Trinity Mirror, the UK's largest newspaper publisher, is today
issuing a trading update in respect of the 26 week period to 1st July 2001,
ahead of a series of analysts briefings prior to the Group's interim
announcement on 27th July.
The 26 week period has been characterised by a relatively strong
advertising performance in the first 13 weeks which has been offset by a
difficult and volatile advertising market for the remainder of the period. In
the AGM trading statement issued on 9th May, the company indicated that growth
across all businesses and categories was slower. This trend accelerated over the
last two months of the period.
Advertising revenue growth across the regional newspapers for
the 26 week period is estimated to be 4.5%*. The strong first quarter was offset
by a weaker second quarter, with an estimated 2% increase in the period April to
June. This growth is principally driven by recruitment advertising, which is
estimated to have grown by 17% in the 26 week period, with the first three
months of the year seeing growth in excess of 20%, which has since eased off to
13% in June.
Advertising revenue for the UK national titles has grown by
nearly 2% in the 26 week period, however, an estimated decline of 4% has been
seen in the period April to June (with June declining by 10%). The Scottish
nationals business has suffered from very difficult trading conditions, with an
estimated decline in advertising revenue of 3.5% for the 26 weeks, which
includes a decline of 6.5% during the period April to June.
Current trading conditions remain volatile with very limited
visibility and no signs of a return to the level of advertising revenue growth
that was seen in the earlier part of the year. Cost reduction measures are being
applied throughout the Group to mitigate partially the effect a continuation of
the current trend would have on the level of profitability for the year.
As reported in the preliminary results in March, the Board is
also committed to initiating a number of long-term profit enhancing plans across
the Group to develop further the significant strength of the core businesses.
These plans will include continued investment to achieve the Group's strategic
objectives. Further details of the profit enhancement plans, current trading and
prospects will be provided in the interim announcement to be issued on 27th
July.
*advertising revenue growth rates for the regional newspapers
are stated on a pro forma basis i.e. excluding revenue from Belfast Telegraph
Newspapers in 2000 (sold July 2000) and including Southnews revenues in 2000 and
2001 (acquired November 2000). These growth rates also exclude advertising
revenue from the Metro titles, which is estimated to have increased from £0.4
million in the first 26 weeks of 2000 to £4.0 million in the current
period.
