Trinity Mirror: Profits down 31% but decline slowing

Trinity Mirror has reported a year-on-year fall of 31.4 per cent in operating profit in the first half of the year as advertising revenue in its regional publishing wing tumbled.

The UK’s largest publisher of regional newspapers, whose titles include the Birmingham Mail and the Liverpool Echo, recorded operating profits of £49.1m in the first six months of 2009, down from £80.5m in the same period the previous year with a drop in advertising revenues of £65.6m contributing to the fall.

The company said advertising had dropped to an unprecedented level during the downturn but reported that marginal improvements were visible as the year progressed, with notable improvements in July’s figures, and it expected this to continue for the remainder of the year.

It said that only a substantial reduction in costs limited the impact of falling revenues on operating profits. Total costs were down by £46m in the period with costs expected to fall by £65m for the full year.

Advertising revenue from its regional newspapers fell 34.5 per cent year-on-year to £104m, coupled with a fall of 14 per cent in ad revenue at its national newspaper operation overall ad revenue across the group dropped 28 per cent to £168.4m.

Circulation revenue proved to be steadier falling overall by just 4.2 per cent to £169.8m.

Total revenue in Trinity Mirror’s regional division fell 28.2 per cent to £155.4m with revenue at its nationals falling just 6.9 per cent to £227.6m.

In the regional division print revenue fell 29.3 per cent to £139.2m with digital revenue falling 16.9 per cent to £16.2m. Operating profit fell 66 per cent in print and related activities to £13.5m and in digital by 34.5 per cent to just £3.8m. Total operating profit for the regional division was £17.3m, a drop of 62 per cent from the £45.5m in the first half of 2008.

Operating profit in the nationals division fell 10.5 per cent to £38.2m.

Overall group revenue dropped by nearly £80m from the £460.8m it recorded in the first half of 2008 to £383m in the same period this year, a fall of 16.3 per cent.

Trinity Mirror said in July it recorded year-on-year revenues fall of 13 per cent with advertising and circulation revenues declining by 23 per cent and three per cent respectively.

Advertising and circulation revenues fell year on year by 29 per cent and eight per cent respectively for the regionals and ten per cent and one per cent respectively for the nationals.

Sly Bailey, chief executive of Trinity Mirror, said cost saving measures, coupled with new IT and resilience in circulation revenue positioned the group for post-recession growth.

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