Telegraph Media Group has reported a record £244.6m loss in 2023, despite a 35% rise in operating profit.
The business said in a statement released about its 2023 results that the loss was the result “of a provision of £277.6m being recognised against amounts due from TMG’s parent undertaking”. In accounting a provision is a liability — i.e. a debt — the timing and size of which are uncertain.
The company said that a “detailed historic review” of TMG, carried out as part of the Telegraph sale process, had “identified potential irregularities” in transactions between the group and other parts of the Barclay empire.
“Although there have been no changes to the assets and liabilities recorded, there is a potential risk of future possible repayment claims against the Company and Group in respect of such transactions,” the company said.
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Turnover at Telegraph Media Group grew £13.8m to £268m, representing a 5.4% increase. Operating profit excluding-exceptional items — including the £277.6m provision — rose from £40.1m to £54.2m, a 35.2% increase.
The company said the growth was “driven by the growth in digital advertising and digital subscription revenue”.
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TMG did not break out its print subscription revenue, print advertising or newsstand sales figures, but said that digital revenue growth “is significantly outpacing decline in print”.
Overall subscription numbers continued to grow following the August announcement that the company had passed one million subs. TMG ended 2023 with 1,035,710 subscriptions, including more than 200,000 that were added with the company’s acquisition of the Chelsea Magazine Company.
TMG chief executive Anna Jones said: “Against a backdrop of uncertainty surrounding its future ownership, the business has continued to excel…
“Our quality journalism continues to underpin the success of the business and support its underlying financial health…
“As we look ahead we will continue to invest in expanding our audiences and evolving our products, specifically across audio and the app, to best serve our dedicated subscriber community and secure continued growth through 2024 and beyond.”
‘Loans extracted by the Barclay family unlikely ever to be repaid’
The company’s report does not discuss the “potential irregularities” in detail, but The Telegraph’s own story about TMG’s results reports that the financial "black hole" is the result “of loans extracted by the Barclay family which are unlikely ever to be repaid”.
The loans, it says, include “more than £200m extracted as loans on annual amounts in the tens of millions”, and attempts to trace the money across the famously complex network of the Barclays' businesses had been unsuccessful.
The Telegraph reports that specialists from HMRC and the National Crime Agency have been in contact with TMG, and that the ���future possible claims against the company” alluded to in the annual statement “include a potential claim of tax fraud from HMRC and a potential claim by the current directors against the previous directors”.
The paper also reported that advisory and other fees connected with the sale of The Telegraph cost the business approximately £22m, £10m of which was paid to Goldman Sachs to prepare the auction process that was ultimately short-circuited by Redbird IMI.
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