Advertising revenue decline sees Johnston Press profits drop 2.9%

THE chief executive of regional newspaper group Johnston Press Tim Bowdler yesterday hailed Ireland as a well-performing region for the group in a generally tough trading environment.

The Edinburgh-based Johnston, the second largest local newspaper publisher in Britain with significant interests in the Irish market, yesterday reported a like-for-like drop in pre-tax profits of 2.9% for the first half of this year to £79.8 million (€118.4m).

Group operating profit rose by almost 7% to £99.4m (€147m), while revenue grew by 18% on the same period last year to £312.2m (€463m). Earnings per share for the period were down by 0.9% at 20.39p, while the interim dividend is up by 10.7%.

The main reason for the drop in group profits was a continuing downturn in advertising revenue in the British market. Johnston saw its ad revenue in Britain drop by 9.2%, year-on-year, for the first half of the year.

It was a different story, however, at its Irish operations — which include the Leinster Leader Group and part of the Score Group — where ad revenues showed a 5.4% rise.

Mr Bowdler said: “It would’ve been even higher but for some staff changes implemented over the period, which held things up for a while. But, overall we’re pleased with how things are going for us in Ireland.

“We launched 10 new free newspapers under the ‘Weekender’ title, have good management teams in place and are investing in new advertising, financing and accounting systems. Ireland and Britain are very different markets right now, with British newspapers just not seeing the levels of advertising revenue that their Irish counterparts currently are.”

Johnston’s Irish titles include the Kilkenny People, the Donegal Democrat, the Offaly Express and the Limerick Leader. Mr Bowdler also said the group was looking to expand its digital publishing activities to include breaking news stories on its websites and texting headlines to customers via SMS messaging.

With regard to the group’s full-year prospects, he was less upbeat. “The second half — with regard to the British market, at least — has started as the first half finished, with no discernible improvement in advertising revenues. Our assessment of the underlying market conditions doesn’t suggest any early recovery in revenue performance.”