After publishing faked photographs purporting to show British soldiers abusing Iraqi prisoners, the Daily Mirror is losing tens of thousands of readers. (Hat tip: NC.)

Tens of thousands of readers have deserted the Daily Mirror because its Iraqi torture pictures were exposed as a fake, the newspaper’s owner admitted yesterday.

Trinity Mirror warned investors to expect disappointing revenues from its flagship national title, and said it did not expect circulation to climb back over the 2 million mark.

The company said its internal market research had showed the Iraq pictures hoax was behind the accelerating circulation decline seen at its national daily. “While circulation revenues have increased, circulation volumes during May for the Daily Mirror have been disappointing,” the company said in a trading update covering the past six months.

The City was told that June had been a poor month, too, although audited circulation figures will not be available for another few weeks.

The Daily Mirror’s average daily circulation was 1,846,734 in May, down by 40,000 readers compared with the previous month, according to the Audit Bureau of Circulations. The figure was the lowest since World War II.