Reach (RCH) H1 2026 earnings summary

Executive summary

• Adjusted operating profit reached £43 million for H1 2026, with strong cash conversion at 113% and disciplined cost management.

• Revenue declined 9% year-over-year to £233 million, with digital revenue down 11.4% and print revenue down 8.3%.

• Digital revenues fell due to a 40% drop in on-platform page views, mainly from lower Google referrals, but direct digital revenues (excluding local) grew 6%, supported by video and subscriptions.

• Strategic focus on connecting with audiences, accelerating tech and AI adoption, and diversifying revenues, including over 40,000 digital subscribers and new AI licensing deals.

• Interim dividend rebased to 1.44p per share to prioritize organic investment and financial flexibility.

Financial highlights

• Adjusted operating profit of £43 million, down 4% year-over-year, with margin improved to 18.5%.

• Adjusted EPS rose to 11.1p; statutory EPS fell to a loss of 8.2p due to non-cash impairment and restructuring costs.

• Operating costs reduced by over 10%, exceeding cost-saving targets.

• Net debt increased to £47.5 million, with leverage at 0.4x EBITDA and a £145 million revolving credit facility in place.

• Adjusted operating cash flow of £49 million; pension payments totaled £28 million in H1.

Outlook and guidance

• On track to deliver profit in line with market expectations for FY26, despite revenue headwinds.

• Cautious outlook for H2 2026, expecting around 10% operational cost savings and continued industry headwinds.

• One-off cash cost of £25 million for print site closures expected in 2026.

• Pension contributions to step down materially in 2028, increasing future capital allocation flexibility.

• Margins during the bridging period not expected to exceed 20%.