DMGT touts 'revitalised' regional press

by Paul McNally, Brand Republic 10-Oct-07, 16:05

LONDON - The Daily Mail & General Trust has described its regional newspaper division Northcliffe as a 'revitalised business' with a 'renewed sense of purpose', less than two years after the aborted attempt to dispose of it.

In a presentation to City analysts this afternoon, Michael Pelosi, Northcliffe managing director, is due to paint an optimistic picture of regional publishing and the company's prospects for growth.

DMGT called off its attempt to sell Northcliffe, which publishes titles including the Bristol Evening Post and Leicester Mercury, for £1.5bn in February 2006, saying the offers it had received for the unit of around 20 daily titles and 80-plus weeklies did not "fully reflect the long-term value of the business".

After electing to stick with Northcliffe it proceeded to focus on reducing costs and developing its digital business and is now trumpeting its transformation.

Pelosi said: "We have a revitalised business, which is clearly focused, more efficient, operating on a much reduced cost base, and has a renewed sense of purpose.

"Online, we are getting better by the day...But we still recognise the huge value of print and we will launch selectively where market opportunities present themselves.

"We must deliver local audiences if we are to achieve profitable revenue growth. Digital publishing has a key role to play here."

In a trading update last month ahead of its end-of-year results, DMGT said Northcliffe Media was experiencing "slowly improving" advertising revenues, with income from July to September up 2.4% on the previous quarter.

Recruitment and property advertising were the biggest growth areas for the regional newspaper publisher, while motoring and retail advertising had fallen sharply.

Circulation revenues for the 11 months from October 2006 to the end of August this year were down 1.2%. However, DMGT said it had achieved its cost-cutting target of £45m, reducing overall headcount at Northcliffe by 5%.

Online operations posted a 78% year-on-year revenue increase, buoyed by acquisitions such as JobsGroup.net in August, a network of niche job websites covering engineering and construction.

DMGT is expected to announce its end-of-year results to the City on November 21.