Postmedia Network Inc., which recently purchased Canwest's newspaper division, said the dailies' revenue had increased by 1 percent to 259.2 million dollars in the third quarter of the fiscal year, the Winnipeg Free Press reported yesterday.

The company's good results are due to an overall 2 percent growth in advertising revenue. The gains were registered despite the continued losses of classified, retail and insert ads, The Toronto Star informed.

However, the newspaper ad increase offset a decline of 16 percent in digital media revenue, partly related "to a change in allocation between reporting segments," Editor and Publisher explained.

The newspaper chain, which has 11 dailies and 26 community newspapers in Canada, also reported a 2 percent circulation decline.