Johnston Press ad sales hit by government cuts

Regional newspaper publisher Johnston Press posted its first underlying operating profit increase in seven years today but warned the economic outlook for 2011 remains uncertain.

The group, which has titles including the Yorkshire Post, posted its first underlying operating profit increase, excluding acquisitions, since 2004 after taking out costs and boosting digital advertising revenues.

But it said that government spending cuts knocked its advertising sales at a sharper rate than in 2010. Total advertising for the first nine weeks of 2011 fell 11.4 per cent compared with a drop of 6.4 per cent for the whole of 2010.

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“The pace and consistency of the economic recovery remains uncertain and this is reflected in a weaker start to 2011 than we had anticipated,” chairman Ian Russell said in a statement.

The group also said it would start looking for a new chief executive after John Fry said he would step down from his role by March 2012.

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