The Press Its mission is to provide quality information accessible to all. And if we succeed every day in informing you about the subjects that affect you, in a factual and rigorous way, it is among other things thanks to all the actors who support us. Thus, our advertisers contributed to a 9% increase in our advertising revenues, and 48,000 of our most loyal readers donated to our news media for a total of nearly $7 million raised in 2022. So As 2023 begins, we would like to share with you our review of the past year as well as some of our achievements.
In 2022, our journalists have been your eyes on the ground covering stories across the country and around the world. They have done a long job of bringing you several impact stories like our hard-hitting digital story on overdoses, or our special edition on real influencers. The Press accompanied you in your daily challenges. Thus, our extended team of journalists dedicated to purchasing power has delivered comprehensive coverage of economic news, personal finance and the grocery basket. The objective: to help you better understand the impact of the current context of inflation on your lives and to make wise choices, thanks to analyses, reports, files and guides that challenge you.
In 2022, new newsletters were set up, including money and happiness and The positive angle. A new feature was also launched in the fall on our mobile application to allow you to quickly and easily find the essential content of the day and week. Always keeping in mind the fact of allowing everyone to have free access to quality information, we are developing new initiatives for the distribution of our content in order to reach the greatest number of readers and to adapt new information consumption habits.
Through his opinion pieces, The Press allows you to feed your reflection on our world. This year, in order to reflect the major currents of thought that occupy the public square, we have added even more diversity of opinion to our screens. New feathers have thus joined our team, including Régis Labeaume, Maxime Pedneaud-Jobin and Mariana Mazza. Several opinion letters from our readers have been regularly published to enhance the debate of ideas.
Our financial results
Independent, without commercial shareholders, La Presse evolves in a non-profit structure. Its profits are entirely reinvested in the mission and the organization. La Presse is a company that has completely transformed over the past 10 years. We have implemented a model based on the diversification of our revenues, which aims to ensure our stability and our development in a constantly changing industry. Our revenues are largely made up of advertising and donations from individuals, foundations and corporations. La Presse also benefits from government programs accessible to all industry players, including tax credits on editorial payroll.
Our transformation has led us to make strategic choices that today allow La Presse to obtain a positive balance sheet for the third consecutive year, a sign that our business model is working. As we have just ended the fiscal year, we expect to record a net profit of $11 million*. In addition, in 2022, we set up a reserve fund with an initial investment of $25 million, to which we plan to add nearly an additional $12 million this year from our cash.
La Presse wishes to thank its readers, advertisers, donors and employees, who participated in its success. If La Presse is a profitable company capable of reinvesting in its mission, it is thanks to sound management of expenses, linked to the considerable efforts of our teams and to responsible decisions. It is also thanks to increased competitiveness in the advertising market as we continue to innovate to meet the needs of advertisers. And finally, it is also thanks to the essential support of our donors, who contribute to giving this free access to 4 million readers who join our platforms each month, or around 60% of the adult population of Quebec.
Donations
Since the launch of our philanthropic program in 2019, 77,000 people have donated to La Presse for a total of nearly $21 million raised. And in 2022, we benefited from the generosity of 48,000 donors, for a total of $6.9 million. The entire La Presse team would like to thank all of its donors who, through their generosity, allow everyone to have access to in-depth reports. Thank you, dear donors, for continuing to support us. We couldn’t have made it without you.
Advertising revenue
The good financial results that we are communicating to you today are also due to an increase in advertising revenues, which remain our main source of funding. While the domestic media advertising market was down after the first three quarters of 2022, we saw a 9% uptick for the year.
These exceptional results demonstrate La Presse’s leadership in offering its advertisers products that meet their needs and remain a leader in the digital market in Canada. We are grateful for the confidence shown by our business partners in our brand and the rigor of our information media, and thank them for having chosen to invest in local media.
The key to caution
The 2022 surpluses will mainly be reinvested in our reserve fund, which we have set up to ensure the sustainability of our institution. History in the media environment allows us to anticipate that the effects of a recession could cause a drop of 15 to 25% in our advertising revenues over a period of three to four years, depending on the extent of the crisis. Our objective is therefore to accumulate a sufficient amount in this fund, greatly exceeding the current balance, to enable the continuation of our activities without being put at risk by economic fluctuations or major technological changes that are increasingly complex. and expensive to make.
This strategy is similar to that of other media around the world, such as the Guardianwhich today has a considerable fund of nearly £1 billion (C$1.7 billion), which allows it to reinvest in its content, multiply its impact in society and secure its future.
Remember that La Presse is now flying on its own, in an industry undergoing profound change and in a competitive environment dominated by web giants as well as major integrated players such as Rogers, Bell and Quebecor. It must therefore, as a responsible company, without commercial shareholders and without the means of these major competitors, increase its reserve fund.
As we have done in recent years, we continue to demonstrate strong governance with, for example, compensation based on comparable market medians in Canada for similar positions, applying to all our employees. , including executives, and members of senior management. We also ensure that a portion of the donations are reinvested each year in our information mission while maintaining close management of our operational costs.
Update on Bill C-18
In closing, it is important to take stock of the Federal Online News Bill (C-18), inspired by Australian legislation. It aims to establish a framework regulating digital giants who benefit from content for which they do not pay. The aim is to strengthen the balance of economic relations between news companies and online platforms, strengthening our negotiating position against these large digital news intermediaries which dominate the market.
Bill C-18 has not yet been passed by the Senate. Moreover, the negotiations that will follow will certainly be long and difficult. Although we are realistic about the amounts that we will be able to obtain with this eventual commercial agreement and the modest share that they will take in our overall revenues, it is important to add these new revenues to those that already exist. We have been waiting for them for too long already, we and all the news media in the country.
A new Year
We are starting 2023 with the same desire to surpass ourselves and provide you with quality information free of charge. We want to continue developing our content offering and our products, in addition to thinking about the next key steps for the success of our organization. To do this and to face the challenges that await us, we are counting on your commitment, as readers, donors and advertisers. You are essential pillars to the sustainability of our institution. The continuation of your support is essential so that we can continue to be part of your daily life, to inform you, to nourish your reflections.
*Excluding actuarial revaluations with no impact on cash