The publisher of the Economist has announced a 6 per cent increase in operating profits, due largely to a surge in advertising revenue associated with a growth in digital subscriptions. The news will likely please other publishers as the sector as a whole looks for new methods to increase profits in a time of dwindling readership and lack of growth.
The Economist Group is part owned by Pearson, publisher of the Financial Times, which holds a 50 per cent stake. In addition to the increase in digital-only subscriptions, growth in print subscriptions helped push circulation figures up by 3 per cent in the first half of 2011. As a result, the combined advertising revenue from print and digital subscriptions grew by 12 per cent.
The economic turbulence in the Eurozone and the continued threat of a second global economic recession will have done little to harm readership of the publication. John Micklethwait, editor-in-chief since 2006, explained the growth by explaining that continued technological advances particularly in relation to the proliferation of tablet computers and e-readers, helped the publication to "play to its strengths."
As well as the rise in digital only subscriptions the publisher last November launched a mobile subscription service with apps for Apple devices. The Economist has said that its app has had 3 million downloads so far.
"We are discovering great opportunities in digital," said Andrew Rashbass, chief executive of Economist Group. "For us, as for many publishers, digital is not a zero-sum game."
The company has also reported that unique visitors to the Economist website are up to 7 million, representing a 45 per cent year on year increase.