Johnston Press writes €16.7m off Republic titles ahead of sale
Edinburgh-based newspaper publisher made a loss of £287m last year
Ashley Highfield: under his leadership, Johnston Press has embarked upon a major restructuring in recent years
Johnston Press took an impairment charge of £13.8 million (€16.7m) on the value last year of its titles in the Republic, which the regional newspaper group is on the verge of selling.
The writedown has reduced the carrying value of the 14 titles to £5.4 million (€6.5m), a fraction of what it paid for them during the boom.
The Edinburgh-based company said talks were “well progressed” to sell the titles in the Republic which include the Leinster Leader , the Donegal Democrat , the Limerick Leader and the Kilkenny People , and related property assets. Negotiations were at “an advanced stage”.
The employment contracts of staff of Naas-based Johnston Press Ireland were transferred to another company, Formpress Publishing, in February. Formpress was incorporated in January, and its directors are listed as Kieron Patrick Hayes and Marian Hayes.
The British millionaire Malcolm Denmark, who owns the advertising agency Mediaforce, is understood to have entered into talks late last year to buy the titles via his company Iconic Newspapers.
In a statement to the London Stock Exchange in December, Johnston Press suggested it was looking for a sale price of €8.5 million in cash.
The group also publishes the Leinster Express, the Tipperary Star, the Leitrim Observer, the Longford Leader, the Nationalist & Munster Advertiser (based in Clonmel), South Tipp Today and the Donegal People’s Press.
The company reported a total loss of £287 million for 2013 after it recognised a writedown of £202 million on the value of its newspapers and almost £64 million on its printing presses. The impairment charge on its titles in Northern Ireland came to £37.6 million.
Revenues across the group plummeted 15.6 per cent to £302.8 million. Total advertising revenues fell 10 per cent during the year, but income from digital display advertising grew more than 30 per cent, albeit from a relatively low base.
Despite the heavy losses, Johnston Press said its underlying operating profit increased 2.5 per cent to £54.3 million.
Under chief executive Ashley Highfield, Johnston Press has embarked upon a major restructuring in recent years, slashing employee numbers and closing, amalgamating or reducing the publication of some titles, while stepping up its digital publishing activities.