Regional publisher Johnston Press has announced it has agreed a deal with lenders to defer repaying its £300m debt until autumn 2015.
The company says it is intends to negotiate with the banks over the next 12 months to secure a long-term refinancing package.
In the meantime, its lenders have agreed to defer loans which had been due to be repaid in 2014 until September 2015 to give the company time to put the long-term deal in place.
Shares in JP rose by up to 16p following the move, which was announced on Friday 27 December.
Johnston Press chief executive Ashley Highfield said: “I am pleased with the ongoing support shown by our lender group in providing a clear path for the continued pursuit of our operational strategy, which has shown very encouraging developments in 2013.
“We plan to refinance the group in 2014 and will continue to work closely with our lenders and their financial advisers for that process.
“A stable medium-term capital structure will support the acceleration of our digital growth strategy and would expedite the projected return to overall top line growth.”
The company has hired investment bank Rothschild to advise it on the refinancing bid.
The full text of the announcement read: “The Company and its lenders have agreed to reset its financial covenants until September 2015, providing the Company with a stable financial platform from which to pursue a full refinancing in 2014.
“Discussions in relation to the refinancing are expected to commence in the new year and a further update will be provided in due course.”
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Good news. That debt is a heavy burden around the neck of a business that remains highly profitable.
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Well that’s alright then! Another year to decide on who else to make redundant or where else to outsource. It’s time for those on the highest salaries to take a hit. Rothschild will be doing OK out of it, no doubt laughing all the way to the … bank.
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By up to 16p???
Highfield had trimmed the staff and the assets until he has nothing left to offload !! Another price rise will send titles to the wall, the disastrous shapes exercise leaving journalists no room to include copy and leaving readers a paper that is explored front to back in five ie ten minutes! The banks can’t take blood from a stone, do it’s either defer or shut up shop!
The only hope for survival is for the banks to take control.
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Survival of what, Bloodsuckers? The company? The newsbrands? Journalist jobs? The banks taking control would be disastrous for all three of the above. They’d cut and slash far more aggressively than has been the case to date.
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Ashley Highfield is doing what he can to reduce the unsustainable debt caused by his predecessors.
Sadly what he and his board seem unable to do is to come up with a coherent strategy to make people aware of their local papers;and that if they fold they will have no one to support them in their grievances against any authority or individual
.Surely it is not beyond wit and wisdom to conceive a concerted effort to”sell” your local daily or weekly publication to those who do not already by it.
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Cynical has it about right.
In business terms Highfield has achieved a lot and buying time is the most significant. The economy could improve and the digital strategy might see results by 2015.
‘Selling’ the products, print and digital, is the challenge, not helped when the only argument at the moment is ‘buy our products or our executives, bankers and city gents will go hungry’.
Life is local also looks hollow when you slash local jobs, offshore others, and flee struggling town centres.
An adequalty resourced, indpendently minded and local media is a vital part of UK Plc’s wider economy.
Everyone in the local media business knows this yet the voices of experienced, committed and incredibly still loyal staff in ALL departments just does not get heard.
For 2014 Ashley, how about inviting some of them into management or, God forbid, board meetings? Explain some of the unpalatable truths about the business and open the meeting to them – you might be surprised?
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I appreciate the AH has inherited this debt and must reduce it, but the reliance on digital to make up for lost print readers is unrealistic. Nobody I know that has stopped buying both local papers is reading them online. There is no transfer from one platform to another. I know someone who rang to cancel her subscription of the paper, was asked why, (“not as good as it used to be”) and the person who took the call made no attempt to explore further the opinions of a reader, or in what area(s) in particular she thought needed improvement. It used be called ‘customer care’. If the company is letting its readers go so readily, what hope of getting them to sell the products to new readers? Once this would have been achieved employing the skills of an in-house creative department, but they no longer exist to do such work.
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You would think so, Cynical, but then isn’t that happening already? I thought audience of local newspapers was on the increase they just prefer to consume online – but then why wouldn’t they when they can access content free!
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I agree, ‘cynical’, there is a definite need for local media to invest time and energy in marketing activity to support their newspapers and websites. This should include an ongoing campaign to help local residents understand what’s at risk if the local newsbrand folds. One of the stats to use would be how many journalists the local publisher employs in the town/city versus the numbers employed by the BBC and/or commercial radio in the same location.
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Highfield really needs to scrap the atex shapes system, stop reporters being cheap photo processors, video shooters and box fillers and get them researching and writing proper Local stories. He’s now running out of staff though.
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Happy New Year to all remaining JP staff – and to those about to bid the company farewell under the enhanced voluntary redundancy scheme. Sadly, this continual trimming of jobs leads to a reduction in quality in the product and a lack of morale in the staff; the empty, echoing offices are a sorrowful symbol of how a company overstretched itself to the detriment and cost of hard-working journalists. How user-generated content will match the efforts of editorial staff, who were praised in an email from Ashley after the axe was swung for the final time in 2013, I don’t know. Good luck and best wishes to those who remain.
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Here’s to a better 2014, also, to those ex-JP staff, from various departments, (not just editorial) who lost their jobs without enhanced voluntary redundancy. With the workload for remaining staff surely increasing, they must appreciate that they are still in a job, difficult though that may be.
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Isn’t the issue that Johnston, Newsquest
&Trinity own obsolete products that have
no future?
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Yes well done AH for buying time, trouble is all his plans are causing damage that will lose more readers during that time. Newspapers losing front offices, paper sizes decreasing, papers filled with pictures of blurred robins and sunsets as the staff snappers go. Newspapers aren’t dying, they are being killed by the very people entrusted to look after them. Local papers get their money through adverts and as such all ad staff were not allowed to apply for redundancy but what product will the ad staff have left to sell when the editorial staff have all gone. Advertisers won’t pay the current rates (if at all) so more revenue out the window along with the last remaining readers…..but it’s ok the web will save us!!!!!!
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Sales reps not only have to sell into print products that are poorer when templated and with fewer editorial and photographic staff, but have to do it without the benefit of creatives that, in the past, could design from a basic visual brief, not following implicit instructions from the rep. They should be good, professional salespeople, not necessarily creative. Local papers get their revenue through ads, but JP doesn’t seem to appreciate the value of creative designers, just cheaper ones. As the economy (hopefully) continues to improve and retailers have more advertising budget, JP won’t have suitable staff to benefit from it.
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If anyone has shares – sell them now
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