As reported by Johnston Press:
The Group and sector has continued to experience challenging advertising trading conditions during the period, although the second quarter prior to the referendum over membership of the European Union showed signs of improvement.
The Group achieved adjusted EBITDA for the period of £25.5m, with cost savings substantially mitigating revenue declines.
Whilst the Board is encouraged by the improved Q2 performance in several parts of the business, overall performance for the 26 week period ended 2 July 2016 was marginally below the Board's expectations. In light of the added market uncertainty following the referendum vote, the Company is now focused on revenue and cost measures to maintain margins and minimise the impact of a difficult trading environment.
Ashley Highfield, Chief Executive, commented: “The acquisition of the i newspaper in April was transformational for Johnston Press. Since the acquisition we have increased circulation considerably, using the extensive JP distribution network, and continued to grow market share. Perhaps more significantly, owning the i newspaper is enabling us to present the whole JP portfolio, and the 1XL digital advertising network, to media buying agencies and clients afresh. Further, we have started to see significant content sharing between the i and the rest of the portfolio.
The market continues to be challenging and uncertainty surrounding the outcome of the Brexit negotiations has caused further softness in some segments of the advertising market, in June and July.
Nevertheless, we are focused on our strategy of increasing overall audiences, maximising opportunities for the i, maintaining tight cost control and rebalancing our portfolio. In that respect, we are nearing completion of the disposal of our Isle of Man newspaper group for £4.25 million and are well advanced in negotiations for further divestments.
The divestment plans, alongside the strategic implementation of key initiatives such as Salesforce of the Future, will put Johnston Press on a stronger footing for the future, focusing on key geographies, audiences segments and higher yielding advertisers, and will enable us to continue to reduce debt levels and cut financing costs further and prepare the business for refinancing due by 2019.”
