Tortoise Media, which has agreed to buy the Observer newspaper, has reported a smaller annual loss after reducing spending and cutting some staff.
The podcast, newsletters and live events company reported a loss before tax of £3.8m for 2023, down from the previous year’s loss of £4.6m. Turnover fell slightly to £6m, down from £6.2m, amid “consumer and corporate hesitancy”, according to accounts filed with Companies House.
The improved financial performance resulted from streamlining its live events programme, reducing its editorial and production workforce and offering voluntary redundancy, the company said. The number of staff working in editorial and production fell to 44, down from 52, administrative and support staff reduced to six from eight people, and commercial staff rose to 14 from 12.
Tortoise was launched in 2019 by James Harding, a former editor of the Times and former director of news at the BBC, and Matthew Barzun, a former US ambassador to the UK.
Tortoise said 2023 was a “challenging year for consumers and as a result the competition for news and information subscriptions were hard fought” with alternative sources posing a “significant threat to quality journalism”. It said its mixed business model meant it was “well placed to adjust to changes in consumer behaviour”.
Tortoise said it incurred one-off redundancy costs of almost £520,000 in 2023. It also made share awards to high-performing employees totalling £321,545. Directors’ total remuneration, including pension contribution, fell to £416,000 from £598,000.
The company said it reported cumulative losses of £20.3m, which could be offset against future profits to reduce its tax bill.
This year, it raised £2.7m by issuing shares and convertible loan notes and secured further equity funding to support the acquisition of the Observer, it added.
Tortoise said it would invest £25m and “combine its digital newsroom with that of the world’s oldest Sunday newspaper, adding significant new editorial resources to the paper on a Sunday and building a daily digital Observer that includes podcasts, video, newsletters and a new website”.
The first Observer under Tortoise ownership is expected be published in the spring.
The Scott Trust, the ultimate owner of the Guardian and Observer, announced earlier this month that a deal to sell the Observer to Tortoise had been agreed in principle. The trust is investing £5m in Tortoise Media and taking a 9% stake in the business. It will also take a seat on the editorial and commercial boards of the media company.
Journalists at the Guardian and Observer who are members of the National Union of Journalists went on strike for four days spread out over two weeks over the proposed deal, which they fear could lead to job losses and affect the Observer’s editorial independence.
Staff have been told there will be no job losses as a result of the deal. Observer staff have been told they can also opt to take voluntary redundancy on enhanced terms. If they transfer to Tortoise, their existing terms and conditions will be honoured.
Tortoise said it broke even in the fourth quarter of 2023, adding that it accepted revenue last year would stay roughly flat year on year after dropping some lower-profit events.
Source: theguardian.com
