Government cuts crack Trinity Mirror

 

The owner of the Mirror and Sunday Mirror newspapers warned that the government's austerity drive has hammered its advertising revenues.

Sly Bailey

Sly Bailey: Trinity boss will continue clamping down on costs

Trinity Mirror revealed that public sector ad spending had plummeted 47% between January and April as the Coalition began tackling Britain's gaping budget deficit.

The pull-back by the government and local authorities - which are among the biggest buyers of ad space - sent the group's ad turnover down 10% over the period.

The 'fragile economic environment' has also hit sales, with a weak labour market slashing recruitment ad turnover by more than a fifth at its regional newspaper wing.

The warning came just days after rival Johnston Press, which owns The Scotsman, reported a 30% plunge in its 'situations vacant' revenues due to the public sector cuts.

Trinity Mirror, headed by chief executive Sly Baily, pictured, vowed to continue clamping down on costs and raised its savings target for this year by £5m to £15m.

At its annual shareholder meeting, Trinity Mirror said: 'Whilst the trading environment remains difficult, the group continues to benefit from on-going initiatives to drive efficiencies through.'

Its debt pile increased by £20m to £286m, although it is expected to fall over the remainder of the year.

Ad revenues at its national newspaper division slid 9%, with turnover from circulation down 5% over the period.

Shares in Trinity Mirror fell 1.75p to 50.125p and have lost around 30% of their value since the start of the year.