Profits slump at Trinity Mirror

So, with first-quarter advertising down 12 per cent, and circulation revenues already feeling the impact of the newly launched Sun on Sunday, the media group is launching a daily deals business, Happli, in a bid to turn its fortunes. Some £10m will be invested into Happli, which is aiming to attract consumers with high value local and national voucher offers. The division is aiming to become profitable in 2014.

Shareholders will sincerely hope it does, as a £22m hike in newsprint costs and 7 per cent decline in advertising revenues largely offset £25m of cost savings and meant that the national newspaper business registered a 12 per cent decline in operating profits to £83.1m. The regional business fared even worse, suffering a 15.9 per cent fall in profits to £36.5m. However, there could be some respite in store as newsprint costs are expected to fall this year, a further £15m in cost savings should be realised and there are some promising business-to-business initiatives like digital marketing.

Analysts at Singer Capital Markets are expecting a modest decline in 2012 adjusted pre-tax profits to £89m, giving EPS of 25.9p (£91.9m and 27p in 2011).