Trinity shares hit by ad sales woe
Trinity Mirror shares plummeted 15.5% today after it revealed recent advertising sales had taken a big hit from the fragile economy and uncertainty over Government cuts.
Daily Mirror: Ad sales slide in September
The Daily Mirror owner said advertising revenues from national newspapers declined by 5.9% in September, although they increased by 0.8% in the earlier part of the third quarter. Adjusted group revenues were down 5.4% in the 17 weeks to 31 October.
The shares fell by 16.25p to 88.5p by afternoon trading.
The publisher said: 'Trading since the half year has remained volatile due to the fragile economic environment and the uncertainty resulting from the Government spending review.'
It added that although September's advertising sales were below recent trends, the rate of revenue decline had improved to 2% in October.
Yesterday, regional newspaper publisher Johnston Press blamed public sector cutbacks for a worse than expected 5.4% decline in like-for-like advertising sales in the last quarter.
In Trinity's regional newspaper estate, which includes the Birmingham Post and the Liverpool Echo, adjusted revenues were down 6.7% for the quarter, an improvement on the 8% decline in the first half.
Trinity's overall sales, which include revenues from its March acquisition of Guardian Media Group, were up 4% in the quarter. Total advertising sales were up 13% although circulation revenues were down 4%.
The company bought GMG's regional businesses, which include the Manchester Evening News, for £7.4m.
It said it is still on target to cut costs by £25m in 2010 even though newspaper printing prices have risen in the second half of the year. In 2009 it stripped out £67.9m in costs through 1,700 job cuts, a group-wide pay freeze and IT efficiencies.
The company paid down £20m of net debt since the end of the half year. The figure now stands at £288m.
Trinity's sales for the first half of the year were flat at £382.2m, while its pre-tax profits increased by 165% to £87.2m.
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