Regional newspaper publisher Northcliffe Media is promising "significant" cost cutting in 2009 after profits slumped by nearly a third, it was announced today.

Figures published this morning reveal a drop in underlying profit of 32pc for the year ending 28 September 2008.

Operating profit was down 26pc from £93m to £68m while revenue fell 6pc from £447m to £420m.

All categories of advertising fell in the year with the rate of decline accelerating almost on a monthly basis since the first signs of weakness appeared at the start of the year, a statement said.

"The gloomy economic outlook points to extremely challenging conditions for our key advertising markets throughout the coming year," it said

"A new regional operating structure has been implemented which will allow us to benefit from our scale in the South West, Midlands and north of England.

"We are reviewing all areas of expenditure and expect to remove significant further costs from Northcliffe in the coming year.

"In addition to the divisional cost cutting measures within Associated (Newspapers) and Northcliffe, we have also established A&N Media, a structure to share services across both divisions and to improve operational efficiency."

Property was down 22pc with September suffering particularly badly as it was only half of that achieved in September 2007.

Recruitment advertising declined by 11pc – again September was a difficult month when recruitment advertising fell by 30pc.

Motors advertising fell by 12pc with the company citing "online migration" and an increasing number of used car dealers going out of business.

UK digital revenues grew by 42pc to £17m, representing 6pc of all advertising income.

Newspaper circulation revenues also dropped by 3pc to £73m.

Some cover price increases were taken during the year but, for others, price increases were delayed to minimise any adverse impact on sales.

For the January to June 2008 ABC period, Northcliffe's weeklies were down by 4.5pc compared to an industry decline of just over 5pc.

Daily titles underperformed against the industry average, down just over 6pc compared to an industry decline of 5pc.

Advertising trends have continued to decline for Northcliffe Media in its new financial year.

October revenues are down on the prior year by 28pc. Property revenues were 52pc down and recruitment fell by 37pc.