May 1, 2018 / 7:41 AM / 3 months ago

UPDATE 3-Johnston Press finance chief to take charge as CEO quits

* CEO Ashley Highfield resigns after 6-1/2 years

* CFO David King to replace Highfield

* King will take over at AGM on June 5

* Highfield to get deferred bonus post-restructuring

* Shares up more than 9 percent (Adds quote from Custos CEO)

By Justin George Varghese and Maiya Keidan

May 1 (Reuters) - The chief executive of Johnston Press Plc Ashley Highfield has resigned after nearly seven years at the helm and CFO David King will replace him, the publisher of The Scotsman and The Yorkshire Post newspapers said on Tuesday.

Britain’s newspaper industry has struggled in the past few years as advertisers shifted to online platforms, forcing several print publishers including Trinity Mirror and Daily Mail and General Trust to cut costs.

Johnston Press has itself signalled the need for more cost cuts through restructuring, property disposals and capex reductions, as it faces pressure on revenue.

Highfield, who previously worked at BBC, cited family reasons for his departure rather than business reasons.

Investor Custos Group, which owns around 20 percent of Johnston Press, welcomed the change and said it would take the opportunity to re-engage with the company.

Johnston Press has been reviewing its finances and said last month that it was in talks with bondholders to refinance 220 million pounds in bonds due on June 1, 2019. Without a deal, Johnston Press said it would have to explore alternative refinancing and restructuring options.

The company’s shares were more than 9 percent higher by 1430 GMT but had halved in value since October.

Liberum analysts said King would be regarded as a safe pair of hands who understands the company.

King, also a former BBC executive who joined the group in 2013 as CFO, takes the reins as the company looks to expand its online audience.

DEFERRED BONUS

Leading shareholder Custos Group, which had been trying to oust Chairman Camilla Rhodes and director Michael Butterworth, was critical of the outgoing chief executive.

“I will initiate contact with the company again to sort out the mess that Ashley put the company into,” Custos Chief Executive Christen Ager-Hanssen told Reuters.

Custos said in November it would push for the appointment of Scotland’s former nationalist first minister, Alex Salmond, as the publisher’s chairman

Johnston Press declined to respond to Ager-Hanssen’s latest comments, while Highfield did not immediately respond.

Under Highfield, the company, which has more than 200 titles, acquired “i”, the cut-price sister paper of The Independent, two years ago to tap into its circulation revenue and advertising base.

Johnston Press said Highfield previously decided to defer his 249,000 pound bonus, granted to him for achieving 2017 targets.

A company spokesman said Highfield would not receive any payments from June 5 when he stands down, adding he would receive the deferred bonus payment only after the company’s restructuring. ($1 = 0.7274 pounds) (Editing by Jason Neely, Jane Merriman and Keith Weir)

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