Unaudited half-year results for Bermuda Press Holdings Ltd show depressed operating revenues of nearly 6 per cent compared with the first half of the 2022 financial year.

For the six-month period, profits for the parent company of The Royal Gazette decreased significantly.

BPHL noted that the cost of a legal battle together with the difficult economic times were major factors.

In a letter to shareholders, the board of directors reported that the company’s operating revenue decreased 5.9 per cent to $9,542,000 for the six months ended March 31, compared with $10,138,000 for the same period in 2022.

They described management efforts to navigate the company through the challenging economic environment faced by Bermuda, which they said included a strained and diminished local economy as well as soaring inflation.

The statement read: “As a service provider, the squeeze felt by our customers ultimately affects our own businesses. Management has continued to make changes within your company’s operating business units to maintain profitability through the first six months.

“Profitability for the six months ended March 31, 2023 was $33,000, compared with $190,000 for the same period in 2022, a decrease of $157,000.

“This decrease is mainly due to the decline in revenues that were partially offset by a reduction in expenses. The company has continued to experience an increase in the cost of doing business in Bermuda due to the rising cost of materials, supply-chain disruptions, as well as staffing and recruitment related costs.

“In addition, The Royal Gazette has continued to incur significant legal costs in its continuing defence of the public’s right to know and the media’s ability to report on information in the public domain.

“These legal costs mainly relate to a lawsuit by Evatt Tamine seeking to suppress The Royal Gazette’s reporting on his involvement in billionaire Robert Brockman’s alleged tax evasion case in the United States.

“Through the first six months of 2023, the company incurred $85,000 in legal fees, with additional costs to be incurred in the second half of FY23.

“While it is painful to bear these costs during this economic downturn, the board feels it is an important obligation to protect the free media in Bermuda.”

Key financial highlights for the first six months include:

• Publishing revenues for the first six months decreased 5.2 per cent, or $290,000, over the prior period. The publishing unit continues to be affected by the decline in demand for print advertising. Most segments of the local economy, excluding international business, have struggled to recover financially from the effects of the pandemic. In response to declining print revenues, the publishing unit continues to expand its digital product offering and to enhance customer and reader engagement

• Retail and office equipment revenues for the first six months decreased 14.5 per cent, or $249,000, over the prior period. There were challenges with inventory procurement and rising costs, remote work reducing the need for office equipment, and increasing overseas purchases by residents that compete with local retailers

• Commercial printing decreased 2 per cent, or $29,000, over the prior year. The commercial printing division continues to be significantly impacted by the ailing Bermuda retail and hospitality sectors, as well as corporate sustainable initiatives, which have decreased demand for printed materials

• The company’s local real estate holdings remain the most profitable segment with an overall occupancy rate of 95 per cent at March 31, of which 54 per cent is occupied by third-party tenants

Other key highlights since the annual report include:

• The Royal Gazette continues to evolve with its “Digital First” initiative, investing in the people and systems required to meet the Digital First challenge. The success of this remains a top priority to ensure The Royal Gazette maintains its place as the leader of independent journalism in Bermuda in an increasing digital world

• The Royal Gazette is in the final stages of releasing a new subscriber system for its digital content as it transitions from a traditional advertiser newspaper model to a journalism supporter model.

• See letter to shareholders in “Related Media”

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Bermuda Press Holdings - 2023-06-28 - Interim Report.pdf