Earnings: NYTCo Swung To Loss In '08; Q4 Profit Drops 47 Percent
This story was written by David Kaplan.
As pressure on the newspaper industry reached a crescendo this past year and its own debts and financial struggles began to mount, The New York Times (NYSE: NYT) Co swung to a loss for the full year in 2008, reporting a loss of $57.8 million versus net income of $208 million the year before. As for Q4 earnings, net income was $27.6 million, a 47 percent drop from Q407's $52.9 million. Revenue fell 10.8 percent to $772.1 million. The news follows a dismal December report, when revs slid 9 percent. As a result, advertising revenues fell 17.6 percent during Q4.
Writedowns: Looking at continuing operations, the newspaper company had EPS of of $0.19, including $.10 per share for severance costs and a non-cash charge totaling $0.7 per share for the write-down of assets, compared with $.37 EPS last year. NYTCo also record a non-cash charge of $19.2 million ($10.7 million after tax, or $0.7 per share) for the write-down of an intangible asset at The International Herald Tribune, which is part of The New York Times Media Group.
Online: In a statement, NYTCo President/CEO Janet Robinson cited the deteriorating economic conditions as exacting particular pain on the newspaper industry and causing advertisers to scale back significantly, even on the internet which had remained a bright spot for first nine months of the year. After growing almost 15 percent during that time, digital advertising decreased 3.5 percent to $81.9 million in Q4, as online marketers cut back on display ads. Overall, NYTCo's internet businesses, which include NYTimes.com, About.com, Boston.com and other company sites, saw Q4 revenues decrease 2.9 percent to $92.5 million from Q407's $95.2 million.
Full-year web results: The NYTCo's '08 internet revenues fell 6.5 percent to $351.7 million from $330.2 million in 2007. On the plus side, it was able to hold on to most of its gains in online ads, as '08 website ad dollars grew 9.3 percent to $308.8 million from $282.5 million.
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News Media Group: The segment's revenues fell 11.1 percent to $742.2 million from last year's $835 million. Ad rev dropped 18.4 percent. Circ dollars were up 3.7 percent, due mostly to higher prices at each of the company's media groups, though that was held down by volume declines.
About Group: The once robust About Group saw its revenues slip 2.9 percent to $29.8 million from $30.7 million, again, a victim of a pullback in display ad spending. Total About Group operating costs increased 3.6 percent to $19.8 million from $19.1 million. Operating profit declined 13.8 percent to $10.0 million from $11.6 million.
By David Kaplan