The group has committed £80m to investment in new presses to print its national newspapers in the Berliner format, as well as £24m for new presses for its Northern local newspapers business.
The Guardian's format switch was brought forward by a year to this autumn, as management reacted to the daily's circulation slipping in comparison with earlier switchers The Independent and The Times.
The scale of the investment masks an impressive increase in turnover of 18% to £751.9m, which shows GMG's purchase of Trader Media in 2003 continuing to pay off.
Increased losses at The Guardian and The Observer, from £6.2m to £18.6m, were offset by the performance of Trader Media, the owner of Auto Trader.
Trader Media grew its turnover by 15% and was able to reduce the debt GMG took on to finance its purchase ahead of schedule.
Sir Robert Phillis, GMG chief executive, said: "While the scale of our investment programme means that profits after amortisation and exceptional items are significantly lower this year, Trader Media's outstanding financial performance has allowed us to reduce borrowings well ahead of expectations."
Phillis added that the short- and long-term outlook for newspaper advertising was challenging.
"The display advertising market continues to be tough for newspapers, particularly the qualities, as trading conditions have tightened. Bias towards traditional media is slowly being eroded through the proliferation of channels and the growth of consumer-centric planning," he said.
GMG Radio moved into operating profit for the first time with a positive contribution of £1.5m after a previous year loss of £2.1m. Operating profit before accounting for digital operations stood at £3.5m.
The Guardian Unlimited website saw 10m unique users each month visiting the network of sites, with more than 100m page impressions. Year-on-year display and sponsorship revenue rose by 36%, the third year in succession to see a revenue increase of more than 30%.
If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the .
.jpg)
.jpg)