Earnings: Lee Enterprises's Slump Deepens, As Profits Plummet 71.9 Percent
This story was written by David Kaplan.
Last quarter, Lee Enterprises (NYSE: LEE) was one of the few newspaper publishers to see declines in online ad revenues, alongside the now-standard plunge on the print side. Things were more dire in Q3 for the Davenport, Iowa, publisher. Lee Enterprises recorded a staggering 71.9 percent decline in net income, ending Q3 with $5 million profits ($0.11 per share) versus last year's $17.8 million ($0.39 per share). The publisher said revenue dropped 10.7 percent to $244.9 million. Even though it was beginning to feel the fallout from the downturn in real estate, last year Lee saw Q307 profits rise 83 percent. And while revenue was essentially flat in Q307, online ads were up nearly 60 percent. This time around, online ad revenue fell 15.7 percent, suggesting a worsening trend from Q2's 9.1 percent decline in that category. More after the jump.
Overall, Lee's online ad picture was mixed at best:
-- Online retail ad dollars were up 16 percent
-- Online employment ads were down 31.5 percent
-- Combined print and online ad revs fell 12.9 percent to $184.5 million
-- Combined print and online retail ad revs declined 5.0 percent
-- In September, Lee's St. Louis Post -Dispatch laid off 20 staffers in its second round of job cuts. While Lee doesn't detail any possible forthcoming staff reductions, it did say it expected to reduce operating expenses by 6- to 7 percent. Lee also said that workforce reductions cost it $2.8 million in Q3.
By David Kaplan