The Daily Telegraph and The Sunday Telegraph ran up a loss of £9.8 million last year, after the newspaper group paid £25 million in interest on borrowings and £20 million on redundancies and internet investment, according to accounts from the newspapers' holding company filed with Companies House.

However, the deficit was an improvement on the £30.7 million deficit of 2005, when the loss-making newspapers had to be supported by a £25 million cash injection from Sir David and Sir Frederick Barclay, the reclusive twins who own the national titles.

During the year, the titles moved from Canary Wharf to Victoria, Central London, in a restructuring that entailed 132 redundancies and the creation of a multimedia digital newsroom.

That cost £19.6 million, compared with a £13.6 million redundancy charge taken in 2005, when 90 employees were laid off.

Further job losses at the newspapers could be announced tomorrow, when journalists in the business sections meet to discuss the introduction of a seven-day operation.

A rationalisation of journalists is expected to be part of the exercise.

The Barclays borrowed £272 million to buy the titles in 2004 as part of a £667 million deal.

Gross debt eased £11.5 million to £252.5 million in the year.

With cash balances factored in, net borrowings were trimmed by slightly less than £4 million to £221.9 million.

That debt, whose cost is linked to the rates at which banks lend to one another, cost £25.4 million in 2006, similar to the £26 million in 2005.

Group turnover was £449.7 million, up 2 per cent, including printing joint ventures with Richard Desmond in the Docklands and the Guardian Media Group in Manchester.

Profit at the Telegraph titles in isolation, according to a separate set of accounts, with interest and restructuring charges stripped out, showed that income was £32.7 million, down 3 per cent, with profit margins down from 10.4 per cent to 9.6 per cent.

That income is used to pay the interest on the bank loan.

According to the accounts, the strategy for Telegraph Media Group is to make "news and comment under the Telegraph brand available to readers, listeners and viewers in the format most convenient to them".

Those plans are "underpinned by the values of honesty, integrity and accuracy that are inherent in the Telegraph brand".

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