Newspaper publisher sheds more jobs as sales decline battle continues

The Daily Mail and General Trust said it reduced the headcount in its national and regional newspaper division by a further 188 jobs in the first two months of 2011, taking total job losses to 520, or 7 per cent of the workforce, in the five months to the end of February.

Its Northcliffe Media arm, which includes some 100 regional newspaper titles, took the brunt of the cuts with 317 job losses as revenues from circulation and advertising dropped 3 per cent and 8 per cent respectively in the period.

Group underlying revenues were up 5 per cent driven by a strong performance at its business to business arm, although the company said it remained cautious over the outlook for its newspaper business. The group said the decline in advertising revenues at its embattled Northcliffe Media arm had worsened so far in 2011, falling 12 per cent in the first two months of the second quarter.

This included a 27 per cent drop in recruitment revenues and a 12 per cent decline in income from notices in regional newspapers.

Local newspapers have suffered falling circulation and advertising revenues in recent years following competition from the internet, with fellow regional publishers Johnston Press, owners of the Yorkshire Post, and Trinity Mirror having both posted gloomy updates in recent weeks.

Analysts at Charles Stanley said there were still structural issues at the Northcliffe business and added there were continued rumours the arm could be sold.

Associated Newspapers, which runs DMGT’s national newspapers, saw underlying revenues from circulation drop 2 per cent even though both the Daily Mail and The Mail on Sunday increased their market share. Underlying advertising revenues grew 5 per cent at the division, but weakened to 2 per cent in 2011 as the business hit tougher comparatives from a year ago.

A 4 per cent rise in digital advertising helped offset more “subdued and volatile” print advertising, the group said.