In a trading statement for the nine weeks to June 29 Trinity Mirror said that the weak state of the display ad market reflected the uncertain outlook for the economy as inflationary cost pressures and the wider implications of the credit crunch take their toll.
Trinity Mirror said that it expects underlying group revenues to be down by 4.5% and that underlying advertising revenues were down 12.6%.
Trinity Mirror said that the "marked" decline in advertising revenues was across its business during May and June it expected this to continue for the remainder of the year.
Trinity Mirror said: "Month on month volatility remains and this could worsen as we trade through a very uncertain economic outlook.
"In the challenging advertising environment management continues to manage the cost base tightly and will continue to seek opportunities for further efficiencies in operations."
As a result of falling profits the newspaper publisher said it was cancelling £67m of the £175m share buy back programme.
Advertising revenues for its regional and nationals newspaper divisions are expected to fall by 6% and 6.5% respectively.
Recruitment advertising at its regional newspaper business, which includes the Birmingham Post and Liverpool Echo, has been hardest hit. Recruitment ads are down 8.4%, property down 17.1%, motors down 17.5% and other classified categories down 2.2%.
On a more positive note digital revenues for the period are expected to grow by 40.1% with an increase of 34.4% for its regional newspapers and 98.7% for the nationals. Group digital revenues are expected to grow by 24.4% with regionals division growing by 18.3%.
"We will continue to invest in digital and the ongoing capital investment to implement our new operating model across the group."
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