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Publisher Says It Won't Meet Forecasts

September 20, 2002|From Reuters

Knight Ridder Inc., the No. 2 U.S. newspaper publisher, said Thursday that it expected third-quarter earnings to fall well short of analysts' estimates as weak classified advertising has hurt revenue in Silicon Valley and other key markets.

Chairman and Chief Executive Tony Ridder said he expected earnings to nearly match the 81 cents a share earned a year ago. Analysts, on average, expected earnings of 87 cents per share, within a range of 85 cents to 91 cents, according to Thomson First Call.

Shares of the company, which were off 68 cents when the news was announced, dropped $4.53 to close at $57.91 on the New York Stock Exchange.

"Hiring is still soft, and advertising for available jobs remains thin," Ridder said. "This choppiness has persisted into September."

Among its newspapers hardest hit by the classified ad drought is the San Jose Mercury News in Silicon Valley, the epicenter of the dot-com implosion.

Its total ad revenue was down 1.2% during August, and general ad revenue was down 4.3%. Classified ad revenue was down 6.6% for the month.

Knight Ridder operates 32 daily newspapers in 28 U.S. markets, including the Philadelphia Inquirer and Miami Herald, with 8.5 million daily and 12.1 million Sunday readers. Its Internet operation includes RealCities.com, a national network of city and regional sites.

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