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Newspaper companies' results decline

April 20, 2007|From the Associated Press

CHICAGO — Media companies announced lackluster earnings during the first quarter as declining revenue, profit and circulation figures dealt the newspaper industry its latest financial blow.

Gannett Co., Tribune Co., New York Times Co. and Media General Inc. all reported lower earnings Thursday, as classified advertising dwindled and overall online revenue growth began to slow, analysts said.

At Chicago-based Tribune, which owns the L.A. Times, interactive revenue grew 17% to $60 million. That segment grew 30% in the first quarter of 2006.

Newspaper publishers have been struggling for years as readers turn to the Internet for their news and advertisers -- particularly classified advertisers -- follow them. That trend has continued. During the latest quarter, classified revenue fell 14% at Tribune and Media General and dropped nearly 12% at New York Times and 3% at Gannett.

Michael Simonton, an analyst at Fitch Ratings Inc., said an 8% drop in print ad revenue at Gannett's flagship USA Today was cause for concern. Gannett, the nation's No. 1 newspaper publisher, is an industry bellwether. Its earnings fell 11% to $210.6 million, or 90 cents a share. Revenue slipped 1% to $1.87 billion.

McLean, Va.-based Gannett owns 23 television stations and several radio stations along with its nearly 90 daily newspapers.

New York Times' profit fell 26% to $23.9 million, or 17 cents a share, from a year earlier. Revenue fell 2% to $786 million. The New York-based company owns its namesake newspaper, the Boston Globe and more than a dozen other daily newspapers.

Media General, which publishes the Tampa Tribune, Richmond Times-Dispatch and Winston-Salem Journal, posted a loss of $6.5 million, or 27 cents a share, compared with a profit of $6.7 million a year earlier.

Revenue rose 5.9% to $230.4 million. Excluding the effect of four NBC stations that Richmond, Va.-based Media General acquired last summer, total revenue fell 3.2%. The firm had a 20% drop in print real estate ads.

Tribune, the No. 2 newspaper publisher, reported a loss of $15.6 million, or 6 cents a share, after paying preferred dividends. That's after a profit of $100.7 million, or 33 cents, last year.

The company, which owns 11 daily newspapers, 23 TV stations and the Chicago Cubs baseball team, said quarterly results were hurt by a nonoperating loss of 20 cents a share, related to an adjustment in the value of the company's 8-year-old stock investment in Time Warner.

Quarterly revenue dropped 4.3% to $1.21 billion. Publishing revenue slipped 5.5% to $931 million, and broadcasting and entertainment revenue fell $1 million to $283 million.

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