Condé Nast Ƶ, renowned for revered publications such as Vogue and GQ, has reported a pre-tax profit slash amid soaring costs.
The publishing powerhouse's profits plummeted to £8.3m in 2023 from £23.3m the prior year, with Company House filings showing a marginal dip in turnover from £247.9m to £244.8m, as reported by .
The company conceded: "Whilst revenue remained flat year-on-year, costs to the business increased."
Condé Nast attributed a part of these cost surges to strategic investments in growth areas, noting: "Many of these operating cost increases were driven by the group’s investment in strategic growth areas."
This encompassed rises in expenditures on paper, printing and carriage, manufacturing for consumer products, events' infrastructure, and departmental staffing. As part of their burgeoning workforce strategy, Condé Nast disclosed an editorial team boost of 3.5% and amplified its commercial division by 4.5%.
In a geographical breakdown, Condé Nast witnessed its Ƶ turnover recede from £93.1m to £89m, whereas European figures declined from £132.2m to £119.2m. Contrastingly, the rest of the world's sales swelled from £28.8m to £36.6m.
On the advertising front, there was a downturn from £211.8m to £200.5m, though revenue from consumers and other sources modestly rose from £42.3m to £44.2m.
Condé Nast looks to make further ‘cost efficiencies’
These revelations follow shortly after the disposal of Vogue House in Hanover Square, London, which concluded in January 2024 for £74.9m, yielding a robust profit of £62.4m.
A statement from the board highlighting robust performance read: "The group has maintained sustained audience growth and, in accordance with its strategic plan, the business will continue to invest in its strategic areas including digital content, video output and growth of consumer revenue programmes."
It went on to emphasise the strengthened position due to diverse revenue streams and a unified management structure: "The group now also has additional diversified revenue streams, a cohesive management structure and support mechanisms for its operations including shared business services with Condé Nast global headquarters."
The statement was optimistic about future prospects, citing new consumer revenue avenues as key factors: "Consumer revenue sources such as e-commerce, increased subscriptions and additional direct-to-consumer programs are expected to be drivers for future growth at the group."
However, it also acknowledged potential obstacles in the current financial climate: "Whilst the current macroeconomic challenges in the fashion and luxury sectors could present some headwinds to growth as advertisers take a cautious approved, the new global content strategy is expected to streamline operations and ensure the additional cost efficiencies can be realised."
Finally, the statement noted the positive impact of the new operational model: "To reflect the impact of the new globalised operating model and the functions performed by the European operating companies, the group now realises greater financial strength and stability given the diversity of businesses operating together."
