A silver lining for Johnston Press

The latest results are out this morning for Johnston Press.

The regional newspaper publisher has reported that operating profit fell to £71.8m for the 53 weeks ended 2 January 2010 from £128.4m the year before. Revenue fell to £428m from £531.9m.

However a little bit of a silver lining as advertising revenues appear to be reversing their falling trend,as the rate of decline reduced throughout the period with the first quarter down 33.9 per cent and the final quarter was down 11.2 per cent.

According to their chief executive

The year ended with the group in a much stronger position than it began: advertising is more stable; circulation trends have improved; digital revenues are growing; our cost base has reduced significantly and we have renegotiated finance facilities for 3 years."

The compnay also confirmed that debt reduction was its biggest priority.In accordance with the provisions of its revised financing arrangements, no dividend is proposed for the year.

Luckhurst stands behind Johnston Press' paywall

I see that Tim Luckhurst's article on Comment is Free has collected a fair amount of comment

Johnston Press alone cannot restore sanity. But the experiment it is launching should remind us that information required to hold power to account cannot be produced free of charge. Good journalism supplies the raw material without which freedom of conscience becomes meaningless. Ensuring its supply is essential.

he writes adding that

The internet is a valuable tool. It can bring inspiring, diligent and creative reporting into every home. But it will not do so by obliging consumers to accept the shoddy, propagandist ranting some categorise as citizen journalism and less credulous critics recognise as a deplorable reversion to the days when news was always deployed as a political weapon and only occasionally reported.

Last throws of the dice for Johnston Press

I think that paid content's Patrick Smith sums it op quite well

If readers will only pay for content that’s unique and unavailable elsewhere, perhaps local sites have a distinct advantage in their patch and, in theory, a clear path to monetisation.
—But what if a rival publisher in the same town keeps their content free? Unless there’s a huge gulf in quality between local rivals, readers will have a very easy choice. Our paid content research showed that 95 percent of people would rather go elsewhere than pay for news online.

He is talking about Johnston Press deciding to roll out a paid content model.

A leaked memo via Hold the front page says that

Managers have told staff that JP intends to roll-out the paid-for model across the company in line with what they are calling "industry moves in this area to find a sustainable business model going forward."

Whether this is a suitable business model or the last throws of the dice of a beleaguered media group,we wait to say.

The fall of Johnston Press continues unabated

Regular readers of this blog will note that I take a great interest in the fortunes of Johnston Press.

The reason is that from the start of my journalism degree at Uclan back in September 2006,their association with that university and the fact that their decline and fall has almost mirrored that of journalism.

They were held up as pioneers of the direction that the local newspaper industry was going,that it would survive only by the intervention of conglomerates and the rapid introduction of technology.

Well three years later a lot has happened,the departure of its chief executive,renegotiation of debt,speculation about selling titles and redundancies.

Today the group has released its interim results for 2009 which has seen its pre tax profits fall by 56.1 per cent to £27.5 million in the first six months of 2009.

During the same period revenues fell by 25.4 per cent while advertising revenues fell 32.7 per cent.

The debt ridden company has also announced a new three-year £485m financing deal.

Its chief executive officer,John Fry said:

"The timing of the economic upturn remains uncertain but advertising revenues are demonstrating greater stability and we expect the cyclical improvement when it comes to more than compensate any ongoing structural change. We will maintain our focus on costs and look to secure additional operating efficiencies during the second half of the year."

The folly of some of its acquisitions is also very apparent.These latest results showing a write down of £126m on its titles,that means that since January 2008 it has written off a massive £543.5 million.

Speculation is rife that the group will need to be slimmed down and over the last few days it has been rumoured that the group is looking to sell the Scotsman group.

So far it has reduced overheads through headcounts and what it describes as a centralisation of functions.

It will be interesting to see where this group goes from here

Moves afoot to rescue the Scotsman

The Sunday Times is reporting attempt by a business consortium to rescue the Scotsman from the grip of Johnston Press.

According to the paper

Talks have taken place in recent weeks but the two sides are believed to be a long way apart on price. Industry sources say Johnston is holding out for about £40m for The Scotsman, which it bought from the Barclay brothers for £160m in 2005.

adding that

Johnston’s acquisition of The Scotsman was seen as the crowning glory of a buying spree that had taken the company from a family-run player to one of the country’s largest regional publishers in barely a decade.
In reality, it was one of several deals too far for the group, which is locked in talks with lenders to reset the borrowing terms on £450m of debt by August 31.

Johnston Press bans Facebook

Can someone please explain why a newspaper company would ban their staff's access to Facebook?

Well Johnston Press have according to this report from Paid Content

In a memo, (via Allmediascotland), JP management warn reporters that “a recent review” found more than half of the company’s entire outbound traffic is to Facebook so it has no choice but it stop people visiting. the Memo reads: “Journalists who require access should seek approval from their departmental head, who should contact the Group Helpdesk to have the permission restored.”

adding that

Just like Friends Reunited before it, Facebook has become a standard reporting tool for many local and regional reporters—one JP journalist told me recently they couldn’t imagine working without it.

Have local papers been too digitally successful

Interesting piece from John Slattery at the Wire who quotes media analyst Enders who says that

Many local publishers are accelerating their decline by ‘doing too much too well’ in terms of digital news provision at the expense of the quality of their newspapers,

They were looking at Johnston Press' results released earlier in the week.The group has prided itself at being at the forfront of convergence yet is teetering on the brink of disaster.

Johnston results show the reality for local papers

This morning brings more bad news for Johnston Press.

The group heavily involved in local and regional newspapers has been hit hard by the slump in classified advertising reporting that revenues have dropped 36 per cent so far this year.

Reporting results widely predicted with operating profits down 28 per cent,it has announced that it has scrapped its final dividend for 2008.

Revenues for last year were down 12 per cent and the group has written down the value of its titles to the tune of £417m.

One bright spot was its reduction of debt which stood at £476m compared to £691m in the previous year on the back of equity releases.

The results will still raise issues about the companies ongoing viability with the group's next test in June when its borrowing covenents will once gain be tested.

The only real option for the group would be to continue to dispose of its assets but shareholders will question this approach in the current climate as they will be sold at well below their bought value

The continuing demise of Johnston Press

is reporting in the papers this morning.

Its Irish titles are being put up for sale in order to raise an estimated £70m and allow it to pay down some of its enormous debt.

According to the FT-

A formal prospectus will be issued in the next few days, according to those familiar with the deal. The titles are expected to be sold for a fraction of the original investment.

The group paid around 317m euros for the newspaper assets of Scottish Radio holdings,various local papers and the Leinster leader titles during a frenzied attack on the Irish market

Johnston Press to rename reporters content gatherers

That's according to Press Gazette's Grey Cardigan who reports that

A cleft stick arrives from Northampton, where a Johnston Press source reveals that news reporters are about to be re-named ’Content Gatherers’.
Presumably this is on a par with their ‘Life is Local’ titles being subbed 60 miles away by people who have never even set foot in the place. Madness!

This seems to be a trend amongst companies for renaming jobs.The other day I found out that Northern Rail now call their green jacketed ticket collectors-revenue enforcement officers-what next?

Johnston,Trinity and Mecom all drop out of 250

The fall in the share prices of the newspaper industry has seen Johnston Press,Triniy Mirror and Mecom all fall out of the FTSE 250.

After yesterday's culling of the index,Trinity Mirror was ranked 403, Johnston was at 540, and Mecom at 712.

It marks another black day for the media industry.

More problems for Johnston

the best case scenario for the company would be a debt refinancing on “more onerous terms”, although added that this may only provide a temporary breathing space “should the downturn be prolonged”.
The worst case scenario,would be a “covenant breach and debt for equity swap”, which would wipe out what remains of the current equity value.
“While the shares have already fallen a long way, a more positive recommendation will only be appropriate once refinancing is completed and/or there are some signs of stabilisation in advertising revenue,"

No it's not a bank but Johnston Press and the commentator is Lorna Tilbian executive director of Numis Securities (via Press Gazette)

Now there is more speculation about the group whose share price is now in single figures as investors fear it is too heavily geared.

Rumours abound that its Scottish titles are up for sale.According to Roy Greenslade

Two usually reliable (but, admittedly, occasionally unreliable) sources yesterday told me that the papers were "being touted around" by their owners, the beleaguered Johnston Press (JP). One even named a price: £30m.

And as Roy says

If true, this would be an astonishing story. JP acquired The Scotsman, Scotland on Sunday and the Edinburgh Evening News three years ago from the Barclay brothers for £160m.

Bowdler on the digital future for the locals

It is interesting to read the remarks of Johnston Press supremo Tim Bowdler at the WAN conference.

Central to the development of our digital capabilities has been an overriding determination for each and every one of our local editorial teams to embrace digital channels as an integral means of engaging with their local communities",We want our websites to be regarded as an extension and complement to our print publications, thereby extending audience reach and the advertiser offering."

And good to see that this regional conglomerate still has its eyes firmly on local issues