Telegraph falls to lack of £240m on account of loans to Barclay household ‘unlikely to be repaid’

The media group which owns the Daily Telegraph newspaper tumbled into the crimson final yr after it put aside practically £280m to cowl loans made to the Barclay household which will not be repaid.

The group stated that, regardless of a resilient monetary efficiency, it had made losses of £244.6m in 2023 – in opposition to income of £33.3m within the earlier yr – as a result of provision.

Telegraph Media Group accounts present {that a} £277.6m provision has been taken in opposition to quantities due from father or mother firm undertakings “with the continuing company transaction casting doubt over the recoverability of this stability”.

The Telegraph by itself web site reported that the availability had come on account of “loans extracted by the Barclay household that are unlikely ever to be repaid”.

The longer term possession of the Telegraph titles and the Spectator journal has been unsure since June 2023, when the titles had been seized by Lloyds bank after the Barclay family failed to repay £1.16bn in debts. The money owed had been later repaid by a UAE-backed consortium which had hoped to purchase the group however had been compelled to stroll away beneath political stress.

On Wednesday, the media firm stated in its 2023 accounts {that a} detailed evaluation of historic transactions had been undertaken in relation to quantities paid to and obtained from group corporations and associated events.

It stated this evaluation had “recognized potential irregularities within the recording of such transactions” and stated that, though there had been no adjustments to belongings and liabilities, there was “a possible danger of future potential compensation claims in opposition to the corporate and group in respect of such transactions”.

The Telegraph’s 2023 losses got here because the group reported it had surpassed 1m subscriptions in August 2023, with subscriptions throughout Telegraph Media Group rising from 734,000 in December 2022 to 1.03m in December 2023. The biggest contributor to the subscription enhance got here from the £13m acquisition final yr of Chelsea Journal Firm, a writer of client titles together with Basic Boat.

Turnover elevated to £268m in 2023 in opposition to £254.2m in 2022, largely as a result of development in digital promoting and partnerships in addition to digital subscriptions, it stated.

Anna Jones, chief govt of Telegraph Media Group, stated that 2023 had “strengthened the energy and resilience of Telegraph Media Group as a enterprise”, including: “The substantial development in our working revenue pre-exceptional objects final yr was pushed by vital advances in each digital promoting and digital subscription income.”

The Barclay household, which bought the Daily Telegraph in 2004, stated: “The Barclay household is happy with its monitor file of funding in Telegraph Media Group, which beneath its possession has been reworked right into a profitable digital and print media model, with over 1 million subscribers.

“All through the household’s possession the enterprise has been managed responsibly and inside all authorized frameworks, with all accounts permitted by auditors.”

The newspaper group is up on the market after the UAE-backed consortium walked away from its £600m planned deal to buy the group in May, saying that new laws which blocked foreign-government-backed entities from proudly owning British media teams meant the deliberate transaction was “now not possible.”

The choice in Might by RedBird IMI, a partnership backed by Sheikh Mansour bin Zayed al-Nahyan, the UAE’s vice-president, and the US funding agency RedBird Capital Companions, fired the beginning gun on an public sale course of for the newspaper group which is broadly seen because the in-house journal for the Conservative occasion.

Bidders within the public sale, which is being run by the banks Raine Group and Robey Warshaw, are anticipated to incorporate DMGT, which owns the Day by day Mail, and Paul Marshall, the hedge fund founder and backer of GB Information. Information UK, owned by Rupert Murdoch, has proven curiosity within the Spectator journal.