According to the latest report from Statistics Canada, advertising revenue for domestic newspapers rose to $3.98 billion in 2006, a 2.7% increase from the previous year.

Daily newspapers generated $2.85 billion in advertising revenues, while community newspapers made $1.13 billion.

Broken down geographically, Ontario experienced a 5.1% rise in operating expenses, depleting profit margins for 2006 to 10%, compared with 7.4% in 2005. In Western Canada, operating revenues rose 3.9%, which was nearly double the 2.1% increase in Ontario. In Atlantic Canada, profit margins were 12.3% and, in Quebec, 13.5%.

While growth among Canada’s newspapers was short of gangbusters, it compared positively with the sector’s American counterpart, where ad revenue reportedly fell 7.9% to $45.38 billion.