Pre-tax profits at Scottish publisher DC Thomson fell by three-quarters last year, from £86.4m to £21.1m.
The owner of the UK’s top-selling regional daily, the Press and Journal, reported advertising revenues down by 5.6 per cent to £37.1m for the year ending 31 March 2019.
New accounts filed with Companies House show the company, which also publishes the Sunday Post and Evening Express, grew its overall revenues from £207.3m in 2018 to £221m.
Company director Andrew Thomson said in a statement: “Our trading operations have been affected by challenges to revenues but the core publishing business continues to trade well in comparison to our peers.
“We believe in the longer-term future of the publishing business and are working on brand extensions and other initiatives to support it.
“There is a strong brand loyalty to our traditional titles and we look to replicate this in the new businesses that we have acquired.
“We are also seeking to develop, source and evaluate new and adjacent lines of business, potential investments and acquisitions.”
Newspaper advertising revenues were down 7.6 per cent on 2018 to £13.5m, while magazine revenues at the company’s mostly women and children-targeted titles were down five per cent to £23.6m.
The company said this could partially be put down to its decision to close men’s magazine Shortlist in December 2018 as part of a strategy “to align activities entirely to the women’s market”.
DC Thomson reported a ratio of 68 per cent circulation revenue to 32 per cent advertising revenue, compared to 66 per cent and 34 per cent the previous year, which it said gave it “more protection against advertising declines than many publishing businesses”.
It added that this ratio was “important in the context of the competition from businesses such as Facebook and Google”.
Newspaper circulation revenues were down 2.2 per cent to £33.4m, with the company saying cover price increases had helped to “reduce the effect of the continuing trend in volume declines”.
Magazine sales grew by eight per cent to £46.1m, which the company put down to its purchase of specialist magazine publisher Aceville in September 2018.
Thomson said: “Whilst competition from online advertising businesses continues to cause issues for our print advertising, particularly display, we continue to develop new ways of working, levering the quality and reputation of our products.
“We continue to consider the acquisition of businesses aimed at adding to the media offering to increase profits and give the business a broader range of product.”
In April 2019 DC Thomson bought Scottish golf magazine Bunkered as part of a buyout of PSP Media Group and in September it launched a new monthly magazine aimed at women over 55.
Thomson added: “Whilst we expect our traditional business to continue to prosper, we are committed to finding new products and markets.”
DC Thomson’s non-publishing revenue streams include events, which grew by 10.7 per cent last year, and contract printing, which grew by 6.1 per cent as other publishers “gradually reduced” their in-house press facilities.