The pain being experienced by print and media businesses is writ large by those that are still plcs, and have to go public with the numbers at the earliest opportunity. As such, news that Johnston Press is axing its final divided comes as no surprise. The group is tussling with the best part of £500m of debt, while ad revenues have fallen off a cliff, down 17% last year and 36% year-to-date. To read the headline "Johnston Press raises going concern doubt" in the FT this morning is wince-making indeed.
Turning to another plc fixation, I see that St Ives shares hit a new low of 45.25p this morning. The 52-week high is 249.25p. The group is in a close period at the moment ahead of announcing its interim results at the end of the month, but if the shares remain at this sort of level I shall be keeping an eye out to see whether the directors pile in once they're able to.
The other interesting thing will be what happens to the St Ives dividend. Since 2001 they've managed to maintain the total for the year at 17.15p. At today's new low that represents a yield of 37.28%. I'll just repeat that: 37.28%.
Of course I am all too well aware, given my hilariously inept amateur investor track record in bombed out print stocks, that the value of investments can go down (and down and down and down) as well as up. And dividends are not guaranteed.
Last year the St Ives divi wasn't covered by the group's net profits because of a £5.4m tax hit caused by the abolition of the Industrial Buildings Allowance. So barring some sort of Tommy Cooper-esque sleight of hand it's difficult to see how they will be able to maintain it for 2008/2009, especially given the gloomy trading statement from a few weeks back. I'll be surprised if they axe it altogether though, perhaps the more likely outcome would be to halve it. That's still not a bad return at this price, which could explain why someone piled in and bought not far off 25,000 shares a week or so ago. At this rate maybe I should be keeping my eyes peeled for any "notifiable interest" announcements, too.
