Johnston Press chief executive Ashley Highfield believes the advertising market is not as “volatile” for regionals as it is for nationals.
In its interim results, published today for the six months to 3 July, Johnston Press reported operating profit down 4.3 per cent year-on-year to £27m.
The regional publisher’s total revenue was down 4.6 per cent to £128.9m in the six months.
Advertising revenue was down 5.1 per cent to £80.6m. And within this figure, print advertising was down 9.5 per cent to £64.1m and digital was up 17.5 per cent to £16.5m.
Johnston Press issued a statement in July warning that there had been a “slowdown in general trading”. After this announcement, the share price of Johnston Press fell from 142p to 105.63p.
Its interim results today revealed that underlying advertising revenue fell by 9.5 per cent year-on-year in May. It said that this situation has improved, but underlying advertising revenue was still down 7.7 per cent last month compared with July 2014.
Highfield said in a statement: "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.
"However, we believe, local publishing, with SMEs representing 80% of our advertising revenue, is not as volatile as national publishing. We have seen some improvement in reducing the decline in advertising revenues in July compared to July 2014. We will continue to drive for further improvement in revenues, albeit off a lower base, and will also continue to target further cost savings.”
Despite the difficult second quarter – which has been acknowledged by other publishers also – Highfield told staff in an email last month that he expected the company to “return to advertising growth for the first time in a decade” this year.
Elsewhere, the results showed that Johnston Press paid £90,000 to Love News Media Limited for the Brighton and Hove Independent, a free weekly title with a circulation of 13,000.
Newspaper sales revenue was down 5.3 per cent year on year to £37.6m, the results showed. The company said this reflected the “decision to keep cover prices unchanged in over 60 of our titles”.