Smiths News’ annual revenue is down 10.7% year on year, as a result of the coronavirus pandemic, according to the company’s latest quarterly financial results.
The wholesaler’s operating profit has also decreased 19.5% year on year, while staff numbers have been cut by 10% this year alone.
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Despite the results, the wholesaler said it’s ahead of revised coronavirus expectations and sales of newspapers and magazines have recovered, down 7.5% and 9% year on year, respectively, after hitting lows of up to 50% decline in April.
Despite receiving £1.3m in furlough funds for 550 employees, the wholesaler’s staff count fell nearly 10%, a net loss of 517 staff.
Chief executive Jonathan Bunting said: “Inevitably, our financial results were impacted by Covid-19, but we have seen a gradual recovery with good momentum in the last quarter, demonstrating the resilience of our markets, our business model and our people.”
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The wholesaler also revealed a number of cost-saving exercises, which led to an £8m saving.
This included “network optimisation”, cost savings related to retailers using its app instead of calling its helpline, a “final-mile vehicle strategy” and introducing more efficient, smaller tote boxes.
Bunting told shareholders Aldi’s decision to exit the newspaper and magazine market last year had cost it £2.2m in annual revenue, but also hinted at new partnerships with multiples related to its ‘Rascal’ automated magazine returns system, thought to be Sainsbury’s and WHSmith.
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