Johnson Press: Irish newspaper titles performing worse than those in Britain

REGIONAL newspaper publisher Johnson Press said its titles in the Republic are performing worse than those in Britain due to the slowdown in the Irish classified advertising market.

The media group, whose titles in the Republic include the Leinster Leader group, Kilkenny People Holdings, Leitrim Observer and Longford Leader, has introduced a series of group-wide cost reductions which have brought net debt down by £3m (€3.5m) to £419m at the end of April 2010. It also disposed of the Tallaght Echo at the end of 2009 but has no other core strategic changes planned for its business in the Republic.

Johnson Press CEO John Fry said: “The Irish business is worse than our UK business. What we have been seeing for the UK is that the weekly take for classified adverts has been relatively stable, despite some disruption from the general election. Analysts are saying that the UK market should pick up and be fairly flat by the third quarter of this year.”

Johnson, whose British regional titles include the Scotsman and the Yorkshire Post, saw its 35% rate of decline for 2009 improve to just 7.1%, down for the first 18 weeks of this year. However, Johnson’s prediction of a “flat” rate of decline for the group’s Q3 performance in Britain is unlikely to be replicated here.

Johnson Press CFO Stuart Paterson said: “Ireland is still in double digit decline, with classified adverts for employment, property and motors all down. In Britain we are seeing some property advertising coming back into the papers, but not in Ireland.

“The Irish economy and the property will have to improve before the business picks up. It will continue to be more difficult than in the UK.”

Mr Paterson said the company has no plans to close more of its hundreds of titles but said there would be further reductions in head count. The UK-headquartered group cited subdued advertising levels during the British general elections as the primary reason for a 6.6% fall in its London share price yesterday.

While the publishing company’s total advertising revenues for the 18 weeks to May 8 were down 7.1% on a like-for-like basis, digital revenues have increased by 12.3% during the same period.

Continued cost-cutting measures and the advertising pickup in certain key sectors support the group’s projections for the third quarter of 2010. Analysts predict the Johnston group will report 2010 earnings per share of 4.33p and revenue of £417m.