances of
non-compliance with laws and regulations.
We design procedures in line with our
responsibilities, outlined above, to detect
material misstatements in respect of
irregularities, including fraud. The extent
to which our procedures are capable of
detecting irregularities, including fraud,
is detailed below.
Based on our understanding of the group and
industry, we identified that the principal risks of
non-compliance with laws and regulations
related to employment law, data privacy
law and the Listing Rules of the UK Financial
Conduct Authority, and we considered the
extent to which non-compliance might have
a material effect on the financial statements.
We also considered those laws and regulations
that have a direct impact on the financial
statements such as UK tax legislation and
the Companies Act 2006. We evaluated
management’s incentives and opportunities
for fraudulent manipulation of the financial
statements (including the risk of override of
controls), and determined that the principal
risks were related to management’s estimates
and the posting of inappropriate journal
entries so as to manipulate revenue
(particularly digital revenue) and expenditure
or to conceal the misappropriation of cash.
Audit procedures performed by the
engagement team included:
• Discussions with management, internal
audit and the group’s legal advisors,
including consideration of known or
suspected instances of non-compliance
with laws and regulation and fraud.
• Requesting legal confirmations from
external lawyers and reviewing the
nature of legal expenses.
• Challenging assumptions and judgements
made by management in their significant
accounting estimates, including impairment
of intangible assets and investments and
the provision for historical legal issues as
explained in the key audit matters above.
• Identifying and testing journal entries to
address the risk of inappropriate journal
entries being posted, as referred to above.
• With regards to data privacy law,
procedures in respect of historical legal
issues set out in the key audit matter above.
• Assessing the classification of items as
adjusting within the determination of
adjusted profit.
• Assessing financial statement disclosures
and agreeing these to underlying
supporting documentation for
compliance with laws and regulations.
There are inherent limitations in the audit
procedures described above. We are less
likely to become aware of instances of
non-compliance with laws and regulations
that are not closely related to events and
transactions reflected in the financial
statements. Also, the risk of not detecting a
material misstatement due to fraud is higher
than the risk of not detecting one resulting
from error, as fraud may involve deliberate
concealment by, for example, forgery or
intentional misrepresentations, or
through collusion.
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Our audit testing might include testing
complete populations of certain transactions
and balances, possibly using data auditing
techniques. However, it typically involves
selecting a limited number of items for testing,
rather than testing complete populations.
We will often seek to target particular items
for testing based on their size or risk
characteristics. In other cases, we will
use audit sampling to enable us to draw
a conclusion about the population from
which the sample is selected.
A further description of our responsibilities for
the audit of the financial statements is located
on the FRC’s website at: www.frc.org.uk/
auditorsresponsibilities. This description forms
part of our auditors’ report.
Use of this report
This report, including the opinions, has been
prepared for and only for the company’s
members as a body in accordance with
Chapter 3 of Part 16 of the Companies Act
2006 and for no other purpose. We do not,
in giving these opinions, accept or assume
responsibility for any other purpose or to any
other person to whom this report is shown or
into whose hands it may come save where
expressly agreed by our prior consent
in writing.
Other required reporting
Companies Act 2006
exception reporting
Under the Companies Act 2006 we are
required to report to you if, in our opinion:
• we have not obtained all the information
and explanations we require for our audit; or
• adequate accounting records have not
been kept by the company, or returns
adequate for our audit have not been
received from branches not visited by us; or
• certain disclosures of directors’
remuneration specified by law are
not made; or
• the company financial statements and
the part of the Remuneration Report to
be audited are not in agreement with
the accounting records and returns.
We have no exceptions to report arising from
this responsibility.
Appointment
Following the recommendation of the Audit &
Risk Committee, we were appointed by the
members on 7 June 2019 to audit the financial
statements for the year ended 29 December
2019 and subsequent financial periods. The
period of total uninterrupted engagement
is 5 years, covering the years ended
29 December 2019 to 31 December 2023.
Other matter
In due course, as required by the Financial
Conduct Authority Disclosure Guidance and
Transparency Rule 4.1.14R, these financial
statements will form part of the ESEF-prepared
annual financial report filed on the National
Storage Mechanism of the Financial Conduct
Authority in accordance with the ESEF Regulatory
Technical Standard (‘ESEF RTS’). This auditors’
report provides no assurance over whether the
annual financial report will be prepared using the
single electronic format specified in the ESEF RTS.
Colin Bates (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
5 March 2024
144
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 142
Independent auditors’ report to the members of Reach plc continued
Reach plc Annual Report 2023 145
Consolidated income statement
for the 53 weeks ended 31 December 2023 (52 weeks ended 25 December 2022)
Adjusted | Adjusted | ||||||
| Adjusted | items | Statutory | Adjusted | items | Statutory | ||
| 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | ||
notes | £m | £m | £m | £m | £m | £m | |
Revenue | 5 | ||||||
Cost of sales | ( | ( | ( | ( | |||
Gross profit | |||||||
Distribution costs | ( | ( | ( | ( | |||
Administrative expenses | 8 | ( | ( | ( | ( | ( | ( |
Share of results of associates | 20 | ( | ( | ||||
Operating profit | 6 | ( | ( | ||||
Interest income | 9 | ||||||
Finance costs | 10 | ( | ( | ( | ( | ||
Pension finance charge | 21 | ( | ( | ( | ( | ||
Profit before tax | ( | ( | |||||
Tax charge | 11 | ( | ( | ( | ( | ||
Profit for the period attributable to equity holders of the parent | ( | ( | |||||
2023 | 2023 | 2022 | 2022 | ||||
Earnings per share | notes | Pence | Pence | Pence | Pence | ||
Earnings per share – basic | 13 | ||||||
Earnings per share – diluted | 13 |
The above results were derived from continuing operations. Set out in note 35 is the reconciliation between the statutory and adjusted results.
145
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 146
Consolidated statement of comprehensive income
for the 53 weeks ended 31 December 2023 (52 weeks ended 25 December 2022)
2023 | 2022 | ||
notes | £m | £m | |
Profit for the period | |||
Items that will not be reclassified to profit and loss: | |||
Actuarial loss on defined benefit pension schemes | 21 | ( | ( |
Tax on actuarial loss on defined benefit pension schemes | 11 | ||
Share of items recognised by associates after tax | 20 | ( | |
Other comprehensive loss for the period | ( | ||
Total comprehensive income for the period |
Consolidated statement of changes in equity
for the 53 weeks ended 31 December 2023 (52 weeks ended 25 December 2022)
(Accumulated | ||||||
| Share | Capital | loss )/retained | ||||
| Share | premium | Merger | redemption | earnings and | ||
| capital | account | reserve | reserve | other reserves | Total | |
£m | £m | £m | £m | £m | £m | |
At 27 December 2021 | ( | |||||
Profit for the period | ||||||
Other comprehensive loss for the period | ( | ( | ||||
Total comprehensive income for the period | ||||||
Purchase of own shares (note 29) | ( | ( | ||||
Credit to equity for equity-settled share-based payments | ||||||
Deferred tax charge for equity-settled share-based payments (note 28) | ( | ( | ||||
Dividends paid | ( | ( | ||||
At 25 December 2022 | ( | |||||
Profit for the period | ||||||
Other comprehensive loss for the period | ||||||
Total comprehensive income for the period | ||||||
Credit to equity for equity-settled share-based payments | ||||||
Dividends paid (note 12) | ( | ( | ||||
Capital reduction (note 31) | ( | |||||
At 31 December 2023 |
146
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Reach plc Annual Report 2023 146
Consolidated statement of comprehensive income
for the 53 weeks ended 31 December 2023 (52 weeks ended 25 December 2022)
notes
2023
£m
2022
£m
Profit for the period
21.5
52.3
Items that will not be reclassified to profit and loss:
Actuarial loss on defined benefit pension schemes
21
(0.5)
(35.0)
Tax on actuarial loss on defined benefit pension schemes
11
0.1
7.4
Share of items recognised by associates after tax
20
0.4
(1.7)
Other comprehensive loss for the period
–
(29.3)
Total comprehensive income for the period
21.5
23.0
Consolidated statement of changes in equity
for the 53 weeks ended 31 December 2023 (52 weeks ended 25 December 2022)
Share
capital
£m
Share
premium
account
£m
Merger
reserve
£m
Capital
redemption
reserve
£m
(Accumulated
loss
)/retained
earnings and
other reserves
£m
Total
£m
At 27 December 2021
32.2
605.4
17.4
4.4
(20.6)
638.8
Profit for the period
–
–
–
–
52.3
52.3
Other comprehensive loss for the period
–
–
–
–
(29.3)
(29.3)
Total comprehensive income for the period
–
–
–
–
23.0
23.0
Purchase of own shares (note 29)
–
–
–
–
(1.0)
(1.0)
Credit to equity for equity-settled share-based payments
–
–
–
–
1.8
1.8
Deferred tax charge for equity-settled share-based payments (note 28)
–
–
–
–
(2.2)
(2.2)
Dividends paid
–
–
–
–
(22.9)
(22.9)
At 25 December 2022
32.2
605.4
17.4
4.4
(21.9)
637.5
Profit for the period
–
–
–
–
21.5
21.5
Other comprehensive loss for the period
–
–
–
–
–
–
Total comprehensive income for the period
–
–
–
–
21.5
21.5
Credit to equity for equity-settled share-based payments
–
–
–
–
1.3
1.3
Dividends paid (note 12)
–
–
–
–
(23.1)
(23.1)
Capital reduction (note 31)
–
(605.4)
–
–
605.4
–
At 31 December 2023
32.2
–
17.4
4.4
583.2
637.2
Reach plc Annual Report 2023 147
Consolidated cash flow statement
for the 53 weeks ended 31 December 2023 (52 weeks ended 25 December 2022)
2023 | 2022 | ||
notes | £m | £m | |
Cash flows from operating activities | |||
Cash generated from operations | 14 | ||
Pension deficit funding payments | 21 | ( | ( |
Income tax paid | ( | ( | |
Net cash inflow from operating activities | |||
Investing activities | |||
Interest received | 9 | ||
Dividends received from associated undertakings | 20 | ||
Proceeds on disposal of property, plant and equipment | |||
Purchases of property, plant and equipment | ( | ( | |
Expenditure on capitalised internally generated development | 16 | ( | ( |
Interest received on leases | 19 | ||
Finance lease receipts | 19 | ||
Deferred consideration payment | 24 | ( | ( |
Net cash used in investing activities | ( | ( | |
Financing activities | |||
Interest and charges paid on borrowings | ( | ( | |
Dividends paid | 12 | ( | ( |
Interest paid on leases | 19 | ( | ( |
Repayment of obligation under leases | 19 | ( | ( |
Purchase of own shares | 29 | ( | |
Drawdown of borrowings | 24 | ||
Net cash used in financing activities | ( | ( | |
Net decrease in cash and cash equivalents | ( | ( | |
Cash and cash equivalents at the beginning of the period | 24 | ||
Cash and cash equivalents at the end of the period | 24 |
147
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Reach plc Annual Report 2023 148
Consolidated balance sheet
at 31 December 2023 (at 25 December 2022)
2023 | 2022 | ||
notes | £m | £m | |
Non-current assets | |||
Goodwill | 15 | ||
Other intangible assets | 16 | ||
Property, plant and equipment | 17 | ||
Right-of-use assets | 18 | ||
Finance lease receivable | 19 | ||
Investment in associates | 20 | ||
Retirement benefit assets | 21 | ||
Current assets | |||
Inventories | 22 | ||
Trade and other receivables | 23 | ||
Current tax receivable | 11 | ||
Finance lease receivable | 19 | ||
Cash and cash equivalents | 24 | ||
Assets classified as held for sale | 25 | ||
Total assets | |||
Non-current liabilities | |||
Trade and other payables | 26 | ( | ( |
Lease liabilities | 19 | ( | ( |
Retirement benefit obligations | 21 | ( | ( |
Provisions | 27 | ( | ( |
Deferred tax liabilities | 28 | ( | ( |
( | ( | ||
Current liabilities | |||
Trade and other payables | 26 | ( | ( |
Deferred consideration | 24 | ( | |
Borrowings | 24 | ( | ( |
Lease liabilities | 19 | ( | ( |
Provisions | 27 | ( | ( |
( | ( | ||
Total liabilities | ( | ( | |
Net assets |
2023 | 2022 | ||
notes | £m | £m | |
Equity | |||
Share capital | 29,30 | ||
Share premium account | 29,31 | ||
Merger reserve | 29 | ||
Capital redemption reserve | 29 | ||
Retained earnings/(accumulated loss) and other reserves | 29 | ( | |
Total equity attributable to equity holders | |||
of the parent |
148
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Reach plc Annual Report 2023 148
Consolidated balance sheet
at 31 December 2023 (at 25 December 2022)
notes
2023
£m
2022
£m
Non-current assets
Goodwill
15
35.9
35.9
Other intangible assets
16
840.8
832.9
Property, plant and equipment
17
113.6
140.1
Right-of-use assets
18
13.0
10.9
Finance lease receivable
19
–
10.4
Investment in associates
20
14.5
14.6
Retirement benefit assets
21
66.0
51.2
1,083.8
1,096.0
Current assets
Inventories
22
11.4
12.9
Trade and other receivables
23
85.1
95.2
Current tax receivable
11
8.1
13.9
Finance lease receivable
19
–
0.6
Cash and cash equivalents
24
19.9
40.4
124.5
163.0
Assets classified as held for sale
25
11.0
–
135.5
163.0
Total assets
1,219.3
1,259.0
Non-current liabilities
Trade and other payables
26
(1.1)
(4.5)
Lease liabilities
19
(28.5)
(26.8)
Retirement benefit obligations
21
(168.8)
(202.1)
Provisions
27
(26.6)
(36.6)
Deferred tax liabilities
28
(200.1)
(191.6)
(425.1)
(461.6)
Current liabilities
Trade and other payables
26
(96.2)
(106.7)
Deferred consideration
24
–
(7.0)
Borrowings
24
(30.0)
(15.0)
Lease liabilities
19
(4.7)
(4.9)
Provisions
27
(26.1)
(26.3)
(157.0)
(159.9)
Total liabilities
(582.1)
(621.5)
Net assets
637.2
637.5
notes
2023
£m
2022
£m
Equity
Share capital
29,30
32.2
32.2
Share premium account
29,31
–
605.4
Merger reserve
29
17.4
17.4
Capital redemption reserve
29
4.4
4.4
Retained earnings/(accumulated loss) and other reserves
29
583.2
(21.9)
Total equity attributable to equity holders
of the parent
637.2
637.5
These consolidated financial statements on pages 145 to 187 were approved by the Board of
directors and authorised for issue on 5 March 2024.
They were signed on its behalf by:
Jim Mullen
Darren Fisher
Chief Executive Officer
Chief Financial Officer
Reach plc Annual Report 2023 149
Notes to the consolidated financial statements
for the 53 weeks ended 31 December 2023 (52 weeks ended 25 December 2022)
1 General information
Company is incorporated and domiciled in England and Wales
is 82548. The address of the registered office is One Canada Square, Canary Wharf, London E14 5AP .
The principal activities of the Group are discussed in the Strategic Report on pages 1 to 73.
These consolidated financial statements were approved for issue by the Board of directors on
5 March 2024. The Annual Report for the 53 weeks ended 31 December 2023 will be available on
the Company’s website at www.reachplc.com and at the Company’s registered office at One
Canada Square, Canary Wharf, London E14 5AP before the end of March 2024 and will be sent to
shareholders who have elected to receive a hard copy with the documents for the Annual General
Meeting to be held on 2 May 2024.
The Company presents the results on a statutory and adjusted basis and revenue trends on a
statutory and like-for-like basis as described in note 3.
For administrative convenience, the consolidated financial statements are made up to a suitable
date near the end of the calendar year. These consolidated financial statements have been
prepared for the 53 weeks ended 31 December 2023 and the comparative period has been
prepared for the 52 weeks ended 25 December 2022.
2 Adoption of new and revised standards
3 Accounting policies
The principal accounting policies adopted in the preparation of these consolidated financial
statements are set out below. These policies have been consistently applied to all years presented.
The Group also opts to present cash flows relating to the use of its revolving credit facility net where
the loans drawn down through use of the facility are repaid within three months of the initial
draw down.
149
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Notes to the consolidated financial statements continued
3 Accounting policies continued
Going concern continued
150
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Reach plc Annual Report 2023 150
Notes to the consolidated financial statements continued
3 Accounting policies continued
Going concern continued
• The impact on our business of key suppliers (in particular newsprint) being unable to meet their
obligations to the Group;
• The impact on our business of key customers being unable to meet their obligations for services
provided by the Group;
• The deficit funding contributions to the defined benefit pension schemes and payments in
respect of historical legal issues; and
• The available cash reserves and committed finance facilities available to the Group. The Group
has an expiry date for its £120.0m facility of 19 November 2026. The Group has drawn down
£30.0m on the facility at the reporting date.
Having considered all the factors impacting the Group’s businesses, including downside
sensitivities (relating to trading and cash flow), the directors are satisfied that the Company and
the Group will be able to operate within the terms and conditions of the Group’s financing facilities
for the foreseeable future.
The directors have reasonable expectations that the Company and the Group have adequate
resources to continue in operational existence for the foreseeable future, which comprises the
period of at least 12 months from the date of approval of the financial statements. Accordingly,
they continue to adopt the going concern basis in preparing the Group’s annual consolidated
financial statements and the Company’s parent company financial statements.
Basis of accounting
These consolidated financial statements have been prepared in accordance with UK-adopted
international accounting standards. The consolidated financial statements have been prepared
under the historical cost convention, except for the following:
• assets held for sale – measured at the lower of carrying amount and fair value less costs to sell;
• defined benefit pension schemes – plan assets measured at fair value.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of Reach plc and all
entities controlled by it for the 53 weeks ended 31 December 2023. Control is achieved where the
Company has the power to govern the financial and operating policies of the investee entity, has
the rights to variable returns from its involvement with the investee and has the ability to use its
power to affect its returns. All intra-group transactions, balances, income and expenses are
eliminated on consolidation.
On the acquisition of a business, including an interest in an associated undertaking or a joint
venture, fair values are attributed to the Group’s share of the identifiable assets and liabilities of
the business existing at the date of acquisition and reflecting the conditions as at that date. Where
necessary, adjustments are made to the financial statements of businesses acquired to bring
their accounting policies in line with those used in the preparation of the consolidated financial
statements. Results of businesses are included in the consolidated income statement from
the effective date of acquisition and in respect of disposals up to the effective date of
relinquishing control.
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over
the Group’s interest in the fair value of the identifiable assets and liabilities of the entity recognised
at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently
measured at cost less any accumulated impairment losses. Negative goodwill arising on an
acquisition is recognised directly in the consolidated income statement upon acquisition. On
disposal of a subsidiary or associate, the remaining amount of goodwill is included in the
determination of the profit or loss on disposal.
Goodwill is reviewed for impairment either annually or more frequently if events or changes in
circumstances indicate a possible decline in the carrying value. For the purpose of impairment
testing, assets are grouped at the lowest levels for which there are separately identifiable cash
flows, known as cash-generating units. If the recoverable amount of the cash-generating unit
is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the
carrying amount of any goodwill allocated to the unit and then to the other assets of the unit,
pro-rated on the basis of the carrying amount of each asset in the unit, but subject to not
reducing any asset below its recoverable amount. An impairment loss recognised for goodwill
is not reversed in a subsequent period.
The Group has one cash-generating unit relating to Publishing. All goodwill at the reporting date
relates to Publishing.
Reach plc Annual Report 2023 151
Notes to the consolidated financial statements continued
3 Accounting policies continued
151
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 152
Notes to the consolidated financial statements continued
3 Accounting policies continued
Other intangible assets continued
152
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Reach plc Annual Report 2023 152
Notes to the consolidated financial statements continued
3 Accounting policies continued
Other intangible assets continued
Circulation revenue
The Group sells newspapers and magazines through wholesalers on a sale and return basis.
Revenue is recognised when the performance obligation has been fulfilled, being when the
publication has been delivered to the wholesaler. Revenue is measured at cover price less
the contractual wholesaler and retailer margins.
Print advertising revenue
Print advertising revenue includes digital classified revenue which is predominantly upsold from
print advertising. Revenue comprises third-party clients and agency contracts. The performance
obligation is fulfilled, and revenue is recognised, on publication of the advert. If an advertising
campaign is over a period of time, revenue is recognised on a straight-line basis over the period
of the campaign reflecting the pattern in which the performance obligation is fulfilled. Revenue is
measured at the transaction price in the contract. Rebates are recognised based on the level of
third-party spend over the contract period. Rebates are only recognised where the third party
has a clear entitlement to the receipt of the rebate and a reliable estimate can be made.
Printing revenue
Printing revenue mainly comprises third-party printing contracts. Printing revenue is recognised
at a point when the service is provided and the performance obligation is fulfilled. Revenue is
measured at the transaction price in the contract.
Print other revenue
Print other revenue includes contract publishing, syndication and events. Within print other revenue,
the performance obligation is fulfilled, and revenue is recognised, on publication of the product or
holding of the event, or when the goods have been purchased by a reader or at a point when the
service is provided and the performance obligation is fulfilled. Revenue is measured at the
transaction price in the contract.
Digital revenue
For digital display advertising revenue, the performance obligation is fulfilled, and revenue is
recognised, on publication of the advert. If an advertising campaign is over a period of time,
revenue is recognised over the period of the online campaign on a straight-line basis or pages
served basis reflecting the pattern in which the performance obligation is fulfilled. For digital
transaction revenue, the performance obligation is fulfilled, and revenue is recognised, when
the service is provided. Revenue is measured at the transaction price in the contract.
Leases
The Group as a lessee
Leases are recognised on the balance sheet as a right-of-use asset and corresponding liability
at the date at which a leased asset is made available for use by the Group, except for short-term
leases (defined as leases with a lease term of 12 months or less) and leases of low-value assets.
For these leases, the Group recognises the lease payments as an operating expense on a
straight-line basis over the term of the lease.
Right-of-use assets are tested for impairment if there are any indicators that the carrying amount
may not be recoverable. An impairment loss is recognised in the consolidated income statement
in the period in which it occurs and may be reversed in subsequent periods.
The lease liability is initially measured at the present value of the lease payments that are not paid
at the commencement date, discounted by using the Group’s weighted average incremental
borrowing rate and subsequently held at amortised cost in accordance with IFRS 9. Finance costs
are charged to the income statement over the lease term, at a constant periodic rate of interest.
Right-of-use assets are depreciated over the lease term on a straight-line basis. Each lease
payment is allocated between the liability and finance cost.
The Group as a lessor
When the Group acts as a lessor, it determines whether each lease is a finance lease or an
operating lease.
To classify each lease, the Group makes an overall assessment as to whether the lease transfers
substantially all of the risks and rewards of ownership of the underlying asset to the lessee. If this is
the case, then the lease is a finance lease; if not, then it is an operating lease.
When the Group is an intermediate lessor, it accounts for its interests in the head lease and the
sub-lease separately. Under IFRS 16, the Group is required to assess the classification of a sub-lease
with reference to the right-of-use asset, not the underlying asset.
Amounts due from lessees under finance leases are recorded as receivables at the amount of the
Group’s net investment in the lease. Finance lease income is allocated to accounting periods so as
to reflect a constant periodic rate of return on the Group’s net investment in the lease.
Foreign currency
Transactions denominated in foreign currencies are translated at the rates of exchange prevailing
on the date of the transactions. At each reporting date, items denominated in foreign currencies
are retranslated at the rates prevailing on the reporting date. Exchange differences arising on
settlement and on retranslation are included in the consolidated income statement for the period.
Reach plc Annual Report 2023 153
Notes to the consolidated financial statements continued
3 Accounting policies continued
153
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 154
Notes to the consolidated financial statements continued
3 Accounting policies continued
154
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 154
Notes to the consolidated financial statements continued
3 Accounting policies continued
Trade receivables
Trade receivables do not carry any interest. Conversion to a readily known amount of cash occurs
over a short period and is subject to an insignificant risk of changes in value. Therefore balances
are initially recognised at fair value and subsequently at amortised cost.
The Group recognises a loss allowance for expected credit losses (ECL) on trade receivables and
accrued income. The amount of expected credit losses is updated at each reporting date to reflect
changes in credit risk since initial recognition.
The Group recognises lifetime ECL for trade receivables and accrued income. The expected credit
losses on these financial assets are estimated using a provision matrix based on the Group’s
historical credit loss experience, adjusted for factors that are specific to the debtors, general
economic conditions and an assessment of both the current as well as the forecast direction
of conditions at the reporting date.
Definition of default
The Group considers the following as constituting an event of default for internal credit risk
management purposes as historical experience indicates that financial assets that meet the
following criteria are generally not recoverable:
• Information developed internally or obtained from external sources indicates that the debtor is
unlikely to pay its creditors, including the Group, in full.
Irrespective of the above analysis, the Group considers that default has occurred when a financial
asset is more than 120 days past due unless the Group has reasonable and supportable
information to demonstrate that a more lagging default criterion is more appropriate.
Credit-impaired financial assets
A financial asset is credit-impaired when one or more events that have a detrimental impact on
the estimated future cash flows of that financial asset have occurred. Evidence that a financial
asset is credit-impaired includes observable data about the following events:
(a) Significant financial difficulty of the debtor;
(b) A breach of contract, such as a default or past due event; and
(c) It is becoming probable that the debtor will enter bankruptcy or other financial reorganisation.
Write-off policy
The Group writes off a financial asset when there is information indicating that the debtor is in
severe financial difficulty and there is no realistic prospect of recovery, e.g. when the debtor has
been placed under liquidation or has entered into bankruptcy proceedings. Financial assets written
off may still be subject to enforcement activities under the Group’s recovery procedures, taking into
account legal advice where appropriate. Any recoveries made are recognised in profit or loss.
Measurement and recognition of expected credit losses
The measurement of expected credit losses is a function of the probability of default, loss
given default (i.e. the magnitude of the loss if there is a default) and the exposure at default.
The assessment of the probability of default and loss given default is based on historical data
adjusted by forward-looking information as described above. The expected credit loss is
estimated as the difference between all contractual cash flows that are due to the Group
in accordance with the contract and all the cash flows that the Group expects to receive.
The Group recognises an impairment gain or loss in profit or loss for all financial instruments
with a corresponding adjustment to their carrying amount through a loss allowance account.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand and short-term bank deposits with an original
maturity of one week or less.
Borrowings
Sterling interest bearing loans and bank overdrafts are recorded at the proceeds received, net of
direct issue costs. Foreign currency interest bearing loans are recorded at the exchange rate at the
reporting date. Finance charges, including premiums payable on settlement or redemption and
direct issue costs, are accounted for on an accruals basis in the consolidated income statement
using the effective interest method and are added to the carrying amount of the instrument to
the extent that they are not settled in the period in which they arise. All other borrowing costs are
recognised in the consolidated income statement in the period in which they are incurred.
Trade payables
Trade payables are not interest bearing. Payments occur over a short period and are subject to
an insignificant risk of changes in value. Therefore balances are stated at their nominal value.
Reach plc Annual Report 2023 155
Notes to the consolidated financial statements continued
3 Accounting policies continued
155
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 156
Notes to the consolidated financial statements continued
3 Accounting policies continued
Key sources of estimation uncertainty continued
Impairment review (note 16 continued)
Reach plc Annual Report 2023 157
Notes to the consolidated financial statements continued
3 Accounting policies continued
Critical judgements in applying the Group’s accounting policies continued
Historical Legal Issues (note 27) continued
Subsequently, the test claimants’ application for permission to appeal was refused by the trial judge on 9
February 2024, with claimants having a further short period to apply for permission to appeal to the Court of
Appeal. The prospects of permission being granted and a successful appeal ensuing are deemed remote
and as such no contingent liability has been disclosed in the accounts.
4 Segments
The performance of the Group is presented as a single reporting segment as this is the basis of
internal reports regularly reviewed by the Board and chief operating decision-maker (executive
directors) to allocate resources and to assess performance. The Group’s operations are primarily
located in the UK and the Group is not subject to significant seasonality during the year.
5 Revenue
2023
£m
2022
£m
Print
438.8
448.6
Circulation
312.5
307.7
Advertising
76.6
86.9
Printing
20.2
23.1
Other
29.5
30.9
Digital
127.4
149.8
Other
2.4
3.0
Total revenue
568.6
601.4
The Group’s operations are located primarily in the UK. The Group’s revenue by location of
customers is set out below:
2023
£m
2022
£m
UK
542.4
574.1
Europe
25.5
27.1
Rest of World
0.7
0.2
Total revenue
568.6
601.4
The Group has two customers (representing over 80% of the circulation revenue) where revenues
represent more than 10% of total revenue.
6 Operating profit
2023
£m
2022
£m
Operating profit for the period is arrived at after (charging)/crediting:
Staff costs (note 7)
(223.0)
(234.7)
Cost of inventories recognised as cost of sales
(67.9)
(84.2)
Amortisation of other intangible assets (note 16)
(4.9)
(2.1)
Depreciation of property, plant and equipment (note 17)
(13.9)
(15.2)
Depreciation of right-of-use assets (note 18)
(2.8)
(2.9)
Trade receivables impairment (note 23)
(0.2)
(0.5)
Net foreign exchange (loss)/gain
(0.7)
0.7
Operating adjusted items (note 8)
– excluding associates
(48.9)
(33.4)
– share of associates
(1.5)
(1.4)
Auditors’ remuneration:
Fees payable to the Company’s auditor
s for the audit of the Company’s
annual financial statements
(0.8)
(0.8)
Fees payable to the Company’s auditor
s for the other services to the
Group:
– the audit of the Company’s subsidiaries
(0.5)
(0.5)
Total audit fees
(1.3)
(1.3)
Non-audit fees payable to the Company’s auditors for:
– audit-related assurance services
(0.1)
(0.1)
Total non-audit fees
(0.1)
(0.1)
Total fees
(1.4)
(1.4)
There are also £1k of fees for other non-audit services during the year (2022: £1k).
A description of the work of the Audit & Risk Committee is set out in the Audit & Risk Committee
Report on pages 96 to 103 and includes an explanation of how the objectivity and independence
of the auditors are safeguarded when non-audit services are provided by the auditors.
156
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 156
Notes to the consolidated financial statements continued
3 Accounting policies continued
Key sources of estimation uncertainty continued
Historical Legal Issues (note 27)
The historical legal issues provision relates to the cost associated with dealing with and resolving
civil claims in relation to historical phone hacking and unlawful information gathering. Previously
there have been three parts to the provision: known claims, potential future claims and common
court costs. The key uncertainties in relation to this matter relate to how each claim progresses,
the amount of any settlement and the associated legal costs. Our assumptions have been
based on historical trends, our experience and the expected evolution of claims and costs.
In December 2023, a judgment was handed down in respect of test claims and as a result all claims issued
after 31 October 2020 are now likely to be dismissed other than where individuals can demonstrate specific
exceptional circumstances. This has significantly reduced the amounts that are expected to be paid out
and has resulted in a change to the provision estimate and a net decrease of £20.2m (2022: £11.0m
increase) in the year. At the period end, a provision of £18.2m remains outstanding and this represents the
current best estimate of the amount required to resolve this historical matter. The majority of the provision
is expected to be utilised within the next two years.
Our view on the range of outcomes at the reporting date for the provision, applying more and less
favourable outcomes to all aspects of the provision is £12m to £22m (2022: £32m to £56m). Despite
making a best estimate, the timing of utilisation and ongoing legal matters related to provided for
claims could mean that the final outcome is outside of the range of outcomes.
Taxation (note 11)
There is uncertainty as to the tax deductibility of expenditure relating to historical legal issues in
the current year and additional tax liabilities that may fall due in relation to earlier years. At the
reporting date, the maximum amount of the additional unprovided tax exposure relating to this
uncertain tax item is £4.4m (2022: £8.1m). There is uncertainty as to the final outcome and timing
of this item, with a possible range of outcomes for the potential tax exposure being nil to £27.8m
(2022: nil to £27.2m).
Retirement benefits (note 21)
Actuarial assumptions adopted and external factors can significantly impact the surplus or deficit
of defined benefit pension schemes. Valuations for funding and accounting purposes are based
on assumptions about future economic and demographic variables. These result in risk of a volatile
valuation deficit and the risk that the ultimate cost of paying benefits is higher than the current
assessed liability value. Advice is sourced from independent and qualified actuaries in selecting
suitable assumptions at each reporting date.
Impairment review (note 16)
There is uncertainty in the value-in-use calculation. The most significant area of uncertainty relates to
expected future cash flows for the cash-generating unit. Determining whether the carrying values of assets
in a cash-generating unit are impaired requires an estimation of the value-in-use of the cash-generating
unit to which these have been allocated.
Impairment review (note 16 continued)
The value-in-use calculation requires the Group to estimate the future cash flows expected to arise from
the cash-generating unit and a suitable discount rate in order to calculate present value. Projections are
based on both internal and external market information and reflect past experience. The discount rate
reflects the weighted average cost of capital of the Group.
Restructuring and property provisions (note 27)
Provisions are measured at the best estimate of the expenditure required to settle the obligation
based on the assessment of the related facts and circumstances at each reporting date. There is
uncertainty in relation to the size and length of property-related provisions.
Critical judgements in applying the Group’s accounting policies
In the process of applying the Group’s accounting policies, described above, management has
made the following judgements that have the most significant effect on the amounts recognised
in the financial statements:
Indefinite life assumption in respect of publishing rights and titles (note 16)
There is judgement required in continuing to adopt an indefinite life assumption in respect of
publishing rights and titles. The directors consider publishing rights and titles (with a carrying
amount of £818.7m) have indefinite economic lives due to the longevity of the brands and the
ability to evolve them in an ever-changing media landscape. The brands are central to the
delivery of the Customer Value Strategy which is delivering digital revenue growth. At each
reporting date management review the suitability of this assumption.
Identification of cash-generating units (note 16)
There is judgement required in determining the cash-generating unit relating to our Publishing
brands. At each reporting date management review the interdependency of revenues across
our portfolio of Publishing brands to determine the appropriate cash-generating unit. The Group
operates its Publishing brands such that a majority of the revenues are interdependent and
revenue would be materially lower if brands operated in isolation. As such, management do not
consider that an impairment review at an individual brand level is appropriate or practical. As the
Group continues to centralise revenue generating functions and has moved to a matrix operating
structure over the past few years, all of the individual brands in Publishing have increased revenue
interdependency and are assessed for impairment as a single Publishing cash-generating unit.
Historical Legal Issues (note 27)
Following the judgment handed down on 15 December 2023, all claims issued after 31 October 2020
are now likely to be considered time barred and subsequently dismissed, other than where
individuals can demonstrate there were exceptional circumstances why they could not have been
aware of their putative claims. This has significantly reduced the amounts that are expected to be
paid out and has resulted in a change to the provision estimate and a net decrease of £20.2m.
Reach plc Annual Report 2023 157
Notes to the consolidated financial statements continued
3 Accounting policies continued
Critical judgements in applying the Group’s accounting policies continued
Historical Legal Issues (note 27) continued
4 Segments
The performance of the Group is presented as a single reporting segment as this is the basis of
internal reports regularly reviewed by the Board and chief operating decision-maker (executive
directors) to allocate resources and to assess performance. The Group’s operations are primarily
located in the UK and the Group is not subject to significant seasonality during the year.
5 Revenue
2023 | 2022 | |
£m | £m | |
Print | 438.8 | 448.6 |
Circulation | 312.5 | 307.7 |
Advertising | 76.6 | 86.9 |
Printing | 20.2 | 23.1 |
Other | 29.5 | 30.9 |
Digital | 127.4 | 149.8 |
Other | 2.4 | 3.0 |
Total revenue | 568.6 | 601.4 |
The Group’s operations are located primarily in the UK. The Group’s revenue by location of
customers is set out below:
2023 | 2022 | |
£m | £m | |
UK | 542.4 | 574.1 |
Europe | 25.5 | 27.1 |
Rest of World | 0.7 | 0.2 |
Total revenue | 568.6 | 601.4 |
The Group has two customers (representing over 80% of the circulation revenue) where revenues
represent more than 10% of total revenue.
2023 | 2022 | |
£m | £m | |
Operating profit for the period is arrived at after (charging)/crediting: | ||
Staff costs (note 7) | (223.0) | (234.7) |
Cost of inventories recognised as cost of sales | (67.9) | (84.2) |
Amortisation of other intangible assets (note 16) | (4.9) | (2.1) |
Depreciation of property, plant and equipment (note 17) | (13.9) | (15.2) |
Depreciation of right-of-use assets (note 18) | (2.8) | (2.9) |
Trade receivables impairment (note 23) | (0.2) | (0.5) |
Net foreign exchange (loss)/gain | (0.7) | 0.7 |
Operating adjusted items (note 8) | ||
– excluding associates | (48.9) | (33.4) |
– share of associates | (1.5) | (1.4) |
Auditors’ remuneration: | ||
Fees payable to the Company’s auditor s for the audit of the Company’s | ||
annual financial statements | (0.8) | (0.8) |
Fees payable to the Company’s auditor s for the other services to the Group: | ||
– the audit of the Company’s subsidiaries | (0.5) | (0.5) |
Total audit fees | (1.3) | (1.3) |
Non-audit fees payable to the Company’s auditors for: | ||
– audit-related assurance services | (0.1) | (0.1) |
Total non-audit fees | (0.1) | (0.1) |
Total fees | (1.4) | (1.4) |
157
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 158
Notes to the consolidated financial statements continued
7 Staff costs
The average monthly number of persons, including executive directors, employed by the Group in
the period was:
2023 | 2022 | |
Number | Number | |
Production and editorial | 2,994 | 3,369 |
Sales and distribution | 761 | 916 |
Administration | 348 | 373 |
Total | 4,103 | 4,658 |
The majority of employees are primarily employed in the UK. The above excludes casual
employees working for the Group during the period due to the impracticality of determining an
average.
Staff costs, including directors’ emoluments, incurred during the period were:
2023 | 2022 | |
£m | £m | |
Wages and salaries | (183.1) | (192.5) |
Social security costs | (21.3) | (22.6) |
Share-based payments charge in the period (note 32) | (1.3) | (1.5) |
Pension costs relating to defined contribution pension schemes (note 21) | (17.3) | (18.1) |
Total | (223.0) | (234.7) |
Wages and salaries include bonuses payable in the period. Restructuring costs and the National
Insurance costs relating to share awards which are included in operating adjusted items (note 8)
are excluded from staff costs.
Disclosure of individual directors’ remuneration, share awards, long-term incentive schemes,
pension contributions and pension entitlements required by the Companies Act 2006 and those
elements specified for audit by the Financial Conduct Authority are shown in the tables in the
Remuneration Report on pages 104 to 126 and form part of these consolidated financial statements.
8 Operating adjusted items
2023 | 2022 | |
£m | £m | |
Provision for historical legal issues (note 27) | 20.2 | (11.0) |
Restructuring charges in respect of cost reduction measures (note 27) | (26.9) | (15.5) |
(Impairment of sublease)/sublet of closed print site (notes 18, 19 and 27) | (19.4) | 16.6 |
Other property-related costs (note 35) | (8.0) | (4.6) |
Pension administrative expenses and past service costs | ||
(note 21) | (5.5) | (14.8) |
Other items (note 35) | (9.3) | (4.1) |
Operating adjusted items included in administrative expenses | (48.9) | (33.4) |
Operating adjusted items included in share of results of associates (note 20) | (1.5) | (1.4) |
Total operating adjusted items | (50.4) | (34.8) |
Operating adjusted items relate to costs or income that derive from events or transactions that
fall within the normal activities of the Group, but are excluded from the Group’s adjusted profit
measures, individually or, if of a similar type in aggregate, due to their size and/or nature in order to
better reflect management’s view of the performance of the Group. The adjusted profit measures
are not recognised profit measures under IFRS and may not be directly comparable with adjusted
profit measures used by other companies. Set out in note 35 is the reconciliation between the
statutory and adjusted results which includes descriptions of the items included in adjusted items.
The Group has recorded a £20.2m decrease (2022: £11.0m increase) in the provision for historical
legal issues relating to the cost associated with dealing with and resolving civil claims in relation
to historical phone hacking and unlawful information gathering (note 27). This material reduction is
driven by the judgment handed down during December 2023 in respect of test claims. As a result
of the ruling, all claims issued after 31 October 2020 are now likely to be dismissed other than where
individuals can demonstrate specific exceptional circumstances, and therefore this has
significantly reduced the amounts that are expected to be paid out.
Restructuring charges of £26.9m (2022: £15.5m) principally relate to cost management actions
taken in the period.
158
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 158
Notes to the consolidated financial statements continued
7 Staff costs
The average monthly number of persons, including executive directors, employed by the Group in
the period was:
2023
Number
2022
Number
Production and editorial
2,994
3,369
Sales and distribution
761
916
Administration
348
373
Total
4,103
4,658
The majority of employees are primarily employed in the UK. The above excludes casual
employees working for the Group during the period due to the impracticality of determining an
average.
Staff costs, including directors’ emoluments, incurred during the period were:
2023
£m
2022
£m
Wages and salaries
(183.1)
(192.5)
Social security costs
(21.3)
(22.6)
Share-based payments charge in the period (note 32)
(1.3)
(1.5)
Pension costs relating to defined contribution pension schemes (note 21)
(17.3)
(18.1)
Total
(223.0)
(234.7)
Wages and salaries include bonuses payable in the period. Restructuring costs and the National
Insurance costs relating to share awards which are included in operating adjusted items (note 8)
are excluded from staff costs.
Disclosure of individual directors’ remuneration, share awards, long-term incentive schemes,
pension contributions and pension entitlements required by the Companies Act 2006 and those
elements specified for audit by the Financial Conduct Authority are shown in the tables in the
Remuneration Report on pages 104 to 126 and form part of these consolidated financial statements.
8 Operating adjusted items
2023
£m
2022
£m
Provision for historical legal issues (note 27)
20.2
(11.0)
Restructuring charges in respect of cost reduction measures (note 27)
(26.9)
(15.5)
(Impairment of sublease)/sublet of closed print site (notes 18, 19 and 27)
(19.4)
16.6
Other property-related costs (note 35)
(8.0)
(4.6)
Pension administrative expenses and past service costs
(note 21)
(5.5)
(14.8)
Other items (note 35)
(9.3)
(4.1)
Operating adjusted items included in administrative expenses
(48.9)
(33.4)
Operating adjusted items included in share of results of associates (note 20)
(1.5)
(1.4)
Total operating adjusted items
(50.4)
(34.8)
Operating adjusted items relate to costs or income that derive from events or transactions that
fall within the normal activities of the Group, but are excluded from the Group’s adjusted profit
measures, individually or, if of a similar type in aggregate, due to their size and/or nature in order to
better reflect management’s view of the performance of the Group. The adjusted profit measures
are not recognised profit measures under IFRS and may not be directly comparable with adjusted
profit measures used by other companies. Set out in note 35 is the reconciliation between the
statutory and adjusted results which includes descriptions of the items included in adjusted items.
The Group has recorded a £20.2m decrease (2022: £11.0m increase) in the provision for historical
legal issues relating to the cost associated with dealing with and resolving civil claims in relation
to historical phone hacking and unlawful information gathering (note 27). This material reduction is
driven by the judgment handed down during December 2023 in respect of test claims. As a result
of the ruling, all claims issued after 31 October 2020 are now likely to be dismissed other than where
individuals can demonstrate specific exceptional circumstances, and therefore this has
significantly reduced the amounts that are expected to be paid out.
Restructuring charges of £26.9m (2022: £15.5m) principally relate to cost management actions
taken in the period.
Reach plc Annual Report 2023 159
Notes to the consolidated financial statements continued
8 Operating adjusted items continued
Following the sublet of the vacant print site during 2022 which resulted in the reversal of an
impairment in right-of-use assets of £11.0m and previously onerous costs of the vacant site of
£5.6m, the sub-lessee entered into administration during 2023. As a result, the corresponding
£10.8m finance lease receivable has been impaired along with the subsequent recognition of
onerous costs of £8.6m of the vacant site during the period.
Other property-related costs comprise the impairment of vacant freehold property costs (£4.3m),
vacant freehold property-related costs (£1.4m) and onerous lease and related costs (£2.6m) less
the profit on sale of assets (£0.3m). In 2022, other property-related costs related to the impairment
of vacant freehold property (£4.2m) and plant and equipment (£0.8m) less the profit on sale of
impaired assets (£0.4m).
Pension costs of £5.5m (2022: £14.8m) comprise pension administrative expenses (2022: £4.2m).
2022 also included £10.6m of past service costs relating to a Barber Window equalisation
adjustment.
Other adjusted items comprise the Group’s legal fees in respect of historical legal issues (£5.3m),
adviser costs in relation to the triennial funding valuations (£2.5m), internal pension administrative
expenses (£0.6m), corporate simplification costs (£0.5m), and other restructuring-related project
costs (£0.7m) less a reduction in National Insurance costs relating to share awards (£0.3m). In 2022,
other adjusted items comprise the Group’s legal fees in respect of historical legal issues (£5.2m),
adviser costs in relation to the triennial funding valuations (£1.6m), less a reduction in National
Insurance costs relating to share awards (£2.7m).
2023 | 2022 | |
£m | £m | |
Interest income on bank deposits | 0.6 | 0.1 |
Interest on finance lease receivable | 0.4 | – |
Interest income | 1.0 | 0.1 |
2023 | 2022 | |
£m | £m | |
Interest and charges on borrowings | (3.3) | (1.8) |
Interest on lease liabilities | (1.2) | (1.1) |
Finance costs | (4.5) | (2.9) |
2023 | 2022 | |
£m | £m | |
Corporation tax charge for the period | (5.5) | (4.5) |
Prior period adjustment | (1.1) | (0.7) |
Current tax charge | (6.6) | (5.2) |
Deferred tax charge for the period | (8.1) | (9.0) |
Prior period adjustment | (1.0) | 0.3 |
Deferred tax rate change | 0.5 | – |
Deferred tax charge | (8.6) | (8.7) |
Tax charge | (15.2) | (13.9) |
159
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 160
Notes to the consolidated financial statements continued
11 Tax charge continued
2023 | 2022 | |
Reconciliation of tax charge | £m | £m |
Profit before tax | 36.7 | 66.2 |
Standard rate of corporation tax of 23.5% (2022: 19.0%) | (8.6) | (12.6) |
Variance in overseas tax rates | 0.9 | – |
Impact of change in tax rates | 0.5 | – |
Tax effect of permanent items that are not included in determining | ||
taxable profit | (5.8) | (1.2) |
Deferred tax not recognised | (0.4) | – |
Prior period adjustment | (2.1) | (0.4) |
Tax effect of share of results of associates | 0.3 | 0.3 |
Tax charge | (15.2) | (13.9) |
2023 | 2022 | |
| Pence | Pence | |
per share | per share | |
Amounts recognised as distributions to equity holders in the period | ||
Dividends paid per share – prior year final dividend | 4.46 | 4.46 |
Dividends paid per share – interim dividend | 2.88 | 2.88 |
Total dividends paid per share | ||
Dividend proposed per share but not paid nor included in the accounting records |
13 Earnings per share
Basic earnings per share is calculated by dividing profit for the period attributable to equity holders
of the parent by the weighted average number of ordinary shares during the period, and diluted
earnings per share is calculated by adjusting the weighted average number of ordinary shares
in issue on the assumption of conversion of all potentially dilutive ordinary shares.
2023 | 2022 | |
Thousand | Thousand | |
Weighted average number of ordinary shares for basic earnings | ||
per share | 314,206 | 312,153 |
Effect of potential dilutive ordinary shares in respect of share awards | 2,893 | 4,828 |
Weighted average number of ordinary shares for diluted earnings | ||
per share | 317,099 | 316,981 |
160
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 160
Notes to the consolidated financial statements continued
11 Tax charge continued
Reconciliation of tax charge
2023
£m
2022
£m
Profit before tax
36.7
66.2
Standard rate of corporation tax of 23.5% (2022: 19.0%)
(8.6)
(12.6)
Variance in overseas tax rates
0.9
–
Impact of change in tax rates
0.5
–
Tax effect of
permanent items that are not included in determining
taxable profit
(5.8)
(1.2)
Deferred tax not recognised
(0.4)
–
Prior period adjustment
(2.1)
(0.4)
Tax effect of share of results of associates
0.3
0.3
Tax charge
(15.2)
(13.9)
The standard rate of corporation tax for the period is 23.5% (2022: 19.0%). The tax effect of items that
are not deductible in determining taxable profit includes certain costs where there is uncertainty
as to their deductibility. The current tax receivable of £8.1m (2022: £13.9m) is net of the uncertain tax
provision of £23.4m (2022: £19.1m). At the reporting date, the maximum amount of the additional
unprovided tax exposure relating to an uncertain tax item is £4.4m (2022: £8.1m). There is uncertainty
as to the final outcome and timing of this item, with a possible range of outcomes for the potential
tax exposure being nil to £27.8m (2022: nil to £27.2m).
The tax on actuarial losses (2022: losses) on defined benefit pension schemes taken to the
consolidated statement of comprehensive income is a deferred tax credit of £0.1m (2022: credit
of £7.4m).
The amount taken to the consolidated income statement as a result of pension contributions
was £11.4m (2022: £7.1m).
12 Dividends
2023
Pence
per share
2022
Pence
per share
Amounts recognised as distributions to equity holders in the period
Dividends paid per share – prior year final dividend
4.46
4.46
Dividends paid per share – interim dividend
2.88
2.88
Total dividends paid per share
7.34
7.34
Dividend proposed per share but not paid nor included in the
accounting records
4.46
4.46
The Board proposes a final dividend for 2023 of 4.46 pence per share. An interim dividend for 2023
of 2.88 pence per share was paid on 22 September 2023 bringing the total dividend in respect of
2023 to 7.34 pence per share. The 2023 final dividend payment is expected to amount to £14.0m.
On 3 May 2023, the final dividend proposed for 2022 of 4.46 pence per share was approved by
shareholders at the Annual General Meeting and was paid on 2 June 2023.
Total dividends paid in 2023 were £23.1m (2022 final dividend payment of £14.0m and 2023 interim
dividend payment of £9.1m).
13 Earnings per share
Basic earnings per share is calculated by dividing profit for the period attributable to equity holders
of the parent by the weighted average number of ordinary shares during the period, and diluted
earnings per share is calculated by adjusting the weighted average number of ordinary shares
in issue on the assumption of conversion of all potentially dilutive ordinary shares.
2023
Thousand
2022
Thousand
Weighted average number of ordinary shares for basic earnings
per share
314,206
312,153
Effect of potential dilutive ordinary shares in respect of share awards
2,893
4,828
Weighted average number of ordinary shares for diluted earnings
per share
317,099
316,981
Reach plc Annual Report 2023 161
Notes to the consolidated financial statements continued
13 Earnings per share continued
The weighted average number of potentially dilutive ordinary shares not currently dilutive was
6,328,039 (2022: 5,406,814).
2023 | 2022 | |
Statutory earnings per share | Pence | Pence |
Earnings per share – basic | 6.8 | 16.8 |
Earnings per share – diluted | 6.8 | 16.5 |
2023 | 2022 | |
Adjusted earnings per share | Pence | Pence |
Earnings per share – basic | 21.8 | 27.1 |
Earnings per share – diluted | 21.6 | 26.7 |
Set out in note 35 is the reconciliation between the statutory and adjusted results.
14 Cash flows from operating activities
2023 | 2022 | |
£m | £m | |
Operating profit | 46.1 | 71.3 |
Depreciation of property, plant and equipment | 13.9 | 15.2 |
Depreciation of right-of-use assets | 2.8 | 2.9 |
Amortisation of other intangible assets | 4.9 | 2.1 |
Impairment of property, plant and equipment | 4.7 | 5.0 |
Reversal of impairment of right-of-use assets | – | (11.0) |
Impairment of finance lease receivable | 10.8 | – |
Impairment of right-of-use assets | 1.3 | – |
Profit on disposal of property, plant and equipment | (0.3) | (0.4) |
Share of results of associates | (1.4) | (1.4) |
Share-based payments charge | 1.3 | 1.5 |
Pension administrative expenses and past service costs | 5.5 | 14.8 |
Operating cash flows before movements in working capital | 89.6 | 100.0 |
Decrease/(increase) in inventories | 1.5 | (7.4) |
Decrease in receivables | 9.5 | 7.2 |
Decrease in payables | (24.2) | (19.7) |
Cash flows from operating activities | 76.4 | 80.1 |
Total | |
£m | |
Cost | |
At 27 December 2021 | 189.9 |
At 25 December 2022 | 189.9 |
At 31 December 2023 | 189.9 |
Accumulated impairment | |
At 27 December 2021 | (154.0) |
At 25 December 2022 | (154.0) |
At 31 December 2023 | (154.0) |
Carrying amount | |
At 25 December 2022 | 35.9 |
At 31 December 2023 | 35.9 |
161
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Notes to the consolidated financial statements continued
Publishing | Internally | ||
| rights and | generated | ||
| titles | assets | Total | |
£m | £m | £m | |
Cost | |||
At 27 December 2021 | 2,100.3 | 6.0 | 2,106.3 |
Additions | – | 10.7 | 10.7 |
At 25 December 2022 | 2,100.3 | 16.7 | 2,117.0 |
Additions | – | 12.8 | 12.8 |
At 31 December 2023 | 2,100.3 | 29.5 | 2,129.8 |
Accumulated amortisation | |||
At 27 December 2021 | (1,281.6) | (0.4) | (1,282.0) |
Charge for the period | – | (2.1) | (2.1) |
At 25 December 2022 | (1,281.6) | (2.5) | (1,284.1) |
Charge for the period | – | (4.9) | (4.9) |
At 31 December 2023 | (1,281.6) | (7.4) | (1,289.0) |
Carrying amount | |||
At 25 December 2022 | 818.7 | 14.2 | 832.9 |
At 31 December 2023 | 818.7 | 22.1 | 840.8 |
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Notes to the consolidated financial statements continued
16 Other intangible assets
Publishing
rights and
titles
£m
Internally
generated
assets
£m
Total
£m
Cost
At 27 December 2021
2,100.3
6.0
2,106.3
Additions
–
10.7
10.7
At 25 December 2022
2,100.3
16.7
2,117.0
Additions
–
12.8
12.8
At 31 December 2023
2,100.3
29.5
2,129.8
Accumulated amortisation
At 27 December 2021
(1,281.6)
(0.4)
(1,282.0)
Charge for the period
–
(2.1)
(2.1)
At 25 December 2022
(1,281.6)
(2.5)
(1,284.1)
Charge for the period
–
(4.9)
(4.9)
At 31 December 2023
(1,281.6)
(7.4)
(1,289.0)
Carrying amount
At 25 December 2022
818.7
14.2
832.9
At 31 December 2023
818.7
22.1
840.8
During the year, the Group capitalised internally generated assets relating to software and website
development costs of £12.8m (2022: £10.7m). These assets are amortised using the straight-line
method over their estimated useful lives (3-5 years).
Publishing rights and titles are not amortised. There is judgement required in continuing to adopt
an indefinite life assumption in respect of publishing rights and titles. The directors consider
publishing rights and titles (with a carrying amount of £818.7m) have indefinite economic lives
due to the longevity of the brands and the ability to evolve them in an ever-changing media
landscape. The brands are central to the delivery of the Customer Value Strategy which is
delivering digital revenue growth. This, combined with our inbuilt and relentless focus on
maximising efficiency, gives confidence that the delivery of sustainable growth in revenue,
profit and cash flow is achievable in the future.
There is judgement required in determining the cash-generating units. At each reporting date
management review the interdependency of revenues across our Publishing brands to determine
the appropriate cash-generating unit. The Group operates its Publishing brands such that a
majority of the revenues are interdependent and revenue would be materially lower if brands
operated in isolation. As such, management do not consider that an impairment review at an
individual brand level is appropriate or practical. As the Group continues to centralise revenue
generating functions and has moved to a matrix operating structure over the past few years, all
of the individual brands in Publishing have increased revenue interdependency and are assessed
for impairment as a single Publishing cash-generating unit.
The Group tests the carrying value of assets at the cash-generating unit level for impairment
annually or more frequently if there are indicators that assets might be impaired. The review
is undertaken by assessing whether the carrying value of assets is supported by their
value-in-use which is calculated as the net present value of future cash flows derived from
those assets, using cash flow projections. If an impairment charge is required this is allocated
first to reduce the carrying amount of any goodwill allocated to the cash-generating unit and
then to the other assets of the cash-generating unit but subject to not reducing any asset
below its recoverable amount.
Reach plc Annual Report 2023 163
Notes to the consolidated financial statements continued
16 Other intangible assets continued
17 Property, plant and equipment
Freehold land | Plant and | Asset under | ||
| and buildings | equipment | construction | Total | |
£m | £m | £m | £m | |
Cost | ||||
At 27 December 2021 | 204.6 | 360.5 | 2.2 | 567.3 |
Additions | – | 1.7 | 1.3 | 3.0 |
Disposals | – | (24.0) | – | (24.0) |
Reclassification | – | 3.0 | (3.0) | – |
At 25 December 2022 | 204.6 | 341.2 | 0.5 | 546.3 |
Additions | – | 1.6 | 2.1 | 3.7 |
Disposals | (2.3) | (0.7) | – | (3.0) |
Reclassification | – | 1.1 | (1.1) | – |
Transfer to assets classified as held for sale | (46.7) | – | – | (46.7) |
At 31 December 2023 | 155.6 | 343.2 | 1.5 | 500.3 |
Accumulated depreciation and impairment | ||||
At 27 December 2021 | (99.3) | (310.7) | – | (410.0) |
Charge for the period | (2.6) | (12.6) | – | (15.2) |
Eliminated on disposal | – | 24.0 | – | 24.0 |
Impairment | (4.2) | (0.8) | – | (5.0) |
At 25 December 2022 | (106.1) | (300.1) | – | (406.2) |
Charge for the period | (2.6) | (11.3) | – | (13.9) |
Eliminated on disposal | 1.7 | 0.7 | – | 2.4 |
Impairment | (4.3) | (0.4) | – | (4.7) |
Transfer to assets classified as held for sale | 35.7 | – | – | 35.7 |
At 31 December 2023 | (75.6) | (311.1) | – | (386.7) |
Carrying amount | ||||
At 25 December 2022 | 98.5 | 41.1 | 0.5 | 140.1 |
At 31 December 2023 | 80.0 | 32.1 | 1.5 | 113.6 |
Impairment of vacant freehold property of £4.3m (2022: £4.2m) (note 8) was as a result of the
carrying value of certain Group properties being in excess of their market value at the reporting
date. Plant and equipment was impaired by £0.4m (2022: £0.8m) in the period due to site closures
and is included within onerous lease and related costs of £2.6m (note 8).
163
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Reach plc Annual Report 2023 164
Notes to the consolidated financial statements continued
17 Property, plant and equipment continued
In 2022, £24.0m of disposals in cost and accumulated depreciation relate to the scrapping of plant
and equipment as a result of the sublet of the vacant print site, which was fully impaired in 2020.
18 Right-of-use assets
Properties | Vehicles | Total | |
£m | £m | £m | |
Cost | |||
At 27 December 2021 | 43.1 | 3.4 | 46.5 |
Additions | 1.1 | – | 1.1 |
Derecognition at start of sublease classified as finance lease | (14.6) | – | (14.6) |
Derecognition at end of lease term | (2.2) | (0.2) | (2.4) |
At 25 December 2022 | 27.4 | 3.2 | 30.6 |
Additions | 4.1 | 2.0 | 6.1 |
Other movements | 0.1 | – | 0.1 |
Derecognition at end of lease term | (3.5) | (1.6) | (5.1) |
At 31 December 2023 | 28.1 | 3.6 | 31.7 |
Accumulated depreciation and impairment | |||
At 27 December 2021 | (31.8) | (2.0) | (33.8) |
Charge for the period | (2.2) | (0.7) | (2.9) |
Reversal of impairment | 11.0 | – | 11.0 |
Derecognition at start of sublease classified as finance lease | 3.6 | – | 3.6 |
Derecognition at end of lease term | 2.2 | 0.2 | 2.4 |
At 25 December 2022 | (17.2) | (2.5) | (19.7) |
Charge for the period | (2.1) | (0.7) | (2.8) |
Impairment | (1.3) | – | (1.3) |
Derecognition at end of lease term | 3.5 | 1.6 | 5.1 |
At 31 December 2023 | (17.1) | (1.6) | (18.7) |
Carrying amount | |||
At 25 December 2022 | 10.2 | 0.7 | 10.9 |
At 31 December 2023 | 11.0 | 2.0 | 13.0 |
Other movements include the impact of changes in lease term.
In 2022, the sublet of the vacant print site which was closed in 2020 resulted in the reversal of an
impairment in right-of-use assets of £11.0m (note 8). The sublet was classified as a finance lease
and the net investment in the lease of £11.0m was recognised as a finance lease receivable in the
consolidated balance sheet at 25 December 2022.
Amounts recognised in the consolidated income statement
The consolidated income statement includes the following amounts relating to leases:
2023 | 2022 | |
£m | £m | |
Depreciation of right-of-use assets | (2.8) | (2.9) |
Impairment of right-of-use assets | (1.3) | – |
Impairment of finance lease receivable | (10.8) | – |
Reversal of impairment of right-of-use assets | – | 11.0 |
Expenses relating to short-term leases | (0.1) | (0.1) |
Interest on lease liabilities (included in finance cost) | (1.2) | (1.1) |
Interest on finance lease receivable (included in interest income) | 0.4 | – |
Total (charged)/credited to the consolidated income statement | (15.8) | 6.9 |
Amounts recognised in the consolidated cash flow statement
The total cash outflow for leases in 2023 was £5.9m (2022: £6.7m). The total cash received in
relation to the finance lease receivable in 2023 was £0.6m (2022: nil).
19 Leases
Finance lease receivable
Properties | Total | |
£m | £m | |
At 27 December 2021 | – | – |
Recognition of receivable at commencement of sublease | 11.0 | 11.0 |
At 25 December 2022 | 11.0 | 11.0 |
Interest income | 0.4 | 0.4 |
Lease receipts | (0.6) | (0.6) |
Impairment | (10.8) | (10.8) |
At 31 December 2023 | – | – |
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Notes to the consolidated financial statements continued
17 Property, plant and equipment continued
In 2022, £24.0m of disposals in cost and accumulated depreciation relate to the scrapping of plant
and equipment as a result of the sublet of the vacant print site, which was fully impaired in 2020.
18 Right-of-use assets
Properties
£m
Vehicles
£m
Total
£m
Cost
At 27 December 2021
43.1
3.4
46.5
Additions
1.1
–
1.1
Derecognition at start of sublease classified as finance lease
(14.6)
–
(14.6)
Derecognition at end of lease term
(2.2)
(0.2)
(2.4)
At 25 December 2022
27.4
3.2
30.6
Additions
4.1
2.0
6.1
Other movements
0.1
–
0.1
Derecognition at end of lease term
(3.5)
(1.6)
(5.1)
At 31 December 2023
28.1
3.6
31.7
Accumulated depreciation and impairment
At 27 December 2021
(31.8)
(2.0)
(33.8)
Charge for the period
(2.2)
(0.7)
(2.9)
Reversal of impairment
11.0
–
11.0
Derecognition at start of sublease classified as finance lease
3.6
–
3.6
Derecognition at end of lease term
2.2
0.2
2.4
At 25 December 2022
(17.2)
(2.5)
(19.7)
Charge for the period
(2.1)
(0.7)
(2.8)
Impairment
(1.3)
–
(1.3)
Derecognition at end of lease term
3.5
1.6
5.1
At 31 December 2023
(17.1)
(1.6)
(18.7)
Carrying amount
At 25 December 2022
10.2
0.7
10.9
At 31 December 2023
11.0
2.0
13.0
Other movements include the impact of changes in lease term.
In 2022, the sublet of the vacant print site which was closed in 2020 resulted in the reversal of an
impairment in right-of-use assets of £11.0m (note 8). The sublet was classified as a finance lease
and the net investment in the lease of £11.0m was recognised as a finance lease receivable in the
consolidated balance sheet at 25 December 2022.
Amounts recognised in the consolidated income statement
The consolidated income statement includes the following amounts relating to leases:
2023
£m
2022
£m
Depreciation of right-of-use assets
(2.8)
(2.9)
Impairment of right-of-use assets
(1.3)
–
Impairment of finance lease receivable
(10.8)
–
Reversal of impairment of right-of-use assets
–
11.0
Expenses relating to short-term leases
(0.1)
(0.1)
Interest on lease liabilities (included in finance cost)
(1.2)
(1.1)
Interest on finance lease receivable (included in interest income)
0.4
–
Total (charged)/credited to the consolidated income statement
(15.8)
6.9
Amounts recognised in the consolidated cash flow statement
The total cash outflow for leases in 2023 was £5.9m (2022: £6.7m). The total cash received in
relation to the finance lease receivable in 2023 was £0.6m (2022: nil).
19 Leases
Finance lease receivable
Properties
£m
Total
£m
At 27 December 2021
–
–
Recognition of receivable at commencement of sublease
11.0
11.0
At 25 December 2022
11.0
11.0
Interest income
0.4
0.4
Lease receipts
(0.6)
(0.6)
Impairment
(10.8)
(10.8)
At 31 December 2023
–
–
Reach plc Annual Report 2023 165
Notes to the consolidated financial statements continued
19 Leases continued
Finance lease receivable continued
Following the sublet of the vacant print site during 2022 under a finance lease which resulted in
the recognition of a finance lease receivable of £11.0m at the commencement of the sublease,
the sub-lessee has subsequently entered into administration during 2023. As a result, the
corresponding £10.8m finance lease receivable has been impaired down to nil.
The finance lease receivable (net investment in the lease) included in the consolidated balance
sheet is nil (2022: £11.0m).
The finance lease receivable has been analysed between current and non-current as follows:
2023 | 2022 | |
£m | £m | |
Current | – | 0.6 |
Non-current | – | 10.4 |
– | 11.0 |
The following table sets out the maturity analysis of finance lease receivables, showing the
undiscounted lease payments to be received after the reporting date.
2023 | 2022 | |
£m | £m | |
Less than one year | – | 1.2 |
One to two years | – | 1.2 |
Two to three years | – | 1.2 |
Three to four years | – | 1.2 |
Four to five years | – | 1.2 |
Greater than five years | – | 9.1 |
Total cash flows | – | 15.1 |
Unearned finance income | – | (4.1) |
Net investment in the lease | – | 11.0 |
Lease liabilities
Lease liabilities represent rental obligations for office properties and motor vehicles.
Properties | Vehicles | Total | |
£m | £m | £m | |
At 27 December 2021 | (34.7) | (1.5) | (36.2) |
Additions | (1.1) | – | (1.1) |
Interest costs | (1.1) | – | (1.1) |
Payments | 6.0 | 0.7 | 6.7 |
At 25 December 2022 | (30.9) | (0.8) | (31.7) |
Additions | (4.1) | (2.0) | (6.1) |
Interest costs | (1.1) | (0.1) | (1.2) |
Payments | 5.2 | 0.7 | 5.9 |
Other movements | (0.1) | – | (0.1) |
At 31 December 2023 | (31.0) | (2.2) | (33.2) |
Other movements include the impact of changes in lease term.
The lease liabilities have been analysed between current and non-current as follows:
2023 | 2022 | |
£m | £m | |
Current | (4.7) | (4.9) |
Non-current | (28.5) | (26.8) |
(33.2) | (31.7) |
The Group does not face significant liquidity risk in relation to its lease liabilities.
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Reach plc Annual Report 2023 166
Notes to the consolidated financial statements continued
PA Media | PA Media | |
| 2023 | 2022 | |
£m | £m | |
Opening balance | 14.6 | 17.4 |
Dividends received | (1.9) | (2.5) |
Share of results: | 1.4 | 1.4 |
Results before adjusted items | 2.9 | 2.8 |
Adjusted items | (1.5) | (1.4) |
Share of other comprehensive loss | 0.4 | (1.7) |
Closing balance | 14.5 | 14.6 |
Country of | Class of | Accounting | ||
Company | incorporation | shares | Shareholding | year end |
PA Media Group Limited | UK | ordinary | 25.41% | 31 December |
2023 | 2022 | |
£m | £m | |
PA Media Group Limited | ||
Non-current assets | 52.7 | 49.7 |
Current assets | 48.0 | 49.1 |
Total assets | 100.7 | 98.8 |
Current liabilities | (43.8) | (41.5) |
Total liabilities | (43.8) | (41.5) |
Net assets | 56.9 | 57.3 |
Group’s share of net assets | 14.5 | 14.6 |
Revenue | 111.4 | 105.4 |
Profit for the period | 5.7 | 5.4 |
Group’s share of profit for the period | 1.4 | 1.4 |
166
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Reach plc Annual Report 2023 166
Notes to the consolidated financial statements continued
20 Investment in associates
Details of the Group’s associates at 31 December 2023 are set out on page 204.
The carrying value of investments in associates is set out below:
PA Media
2023
£m
PA Media
2022
£m
Opening balance
14.6
17.4
Dividends received
(1.9)
(2.5)
Share of results:
1.4
1.4
Results before adjusted items
2.9
2.8
Adjusted items
(1.5)
(1.4)
Share of other comprehensive loss
0.4
(1.7)
Closing balance
14.5
14.6
The share of total comprehensive income from associates recognised in 2023 is £1.8m
(2022: loss of £0.3m).
Information on principal associate:
Company
Country of
incorporation
Class of
shares
Shareholding
Accounting
year end
PA Media Group Limited
UK
ordinary
25.41%
31 December
The table below provides summarised financial information for PA Media Group Limited which is
material to the Group. The information disclosed reflects the amounts presented in the financial
statements and management accounts of the associate as amended to reflect adjustments
made when using the equity method, including fair value adjustments and modifications for
differences in accounting policy.
The financial statements of PA Media Group Limited are made up to 31 December each year.
For the purposes of applying the equity method of accounting, the audited financial statements
of PA Media Group Limited for the year ended 31 December 2022 together with the management
accounts up to the end of December 2023 have been used with appropriate year-end
adjustments made. Included in the share of operating adjusted items of associates is after
tax restructuring charges of £0.2m (2022: £0.1m) and after tax amortisation charges of £1.3m
(2022: £1.3m). The share of other comprehensive income of £0.4m (2022: loss of £1.7m) relates
primarily to pensions.
2023
£m
2022
£m
PA Media Group Limited
Non-current assets
52.7
49.7
Current assets
48.0
49.1
Total assets
100.7
98.8
Current liabilities
(43.8)
(41.5)
Total liabilities
(43.8)
(41.5)
Net assets
56.9
57.3
Group’s share of net assets
14.5
14.6
Revenue
111.4
105.4
Profit for the period
5.7
5.4
Group’s share of profit for the period
1.4
1.4
Reach plc Annual Report 2023 167
Notes to the consolidated financial statements continued
21 Retirement benefit schemes
167
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Reach plc Annual Report 2023 168
Notes to the consolidated financial statements continued
21 Retirement benefit schemes continued
168
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Reach plc Annual Report 2023 168
Notes to the consolidated financial statements continued
21 Retirement benefit schemes continued
At the reporting date, the funding deficits in all schemes are expected to be removed before or
around 2029 by a combination of the contributions and asset returns. Contributions (which include
funding for pension administrative expenses) are payable monthly. Contributions per the current
schedule of contributions are £60.9m pa (including £0.7m for the EN88 scheme to a separate bank
account) in 2024, £60.9m in 2025, £61.8m in 2026, £59.8m in 2027, £12.5m in 2028 and £8.6m in 2029.
The future deficit funding commitments are linked to the three-yearly actuarial valuations.
Although the funding commitments do not generally impact the IAS 19 position, IFRIC 14 guides
companies to consider for IAS 19 disclosures whether any surplus can be recognised as a balance
sheet asset and whether any future funding commitments in excess of the IAS 19 liability should
be provisioned for. Based on its interpretation of the rules for each of the defined benefit pension
schemes, the Group considers that it has an unconditional right to any potential surplus on the
ultimate wind-up after all benefits to members have been paid in respect of all of the schemes
except the WF Scheme. Under IFRIC 14 it is therefore appropriate to recognise any IAS 19 surpluses
which may emerge in future and not to recognise any potential additional liabilities in respect of
future funding commitments of all of the schemes except for the WF Scheme. For the WF Scheme
at the reporting date, the assets are surplus to the IAS 19 benefit liabilities and the impact of IFRIC 14
removes this surplus. As no further contributions are expected to the WF Scheme, the Group no
longer recognises a deficit of its future deficit contribution commitment to the scheme.
The calculation of Guaranteed Minimum Pension (‘GMP’) is set out in legislation and members of
pension schemes that were contracted out of the State Earnings-Related Pension Scheme (‘SERPS’)
between 6 April 1978 and 5 April 1997 will have built up an entitlement to a GMP. GMPs were intended
to broadly replicate the SERPS pension benefits but due to their design they give rise to inequalities
between men and women, in particular, the GMP for a male comes into payment at age 65
whereas for a female it comes into payment at the age of 60 and GMPs typically receive different
levels of increase to non GMP benefits. On 26 October 2018, the High Court handed down its
judgement in the Lloyds Trustees vs Lloyds Bank plc and Others case relating to the equalisation of
member benefits for the gender effects of GMP equalisation. This judgement creates a precedent
for other UK defined benefit schemes with GMPs. The judgement confirmed that GMP equalisation
was required for the period 17 May 1990 to 5 April 1997 and provided some clarification on legally
acceptable methods for achieving equalisation. An allowance for GMP equalisation was first
included within liabilities at 30 December 2018 and was recognised as a charge for past service
costs in the income statement. In 2020 further clarification was issued relating to GMP equalisation
in respect of transfers out of schemes and a further allowance for GMP equalisation was included
within liabilities at 27 December 2020 and was recognised as a charge for past service costs in the
income statement. The estimate is subject to change as we undertake more detailed member
calculations, as guidance is issued and/or as a result of future legal judgements.
Past service costs of £10.6m in 2022 related to a Barber Window equalisation adjustment identified
by the Trustees of the MGN Scheme during the prior year. The impact relates to the equalisation of
retirement ages to 65, which was previously implemented from 17 May 1990, rather than the date
of the Deed of Amendment of the Rules which was 4 April 1991.
Risks
Valuations for funding and accounting purposes are based on assumptions about future
economic and demographic variables. This results in the risk of a volatile valuation deficit and
the risk that the ultimate cost of paying benefits is higher than the current assessed liability value.
The main sources of risk are:
• investment risk: a reduction in asset returns (or assumed future asset returns);
• inflation risk: an increase in benefit increases (or assumed future increases); and
• longevity risk: an increase in average life spans (or assumed life expectancy).
These risks are managed by:
• investing in insured annuity policies: the income from these policies exactly matches the benefit
payments for the members covered, removing all of the above risks. At the reporting date the
insured annuity policies covered 15% of total liabilities;
• investing a proportion of assets in other classes such as government and corporate bonds and
in liability driven investments: changes in the values of the assets aim to broadly match changes
in the values of the uninsured liabilities, reducing the investment risk, however some risk remains
as the durations of the bonds are typically shorter than those of the liabilities and so the values
may still move differently. At the reporting date non-equity assets amounted to 98% of assets
excluding the insured annuity policies;
• investing a proportion of assets in equities: with the aim of achieving outperformance and so
reducing the deficits over the long term. At the reporting date this amounted to 2% of assets
excluding the insured annuity policies; and
• the gradual sale of equities over time to purchase additional annuity policies or liability matching
investments: to further reduce risk as the schemes, which are closed to future accrual, mature.
Pension scheme accounting deficits are snapshots at moments in time and are not used by
either the Group or Trustees to frame funding policy. The Group and Trustees seek to be aligned in
focusing on the long-term sustainability of the funding policy which aims to balance the interests
of the Group’s shareholders and members of the schemes. The Group and Trustees also seek
to be aligned in reducing pensions risk over the long term and at a pace which is affordable
to the Group.
Reach plc Annual Report 2023 169
Notes to the consolidated financial statements continued
21 Retirement benefit schemes continued
2023 | 2022 | |
Financial assumptions (nominal % pa) | ||
Discount rate | 4.62 | 4.90 |
Retail price inflation rate | 3.08 | 3.29 |
Consumer price inflation rate | 1.0% pa | 1.0% pa |
| lower than | lower than | |
| RPI to 2030 | RPI to 2030 | |
| and equal | and equal | |
| to RPI | to RPI | |
thereafter | thereafter | |
Rate of pension increases in deferment | 2.71 | 2.90 |
Rate of pension increases in payment | 3.34 | 3.38 |
Mortality assumptions – future life expectancies from age 65 (years) | ||
Male currently aged 65 | 21.4 | 21.6 |
Female currently aged 65 | 23.7 | 24.0 |
Male currently aged 55 | 21.0 | 21.3 |
Female currently aged 55 | 24.2 | 24.5 |
169
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 170
Notes to the consolidated financial statements continued
21 Retirement benefit schemes continued
Results continued
Effect on | Effect on | |
| liabilities | deficit | |
£m | £m | |
Discount rate +/- 1.0% pa | -185/+225 | -165/+200 |
Retail price inflation rate +/- 0.5% pa | +24/-24 | +15/-15 |
Consumer price inflation rate +/- 0.5% pa | +24/-22 | +23/-20 |
Life expectancy at age 65 +/- 1 year | +80/-85 | +70/-70 |
2023 | 2022 | |
Consolidated income statement | £m | £m |
Pension administrative expenses | (5.5) | (4.2) |
Past service costs | – | (10.6) |
Pension finance charge | (5.9) | (2.3) |
Defined benefit cost recognised in income statement | (11.4) | (17.1) |
2023 | 2022 | |
Consolidated statement of comprehensive income | £m | £m |
Actuarial gain/(loss) due to liability experience | 14.1 | (60.1) |
Actuarial (loss)/gain due to liability assumption changes | (6.9) | 940.4 |
Total liability actuarial gain | 7.2 | 880.3 |
Returns on scheme assets less than discount rate | (8.7) | (915.9) |
Impact of IFRIC 14 | 1.0 | 0.6 |
Total loss recognised in statement of comprehensive income | (0.5) | (35.0) |
170
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Reach plc Annual Report 2023 170
Notes to the consolidated financial statements continued
21 Retirement benefit schemes continued
Results continued
The inflation assumptions are based on market expectations over the period of the liabilities.
For 2022 and 2023, the inflation assumptions have been set using the full inflation curve. The RPI
assumption is set based on the break-even RPI inflation curve with a margin deducted. This margin,
called an inflation risk premium, reflects the fact that the RPI market implied inflation curve can
be affected by market distortions and as a result it is thought to overstate the underlying market
expectations for future RPI inflation. Allowing for the extent of RPI linkage on the schemes’ benefits
pre and post 2030, the average inflation risk premium has been set at 0.2% per annum to 2030 and
0.4% per annum thereafter. The CPI assumption is set based on a margin deducted from the RPI
assumption, due to lack of market data on CPI expectations. Following the UK Statistics Authority’s
announcement of the intention to align RPI with CPIH from 2030 the assumed gap between RPI and
CPI inflation is 1.0% per annum up to 2030 and 0.0% per annum beyond 2030, consistent with 2022.
The estimated impacts on the IAS 19 liabilities and on the IAS 19 deficit at the reporting date, due to
a reasonably possible change in key assumptions over the next year, are set out in the table below:
Effect on
liabilities
£m
Effect on
deficit
£m
Discount rate +/- 1.0% pa
-185/+225
-165/+200
Retail price inflation rate +/- 0.5% pa
+24/-24
+15/-15
Consumer price inflation rate +/- 0.5% pa
+24/-22
+23/-20
Life expectancy at age 65 +/- 1 year
+80/-85
+70/-70
The RPI sensitivity impacts the rate of increases in deferment for some of the pensions in the EN88
Scheme and some of the pensions in payment for all schemes except the MGN Scheme. The CPI
sensitivity impacts the rate of increases in deferment for some of the pensions in most schemes
and the rate of increases in payment for some of the pensions in payment for all schemes.
The effect on the deficit is usually lower than the effect on the liabilities due to the matching impact
on the value of the insurance contracts held in respect of some of the liabilities. Each assumption
variation represents a reasonably possible change in the assumption over the next year but might
not represent the actual effect because assumption changes are unlikely to happen in isolation.
The estimated impact of the assumption variations makes no allowance for changes in the values
of invested assets that would arise if market conditions were to change in order to give rise to the
assumption variation. If allowance were made, the estimated impact would likely be lower as the
values of invested assets would normally change in the same directions as the liability values.
The amounts included in the consolidated income statement, consolidated statement of
comprehensive income and consolidated balance sheet arising from the Group’s obligations
in respect of its defined benefit pension schemes are as follows:
Consolidated income statement
2023
£m
2022
£m
Pension administrative expenses
(5.5)
(4.2)
Past service costs
–
(10.6)
Pension finance charge
(5.9)
(2.3)
Defined benefit cost recognised in income statement
(11.4)
(17.1)
Consolidated statement of comprehensive income
2023
£m
2022
£m
Actuarial gain/(loss) due to liability experience
14.1
(60.1)
Actuarial (loss)/gain due to liability assumption changes
(6.9)
940.4
Total liability actuarial gain
7.2
880.3
Returns on scheme assets less than discount rate
(8.7)
(915.9)
Impact of IFRIC 14
1.0
0.6
Total loss recognised in statement of comprehensive income
(0.5)
(35.0)
Reach plc Annual Report 2023 171
Notes to the consolidated financial statements continued
21 Retirement benefit schemes continued
Results continued
2023 | 2022 | |
Consolidated balance sheet | £m | £m |
Present value of uninsured scheme liabilities | (1,557.7) | (1,571.5) |
Present value of insured scheme liabilities | (277.9) | (288.5) |
Total present value of scheme liabilities | (1,835.6) | (1,860.0) |
Invested and cash assets at fair value | 1,455.1 | 1,421.8 |
Value of liability matching insurance contracts | 277.9 | 288.5 |
Total fair value of scheme assets | 1,733.0 | 1,710.3 |
Funded deficit | (102.6) | (149.7) |
Impact of IFRIC 14 | (0.2) | (1.2) |
Net scheme deficit | (102.8) | (150.9) |
Non-current assets – retirement benefit assets | 66.0 | 51.2 |
Non-current liabilities – retirement benefit obligations | (168.8) | (202.1) |
Net scheme deficit | (102.8) | (150.9) |
Net scheme deficit included in consolidated balance sheet | (102.8) | (150.9) |
Deferred tax included in consolidated balance sheet | 25.7 | 37.0 |
Net scheme deficit after deferred tax | (77.1) | (113.9) |
2023 | 2022 | |
Movement in net scheme deficit | £m | £m |
Opening net scheme deficit | (150.9) | (153.9) |
Contributions | 60.0 | 55.1 |
Consolidated income statement | (11.4) | (17.1) |
Consolidated statement of comprehensive income | (0.5) | (35.0) |
Closing net scheme deficit | (102.8) | (150.9) |
2023 | 2022 | |
Changes in the present value of scheme liabilities | £m | £m |
Opening present value of scheme liabilities | (1,860.0) | (2,788.4) |
Past service costs | – | (10.6) |
Interest cost | (88.5) | (49.9) |
Actuarial gain/(loss) – experience | 14.1 | (60.1) |
Actuarial gain – change to demographic assumptions | 35.7 | 6.7 |
Actuarial (loss)/gain – change to financial assumptions | (42.6) | 933.7 |
Benefits paid | 105.7 | 108.6 |
Closing present value of scheme liabilities | (1,835.6) | (1,860.0) |
2023 | 2022 | |
Impact of IFRIC 14 | £m | £m |
Opening impact of IFRIC 14 | (1.2) | (1.8) |
Decrease in impact of IFRIC 14 | 1.0 | 0.6 |
Closing impact of IFRIC 14 | (0.2) | (1.2) |
2023 | 2022 | |
Changes in the fair value of scheme assets | £m | £m |
Opening fair value of scheme assets | 1,710.3 | 2,636.3 |
Interest income | 82.6 | 47.6 |
Actual return on assets less than discount rate | (8.7) | (915.9) |
Contributions by employer | 60.0 | 55.1 |
Benefits paid | (105.7) | (108.6) |
Administrative expenses | (5.5) | (4.2) |
Closing fair value of scheme assets | 1,733.0 | 1,710.3 |
171
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 172
Notes to the consolidated financial statements continued
21 Retirement benefit schemes continued
2023 | 2022 | |
Fair value of scheme assets | £m | £m |
UK equities | 2.2 | 27.5 |
Other overseas equities | 32.5 | 76.9 |
Property | 28.3 | 33.2 |
Corporate bonds | 279.0 | 315.9 |
Fixed interest gilts | 1.1 | 6.7 |
Liability driven investment | 1,029.2 | 816.5 |
Cash and other | 82.8 | 145.1 |
Invested and cash assets at fair value | 1,455.1 | 1,421.8 |
Value of insurance contracts | 277.9 | 288.5 |
Fair value of scheme assets | 1,733.0 | 1,710.3 |
22 Inventories
2023 | 2022 | |
£m | £m | |
Raw materials and consumables | 11.4 | 12.9 |
2023 | 2022 | |
Trade and other receivables | £m | £m |
Gross trade receivables | 58.8 | 56.6 |
Expected credit loss | (1.0) | (1.4) |
Net trade receivables | 57.8 | 55.2 |
Prepayments | 9.6 | 12.7 |
Accrued income | 13.2 | 20.9 |
Other receivables | 4.5 | 6.4 |
85.1 | 95.2 |
2023 | 2022 | |
Ageing of past due receivables | £m | £m |
60–90 days | 1.8 | 2.9 |
90–120 days | 1.3 | 0.7 |
120 days+ | 0.5 | 1.0 |
3.6 | 4.6 |
2023 | 2022 | |
Movement in allowance for doubtful debts | £m | £m |
Opening balance | 1.4 | 1.1 |
Impairment losses recognised | 0.2 | 0.5 |
Utilisation of provision | (0.6) | (0.2) |
Closing balance | 1.0 | 1.4 |
2023 | 2022 | |
Ageing of impaired receivables | £m | £m |
120+ days | 1.0 | 1.4 |
1.0 | 1.4 |
172
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 172
Notes to the consolidated financial statements continued
21 Retirement benefit schemes continued
Fair value of scheme assets
2023
£m
2022
£m
UK equities
2.2
27.5
Other overseas equities
32.5
76.9
Property
28.3
33.2
Corporate bonds
279.0
315.9
Fixed interest gilts
1.1
6.7
Liability driven investment
1,029.2
816.5
Cash and other
82.8
145.1
Invested and cash assets at fair value
1,455.1
1,421.8
Value of insurance contracts
277.9
288.5
Fair value of scheme assets
1,733.0
1,710.3
The assets of the schemes are primarily held in pooled investment vehicles which are unquoted.
The pooled investment vehicles hold both quoted and unquoted investments. Scheme assets
include neither direct investments in the Company’s ordinary shares nor any property assets
occupied nor other assets used by the Group.
22 Inventories
2023
£m
2022
£m
Raw materials and consumables
11.4
12.9
23 Trade and other receivables
Trade and other receivables
2023
£m
2022
£m
Gross trade receivables
58.8
56.6
Expected credit loss
(1.0)
(1.4)
Net trade receivables
57.8
55.2
Prepayments
9.6
12.7
Accrued income
13.2
20.9
Other receivables
4.5
6.4
85.1
95.2
Net trade receivables
Trade receivables net of expected credit loss at the reporting date amounted to £57.8m
(2022: £55.2m). The average credit period taken on sales is 38 days (2022: 34 days). No interest
is charged on the receivables.
Before accepting any new customers, the Group, where appropriate, uses an external credit
scoring system to assess the potential customer’s credit quality and defines credit limits by
customer. Limits attributed to customers are reviewed during the period where appropriate.
There are two (2022: two) customers who individually represent more than 10% of net trade
receivables. Included in the net trade receivables balance are debtors with a carrying amount of
£3.6m (2022: £4.6m) which are past their due date at the reporting date for which the Group has
not provided as there has not been a significant change in credit quality and the amounts are still
considered recoverable. The Group does not hold any collateral over these balances. The average
age of these receivables is 92 days (2022: 89 days).
Ageing of past due receivables
2023
£m
2022
£m
60–90 days
1.8
2.9
90–120 days
1.3
0.7
120 days+
0.5
1.0
3.6
4.6
Movement in allowance for doubtful debts
2023
£m
2022
£m
Opening balance
1.4
1.1
Impairment losses recognised
0.2
0.5
Utilisation of provision
(0.6)
(0.2)
Closing balance
1.0
1.4
Ageing of impaired receivables
2023
£m
2022
£m
120+ days
1.0
1.4
1.0
1.4
The carrying amount of trade and other receivables approximates their fair value.
Reach plc Annual Report 2023 173
Notes to the consolidated financial statements continued
IFRS 16 lease liabilities | |||||||
movement | |||||||
| 26 | 31 | ||||||
| December | Cash | Loan | New | Other | December | ||
| 2022 | flow | drawdown | Interest | leases m ovements | 2023 | ||
£m | £m | £m | £m | £m | £m | £m | |
Liabilities from financing | |||||||
activities | |||||||
Borrowings | (15.0) | – | (15.0) | – | – | – | (30.0) |
Lease liabilities | (31.7) | 5.9 | – | (1.2) | (6.1) | (0.1) | (33.2) |
(46.7) | 5.9 | (15.0) | (1.2) | (6.1) | (0.1) | (63.2) | |
Current assets | |||||||
Cash and cash equivalents | 40.4 | (35.5) | 15.0 | – | – | – | 19.9 |
Net cash less lease liabilities | (6.3) | (43.3) | |||||
Net cash/(debt) | 25.4 | (35.5) | – | – | – | – | (10.1) |
IFRS 16 lease liabilities | ||||||
movement | ||||||
| 27 December | Cash | Loan | New | 25 December | ||
| 2021 | flow | drawdown | Interest | leases | 2022 | |
£m | £m | £m | £m | £m | £m | |
Liabilities from financing activities | ||||||
Borrowings | – | – | (15.0) | – | – | (15.0) |
Lease liabilities | (36.2) | 6.7 | – | (1.1) | (1.1) | (31.7) |
(36.2) | 6.7 | (15.0) | (1.1) | (1.1) | (46.7) | |
Current assets | ||||||
Cash and cash equivalents | 65.7 | (40.3) | 15.0 | – | – | 40.4 |
Net cash less lease liabilities | 29.5 | (6.3) | ||||
Net cash | 65.7 | (40.3) | – | – | – | 25.4 |
Acquisition deferred consideration
In 2022, deferred consideration (which is shown separately on the face of the consolidated balance
sheet) was in respect of the acquisition of Express & Star. Payment of the first instalment of £18.9m
was made on 28 February 2020. The second instalment of £16.0m was made on 28 February 2021
and the third instalment of £17.1m was made on 28 February 2022. The remaining amount of £7.0m
was paid on 28 February 2023. There were no conditions attached to the payment of the deferred
consideration and the transaction was structured such that no interest accrued on these
payments. However, under the sale and purchase agreement the Group has the right to offset
agreed claims arising from a breach of warranties and indemnities and can also offset any
shortfalls on the contracted advertising from the Health Lottery. The deferred consideration was
not discounted as we did not believe that the impact of such discounting was material. At the
reporting date, there was no deferred consideration balance remaining.
| 2023 | 2022 | |
Trade and other payables | £m | £m |
Trade payables | (19.5) | (26.9) |
Social security and other taxes | (6.4) | (6.4) |
Accruals | (36.7) | (39.2) |
Deferred income | (10.4) | (11.6) |
Other payables | (24.3) | (27.1) |
(97.3) | (111.2) |
173
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 174
Notes to the consolidated financial statements continued
26 Trade and other payables continued
2023 | 2022 | |
£m | £m | |
Current | (96.2) | (106.7) |
Non-current | (1.1) | (4.5) |
(97.3) | (111.2) |
Share- | ||||||
| based | Historical | |||||
| payments | Property | Restructuring | legal issues | Other | Total | |
£m | £m | £m | £m | £m | £m | |
At 26 December 2022 | (0.9) | (9.4) | (6.6) | (43.0) | (3.0) | (62.9) |
Charged to income statement | (0.1) | (10.3) | (27.0) | (5.9) | (0.8) | (44.1) |
Released to income statement | 0.3 | 0.2 | 0.1 | 26.1 | 0.1 | 26.8 |
Utilisation of provision | 0.2 | 2.4 | 18.8 | 4.6 | 1.5 | 27.5 |
Reclassification | – | (2.0) | 2.0 | – | – | – |
At 31 December 2023 | (0.5) | (19.1) | (12.7) | (18.2) | (2.2) | (52.7) |
2023 | 2022 | |
£m | £m | |
Current | (26.1) | (26.3) |
Non-current | (26.6) | (36.6) |
(52.7) | (62.9) |
174
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 174
Notes to the consolidated financial statements continued
26 Trade and other payables continued
The trade and other payables have been analysed between current and non-current as follows:
2023
£m
2022
£m
Current
(96.2)
(106.7)
Non-current
(1.1)
(4.5)
(97.3)
(111.2)
Trade payables principally comprise amounts outstanding for trade purchases and ongoing costs.
The average credit period taken for trade purchases is 28 days (2022: 37 days). For most suppliers
no interest is charged on the trade payables for the first 60 days from the date of the invoice.
Thereafter, interest is charged on the outstanding balances at various interest rates. The Group
has financial risk management policies in place to ensure that all payables are paid within the
credit timeframe. The carrying amount of trade payables approximates to their fair value.
27 Provisions
Share-
based
payments
£m
Property
£m
Restructuring
£m
Historical
legal issues
£m
Other
£m
Total
£m
At 26 December 2022
(0.9)
(9.4)
(6.6)
(43.0)
(3.0)
(62.9)
Charged to income statement
(0.1)
(10.3)
(27.0)
(5.9)
(0.8)
(44.1)
Released to income statement
0.3
0.2
0.1
26.1
0.1
26.8
Utilisation of provision
0.2
2.4
18.8
4.6
1.5
27.5
Reclassification
–
(2.0)
2.0
–
–
–
At 31 December 2023
(0.5)
(19.1)
(12.7)
(18.2)
(2.2)
(52.7)
The provisions have been analysed between current and non-current as follows:
2023
£m
2022
£m
Current
(26.1)
(26.3)
Non-current
(26.6)
(36.6)
(52.7)
(62.9)
The share-based payments provision relates to National Insurance obligations attached to the
future crystallisation of awards. This provision will be utilised over the next three years.
The property provision relates to property-related onerous contracts and onerous committed costs
related to vacant properties. The provision will be utilised over the remaining term of the leases or
expected period of vacancy.
The restructuring provision relates to restructuring charges incurred in the delivery of cost reduction
measures. The net charge of £26.9m principally relates to cost management actions taken in
the period (note 8). The severance costs provision is expected to be utilised within the next year.
A provision of £2.0m for closure costs relating to a print plant has been reclassified to property
to better reflect the nature of the provision.
The historical legal issues provision relates to the cost associated with dealing with and resolving
civil claims in relation to historical phone hacking and unlawful information gathering. Previously
there have been three parts to the provision: known claims, potential future claims and common
court costs. The key uncertainties in relation to this matter relate to how each claim progresses, the
amount of any settlement and the associated legal costs. Our assumptions have been based on
historical trends, our experience and the expected evolution of claims and costs. The known and
common costs part of the provision is calculated using the most likely outcome method, with the
expected value method being used previously for the potential claims provision.
In December 2023, a judgment was handed down in respect of test claims and as a result all
claims issued after 31 October 2020 are now likely to be dismissed other than where individuals
can demonstrate specific exceptional circumstances. This has significantly reduced the amounts
that are expected to be paid out and has resulted in a change to the provision estimate and a
net decrease of £20.2m (2022: £11.0m increase) in the year. At the period end, a provision of £18.2m
remains outstanding and this represents the current best estimate of the amount required to
resolve this historical matter. The majority of the provision is expected to be utilised within the
next two years (2022: three years).
Our view on the range of outcomes at the reporting date for the provision, applying more and less
favourable outcomes to all aspects of the provision is £12m to £22m (2022: £32m to £56m). Despite
making a best estimate, the timing of utilisation and ongoing legal matters related to provided for
claims could mean that the final outcome is outside of the range of outcomes. Successful appeal
is considered remote.
The other provision balance of £2.2m at the period end relates to libel and other matters and is
expected to be utilised over the next two years.
Reach plc Annual Report 2023 175
Notes to the consolidated financial statements continued
Retirement | |||||||
| Accelerated tax | Other short- | benefit | Share-based | ||||
| depreciation | Tax losses | term timing | Intangibles | obligations | payments | Total | |
£m | £m | £m | £m | £m | £m | £m | |
At 27 December 2021 | (22.8) | – | (1.3) | (204.7) | 36.7 | 4.0 | (188.1) |
Credit/(charge) to consolidated income statement | 0.9 | – | (1.6) | – | (7.1) | (0.9) | (8.7) |
Credit to other comprehensive income statement | – | – | – | – | 7.4 | – | 7.4 |
Charge to statement of changes in equity | – | – | – | – | – | (2.2) | (2.2) |
At 25 December 2022 | (21.9) | – | (2.9) | (204.7) | 37.0 | 0.9 | (191.6) |
Credit/(charge) to consolidated income statement | 1.3 | 3.1 | (1.2) | – | (11.4) | (0.4) | (8.6) |
Credit to other comprehensive income statement | – | – | – | – | 0.1 | – | 0.1 |
At 31 December 2023 | (20.6) | 3.1 | (4.1) | (204.7) | 25.7 | 0.5 | (200.1) |
Retirement | |||||||
| Accelerated tax | Other short- | benefit | Share-based | ||||
| depreciation | Tax losses | term timing | Intangibles | obligations | payments | Total | |
£m | £m | £m | £m | £m | £m | £m | |
Within one year | (1.3) | 3.1 | (0.9) | – | 11.2 | (0.2) | 11.9 |
More than one year | (19.3) | – | (3.2) | (204.7) | 14.5 | 0.7 | (212.0) |
At 31 December 2023 | (20.6) | 3.1 | (4.1) | (204.7) | 25.7 | 0.5 | (200.1) |
175
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 176
Notes to the consolidated financial statements continued
(Accumulated | ||||||
| Share | Capital | loss)/retained | ||||
| Share | premium | Merger | redemption | earnings and | ||
| capital | account | reserve | reserve | other reserves | Total | |
£m | £m | £m | £m | £m | £m | |
At 27 December 2021 | 32.2 | 605.4 | 17.4 | 4.4 | (20.6) | 638.8 |
Total comprehensive income for the period | – | – | – | – | 23.0 | 23.0 |
Purchase of own shares | – | – | – | – | (1.0) | (1.0) |
Credit to equity for equity-settled share-based payments | – | – | – | – | 1.8 | 1.8 |
Deferred tax charge for equity-settled share-based payments | – | – | – | – | (2.2) | (2.2) |
Dividends paid | – | – | – | – | (22.9) | (22.9) |
At 25 December 2022 | 32.2 | 605.4 | 17.4 | 4.4 | (21.9) | 637.5 |
Total comprehensive income for the period | – | – | – | – | 21.5 | 21.5 |
Credit to equity for equity-settled share-based payments | – | – | – | – | 1.3 | 1.3 |
Dividends paid | – | – | – | – | (23.1) | (23.1) |
Capital reduction | – | (605.4) | – | – | 605.4 | – |
At 31 December 2023 | 32.2 | – | 17.4 | 4.4 | 583.2 | 637.2 |
176
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 176
Notes to the consolidated financial statements continued
29 Share capital and reserves
Share
capital
£m
Share
premium
account
£m
Merger
reserve
£m
Capital
redemption
reserve
£m
(Accumulated
loss)/retained
earnings and
other reserves
£m
Total
£m
At 27 December 2021
32.2
605.4
17.4
4.4
(20.6)
638.8
Total comprehensive income for the period
–
–
–
–
23.0
23.0
Purchase of own shares
–
–
–
–
(1.0)
(1.0)
Credit to equity for equity-settled share-based payments
–
–
–
–
1.8
1.8
Deferred tax charge for equity-settled share-based payments
–
–
–
–
(2.2)
(2.2)
Dividends paid
–
–
–
–
(22.9)
(22.9)
At 25 December 2022
32.2
605.4
17.4
4.4
(21.9)
637.5
Total comprehensive income for the period
–
–
–
–
21.5
21.5
Credit to equity for equity-settled share-based payments
–
–
–
–
1.3
1.3
Dividends paid
–
–
–
–
(23.1)
(23.1)
Capital reduction
–
(605.4)
–
–
605.4
–
At 31 December 2023
32.2
–
17.4
4.4
583.2
637.2
Reach plc Annual Report 2023 177
Notes to the consolidated financial statements continued
29 Share capital and reserves continued
2023 | 2023 | 2022 | 2022 | |
Number | £m | Number | £m | |
Allotted, called up and fully paid ordinary | ||||
shares of 10 pence each Opening balance and closing balance | 322,085,269 | 32.2 | 322,085,269 | 32.2 |
177
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 178
Notes to the consolidated financial statements continued
30 Share capital continued
31 Share premium account
| 2023 | 2022 | |
£m | £m | |
Opening balance | 605.4 | 605.4 |
Capital reduction | (605.4) | – |
Closing balance | – | 605.4 |
On 18 December 2023, a capital reduction of £605.4m became effective. The balance on the share
premium account of £605.4m was cancelled, creating distributable reserves of the same amount
within retained earnings.
32 Share-based payments
The charge related to share-based payments during the period was £1.3m (2022: £1.5m).
Long Term Incentive Plan
Under these schemes, the Remuneration Committee can recommend the grant of awards of
shares to an eligible employee. Full details of how the schemes operate are explained in the
Remuneration Report on pages 104 to 126. The vesting period is three years and is subject to
continued employment of the participant. The Performance Shares granted in 2022 vest if targets
measuring the Company’s share price, net cash flow and ARPU are met. The Performance Shares
granted in 2023 vest if targets measuring the Company’s share price, ARPU and RPM are met.
2023 | 2022 | |
| Performance | Performance | |
Shares | Shares | |
Awards outstanding at start of period | 8,111,869 | 8,897,087 |
Granted during the period | 4,709,530 | 1,923,861 |
Dividend accrued granted during the period | 1,775 | 714 |
Lapsed during the period | (2,699,235) | (177,841) |
Exercised during the period | (1,076,253) | (2,531,952) |
Awards outstanding at end of period | 9,047,686 | 8,111,869 |
During the year, awards relating to 1,623,678 shares were granted to executive directors on a
discretionary basis under the Long Term Incentive Plan (2022: 667,448). The exercise price of each
award is £1 for each block of awards granted. The awards vest after three years, subject to the
continued employment of the participant and satisfaction of certain performance conditions,
and are required to be held for a further two years.
During the year, awards relating to 3,085,852 shares were granted to senior managers on a
discretionary basis under the Long Term Incentive Plan (2022: 1,256,413). The exercise price of each
award is £1 for each block of awards granted. The awards vest after three years, subject to the
continued employment of the participant and satisfaction of certain performance conditions.
The estimated fair values at the date of grant of the shares awarded are as follows:
Awarded in | Awarded in | Awarded in | Awarded in | Awarded in | |
| 2023 | 2022 | 2021 | 2020 | 2019 | |
£ | £ | £ | £ | £ | |
Performance Shares | 2,455,648 | 1,919,693 | 2,881,556 | 2,420,546 | 1,695,375 |
During the period, awards relating to 394,666 shares were granted to an executive director under
the Long Term Incentive Plan representing a buy-out of awards that were forfeited on joining the
Group. The awards vest in line with the original vesting dates of the forfeited awards, subject to the
continued employment up to the relevant vesting dates. 95,760 of these shares had a vesting date
in 2023.
Save As You Earn Plan
In 2021, awards relating to 1,500,736 shares were granted to employees on a discretionary basis
under the Save As You Earn Plan. The exercise price of each award is 246.0 pence. The awards vest
after three years, subject to the continued employment of the participant. The estimated fair value
of the options was £1,753,760.
178
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 178
Notes to the consolidated financial statements continued
30 Share capital continued
TIH Employee Benefit Trust
An Employee Benefit Trust administered by the Trustee Zedra Trust Company (Guernsey) Limited
held shares of the Company for subsequent transfer to employees under a Restricted Share Plan.
The TIH Employee Benefit Trust was wound up on 31 August 2023, and the 94,740 shares held in this
trust were transferred to the Trinity Mirror Employees’ Benefit Trust. As a result, at the reporting date,
nil shares (2022: 94,740 shares) were held with a carrying value of nil (2022: £445,523) and a market
value of nil (2022: £89,908), none of which (2022: none) had options granted over them under the
Restricted Share Plan.
31 Share premium account
2023
£m
2022
£m
Opening balance
605.4
605.4
Capital reduction
(605.4)
–
Closing balance
–
605.4
On 18 December 2023, a capital reduction of £605.4m became effective. The balance on the share
premium account of £605.4m was cancelled, creating distributable reserves of the same amount
within retained earnings.
32 Share-based payments
The charge related to share-based payments during the period was £1.3m (2022: £1.5m).
Long Term Incentive Plan
Under these schemes, the Remuneration Committee can recommend the grant of awards of
shares to an eligible employee. Full details of how the schemes operate are explained in the
Remuneration Report on pages 104 to 126. The vesting period is three years and is subject to
continued employment of the participant. The Performance Shares granted in 2022 vest if targets
measuring the Company’s share price, net cash flow and ARPU are met. The Performance Shares
granted in 2023 vest if targets measuring the Company’s share price, ARPU and RPM are met.
2023
Performance
Shares
2022
Performance
Shares
Awards outstanding at start of period
8,111,869
8,897,087
Granted during the period
4,709,530
1,923,861
Dividend accrued granted during the period
1,775
714
Lapsed during the period
(2,699,235)
(177,841)
Exercised during the period
(1,076,253)
(2,531,952)
Awards outstanding at end of period
9,047,686
8,111,869
During the year, awards relating to 1,623,678 shares were granted to executive directors on a
discretionary basis under the Long Term Incentive Plan (2022: 667,448). The exercise price of each
award is £1 for each block of awards granted. The awards vest after three years, subject to the
continued employment of the participant and satisfaction of certain performance conditions,
and are required to be held for a further two years.
During the year, awards relating to 3,085,852 shares were granted to senior managers on a
discretionary basis under the Long Term Incentive Plan (2022: 1,256,413). The exercise price of each
award is £1 for each block of awards granted. The awards vest after three years, subject to the
continued employment of the participant and satisfaction of certain performance conditions.
The average exercise period of awards outstanding at the reporting date is 12 months (2022:
12 months). The share price at the date of grant for the Performance Shares was 75.8 pence for
4,591,398 shares and 82.95 pence for 118,132 shares (2022: 168.6 pence for 1,805,312 shares and
70.2 pence for 118,549 shares). The weighted average share price at the date of lapse for awards
lapsed during the period was 75.8 pence (2022: 127.9 pence). The weighted average share price
at the date of exercise for awards exercised during the period was 75.6 pence (2022: 119.0 pence).
The estimated fair values at the date of grant of the shares awarded are as follows:
Awarded in
2023
£
Awarded in
2022
£
Awarded in
2021
£
Awarded in
2020
£
Awarded in
2019
£
Performance Shares
2,455,648
1,919,693
2,881,556
2,420,546
1,695,375
During the period, awards relating to 394,666 shares were granted to an executive director under
the Long Term Incentive Plan representing a buy-out of awards that were forfeited on joining the
Group. The awards vest in line with the original vesting dates of the forfeited awards, subject to the
continued employment up to the relevant vesting dates. 95,760 of these shares had a vesting date
in 2023.
Save As You Earn Plan
In 2021, awards relating to 1,500,736 shares were granted to employees on a discretionary basis
under the Save As You Earn Plan. The exercise price of each award is 246.0 pence. The awards vest
after three years, subject to the continued employment of the participant. The estimated fair value
of the options was £1,753,760.
Reach plc Annual Report 2023 179
Notes to the consolidated financial statements continued
32 Share-based payments continued
The fair values for the Performance Shares and Save As You Earn Plan were calculated using a stochastic (Monte-Carlo binomial) model at the date of grant. The inputs to the model for awards from 2020
were as follows:
Performance | Performance | Performance | Performance | Save As You | Performance | Performance | Performance | |
| Shares 2023 | Shares 2023 | Shares 2022 | Shares 2022 | Earn Plan 2021 | Shares 2021 | Shares 2020 | Shares 2020 | |
| 12 October | 13 April | 12 October | 11 April | 14 July | 11 May | 3 April | 27 March | |
2023 | 2023 | 2022 | 2022 | 2021 | 2021 | 2020 | 2020 | |
Expected volatility (%) | 62.2 | 63.5 | 65.4 | 58.9 | 50.8 | 54.0 | 43.8 | 43.4 |
Expected life (years) | 2.5 | 3.0 | 2.5 | 3.0 | 3.4 | 3.0 | 3.0 | 3.0 |
Risk-free (%) | 4.5 | 3.5 | 4.1 | 1.7 | 0.2 | 0.1 | 0.1 | 0.1 |
Expected volatility has been determined by calculating the historical volatility of the Company’s
share price over the three-year period prior to the grant date. The exercise price used in the model
is nil as the exercise price of the granted awards is £1 for each block of awards granted.
Restricted Share Plan
During the year, no awards relating to shares were granted to executive directors under the
Restricted Share Plan (2022: 121,575 shares). The award vests after three years.
2023 | 2022 | |
£m | £m | |
Net debt | (10.1) | – |
Adjusted EBITDA (note 36) | 118.1 | 126.3 |
Net debt to EBITDA | 0.1 | n/a |
Adjusted operating profit | 96.5 | 106.1 |
Interest and charges on borrowings | (3.3) | (1.8) |
Interest cover | 29.2 | 58.9 |
179
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 180
Notes to the consolidated financial statements continued
33 Financial instruments continued
2023 | 2022 | ||
notes | £m | £m | |
Financial assets | |||
Net trade receivables | 23 | 57.8 | 55.2 |
Accrued income | 23 | 13.2 | 20.9 |
Other receivables | 23 | 4.5 | 6.4 |
Finance lease receivable | 19 | – | 11.0 |
Cash and cash equivalents | 24 | 19.9 | 40.4 |
95.4 | 133.9 | ||
Financial liabilities | |||
Trade payables | 26 | (19.5) | (26.9) |
Accruals | 26 | (36.7) | (39.2) |
Other payables | 26 | (24.3) | (27.1) |
Deferred consideration | 24 | – | (7.0) |
Borrowings | 24 | (30.0) | (15.0) |
Lease liabilities | 19 | (33.2) | (31.7) |
(143.7) | (146.9) |
Liabilities | Assets | |||
2023 | 2022 | 2023 | 2022 | |
£m | £m | £m | £m | |
Euro | – | – | 1.4 | 1.1 |
US$ | – | – | 0.3 | 0.2 |
180
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 180
Notes to the consolidated financial statements continued
33 Financial instruments continued
Significant accounting policies
Details of the significant accounting policies and methods adopted, including the criteria
for recognition, the basis of measurement and the basis on which income and expenses are
recognised, in respect of each class of financial asset, financial liability and equity instrument,
are disclosed in note 3.
Categories of financial instruments
The Group recognises the following financial instruments on its balance sheet which are held at
amortised cost.
notes
2023
£m
2022
£m
Financial assets
Net trade receivables
23
57.8
55.2
Accrued income
23
13.2
20.9
Other receivables
23
4.5
6.4
Finance lease receivable
19
–
11.0
Cash and cash equivalents
24
19.9
40.4
95.4
133.9
Financial liabilities
Trade payables
26
(19.5)
(26.9)
Accruals
26
(36.7)
(39.2)
Other payables
26
(24.3)
(27.1)
Deferred consideration
24
–
(7.0)
Borrowings
24
(30.0)
(15.0)
Lease liabilities
19
(33.2)
(31.7)
(143.7)
(146.9)
Financial risk management objectives
The Group’s Treasury function provides services to the business, co-ordinates access to domestic
and international financial markets and monitors and manages the financial risks relating to the
operations of the Group through regular meetings with the Chief Financial Officer and by analysing
exposures by degree and magnitude of risk. These risks include market risk (including currency risk,
fair value interest rate risk and price risk), credit risk, liquidity risk and cash flow interest rate risk.
The Group seeks to minimise the effects of these risks by using derivative financial instruments
where appropriate to hedge these exposures. The use of financial derivatives is governed by
policies approved by the Board, which provide written principles on foreign exchange risk, interest
rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments and
the investment of excess liquidity. Compliance with policies and exposure limits is reviewed by
the internal auditors on a continuous basis.
The Group does not enter into or trade financial instruments, including derivative financial
instruments, for speculative purposes. The Group did not enter into any derivative financial
instruments in 2023 (2022: none).
The Group’s Treasury function provides regular updates to the Board covering compliance with
covenants and other Treasury-related matters.
Market risk
The Group’s activities expose it primarily to the financial risks of changes in foreign currency
exchange rates and interest rates.
Foreign currency risk management
The Group undertakes certain transactions denominated in foreign currencies. Hence, exposures
to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy
parameters utilising forward exchange contracts where appropriate.
The carrying amounts of the Group’s foreign currency denominated monetary assets and
monetary liabilities at the reporting date are as follows:
Liabilities
Assets
2023
£m
2022
£m
2023
£m
2022
£m
Euro
–
–
1.4
1.1
US$
–
–
0.3
0.2
Reach plc Annual Report 2023 181
Notes to the consolidated financial statements continued
33 Financial instruments continued
181
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 182
Notes to the consolidated financial statements continued
33 Financial instruments continued
Credit risk management continued
Between | Greater | |||
| Less than | one and | than five | ||
| one year | five years | years | Total | |
2023 non-derivative financial liabilities | £m | £m | £m | £m |
Trade payables | (19.5) | – | – | (19.5) |
Accruals | (36.7) | – | – | (36.7) |
Other payables | (24.3) | – | – | (24.3) |
Borrowings | (30.0) | – | – | (30.0) |
Lease liabilities | (5.7) | (20.9) | (12.1) | (38.7) |
Total cash flows | (116.2) | (20.9) | (12.1) | (149.2) |
Between | Greater | |||
| Less than | one and | than five | ||
| one year | five years | years | Total | |
2022 non-derivative financial liabilities | £m | £m | £m | £m |
Trade payables | (26.9) | – | – | (26.9) |
Accruals | (39.2) | – | – | (39.2) |
Other payables | (27.1) | – | – | (27.1) |
Deferred consideration | (7.0) | – | – | (7.0) |
Borrowings | (15.0) | – | – | (15.0) |
Lease liabilities | (5.6) | (19.0) | (11.3) | (35.9) |
Total cash flows | (120.8) | (19.0) | (11.3) | (151.1) |
182
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 182
Notes to the consolidated financial statements continued
33 Financial instruments continued
Credit risk management continued
The Group defines counterparties as having similar characteristics if they are connected entities.
Concentration of credit risk with a single counterparty is limited by reference to the long-term
credit ratings assigned for that counterparty by Standard and Poor’s. The credit risk on liquid funds
is limited because the counterparties are banks with high credit ratings assigned by international
credit rating agencies.
The Group’s cash and cash equivalents of £19.9m (2022: £40.4m) is held with counterparties with
a minimum Standard and Poor’s credit rating of A. The Group monitors the exposure and credit
rating of its counterparties on a regular basis.
The carrying amount of financial assets recorded in the financial statements, which is net of
impairment losses, represents the Group’s maximum exposure to credit risk.
Liquidity risk management
Liquidity risk results from having insufficient financial resources to meet day-to-day fluctuations in
working capital and cash flow. Ultimate responsibility for liquidity risk management rests with the
Board. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and
reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and by
matching the maturity profiles of financial assets and liabilities, which include deferred
consideration payments as set out in note 24.
Liquidity risk
At the reporting date the Group has a £30.0m (2022: £15.0m) Sterling variable interest rate
bank drawing and has access to financial facilities of which the total unused amount is £90.0m
(2022: £105.0m). The Group has a £120.0m non-amortising revolving credit facility which expires
on 19 November 2026.
The Group expects to meet its obligations from cash held on deposit, operating cash flows and its
committed financing facilities.
The table below shows the maturity analysis of the undiscounted remaining contractual cash flows
of the Group’s financial liabilities:
2023 non-derivative financial liabilities
Less than
one year
£m
Between
one and
five years
£m
Greater
than five
years
£m
Total
£m
Trade payables
(19.5)
–
–
(19.5)
Accruals
(36.7)
–
–
(36.7)
Other payables
(24.3)
–
–
(24.3)
Borrowings
(30.0)
–
–
(30.0)
Lease liabilities
(5.7)
(20.9)
(12.1)
(38.7)
Total cash flows
(116.2)
(20.9)
(12.1)
(149.2)
2022 non-derivative financial liabilities
Less than
one year
£m
Between
one and
five years
£m
Greater
than five
years
£m
Total
£m
Trade payables
(26.9)
–
–
(26.9)
Accruals
(39.2)
–
–
(39.2)
Other payables
(27.1)
–
–
(27.1)
Deferred consideration
(7.0)
–
–
(7.0)
Borrowings
(15.0)
–
–
(15.0)
Lease liabilities
(5.6)
(19.0)
(11.3)
(35.9)
Total cash flows
(120.8)
(19.0)
(11.3)
(151.1)
Reach plc Annual Report 2023 183
Notes to the consolidated financial statements continued
35 Reconciliation of statutory to adjusted results
Operating | Pension | |||
| adjusted | finance | |||
| Statutory | items | charge | Adjusted | |
| results | (a) | (b) | results | |
53 weeks ended 31 December 2023 | £m | £m | £m | £m |
Revenue | 568.6 | – | – | 568.6 |
Operating profit | 46.1 | 50.4 | – | 96.5 |
Profit before tax | 36.7 | 50.4 | 5.9 | 93.0 |
Profit after tax | 21.5 | 42.4 | 4.5 | 68.4 |
Basic earnings per share (p) | 6.8 | 13.6 | 1.4 | 21.8 |
| Operating | Pension | |||
| adjusted | finance | |||
| Statutory | items | charge | Adjusted | |
| results | (a) | (b) | results | |
52 weeks ended 25 December 2022 | £m | £m | £m | £m |
Revenue | 601.4 | – | – | 601.4 |
Operating profit | 71.3 | 34.8 | – | 106.1 |
Profit before tax | 66.2 | 34.8 | 2.3 | 103.3 |
Profit after tax | 52.3 | 30.3 | 1.9 | 84.5 |
Basic earnings per share (p) | 16.8 | 9.7 | 0.6 | 27.1 |
(a) Operating adjusted items relate to the items charged or credited to operating profit as set out
in note 8.
(b) Pension finance charge relates to the defined benefit pension schemes as set out in note 21.
Set out in note 3 is the rationale for the alternative performance measures adopted by the Group.
The reconciliations in this note highlight the impact on the respective components of the income
statement.
Items are adjusted on the basis that they distort the underlying performance of the business where
they relate to material items that can recur (including impairment, restructuring, tax rate changes)
or relate to historical liabilities (including historical legal and contractual issues, defined benefit
pension schemes which are all closed to future accrual). Other items may be included in adjusted
items if they are not expected to recur in future years, such as property rationalisation and items
such as transaction and restructuring costs incurred on acquisitions or the profit or loss on the sale
of subsidiaries, associates or freehold buildings.
183
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 184
Notes to the consolidated financial statements continued
35 Reconciliation of statutory to adjusted results continued
Impairments to non-current assets arise following impairment reviews or where a decision is made
to close or retire printing assets. These non-cash items are included in adjusted items on the basis
that they are material and vary considerably each year, distorting the underlying performance of
the business.
The opening deferred tax position is recalculated in the period in which a change in the standard
rate of corporation tax has been enacted or substantively enacted by parliament. The impacts of
the change in rates are included in adjusted items on the basis that when they occur they are
material, distorting the underlying performance of the business.
Provision for historical legal issues relates to the cost associated with dealing with and resolving civil
claims for historical phone hacking and unlawful information gathering. This is included in adjusted
items as the amounts are material, it relates to historical matters and movements in the provision
can vary year to year.
The Group’s defined benefit pension schemes are all closed to new members and to future accrual
and are therefore not related to the current business. The pension administration expenses and the
pension finance charge are included in adjusted items as the amounts are significant and they
relate to the historical pension commitment.
Included in adjusted items in 2023 are the impairment of finance lease receivable of £10.8m and
recognition of onerous costs of £8.6m of a vacant print site where the sub-lessee entered into
administration during 2023. Other adjusted items comprise impairment of vacant freehold property
(£4.3m), vacant freehold property-related costs (£1.4m), onerous lease and related costs (£2.6m),
the Group’s legal fees in respect of historical legal issues (£5.3m), adviser costs in relation to the
triennial funding valuations (£2.5m), internal pension administrative expenses (£0.6m), corporate
simplification costs (£0.5m), and other restructuring-related project costs (£0.7m) less a reduction
in National Insurance costs relating to share awards (£0.3m) and the profit on sale of impaired
assets (£0.3m). These are included in adjusted items as they relate to historical liabilities or are
one-off items not expected to recur.
Included in adjusted items in 2022 are the reversal of an impairment in right-of-use assets of £11.0m
and previously onerous costs of £5.6m due to the sublet of a vacant print site which was closed in
2020. Other adjusted items comprise the Group’s legal fees in respect of historical legal issues
(£5.2m), adviser costs in relation to the triennial funding valuations (£1.6m), impairment of vacant
freehold property (£4.2m) and plant and equipment (£0.8m) less a reduction in National Insurance
costs relating to share awards (£2.7m) and the profit on sale of impaired assets (£0.4m). These are
included in adjusted items as they relate to historical liabilities or are one-off items not expected
to recur.
36 Adjusted cash flow
2023 | 2022 | |
£m | £m | |
Adjusted operating profit | 96.5 | 106.1 |
Depreciation and amortisation | 21.6 | 20.2 |
Adjusted EBITDA | 118.1 | 126.3 |
Working capital movements | (3.9) | (12.3) |
Net capital expenditure | (15.4) | (13.3) |
Net interest paid on leases | (0.8) | (1.1) |
Finance lease receipts | 0.2 | – |
Repayment of obligation under leases | (4.7) | (5.6) |
Other | 1.3 | 0.9 |
Associates | (2.9) | (2.8) |
Adjusted operating cash flow | 91.9 | 92.1 |
Net interest and charges paid on borrowings | (2.5) | (1.8) |
Income tax paid | (0.5) | (5.0) |
Restructuring payments | (18.8) | (13.8) |
Historical legal issues payments | (4.6) | (9.0) |
Dividends paid | (23.1) | (22.9) |
Purchase of own shares | – | (1.0) |
Pension funding payments | (60.0) | (55.1) |
Dividends received from associated undertakings | 1.9 | 2.5 |
Legal fee payments in respect of historical legal issues | (5.3) | (5.2) |
Adviser cost payments in relation to triennial funding valuations | (2.5) | (1.6) |
Other adjusted items payments | (5.0) | (2.4) |
Adjusted net cash flow | (28.5) | (23.2) |
Bank facility drawdown | 15.0 | 15.0 |
Acquisition-related cash flows | (7.0) | (17.1) |
Net decrease in cash and cash equivalents | (20.5) | (25.3) |
Adjusted operating cash flow has been aligned to the definition of adjusted operating profit.
The change is largely driven by the exclusion of the cash flow impact of restructuring payments
and other items classified as adjusted items in the income statement. This has resulted in an
increase in adjusted operating cash flow in 2022 from £64.8m to £92.1m.
Reach plc Annual Report 2023 185
Notes to the consolidated financial statements continued
37 Reconciliation of statutory to adjusted cash flow
53 weeks ended 31 December 2023
Statutory
2023
£m
(a)
£m
(b)
£m
Adjusted
2023
£m
Cash flows from operating activities
Cash generated from operations
76.4
(20.7)
36.2
91.9
Adjusted operating cash flow
Pension deficit funding payments
(60.0)
–
–
(60.0)
Pension funding payments
–
–
(18.8)
(18.8)
Restructuring payments
–
–
(4.6)
(4.6)
Historical legal issues payments
–
–
(5.3)
(5.3)
Legal fee payments in respect of historical legal issues
–
–
(2.5)
(2.5)
Adviser cost payments in relation to triennial funding valuations
–
–
(5.0)
(5.0)
Other adjusted items payments
Income tax paid
(0.5)
–
–
(0.5)
Income tax paid
Net cash inflow from operating activities
15.9
Investing activities
Interest received
0.6
–
–
0.6
Net interest and charges paid on bank borrowings
Dividends received from associated undertakings
1.9
–
–
1.9
Dividends received from associated undertakings
Proceeds on disposal of property, plant and equipment
0.9
(0.9)
–
–
Net capital expenditure
Purchases of property, plant and equipment
(3.5)
3.5
–
–
Net capital expenditure
Expenditure on capitalised internally generated development
(12.8)
12.8
–
–
Net capital expenditure
Interest received on leases
0.4
(0.4)
–
–
Net interest paid on leases
Finance lease receipts
0.2
(0.2)
–
–
Finance lease receipts
Deferred consideration payment
(7.0)
–
–
(7.0)
Acquisition-related cash flow
Net cash used in investing activities
(19.3)
Financing activities
Interest and charges paid on borrowings
(3.1)
–
–
(3.1)
Net interest and charges paid on bank borrowings
Dividends paid
(23.1)
–
–
(23.1)
Dividends paid
Interest paid on leases
(1.2)
1.2
–
–
Net interest paid on leases
Repayment of obligations under leases
(4.7)
4.7
–
–
Repayment of obligation under leases
Drawdown of borrowings
15.0
–
–
15.0
Net cash used in financing activities
(17.1)
Net decrease in cash and cash equivalents
(20.5)
–
–
(20.5)
(a) Items included in the statutory cash flow on separate lines which for the adjusted cash flow are included in adjusted operating cash flow.
(b) Payments in respect of adjusted items are shown separately in the adjusted cash flow.
184
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 184
Notes to the consolidated financial statements continued
35 Reconciliation of statutory to adjusted results continued
Impairments to non-current assets arise following impairment reviews or where a decision is made
to close or retire printing assets. These non-cash items are included in adjusted items on the basis
that they are material and vary considerably each year, distorting the underlying performance of
the business.
The opening deferred tax position is recalculated in the period in which a change in the standard
rate of corporation tax has been enacted or substantively enacted by parliament. The impacts of
the change in rates are included in adjusted items on the basis that when they occur they are
material, distorting the underlying performance of the business.
Provision for historical legal issues relates to the cost associated with dealing with and resolving civil
claims for historical phone hacking and unlawful information gathering. This is included in adjusted
items as the amounts are material, it relates to historical matters and movements in the provision
can vary year to year.
The Group’s defined benefit pension schemes are all closed to new members and to future accrual
and are therefore not related to the current business. The pension administration expenses and the
pension finance charge are included in adjusted items as the amounts are significant and they
relate to the historical pension commitment.
Included in adjusted items in 2023 are the impairment of finance lease receivable of £10.8m and
recognition of onerous costs of £8.6m of a vacant print site where the sub-lessee entered into
administration during 2023. Other adjusted items comprise impairment of vacant freehold property
(£4.3m), vacant freehold property-related costs (£1.4m), onerous lease and related costs (£2.6m),
the Group’s legal fees in respect of historical legal issues (£5.3m), adviser costs in relation to the
triennial funding valuations (£2.5m), internal pension administrative expenses (£0.6m), corporate
simplification costs (£0.5m), and other restructuring-related project costs (£0.7m) less a reduction
in National Insurance costs relating to share awards (£0.3m) and the profit on sale of impaired
assets (£0.3m). These are included in adjusted items as they relate to historical liabilities or are
one-off items not expected to recur.
Included in adjusted items in 2022 are the reversal of an impairment in right-of-use assets of £11.0m
and previously onerous costs of £5.6m due to the sublet of a vacant print site which was closed in
2020. Other adjusted items comprise the Group’s legal fees in respect of historical legal issues
(£5.2m), adviser costs in relation to the triennial funding valuations (£1.6m), impairment of vacant
freehold property (£4.2m) and plant and equipment (£0.8m) less a reduction in National Insurance
costs relating to share awards (£2.7m) and the profit on sale of impaired assets (£0.4m). These are
included in adjusted items as they relate to historical liabilities or are one-off items not expected
to recur.
36 Adjusted cash flow
2023
£m
2022
£m
Adjusted operating profit
96.5
106.1
Depreciation and amortisation
21.6
20.2
Adjusted EBITDA
118.1
126.3
Working capital movements
(3.9)
(12.3)
Net capital expenditure
(15.4)
(13.3)
Net interest paid on leases
(0.8)
(1.1)
Finance lease receipts
0.2
–
Repayment of obligation under leases
(4.7)
(5.6)
Other
1.3
0.9
Associates
(2.9)
(2.8)
Adjusted operating cash flow
91.9
92.1
Net interest and charges paid on borrowings
(2.5)
(1.8)
Income tax paid
(0.5)
(5.0)
Restructuring payments
(18.8)
(13.8)
Historical legal issues payments
(4.6)
(9.0)
Dividends paid
(23.1)
(22.9)
Purchase of own shares
–
(1.0)
Pension funding payments
(60.0)
(55.1)
Dividends received from associated undertakings
1.9
2.5
Legal fee payments in respect of historical legal issues
(5.3)
(5.2)
Adviser cost payments in relation to triennial funding valuations
(2.5)
(1.6)
Other adjusted items payments
(5.0)
(2.4)
Adjusted net cash flow
(28.5)
(23.2)
Bank facility drawdown
15.0
15.0
Acquisition-related cash flows
(7.0)
(17.1)
Net decrease in cash and cash equivalents
(20.5)
(25.3)
Adjusted operating cash flow has been aligned to the definition of adjusted operating profit.
The change is largely driven by the exclusion of the cash flow impact of restructuring payments
and other items classified as adjusted items in the income statement. This has resulted in an
increase in adjusted operating cash flow in 2022 from £64.8m to £92.1m.
Reach plc Annual Report 2023 185
Notes to the consolidated financial statements continued
37 Reconciliation of statutory to adjusted cash flow
Statutory | Adjusted | ||||
| 2023 | (a) | (b) | 2023 | ||
53 weeks ended 31 December 2023 | £m | £m | £m | £m | |
Cash flows from operating activities | |||||
Cash generated from operations | 76.4 | (20.7) | 36.2 | 91.9 | Adjusted operating cash flow |
Pension deficit funding payments | (60.0) | – | – | (60.0) Pension funding payments | |
– | – | (18.8) | (18.8) Restructuring payments | ||
– | – | (4.6) | (4.6) Historical legal issues payments | ||
– | – | (5.3) | (5.3) Legal fee payments in respect of historical legal issues | ||
– | – | (2.5) | (2.5) Adviser cost payments in relation to triennial funding valuations | ||
– | – | (5.0) | (5.0) Other adjusted items payments | ||
Income tax paid | (0.5) | – | – | (0.5) Income tax paid | |
Net cash inflow from operating activities | 15.9 | ||||
Investing activities | |||||
Interest received | 0.6 | – | – | 0.6 | Net interest and charges paid on bank borrowings |
Dividends received from associated undertakings | 1.9 | – | – | 1.9 | Dividends received from associated undertakings |
Proceeds on disposal of property, plant and equipment | 0.9 | (0.9) | – | – | Net capital expenditure |
Purchases of property, plant and equipment | (3.5) | 3.5 | – | – | Net capital expenditure |
Expenditure on capitalised internally generated development | (12.8) | 12.8 | – | – | Net capital expenditure |
Interest received on leases | 0.4 | (0.4) | – | – | Net interest paid on leases |
Finance lease receipts | 0.2 | (0.2) | – | – | Finance lease receipts |
Deferred consideration payment | (7.0) | – | – | (7.0) Acquisition-related cash flow | |
Net cash used in investing activities | (19.3) | ||||
Financing activities | |||||
Interest and charges paid on borrowings | (3.1) | – | – | (3.1) Net interest and charges paid on bank borrowings | |
Dividends paid | (23.1) | – | – | (23.1) Dividends paid | |
Interest paid on leases | (1.2) | 1.2 | – | – | Net interest paid on leases |
Repayment of obligations under leases | (4.7) | 4.7 | – | – | Repayment of obligation under leases |
Drawdown of borrowings | 15.0 | – | – | 15.0 | |
Net cash used in financing activities | (17.1) | ||||
Net decrease in cash and cash equivalents | (20.5) | – | – | (20.5) | |
(a) Items included in the statutory cash flow on separate lines which for the adjusted cash flow are included in adjusted operating cash flow.
(b) Payments in respect of adjusted items are shown separately in the adjusted cash flow.
185
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 186
Notes to the consolidated financial statements continued
37 Reconciliation of statutory to adjusted cash flow continued
| Statutory | Adjusted | |||
| 2022 | (a) | (b) | 2022 | |
52 weeks ended 25 December 2022 | £m | £m | £m | £m |
Cash flows from operating activities | ||||
Cash generated from operations | 80.1 | (20.0) | 32.0 | 92.1 Adjusted operating cash flow |
Pension deficit funding payments | (55.1) | – | – | (55.1) Pension funding payments |
– | – | (13.8) | (13.8) Restructuring payments | |
– | – | (9.0) | (9.0) Historical legal issues payments | |
– | – | (5.2) | (5.2) Legal fee payments in respect of historical legal issues | |
– | – | (1.6) | (1.6) Adviser cost payments in relation to triennial funding valuations | |
– | – | (2.4) | (2.4) Other adjusted items payments | |
Income tax paid | (5.0) | – | – | (5.0) Income tax paid |
Net cash inflow from operating activities | 20.0 | |||
Investing activities | ||||
Interest received | 0.1 | – | – | 0.1 Net interest and charges paid on bank borrowings |
Dividends received from associated undertakings | 2.5 | – | – | 2.5 Dividends received from associated undertakings |
Proceeds on disposal of property, plant and equipment | 0.4 | (0.4) | – | – Net capital expenditure |
Purchases of property, plant and equipment | (3.0) | 3.0 | – | – Net capital expenditure |
Expenditure on capitalised internally generated development | (10.7) | 10.7 | – | – Net capital expenditure |
Deferred consideration payment | (17.1) | – | – | (17.1) Acquisition-related cash flow |
Net cash used in investing activities | (27.8) | |||
Financing activities | ||||
Interest and charges paid on borrowings | (1.9) | – | – | (1.9) Net interest and charges paid on bank borrowings |
Dividends paid | (22.9) | – | – | (22.9) Dividends paid |
Interest paid on leases | (1.1) | 1.1 | – | – Net interest paid on leases |
Repayment of obligations under leases | (5.6) | 5.6 | – | – Repayment of obligation under leases |
Purchase of own shares | (1.0) | – | – | (1.0) Purchase of own shares |
Drawdown of borrowings | 15.0 | – | – | 15.0 Bank facility drawdown |
Net cash used in financing activities | (17.5) | |||
Net decrease in cash and cash equivalents | (25.3) | – | – | (25.3) |
(a) Items included in the statutory cash flow on separate lines which for the adjusted cash flow are included in adjusted operating cash flow.
(b) Payments in respect of adjusted items are shown separately in the adjusted cash flow.
186
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 186
Notes to the consolidated financial statements continued
37 Reconciliation of statutory to adjusted cash flow continued
52 weeks ended 25 December 2022
Statutory
2022
£m
(a)
£m
(b)
£m
Adjusted
2022
£m
Cash flows from operating activities
Cash generated from operations
80.1
(20.0)
32.0
92.1
Adjusted operating cash flow
Pension deficit funding payments
(55.1)
–
–
(55.1)
Pension funding payments
–
–
(13.8)
(13.8)
Restructuring payments
–
–
(9.0)
(9.0)
Historical legal issues payments
–
–
(5.2)
(5.2)
Legal fee payments in respect of historical legal issues
–
–
(1.6)
(1.6)
Adviser cost payments in relation to triennial funding valuations
–
–
(2.4)
(2.4)
Other adjusted items payments
Income tax paid
(5.0)
–
–
(5.0)
Income tax paid
Net cash inflow from operating activities
20.0
Investing activities
Interest received
0.1
–
–
0.1
Net interest and charges paid on bank borrowings
Dividends received from associated undertakings
2.5
–
–
2.5
Dividends received from associated undertakings
Proceeds on disposal of property, plant and equipment
0.4
(0.4)
–
–
Net capital expenditure
Purchases of property, plant and equipment
(3.0)
3.0
–
–
Net capital expenditure
Expenditure on capitalised internally generated development
(10.7)
10.7
–
–
Net capital expenditure
Deferred consideration payment
(17.1)
–
–
(17.1)
Acquisition-related cash flow
Net cash used in investing activities
(27.8)
Financing activities
Interest and charges paid on borrowings
(1.9)
–
–
(1.9)
Net interest and charges paid on bank borrowings
Dividends paid
(22.9)
–
–
(22.9)
Dividends paid
Interest paid on leases
(1.1)
1.1
–
–
Net interest paid on leases
Repayment of obligations under leases
(5.6)
5.6
–
–
Repayment of obligation under leases
Purchase of own shares
(1.0)
–
–
(1.0)
Purchase of own shares
Drawdown of borrowings
15.0
–
–
15.0
Bank facility drawdown
Net cash used in financing activities
(17.5)
Net decrease in cash and cash equivalents
(25.3)
–
–
(25.3)
(a) Items included in the statutory cash flow on separate lines which for the adjusted cash flow are included in adjusted operating cash flow.
(b) Payments in respect of adjusted items are shown separately in the adjusted cash flow.
Reach plc Annual Report 2023 187
Notes to the consolidated financial statements continued
38 Reconciliation of statutory to like-for-like revenue
| Statutory and like- | ||||
| Statutory | Like-for-like | for-like | ||
| 2023 | (a) | 2023 | 2022 | |
2023 v 2022 | £m | £m | £m | £m |
Print | 438.8 | (5.9) | 432.9 | 448.6 |
Circulation | 312.5 | (4.7) | 307.8 | 307.7 |
Advertising | 76.6 | (1.0) | 75.6 | 86.9 |
Printing | 20.2 | (0.2) | 20.0 | 23.1 |
Other | 29.5 | – | 29.5 | 30.9 |
Digital | 127.4 | (0.3) | 127.1 | 149.8 |
Other | 2.4 | – | 2.4 | 3.0 |
Total revenue | 568.6 | (6.2) | 562.4 | 601.4 |
(a) Exclusion of week 53
40 Subsidiaries exempt from audit
No UK subsidiaries have taken advantage of the audit exemption set out within Section 479A of the
Companies Act 2006 for the year ending 31 December 2023.
No dormant subsidiaries have taken the exemption from preparing individual financial statements
by virtue of Section 394A of the Companies Act 2006.
No dormant subsidiaries have taken the exemption from filing with the registrar individual financial
statements by virtue of Section 448A of the Companies Act 2006.
187
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Strategic Report Governance Financial Statements Other Information
Reach plc AAnnnnuuaall RReeppoorrtt 22002233 188
Parent company balance sheet
at 31 December 2023 (at 25 December 2022) Company registration number 82548
notes
2023
£m
2022
£m
Non-current assets
Investments
4
541.1
708.2
Right-of-use assets
5
4.4
5.4
Deferred tax assets
6
0.1
0.2
545.6
713.8
Current assets
Debtors – amounts falling due within one year
7
39.2
55.6
Cash at bank and in hand
15.3
20.6
54.5
76.2
Creditors: amounts falling due within one year
Lease liabilities
8
(2.3)
(2.2)
Borrowings
9
(30.0)
(15.0)
Other creditors
10
(0.7)
(8.2)
(33.0)
(25.4)
Net current assets
21.5
50.8
Total assets less current liabilities
567.1
764.6
Creditors: amounts falling due after more than one year
Lease liabilities
8
(8.5)
(10.8)
(8.5)
(10.8)
Net assets
558.6
753.8
notes
2023
£m
2022
£m
Equity capital and reserves
Called up share capital
11
32.2
32.2
Share premium account
12
–
605.4
Merger reserve
13
–
–
Capital redemption reserve
13
4.4
4.4
Retained earnings
13
522.0
111.8
Total shareholders’ funds
558.6
753.8
The Company reported a loss for the period of £173.4m (2022: loss of £68.8m). As permitted by
section 408 of the Companies Act 2006, the Company has elected not to present its own income
statement for the period.
These parent company financial statements on pages 188 to 204 were approved by the Board of
directors and authorised for issue on 5 March 2024.
They were signed on its behalf by:
Jim Mullen
Darren Fisher
Chief Executive Officer
Chief Financial Officer
188
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc AAnnnnuuaall RReeppoorrtt 22002233 188
Parent company balance sheet
at 31 December 2023 (at 25 December 2022) Company registration number 82548
notes
2023
£m
2022
£m
Non-current assets
Investments
4
541.1
708.2
Right-of-use assets
5
4.4
5.4
Deferred tax assets
6
0.1
0.2
545.6
713.8
Current assets
Debtors – amounts falling due within one year
7
39.2
55.6
Cash at bank and in hand
15.3
20.6
54.5
76.2
Creditors: amounts falling due within one year
Lease liabilities
8
(2.3)
(2.2)
Borrowings
9
(30.0)
(15.0)
Other creditors
10
(0.7)
(8.2)
(33.0)
(25.4)
Net current assets
21.5
50.8
Total assets less current liabilities
567.1
764.6
Creditors: amounts falling due after more than one year
Lease liabilities
8
(8.5)
(10.8)
(8.5)
(10.8)
Net assets
558.6
753.8
notes
2023
£m
2022
£m
Equity capital and reserves
Called up share capital
11
32.2
32.2
Share premium account
12
–
605.4
Merger reserve
13
–
–
Capital redemption reserve
13
4.4
4.4
Retained earnings
13
522.0
111.8
Total shareholders’ funds
558.6
753.8
The Company reported a loss for the period of £173.4m (2022: loss of £68.8m). As permitted by
section 408 of the Companies Act 2006, the Company has elected not to present its own income
statement for the period.
These parent company financial statements on pages 188 to 204 were approved by the Board of
directors and authorised for issue on 5 March 2024.
They were signed on its behalf by:
Jim Mullen
Darren Fisher
Chief Executive Officer
Chief Financial Officer
Reach plc AAnnnnuuaall RReeppoorrtt 22002233 189
Parent company statement of changes in equity
for the 53 weeks ended 31 December 2023 (52 weeks ended 25 December 2022)
Called up
share capital
£m
Share
premium
account
£m
Merger
reserve
£m
Capital
redemption
reserve
£m
Retained
earnings
£m
Total
£m
At 27 December 2021
32.2
605.4
25.3
4.4
177.4
844.7
Loss for the period
–
–
(25.3)
–
(43.5)
(68.8)
Purchase of shares
–
–
–
–
(1.0)
(1.0)
Credit to equity for equity-settled share-based payments
–
–
–
–
1.8
1.8
Dividends paid
–
–
–
–
(22.9)
(22.9)
At 25 December 2022
32.2
605.4
–
4.4
111.8
753.8
Loss for the period
–
–
–
–
(173.4)
(173.4)
Credit to equity for equity-settled share-based payments
–
–
–
–
1.3
1.3
Dividends paid
–
–
–
–
(23.1)
(23.1)
Capital reduction
–
(605.4)
–
–
605.4
–
At 31 December 2023
32.2
–
–
4.4
522.0
558.6
189
Reach plc Annual Report 2023
Strategic Report Governance Financial Statements Other Information
Reach plc AAnnnnuuaall RReeppoorrtt 22002233 190
Notes to the parent company financial statements
1 Basis of preparation
The financial statements of Reach plc have been prepared in accordance with Financial Reporting
Standard 101, ‘Reduced Disclosure Framework’ (FRS 101). The financial statements have been
prepared under the historical cost convention and in accordance with the Companies Act 2006
as applicable to companies using FRS 101. The preparation of financial statements in conformity
with FRS 101 requires the use of certain key accounting estimates. It also requires management to
exercise its judgement in the process of applying the Company’s accounting policies.
These parent company financial statements have been prepared on a going concern basis as set
out in note 3 in the notes to the consolidated financial statements.
The presentational and functional currency of the Company is Sterling.
For administrative convenience, the parent company financial statements are made up to a
suitable date near the end of the calendar year. These parent company financial statements have
been prepared for the 53 weeks ended 31 December 2023 and the comparative period has been
prepared for the 52 weeks ended 25 December 2022.
As permitted by FRS 101, the Company has taken advantage of the disclosure exemptions available
under that standard in relation to financial instruments, presentation of a cash flow statement,
related party transactions, and share-based payments. Where required, equivalent disclosures
are given in the consolidated financial statements.
Reach plc is the parent company of Reach (the Group) and its principal activity is to act as the
ultimate holding company of the Group.
Loss for the financial period
The Company reported a loss for the period of £173.4m (2022: loss of £68.8m). At the reporting date
an impairment review was undertaken which indicated that an impairment charge of £167.8m
(2022: £65.1m) in the investments held by the Company was required (note 4). The audit fees
relating to the Company are disclosed in note 6 in the notes to the consolidated financial
statements and are borne by another Group company. Fees payable to PricewaterhouseCoopers
LLP for non-audit services to the Company are not required to be disclosed because the
consolidated financial statements are required to disclose such fees on a consolidated basis.
Impact of amendments to accounting standards
The accounting policies used in the preparation of the parent company financial statements have
been consistently applied to all the periods presented.
190
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Strategic Report Governance Financial Statements Other Information
Reach plc AAnnnnuuaall RReeppoorrtt 22002233 190
Notes to the parent company financial statements
1 Basis of preparation
The financial statements of Reach plc have been prepared in accordance with Financial Reporting
Standard 101, ‘Reduced Disclosure Framework’ (FRS 101). The financial statements have been
prepared under the historical cost convention and in accordance with the Companies Act 2006
as applicable to companies using FRS 101. The preparation of financial statements in conformity
with FRS 101 requires the use of certain key accounting estimates. It also requires management to
exercise its judgement in the process of applying the Company’s accounting policies.
These parent company financial statements have been prepared on a going concern basis as set
out in note 3 in the notes to the consolidated financial statements.
The presentational and functional currency of the Company is Sterling.
For administrative convenience, the parent company financial statements are made up to a
suitable date near the end of the calendar year. These parent company financial statements have
been prepared for the 53 weeks ended 31 December 2023 and the comparative period has been
prepared for the 52 weeks ended 25 December 2022.
As permitted by FRS 101, the Company has taken advantage of the disclosure exemptions available
under that standard in relation to financial instruments, presentation of a cash flow statement,
related party transactions, and share-based payments. Where required, equivalent disclosures
are given in the consolidated financial statements.
Reach plc is the parent company of Reach (the Group) and its principal activity is to act as the
ultimate holding company of the Group.
Loss for the financial period
The Company reported a loss for the period of £173.4m (2022: loss of £68.8m). At the reporting date
an impairment review was undertaken which indicated that an impairment charge of £167.8m
(2022: £65.1m) in the investments held by the Company was required (note 4). The audit fees
relating to the Company are disclosed in note 6 in the notes to the consolidated financial
statements and are borne by another Group company. Fees payable to PricewaterhouseCoopers
LLP for non-audit services to the Company are not required to be disclosed because the
consolidated financial statements are required to disclose such fees on a consolidated basis.
Impact of amendments to accounting standards
The accounting policies used in the preparation of the parent company financial statements have
been consistently applied to all the periods presented.
Reach plc Annual Report 2023 191
Notes to the parent company financial statements continued
1 Basis of preparation continued
Impact of amendments to accounting standards continued
The following new standards and interpretations are effective for the 53 weeks ended
31 December 2023, but have not had a material impact on the Company:
• Property, Plant and Equipment: Proceeds before Intended Use – Amendments
to IAS 16;
• Onerous Contracts – Cost of Fulfilling a Contract – Amendments to IAS 37;
• Annual Improvements to IFRS Standards 2018-2020; and
• Reference to the Conceptual Framework – Amendments to IFRS 3.
No standards and interpretations have been early adopted.
The Company has applied the exemption available under FRS 101 in relation to paragraphs 30 and
31 of IAS 8 ‘Accounting Policies, Changes in Accounting Estimates and Errors’ (requirement for the
disclosure of information when an entity has not applied a new IFRS that has been issued and is
not yet effective).
2 Significant accounting policies
The principal accounting policies adopted in preparation of these parent company financial
statements are set out below:
Fixed asset investments
Fixed asset investments are stated at cost, less provision for any impairment. An impairment
review is undertaken at each reporting date or more frequently when there is an indication that
the recoverable amount is less than the carrying amount. Recoverable amount is the higher of fair
value less costs to sell and value-in-use. In assessing value-in-use the estimated future cash flows
of the cash-generating units relating to the investment are discounted to their present value using
a post-tax discount rate that reflects current market assessments of the time value of money and
risks specific to the asset for which estimates of future cash flows have not been adjusted. Use of
a post-tax discount rate to discount the future post-tax cash flows is materially equivalent to using
a pre-tax discount rate to discount the future pre-tax cash flows. The impairment conclusion
remains the same on a pre or post-tax basis. If the recoverable amount of the cash-generating
unit relating to the investment is estimated to be less than its carrying amount, the carrying value
of the investment is reduced to its recoverable amount. An impairment loss is recognised in the
income statement in the period in which it occurs and may be reversed in subsequent periods.
Foreign currency
Transactions denominated in foreign currencies are translated at the rates of exchange prevailing
on the date of the transactions. At each reporting date, items denominated in foreign currencies
are retranslated at the rates prevailing on the reporting date. Exchange differences arising on
settlement and on retranslation are included in the income statement for the period.
Tax
The tax expense represents the sum of the corporation tax currently payable and deferred tax.
The corporation tax currently payable is based on taxable profit for the period. Taxable profit differs
from profit before tax as reported in the income statement because it excludes items of income or
expense that are taxable or deductible in other years and it further excludes items that are never
taxable or deductible. The Company’s liability for tax is calculated using tax rates that have been
enacted or substantively enacted by the reporting date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying
amounts of assets and liabilities in the financial statements and the corresponding tax bases used
in the computation of taxable profit and is accounted for using the balance sheet liability method.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability
is settled or the asset is realised. Deferred tax is charged or credited in the income statement
except when it relates to items charged or credited in the statement of comprehensive income or
items charged or credited directly to equity, in which case the deferred tax is also dealt with in the
statement of comprehensive income and equity respectively.
Deferred tax liabilities are generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is probable that taxable profits will be
available against which deductible temporary differences can be utilised. Deferred tax liabilities
are recognised for taxable temporary differences arising on investments in subsidiaries and
associates, except where the Company is able to control the reversal of the temporary
difference and it is probable that the temporary difference will not reverse in the foreseeable
future. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced
to the extent that it is no longer probable that sufficient taxable profits will be available to allow all
or part of the asset to be recovered.
Financial instruments
Financial assets and financial liabilities are recognised in the parent company balance sheet
when the Company becomes a party to the contractual provisions of the instrument.
Financial assets
Financial assets are measured at amortised cost. The principal financial asset is intercompany
receivables which are unsecured and repayable on demand. The measurement of expected
credit losses is a function of the probability of default, loss given default (i.e. the magnitude of
the loss if there is a default) and the exposure at default.
191
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 192
Notes to the parent company financial statements continued
2 Significant accounting policies continued
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand and short-term bank deposits with an original
maturity of one week or less.
Share-based payments
The Company issues equity-settled benefits to certain employees. These equity-settled share-
based payments are measured at fair value at the date of grant taking advice from third-party
experts. The fair value determined at the grant date is expensed on a straight-line basis over the
vesting period, based on the Company’s estimate of shares that will eventually vest and be
adjusted for the effect of non-market-based vesting conditions.
Fair value is measured by use of a stochastic (Monte-Carlo binomial) model. The expected life
used in the model has been adjusted, based on the directors’ best estimates, for the effects of
non-transferability, exercise restrictions and behavioural considerations.
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction from the proceeds, net of tax.
Where the Company’s own shares are purchased, the consideration paid including any directly
attributable incremental costs, net of income taxes, is deducted from equity attributable to the
Company’s equity holders until the shares are cancelled, reissued or disposed of. Where such
shares are cancelled, the nominal value of shares cancelled is shown in the capital redemption
reserve. Where such shares are subsequently reissued or disposed of, any consideration received,
net of any directly attributable incremental transaction costs and the related income tax effects,
is included in equity attributable to the Company’s equity holders.
Leases
Leases are recognised on the balance sheet as a right-of-use asset and corresponding liability at
the date at which a leased asset is made available for use by the Company, except for short-term
leases (defined as leases with a lease term of 12 months or less) and leases of low-value assets.
For these leases, the Company recognises the lease payments as an operating expense on a
straight-line basis over the term of the lease.
The lease liability is initially measured at the present value of the lease payments that are not paid
at the commencement date, discounted by using the Group’s weighted average incremental
borrowing rate and subsequently held at amortised cost in accordance with IFRS 9. Finance costs
are charged to the income statement over the lease term, at a constant periodic rate of interest.
Right-of-use assets are depreciated over the lease term on a straight-line basis. Each lease
payment is allocated between the liability and finance cost. The Company does not act as
a lessor.
Key sources of estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty that
have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below:
Impairment of investments (note 4)
There is uncertainty in the value-in-use calculation. The most significant area of uncertainty
relates to expected future cash flows (including future pension contributions) of the cash-
generating unit relating to the investment. The value-in-use calculation requires the Company to
estimate the future cash flows expected to arise and a suitable discount rate in order to calculate
present value. Projections are based on both internal and external market information and reflect
past experience. The discount rate reflects the cost of equity.
3 Staff costs
The average monthly number of persons, including directors, employed by and charged to the
Company in the period was:
2023
Number
2022
Number
Administration
9
9
The costs of a number of employees (not directors) who have contracts of employment with the
Company are charged to other Group companies and their staff costs are disclosed in those
companies’ statutory financial statements.
192
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Reach plc Annual Report 2023 192
Notes to the parent company financial statements continued
2 Significant accounting policies continued
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand and short-term bank deposits with an original
maturity of one week or less.
Share-based payments
The Company issues equity-settled benefits to certain employees. These equity-settled share-
based payments are measured at fair value at the date of grant taking advice from third-party
experts. The fair value determined at the grant date is expensed on a straight-line basis over the
vesting period, based on the Company’s estimate of shares that will eventually vest and be
adjusted for the effect of non-market-based vesting conditions.
Fair value is measured by use of a stochastic (Monte-Carlo binomial) model. The expected life
used in the model has been adjusted, based on the directors’ best estimates, for the effects of
non-transferability, exercise restrictions and behavioural considerations.
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction from the proceeds, net of tax.
Where the Company’s own shares are purchased, the consideration paid including any directly
attributable incremental costs, net of income taxes, is deducted from equity attributable to the
Company’s equity holders until the shares are cancelled, reissued or disposed of. Where such
shares are cancelled, the nominal value of shares cancelled is shown in the capital redemption
reserve. Where such shares are subsequently reissued or disposed of, any consideration received,
net of any directly attributable incremental transaction costs and the related income tax effects,
is included in equity attributable to the Company’s equity holders.
Leases
Leases are recognised on the balance sheet as a right-of-use asset and corresponding liability at
the date at which a leased asset is made available for use by the Company, except for short-term
leases (defined as leases with a lease term of 12 months or less) and leases of low-value assets.
For these leases, the Company recognises the lease payments as an operating expense on a
straight-line basis over the term of the lease.
The lease liability is initially measured at the present value of the lease payments that are not paid
at the commencement date, discounted by using the Group’s weighted average incremental
borrowing rate and subsequently held at amortised cost in accordance with IFRS 9. Finance costs
are charged to the income statement over the lease term, at a constant periodic rate of interest.
Right-of-use assets are depreciated over the lease term on a straight-line basis. Each lease
payment is allocated between the liability and finance cost. The Company does not act as
a lessor.
Key sources of estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty that
have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below:
Impairment of investments (note 4)
There is uncertainty in the value-in-use calculation. The most significant area of uncertainty
relates to expected future cash flows (including future pension contributions) of the cash-
generating unit relating to the investment. The value-in-use calculation requires the Company to
estimate the future cash flows expected to arise and a suitable discount rate in order to calculate
present value. Projections are based on both internal and external market information and reflect
past experience. The discount rate reflects the cost of equity.
3 Staff costs
The average monthly number of persons, including directors, employed by and charged to the
Company in the period was:
2023
Number
2022
Number
Administration
9
9
The costs of a number of employees (not directors) who have contracts of employment with the
Company are charged to other Group companies and their staff costs are disclosed in those
companies’ statutory financial statements.
Reach plc Annual Report 2023 193
Notes to the parent company financial statements continued
3 Staff costs continued
All employees are employed in the UK.
2023
£m
2022
£m
Staff costs, including directors’ emoluments, incurred during the
period were:
Wages and salaries
1.6
1.5
Social security costs
0.4
0.4
Share-based payments charge
0.6
1.5
Pension costs relating to defined contribution pension schemes
0.1
0.1
2.7
3.5
Disclosure of individual directors’ remuneration, share options, long-term incentive schemes,
pension contributions and pension entitlements required by the Companies Act 2006 and those
elements specified for audit by the Financial Conduct Authority are shown in the tables in the
Remuneration Report on pages 104 to 126 and form part of these parent company financial
statements. Further details of share-based payments are contained in note 32 in the notes
to the consolidated financial statements.
4 Investments
Shares in
subsidiary
undertakings
£m
Cost
At 27 December 2021
1,526.5
At 25 December 2022
1,526.5
Additions
0.7
At 31 December 2023
1,527.2
Provision for impairment
At 27 December 2021
(753.2)
Impairment in the period
(65.1)
At 25 December 2022
(818.3)
Impairment in the period
(167.8)
At 31 December 2023
(986.1)
Net book value
At 25 December 2022
708.2
At 31 December 2023
541.1
At the period end reporting date an impairment review was undertaken which indicated that
an impairment charge of £167.8m in the investments held by the Company was required
(2022: £65.1m). The impairment review was performed using the same projections used in the
impairment review performed in relation to the Group’s goodwill and other intangible assets
which is disclosed in note 16 in the notes to the consolidated financial statements. In respect of
investments the current post-tax and equivalent pre-tax discount rate used is 11.8% (2022: 11.7%)
and 15.2% (2022: 15.3%) respectively and the long-term growth rate beyond the 10-year period is
0.9% (2022: 1.0%).
193
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 194
Notes to the parent company financial statements continued
4 Investments continued
The impairment review in respect of the investments held by the Company is highly sensitive to
reasonably possible changes in key assumptions used in the value-in-use calculations. EBITDA in
the 10-year projections is forecast to grow at a CAGR of 0.2% (2022 1.6%). Changes in one or more
assumptions used to develop the EBITDA growth assumption such as print revenue declining at a
faster rate than projected, digital revenue growth being significantly lower than projected or the
associated change in the cost base being different than projected, could lead to a reasonably
possible change in EBITDA growth. These changes would lead to a further impairment in the
investments held by the Company. A decrease of 1% in EBITDA each year in the 10-year projections
would result in an increase in the impairment charge by £8.2m (CAGR: 0.1%). Alternatively, an
increase in the discount rate by 0.1% would lead to an increase in the impairment charge of £6.2m.
Details of the Company’s subsidiary undertakings at 31 December 2023 are set out on pages 197
to 204.
5 Right-of-use assets
Properties
£m
Cost
At 27 December 2021
16.1
At 25 December 2022
16.1
At 31 December 2023
16.1
Accumulated depreciation and impairment
At 27 December 2021
(9.7)
Charge for the period
(1.0)
At 25 December 2022
(10.7)
Charge for the period
(1.0)
At 31 December 2023
(11.7)
Carrying amount
At 25 December 2022
5.4
At 31 December 2023
4.4
6 Deferred tax assets
Other short-
term timing
£m
At 27 December 2021
0.8
Charge to income statement
(0.6)
At 25 December 2022
0.2
Charge to income statement
(0.1)
At 31 December 2023
0.1
7 Debtors: amounts falling due within one year
2023
£m
2022
£m
Amounts falling due within one year:
Amounts owed by subsidiary undertakings
38.4
54.5
Other debtors
0.8
1.1
39.2
55.6
The amounts owed by subsidiary undertakings are unsecured, interest free and repayable
on demand.
194
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Reach plc Annual Report 2023 194
Notes to the parent company financial statements continued
4 Investments continued
The impairment review in respect of the investments held by the Company is highly sensitive to
reasonably possible changes in key assumptions used in the value-in-use calculations. EBITDA in
the 10-year projections is forecast to grow at a CAGR of 0.2% (2022 1.6%). Changes in one or more
assumptions used to develop the EBITDA growth assumption such as print revenue declining at a
faster rate than projected, digital revenue growth being significantly lower than projected or the
associated change in the cost base being different than projected, could lead to a reasonably
possible change in EBITDA growth. These changes would lead to a further impairment in the
investments held by the Company. A decrease of 1% in EBITDA each year in the 10-year projections
would result in an increase in the impairment charge by £8.2m (CAGR: 0.1%). Alternatively, an
increase in the discount rate by 0.1% would lead to an increase in the impairment charge of £6.2m.
Details of the Company’s subsidiary undertakings at 31 December 2023 are set out on pages 197
to 204.
5 Right-of-use assets
Properties
£m
Cost
At 27 December 2021
16.1
At 25 December 2022
16.1
At 31 December 2023
16.1
Accumulated depreciation and impairment
At 27 December 2021
(9.7)
Charge for the period
(1.0)
At 25 December 2022
(10.7)
Charge for the period
(1.0)
At 31 December 2023
(11.7)
Carrying amount
At 25 December 2022
5.4
At 31 December 2023
4.4
6 Deferred tax assets
Other short-
term timing
£m
At 27 December 2021
0.8
Charge to income statement
(0.6)
At 25 December 2022
0.2
Charge to income statement
(0.1)
At 31 December 2023
0.1
7 Debtors: amounts falling due within one year
2023
£m
2022
£m
Amounts falling due within one year:
Amounts owed by subsidiary undertakings
38.4
54.5
Other debtors
0.8
1.1
39.2
55.6
The amounts owed by subsidiary undertakings are unsecured, interest free and repayable
on demand.
Reach plc Annual Report 2023 195
Notes to the parent company financial statements continued
8 Lease liabilities
Total
£m
At 27 December 2021
(14.5)
Interest costs
(0.5)
Payments
2.0
At 25 December 2022
(13.0)
Interest costs
(0.4)
Payments
2.6
At 31 December 2023
(10.8)
Of the lease liability, £2.3m (2022: £2.2m) is included in creditors: amounts falling due within one
year and £8.5m (2022: £10.8m) is included in creditors: amounts falling due after more than
one year.
Total undiscounted future payments amounting to £11.5m are payable £2.6m for 2024 and £2.6m
per year for 2025 to 2027 with a total of £1.1m payable in 2028.
9 Borrowings
The details of the Company’s borrowings are disclosed in note 24 in the notes to the consolidated
financial statements.
10 Other creditors
2023
£m
2022
£m
Amounts falling due within one year:
Share-based payments
(0.5)
(0.9)
Accruals
(0.2)
(0.3)
Deferred consideration
–
(7.0)
(0.7)
(8.2)
The share-based payments provision relates to National Insurance obligations attached to the
future crystallisation of awards.
Details of the deferred consideration are set out in note 24 in the notes to the consolidated
financial statements.
11 Called up share capital
The details of the Company’s called up share capital and dividends are disclosed in notes 29
and 30 respectively in the notes to the consolidated financial statements.
12 Share premium account
The details of the Company’s share premium account are disclosed in note 31 in the notes to the
consolidated financial statements.
13 Other reserves
Merger
reserve
£m
Capital
redemption
reserve
£m
Retained
earnings
£m
At 27 December 2021
25.3
4.4
177.4
Loss for the period
(25.3)
–
(43.5)
Purchase of shares
–
–
(1.0)
Share-based payments credit
–
–
1.8
Dividends paid
–
–
(22.9)
At 25 December 2022
–
4.4
111.8
Loss for the period
–
–
(173.4)
Share-based payments credit
–
–
1.3
Dividends paid
–
–
(23.1)
Capital reduction
–
–
605.4
At 31 December 2023
–
4.4
522.0
195
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Strategic Report Governance Financial Statements Other Information
Reach plc Annual Report 2023 196
Notes to the parent company financial statements continued
13 Other reserves continued
The merger reserve comprises the premium on the shares allotted in relation to acquisitions
and was reduced to nil in the prior year as a result of the impairment charge in the period, with
remainder of £39.8m reducing retained earnings. The capital redemption reserve represents the
nominal value of the shares purchased and subsequently cancelled as part of share buy-back
programmes. The retained earnings reserves are all distributable.
The reserves, which are distributable to the Company’s equity shareholders, are determined
with reference to the Companies Act 2006. Further guidance is given in the Institute of Chartered
Accountants in England and Wales technical release 02/17BL in relation to what profits can
be treated as distributable. At 31 December 2023, all the Company’s retained earnings are
distributable, however, the available amount may be different at the point any future
distributions are made.
14 Related party transactions
As permitted by FRS 101, the Company has taken advantage of the disclosure exemptions available
under that standard in relation to related party transactions. Transactions with the retirement
benefit schemes and employee benefit trusts are disclosed in notes 21 and 30 respectively in
the notes to the consolidated financial statements. Details of other related party transactions
are disclosed below.
Trading transactions
The Company did not trade with the Group’s associated undertakings.
Compensation of key management personnel
Key management are the executive directors and non-executive directors. The remuneration
of the executive directors is determined by the Remuneration Committee having regard
to competitive market position and performance of individuals. The remuneration of the
non-executive directors is determined by the Company Chairman and the executive directors.
The pension provision for the executive directors is a cash sum to use for pension purposes.
Neither of the executive directors participate in any of the Group’s defined contribution or defined
benefit pension schemes. Further information regarding the remuneration of the executive
directors and non-executive directors is provided in the Remuneration Report on pages 104 to 126.
.
196
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15 Subsidiary and associated undertakings
As at 31 December 2023
The following subsidiary undertakings are 100% owned other than where specified (all share
classes), and are incorporated in England and Wales, with a registered office at One Canada
Square, Canary Wharf, London, E14 5AP.
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
08000 Recruit Limited (3829341) £0.01 ordinary – 100
Ad-Mag (North East) Limited (3083880) £1.00 ordinary – 100
Advertiser North London Group (Holdings)
Limited (1693151)
£1.00 ordinary – 100
Advertiser North London Limited (1036821) £1.00 ordinary – 100
AMRA Limited (2191577) £1.00 ordinary – 100
Arrow Interactive Limited (3521226) £1.00 ordinary – 100
Beaverbrook Newspapers Limited (00971744) £1.00 ordinary – 100
Birmingham Live Limited (3020729) £1.00 ordinary – 100
Birmingham Post & Mail (Exhibitions) Limited
(517223)
£1.00 ordinary – 100
Blackfriars Leasing Ltd. (01692745) £1.00 ordinary – 100
Blackmore Vale Publishing Company Limited
(2151903)
£1.00 ordinary 100 –
BPM Media (Midlands) Limited (1034883) £1.00 ordinary – 100
Broughton Printers Limited (01091137) £1.00 ordinary-A
£1.00 ordinary-B
–
–
100
100
Burginhall 677 Limited (02789921) £1.00 ordinary – 100
Buy Sell Limited (2032657) £1.00 ordinary 100 –
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Camberry Limited (1661112) £1.00 ordinary – 100
Channel One Liverpool Limited (3219679)
1
£1.00 ordinary – 100
Chargestake Limited (3518494) £1.00 ordinary – 100
Charles Elphick Limited (529125) £1.00 ordinary – 100
City Television Network Limited (3376809) £1.00 ordinary – 100
Community Magazines Limited (2026564) £1.00 ordinary – 100
Conrad & Partners Limited (2415617) £1.00 ordinary – 100
Daily Express Limited (00529175) £1.00 ordinary – 100
Daily Post Investments Limited (1360376) £1.00 ordinary 100 –
Daily Post Overseas Limited (1354793) £1.00 ordinary – 100
Daily Star Limited (00980542) £1.00 ordinary – 100
Denitz Investments Limited (3775012) £1.00 ordinary – 100
£0.01 ordinary-A – 100
£0.01 ordinary-C – 100
£0.00001
ordinary-D
– 100
£0.001 ordinary-E – 100
Echo Press (1983) Limited (1679832) £1.00 ordinary – 100
Enterprise Magazines Limited (1502649) £1.00 ordinary – 100
Examiner News & Information Services Limited
(624466)
£1.00 ordinary – 100
Export Magazine Distributors Limited (02711709) £1.00 ordinary – 100
Express Newspapers (00141748) £0.25 ordinary
£0.01 deferred
–
–
100
100
1. Company entered into voluntary liquidation on 29 January 2024
Notes to the parent company financial statements continued
197
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Strategic Report Governance Financial Statements Other Information
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Express Newspapers Pension Trustees Limited
(02222373)
£1.00 ordinary – 100
Express Newspapers Properties Limited
(00967305)
£1.00 ordinary – 100
Financial Jobs Online Limited (3846941)
1
£1.00 ordinary – 100
Fish4 Limited (03105246) £1.00 ordinary-A
£1.00 ordinary-B
–
–
100
100
Fish4 Trading Limited (04280832) £1.00 ordinary – 100
Fish4Cars Limited (03955815) £1.00 ordinary – 100
Fish4Homes Limited (03943230) £0.10 ordinary
(paid)
– 100
£0.10 ordinary
(unpaid)
– 100
£0.10 ordinary
non-voting
– 39.4
Fish4Jobs Limited (03961754) £1.00 ordinary – 100
Gazette Media Company Limited (216451) £1.00 ordinary – 100
Gimmejobs Limited (4053381) £1.00 ordinary – 100
Gisajob Limited (2734099) £1.00 ordinary – 100
High Street Direct Limited (3656084) £1.00 ordinary – 100
Hot Exchange Limited (3939705) £1.00 ordinary – 100
Hotrecruit Limited (4166527) £1.00 ordinary-A – 100
Huddersfield Examiner Limited (972525) £1.00 ordinary – 100
Huddersfield Newspapers Limited (2254191) £1.00 ordinary 100 –
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
I.T. Trade Publishing Limited (3091844) £1.00 ordinary 100 –
Informer Publications Limited (2563349) £1.00 ordinary – 100
Isle of Wight Newspapers Limited (2234798) £1.00 ordinary – 100
Job Search Limited (3164594) £1.00 ordinary – 100
Jobsfinancial Limited (3845499) £1.00 ordinary – 100
Jobsin Limited (3871542) £1.00 ordinary – 100
Joseph Woodhead & Sons Limited (84100) £1.00 ordinary – 100
Just London Jobs Limited (2348940) £1.00 ordinary – 100
Kennyhill Limited (2761493) £1.00 ordinary – 100
Kent Regional Newspapers Limited (1381259) £1.00 ordinary – 100
Legionstyle Limited (1936042) £1.00 ordinary – 100
Live TV Limited (2965940) £1.00 ordinary – 100
Liverpool Web Offset Limited (797447) £1.00 ordinary 100 –
Liverpool Weekly Newspaper Group Limited
(714750)
£1.00 ordinary 100 –
Llandudno Advertiser Limited (332137) £1.00 ordinary – 100
Local World Holdings Limited (07550888)
1
£0.0001
ordinary-A
– 100
£0.0001
ordinary-B
– 100
£0.0001
ordinary-C
– 100
£0.0001
ordinary-D
– 100
1. Company entered into voluntary liquidation on 29 January 2024
Notes to the parent company financial statements continued
15 Subsidiary and associated undertakings continued
198
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Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Local World Limited (08290481) £1.00 ordinary – 100
London and Westminster Newspapers Limited
(1208670)
£1.00 ordinary – 100
London Newspaper Group Limited (2126851) £1.00 ordinary – 100
Mainjoy Limited (1970628) £1.00 ordinary – 100
Markstead Limited (3025792) £1.00 ordinary – 100
Media Wales Limited (46946) £1.00 ordinary – 100
Medpress Limited (559427) £1.00 ordinary 100 –
Meilin Limited (2166364) £1.00 ordinary – 100
MEN Media Limited (3890740) £1.00 ordinary – 100
Mercury Distribution Services Limited (885364) £1.00 ordinary – 100
Merseymart Limited (319598) £1.00 ordinary – 100
MG Estates Limited (3555219) £1.00 ordinary – 100
MG Guarantee Co Limited (6256959) – 100 –
MGL2 Limited (6234510) £1.00 ordinary – 100
MGN (86) Limited (421836) £1.00 ordinary – 100
MGN (AW) Limited (2946962) £1.00 ordinary – 100
MGN (Canada Square) Limited (02892419) £1.00 ordinary – 100
MGN Limited (2571173) £1.00 ordinary – 100
MGN Pension Trustees Limited (2658322) £1.00 ‘A’ Ordinary – 100
Micromart (UK) Limited (2122028) £1.00 ordinary 100 –
Middlesex County Press Limited (2068255) £1.00 ordinary – 100
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Midland Independent Magazines Limited
(1206379)
£1.00 ordinary – 100
Midland Independent Newspaper & Media Sales
Limited (2281540)
£1.00 ordinary 100 –
Midland Independent Weekly Newspapers
Limited (385159)
£1.00 ordinary – 100
Midland Newspapers Limited (1663033) £1.00 ordinary – 100
Midland Newspapers Pension Trustees Limited
(2228647)
£1.00 ordinary 100 –
Midland Newspapers Printers Limited (2552554) £1.00 ordinary – 100
Midland United Newspapers Limited (2212019) £1.00 ordinary – 100
Midland Weekly Media (Birmingham) Limited
(105934)
£1.00 ordinary 100 –
Midland Weekly Media (Wolverhampton) Limited
(1119011)
£1.00 ordinary 100 –
Midland Weekly Media Limited (3103975) £1.00 ordinary – 100
Mirror Colour Print (London) Limited (1678318)
1
£1.00 ordinary – 100
Mirror Colour Print (North) Limited (537916)
1
£1.00 ordinary – 100
Mirror Colour Print Services (London) Limited
(1969510)
1
£1.00 ordinary – 100
Mirror Colour Print Services Limited (935731)
1
£1.00 ordinary – 100
Mirror Financial Services Limited (3804460) £1.00 ordinary – 100
Mirror Group Music Limited (3087502) £1.00 ordinary – 100
Mirror Group Newspapers Limited (2542560) £1.00 ordinary – 100
Mirror Group Newspapers North (1986)
Limited (1348163)
£1.00 ordinary – 100
1. Company entered into voluntary liquidation on 29 January 2024
Notes to the parent company financial statements continued
15 Subsidiary and associated undertakings continued
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Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Mirror Projects Limited (2822578) £1.00 ordinary – 100
MirrorAd Limited (3573736) £1.00 ordinary – 100
Mirrorair Limited (1376321) £1.00 ordinary – 100
Mirrorgroup Limited (7680699) £1.00 ordinary – 100
MirrorNews Limited (3573742) £1.00 ordinary – 100
MirrorTel Limited (2820338) £1.00 ordinary – 100
NCJ Media Limited (204478) £1.00 ordinary – 100
Net Recruit UK Limited (4153006) £1.00 ordinary – 100
North Eastern Evening Gazette Limited (3441979) £1.00 ordinary – 100
North Wales Independent Press Limited
(1958646)
£1.00 ordinary 100 –
North Wales Weekly News (486584) £1.00 ordinary – 100
Nunews Limited (2858756) £1.00 ordinary – 100
O K Magazines Trading Co Limited (02812158) £1.00 ordinary – 100
O.K. Magazines Limited (02768369) £1.00 ordinary – 100
Odhams Newspapers Limited (2179889) £1.00 ordinary – 100
Official Starting Prices Ltd. (2477911) £1.00 ordinary – 100
Planetrecruit Limited (3712451) £1.00 ordinary – 100
Quids-In (North West) Limited (2667020) £1.00 ordinary 100 –
R.E. Jones & Bros. Limited (707920) £1.00 ordinary – 100
R.E. Jones Graphic Services Limited (1198462) £1.00 ordinary – 100
R.E. Jones Newspaper Group Limited (1238072) £1.00 ordinary – 100
Reach Directors Limited (4331538) £1.00 ordinary 100 –
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Reach Group Holdings Limited (14613070) £1.00 ordinary - 100
Reach Magazines Distribution Limited
(02794459)
£1.00 ordinary – 100
Reach Magazines Limited (03009449) £1.00 ordinary – 100
Reach Magazines Publishing Limited (01633971) £1.00 ordinary – 100
Reach Magazines Worldwide Limited (06395556) £1.00 ordinary – 100
Reach Media Group Ltd (11051310) £1.00 ordinary – 100
Reach Midlands Media Limited (5286985) £1.00 ordinary – 100
Reach Nationals Limited (04386569)
1
£1.00 ordinary – 100
Reach Network Media Limited (4086475) £1.00 ordinary – 100
Reach Pension Trustees Ireland Limited (13812160) £1.00 ordinary – 100
Reach Pension Trustees Limited (4705180) £1.00 ordinary 100 –
Reach Printing Services (Midlands) Limited
(211184)
£1.00 ordinary – 100
Reach Printing Services (Oldham) Limited
(2177980)
£1.00 ordinary – 100
Reach Printing Services (Teesside) Limited
(5286989)
£1.00 ordinary – 100
Reach Printing Services (Watford) Limited
(2064914)
£1.00 ordinary – 100
Reach Printing Services (West Ferry) Limited
(01997219)
£1.00 ordinary – 100
Reach Printing Services Limited (1979335) £1.00 ordinary – 100
Reach Publishing Group Limited (3890730) £1.00 ordinary 100 –
Reach Publishing Services Limited (08339522) £1.00 ordinary – 100
1. Company entered into voluntary liquidation on 29 January 2024
Notes to the parent company financial statements continued
15 Subsidiary and associated undertakings continued
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Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Reach Regionals Limited (3890736) £1.00 ordinary – 100
Reach Regionals Media Limited (127699) £1.00 ordinary – 100
Reach Secretaries Limited (4333688) £1.00 ordinary 100 –
Reach Shared Services Limited (3890737) £1.00 ordinary 100 –
Reach Southern Media Limited (1985909) £1.00 ordinary – 100
Reach Work Limited (1904765) £1.00 ordinary – 100
Reliant Distributors Limited (1225496) £1.00 ordinary – 100
RH1 Limited (648191) £1.00 ordinary – 100
Scene Magazines Limited (1381396) £1.00 ordinary – 100
Scene Newspapers Limited (1108815) £1.00 ordinary – 100
Scene Printing (Midlands) Limited (1391392) £1.00 ordinary – 100
Scene Printing Web Offset Limited (1206696) £1.00 ordinary – 100
Sightline Publications Limited (01510224) £1.00 ordinary – 100
Sunday Express Limited (00184146) £0.05 ordinary – 100
Sunday People Limited (301999) £1.00 ordinary – 100
Syndication International (1986) Limited
(448509)
£1.00 ordinary – 100
Syndication International Limited (850258) £1.00 ordinary – 100
T M S Pension Trustee Limited (4522021) £1.00 ordinary – 100
The Adscene Group Limited (1131297) £0.05 ordinary
£1.00 7.8% Series 2
Cumulative
Convertible
Redeemable
Preference
–
–
100
100
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Associated Catholic Newspapers (1912) Limited
(The) (120837)
£0.10 ordinary 100 –
Birmingham Boat Shows Limited (The) (697854) £1.00 ordinary – 100
The Birmingham Post & Mail Limited (3141237) £1.00 ordinary – 100
The Career Engineer Limited (4138919)
1
£1.00 ordinary – 100
Chester Chronicle and Associated Newspapers
Limited(The) (222859)
£1.00 ordinary – 100
The Daily Mirror Newspapers Limited (166810) £1.00 ordinary – 100
The Echo Press Limited (171206) £1.00 ordinary – 100
The Graduate Group Ltd (3730922) £0.01 ordinary – 100
The Green Magazine Company Limited
(02403686)
£1.00 ordinary – 100
The Hinckley Times Limited (47310) £1.00 ordinary – 100
The Hotgroup Limited (3236337) £0.10 ordinary – 100
This Is Britain Limited (03268034) £0.10 ordinary – 100
TIH (Belfast) (Nominees) Limited (3909863)
1
£1.00 ordinary – 100
TIH (Cardiff) Limited (3026546) £1.00 ordinary
£0.683
ordinary-A
–
–
100
100
TIH (Chester) Limited (3026545) £1.00 ordinary
£0.683
ordinary-A
–
–
100
100
TIH (Newcastle) Limited (3036379) £1.00 ordinary
£0.683
ordinary-A
–
–
100
100
1. Company entered into voluntary liquidation on 29 January 2024
Notes to the parent company financial statements continued
15 Subsidiary and associated undertakings continued
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Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
TIH (Properties) Limited (553965) £1.00 ordinary 100 –
TIH (Teesside) Limited (3036380) £1.00 ordinary
£0.683
ordinary-A
–
–
100
100
TIH (Trustee) Limited (3469055) £1.00 ordinary 100 –
TM Leasing Limited (06391524) £1.00 ordinary – 100
TM Media Holdings Limited (04104523) £1.00 ordinary – 100
TM Mobile Solutions Limited (10292426) £0.01 ordinary – 100
TM North America Limited (05320973) £1.00 ordinary-A
£1.00 ordinary-B
–
–
100
100
TM Regional New Media Limited (3890734) £1.00 ordinary 100 –
TM Titles Limited (02827197) £1.00 ordinary – 100
Totallyfinancial.com Ltd (3823143) £1.00 ordinary – 100
Totallylegal.com Limited (3823137) £1.00 ordinary – 100
Tower Magazines Limited (02528573) £1.00 ordinary – 100
Trinity 100 Limited (3441980) £1.00 ordinary – 100
Trinity Mirror (L I) Limited (5317967) £1.00 ordinary – 100
Trinity Mirror Acquisitions Limited (5534393) £1.00 ordinary – 100
Trinity Mirror Cheshire Limited (3890747) £1.00 ordinary – 100
Trinity Mirror Digital Limited (4089434) £1.00 ordinary 100 –
Trinity Mirror Digital Media Limited (3906084) £1.00 ordinary 100 –
Trinity Mirror Distributors Limited (4968805) £1.00 ordinary – 100
Trinity Mirror Finance Limited (04315964) £1.00 ordinary – 100
Trinity Mirror Huddersfield Limited (5286931) £1.00 ordinary – 100
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Trinity Mirror Media Limited (04106172) £1.00 ordinary – 100
Trinity Mirror Merseyside Limited (3890743) £1.00 ordinary – 100
Trinity Mirror North Wales Limited (3890745) £1.00 ordinary – 100
Trinity Mirror Printing (Cardiff) Limited (5286933) £1.00 ordinary – 100
Trinity Mirror Printing (Liverpool) Limited
(5286986)
£1.00 ordinary – 100
Trinity Mirror Printing (Newcastle) Limited
(5286987)
£1.00 ordinary – 100
Trinity Mirror Videos Limited (02729730) £1.00 ordinary – 100
Trinity Newspaper Group Limited (919233) £1.00 ordinary 100 –
Trinity Newspapers Southern Limited (1491074) £1.00 ordinary – 100
Trinity Publications Limited (1953315) £1.00 ordinary 55.238 44.762
Trinity Retirement Benefit Scheme Limited
(714710)
Limited by
guarantee
– –
Trinity Shared Services Limited (827234) £1.00 ordinary – 100
Trinity Weekly Newspapers Limited (13297) £1.00 ordinary 100 –
United Magazines Publishing Services Limited
(01693996)
£1.00 ordinary – 100
Vivid Group Limited (143647)
1
£1.00 ordinary 100 –
Wandsworth Independent Limited (2152840) £1.00 ordinary – 100
Welsh Universal Holdings Limited (976111) £1.00 ordinary – 100
Welshpool Web-Offset Co. Limited (1071324) £1.00 ordinary – 100
West Ferry Leasing Limited (04086472) £1.00 ordinary – 100
West Ferry Printers Pension Scheme Trustees
Limited (08984753)
£1.00 ordinary – 100
1. Company entered into voluntary liquidation on 29 January 2024
Notes to the parent company financial statements continued
15 Subsidiary and associated undertakings continued
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Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Western Mail & Echo Limited (326067) £1.00 ordinary – 100
Whitbread Walker Limited (2535880) £1.00 ordinary – 100
Wirral Newspapers Limited (152425) £1.00 ordinary 100 –
Wood Lane One Limited (4318355) £1.00 ordinary 100 –
Wood Lane Two Limited (4318345) £1.00 ordinary 100 –
Workthing Limited (3873867) £0.10 ordinary
£0.10 ordinary-A
£0.10 ordinary-B
£1.00 Cumulative
Redeemable
Preference
Shares at 9.25%
–
–
–
–
100
100
100
100
The following subsidiary undertakings are 100% owned (all share classes), and incorporated in
Scotland, with a registered office at 55 Douglas Street, Glasgow, G2 7NP.
Subsidiary name and company number Share class
Proportion of
shares held
by the Company
(%)
Proportion of
shares held by
subsidiary
(%)
Anderston Quay Printers Limited (SC097571)
1
£1.00 ordinary - 100
First Press Publishing Limited (SC139798) £1.00 ordinary - 100
Glaswegian Publications Limited (SC109893) £1.00 ordinary - 100
Insider Publications Limited (SC094795) £1.00 ordinary - 100
Media Scotland Limited (SC097566) £1.00 ordinary - 100
Metropolitan Free Newspapers Limited
(SC126368)
£1.00 ordinary - 100
Northern Print Services Limited (SC092400) £1.00 ordinary - 100
Reach Printing Services (Saltire) Limited
(SC276920)
£1.00 ordinary - 100
Saltire Press Limited (SC151303) £1.00 ordinary - 100
Scottish and Universal Newspapers Limited
(SC005761)
£1.00 ordinary - 100
Scottish Daily Record and Sunday Mail Limited
(SC012921)
£1.00 ordinary - 100
Scottish Express Newspapers Limited
(SC020889)
£1.00 ordinary - 100
The Edinburgh and Lothians Post Limited
(SC122538)
£1.00 ordinary - 100
Trinity Mirror Printing (Blantyre) Limited
(SC276879)
£1.00 ordinary - 100
1. Company entered into voluntary liquidation on 29 January 2024
Notes to the parent company financial statements continued
15 Subsidiary and associated undertakings continued
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The following subsidiary undertaking is 100% owned (all share classes), and incorporated in
Northern Ireland, with a registered office at 415 Holywood Road, Belfast BT4 2GU.
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Trinity Mirror Limited (NI650694) £1.00 ordinary 100 –
Associated undertakings
The following associated undertakings are incorporated in England and Wales.
Name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Registered office
address
Ozone Project Limited
(11471303)
£0.0001
ordinary-D
£0.0001
preference
–
–
21%
4%
New City Court, 20
St. Thomas Street,
London, SE1 9RS
PA Media Group Limited
(00004197)
£1.00 ordinary 2.7% 22.8% The Point, 37 North
Wharf Road,
Paddington,
London, W2 1AF
Brand Events
TM
Limited was an associate until 2 February 2023 when the Group disposed of 44% of
its shareholding.
Notes to the parent company financial statements continued
15 Subsidiary and associated undertakings continued
The following subsidiary undertaking is 100% owned (all share classes), and incorporated in the
United States of America, with a registered office at 101 Avenue of the Americas, Suite 934, New
York, NY 10013.
Subsidiary name and company number Share class
Proportion of
shares held by
the Company (%)
Proportion of
shares held by
subsidiary(%)
Trinity Mirror Marketing LLC (20-4489794) US$1.00 ordinary – 100
The following subsidiary undertakings are 100% owned (all share classes), and incorporated In the
United States of America, with a registered office at 112 S. French Street, Suite 105, Wilmington,
Delaware, DE 19801.
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Reach US Holdings Inc. (92-1945745) US$125.00
ordinary
– 100
Reach US OpCo LLC (92-1983200) US$125.00
ordinary
– 100
The following subsidiary undertakings are 100% owned (all share classes) and incorporated in
Ireland, with a registered office at 38 Upper Mount Street, Dublin 2.
Subsidiary name and company number Share class
Proportion of
shares held by the
Company (%)
Proportion of
shares held by
subsidiary (%)
Independent Star Limited (122550) €1.27 ordinary-E
€1.27 ordinary-I
€1.27 Preference
–
–
–
100
100
100
Reach Publishing (Ireland) Limited (646649) €1.00 ordinary – 100
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The Sustainability Accounting Standards Board (SASB) is an Environmental, Social
and Governance (ESG) voluntary guidance framework that sets standards for the
disclosure of financially material sustainability information by companies to their
investors. Available for 77 industries, the standards identify the subset of ESG issues
most relevant to financial performance in each industry. Below we report against
metrics from the Media & Entertainment standard.
2023 SASB INDEX
Sustainability Disclosure Topics and Accounting Metrics
Media pluralism
Percentage of gender and racial/ethnic
group representation for (1) management;
(2) professionals; and (3) all other employees
The percentage of racial/ethnic groups and gender representation for the Board and management can be found on page 91 in the Governance Report.
The percentage of gender representation for employees can be found on page 91 in the Governance Report. The percentage of racial/ethnic groups
for employees is not reported for 2023. We continue to gather robust ethnicity data from our teams via our Be Counted data-gathering which asks
colleagues about a range of characteristics, and in 2023 had an 86% participation rate. Analysis of this data allows us to better understand the
makeup of our teams and work to build an inclusive culture at Reach.
Description of policies and procedures for
ensuring pluralism in news media content
All our newsbrands operate with editorial independence and reflect a broad spectrum of opinion that is designed to appeal to their community of
readers and not to reflect any Group-influenced ideological position. Therefore, no single title or contributor represents Reach as a whole.
Our Company position on the issue is that we believe the media sector has a responsibility to reflect more accurately the diverse communities within
the UK, and we have embarked on a number of diversity and inclusion activities to address this.
In 2023, we refined several ways to achieve our inclusion aims within our editorial content, via the Editorial Inclusion Board, the completion of the
Inclusive Reporting programme and the Speak Up for Inclusion feedback process, which enables any Reach colleague to share concerns about
editorial content. The Belonging Project also continued to keep newsrooms accountable for ensuring that they reach underrepresented communities.
For more on these initiatives to improve inclusive reporting, see pages 43 and 44.
Journalistic integrity and sponsorship identification
Total amount of monetary losses as a result
of legal proceedings associated with libel
or slander
We do not disclose this information.
Revenue from embedded advertising We have no revenues from embedded advertising.
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2023 SASB Index continued
Journalistic integrity and sponsorship identification continued
Description of approach for ensuring
journalistic integrity of news programming
related to: (1) truthfulness, accuracy,
objectivity, fairness and accountability;
(2) independence of content and/or
transparency of potential bias; and
(3) protection of privacy and limitation
of harm
Maintaining high editorial standards is at the core of Reach’s business. By the terms of their employment, all editorial staff are contractually bound to
adhere to the Editors’ Code of Practice (Code) as administered by the Independent Press Standards Organisation (IPSO). Similarly, all agencies and
freelancers that supply us with editorial material must comply with the Code. We report annually to IPSO on compliance with the Code and our
journalistic standards and integrity.
We hold regular, mandatory legal training for our editorial staff. We expect our staff to use their best endeavours to verify the stories that are put
forward for publication, and to adhere to the law and the Code to protect privacy and limit harm.
Each newsbrand enjoys editorial independence and, as a company, Reach is committed to protecting what is enshrined in the Code, namely the
fundamental right to freedom of expression and the right to inform, to be partisan, to challenge, shock, be satirical and to entertain. Read the Code
at www.ipso.co.uk/editors-code-of-practice.
Intellectual property protection and media piracy
Description of approach to ensuring
intellectual property (IP) protection
We protect our large portfolio of registered trademarks by monitoring applications by others, which means we can act early to oppose any
organisations seeking to register conflicting marks.
Reach makes use of a variety of resources, services and technologies to protect, detect and prevent unauthorised use and infringement of our IP,
including the unauthorised use and copying of content from our digital properties. Our in-house commercial licensing operation robustly manages
the use of our content to ensure third-party use is properly authorised including, where practicable, introducing controls over third-party use of our
content for the purposes of training AI and its output. We work with a number of partners in certain territories to protect our IP rights.
Nevertheless, despite our continued efforts and ongoing investment to protect and monitor our intellectual property, including enforcement action
where necessary, the threat to our content and innovation remains. It is something we will continue to monitor and will adapt our approach and
response accordingly.
Reach is a certified Gold Standard member of the Internet Advertising Bureau (IAB) and we participate in its efforts to uphold brand safety and
fight piracy.
Activity metrics
Total recipients of media and the number of:
(1) households reached by broadcast TV;
(2) subscribers to cable networks; and
(3) circulation for magazines and newspapers
The total recipients of media was 47 million unique digital visitors/viewers (average for 2023, data from IPSOS). Reach does not have broadcast
television channels or subscribers to cable networks. The circulation for magazines and newspapers in 2023 was 277 million sales across all our titles.
Total number of media productions and
publications produced
We have 129 brands, including websites and print products; 33 books published from Mirror Books; and 160 active podcasts.
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SHAREHOLDER INFORMATION
Registered office
One Canada Square
Canary Wharf, London, E14 5AP, United
Kingdom
Telephone: +44 (0) 20 7293 3000
Company website: www.reachplc.com
Registered in England and Wales No. 82548
Advisers
Corporate brokers
Panmure Gordon (UK) Limited
40 Gracechurch Street, London, EC3V 0BT
Telephone: +44 (0) 20 7886 2500
Numis Securities Limited (Deutsche Numis)
45 Gresham Street, London, EC2V 7BF
Telephone: +44 (0) 20 7260 1000
Independent auditors
PricewaterhouseCoopers LLP
1 Embankment Place, London, WC2N 6RH
Telephone: +44 (0) 20 7583 5000
Registrar
Equiniti Limited
Aspect House, Spencer Road, Lancing,
West Sussex, BN99 6DA
Telephone: +44 (0) 371 384 2235*
www.shareview.co.uk
* Please use the country code when calling from
outside the UK. Lines are open from 8:30 a.m. to
5:30 p.m. (UK time), Monday to Friday (excluding
public holidays in England and Wales).
If you have any queries regarding your
shareholding, please contact the Registrar.
Dividends
As a responsible business, Reach is committed
to reducing its carbon footprint across its
business activities. In support of this, Reach plc
no longer pays dividends by cheque. If you
want to continue to receive your dividends,
you will need to provide your bank or building
society account details to Equiniti as soon as
possible, so that future dividend payments
and any other money payable to you in
connection with your shares can be made
by direct payment.
Financial public relations
Teneo
The Carter Building, 11 Pilgrim Street, London,
EC4V 6RN
Telephone: +44 (0)20 7260 2700
Financial calendar 2024:
2 May 2024 Trading Update
9 May 2024 Ex-Dividend Date
10 May 2024 Record Date
31 May 2024 FY 2023 Final Dividend Payment
30 July 2024 H1 2024 Results
Annual General Meeting
The next AGM will take place on 2 May 2024 in
London. More details of the arrangements will
be posted to our website www.reachplc.com,
and will be contained within the Notice
of Meeting.
The Notice of Meeting and Proxy Card for the
AGM to be held on 2 May 2024 will be provided
to shareholders at least 20 working days prior
to the meeting date, as required by the FRC’s
Guidance on Board Effectiveness.
Share price information
The Company’s ordinary shares are listed on
the Main Market of the London Stock Exchange.
Share price information can be found on our
website, www.reachplc.com.
ISIN number: GB0009039941
SEDOL number: 0903994
Legal Entity Identifier: 213800GNI5XF3XOATR61
As well as using the Reach website to view
details of the current and historical share price,
shareholders can find share prices listed in
most national newspapers. For a real-time
buying or selling price, you should contact
a stockbroker.
E-communications
Reach encourages its shareholders to
consider receiving shareholder information
electronically. Electing to receive shareholder
communications in this way allows
shareholders to access information quickly
and securely. It also reduces Company costs
by decreasing the amount of paper it needs
to use and minimises its environmental impact.
To register for this service, please visit
www.shareview.co.uk.
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Share dealing and Shareview
The Company’s shares can be traded through
most banks, building societies and stockbrokers.
Additionally, shareholders can buy and sell
shares through a telephone and internet service
provided by the Company’s Registrar, Equiniti.
Shareview, a website operated by Equiniti,
allows shareholders to view the details of their
shareholding, register for e-communications
and send voting instructions electronically
if they have received a voting form with
an electronic reference or signed up for
Shareview. For more information about both
services, log on to www.shareview.co.uk or
call 03456 037037 for Shareview Dealing.**
** Lines are open Monday to Friday from 8:00 a.m. to
4:30 p.m. for Shareview Dealing and until 6:00 p.m.
for any other Shareview Dealing enquiries.
Warning to shareholders –
boiler room scams
In recent years, many companies have become
aware that their shareholders have received
unsolicited phone calls or correspondence
concerning investment matters. These are
typically from overseas-based ‘brokers’ who
target UK shareholders, offering to sell them
what often turn out to be worthless or high risk
shares in US or UK investments. These operations
are commonly known as ‘boiler rooms’. These
‘brokers’ can be very persistent and extremely
persuasive. It is not just the novice investor that
has been duped in this way; many of the victims
had been successfully investing for several years.
Shareholders are advised to be very wary of
any unsolicited advice, offers to buy shares at
a discount or offers of free company reports.
How to avoid share fraud
1. Keep in mind that firms authorised by the
FCA are unlikely to contact you out of the
blue with an offer to buy or sell shares.
2. Do not get into a conversation, note the
name of the person and firm contacting
you and then end the call.
3. Check the Financial Services Register
(the Register) from www.fca.org.uk, to
see if the person and firm contacting
you is authorised by the FCA.
4. Beware of fraudsters claiming to be from
an authorised firm, copying its website
or giving you false contact details.
5. Use the firm’s contact details listed on
the Register if you want to call it back.
6. Call the FCA on 0800 111 6768 if the firm
does not have contact details on the
Register or you are told they are out of date.
7. Search the list of unauthorised firms to
avoid at www.fca.org.uk/scams.
8. Consider that if you buy or sell shares
from an unauthorised firm you will
not have access to the Financial
Ombudsman Service or Financial
Services Compensation Scheme.
9. Think about getting independent financial
and professional advice before you hand
over any money.
10. Remember: if it sounds too good to be
true, it probably is!
Report a scam
If you are approached about an investment
scam, you should tell the FCA using the share
fraud reporting form at www.fca.org.uk/scams,
where you can find out more about investment
scams. You can also call the FCA Consumer
Helpline on 0800 111 6768.
If you have already paid money to share
fraudsters, you should contact Action Fraud
on 0300 123 2040.
Details of any share dealing facilities that
the Company endorses will be included in
Company mailings.
Investor relations
We communicate with the financial
community on a regular and ongoing basis to
support our stakeholders in their investment
decision process. While the investor relations
programme is driven by statutory reporting
requirements, it also contains a strong
element of additional communication in
the form of meetings and presentations.
Shareholder information continued
208
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Reach plc Annual Report 2023 197
Group five-year summary
Adjusted
2023
£m
2022
£m
2021
£m
2020
£m
2019
£m
Income statement
Revenue
569
601
616
600
703
Operating profit
97
106
146
134
153
Finance costs net of interest income
(4)
(3)
(3)
(3)
(3)
Profit before tax
93
103
143
131
150
Tax charge
(25)
(18)
(26)
(25)
(28)
Profit for the period
68
85
117
106
122
Basic earnings per share*
21.8p
27.1p
37.6p
34.4p
39.4p
* 2019 Basic earnings per share restated following the bonus issue to shareholders in lieu of and with a value
equivalent to a dividend of 2.63 pence per share in 2020.
Statutory
2023
£m
2022
£m
2021
£m
2020
£m
2019
£m
Income statement
Revenue
569
601
616
600
703
Operating profit
46
71
79
8
132
Pension finance charge
(6)
(2)
(3)
(5)
(8)
Finance costs net of interest income
(3)
(3)
(3)
(3)
(3)
Profit before tax
37
66
73
–
121
Tax charge
(15)
(14)
(70)
(27)
(27)
Profit/(loss) for the period
22
52
3
(27)
94
Basic earnings/(loss) per share*
6.8p
16.8p
0.9p
(8.6)p
30.5p
* 2019 Basic earnings/(loss) per share restated following the bonus issue to shareholders in lieu of and with
a value equivalent to a dividend of 2.63 pence per share in 2020.
2023
£m
2022
£m
2021
£m
2020
£m
2019
£m
Balance sheet
Intangible assets
877
869
860
855
852
Property, plant and equipment
114
140
157
168
225
Assets classified as held for sale
11
–
–
–
–
Other assets and liabilities*
(355)
(396)
(444)
(498)
(462)
647
613
573
525
615
Net (debt)/cash
(10)
25
66
42
20
Net assets
637
638
639
567
635
Total equity
637
638
639
567
635
* The Group implemented IFRS 16 ‘Leases’ in 2020. Right-of-use assets and lease liabilities are included in other
assets and liabilities.
209
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Strategic Report Other InformationGovernance Financial Statements