Trinity Mirror has seen a 10 per cent drop in advertising revenue since the beginning of the year.
In an interim management statement issued today – covering the 17 weeks of trading to 1 May – the company said the’trading environment remains difficult’but it was continuing to ‘drive efficiencies”.
This has seen the group increase its structural cost savings target for 2011 by £5m to £15m.
The statement said: ‘The trading environment remains challenging due to the fragile economic environment and the adverse effect of public sector spending cuts and tax increases.
‘These factors continue to adversely impact the key drivers of our business, such as consumer confidence, unemployment and the property market and are contributing to revenue declines.”
The company’s net debt has increased by £20 million to £286 million since 2 January 2011, which reflected the £33 million of pension deficit funding payments made at the end of March.
Net debt is expected to fall over the remainder of 2011.
Revenue from Trinity Mirror’s regional portfolio rose by 8 per cent and digital revenues grew by 10 per cent.
Recruitment advertising fell 22 per cent but digital recruitment advertising was up 6 per cent.
In the nationals division, advertising revenues fell by 9 per cent and circulation revenues dropped by 5 per cent.
The statement continued: ‘We are encouraged by the improved circulation volume performance with year-on-year volumes performance for most titles being in line or ahead of market trends.’