TIDMJPR
RNS Number : 3264V
Johnston Press PLC
02 November 2017
2 November 2017
Johnston Press plc (the "Group" or "Johnston Press")
Update on Trading and Strategic Review of Financing Options
Trading update for the Third Quarter 2017
The Group continues to make good progress with its strategic
initiatives, and the Board of Johnston Press (the "Board") remains
confident that trading for the full year will be in line with its
expectations.
Total Group revenue, excluding classifieds, was flat in the
third quarter, and including classifieds was down 7%, a 1
percentage point improvement on the second quarter.
Digital revenue saw continued growth, up 16% in the quarter
(excluding classifieds), a 3 percentage point improvement on the
second quarter. Print advertising (excluding classified) was down
8%, with print classified advertising remaining very challenging.
Circulation revenues were down 4% in the quarter. Contract print
revenues were up 8%.
The i newspaper continues to perform very well, with total
like-for-like revenues increasing 17% in the quarter (with print
advertising up 14% year on year), while the newly re-launched i
weekend has seen its average circulation volume increase by 15,000
in its first 3 weeks.
Other successful Saturday relaunches during the period include
the Lancashire Post and the (Ulster) News Letter, both of which
delivered a 3% increase on their base sale.
We achieved record web traffic during Q3, led by the Yorkshire
Evening Post growing 64% year on year. We have also seen
significant growth in digital native advertising in Q3 with growth
of 190% over Q2.
We have completed our strategic sales change programme, moving
some 60% of our advertising accounts into tele-sales, serviced from
our Sheffield-based Media Sales Centre, which will now be moving to
new offices to accommodate this growth part of our business.
Digital display advertising growth of 16% has been driven
through the use of user data to target customers and grow
advertising yields. More than 25% of local campaigns in Q3 had
data-led targeting, resulting in an increase in yield of up to 22%.
That user data is being bolstered by new initiatives launched
during Q3 to register users on our sites and build first-party
data, to increase page yields.
Highlighting our shift to digital sales locally, The Scotsman in
Q3 generated a 35% increase in total local advertising year on
year, driven by 47% of local display revenue now coming from
digital products.
Strategic review of financing options
On 29 March 2017, the Board announced that it had commenced a
strategic review to assess the financing options available to the
Group in relation to its GBP220 million 8.625% senior secured notes
which become due for repayment on 1 June 2019.
During a period of initial consultations in April and May 2017,
certain of the Group's largest shareholders and bondholders
expressed views regarding refinancing options and their broad
parameters. Following these initial consultations, the Board
engaged in preliminary discussions with the Trustees of the
Johnston Press Pension Plan (the "Pension Trustees") in relation to
potential amendments to the pension scheme. Discussions on a
framework presented to the Pension Trustees progressed
constructively over the summer and on 19 September 2017 resulted in
a draft set of proposed amendments to the pension scheme which
could be effected in the event of a wider capital
reorganisation.
On 10 October 2017, the Board announced that it was approaching
its largest bondholders regarding the formation of an ad hoc
Committee of bondholders (the "Bondholder Committee") to consider
in greater detail certain potential amendments to the Group's
capital structure, and that committee has now been formed. The main
objectives of these proposed amendments to the capital structure,
combined with the proposed amendments to the pension scheme, are to
(i) achieve a sustainable level of debt within the Group to enable
it to refinance its debt in the future, and (ii) materially reduce
or eliminate the pension scheme deficit by 2021, whilst preserving
the pension scheme members' benefits.
All of these proposals remain subject to negotiation and the
consent of relevant stakeholders, and there can be no certainty
that a formal proposal will be forthcoming.
The Board anticipates discussions with the Bondholder Committee
to progress over the coming weeks with the aim of further updating
the market in due course.
Ashley Highfield, CEO of Johnston Press, said,
"Our key strategic priorities of continuing the success of the i
newspaper and growing digital revenues have both shown strong gains
during the period. It is significant that The Scotsman saw strong
year on year advertising growth in Q3, with almost half of that
coming from digital, driven by both audience growth and increased
monetisation from data-driven targeted advertising.
A significant amount of work is being done on the strategic
review of financing options and we are pleased with progress to
date."
For more information, contact:
Johnston Press plc
Ashley Highfield, CEO
David King, CFO 020 7612 2600
Powerscourt 020 7250 1446
Rory Godson / Juliet Callaghan jp@powerscourt-group.com
/ John Elliott
Notes
About Johnston Press
Johnston Press is a leading multimedia business with a vibrant
mix of news brands that reach national, regional and local
audiences. We provide news and information services to local and
regional communities through our extensive portfolio of hundreds of
publications and websites.
Sharing information and opinion remains at the heart of what we
do and our titles, which include iconic publications such as the i
newspaper, The Scotsman, The Yorkshire Post and News Letter in
Northern Ireland are read via traditional print, online platforms
and mobile devices by 37.8 million people every month.
We are experts in combining national reach with local targeting
and are better equipped than ever to help advertisers tell their
stories, too, through our trusted platforms.
Forward-looking statements
The report contains forward looking statements. Although the
Group believes that the expectation reflected in these forward-
looking statements are reasonable, it can give no assurance that
the expectations will prove to have been correct. Due to the
inherent uncertainties, including both economic and business risk
factors underlying such forward looking information, actual results
may differ materially from those expressed or implied by these
forward looking statements. The Group undertakes no obligation to
update any forward-looking statements, whether as a result of new
information, future events, or otherwise.
Market abuse regulation
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014.
Johnston Press Legal Entity Identifier: 213800JFIBCR4LGUA242
Classification: Inside Information.
-ends-
This information is provided by RNS
The company news service from the London Stock Exchange
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