Johnston Press operating profits rise 4.3%

NEWSPAPER group Johnston Press, publisher of The Scotsman, has reported its first rise in first-half operating profits for seven years.

The company, which also publishes Scotland on Sunday and the Edinburgh Evening News, said it had been driven by £24.3 million in cost reductions and a strong rise in digital revenues.

Chief executive Ashley Highfield said the Edinburgh-based group had made “good progress” during the six months to 29 June, with a number of print titles relaunched and increased investment in its websites, combined with a “tight control” on costs.

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He added: “It is encouraging to see the benefits of our actions starting to come through, with the group achieving its first like-for-like operating profit increase in seven years.”

Like-for-like sales fell 9.8 per cent to £144.3m, with total advertising revenues down by 13.6 per cent, but Highfield said the decline slowed to 6.3 per cent in June and July, compared with a slide of 17.6 per cent seen at the start of the year. The group’s stable includes 13 daily newspapers and more than 150 weekly titles.

Improved margins and a 13.3 per cent increase in digital sales pushed like-for-like operating profit to £28.6m for the first six months, up 4.3 per cent on a year earlier.

The company paid off £55.3m of it debt to reduce the total by more than 15 per cent to £306.4m. But a £194.5m writedown on the value of its publishing titles contributed to a pre-tax loss of £248.7m for the first half, compared with a £13.6m profit a year earlier.

Analysts at Panmure Gordon said the figures came in ahead of their expectations and the broker has pencilled in an annual operating profit of about £58m, up from £57m last year. Shares closed down 0.25p at 15.75p.