Britain’s largest newspaper publisher, Trinity Mirror, has warned investors of a downward trend in media advertising next year, compacting a poor end to 2005, which saw the firm’s ad sales fall by 7.9% in the five months to November.
In a pre-close trading statement to the City, Trinity said its group advertising revenues had fallen by 3.9% year on year in the 11 months to November, with the economic slowdown and the shift towards online recruitment advertising resulting in an advertising slump for traditional media.
In its statement this morning, Trinity said: “The downward trend in the advertising market continues and there will be inflationary and other cost pressures in 2006, including higher newsprint prices,” however, the publisher also claimed that 2005 would be “in line” with expectations.
Advertising revenues for the company’s regional newspaper division fell by 4.9% in the five months to November, while the company’s recruitment advertising saw particularly weak results, with revenues slipping by 20.5% year on year.
Advertising revenues in Trinity’s national press division fell by 14.4% for the five months to November, while ad revenues for its Sports division and the Magazines and Exhibitions divisions fell by 11.2% and 9.1%. Elsewhere, Trinity’s group circulation revenues increased by 1.4% during the same period, and by 2.4% for the 11 months to November.
Trinity outlined plans for cost savings of £15 million next year, although analysts were this morning described as “sceptical” over the company’s ability to deliver, expecting to cut profit forecasts following the downbeat trading update.
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