Daily Mail and General Trust managed to raise profits of its national newspapers despite the cost of launching a London freesheet and falling circulation at the Evening Standard.

The company’s Associated Newspapers arm was buoyed by rapid growth in digital revenues, which in total accounted for 47 per cent of the operating profit generated by the 84-year-old company behind the Daily Mail.

Peter Williams, finance director, said that the launch costs for London Lite were “in the order of £1 million to £2 million”, and added that the paid-for Evening Standard was unaffected financially after the launch of two London freesheets in September.

News Corporation, parent company of The Times, introduced thelondonpaper two months ago. To stave off the threat to the Evening Standard, DMGT introduced its own freesheet. Sales of the Standard fell 10 per cent to 281,915 between October and August, while London Lite was given out to 327,580 people.

“In October the Standard made a profit,” Mr Williams said, although that month is typically strong for the title. In the year to October 1 the Standard lost “less than the previous year”, when the company conceded that the title had run up a deficit of “less than £10 million”.

Mr Williams declined to predict when the Standard or London Lite would become profitable, although he said that the freesheet was using fewer distributors than its rival. However, in October thelondonpaper’s circulation was 377,525, narrowly ahead of London Lite.

Associated Newspapers’ operating profit totalled £97 million, against £95.9 million the year before, despite revenues that were 1 per cent weaker at £931 million. Websites, including those for jobs, dating and car sales, generated revenue of £55 million, double that of the year before, and operating profits of £13 million. Overall group pre-tax profits for the year to October 1 were £311.5 million, compared with £195.3 million a year earlier. Without exceptional items — principally gains from the sale of the Aberdeen Press and Journal — the profit improvement was 9 per cent to £260 million.

DMGT’s network of Australian radio stations had a disappointing year, running up losses of £4.5 million after the launch of the Vega stations, for listeners aged 40 to 54, misfired. Regional newspapers generated £86.8 million, 6 per cent less than last year, as a 24 per cent fall in advertising revenue offset cost-cutting gains. Electronic information operations grew fast, with operating profit up 53 per cent to £68 million.