NWSA News Corporation

The British newspaper the Guardian announced Monday that it will cut its budget by 20% over the next three years in an effort to reduce losses amid a sharp decline in print advertising revenue.

The cost cuts, which will total £ 53.6 million ($76.4 million) a year, come as the paper said it is expected to record an operating loss of £ 53 million in the year ending in March. The paper said it is aiming to reach break-even by 2018.

"Against the backdrop of a volatile market, we are taking immediate action to boost revenues and reduce our cost-base in order to safeguard Guardian journalism in perpetuity," said David Pemsel, chief executive of the Guardian Media Group, which is owned by the nonprofit Scott Trust.

A representative for the paper declined to comment on whether layoffs are expected. The Guardian employees a total of 1,960 full-time staffers. A person familiar with the matter said the cost cuts would primarily be felt within its U.K. operations.

The move comes during a particularly rough year for British newspapers. The Guardian reported that print advertising across the industry in the U.K. fell 25% last year and that gains in digital advertising had not offset that shortfall.

News Corp, owner of The Wall Street Journal as well as the Times of London, the Sunday Times and Sun newspapers in the U.K., reported on its most recent earnings call a "mid-single digit" percentage decline in its U.K. advertising revenue in the fourth quarter, with the Sun down in the "low-double digits."

In recent years, the Guardian has moved to expand its digital operations, particularly internationally, and has made broad hires. Of 479 commercial and editorial staffers added over the past three years, a third of them have been in the U.S. and Australia, the paper said. The Guardian doesn't charge for its online content.

Moving forward, the Guardian said it would focus more on international growth initiatives.

The paper also said it would move to revamp its advertising models to center more around branded content, video and data-driven products. It also plans to relaunch an "enhanced membership program" in an effort to double reader revenue. The company didn't provide details.

In 2014, the Guardian's cash reserves were bolstered by the sale of its stake in Auto Trader, a classified website, for nearly £ 900 million. But the paper said the reserve fund has decreased from £ 838.3 million in July to £ 735 million.

Write to Lukas I. Alpert at lukas.alpert@wsj.com

(END) Dow Jones Newswires

January 25, 2016 12:45 ET (17:45 GMT)

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