Earnings: Gannett Q3 Profits Drop 32 Percent; Revs Slide 8.9 Percent
This story was written by David Kaplan.
Gannett's profits and revenues were down again in Q3, with total operating revenues slipping 8.9 percent to $1.64 billion from last year's $1.80 billion. Net income meanwhile fell 32 percent to $158 million ($0.69 per share) from Q307's $234 million ($1.01 per share), reflecting the woes its newspaper peers have been experiencing lately as revenue from ads and circulation plummet and the company acts to rein in costs. Gannett (NYSE: GCI) recently said it would eliminate 1,000 staff positions, including 600 layoffs, for a 3 percent reduction in its workforce. Analysts estimates gathered by Thomson Reuters (NASDAQ: TRIN) expected the USA Today parent to post a gain of 75 cents per share and revenue of $1.61 billion, AP reported in its earnings preview.
-- Digital: While noting the trouble on the print side, Gannett's earning statement attempted to highlight some of the more positive news on the digital front. Like most newspaper companies who are still experiencing growth from their respective internet propertiesalbeit at a slower rate, these daysdigital revenue ballooned to $77.5 million in Q3 from $17.1 million. Again, impressive numbers, but certainly not enough to stanch the losses elsewhere. As for a review of some of Gannett's digital moves during the quarter, the company acquired all of its partners' ownership stakes in ShopLocal and took an additional 10 percent stake in CareerBuilder, increasing its ownership to 50.8 percent.
-- Publishing: Publishing segment operating revenues were $1.36 billion for the quarter, a 14.4 percent decline from Q307. Ad revenues were $977.1 million compared to last year's $1.19 billion in the third quarter of 2007. On a pro forma basis, advertising revenues were 17.6 percent lower. More to come
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By David Kaplan