Trading Update November 27, 2020

RNS Number : 6932G Reach PLC 27 November 2020

27 November 2020 Reach plc ('Reach' or 'the Company') Trading Update

Digital drives performance ahead of 2020 market expectaons

Reach plc is today issuing a trading update for the 52 weeks ending 27 December 2020, covering the period from 29 June to 27 November 2020 ('the period').

Strong digital growth, resilient circulaon

Overall Group performance has exceeded market expectaons, with connued strong digital revenue growth of 16.2% for the five months to 22 November 2020, assisted by increased customer engagement.

Circulaon sales have remained resilient despite the recent lockdowns, supported by management acon on availability and increased cross-promoon of naonal and regional tles. Overall, for the five months to 22 November 2020, a decline in print revenue of 19.6% contributed to a Group revenue decline of 13.9%.

The Group expects these trends of strong digital growth and resilient circulaon to connue into December, while recognising that the current macroeconomic uncertaines make forecasng more challenging.

New, more efficient operang model

During the period, Group costs have been significantly reduced, underpinned by the transformaon programme. Given this cost focus and increasing digital contribuon, the operang margin in the second half is expected to be materially ahead of the first half. Having successfully implemented a strategic transformaon programme in the period, the Company has recently announced plans to consolidate its prinng operaons to achieve further efficiencies. A consultaon on these proposals, which would involve closure of two of its six prinng sites, is ongoing.

Connued good progress with new customer value strategy

Customer registraons have exceeded 4.25m, and the company is on track to deliver the 10m registraons it is targeng by of 2022. Reach retains its leading scale audience in the UK with 42.1m unique monthly visitors accessing its sites during October.

The strengthened customer and insight team connues to focus on the launch of the Reach ID, which is on track to launch in December as planned. This will unlock significant potenal in the form of customer insights that Reach can offer during 2021.

Acquision of remaining 50% in Independent Star Limited

The Group completed the acquision of the remaining 50% in Independent Star Limited on 24 November 2020. The addion of the Irish Star assets to the Reach porolio brings the number of it publishes in Ireland - North and South - to eight, plus one female lifestyle magazine (RSVP) and six online tles (Irishmirror.ie, Dublin Live, Cork Beo, Belfast Live, RSVP Live and Buzz.ie).

Posive balance sheet supported by strong cash flow

The Group has connued to generate healthy levels of cash during the period and is forecast to retain a strong posive cash posion at year-end despite incurring one off cash costs associated with the transformaon programme and other historical items.

Jim Mullen, Chief Execuve Officer of Reach plc, commented:

"The passion and talent of our people connue to take the Group and its news brands forward to its digital future. Reach has connued to deliver great content and connues to drive increased customer loyalty and engagement.

The headwinds from COVID-19 have been considerable, but while we remain mindful of potenal impacts from the current lockdowns, we approach the end of the year with a strong and growing digital business, resilient print circulaon sales, and a new, efficient operang model. Our customer value strategy is now entering a new phase, with an increased focus on business intelligence and insight. The launch of the Reach ID, which will deliver a single view of customer acvity across our naonal and regional network, is on track for December, and will provide enhanced data and insight that will support further digital revenue growth.

2020 has been a pivotal year for Reach and the response of our colleagues to the challenges of 2020 has been first-class. Whilst macroeconomic uncertainty remains, we approach 2021 with confidence in the long-term value of our loyal audience and trusted brands and with strong digital momentum."

-ends-

Note: Revenue trends on an actual and like-for-like basis are the same for 2020. The period relates to 29 June to 22 November 2020 with November represenng the latest esmate of revenues. Reach will issue its Annual Results Announcement for the financial year ending 27 December 2020 on 1 March 2021.

Enquiries Jim Mullen, Chief Execuve Officer Simon Fuller, Chief Financial Officer communica[email protected] Ciaran O'Brien, Director of 020 7353 4200 Communicaons Tulchan Communicaons David Allchurch / Giles Kernick [email protected]

About Reach plc

Reach plc is the largest commercial naonal and regional news publisher in the UK with a growing porolio in Ireland. We create engaging, differenated content which is distributed through newspapers, magazines and digital plaorms - playing a central role in our audiences' daily lives.

Our naonal and regional brands have a long heritage of being trusted sources of the latest news, on, sport and entertainment, offering a range of opportunies to connect brands with consumers. With one of the biggest monthly mul-plaorm audiences in the UK Reach's naonal and regional news brands are prominent champions, campaigners and changemakers.

For more informaon visit www. reachplc.com.

Conference Call A conference call for analysts and instuonal investors will be held today at 8.30am. You can join via conference call using the details below: 1. In the 10 minutes prior to call start time, call the appropriate Participant Dial-In Number listed in the Conference Dial-In Number section below. 2. Enter the Event Plus Passcode stated below and leave any information requested after the tone. You will be joined automatically to the conference.

Note: Due to regional restrictions some participants may receive Operator assistance when joining this conference call and will not be automatically connected.

Event Plus Passcode: 9697747 Participant UK FreeCall Dial-In Numbers: 0800 279 6619 Participant Event Plus Std International Dial-In: +44 (0) 2071 928338 Participant UK LocalCall Dial-In Number: 08444 819 752 For those of you unable to join the call on Friday, there will be a recording made available on our website in the coming days.

Forward looking statements This announcement has been prepared in relaon to the financial results for the 52 weeks ended 27 December 2020. Certain informaon contained in this announcement may constute 'forward-looking statements', which can be idenfied by the use of terms such as 'may', 'will', 'would', 'could', 'should', 'expect', 'seek, 'ancipate', 'project', 'esmate', 'intend', 'connue', 'target', 'plan', 'goal', 'aim', 'achieve' or 'believe' (or the negaves thereof) or words of similar meaning. Forward-looking statements can be made in wring but also may be made verbally by members of management of the Company (including, without limitaon, during management presentaons to financial analysts) in connecon with this announcement. These forward-looking statements include all maers that are not historical facts and include statements regarding the Company's intenons, beliefs or current expectaons concerning, among other things, the Company's results of operaons, financial condion, changes in global or regional trade condions, changes in tax rates, liquidity, prospects, growth and strategies. By their nature, forward-looking statements involve risks, assumpons and uncertaines that could cause actual events or results or actual performance or other financial condion or performance measures of the Company to differ materially from those reflected or contemplated in such forward-looking statements. No representaon or warranty is made as to the achievement or reasonableness of and no reliance should be placed on such forward-looking statements. The forward-looking statements reflect knowledge and informaon available at the date of this announcement and the Company does not undertake any obligaon to update or revise any forward-looking statement, whether as a result of new informaon or to reflect any change in circumstances or in the Company's expectaons or otherwise.

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