Johnston Press revenues slumped 9 per cent over the first half of the year and the publisher warned of “extremely challenging” trading exacerbated by the introduction of new data protection rules and uncertainty around the cost of paper.
The company’s shares plunged 13 per cent on Tuesday morning to their lowest-ever level after the trading update for 1 January to 31 May.
Johnston Press, which publishes more than 200 titles including The Scotsman and the Yorkshire Post, hailed strong performance at the i newspaper and said it expects full-year results to be in line with expectations.
However, it warned that the impact on digital advertising revenues of the General Data Protection Regulations (GDPR) in Europe was uncertain.
GDPR, which came into force last month, imposes stricter requirements on how companies collect and process personal information. It threatens to hurt online advertising revenues which rely on personal data to send targeted ads to consumers.
“We expect to see continued pressure on revenues in the second half of the year, and a requirement for cost savings”, Johnston Press said.
Johnston Press faces further questions around the restructuring and refinancing of £220m of bonds due for repayment on 1 June next year.
The company said it has yet to reach agreement with bondholders over these arrangements which include the option of restructuring its pension scheme.
Johnston Press has also reviewed its property portfolio as part of its bid to counter the mounting pressure on sales.
Ashley Highfield, the company’s chief executive, left last month after seven years in the job, citing family reasons.
Falling circulation as readers move online have has led to greatly reduced print advertising revenues, hurting all UK newspaper publishers and forcing many to slash costs. Shares in Daily MIrror owner Reach fell nearly 4 per cent in Tuesday.