Johnston pension deficit ‘reduced by £50m’

Shares of Johnston Press, owner of regional newspapers including The Scotsman and Yorkshire Post, rose 13% after it said it expects the deficit in the company’s pension plan to be reduced by £50 million.

The pension scheme’s deficit was £90 million on January 3, 2015.

In a regulatory news service statement, the company announced the results of its pension study “for the purpose of assessing the liabilities” of the Johnston Press Pension Plan.

“Full details of the study and assumptions used in calculating the changes to the scheme deficit will be presented in the preliminary announcement of results for the 52 weeks to 2 January 2016 expected to be announced on 22 March 2016,” said Johnston Press.

The company said the findings of the study are expected to reduce the present value of the scheme’s deficit “by some £50 million at 2 January 2016 under IAS 19.”

Further, following a change to the pension plan’s rules agreed by the scheme trustees, Johnston Press “will now be entitled to participate in any surplus when the scheme closes.”

“As a result, the application of IFRIC 14, which resulted in an additional liability of £3 million at 3 January 2015, will not be required,” said the company.

Johnston Press said the adjustments, taken together, will reduce the scheme deficit by £53 million.