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DC Thomson offloads Aceville

Seven weeks after UK newspaper group DC Thomson announced it was closing the Essex-based Aceville Magazines, the brands of the lossmaking company have been acquired by the Enthuse Group. The privately-owned, specialist publisher expects to continue publishing at least 12 print and online brands and to save around 30 jobs from the previously announced redundancy programme.

The financial terms have not been disclosed.

The Scotland-based publisher of The Beano children’s comic, newspapers including the 275-year-old Aberdeen Press & Journal, the Sunday Post and the Dundee Courier, and the magazines Stylist, and Puzzler Media, had said it planned to cut 300 (19%) of its workforce and to close almost 40 magazines. The economic downturn had forced the family-owned company to “reset” the business “to focus on high growth and sustainable growth”. It aimed to cut annual costs by £10m, possibly equivalent to the 2021-22 increased costs of fuel and paper. 

Almost 50% of the 300 potential job losses were at Aceville which DC Thomson had acquired for a total of £3mn in 2018.

It had claimed that Aceville was ”one of the fastest-growing publishing houses in the UK and home to over 40 brands including the leading UK-based craft titles to gardening, health and food publications. …We’re excited to have acquired Aceville and are looking forward to working together…This acquisition firmly establishes DC Thomson Media as one of the top 5 consumer magazine publishers in the UK.”

The relatively modest purchase price belied the bold claims made about Aceville. It employed 150 people (most of whom began their careers with the company) and always seemed like an odd acquisition for DC Thomson. But it seemed to like Aceville’s under-the-radar performance because its own success had so often been under-estimated by the London media market 500 miles from its headquarters in Dundee. 

Nevertheless, DC Thomson’s claim that adding Aceville’s then 40 relatively small magazines made it one of the UK leaders “by number of magazines” was a curious one. The subsidiary, whose one-time £15mn revenue had fallen to some £10mn by 2022, is believed to have been loss-making since acquisition.

In the year ended 31 March 2022, DC Thomson’s “media revenue” was £156mn (2021: £146mn), some 50% from circulation and 25% from its Findmypast genealogy service. After a decade of abortive international investments, the company’s business is now mostly in the UK. But its total revenue of £174mn (£160mn) included a dividend income of £17mn which reveals the almost hidden story of a company with an investment portfolio worth almost £900m – much more than the value of its publishing assets.

It invests variously in listed companies, in funds operated by its Dundee neighbour Alliance Trust (in which Thomson itself is a longtime shareholder), and in a clutch of startups. It is this investing which consistently funds a generous annual dividend for family shareholders – £22.2mn in 2022. In that sense, DC Thomson is more an investment company than a media group. But, over the years, investing in its own and other people’s media has delivered good returns.

Commenting on the Aceville acquisition, Owen Davies, the owner of Enthuse (which has a portfolio of 30 magazines and associated websites and events), said: “I have been working with DC Thomson night and day to try and find a way of saving at least some of the Aceville business. I realise that the expectation of saving only around 30 jobs is a small consolation to all the people affected by the closure and I will continue to discuss all options in consultation with employees.”

Enthuse Group had 2021 revenue of £15.2mn with an operating profit of £2.1mn and principal brands including: HiFi Choice, Match Fishing, Stamp, and The Woodworker. It is a JV partner in AA Media together with the UK motoring services company, The AA. It employs some 80 people and derives over 25% of revenues from its US media businesses. It has previously acquired magazine brands from IPC and Future. 

Davies, who co-founded Enthuse (formerly My Time Media) in 2005, was previously Finance Director of Northcliffe Newspapers and Managing Director of Electronic Media for DMGT. 

Enthuse Group