Operating profits at newspaper publisher Johnston Press increased for the first time since 2006, according to its latest results.

The group’s interim results for the first six months of the year to 3 July show operating profit before non-recurring items was up 5.9pc to £40.5m, compared to £38.2m for the same period last year.

Revenue at the publisher was down 5.2pc year-on-year to £207.3m but digital revenue grew by 10.9pc to £10.m – which was said to be driven by recruitment site improvements launched last August.

And the company has seen the rate of decline in its advertising revenue slow, which is now down 6.3pc year-on-year, compared a fall of 32.7pc for the same period last year.

The financial statement said costs had continued to be reduced and were £13.6m lower, with the headcount now at 5,417 – down from 5,640 at the start of the year – primarily because of the introduction of the Atex content management system.

Chief executive John Fry said: “In the first half the group achieved an operating profit before non-recurring items of £40.5m up from £38.2m in the prior year. This represents our first operating profit increase reported since 2006.

“As we move into the second half of the year, we have seen the improving trend in advertising revenues continue, with total advertising in the first six weeks on a like for like basis only down 3.7pc. Within this performance digital revenues grew by 9.7pc. Circulation revenues in July have also performed well and are down only 1.6pc.

“These industry leading trends which demonstrate the strength of our publishing portfolio along with our continued focus on costs, efficiencies and debt reduction, give the board confidence, in the absence of a further deterioration in the UK economy, that the outcome for the group in 2010 will be in line with current market expectations.”

The results said there was evidence titles nearer London were recovering from the economic downturn first, with print advertising revenues in the Midlands and South outperforming those in the North, Scotland and Ireland.

Mr Fry’s half-year statement added around 80pc of editorial staff now used the Atex system, which reduces the number of sub-editors, with the rest set to receive it later this year.

He said: “Cost reductions have continued with full time equivalent headcount down from 5,640 at the start of the period to 5,417 at 3 July 2010, primarily through improving processes and investing in industry leading systems.

“These processes and systems have enabled an improvement in service for our customers as well as a reduction in costs.

“Most notable in the first half is the continued roll-out of our editorial system from one that was print based with digital elements developed in-house to a purchased editorial/content management system.

“This creates a single view of our editorial content and positions the group to deliver this content via print, internet and mobile channels without the high level of rework the previous systems required.”

Comments

Mr_Osato (25/08/2010 10:32:44)
as a ‘customer’ of Johnston Press, I’m sick of trying to make sense of garbled, semi-literate, ungrammatical, literal-stuffed garbage masquerading as news. How has the service to me improved?

dave_header (25/08/2010 10:37:10)
Mr_Osato – it doesn’t have to. You are still a ‘customer’ and that’s why it works!

Des Neeley (25/08/2010 10:39:55)
It’s interesting to note that Digital Revenue contributes just 5 per cent to total revenue. Yet it’s promoted as the be all and end all. Also, how much of that digital revenue is generated for the net alone, and not just a percentage of advertising monies diverted to the net by way of special offers?
And it would be nice if staff were referred to as something other than a headcount. How about using “staff” for instance?

Bernard Humpage (25/08/2010 10:45:33)
Im happy being a Headcount … there was me thinking I was just an employee number

Wrekked Train (25/08/2010 11:09:12)
Surely this is good news? The fact that the company we work for is showing signs of recovery. We are a business after all. So stop moan. Please.

Sly Dig (25/08/2010 13:01:46)
The most telling statistic in all that garbage was costs had been reduced £13.6 million, which contributed to a rise in profits of just £2.3 million.
Had it not been for the reduced “head count” (Redundacies), then profits would have shown a fall of around 25 per cent. With revenues also falling, that to me is not the sign of a healthy business, more like one in terminal decline.

observer (26/08/2010 12:00:25)
Des Neeley is right. Why does JP persist with the dead duck that is web advertising when it needs more staff to improve the papers that bring it PROFIT.
Drop the web and help the papers thrive JP. Seeeemple.

webbedfeet (26/08/2010 12:08:40)
observer touched a nerve with web.
There are those at senior level in JP that recognise that advertisers dont want to pay for space on local paper webs, especially weeklies.
There’s simply not enough hard news in most weeklies to encourage people, It’s no-one’s fault, just fact of life.

Wrekked Train (26/08/2010 12:45:52)
I just can’t believe that in 2010 there are still dinosaurs out there who don’t realise digital is the future. Unbechuffinlievable.

webbedfeet (27/08/2010 09:25:15)
Wrekked train: not dinosaurs, realists. Of course everyone recognises digital might be the future, but two serious questions remain. Will firms like JP and Newsquest staff it properly (they don’t at present) and how will it raise ad income from the current very low levels.
The only reason they can show any profit however pitiful is because paper hacks are doubling as web workers. (cheap labour)
If it was staffed properly the tiny profit from digital would be wiped out.
That’s the problem facing the industry.
It is absolutely no good shoving material on a website if most people cannot be bothered to read it and hence the lack of ads. Hit levels are seriously low even for the best stories and sites- you need tens of thousands not a few hundred.
Digital might be the future; how rosy that might be at small local paper level still remains to be seen.
Meanwhile everyone needs to keep their eye on the ball on newspapers-because they are subsidising the digital operations.