Shares in Johnston Press (LON: JPR) have fallen nine percent over the first half of 2018 due to “extremely challenging” trading.
The group’s share price tumbled 17 percent to a new low on Tuesday morning after the trading update for 1 January to 31 May was released.
Johnston Press, which owns titles including The Scotsman and the Yorkshire Post, warned of “continued pressure”, which has been exacerbated by the introduction of new data protection rules and uncertainty around the cost of paper.
The new General Data Protection Regulations impose tighter regulations on how companies are able to collect and process personal information. The new regulations are likely to dampen online advertising and targeted adverts.
Despite the trading update, the group remains confident that full-year results will remain in line with expectations.
“The trading environment remains extremely challenging, exacerbated in recent months by uncertainty around future paper costs and the impact of GDPR on digital advertising revenues,” said Johnston Press.
“We expect to see continued pressure on revenues in the second half of the year, and a requirement for cost savings.”
Johnston Press are carrying out the restructuring and refinancing of £220 million of bonds due for repayment next year. No agreements have been reached and the talks are ongoing. Options include the restructuring of the group’s pension scheme.
The UK newspaper industry has struggled as advertisers are moving online. Print publishers including the owner of the Mirror, Reach, and the Daily Mail and General Trust (LON: DMGT) have cut costs as a result. Shares in Reach (LON: RCH) fell four percent on Tuesday.