Johnston Press hails rise in operating profit

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Johnston Press, the publisher of The Scotsman, reported its first increase in operating profit for almost seven years and said it was on track for a strong performance in 2013.

The Edinburgh-headquartered company said it was seeing the benefits of cost-cutting through a restructuring of the business last year and the relaunch of 183 of its titles.

As well as a rise in operating profits for the 18 weeks to 4 May, it said it was in line to reduce costs by £20 million during 2013.

Chief executive Ashley Highfield said while the economic environment continued to be challenging, the period had seen the implementation of the company’s strategy “progress further with the successful completion of the relaunch of the vast majority of our titles”.

“With our reduced cost base and our continued focus on debt reduction, we remain on track to deliver a strong performance in 2013,” said Highfield.

Total revenues fell by 11.4 per cent on a like-for-like basis, although the company said that the revenue declines were slowing month-on-month.

Digital audience growth has continued, with monthly website visitors for April showing a 16.4 per cent year-on-year increase to 11.6 million.

The company’s focus on reducing its debts benefited from a £10m cash receipt from the cancellation of a print contract with News International.

Iain Daly, analyst at Edison Investment Research, said although the operating profit increase was a “major plus point”, the full-year outlook

“remains cloudy with further digital growth required in order to stave off further earnings downgrades”.

Shares in the company, which has seen its market value treble over the past 12 months, closed down 0.75p at 18.25p.