Johnston Press advances ‘newsroom of future’ despite fall in revenue

JOHNSTON Press has recorded a 4.6 per cent fall in first-half revenue amid difficult trading conditions but said it made good progress with efforts to reshape its publishing businesses for the future.

Edinburgh-based Johnston Press had £128.9 million underlying revenue in the 26 weeks to July 4, down from £135.1m in the comparable period last year.

The group, whose titles include The Scotsman and The Yorkshire Post, found advertising and circu- lation revenues came under pressure.

“Trading conditions in the first half of 2015 have undoubtedly been challenging, with May and June being particularly difficult – a time when there was also a high degree of uncertainty in the wider market,” said chief executive Ashley Highfield.

Mr Highfield was reported to have signalled an interest in mergers with other newspaper publishers as Johnston Press announced its latest results.

Warning last month that it antic- ipated full-year profits would be slightly below market expectations, Johnston Press said advertisers had delayed spending in the run-up to the General Election in May.

The rate of decline in advertising revenues increased to 5.1 per cent in the first half compared with 4.6 per cent in the same period last year. Print advertising revenues fell 9.5 per cent, to £64.1m from £70.8m. The fall was only partly offset by a 17.5 per cent increase in digital advertising revenues, to £16.5m, from £14.1m.

Newspaper circulation revenues fell by 5.3 per cent, to £37.6m from £39.7m. However, Mr Highfield noted that the fall in total advertising revenues slowed to 7.7 per cent in July, compared with 9.5 per cent in May.

He said: “Our strategy remains constant and is showing real traction.”

The strategy involves trying to increase the overall readership of publications by growing online audiences to offset declines in print circulations.

The company said the average monthly audience across print and digital for the period was up 8.7 per cent year on year to 29.4 million.

It said it has completed the first phase of a major structural change, by implementing its Newsroom of the Future. This aims to increase digital engagement, and arrest print decline rates, whilst improving operational efficiencies.

A spokesman for the company said The Scotsman will be refreshed next month.

Johnston Press has started planning for the implementation of its Salesforce of the Future project, with a focus on boosting digital revenues. It achieved £7.6m cost savings in the first half, which it said offset revenue declines and funded £2.6m digital investment. It will target further savings.

First half underlying profit before tax increased to £17.8m from £8.3m. Finance charges fell to £9.2m from £19.9m last time, reflecting the refinancing the company completed in 2014.

The company reduced net debt by £10.9m in the first six months to £183.3m. That compares with about £300m at the start of 2014.

Its shares rose 2.25p to 112p.