(Adds analyst’s comment, details on results, background)
By Arathy S Nair
April 17 (Reuters) - Johnston Press Plc, which publishes The Scotsman and The Yorkshire Post, said it was seeing “early signs of improvement” in print advertising as concerns about fake news and social media privacy drive a return to newspapers.
The industry has struggled as advertisers moved to online platforms, forcing several publishers including Trinity Mirror and Daily Mail and General Trust to cut costs.
However, in a possible first sign of a reversal, Johnston Press said on Tuesday that advertisers were starting to increase spending in regional print.
“Across our regional portfolio of titles national print advertising tracked in line with (the) prior year in the first quarter of 2018, with advertisers starting to increase spend in regional print,” Johnston Press said in a statement.
Reuters reported last week that the European Union is set to demand tech giants like Facebook and Alphabet do more to stop the spread of fake news by the end of the year to avoid possible regulatory actions.
The measures include improving the scrutiny of advertisement placements, among others.
Newspapers and other traditional media could benefit as advertisers seek brand-safe environments, which are not guaranteed on social media platforms, Liberum said, adding this could have implications for Trinity Mirror and Daily Mail.
Social media platforms have come under mounting criticism after personal information of millions of users was gathered from Facebook by Cambridge Analytica, a political consultancy.
Johnston Press, which has over 200 titles, also cited “a somewhat stronger overall” advertising market and said its ability to precisely target audiences using big data were also driver for positive ad spending.
However, the newspaper company said it would require cost savings as the trading environment would continue to be challenging, with pressure on revenue.
Total adjusted revenue fell 4.5 percent to 201.2 million pounds ($289.06 million) in the year ended Dec. 30, with print advertising declining 7.2 percent.
Johnston Press said it had traded in line with its expectations in the first quarter of 2018, with higher adjusted core earnings. ($1 = 0.6960 pounds) (Reporting by Arathy S Nair in Bengaluru; editing by Jason Neely and Alexander Smith)