It's an increasingly difficult climate for publishers at the moment, but Johnston Press is battling on – announcing a rise in adjusted pre-tax profit for 2015 (despite falling sales).
Profit increased 22.6% to £31.5m, while revenues dropped 6.8% to £242.3m. Cost-cutting paid off though it won't have endeared the publisher to any of its journalists... Total operating costs were slashed 6.7% to £191.7m. The regional publisher has also warned there could be more cutbacks on the horizon.
Johnston said it had identified ‘a number of news brands now considered non-core’ which ‘will be either divested or run with less costs’. Print circulation of the 220 regional and local titles is in a downward spiral and improvements online haven't offset this.
While the number of people reached through Johnston's titles was up 40.7% to 22.6m and digital advertising revenue was up 12.4% to £30.6m, the publisher's print revenues were down nearly 10% to £193.9m. Online media itself is another difficulty for traditional publishers to deal with, since it has meant so many other sources of news cropping up and making everything that much more fragmented.
But CEO Ashley Highland is probably still in fairly good spirits considering this all comes after agreeing a £24m acquisition of the i newspaper. Highfield said this gave the publisher ‘scale, with a combined Johnston Press plus i daily print circulation of over 600,000 papers making us the UK’s fourth largest news publisher’. It’s an interesting tale of optimism alongside the apparent sorry state of the newspaper industry – the circulations of all nationals declined in 2015 against the previous year, bar a small rise in sales for The Times. The i has been a surprise success in that sense and Highfield has ambitions to get circulation up further.
Where the title may get a boost is from picking up the stragglers left behind of the Independent readership. That will be some 50,000 readers who will be without a daily newspaper to read – it’s not a stretch to think a decent swathe will opt for the bite-sized version. Highfield has also said he’ll recruit some of the Independent’s leading writers such as Grace Dent and Robert Fisk to the i in an effort to make the transition less jarring and the surviving title more appealing to new readers.
There’s encouraging scope for progress here which Highfield feels should ‘stabilise our circulation revenues’. It doesn’t though provide much of a solution for the raft of other titles which come under the publisher’s umbrella – it owns The Scotsman, The Edinburgh Evening News and The Yorkshire Post as well as various local papers and sites. Waning interest in regional news contributed to the decline in revenue.
Johnston is at least trying new approaches in its efforts to keep afloat against a difficult media landscape. It won't secure a sustainable future for all of its titles, but today's news has been enough to keep investors happy – shares were up 17% this morning to 47.82p.