News International to print The Sun in-house cancelling Johnston Press contract in £10m deal

News International has agreed to pay Johnston Press £10m to prematurely terminate the last printing contract between the two publishers.

The final Sun newspaper printed at Johnston’s Dinnington plant, near Sheffield, was Monday's edition printed on Easter Sunday.

The contract to print the paper was signed in 2005 and was due to run until 2022 but declining circulation has led News International to rethink its print strategy.

The company is now printing The Sun in its Knowsley plant, which runs the same triple width Manroland presses as in Dinnington. It has a total of 19 presses in Knowsley, Broxbourne and Glasgow.

The move follows an earlier £30m agreement in July 2012, when News International withdrew early from contracts at Dinnington and Johnston’s Portsmouth facility.

In a statement, Johnston Press said: "There is no planned headcount reduction as a result of this agreement and Johnston will explore new contract printing opportunities with immediate effect."

The money will go towards paying Johnston’s debts. The company declined to comment further.

David Dinsmore, director of operations at News International said his company made the move now because it had both state-of-the-art presses and the capacity needed.

"Print numbers are declining across the industry, it’s making the best use of our facilities," he said.

"There’s nothing wrong with what Johnston Press can provide and we had a great relationship with them over the years. It’s just a question of printing on our own presses."

Other titles printed at the Knowsley facility include The Sunday Times, The Telegraph, The Financial Times North and a number of local papers.

News International also prints Johnston Press’s Lancashire Evening Post and its Challenger Series there.

Dinsmore said News International was now the biggest contract printer in the UK, printing 411,000 tonnes of paper a year at its three UK plants.

"We are keeping our presses full. It’s a real vote of confidence in our presses as well, they are printing just as many newspapers today as they were five or six years ago and there aren’t many printers that can say that," he added.

News International still has print contracts with Independent News and Media in County Down, Northern Ireland, Smurfit Kappa News Press in Kells, Ireland and Prinovis, Liverpool, for magazines.

Average daily circulation for The Sun dropped from 2.6m in February 2012 to 2.3m in February 2013, according to the latest Audit Bureau of Circulation figures.

For the same time periods The Times dropped from 397,549 to 393,814 and The Sunday Times from 939,395 to 875,434. There are 264,85 digital subscribers to both papers combined.

The Sun on Sunday sold 3.2m copies on its launch day, 26 February 2011, and 1.9m on an average Sunday in February this year.

In comparison the average Sunday circulation during the The News of the World’s final three months was 2.7m.