By Rory Gallivan
LONDON--U.K. newspaper publisher Trinity Mirror PLC (TNI.LN) on
Monday reported a deterioration in print advertising sales in
recent weeks, as supermarkets such as the troubled market leader
Tesco PLC (TSCO.LN) held back on marketing spending.
Trinity, which publishes the national tabloid The Mirror and
local titles such as the Liverpool Echo, Monday reported total
revenue down 5% so far in the second half compared with last year,
worse than the 2% decline experienced in the first half.
But the company said it still expects full-year profit to be in
line with previous predictions, helped by cost-cutting
initiatives.
The weak trends recently have been "driven by weaker national
display advertising, in particular supermarket spending," said
Trinity, adding that advertising has been volatile from month to
month.
"The biggest year on year on change has been Tesco ... so
perhaps there is a link between poor performing supermarkets and
supermarkets not advertising with us," Chief Executive Simon Fox
said during a call with analysts.
Tesco earlier this year said it had discovered issues in its
accounting and is now being investigated by U.K. fraud
authorities.
"We still think press is by far the quickest and most effective
way to get price messages out there and therefore we clearly remain
optimistic that they will return to the fold," Mr. Fox said.
He added that the company is well placed to continue growing
online advertising revenue strongly, helped by initiatives such as
introducing advertising into smartphone apps next year. As with
other publishers, online advertising currently accounts for a small
proportion of online advertising at Trinity Mirror, but is growing
fast.
Shares at 1057 GMT, down 5 pence, or 3%, at 161 pence valuing
the company at GBP414.9 million ($658.7 million).
-Write to Rory Gallivan at rory.gallivan@wsj.com; Twitter:
@RoryGallivan
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