Downturn hits newspaper profits

The Daily Mail group is trying to reduce costs by nearly �100m

The publisher of the Daily Mail has reported a 9% fall in full-year profit due to the current economic downturn.

Meanwhile, its competitors have announced a pay freeze and job cuts in a sign of pressure on the media sector.

Daily Mail & General Trust said its pre-tax profit had declined to �262m ($393m), with revenue up 3% to �2.31bn.

"The short-term outlook remains difficult and we are taking decisive action to defend profitability," the company said.

It added it had started taking steps to reduce costs by nearly �100m.

UK newspapers account for about 60% of Daily Mail group sales.

Daily Mail chief executive Martin Morgan said that "the worsening economic conditions had an adverse impact on the newspaper and property businesses," but its business-to-business divisions "continued to perform well".

Media sector under pressure

Two other newspaper groups have also announced measures to save money.

Independent News and Media, which publishes the Independent newspaper, said this week it would cut 90 posts, mostly in the editorial department.

The company said a "sizeable number" of these cuts would be voluntary.

Meanwhile, the Trinity Mirror Group has announced a pay freeze for the whole group in 2009.

Its chief executive, Sly Bailey, said that revenues had been "considerably reduced", adding that she was trying to prevent further job cuts.

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