Operating profit at Johnston Press fell by 53.2pc, the publisher announced today.

Interim results for the 26-week period ending 30 June 2009 show that profits dropped to £38.2m, compared with £81.6m in the same period last year, representing a current profit margin of 17.5pc.

Total revenues are down 25.4pc, falling to £218.6, compared with £293.1 in the same period last year.

Other key points from today’s interim report show:

All advertising revenues are down 32.7pc: print by 33.5pc and digital by 18.8pc.

Recruitment advertising fell by 53.8pc, property by 54.2pc, motors by 29.3pc and other classified by 11.5pc. Display revenues declined by 16.3pc.

Advertising revenues had stabilised for the first eight weeks of the second half of the year, down 26.1pc year-on-year.

Newspaper sales revenues were down 1.9pc on the comparable period with circulations declining by an average of 7.7pc across JP’s dailies and 7.1pc in its weeklies.

Circulation revenues now make up 23.1pc of total revenues, up from 17.6pc in the first half of last year.

Contract printing revenues were down 8.6pc, reflecting reduced volumes and the closure of some publications previously printed under contract.

Total costs dropped by £31m and net debt has been reduced by £52.8m to £424m since the start of the year.

Group focused on a series of cost reduction projects, including reducing full-time headcount from 6,408 to 5,969.

No interim dividend has been proposed in the first half of the year.

Chief executive officer John Fry said: “The timing of the economic upturn remains uncertain but advertising revenues are demonstrating greater stability and we expect the cyclical improvement when it comes to more than compensate any ongoing structural change.

“We will maintain our focus on costs and look to secure additional operating efficiencies during the second half of the year.

“Negotiations with our lenders have been completed and have resulted in a new facility being agreed.

“This facility provides a stable financial platform, allowing the group to actively manage through the current cycle.”

Visit the Johnston Press website to read the full report.

Comments

Mr_Osato (28/08/2009 10:15:52)
17.5 per-flipping-cent at the nadir of the deepest recession in living memory? And they’re still talking about cost-cutting? It’s a profit margin that would make Tesco blush. OK, Johnston has big debts to deal with (no fault of the current boss) but surely it’s time for this company to start investing in its titles?

Fox Mulder (28/08/2009 10:58:22)
£38.2m profit? Don’t know how the poor blighters expect to get by on that!
Their profit margins are astonishing given the downturn – many businesses in other industries would give their right arm for this. Still, it won’t be enough for them.
Mr Osato, don’t hold your breath for investment in products – in third to last par, Fry says: “We will maintain our focus on costs and look to secure additional operating efficiencies during the second half of the year.” In other words, even smaller papers, the digital side will still be an unco-ordinated and underfunded farce and redundancy here we come!

Dario (28/08/2009 11:00:27)
John Fry really meant: “Subs will be laid off in the new year as reporters write straight on to the page.”

Fox Mulder (28/08/2009 11:04:42)
Dario – Aye, you can’t beat a shiny new content management system when it comes to decimating staff numbers and morale.

Former JP hack (28/08/2009 11:19:12)
£38m profit?! But it’s not enough for the shareholders is it?
That’s why JP now has centralised subbing ‘hubs’ a long way from where the newspapers are actually written; why one editor is now overseeing two papers; why there are recruitment freezes and it takes six months or more to replace staff – if ever; and why journalists and editors with decades of experience are leaving in their droves to take redundancy while they still can.
Poor, poor show.

Miss Cynical (28/08/2009 12:46:30)
Looking at this objectively, I agree with JP that the figures are seriously worrying.
Yes, £38.3m seems a lot of profit – but it’s fallen more than 50 per cent in six months. That is seriously bad news for any business and is clearly not sustainable in the long-term.
In addition, this is coupled with a debt of more than £400 million.
I’m no accountant, but that’s a pretty hefty difference between their profit and debt…

Mr_Osato (28/08/2009 13:17:09)
Well, on a turnover for six months of 220m (implying 440m for the full year), net debt would appear to be equivalent to a year’s turnover. If your mortgage equalled your salary you wouldn’t think you were doing too badly, would you? Unless you worked for JP and were worried about your job, of course.