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Guardian Australia rejects The Australian’s claims it has two years to prove commercial viability

guardian australia logoGuardian Australia has rejected suggestions by rival publication The Australian its losses “have blown out to $14m”, stating it has in fact had a “revenue increase of 64 per cent last year”.

On Monday The Australian’s media section reported financial accounts for the 12 months ended June 30 showed the losses for the local operation of The Guardian were up from $6m in the prior corresponding period.

The Australian’s report stated: “Journalists, overheads and traffic-acquisition costs are pushing up operating costs as digital ad rates fall through the floor.”

In a follow-up report, The Australian said the digital publication had two years “to prove itself commercially viable before a multi-million-dollar loan is called in”. That loan is held by businessman Graeme Wood.

But Guardian Australia has rejected the claims in a statement this afternoon saying: “There is no specific timeline for the debt to be repaid”.

“Guardian Australia is owned by GMG and The Scott Trust, which has assets of over $2bn. We have external financing to fund the start up costs of the Australian venture. The investor has no equity, board seat or say in the operating of the business,” the company said in the statement.

“Our mission is to build a sustainable business in Australia, with Australian staff and paying Australian taxes. The business is currently on plan and has exceeded the expectations of the original plan.

“The overall financial stability of the group has allowed the Guardian to make vital investments in our digital products, our global expansion, local editorial teams, native advertising, data and programmatic capabilities.

“Our ability to make these investments at this time puts us in an extremely strong position compared with some local competitors,” the statement concluded.

McClelland

McClelland

Speaking at an event today in relation to a question on what is expected in the year ahead, Guardian Australia managing director Ian McClelland said the company would be looking to diversify its business more.

“We are going to focus on creating non-advertising based revenue streams, that’s a sensible thing to do to diversify the business more. The benefit of doing that is great first party data collection, that’s a great way to do that. In the UK we have jobs classifieds, dating services, we have all these amazing things that collect data. We have some in Australia but we want more,” he said.

“I’m starting to see this always on partnership with clients rather than a campaign mentality. As they move to become more like publishers and creating content and managing and owning communities, they’re waking up to the fact that this is a 24/7 business. We’re in a brilliant place to help them achieve that.

“And recruitment, recruitment, recruitment. Still more people to go, 15 I can see at the moment,” he added.

 

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