Advertising revenues are suffering, wars Trinity Mirror
Austerity bites back: Trinity Mirror has warned that advertising revenues have been hit by government spending cuts
Trinity Mirror became the latest newspaper publisher to warn that advertising revenues have been hit by Government spending cuts.
Shares in the Daily Mirror and Sunday Mirror owner tumbled 15 per cent after Trinity revealed that revenues dropped 5.4 per cent in the four months to the end October amid uncertainty over the austerity cuts.
The warning came just a day after Scotsman-owner Johnston Press blamed the public sector clampdown for a 5.4 per cent slump in advertising sales in the last quarter, which sent its shares to a 19-month low.
In a trading update, Trinity reported a 6.7 per cent fall in underlying turnover at its regional newspaper wing, which includes the Birmingham Post and the Liverpool Echo, while national advertising sales fell 1.3 per cent.
Lorna Tilbian of stockbroker Numis said: 'As reported by Johnston Press there was considerable advertising volatility around the comprehensive spending review which affected business confidence and therefore advertising.'
The gloomy prognosis would 'dampen' hopes of a rise in Trinity's dividend, said Tilbian. Trinity (down 16p to 88.75p) said it remained on course to cut costs by £25m in 2010.
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