The publisher of The Scotsman newspaper and numerous local titles in Scotland has reported an almost 11 per dent drop in advertising during the 18 weeks leading up to the end of last week.
In an interim management statement issued this morning, Johnston Press plc says its total advertising revenues for both print and digital were down 10.6 per cent compared to 12 months previously. In more detail, it comprised a 11.6 per cent year-on-year decline during the first quarter of this year followed by a 7.8 per cent year-on-year decline during the first five weeks of the second quarter.
Says a statement: “The weakest performing category in Q1 was employment (down 30.7 per cent on 2010) with public sector cutbacks having a significant effect. In 2010, public sector spending was most buoyant in Q1 and declined considerably between then and the end of Q3. Therefore the impact from decreases in public sector activity is expected to reduce throughout the year.
“Display advertising, our largest category, continues to perform better with year‑on‑year declines in Q1 of -7.9 per cent improving to +5.5 per cent in the second quarter to date, the start of Q2 benefiting partly by the move of Easter from March to April.
“Given the high proportion of employment advertising within the Group's digital offering, internet revenues have been impacted by the tough employment conditions and the lower levels of sell on from the printed product. However, we are encouraged by the successful launch of a new online Business Directory and Customer Review offering, 'Find it', at the start of March.”
The statement goes on to note that newsprint prices this year are “significantly higher” than last year.
It adds: “Nonetheless we anticipate mitigating this increase and other inflationary pressures through continued cost management as well as generating incremental year‑on‑year savings in the region of £5million.”
Net debt was £388.7million at the end of April.
