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March 19, 2013updated 21 Mar 2013 10:24pm

Johnston Press cuts 1,300 jobs as revenue shrinks by 12 per cent

By William Turvill

Johnston Press cut nearly a quarter of its workforce last year as underlying operating profit fell by 12 per cent to £57m on underlying turnover down 12 per cent to £328.7m.

The regional publisher axed more than 1,300 positions between 2011 and 2012, meaning it now has a total staffing of just over 4,350. It is currently proposing to make the editor of one of its best-performing weekly newspapers, the Whitby Gazette, redundant.

It reported a pre-tax loss of £6.8m for the 2012 financial year, down from a loss of £143.8m in the same period a year ago, and cut its net debt by £32.3m last year, from £351.7m in 2011 to £319.4m in 2012. The huge pre-tax loss of a year ago was caused by a reduction in the value of the group's assets.

Johnston Press cut its operating costs by £37.6m – helped by the consolidation of the group’s printing capacity and the closure of four print sites last year.

Total advertising revenues decreased by 12.7 per cent year on year. Revenue was helped by a payment of £30m in connection with partial cancellation of contract printing arrangements with News International.

The group reported that circulation revenues for relaunched titles were up 7.9 per cent year on year in December. Overall circulation revenues were down 4 per cent year on year.

Digital advertising revenue, meanwhile, grew by 12 per cent as the publisher seeks to build its online profits.

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Today's statement said that the group was attempting to put in place the infrastructure, technology and resources to help its long-term growth. This included buying its 1,500 sales staff new software and 800 iPads – meanwhile, 350 journalists were provided with new laptops and smartphones.

It also redesigned 69 regional newspapers and launched 200 mobile websites, 18 tablets apps and 11 phone apps.

Chief Executive, Ashley Highfield, said: "Good progress has been made in the process of transforming the Group in 2012 and the changes made provide a strong platform for us to build on in 2013 as we invest in refreshing our print portfolio, and simultaneously move our operation to be real-time, digitally led, social, mobile and ever more local. 

“The economic environment remains challenging, but with the steps that we have taken to improve the effectiveness of the business, to accelerate the growth of our digital revenues, and to continue to manage our costs tightly, we believe that we are well positioned to deliver a strong operating performance in 2013 along with continued strong cash flow. 

“The on-going development of our trusted local newspaper brands across print and digital remains key to us doing this, allied to the best use of both current and developing technology and the opportunities they can create for us."

Barry Fitzpatrick, deputy general secretary of the National Union of Journalists, described the number of jobs lost as "a great cause for concern".

He said: "The closure of district offices is taking reporters out of the heart of the communities they serve; this is doing a disservice to readers who want to know about their local news.

"While it is good that the group is making in-roads into the company’s debt, the future of the group will be in real jeopardy if more job cuts are made. Readers will notice if quality falls as a result.”

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