The trading update from Johnston Press:
The Board confirms that (subject to audit) the underlying EBITDA, and net debt, for the 52 weeks to 2 January 2016 are in line with expectations. The 2015 preliminary results will be announced on 22nd March 2016.
Underlying total revenues for the 52 week period fell 7% year on year.
Underlying digital revenues were up 12%, whilst publishing revenues fell 8%, with print advertising revenues down 12%.
Digital audience growth remains a priority and the number of unique users has grown to 22.6m in December 2015.
National display revenues (print and digital) were up 3% year on year driven by a 99% increase in revenue from 1XL, our digital advertising exchange partnership, while local display revenues were down 7%. The group increased focus on larger SME customers, with high spending customers in 2015 increasing their spend by 17% year on year during 2015.
Media Sales Centre transaction revenues (including Public Notices, Births, Marriages and Deaths, and Central Display) were up 1% year on year, while former classified categories of Employment, Properties and Motors were down 13%, 17% and 11% respectively.
Contract printing revenues were flat year on year, the benefits of winning the printing contracts for the Daily and Sunday Express and Star, being offset by circulation decline in existing contract titles.
Circulation revenues were down 7% year on year, while circulation volume decline rates improved by 1.5% for daily titles and 2.6% for weekly titles from the start of 2015 to the end.
The Group announced an internal management restructuring on 1 December 2015, removing a layer of regional management. This will enable the Group to prioritise investment in growth markets while delivering a consistent advertising solution to both National and SME display advertisers across the portfolio. The alignment of editorial under a single Editor in Chief, will also ensure content sharing is optimised and a clear consistent approach to delivering content to audiences online, on mobile, via social media and in print.
Asset Disposals
As part of the Group’s portfolio review, a number of brands have been identified that are not part of its long-term future, as they fall outside its selected markets, or do not match the audience focus, or do not offer the levels of digital growth sought by the Group. A process has been initiated to explore the sale of these assets to identified parties.
If the disposal process is successful in realising appropriate value for the assets, proceeds will be used to fund on-going investment in preferred markets and to further deleverage the Group.
Strategy
The Group has clear plans to drive revenue and make further cost reductions in 2016, guided by a strategy that prioritises our display advertising products (both local and national), and focuses on growing digital revenues in key economic-growth geographies and with key audiences with more disposable income.
