UPDATE 2-Johnston sees profit meeting view, shares up

* Ad decline slows to 22 pct in first 18 weeks of H2

* Full-year cost savings seen at 50 million pounds

* Says no decision taken on capital raising

* Shares up 4.6 percent

(Adds comment by company, reaction, share price)

By Georgina Prodhan and Paul Sandle

LONDON, Nov 11 (Reuters) - Johnston Press (JPR.L), Britain's biggest publisher of regional newspapers, expects to meet market expectations for its full-year operating profit as an advertising decline slows, it said on Wednesday.

The company said total advertising revenue fell 22 percent in the first 18 weeks of the second half from 33 percent in the first half.

"Recruitment advertising had got consistently poorer since the start of the year, whereas property started to see more encouraging signs in the second quarter and has continued," Chief Finance Officer Stuart Paterson said in a call with reporters.

Johnston said more stabile advertising revenues, combined with cost savings, meant it was confident of delivering an operating profit in line with current market expectations for 2009 of about 62 million pounds ($104 million).

Britain's regional newspaper industry has been hit hard by a severe downturn in classified advertising, but signs have been emerging that declines may be bottoming out.

Gannett (GCI.N), the largest U.S. newspaper publisher, last month reported an improvement in classified advertising in the quarter, including at its British unit Newsquest, the UK's second-biggest regional newspaper publisher after Johnston.

Classified ad revenue at Newsquest, whose titles include the Glasgow Evening Standard and the Oxford Mail, fell 35 percent in the third quarter -- an improvement of 10 percentage points on its second-quarter year-on-year decline.

RECOVERY POTENTIAL

Shares in Johnston, which touched a more than 10-year low of 4.8 pence in March, were 4.6 percent higher at 28 pence by 0924 GMT. The DJ Stoxx European media sector index .SXMP was down 0.6 percent.