Johnston Press reports a 47.5% drop in pre-tax profits

Johnston Press has seen pre-tax profits drop in the first half of the year to £13.8 million, down 47.5% year on year.

The regional publisher has been forced to cut almost 180 staff as ad revenues plummet 10%. The group’s total revenues fell by 7.5% to £191.8 million.

Total ad revenues were down by 10% in the first half of the year, though national display ad revenues were up 2.8% year on year.

Digital revenues, which fell by 5% overall in the first six months, returned to growth in May and have continued to improve. The first quarter saw digital revenues fall by 9.7%. In Q2, digital revenues were down just 1.5%. July saw a rise of 6.8%.

The company said that newspaper sales revenues remained “resilient” – they were down just 1% in the first half to £48 million despite circulation (of daily titles) falling 7.8%. Weeklies were down 6.8%.

Total costs were cut by £8.3 million year on year, despite newsprint prices rising £4.2 million. The publisher reported an operating profit of £32.6 million – a 25% year on year decline. Johnston Press reduced net debt by £16 million to £370 million.

John Fry, Johnston Press’ outgoing chief executive, said: “We remain cautious about the advertising outlook for the second half of the year. The board has confidence that, in the absence of a further significant deterioration in the UK economy, the outcome for the group in 2011 will be broadly in line with current expectations.”