DMGT plans further cutbacks following ad revenue falls in January

by Tristan O'Carroll, mediaweek.co.uk 11-Feb-09, 10:25

LONDON - DMGT endured a grim start to 2009, with Associated Newspapers' ad revenue tumbling by more than one-fifth year on year in January, and Northcliffe Media's revenue down 40% last month.

Following an 8% year-on-year dip in ad revenue in Q4 2008, Associated Newspapers' total revenue in Q4 fell by 5% to £237m.

Total advertising revenue in Q4 fell by 8%. Within this figure, revenue from Associated's newspaper operations fell by 9%, with display down by 8% and classified down 17%. Its strongest performing title was London Lite, which grew its display revenue by 21%.

Overall, the largest display category, retail, grew by 2% in Q4 year on year, but all other categories were down. Associated's digital revenue was down 3%.

In a statement, DMGT said that Associated's "January trading started very slowly after the New Year, with the result that advertising revenue for the month was 23% down on last year. However, circulations showed an improvement on prior months. Visibility on future advertising performance is very limited."

Meanwhile, regional division Northcliffe Media suffered an 18% slide in revenue in Q4 to £86m. UK advertising revenue was 27% lower than the same period in 2007. DMGT said all major product categories "remained under pressure" with retail client spend down by 23%, recruitment down 37%, property down 52% and motors down by 20%.

DMGT added: "Northcliffe had two very slow weeks after the New Year, resulting in advertising revenue for January being 40% down on last year."

Northcliffe's UK digital revenue in Q4 2008 was 6% up year on year, boosted by unique visitor levels to Northcliffe's network of "thisis" websites in December 67% higher than the corresponding period in 2007.

DMGT said it would continue to cut costs with "further substantial [cost] reductions" planned beyond those previously announced.