Regional newspaper groups took a hit in the stock market yesterday with three of the main publishers suffering share price dips after brokers voiced concerns over the outlook for the industry.
Johnston Press fell 8.2 per cent by the close of trading – at one point the drop was 11.6 per cent – ending on 126.25p after brokers Cazenove expressed caution over the UK regional market ahead of forthcoming updates from the groups.
Craig Dubow, CEO of Gannett, the US parent company of Newsquest, warned yesterday after releasing his company’s first quarter results that the UK newspaper market could face “the same real estate issues we have in the US”.
While Gannett’s overall figures were in line with market expectations, Newsquest’s classifieds were 11.7 per cent down in the first three months of 2008, with property and jobs ad revenue both 15 per cent down and cars 21 per cent down.
Trinity, which releases a trading update on 8 May, saw a 4.1 per cent share price drop, down to 226.75p while Daily Mail and General Trust – owners of the Mail titles and regional group Northcliffe News and Media – dropped 5.3 per cent to 422.5p.
Cazenove yesterday said DMGT was the “best positioned” of the three to weather any future economic storms – adding that the 5p Daily Mail price increase would give the company a £20m “buffer” – but warned the group was at risk due to its reliance on the housing ad market.