Advertising Upturn Helps Johnston To Prosper

The ‘modest’ growth seen in the first quarter (see Johnston Press Remains ‘Acquisitive’ As Profits Rise) has been maintained throughout April and May. Advertising revenue is up 2% in 2003, in line with Merrill’s full year forecast (see Consumer Dip May Put Squeeze On Johnston Press, Say Analysts). In particular, property advertising remains strong and recruitment is showing positive signs again.

Concerns have been raised over the state of the regional press market (see Conditions ‘Overwhelmingly Negative’ For UK Regional Press) but circulation figures at Johnston have remained constant with growth among weekly paids compensating for a decline in daily evening sales. Merrill Lynch believes that cover price increases will enable circulation revenue growth of 1.5%.

Johnston completed the takeover of Regional Independent Media in March 2002 (see Johnston Press Acquires RIM Newspaper Business) and has set a target of £9 million of annualised synergies from the acquisition. The firm continues to court small independent publishers and is likely to show an interest in Trinity Mirror’s regional portfolio should it become available. However, competition regulations may preclude any move for the titles.

Shares in Johnston Press were up 10p at 397.5p by mid-afternoon today.