I am trying to find a good reason for Ian Russell, a non exec at Johnston Press (JPR, 12.25p), buying 800,000 shares at 12.25p, taking his holding to 815,000 shares.

All I can think of is that he sees the possibility/a chink/ a flicker of light at the end of the tunnel.

Johnston Press ‘currently operate 18 daily newspapers, 300 weekly newspapers and a huge range of related specialist, locally focussed, print publications. They operate 323 local websites to extend the content and reach of their print products (Company website).

As such Johnston Press is/has been hugely vulnerable to the economic dowturn. On November 12th in an Interim management Statement, Johnston revealed that in weeks 27-44 advertising in property was down 48%, employment 32%, motors 24%, and display 12%.

This is made worse by the huge leverage this group has, with net debt of GBP 465m at November 1st, thankfully down GBP 19m from June 30th (Company website, Interim Management Statement)

So why is Russell buying shares?

This is Ian Russells first significant purchase, but probably not a large % of his assets. Russell was appointed to the board in 2007, was formerly CEO and CFO of Scottish Power, as well as currently being an advisor to 3i (Company website).

Johnston Press shares have fallen from a high of above 350p in April 2007, and now represent option money to investors. It may be that Ian Russell believes they offer a risk worth taking.

The jury will remain out on Johnston until the half year results in August 2009 at the earliest.  But the shares certainly won’t be trading at 12 1/4p by then. They will either be worth nothing, or above a pound.

View on Johnston Press: Positive

Strength of Signal: Weak. Only one director buying, in limited size.

Addendum: Consumer confidence improves for the second month in a row (BBC article on GFK NOP study)