What are we to make of advertising market forecasts? Two of the largest regional newspaper chains, Johnston Press and Trinity Mirror have just reported a recent growth in ad revenues.
According to Johnston yesterday, UK revenues were up 0.2% in the past five months, compared to a 1.5pc fall in the first half of the year. Furthermore, the rate of decline in print advertising has slowed to 0.8% from 2.9% in the first half.
Today Trinity also reported increased advertising revenues of 2.1% for the five months to the end of November. This compared with a decline of 1.5% for the first half of the year.
In other words, both are telling a similar story of an advertising recovery. But both also warn against optimism. Johnston's ceo, Tim Bowdler, said: "If you listen to what people are saying about the economy, it is reasonable to sound a note of caution." Turmoil in the financial markets could well hit consumer confidence next year.
One sign that all is not well is the slowing Irish economy. The Celtic Tiger's roar has become much more muted of late. Johnston, now a major player in the Republic, noted that advertising has declined by 1.2% in the last five months after rising by 10% in the first six months.
Trinity's board, looking at the British perspective, also spoke of a "month-on-month volatility" that makes predicting revenues in 2008 very difficult indeed. Note that in the 11 months of 2007, ad revenue at Trinity's regional papers slipped by 0.3%. So even the patchy signs of recent recovery have not been overly beneficial.
Volatility makes investors edgy. So shares in both companies, despite the fact that both continue to make profits, have been unpopular buys. As I write, Johnston Press is trading at 255p and Trinity Mirror is down 1.3% on the day to 341.50p. It is a depressing picture, is it not?
