Regional publisher Johnston Press has revealed it cut more than a fifth of its workforce during 2012 with around 1,300 jobs disappearing.
Annual results published today showed the company achieved overall cost savings of £37.6m during the year, enabling it to reduce its net debt from £351m to £319m .
But it came at the expense of a 23pc reduction in staff numbers, with the group’s overall headcount falling from around 5,650 to 4,350 at the end of December.
In today’s financial report, chief executive Ashley Highfield said the job cuts had inevitably had “a degree of disruptive impact.”
Today’s results saw a partial turnaround in the group’s fortunes with statutory operating profits of £40.4m compared to an operating loss of £107m in 2011.
Overall revenues were down by around 12pc from £373.8m in 2011 to £328.7m last year, but the group reported “encouraging” results for its relaunched newspaper titles, with circulation revenues up 7.9pc year-on-year in December.
The financial report said the year had seen “substantial progress” in the implementation of the group’s strategy, leading to increased efficiency and “significant” reduction in net debt.
As well as the staff reductions, the £37.6m reduction in operating costs was also partly attributable to the closure of four print sites at Leeds, Peterborough, Sunderland and Isle of Man during the year and the consolidation of its printing operations at Dinnington, Portsmouth and Carn.
Said Ashley: “Good progress has been made in the process of transforming the group in 2012 and the changes made provide a strong platform for us to build on in 2013 as we invest in refreshing our print portfolio, and simultaneously move our operation to be real-time, digitally led, social, mobile and ever more local.
“The economic environment remains challenging, but with the steps that we have taken to improve the effectiveness of the business, to accelerate the growth of our digital revenues, and to continue to manage our costs tightly, we believe that we are well positioned to deliver a strong operating performance in 2013 along with continued strong cash flow.
“The on-going development of our trusted local newspaper brands across print and digital remains key to us doing this, allied to the best use of both current and developing technology and the opportunities they can create for us.”
“The profound change that our industry is experiencing has meant we have continued to need to reduce our workforce and the number of staff employed by the group fell to just over 4,350 at the end of December, down 23.1pc on 2011, inevitably with a degree of disruptive impact.”
Ashley said that a priority for the year had been putting in place the “infrastructure, technology and resources” to achieve future growth.
He revealed that all 800 JP sales staff had now been issued with iPads and 350 journalists with new laptops and smart phones.
The ongoing relaunch of all the group’s paid-for titles has so far seen 69 titles redesigned along with 200 new mobile websites, 18 tablet apps and 11 phone apps.
In his report, Ashley also made a passing reference to the spate of office closures across the company, saying: “Our plans have also seen many of our staff move to far better accommodation – suitable for our future needs.”
Commenting on today’s figures, the National Union of Journalists welcomed the reduction in the company’s debt levels but warned against further job cuts and office closures.
Deputy general secretary Barry Fitzpatrick said: “Today’s figures for the Johnston Press may look encouraging, but the loss of jobs – nearly a quarter of the workforce – between 2011 and 2012 is a great cause for concern, as is the fall in circulation of papers which have gone from being dailies to weeklies.
“The closure of district offices is taking reporters out of the heart of the communities they serve; this is doing a disservice to readers who want to know about their local news.
“While it is good that the group is making in-roads into the company’s debt, the future of the group will be in real jeopardy if more job cuts are made. Readers will notice if quality falls as a result.”
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JP “debt slashing” according to the financial results…
“includes receipt of £30.0m in connection with partial cancellation of contract printing arrangements with News International.”
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This is a line from their report: ‘Total advertising revenues for the first 10 weeks of 2013 are 15.6% below the same period in the prior year although all categories (with the exception of motor advertising) have shown an improving trend of reducing declines over the 10 week period’.
So all we need to do is improve the reducing declines! You couldn’t make this corporate speak up could you?
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No doubt JP will hope to improve on that figure in 2013.
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It’s nice to see a return to operating profit, but the thing that worries me is that after all the one-off cost cutting and payments, the debt has still only gone down £30m. It’s not like they’ll be able to repeat those tricks next time round. Sooner or later they’ll run out of things to cut, and what’ll they do then?
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With all this joyous talk –
I wonder how those 1300 lives have been affected, and how many are still unemployed?
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All this and rumours of another round of price rises that’s bound to hit sales hard again.
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I thought JP didn’t employ any journalists? That’s what they claimed a few years ago to avoid industrial disputes.
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Redundancy packages would have cost millions so I’d hope that this year will see profits rise, so no m
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These results are dreadful. Without the £30m from NI, debt would have come down by a measly £2m or so. Meanwhile, revenues and profitability continue to collapse. With little scope left for cuts, where will AH find the next pound of flesh for the banks? Johnston Press plc will not make it to the end of 2013.
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One of those jobs was mine. I am utterly delighted to be rid of it and out of JP.
Why no proper scrutiny of these results. JP claim “like for like” revenue growth for their “re-launched” titles. This is spin. The dailies which switched to weeklies have seen severe circulation (and revenue over five days) decline. This has got worse since January. Eventually someone will see through the Emperor’s clothes.
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Must agree with Bilge, Sheffield! My time with JP is something I never wish to experience again!! Funny how it was/is frontline staff who bear the real pain while top management walk(ed) away with bulging pockets!!
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Thank you COFFEE DRINKER for thinking of those of us that remain jobless. Personally, I still miss the hard work and use of my talents at JP. Looking at the local papers though, at least I can see that my loss is also their loss. I cannot see ad revenues improving any time soon, on the evidence of some of the outsourced design.
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Thanks COFFEE DRINKER but leaving JP after 15 years was the best thing that ever happened to me! I have my life back and now work for a firm that appreciates me. Just feel bad for all of the talented, dedicated wonderful colleagues I left behind who still have to work under the dark cloud of JP.
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