The media group which owns the Daily Telegraph newspaper tumbled into the red last year after it set aside nearly £280m to cover loans made to the Barclay family which may not be repaid.
The group said that, despite a resilient financial performance, it had made losses of £244.6m in 2023 – against profits of £33.3m in the previous year – due to the provision.
Telegraph Media Group accounts show that a £277.6m provision has been taken against amounts due from parent company undertakings “with the ongoing corporate transaction casting doubt over the recoverability of this balance”.
The Telegraph on its own website reported that the provision had come as a result of “loans extracted by the Barclay family which are unlikely ever to be repaid”.
The future ownership of the Telegraph titles and the Spectator magazine has been uncertain since June 2023, when the titles were seized by Lloyds bank after the Barclay family failed to repay £1.16bn in debts. The debts were later repaid by a UAE-backed consortium which had hoped to buy the group but were forced to walk away under political pressure.
On Wednesday, the media company said in its 2023 accounts that a detailed review of historical transactions had been undertaken in relation to amounts paid to and received from group companies and related parties.
It said this review had “identified potential irregularities in the recording of such transactions” and said that, although there had been no changes to assets and liabilities, there was “a potential risk of future possible repayment claims against the company and group in respect of such transactions”.
The Telegraph’s 2023 losses came as the group reported it had surpassed 1m subscriptions in August 2023, with subscriptions across Telegraph Media Group increasing from 734,000 in December 2022 to 1.03m in December 2023. The largest contributor to the subscription boost came from the £13m acquisition last year of Chelsea Magazine Company, a publisher of consumer titles including Classic Boat.
Turnover increased to £268m in 2023 against £254.2m in 2022, largely due to the growth in digital advertising and partnerships as well as digital subscriptions, it said.
Anna Jones, chief executive of Telegraph Media Group, said that 2023 had “reinforced the strength and resilience of Telegraph Media Group as a business”, adding: “The substantial growth in our operating profit pre-exceptional items last year was driven by significant advances in both digital advertising and digital subscription revenue.”
The Barclay family, which bought the Daily Telegraph in 2004, said: “The Barclay family is proud of its track record of investment in Telegraph Media Group, which under its ownership has been transformed into a successful digital and print media brand, with over 1 million subscribers.
“Throughout the family’s ownership the business has been managed responsibly and within all legal frameworks, with all accounts approved by auditors.”
The newspaper group is up for sale after the UAE-backed consortium walked away from its £600m planned deal to buy the group in May, saying that new legislation which blocked foreign-government-backed entities from owning British media groups meant the planned transaction was “no longer feasible.”
The decision in May by RedBird IMI, a partnership backed by Sheikh Mansour bin Zayed al-Nahyan, the UAE’s vice-president, and the US investment firm RedBird Capital Partners, fired the starting gun on an auction process for the newspaper group which is widely seen as the in-house journal for the Conservative party.
Bidders in the auction, which is being run by the banks Raine Group and Robey Warshaw, are expected to include DMGT, which owns the Daily Mail, and Paul Marshall, the hedge fund founder and backer of GB News. News UK, owned by Rupert Murdoch, has shown interest in the Spectator magazine.
https://news.google.com/rss/articles/CBMiWWh0dHBzOi8vd3d3LnRoZWd1YXJkaWFuLmNvbS9tZWRpYS9hcnRpY2xlLzIwMjQvanVuLzE5L3RlbGVncmFwaC1sb3NzLWxvYW5zLWJhcmNsYXktZmFtaWx50gFZaHR0cHM6Ly9hbXAudGhlZ3VhcmRpYW4uY29tL21lZGlhL2FydGljbGUvMjAyNC9qdW4vMTkvdGVsZWdyYXBoLWxvc3MtbG9hbnMtYmFyY2xheS1mYW1pbHk?oc=5
2024-06-19 14:52:00Z
CBMiWWh0dHBzOi8vd3d3LnRoZWd1YXJkaWFuLmNvbS9tZWRpYS9hcnRpY2xlLzIwMjQvanVuLzE5L3RlbGVncmFwaC1sb3NzLWxvYW5zLWJhcmNsYXktZmFtaWx50gFZaHR0cHM6Ly9hbXAudGhlZ3VhcmRpYW4uY29tL21lZGlhL2FydGljbGUvMjAyNC9qdW4vMTkvdGVsZWdyYXBoLWxvc3MtbG9hbnMtYmFyY2xheS1mYW1pbHk
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