Shares in newspaper publisher Johnston Press (JPR) hit their lowest level on record as the company provides a downbeat update ahead of today’s AGM - reporting revenue down 9% in its first half.
The company's share price is down 13% to 7.38p, off its lows, despite reaffirming its full year guidance.
A key takeaway from the announcement is a negative impact on its digital advertising revenue from new European data privacy rules (GPDR). These restrict the way brands use consumer’s data to serve them up targeted ads.
Shares in Daily Mirror publisher Reach (RCH) (formerly Trinity Mirror) and Daily Mail & General Trust (DMGT) are also down in sympathy, by 2.6% to 78.9p and 0.3% to 685.5p respectively.
AJ Bell investment director Russ Mould comments: ‘Newspaper publisher Johnston Press becomes one of the first companies to warn of a hit from new Europe-wide GDPR privacy rules.
‘The company blames the new regulations for pressure on its digital advertising revenue in a downbeat trading update.
‘If Johnston's experience is matched elsewhere then this digital advertising issue could crop up for other publishing outfits, advertising agencies and ad technology firms.
‘Brands that use data to target and enhance their digital marketing now have to ensure they are complying with the new regulations. This may prompt a shift towards brands targeting customer segments without the use of personal data.
In some respects, this is the least of Johnston’s worries. The company, whose titles include the i newspaper and The Scotsman, also faces a looming debt deadline.
It needs to refinance £220m in bonds due on 1 June 2019 and although it says talks are continuing with creditors, no agreement has yet been reached. The company is also engaged in a strategic review following the departure of chief executive Ashley Highfield.
