Denis O'Brien, the largest single shareholder in Independent News and Media, has called for the immediate removal of Gavin O'Reilly as chief executive of the media group after the publication of a trading statement which the telecoms tycoon said amounted to a profit warning.

In the statement released this morning, INM said advertising revenue fell this year as "erratic" trading conditions were affected by the ongoing economic uncertainty.

In response Mr O'Brien said "the future of INM is more uncertain than at any time in its history" and it was time to remove the chief executive and overhaul the board.

"It is obvious the senior management team do not have the experience or vision to put in place a strategy that will ensure the company's survival. For the sake of all shareholders, it is time for change," said Mr O'Brien.

In an interim statement outlining its performance for the year to date, the group said underlying revenue was 5.6 per cent lower than last year, with advertising revenue down 6.4 per cent. Total circulation revenues declined by 1.6 per cent.

In the first half of the year, advertising was 7.3 per cent behind 2010 figures, while circulation revenue was 2.1 per cent lower in the same period.

"While the euro zone debt crisis continues to weigh particularly on the island of Ireland operations, the global contagion has also impacted on consumer confidence in South Africa, where advertising growth has been somewhat less pronounced than anticipated," the group said.

INM said cost controls have "substantially mitigated" the impact of lower revenues. Operating costs have fallen 3.2 per cent over the year, with those incurred at the island of Ireland division down 5.9 per cent on a constant currency basis. This was despite a rise of 31 per cent in the price of newsprint.

Net debt was cut by €40 million since the end of 2010.

"Against that backdrop, all of INM's market-leading publications remain profitable and cash generative and group net debt reduction for the year remains firmly on target," the statement said.

Looking ahead, the group said full-year operating profit would be in the range of €74 million to €78 million, with market conditions remaining challenging in Ireland and South Africa.

The group also said that an anticipated season lift in advertising in the second half of the year had not "fully materialised" as the economic crisis continued in Europe.