Newspaper publisher Trinity Mirror has revealed it is ahead of target on its cost-cutting plans as its latest trading update showed revenues continuing to decline.
The group said it had made structural cost savings of £20m in the current year, £5m ahead of its initial target.
With the third quarter of the year just ending, the group is anticipating year-on-year revenue decline of 9pc in the period July to September compared to 8pc in the first six months of the year.
Publishing revenue is expected to fall by 10pc, with print revenue down 12pc and digital revenues up 11pc.
Most of the publishing revenue decline was accounted for a fall in advertising revenue which was down 21pc while circulation revenues were down 6pc.
However with digital audiences continuing to grow, the group delievered “strong growth” in digital display revenues which were up 24pc.
The update said: “Although the trading environment has remained challenging during the third quarter of the year, our continued focus on growing digital revenue and driving efficiencies, provides the Board with confidence that profit for the year will be in line with market expectations.
“We continue to make good progress against our strategic initiatives and the business continues to deliver strong cash flows supported by structural cost savings of some £20 million for the year which is £5 million ahead of our initial target.”
The planned cost cuts included £12m of “synergy savings” from the integration of the Local World titles purchased in a £220m deal last November.
The ongoing restructure of the group’s regional operations has so far seen around 80 jobs lost or placed at risk.
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Very cleverly presented, but read closely and you’ll see this is not good news. It merely means TM is AHEAD of its cost-cutting extravaganza, not that it will cease and desist with the axe-wielding because it’s managed to cut £5million more than it thought it was going to. And around 80 jobs lost? I find that very difficult to believe. There’s getting on for 20 gone from my neck of the woods alone.
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Given all the sacrifices made at the altar of digital, why is it not delivering enough revenue? Who is being held accountable for the failure of all these website clicks and Facebook ‘likes’ to prevent revenue from continuing to tumble?
And, most important of all, if there is no realistic prospect of digital revenue ever being enough to support local media, why is it still being persued so aggressively?
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As 1 of the 80, should I feel a sense of achievement or pride that I’ve helped Trinity achieve their goal early?
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Because eventually, User Generated Content, it will be the only source of revenue. I can’t believe people are still asking this question.
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Part of this ‘cost’ saving, as well as major editorial cuts is wiping out over 50 creative jobs from local world centres. And as is typical, playing the short game and not thinking of the losses that will come when advertisisers drop their spend due to a lack of creative campaigns and professional service. Seems like anothe nail in the coffin for print, no advertisers means no newspaper.
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80? It is far more than that. The back office, support and commercial restructuring is often not highlighted or reported. A commercial restructure happened in August under the radar with 6 management jobs lost and 3 commercial directors reduced to 1 for the region and the removal of telephone and field sales managers putting more pressure on the revenue generation which is tumbling rapidly.
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To quote Jack Nicholson in As Good as it Gets: ‘I’d be the luckiest man alive if this did it for me’.
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bewiseandgetout
it sounds as if someone is taking the right action then if the number of sales managers and commercvial directors are being reduced as,unless they contributed to the bottom line revenues and prtofits by actually creating revenue they were ,like many others across the industry a drain on the company.
Too many news groups are weighed down with deadweight ” managers” “commercial chiefs” ” ad managers” and such like that to hear of one group taking the action that many have called for gives me the slightest crumb of comfort in an otherwise dire situation
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Archie – such a tactful reply – I’m sure if you were one of the “deadweight managers etc” you would be happy to be described as such. Why is it ok for support / advertising staff to be culled, but an existential crisis if it happens to a journo.
Having been a ‘support staff’ (within circulation who are the lowest of the low in the pecking order of things!!!) this type of attitude is not helpful. Thankfully I’m out of the horrible cycle of cuts, redundancies, shrinking pagination, more cuts etc.
The whole industry is on it’s knees. In the current times of falling revenues (both advertising and circulation) it is inevitable that there will be significant cuts. I personally think the big groups are hastening the whole cycle, and ultimately destroying the industry as we know it. We need local ownership, where everyone is working together – these papers are still profitable and important within the communities, however when the owners are shareholders they are not concerned with the long term welfare of the business – they just want to make their money and move on to another cash cow.
The only way for the industry to survive is to produce products that customers want to read – that means relevant editorial, good quality local and national advertising, and doing everything possible to make the reader want to buy the product (here’s an idea – don’t give it away free on the web!!!!). The glory days are gone. But there is still a want and need for papers – however, we need to be realistic and staff up according to what the individual business can afford. The future will be much smaller than the past, but let’s be honest – if you were around in the glory days you’ll recall 3/4 hour lunches and unlimited expenses. We never had that in circulation, but that was something both advertising and editorial used to like!!!
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