Posted on 10/25/2007 11:59:10 AM PDT by abb
Belo 3Q Profits Down on Spinoff of Newspaper Group and Slumping Advertisements
DALLAS (AP) -- Belo Corp. said Thursday that its third-quarter profit fell 2 percent on lower advertising sales at its newspapers, which the media owner is spinning off into a separate company. Belo said it earned $18.8 million, or 18 cents per share, in the quarter ended Sept. 30, down from $19.2 million, or 19 cents per share, a year earlier.
Analysts polled by Thomson Financial had expected profit of 20 cents per share.
The summer results included $2.3 million, or about a penny per share, in transaction costs related to the recently announced spinoff of the company's four daily newspapers, including The Dallas Morning News.
Revenue fell 3 percent from a year ago, to $364.3 million. Analysts had expected $367.7 million.
Belo owns 20 television stations, and broadcast revenue rose 1.8 percent in the quarter despite the loss of some political advertising from last year, an election year. But the Dallas-based company said fourth-quarter TV sales would decline by mid-single-digit percentages without last fall's political advertising.
At the newspaper group, revenue fell 7.8 percent from a year ago. Sales declined for retail, general and classified advertising but rose for preprint and newspaper Web site ads. The online ads rose 25 percent, to $13.9 million.
Belo said fourth-quarter newspaper revenue would continue to decline at the same pace it has fallen so far this year -- 9 percent.
"I had sort of hoped the newspaper business might get a little better in the fourth quarter, but I guess it's not," said Edward Atorino, an analyst for The Benchmark Co.
Belo has cut jobs at the Dallas paper and The Press-Enterprise in Riverside, Calif., measures that which helped the newspaper group reduce costs by 6.9 percent this summer from a year ago. The company also trimmed interest expenses and taxes and said costs would continue to fall in the fourth quarter.
Atorino said management has improved the balance sheet.
Belo plans to spin off its newspapers early next year into a separate company, A.H. Belo Corp., with a ticker symbol of AHC. In a break for the papers, Belo's $1.2 billion in debt will stay with the broadcast company.
Shareholders had pushed Belo to split the company, believing that the stock price reflected the newspaper industry's struggles instead of the better recent results at the TV stations.
Belo's stock jumped 18 percent on Oct. 1, when the company announced the spinoff of the newspapers, although the stock has since given up about two-thirds of that gain.
Chairman and Chief Executive Robert Decherd, who plans to lead the newspaper company, said Belo was pleased with reaction to the spinoff.
Shares fell 23 cents, to $18.30 in midday trading.
Through the first nine months of the year, Belo reported profits of $70.6 million, or 69 cents per share, on revenue of $1.11 billion. In the same period last year, Belo earned $79.2 million, or 76 cents per share, on sales of $1.15 billion.
ping
And the hits just keep on comin’!
The Dallas Morning News is nothing more than a NY Times and Washington Compost outlet. They use to have real award winning journalist but now only employee Bush hating ghetto scum.
Interesting that the more anti-Bush they become, the lower their revenues.
"I had sort of hoped the newspaper business might get a little better in the fourth quarter, but I guess it's not," said Edward Atorino, an analyst for The Benchmark Co.
This guy actually gets paid to analyze financial data?
I did my part. Canceled DMN subscription several yrs. ago.
And didn't it feel good when you didn't write that check?
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