Local newspaper company interim profits down 50%
REGIONAL NEWSPAPER publisher Johnston Press’s underlying profits almost halved in the first half of the year as advertising revenue from its print operations continued to decline, largely as a result of fewer classified ads.
The Edinburgh-based company, which publishes a number of Irish titles including the Kilkenny People and the Limerick Leader, saw underlying interim pre-tax profits nearly halve to £8.1 million (€102.5 million) from £15.7 million a year earlier.
However, the company’s bottom line was helped by a one-off £30 million payment from News International in a partial termination of a long-term printing contract.
Although digital revenues rose more than 8 per cent to £10.3 million, revenue from the larger print advertising side of the business plummeted 12.5 per cent to £97.4 million, the interim results show.
Newspaper circulation revenue was down 3.1 per cent in the first half of the year, with the decline in sales revenue exacerbated by the impact of switching five daily titles to weeklies in May. The group, which owns nearly 250 titles, has re-launched 23 of its publications so far this year, with the rest “on track” for re-launch later in the year.
Burdened with net debt of £362 million, as of the end of June, the group has also closed some titles in the UK and Ireland, including the Offaly Express in Tullamore.
The company, which also publishes the Scotsman and Yorkshire Post, reduced costs by £12.8 million, or 8.1 per cent, in the first half of the year as it simplified its management structure – including the removal of some editors – and cut more than 400 jobs in total. It is targeting savings of £25 million for the full year.
Johnston Press chief executive Ashley Highfield said the first half of the year had been “a period of tremendous activity” for the company and that it had made “significant progress” in its restructuring.
The group will continue to develop its digital interests, reduce costs and refresh its print offering, he said.
The latest accounts for Johnston Press Ireland Ltd show pre-tax losses of €3.9 million in 2010 and €5.3 million in 2009.