Though humbled, the FT looks to be recovering.

“After a few bad years, last year the paper had a very good year in terms of ad revenue. They have been doing well – demand is strong,” says David Barnett, press account director for the UK at Universal McCann. “Circulation is pretty stable now too.”

As much as anything, it reflects a change of leadership at the FT, though certainly a good part is also the revived UK economy. The paper has a new editor who's hard at work to combat a significant rise in competition in the UK.

But it has not come without some pain. In November 2005, after four years as editor, much of it during the difficult dot.com bust years, Andrew Gowers was abruptly sacked, reportedly after a squabble over the paper's direction with Marjorie Scardino, CEO of the FT’s owner, London media conglomerate Pearson PLC.

In came Lionel Barber, a long-time FT editor and well-respected journalist. Barber faced something of a mess. The paper's worldwide circulation had slumped to 425,000 from 501,000 in 2001, its UK circulation down to 120,000 from 175,000.

Advertising revenues were actually on the rise, having improved marginally in 2004 and 2005, but they were still far below their 2000 peak following the double-digit losses over the earlier three years.

Things look slightly cheerier these days.

Overall circulation had crept up, rising to 433,000 as of last November, and so has its British circulation, at 136,000. Those are hardly stupendous gains, and Barnett doubts the UK edition will ever see anything like its earlier circulation numbers. Yet the losses have been stemmed, which is the important thing. Says Barnett: “They seem to have a core following now.”

Advertising revenue is expected to be up 9 percent in 2006, according to estimates from Derek Terrington, media analyst at Blue Oak Capital, an independent stock brokerage. But Terrington doesn't read too much into those gains. This still leaves ad revenue about $195,000 below the 2000 peak, and as he notes, “It is only fairly recently that they have managed to get the advertising moving again.”

The question remains: How much of the FT's improved circumstances reflect its own doing and how much reflect the improved economy? It's hard to say.

During the slump, the paper was always quick to note its circulation declines mostly reflected the hard times being felt in London's financial markets. With so many workers laid off, there were that many fewer people feeling a need to buy the paper on their way to work.

These days, with the city booming, people are back to their old jobs, and more papers are beings sold.

But some credit goes to the FT. It has ramped up its spending on advertising over the past year, media people note, and that's helped build awareness among readers and advertisers.

Too, Barber, in addition to reshuffling editorial positions, is putting more emphasis on the paper’s domestic coverage. Critics say the paper seriously blundered during its expansion phase by neglecting its UK coverage, which invited competitors to move in and steal away advertisers and readers.

Even so, any further gains by the FT will all be hard-fought, and Terrington believes it will have a struggle on its hands to achieve past revenue levels. The market has changed too much, with so much more competition. There's the internet, of course, but also the increased business coverage by Britain's national general-interest newspapers and even a free business daily serving the city of London.

These have taken their toll, and they will continue to do so. Says Terrington: “It is boom time for the financial markets, but not boom time for the FT."