Connect Group’s Smiths News division has secured a new five year deal with magazine distributor Frontline, bringing further signs of an upturn in the group’s fortunes.

The £750m deal closely follows the renewal of its contract with News UK in July. It will see Smith News continue to deliver Frontline’s 40% share of the UK magazine market. The renewal of the two contracts amount to 30% of Smith News’ sales revenue.

The Frontline deal brings much needed positive news to the group in a year which has seen the departure of chief executive Mark Cashmore on the back of a profit warning in June, the closure of the group’s Pass My parcel division and a trading update in September warning that the group’s full year trading performance would be “below expectations”.

The trading update, to 31 August 2018, had warned that the group’s performance had been hit by further falls in magazine sales, disappointing sales of World Cup related products and challenging conditions in the parcel freight market, undermining Tufnell’s second half performance this year.

The update also highlighted a £1m-£1.5m provision relating to the “misapplication” of minimum wage legislation and a £1.5m fine following the death of a driver at the group’s Tufnell division in 2016.

Jos Opdeweegh, Connect Group chief executive officer, welcomed the new agreement with Frontline. He added: “Long term partnerships are central to our business model, allowing us to drive efficiencies and deliver great service for publishers, retailers, and ultimately for millions of consumers across the UK."

Opdeweegh, who replaced Cashmore in September, is currently leading a review of the group’s strategy and overseeing the ongoing restructuring of the business to deliver greater efficiencies.

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