Johnston Press plc says: We are pleased to confirm that the Group achieved Adjusted EBITDA for the period of £57.3m, in line with expectations. The Group traded well in the first quarter, while the second quarter was impacted by a sector-wide slowdown which continued through the second half and into 2016. Cost savings substantially mitigated revenue declines; and the benefit of reduced financing costs (down 34.1%) resulted in improved profit before tax and earnings per share. We continued to invest in our digital products and platforms. We reduced our pension obligations by £63m to a closing IAS19 deficit of £27m.
We are also pleased to confirm that the proposed acquisition of the i was approved at a general shareholder meeting held on 21 March 2016 achieving 99.85% of votes cast in favour. We look forward to completion on 10 April 2016 and the opportunities it brings to accelerate the transformation of the Group.
Key highlights:
Growing digital audiences
Digital audience grew by 40.7% year on year to 22.6m Unique Users in December 2015 (2014: 16.1m). Total monthly audience across print and online grew 19.8% to 31.9m in December 2015.
Growing digital revenues
Total digital revenues grew 12.4% to £30.6m for the period, representing 20.6% of advertising revenues (2014 FY: 16.9%) with revenue from the key strategic category of digital display advertising up 26.7%.
Continued cost reduction
Total operating costs were reduced by £13.6m (6.7%) after investment in digital of £6.0m. (2014 cost reduction: £13.8m)
Increased profit before tax
Adjusted profit before tax increased 22.6% to £31.5m (2014: £25.7m)
Increased EPS (fully diluted)
EPS increased by 30.1% to 21.2p
Continued debt reduction
Cash generated of £14.8m reduced net debt to £179.4m (2014: £194.2m)
Financing Costs
Interest cost reduced to £19.1m (2014: £29m)
Pensions
Pension deficit under IAS19 has reduced by £63m (70%) to £27m.
Acquisition of the i (to complete 10 April 2016)
Gained shareholder approval yesterday. The acquisition will be earnings enhancing.
Ashley Highfield, Chief Executive, commented: “The challenging trading conditions experienced in the second half of 2015 have continued into Q1 2016. We have reduced costs to maintain profitability, reset our portfolio and refocused on priority markets with attractive audiences that offer the best opportunity for growth. Success in driving our national display advertising business in 2015 and the rollout of our local display advertising Sales Force initiative gives me confidence for the future despite the fact that the market remains difficult.
“The acquisition of the i newspaper is also incredibly exciting for us. It gives us scale, with a combined JP plus i daily print circulation of over 600,000 papers making us the UK’s 4th largest news publisher, and thus numerous revenue and cost synergy opportunities. Further, not only will the i contribute positively to earnings but it will allow us to accelerate growth in digital, and help stabilise our circulation revenues. In conjunction with the planned asset disposals this will enable us to continue to reduce debt levels and cut financing costs further.”
