Profits fall by a third at Johnston Press
REGIONAL newspaper group Johnston Press, publisher of the Lancashire Evening Post, has seen pre-tax profits fall by a third, it said today.
For the 52 weeks to January 1, pre-tax profits dropped 29.6% to £30.5m while revenue also fell 6% from £423.7m to £398.1m.
The group has recorded its first underlying operating profit increase, excluding acquisitions, since 2004 from £69.3m in 2009 to £72m.
The group also announced that chief executive John Fry will step down by March 2012.
Chairman Ian Russell said: “The pace and consistency of the economic recovery remains uncertain and this is reflected in a weaker start to 2011 than we had anticipated.
“Nevertheless, much of the group’s work in 2010 was concentrated on improving systems and technology and making processes more efficient.
“Given the group’s historic strengths and presence in the many communities it serves, our opportunity now is to be innovative in growing revenues both from traditional and new sources and capitalising on the economic recovery when it gathers pace.”
Johnston Press said that despite the significant increase in finance costs the group’s net debt reduced by £35.4m to £386.7m.
Print advertising was down 7.1% in 2010 with public spending cut backs impacting Q4.
The group saw continued growth in digital advertising, up 4.0% on a like-for-like basis while like-for-like newspaper sales revenues were down 2.8%.
Total operating costs before non-recurring items were down by £30.1m, offsetting revenue reductions.
The group said it continues to deliver market leading operating margins and operations remain cash generative. Operating profit on an underlying 52 week basis grew by 3.9% and total cash generated by operations was £69.6m.
It recorded profit before tax performance impacted by increase in finance costs and net impairment charge on intangibles of £13.1m.
Total advertising revenues for the first nine weeks of 2011 were down by 11.4% with a greater proportion of recruitment revenues in the comparative.
