The management of the UK’s third-largest regional publisher National World has hit out at a major shareholder proposing a takeover bid, accusing it of financial “irregularities”.

Media Concierge, which on Friday launched a bid for the 72.2% of National World it does not already own, rejected National World’s claims as “baseless”.

Despite the acrimony, Media Concierge revealed that “National World’s advisers have indicated that they would provide Media Concierge with access to limited and confirmatory due diligence”.

National World is the publicly-listed publisher of newsbrands including The Yorkshire Post, The Scotsman and a host of city-focused websites. It was formed by executive chairman David Montgomery in 2021 to acquire the former Johnston Press titles, assisted by investment from Media Concierge.

It is understood that Media Concierge abstained on a vote to re-elect Montgomery for National World’s leadership at its annual general meeting in May. Montgomery won regardless, and National World has since discontinued a deal that had seen Media Concierge subsidiary Mediaforce handle its national print advertising.

Media Concierge is majority-owned by founder Malcolm Denmark, who built the business providing publishing infrastructure to the news industry including newspaper inserts, leaflets, advertising and printing services.

[Read more: Battle for future of National World as shareholder launches takeover bid]

National World responds to Media Concierge takeover bid

Announcing its takeover bid last week, Media Concierge said it had not heard from National World since first proposing to buy out the remaining equity for 21 pence per share, a premium of approximately 40%, at the end of October.

National World has now “acknowledge[d] the potential merits of the possible offer”.

But the publisher claimed that on 1 October, before the takeover was first mooted, it had been “made aware of a potentially systemic pattern of historical invoicing irregularities in relation to the activities of entities affiliated with Media Concierge”.

National World went on to claim that, separately, “entities affiliated with Media Concierge are currently inappropriately withholding revenues due to [National World] totaling £4.4 million”.

The publisher said it had sought further information in order to undertake an investigation and told shareholders to “take no action at this stage”.

Media Concierge responded that the allegations are “completely baseless and are strongly denied in their entirety.

“No evidence has been provided to support them, and the timing of the emergence of these entirely unjustified allegations coincided with Media Concierge’s initial approach to National World.

“The amounts allegedly ‘withheld’ by Media Concierge are subject to Media Concierge’s substantial counter-claim, in excess of the £4.4 million amount, for a number of breaches of contract by National World.

“We have put National World on notice that Media Concierge will hold the makers of these false and misleading statements fully responsible for them.”

A spokesperson for National World told Press Gazette that it has presented “evidence” to Media Concierge subsidiary Mediaforce (London) “concerning its activities”.

“Irrespective, if Mediaforce (London) has nothing to hide then there can surely be no objection to our carrying out a forensic audit?” the publisher added.

The post National World accuses shareholder seeking takeover of financial ‘irregularities’ appeared first on Press Gazette.

National World chairman David Montgomery has claimed the publisher remains the “best qualified” candidate to buy Telegraph Media Group.

Montgomery revealed in a statement accompanying the publisher’s full-year results on Thursday that National World remains in the running as the UAE-linked Redbird IMI acquisition led by former CNN boss Jeff Zucker looks to be in doubt.

The Government is introducing legislation to ban foreign states from owning UK newspapers and current affairs magazines.

Meanwhile, Culture Secretary Lucy Frazer has said she is “minded to” refer Redbird IMI’s takeover to an in-depth investigation after Ofcom found the deal may “operate against the public interest” as majority investor International Media Investments (IMI), owned by UAE vice president Sheikh Mansour, “may have the incentive to influence TMG in a way that could potentially act against the public interest in the UK by influencing the accurate presentation of news and free expression of opinion in the Daily Telegraph and the Sunday Telegraph newspapers”.

Montgomery and National World wanted to take part in the original sale process before it was cut short by Redbird IMI securing a deal with former TMG owners the Barclay family.

Montgomery has now said he still considers there to be a chance his company will end up with the Telegraph titles, with other interested parties believed to include GB News investor Sir Paul Marshall, DMGT owner Lord Rothermere, and Rupert Murdoch’s News UK (for The Spectator only).

He said: “In the second half of 2023 National World competed in the aborted auction for The Telegraph. The conclusion of its ownership change is still in doubt but the opportunity was in line with both the founding principles of National World – that it would be a consolidator in the sector – and its ability to leverage both its infrastructure to extract significant synergies and its proven management expertise.

“Our view remains that National World remains the best qualified among the various candidates for such a deal both in terms of industry qualification and also editorial independence, as well as the absence of any competition issues.”

National World has already been on an acquisition spree, with seven purchases in 2023:

• Rotherham Advertiser
• B2B publisher Insider Media
• Digital football publisher Scoop Dragon
• Video-first and World of Women’s Sport publisher News Chain
• Newry Reporter newspaper in Northern Ireland
• Midland News Association
• Publishing platform supplier Press Computer Systems (PCS)

However National World is now looking at selling off tech provider PCS to content and commerce management provider Naviga UK1 Limited, which it said provided a “greater opportunity” for it to “remain both significant and influential within the publishing sector”.

These acquisitions helped National World grow revenue in 2023 by 5% to £88.4m, with digital up 13% to £18.4m – largely in line with the pre-close trading update issued in January. It is aiming to reach £100m in revenue in 2024.

Print advertising was down 1% and circulation revenue was down 3%.

Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) was down 2% to £9.5m. Adjusted profit before tax was up 4% to £9.7m and operating profit was down 2% to £9.1m.

In the first quarter of 2024 EBITDA is “slightly higher than internal expectations with total revenue slightly lower”.

“There is still some continuing market volatility as audience and programmatic yields are impacted by algorithm changes by the global social media platforms,” the publisher said.

BBC local news expansion ‘predatory’

Montgomery also used the results to launch another broadside against the BBC, accusing it of “predatory behaviour”.

He said the corporation “uses taxpayer funds to compete online, threatening local independent journalism. It is remarkable that the BBC, financed by a compulsory tax, is permitted to enforce its monopoly in the news sector month after month.

“In January 2024, 3.1 billion page views for BBC News dwarfed the combined total of the UK’s 28 leading independent news sites, including Mail Online, The Sun and, of course, National World. In no other sector would such an unfair market be tolerated by regulators.”

National World received £1.8m in 2023, up from £1.5m the year before, from the BBC-funded local democracy reporter scheme and 58 Meta-funded community news reporters although the latter scheme is now being phased out.

Moving away from news to ‘wider content agenda’

Montgomery also revealed plans for National World to be “less dependent on news provision” as it transitions from having a “specific expertise in news journalism, restricted by geographical focus, to a wider content agenda distributed across all platforms”.

He said this will be part of a plan to “pivot the group towards growth for the first time in two decades”.

Montgomery added: “Instead of duplicating the market, the routine approach of conventional news providers, National World will specialise in original and expert content that is monetisable across multiple formats and channels, in consumer and marketing sales.

“Subscriptions and paid content will feature across many activities including the premium print titles, sport, culture and business coverage together with a focus on affiliates revenue.”

This year National World will launch a new “local social media network platform” called Your World where members of the public and organisations can post their content directly.

Montgomery said this will provide “a significant improvement in content and service for around 50 of our heritage brands. This comes with IP developed internally and with partners that may be viable as a marketable asset to service other media operators.“

Montgomery also revealed AI is being used at National World to “boost local video advertising sales, video news bulletins and automated print pages” with it currently producing around 200 pages per week. The aim is for AI to produce around half of all pages for the publisher’s weekly titles by the end of the year.

A subscriptions strategy at The Scotsman, Yorkshire Post and The Newsletter in Belfast has seen 6% annual subscription growth at the Scottish title, Montgomery said, adding that they are now set up “to increase our loyal customer base even further in 2024, despite the possible market changes to cookies”.

Montgomery also said video was a strong growth area, with a quarter of its journalists “fully trained”. Video audiences were up 12% in 2023 from 357 million views in 2022 to 398 million and video revenue is now £1.5m.

The post National World still ‘best qualified’ to own The Telegraph, David Montgomery claims appeared first on Press Gazette.

David Montgomery’s National World has bought Midland News Association (MNA), which until now was the UK’s largest independent regional news publisher.

National World said the acquisition would “strengthen its UK national footprint” and give it a “significantly enhanced position in the Midlands” which would compare to its market positions in Yorkshire and Scotland.

National World has also bought Press Computer Systems, which supplies publishing platforms for both MNA and other major publishers including Newsquest and DC Thomson, and said the two acquisitions would take it above the £100m annual revenue mark.

National World paid £11m in cash for the combined acquisitions, which excluded certain real estate assets.

Phil Inman, chief executive of MNA parent company Claverley Group, said: “The Midland News Association, including iconic Express & Star and Shropshire Star brands, has been owned and managed by the Graham family for generations.

“Agreeing to sell was an extremely difficult decision for the shareholders, but after careful consideration, the shareholders concluded that a larger media organisation was better placed to secure the future of the business.

“The sale of the MNA will result in Claverley Group exiting from regional newspaper publishing and as such, the sale of PCS was a logical extension to the deal for both parties.”

Express & Star and Shropshire Star ‘largest remaining independent regional assets in England’

Previous Press Gazette analysis of the regional market ranked National World as the second biggest regional publisher in the UK by online audience, with MNA coming sixth. By daily and weekly print circulation, National World was third and MNA was fourth.

MNA’s Express & Star, which covers the Black Country and Staffordshire, was the sixth biggest regional daily newspaper in the UK by circulation in the first half of 2023, down 18% year-on-year to 13,213. The title was born in the late 19th century when businessman Thomas Graham and steel magnate Andrew Carnegie combined the Wolverhampton Evening Star and rival the Evening Express. The Graham family have owned it ever since.

Meanwhile sister daily the Shropshire Star, which launched in 1964, is the UK’s ninth biggest regional daily, on 9,914 (down 17%).

MNA announced this month that the websites of the two newspaper titles had together reached 100,000 registered users, having introduced a requirement for people to sign in to read about 10% of articles in May. Group digital editor Mark Morris said the intention was next to launch more premium content and a paywall.

National World said the two newspapers were “the largest remaining independent regional assets in England” and said they would add 40% to its group-wide daily circulation.

Online, National World already publishes Birmingham World and the publisher said its portfolio in Birmingham and the Midlands is expected to average 20 million page views per month with the addition of the MNA brands.

MNA claimed in its latest financial accounts to have had 182.1 million page views across the group in 2022, down 0.5% compared to 2021.

National World also already owns B2B publisher Insider Media, which it bought in May and said it has a strong presence in the Midlands. Some of its biggest titles elsewhere include The Scotsman and the Yorkshire Post.

National World chairman David Montgomery said: “These iconic and premium brands will strengthen our footprint, improving our Midlands and national rankings in UK media. Our innovations in TV and video, specialist content and our move to greater automation will enhance the future performance of these new additions to the group.

“The greater scale will help underpin our accelerating transition to a multi-platform content business, focused on creative talent. We continue to re-train and re-equip both editorial and commercial staff to serve all platforms – print, online, TV and video, events, business information and e-commerce.”

Midland News Association in profit in 2022

Other MNA titles include the free Chronicle Week with an average of 93,645 copies distributed in the West Midlands per issue in 2022. MNA claims Chronicle Week, created in 2018 by merging seven titles in the Chronicle Series into one, has the largest distribution of any free weekly newspaper in the UK.

Its weekly titles include the Shrewsbury Chronicle, Telford Journal and Bridgnorth Journal and MNA also owns farming and lifestyle magazines.

MNA’s EBITDA (earnings before interest, taxation, depreciation and amortisation and excluding exceptional costs) in 2022 was down 27% to £2.2m. Profit after tax was £1.4m, up from a loss of £1.7m in 2021. The business claimed to have made investment in both its print and digital products “balanced alongside increased efficiencies and cost management”.

National World said that after completion of the deal it has more than £10m in cash with outstanding debt repayable in December of £1m.

In total it has paid £14m for six acquisitions completed this year, all funded by its cash resources, and the company said these are expected to contribute revenues of around £23m and EBITDA of more than £4m next year taking into account “the benefit of operational efficiencies”.

The previous acquisitions made in 2023 are: the Rotherham Advertiser, Insider Media, digital football publisher Scoop Dragon, video-first and World of Women’s Sport publisher News Chain, and the 155-year-old Newry Reporter newspaper in Northern Ireland.

National World has also confirmed it is considering making a bid for Telegraph Media Group.

Journalists at National World have held three days of strike action this month over pay and the National Union of Journalists said it was “dismayed” by news of the latest acquisitions while this dispute is ongoing.

NUJ national organiser Laura Davison said: “Members are stunned at National World’s actions as they shun discussions with the NUJ on improved pay for members. Paying millions for new titles as existing journalists at the company share the impact of financial difficulties shows a blatant disregard for the value of its staff.

“It is clear National World’s priorities lay far from improving journalists’ pay and retention – reps will meet early next week to discuss today’s news alongside next steps in the campaign.”

The post David Montgomery’s National World buys Midland News Association appeared first on Press Gazette.

Journalists at NationalWorld’s national news website have said morale within their team is at “rock bottom” in a letter to the company’s HR department.

The problems at NationalWorld.com, they claimed, are in part caused by a drop in the number of managers, which they said has also led to chronically late publication of stories.

The site was launched in March 2021 and in the past few months has seen a wave of departures.

The NUJ members who sent the letter singled out company chief executive David Montgomery for particular criticism, alleging he has pushed the national news site away from “incisive, informed” coverage and injected it with socially conservative politics.

The letter was sent from NationalWorld.com NUJ members and the NUJ National World Publishing Chapel.

The week after the letter was sent, NUJ members across National World’s news titles voted to go on strike as part of a pay dispute, separately from the concerns raised by the NationalWorld.com staff.

National World declined to comment for this story.

NationalWorld staff feel there is ‘no one left steering the ship’

The NUJ letter was sent on Wednesday 23 August, shortly after a wave of compulsory and voluntary redundancies from both NationalWorld.com and the wider business. In July Press Gazette reported that the company’s headcount had declined by 27% in the 18 months since it acquired the former JPI Media newspaper titles.

The letter to HR said: “Everyone who was involved in data journalism, investigations and audience engagement [at NationalWorld.com] has now left our team, either as a result of the disastrous restructuring or the voluntary redundancies that immediately followed.”

The union claimed the restructure had initially involved the creation of eight new specialist roles, including deputy editor and SEO editor, but “half of the originally proposed roles are vacant or no longer exist”.

They said “a total lack of management capacity” had left staff feeling as though “there is no one left steering the ship” and that “stories submitted for editing by 5pm [are] still waiting to be subbed by lunchtime the following day…

“There have been times when items filed before the weekend are still waiting to be published on a Monday because there is nobody with the time to check them.”

The letter describes unclear delineation of roles, with SEO writers and generalist and specialist reporters “pushed around from team to team without any discussion”.

Similarly, it complains that the launch of National World’s Freeview channel, Shots!, has meant “valuable time that could be spent researching and writing stories is wasted on chasing unwilling members of the public up and down the high street” for vox pops.

“Managers are increasingly talking about the page view performance of the team not being good enough, but in the next breath they will be telling one of us to go out to film mandatory vox pops that will generate no page views.”

Shots! launched last month and is populated with content produced by National World journalists around the country. The company did not hire new staff to run the channel.

The NUJ members said: “The kind of videos being suggested do not reflect the incisive, informed and intelligent coverage that was promised from our teams when NationalWorld.com was first launched.

“It’s clear that someone – presumably David Montgomery – has decided that a change in direction is needed, but nobody seems able to articulate what that means in practice.”

David Montgomery lays out ‘socially conservative’ themes for coverage

Montgomery, a long-time media executive who previously served as chief executive of the Mirror Group and Local World, was accused in the letter of steering NationalWorld.com to the political right against the wishes of employees.

The letter said: “The closest we’ve had to any steer on editorial direction is the note from David setting out his wish for us to focus on broad themes like the ‘control freakery of London-based leaders’, promoting ‘individual freedom and discipline’ and exposing those who ‘wilfully make no contribution to society’.”

“We are coming under increasing pressure to put our names to content that we disagree with…”

One National World journalist told Press Gazette those themes had been interpreted by staff “as a dog whistle for a move towards right-wing and socially conservative politics”.

The journalist echoed reports that Montgomery has directly involved himself in the output of the site, becoming “de facto editor” of NationalWorld.com and leading daily editorial meetings.

“What was perhaps the most shocking thing that resulted from us being thrust into this close encounter with David though was to see first-hand just how little clue he has about digital news… ​I don’t know of a single colleague left at NW.com that hasn’t lost total confidence in the management and editorial direction.”

In July the National World group NUJ chapel passed a vote of no confidence in Montgomery, urging shareholders to intervene as the company simultaneously cut roles while delivering a maiden dividend.

The letter said staff had been kept in the dark on the site’s aims: “How can we be expected to meet the goals required by the company if we have no idea what they are? All we know at the moment is that morale is at rock bottom and the page views aren’t far behind.

“We are being made to feel as though this is our fault, but we’re not to blame,” they continued, citing the recent redundancies.

Voluntary redundancy reopened for NationalWorld staff

August’s NationalWorld.com letter to HR concluded: “All the issues above have created a horrible working environment and, sadly, the behaviour of some of our managers is only fuelling the misery…

“Our managers should be people who we can trust to support us… Instead, we’ve had managers telling us that refusing a task is not an option – even if we are deeply uncomfortable with what is being asked of us.”

Those practices, it said, are “making daily life so unhappy for us, that has people unable to sleep properly at night… It feels like one endless mind game”.

“We don’t believe it is too late for these issues to be addressed and for this team to have a fresh start, but it’s clear that intervention by HR and other senior managers who can provide the necessary leadership is urgently needed.”

Press Gazette understands that since the letter was sent to HR, the offer of voluntary redundancy has been reopened to staff at NationalWorld.com but not the wider company.

The National World journalist with whom Press Gazette spoke said: “The attitude is ‘if they don’t like it, they can go’.”

During the last voluntary redundancy round in July National World invited staff who found the new operating model “concerning” to apply for the scheme.

The post NationalWorld.com staff say morale at ‘rock bottom’ in letter to HR appeared first on Press Gazette.

Update, 14 August 2023: Daily Mail parent company DMGT has formally confirmed it is interested in acquiring the Telegraph Media Group, days after rival newspaper publisher National World did the same.

Sky News reported on Saturday that the company was “courting financial investors” to help fund a bid to buy The Telegraph. DMGT confirmed those reports later the same day.

A spokesperson for the Mail publisher told Sky: “We have been engaged with many parties over the possible synergies between DMG Media and the Daily Telegraph and have registered our interest with Lloyds [Banking Group] but we have no formal plans and there is no consortium.”

DMGT was widely tipped as a contender for the Telegraph when the Barclay-owned newspaper was first placed into receivership in June. Mail proprietor Lord Rothermere bid for The Telegraph last time it was on auction in 2004, and in 2019 the company bought another national newspaper, the i, from JPI Media.

Rothermere took DMGT off the stock market in late 2021 for £1.6bn – likely limiting the amount of cash he has on hand to bid for The Telegraph, the value of which has been put anywhere between £500m and £1bn. Sequential interest rate rises also mean a debt-funded acquisition would be much more expensive now than it would have been in recent years.

Sky News’ Saturday report said Rothermere was “understood to be holding talks with funds based in the Middle East” – which would make DMGT the latest prospective Telegraph bidder reported to be courting deep-pocketed Middle Eastern investors to finance an acquisition. Early reports claimed Will Lewis, the former Telegraph editor and current chief executive of The News Movement, could also use “access to Middle Eastern financing” to power a bid.

Press Gazette analysis previously suggested a DMGT acquisition of The Telegraph would give the Mail group a 50% share of the daily national newspaper market.

Original story, 10 August 2023: Regional newspaper publisher National World has said it is considering a bid for the Telegraph Media Group.

The company, which publishes titles formerly owned by JPI Media such as the Yorkshire Post and The Scotsman as well as newer city and national news websites, said in a short statement on Thursday that it "notes media speculation" it may participate in the Telegraph sale process.

It said its "growth strategy is rooted in actively exploring opportunities to build its business through acquisitions and implementing its new operating model for owned assets.

"The Board continues to evaluate accretive opportunities to grow the business and will consider participating in a sale process for Telegraph Media Group as and when such a process formally commences," it said. "There can be no certainty that an acquisition will take place nor as to the terms of such an acquisition."

Last year National World considered buying Reach, the UK's biggest commercial publisher and largest regional publisher, saying there would have been "considerable industrial and financial advantages to combining the newspaper portfolios of the two companies", but said it ultimately decided the circumstances were not right.

The company has made five acquisitions in 2023: the Rotherham Advertiser, B2B publisher Insider Media, digital football publisher Scoop Dragon, video-first and World of Women’s Sport publisher News Chain, and the 155-year-old Newry Reporter newspaper in Northern Ireland.

The announcement comes shortly after National World launched a television channel as well as a slew of senior departures from the company amid rounds of compulsory and voluntary redundancies.

Also on Thursday the NUJ announced it has issued ballot papers to National World journalists asking whether they are willing to take industrial action against the company over an ongoing pay dispute. The union said it is encouraging its members to vote in favour of both strike action and action short of a strike.

Last month NUJ members at National World passed a no-confidence vote in chairman David Montgomery over the company's decision to issue its first shareholder dividend while simultaneously shedding staff through a round of compulsory redundancies.

The Telegraph and The Spectator are up for sale after effectively being repossessed by Lloyds Banking Group from the Barclay family, who had owned the titles for the past two decades.

Although the two publications are themselves profitable, with Telegraph Media Group growing profit before tax by a third to £39m last year, the Barclays reportedly owe a debt in the area of £1bn to the banking group which has grown unserviceable.

[Read more on Telegraph sale: Period media property for sale, extensively modernised - £600m ONO]

The post DMGT and National World each consider bid for Telegraph Media Group appeared first on Press Gazette.

National World has cut its workforce by 27% compared to the start of 2021 when it acquired all of the former JPI Media newspaper brands.

National World’s overall staff numbers are down from around 1,500 in January 2021 to 1,100, according to a half-year report published on Monday. The average across the whole of 2022 was 1,179.

The publisher claimed “productivity has increased as this reduced number now service around 20 new brands and five newly acquired businesses”.

The former JPI Media titles include The Scotsman, Yorkshire Post, Sheffield Star and Portsmouth’s The News. Since the acquisition, National World has also launched a number of digital-only city brands, such as London World and Manchester World, as well as a UK-wide news website also called National World.

National World has made five acquisitions in 2023 so far: the Rotherham Advertiser, B2B publisher Insider Media, digital football publisher Scoop Dragon, video-first and World of Women’s Sport publisher News Chain, and the 155-year-old Newry Reporter newspaper in Northern Ireland.

The publisher said its new operating model, which is creating “fully automated and integrated print, online and video brands” including with the use of AI, will deliver £1.1m of savings in the second half of 2023, with around £2.5m of savings per year.

The results statement said: “…the new model primarily focuses on sustaining our news brands in local markets by increasing reach and customer engagement. Investment in technology and platforms is well advanced and the first relaunches of fully automated and integrated print, online and video brands is expected this quarter.”

National World has spent £0.9m on cost reduction and restructuring in the half-year, compared to £1.3m in the same period in 2022.

Total restructuring costs across the whole of 2023 are expected to reach about £2m, with combined annualised costs savings of about £4m.

Most recently more than 25 National World journalists left the company on a voluntary or compulsory basis, of around 50 put at risk, in a restructure that affected numerous brands including the national website.

A separate round of restructuring last year saw around 30 journalist roles cut at the legacy ex-JPI titles, with a similar number created on the digital-only city brands.

Earlier this month National Union of Journalists members at National World passed a vote of no confidence in chairman David Montgomery.

National World half-year financial results

Overall, National World revenue was down 4% year-on-year to £41.6m in the first half of 2023.

However it saw improvement in the second quarter, when it was flat, compared to an 8% decline in Q1. It said its acquisitions had mitigated against further decline.

National World’s adjusted profit before tax was £3.2m, down 43%, which it attributed to “challenging trading conditions”, the 4% revenue decline, and higher operating costs.

The city brands and National World website are predicted to reach profitability in the second half of 2024.

Three-quarters (£31.7m) of National World revenue comes from its legacy local print newspaper titles, including digital packaged with print. This portion, down 8%, is almost evenly split between advertising (£14.6m) and circulation (£14.9m) revenues.

The half-year results include plans to automate the production of National World’s weekly titles, promising “purely local content”, and consolidate a “daily press unit to centrally relaunch eight titles in a modern format”.

Digital revenue, comprising all revenue sold programmatically, digital-led direct sales, subscriptions, syndication and revenue generated from Google and Meta initiatives, was up 9% year-on-year to £8.9m. Advertising is the biggest chunk (£5.6m).

Digital subscription revenue was flat year-on-year despite an 11% drop in subscribers. The publisher said premium subscribers for The Scotsman, which has seen a new paid app launch, together with the Yorkshire Post and News Letter in Belfast, which will soon see similar upgrades, were however up by 5%.

National World’s titles had combined average monthly page views of 141 million in the half-year, up 21% on the previous year.

The company said video was a particular area of growth, with training for 250 journalists. Video views were up 49% year-on-year to 275 million in total, with engagement up 12%, while video advertising revenues were up 67%.

Chairman Montgomery said the publisher is concentrating on a mixture of “acquisitions, consolidation and innovation”, with the first two components together expected to grow full-year revenues.

He said: “The investment to support new launches and organic development was maintained despite an advertising downturn and a decline in revenue.

“The reliance on heritage print assets has begun to reduce as the business pivots towards a more diverse and dependable model through both acquisitions and continued growth in specific digital activities.

“Currently trends are more encouraging and the company is now well positioned to benefit from its investment in developing areas like video, subscriptions, apps and its new brands.”

The post National World has cut one in four jobs since JPI takeover in 2021 appeared first on Press Gazette.

National Union of Journalists members at National World have passed a no confidence vote in company chairman David Montgomery, urging shareholders to “intervene as a matter of urgency”.

The votes, which were delivered by 16 chapels representing National World journalists, come as the company seeks to cut a net of 21 staff while simultaneously delivering a maiden dividend.

The NUJ said Montgomery had “lost the confidence of hundreds of journalists”.

What’s happening at National World?

Some 34 jobs at National World are set to be axed across local titles and the company’s eponymous national news website, nationalworld.com, and 50 journalists have been put at risk of redundancy.

The NUJ said that “while some of those affected might be redeployed due to the creation of 12 new roles and one existing editor vacancy, it is expected that at least 21 journalists will be left without jobs”.

A source told Press Gazette last month that National World staff had been “completely shocked and blindsided by this move, no one saw it coming. I expect a lot of staff will now look to leave, even if their job isn’t at risk”.

No minimum payment has been proposed for journalists made redundant with less than two years’ service. The NUJ said: “Journalists yet to reach settlements on their pay had been given until June 30 to accept a below-inflation offer of 4.5 percent or risk the withdrawal of back pay to April 1 when a deal is eventually agreed.”

Despite this 13 of the 14 recognised chapels still involved in negotiations rejected the pay offer. The chapels and National World are now proceeding to conciliation service ACAS to resolve the dispute.

NUJ national organiser Laura Davidson said: “Our chapels want to see real engagement on issues around unfair pay that our reps have been raising for three years now, and more meaningful recognition of the cost of living crisis that is impacting NUJ members across the board.”

[Read more: National World to cut 25 editorial jobs with 14 roles created – NUJ]

Why has the union passed a no confidence vote in David Montgomery?

Last week National World employees were told the company was withdrawing a planned deputy editor role at nationalworld.com, which the journalists’ union said was followed by “the discovery that the role was being withdrawn so that Mr Montgomery himself could play a more hands-on role in the day-to-day management of the website”.

National World’s maiden dividend is due to be paid to shareholders on Wednesday (5 July). The NUJ said Montgomery would be among the biggest beneficiaries, earning £22,000 payable through shares linked to a management performance scheme and £96,000 through shares purchased by Montgomery Media Ltd in order to launch National World plc. The total dividend issued will be £1.36m.

Chapels representing staff at titles including The Scotsman, the Yorkshire Post, the News Letter, Yorkshire Evening Post, Sheffield Star, Sunderland Echo and Edinburgh Evening News delivered no confidence votes.

The NUJ said BBC-funded local democracy reporters hosted at National World “have also said they have no confidence” in Montgomery’s leadership.

An NUJ National World Group chapel spokesperson said: “The board must see that allowing a major shareholder to not only serve as executive chairman and the effective lead for all editorial strategy, but to also appoint himself as the de facto editor of the company’s flagship national website is a recipe for disaster.

“Where is the very necessary scrutiny coming from when one man holds so much sway? If the board will not exercise that crucial responsibility, then the other shareholders must intervene as a matter of urgency.”

Press Gazette has approached Montgomery for his reaction. A National World spokesperson declined to comment.

Who is David Montgomery?

Montgomery has been a high-profile media executive for several decades. Once editor of the News of the World, he subsequently became chief executive of the Mirror Group, leading the business to take a stake in the young Independent newspaper.

After leaving his media investment vehicle Mecom under pressure from shareholders in 2010, Montgomery bought the regional titles held by Daily Mail publisher DMGT and founded regional publisher Local World. That company was bought in 2015 by Trinity Mirror, now rebranded Reach.

Montgomery re-emerged in 2020 with National World, which he used as a vehicle to acquire the steeply discounted former Johnston Press/JPI Media titles.

[Read more: National World CEO David Montgomery sets sights on The Independent and says £1.2m a year from Duopoly ‘not enough’]

The post National World journalists pass no confidence vote in chairman David Montgomery appeared first on Press Gazette.

National World has put 46 editorial staff at risk of redundancy, according to the National Union of Journalists.

The company has said 25 full-time equivalent roles will be closed and 14 new roles will be created, according to the union, which estimated that 46 editorial staff have been put at risk of redundancy and 11 people could be left without roles after the consultation period ends.

Press Gazette understands that a number of the redundancies affect the group’s national news brand, also called National World.

Press Gazette also understands that deputy editor and audience editor positions at several of the publisher’s legacy titles, including the Portsmouth News, Edinburgh Evening News, Sheffield Star and Yorkshire Evening Post, have also been put at risk.

One source, who asked to remain anonymous, told Press Gazette: “Staff are completely shocked and blindsided by this move, no one saw it coming. I expect a lot of staff will now look to leave, even if their job isn’t at risk.”

A second source told Press Gazette: “From recruitment freezes that have left staff struggling to cope to this latest wave of redundancies, morale is now at an all-time low.

“Many of the staff in the firing line are some of the most experienced in the business and are serving on the company’s former flagship papers. All that vital patch knowledge, built over years, is now at risk of being annihilated.”

The source added that they felt the company was “killing the reputation and credibility of local papers that have served their communities for decades” with “clickbait, SEO tosh”.

National World was founded at the end of 2020 when ex-Local World chief executive David Montgomery bought JPI Media, including its legacy newspaper titles such as the Yorkshire Post and The Scotsman, for £10.2m.

Since then it has launched a series of new city websites covering Birmingham, Bristol, Glasgow, Liverpool, Manchester, London and Newcastle, and a national website with the same name as the company. The National World website became the company’s biggest site by page views a year after its launch.

The company employed 722 editorial staff on average in 2022, according to its annual report.

Staff told: Accept 4.5% pay deal or forfeit back pay, NUJ says

The NUJ said the redundancy announcement came in the same week that the company allegedly gave staff an “ultimatum on pay”. The union reported that staff were told to accept a 4.5% pay increase offer by 30 June or forfeit backpay to the 1 April review date. The NUJ National World group chapel said the approach was “disgraceful”, claiming the slow progress was down to the company’s “refusal to enter into any meaningful talks at local or national level”.

The group chapel also said: “Our members are extremely angry about the proposed redundancies and associated restructuring, not least because the company does not appear to have fully thought through how the changes will work in practice. We have significant concerns about the wellbeing of members in the teams where cuts are proposed and fail to see how forcing out experienced staff will help the company to reach its goals for audience growth.”

The statement added that some affected staff reportedly had less than 24 hours to prepare for their consultation meetings.

Laura Davison, NUJ national newspaper organiser, said: “The news of job cuts came out of the blue to National World members and has left them feeling shocked and angry. It is only a matter of days since the company sat in pay negotiation meetings with reps and said that increasing this year’s pay offer could put jobs at risk. There has been no increase and now jobs are at risk anyway.”

Davison added that £1.36m is due to be paid out to National World shareholders next month in their first dividend, with Montgomery saying last month this would recognise the company’s “significant progress over the last two years”, and she noted that the company has made multiple acquisitions in 2023 so far: Rotherham Advertiser, B2B publisher Insider Media, digital football publisher Scoop Dragon, video-first and World of Women’s Sport publisher News Chain, and the 155-year-old Newry Reporter newspaper in Northern Ireland. Montgomery said in May more acquisitions would come in the “coming months”.

National World declined to comment.

The post National World to cut 25 editorial jobs with 14 roles created – NUJ appeared first on Press Gazette.

National World executive chairman David Montgomery has set out his vision for the publisher as it reported a dip in revenue but increased profit for 2022 thanks to cost savings.

Some two years after buying the former Johnston Press/JPI Media newspaper portfolio, Montgomery, a former chief executive of the Mirror Group (now Reach), said his mantra for the publisher’s creative workforce is: “Think local, act national, be global.”

This means he said: “The expansion and ambition of the company is facilitated by the strategy of producing original content rather than replicating the news market and the realisation that a wider content agenda will attract viewers both nationally and internationally.”

National World reported revenue down £1.9m year-on-year to £84.1m and pre-tax profit up from £8.6m to £9.3m. The company made annualised cost savings of £4m.

Digital revenue was up 26% year-on-year to £16.3m, representing 20% of the total (compared to 25% at rival publisher Reach). Video advertising doubled year-on-year.

National World reported digital revenue up 42% year-on-year in the first half, slowing to 14% in the second and then 9% in January and February this year (compared with Reach which reported revenue up 1% in 2022 – but down 6% in the final quarter as the cost of living crisis hit).

A change to local titles, Montgomery said, could see them more aligned by the most relevant specialisms to their market: for example, in Yorkshire, Scotland and Northern Ireland heritage, arts and culture, business, environment and rural affairs are all areas to be prioritised. National World owns legacy titles the Yorkshire Post, The Scotsman and The Belfast News Letter in these areas.

“Other regional daily titles are being relaunched in 2023 to relate more closely to metropolitan markets they serve and organised in formats reflecting online characteristics,” Montgomery added in his statement alongside the company’s full-year results.

This year, Montgomery said in his statement, would be “the year of a new operating model propelled through careful investment, taking that ambition a step forward while maintaining profitability”.

This new model means, he said: “The company is investing in pivoting towards the customer as a first priority, targeting content that has relevance and usefulness to individuals and communities. The ethos is predominantly middle market, family and consumer-orientated.”

Montgomery said the company would go from a “digital first” model to being “digital only”, although he suggested it will still produce print newspapers nonetheless.

“Newspapers will be produced on that basis rather than being the products of multiple industrial processes that should have been abandoned years ago,” he said.

“Ironically the printed newspaper products will achieve greater quality and relevance, in part mirroring characteristics of social media but strictly curated. True to our publishing heritage we will make our small weekly papers exclusively local in all content – banishing the generic content that was a feature of previous and counterproductive cost reduction measures.”

As well as the legacy titles bought from JPI Media, National World now owns 16 City World websites, which it says means it provides “full coverage” of cities in England and Scotland, plus celebrity-focused People World and sports website 3 Added Minutes. It has also launched a US version of its UK national website National World to begin creating a “global footprint”.

Montgomery claimed that the publisher’s growth since he bought it two years ago was a “considerable achievement but one not based on the traditional cost-cutting of the sector.

“While promoting efficiency through streamlining central services and the greater use of technology, National World has continuously invested in the talent and creativity of its staff to promote more and better quality products.”

However, the overall National World workforce did reduce by 10% from 1,216 on 1 January 2022 to 1,099 on 31 December and the group did run a restructuring programme to “drive efficiencies and tightly manage all operating costs” last year.

The results statement revealed this created annualised cost savings of £4m, with restructuring and redundancy costs of £3.3m in 2022 (compared to cost savings of £3.6m in 2021).

The company said its original investment in buying out JPI Media for £10.2m had now been repaid almost twice over.

The group had an average of monthly unique users of 42 million and page views of 111 million in 2022, up from 37 million and 110 million. It said audience performance had been “volatile” due primarily to Google algorithm changes and macroeconomic conditions. Only one National Website appears in Press Gazette’s monthly ranking of the UK’s top 50 news websites – The Scotsman, with an audience of 4.1 million in January.

Digital growth partially offset an 8% decline in print revenue to £66.3m, with a higher drop in the second half of the year of 12% put down to the Queen’s death and worsened economic conditions.

Advertising revenue fell by 6% year-on-year to £31.9m, down 14% in the second half of the year due to a “more uncertain trading environment”.

Circulation revenue dropped by 9% to £31.6m, falling by 8% in the first half of the year and 11% in the second. Its average monthly circulation volumes were 1.8 million for the daily newspapers and 0.8 million for the weeklies, declines of 18% and 16% respectively but this was partially mitigated by cover price increases.

The company had a cash balance at the end of the year of £27m, up £4m from a year earlier, which it said gave it “significant financial flexibility”.

National World is now preparing to give its first dividend of 0.5 pence per share subject to shareholder approval.

National World’s figures for the year so far do not include its recent acquisitions of digital football publisher Scoop Dragon and video-first publisher News Chain, which it said would further “add over 10% audience improvement”.

“Trading is expected to remain challenging for the first half,” the publisher said. “However, management continues to innovate to address the headwinds faced across the industry, including revenue initiatives, while transitioning to a digital-only operational model providing customers with quality and original content across all genres and platforms. The group maintains its performance expectations for the year.”

National World salary plea

UPDATE on 17 March: The National Union of Journalists has urged National World to follow its positive financial figures by accepting pay claims put forward by local chapels at the publisher.

According to the NUJ, a newly-qualified senior journalist at some National World titles can expect to earn £22,753 per year – compared to £26,855 for journalists at the same stage of their career at flagship title the Yorkshire Post.

Following its own pay negotiations, senior journalists at Reach earn a minimum of £30,000. National World journalists want a similar minimum salary floor to be set.

They are also asking for a 10% pay rise for all editorial staff to make sure those who would not benefit from a rise in the minimum salary do not suffer a real-terms cut.

An NUJ National World group chapel representative said in a statement on Friday: “While the company’s latest financial results offer welcome news on the digital growth of the business, the increase in operating profits has not been without sacrifice. A number of newsrooms have seen cuts to their teams over the past 12 months, with experienced and respected journalists leaving as a result.

“Those that remain are working harder than ever and have – as Mr Montgomery noted – shown great dedication and professionalism despite the challenges faced. We hope to see that commitment now rewarded with a meaningful pay rise that not only recognises the financial pressures facing individual staff, but also addresses disparities that exist within our newsrooms.”

The post National World cuts costs, increases profit as CEO says: ‘Think local, act national, be global’ appeared first on Press Gazette.

National World has said it expects to return a shareholder dividend by the time of its full-year results in March 2023 despite the ongoing global economic turmoil.

In its half-year results published on Monday, the business revealed it had grown its adjusted pre-tax profit by 60% year-on-year from £3.9m to £5.9m in the first half of 2022.

Total revenue rose at the regional publisher by 3% to £43.5m as digital revenue increases made up for declining print circulations.

But reflecting worldwide supply chain issues, the company reported its printing and paper costs its printing and paper costs had risen by £300,000 year-on-year from £6.1m in the first half of 2021 to £6.4m in H1 2022.

Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) was up 28% to £5.9m and operating profit up 36% to £5.7m.

National World digital revenues

Digital revenue grew 41% year-on-year to £8.2m, £5m of which came from digital advertising, itself up 43%.

Digital subscription revenue grew 14% to £800,000 despite a decrease in digital subscribers from 20,000 to 19,000 between the end of December 2021 and the start of July. Average monthly page views across the half year stood at 15.6 million, and the company reported video revenue doubled in the year.

Buoyed by the digital drive, National World said: “At this stage, the board expects the business will perform in line with its expectations.

“As the group successfully implements its strategy, the board anticipates being able to initiate dividends at the time of announcing the 2022 full year results with a progressive dividend policy.”

National World print revenues

Print revenue, meanwhile, declined by £1m, or 3%, year-on-year. The drop was mostly accounted for by an 8% circulation decline; print advertising revenue grew by 1% year-on-year to £16.7m and overtook print circulation now on £16.5m.

The circulation drop was steepest in the second quarter of 2022, with a decline of 5% in Q1 and 11% in Q2. The company attributed this to “the impact of the slowdown in the UK economy in 2022 and marginally stronger comparatives as Covid-19 restrictions had been lifted in the second quarter of 2021”.

Average monthly circulation for H1 2022 stood at 1.9 million for dailies and 900,000 for weeklies, “representing an annual decline of 17% and 14% respectively”.

Print subscription revenue however declined by only 2% year-on-year to £1.5m. Print revenue in general continues to account for about 80% of the total for the business.

Printing costs escalate

National World said it incurred £6.4m in “newsprint and production costs” in the half year, an approximately 5% increase on the first half of 2021.

The increase, it said, reflected “a significant increase in newsprint prices and an increase in printing costs” – although the rises were offset “by a reduction in newsprint volumes” driven by “a reduction in circulation and reduced pagination”.

The company is not the first to declare major increases in printing costs recently: in its half-year results last week, Reach announced its newsprint costs had leapt 54% from £25.2m in H1 2021 to £38.8m in 2022 and this week it announced its plan to leave the free newspaper market in Manchester in part due to “the exceptional inflationary pressures impacting print”.

Contrary to its rising print costs, labour costs at National World dropped by almost 3% or £600,000 year-on-year in the half to £21.1m. Total employment dropped from 1,262 to 1,179 over the same period, a fall of approximately 6.5%.

Press Gazette reported in June that National World was cutting around 30 jobs around the UK, to be replaced with the same number of digital roles at its Metro World websites, for example London World and Manchester World.

Seemingly in reference to that redistribution of staff, National World chairman David Montgomery said in the results that the company’s “transformation is underpinned by re-skilling of the workforce to reduce dependency on news by widening the agenda with original content that can be monetised”.

And of the World division the results also said they target “the middle market metropolitan consumer, providing reliable content as distinct from the celebrity based red top market”.

However one insider at National World was unimpressed with the results, telling Press Gazette: “If you read between the lines of these results, it is clear that for National World to remain profitable in the future within its current business model, ownership will demand more from fewer staff, continue to prioritise clickbait over quality, and follow the model of other companies in keeping pay exploitatively low.

“Until the so-called investment results in growing rather than cutting staff numbers for existing titles, serious investment in quality digital infrastructure, and decent pay, David Montgomery will be the latest owner to fail readers and staff for a quick buck.”

A National World spokesperson declined to comment beyond the results.

Picture: National World

The post National World says profits up 60% in first half of 2022 amid digital ad boost appeared first on Press Gazette.