Newsquest's ad revenues fall nearly 8%

Regional newspaper group Newsquest, which owns titles including the Glasgow-based Herald and the Argus in Brighton, has reported that ad revenues declined 7.9% year on year in the fourth quarter of 2010. Newsquest, owned by US newspaper giant Gannett, said national advertising revenues fell by 1.6% year on year, retail sector ad revenues dropped by 5.9% and classified advertising declined 10.2%. The company publishes 189 titles in the UK, including 19 dailies. Within classified advertising automotive fell by 5.7%, employment ads dived 21.3% and housing advertising fell 3.6% year on year. The overall fall of 7.9% in the fourth quarter is only a slight improvement over the 7.1% ad revenue decline Newsquest recorded in Gannett's third-quarter trading update . Newsquest is significantly underperforming Gannett's US publishing division, which includes USA Today, which reported only a 4.8% year-on-year fall in advertising in the fourth quarter. Earlier this month an internal memo circulated to Newsquest staff in Wales, Gloucestershire, and the south Midlands asked staff to take a week's unpaid leave in response to "poor trading conditions". In October Gracia Martore, the finance chief at Gannett, said that it was a "myth" that Newsquest did not make money . Martore, responding to an analyst questioning whether Gannett might sell off the underperforming Newsquest, said that the business "makes a lot of money". "Their margins [Newsquest's] are in the high teens to low 20s," she said. "And they have consistently made money throughout the years, even in a year like last year when revenues were under as much pressure as they were." • To contact the MediaGuardian news desk email [email protected] or phone 020 3353 3857. For all other inquiries please call the main Guardian switchboard on 020 3353 2000. • If you are writing a comment for publication, please mark clearly "for publication".