Johnston Press: Market 'tougher than expected'

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Johnston Press has reported a decline in total revenues in the 18 weeks to 3 November, as its reports that "trading in the second half of 2012 has been even more challenging than in the first".

According to an interim management statement published today the regional publisher said that total revenues, when compared year-on-year on "a like-for-like basis", had fallen 11.4 per cent. Circulation revenues were also down 0.5 per cent while total print and digital advertising revenues dropped 14 per cent.

Johnston Press cited the shift of some titles from daily to weekly publishing, the ceasing of publication of some titles and "changes to the contract printing operations as a result of the revised arrangements with News International", as impacting on the results and having prompted the reporting of results on both a "like-for-like" and unadjusted basis.

The unadjusted figures show a drop in total revenues of 16.1 per cent, a decrease in circulation revenues of 5.1 per cent and a fall in total print and digital advertising revenues of 16.3 per cent.

Digital revenues alone however increased 2.9 per cent, with "online display revenues in particular" said to be maintaining "strong growth".

The publisher added that "the overall digital growth has been impacted by the reduced digital upsell from a lower level of print employment advertising" but that "this is being addressed by an increased focus on standalone digital employment advertising and a move to a 'digital first' approach".

The publisher concludes: "Provided that the trading environment does not deteriorate further, with continued achievement of the identified cost savings, increased circulation revenues during Q4 and a growing digital business, we expect full year operating profit performance for 2012 to be broadly in line with current market expectations."

Chief executive Ashley Highfield added in a statement that the publisher has "made good progress in restructuring our operations, reducing the cost base, maintaining focus on debt reduction and continuing to invest in growth areas".

"We have moved forward with the re-launch of our titles with encouraging early signs, and our digital business has seen a huge increase in audience this year, as well as the launch of services across iPad, mobile and PC, which will provide a springboard to future digital revenue growth.

"As a result, the business is moving onto a more stable footing as we go into 2013 when the full benefits of the changes will be seen."

In the first half of 2012 Johnston Press reported a 8.2 per cent fall in revenue , from £191.8 million to £176.1 million, and an 8.7 per cent drop in operating profit, both before non-recurring items.