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Earnings: McClatchy Loss Widens; Digital Ads Down 4.7 Percent

This story was written by David Kaplan.
After days after receiving another NYSE delisting notice, The McClatchy Company (NYSE: MNI) said its Q1 loss widened to $37.7 million ($0.45 per share) compared to last year's $993,000 loss. On an adjusted basis, the company's loss was $22.9 million ($0.28 per share). Looking at those adjusted numbers, the Sacramento publisher missed Reuters analysts' estimates, which were between $0.05 and $0.16.

Revenues fall 25.1 percent: Turning to revenues from continuing operations, that number was $365.6 million, down 25.1 percent. Ad revs fell 29.5 percent to $284.7 million. By comparison, circulation revenues were a bright spot, though they were relatively flat coming in $68.5 million for a slight gain of 0.9 percent.

Digital down 4.7 percent: While McClatchy seemed to boast that all categories of digital advertising are outperforming print advertising, it was still not anything to celebrate. In total, digital advertising revenues decreased 4.7 percent in Q1. The segment was brought down by negative employment advertising, the category most negatively affected by the economic recession and which is down substantially in print and online. Excluding employment advertising, digital advertising revenues grew 28.7 percent. Also, digital advertising represented 15.3 percent of total advertising revenues, up from 11.6 percent of total advertising for all of 2008, and average monthly unique visitors to our websites grew 26.7 percent during the quarter. More after the jump

Earnings release | Webcast (12:00 PM EDT) | Transcript (via Seeking Alpha)

Job ads, decimated: During the call, Ga Pruitt, McClatchy's CEO and president, outlined how bleak Q1's employment ads were. As a whole, the job ads segment was down 63 percent. Print help wanted revs were down 67.6 percent, while online fell 55.8 percent. Aside from the dismal employment situation, Pruitt pinned job ads poor performance to the close tie between print and online up sells, something that analysts like Borrell Associates have been warning about since the "good old days" of 2007.

By David Kaplan

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