Regional publisher Johnson Press has seen operating profits rise 16pc despite a fall in revenues, as cost savings of nearly £13m were made in the first half of 2012.
The interim results for the company were published this morning showing operating profit including non-recurring items was up 16pc at £37.8m, representing an increase of £5.2m from last year.
This comes despite revenues for the period being down to £176.1m from £191.8m last year, a fall of 8.2pc.
The statement says costs were cut by £12.8m for the first six months of the year and the company is on track to make total cost savings for the year of £25m.
Ways in which this has been done include simpifying JP’s management structure, closing certain printing facilities, moving out of offices which are not fit for purpose and reducing its contact centres from 14 to two.
Net debt at the publisher has been reduced further and stood at £332.1m at the end of July, which was boosted by News International being released from a printing contract, which gave JP a compensation payment of £30m.
This payment was significant in helping increase the operating profit because when this and other non-recurring items are excluded, the operating profit fell by 8.7pc to £30.4m and pre-tax profits fell by almost half to just over £8m.
The statement highlights changes made under chief executive Ashley Highfield’s plans to transform the company, which will see all titles relaunched before the end of this year and an increased focus on digital.
It says the first 23 relaunches have been a success and iPad apps have been launched for seven titles, with The Scotsman’s app already being downloaded 20,000 times in the first half of the year.
The statement shows newspaper sales revenues were down 3.1pc for the first six months, which included the impact of the five papers which switched from daily to weekly publication in May.
Excluding these titles, the fall was just 2.4pc and the statement says the circulation revenues were also affected by some cover price increases being delayed until after the relaunches of the titles.
Print advertising revenues were down 12.5pc, but digital revenues grew by 8.4pc in the period, with digital property advertising seeing a growth due to the launch of a new property site in the spring, in partnership with Zoopla.
And the statement said the Olympics had failed to boost advertising revenues, with the first six weeks since June seeing total advertising revenues down 14.7pc.
Ashley said: “The first half has been a period of tremendous activity and we have made significant progress. Johnston Press is going through a strategic transformation.
“As we continue to develop our digital portfolio, refresh our print offering, reduce costs, and use our substantial operating cash flow to bring down our debt, we are increasingly confident about the success of the strategy and the benefits that it will deliver.”