How failing magazines drove a 3,800% return for the shareholders of this British publisher


The CEO of Future Media used cost cutting and online sales to boost the company’s inventory, in what now looks like a playbook for the entire magazine industry.

TThe London offices of Future Plc. are at the end of a decidedly old-fashioned cul-de-sac in West London, flanked by a few inexpensive hostels. Inside the chunky white building are rows and rows of cheap particleboard desks, all empty. Eighteen months after the start of the pandemic, many of the company’s 2,500 employees are still working remotely to publish 80 amateur magazines ranging from Guitarist and PC player To Radio world and Monthly Golf. But the boardroom, where CEO Zillah Byng-Thorne holds court, is lined with garish black and red leather gaming chairs at $ 200. “We released them from one of our events, and I thought we could have them in our office,” Byng-Thorne said with a shrug.

Byng-Thorne knows a lot about the penny pinch. The 46-year-old landed as CEO in March 2014 after her boss was ousted by investors when the market cap of a debt-ridden Future collapsed to just $ 40 million and earnings plummeted. dropped to $ 103 million. “The company was going bankrupt,” she says. “The shareholders were exceptionally supportive, but I had to say ‘I have no idea what’s going on. Give me a year.

In his first six months at the helm, Byng-Thorne cut 400 jobs, around 40% of his staff, moving jobs from San Francisco to the West of England “at low cost”, and sold a lot of 17 magazines, including the popular title. Procycling for $ 36 million. “Unless you put out the fires, you have no right to think about what you are doing [next] as a business, ”says Byng-Thorne.

Since then, Byng-Thorne has turned Future into a digital content powerhouse with a profit of $ 95.7 million last year on sales of $ 451 million. The stock price rose 3,821% in just over six years, resulting in a market cap of $ 6.3 billion. Byng-Thorne broke Future’s dependence on newsstands and advertising and refocused the entire company on events, data, and most importantly, e-commerce. About a quarter of Future’s income comes from what is known as “affiliate marketing”. Basically, it’s the commission – sometimes up to 8% – that Future receives when a reader clicks to buy a gadget on Amazon after reading a TechRadar review. All major media brands, from New York Times To Forbes, has dabbled in the affiliate marketing sandbox, but with his portfolio of product-focused publications, Byng-Thorne has been able to cash in better than most.

“There are very few companies that have shown their ability to monetize ezine content and Future does it much better than anyone,” says Mark Slater, co-founder of Slater Investments, a London-based fund that manages 2, $ 5 billion and a major shareholder of Future. “This focus on customers with the intention to buy is very, very distinctive and there aren’t a lot of companies like it.”

Byng-Thorne, who is an accountant by training, had a knack for financial RCP since stepping into the management ranks of two struggling UK companies: the Threshers liquor chain and the Waterstones bookseller. But, before Future, his only media experience was as the interim CEO of an auto classifieds magazine called Auto Trader. It canned the bulky print magazine, deleted jobs, and accelerated its predecessor’s mobile-focused strategy. “It was pretty much the model of a digital printing company,” says Colin Morrison, a longtime media executive who is the founder of the Flashes & Flames blog.

Byng-Thorne’s Auto Trader strategy paid off when the company went public in 2015 for $ 3.5 billion. But she did not share the success, having left the company in 2013 after being dismissed from the post of permanent CEO. “It was a personal disappointment for Zillah and I think Future was all about it. She’s very, very successful,” says one of Future’s institutional investors.

Having cracked the print-to-digital code, at least for home magazines, Byng-Thorne has been busy using her suddenly precious stock to buy more. Since 2016, she’s spent $ 1.91 billion on 21 transactions for dozens of titles. More recently, in August, she acquired Kiplinger’s personal finances, The week and 10 other titles from Dennis Publishing, the former lad-mag giant responsible for Maxim and Thing, for $ 415 million. As one of the few buyers of unloved printed assets, Byng-Thorne can make a tough deal, and his expertise in cutting costs makes every transaction even more enjoyable.

“When Zillah looks at acquisitions, she’s very strict on the price,” says Slater. “There was a golf magazine, Golf Digest, which Discovery bought for $ 30 million, Future offered $ 2 million for example.”

This rapid-fire deal made Future a target for London hedge fund Shadowfall in 2020, which called it a collection of “low-quality, often segregated and shrinking assets.” The attack was pushed back, but its biggest deal, a $ 795 million takeover of auto insurance quote website GoCompare in November, rocked investors. But Byng-Thorne isn’t backing down: if Future can be the trusted guide to buying headphones, why not auto insurance? “More and more people are not looking for the cheapest, they are looking for the best. They want someone to help them figure out what to buy, ”she says.

Napoleon glares at the boardroom screen (that’s the cover of a Future story magazine) as Byng-Thorne describes his next campaign – attracting more American readers and online sales. Future has carved out a profitable niche for itself in sports, music, and technology, but is now actively seeking acquisitions in women’s lifestyle and home decor. It means challenging America’s printing powers Hearst, Meredith and Conde Nast on their turf, a strategy that just seven years ago would have seemed so unrealistic as to be inconceivable.

“Sometimes I would come home at night thinking I had enough money to pay the payroll.” Byng-Thorne remembers. “Suddenly I wonder how do we reach one in three people in America.”


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