Lee Enterprises revised Q2 earnings to reflect wider loss
Wednesday May 14, 8:48 pm ET
By David Pitt, AP Business Writer
Lee Enterprises revised Q2 earnings report; Increases loss to $716 million
DES MOINES, Iowa (AP) — Newspaper publisher Lee Enterprises Inc. revised figures for its second fiscal quarter Wednesday to include charges related to a reduction in the value of its assets.
The company’s revised report, filed with the Securities and Exchange Commission, indicated a loss of $716.4 million, or $15.90 per share, in the quarter ended March 30.
In April, Lee had reported a loss of $4.45 million, or 10 cents a share, which had included a one-time charge related to its purchase of the St. Louis Post-Dispatch.
The company indicated then that it would revise the report to include a reduction of carry-over asset value.
A year ago, the company earned $11.9 million, or 26 cents a share.
The loss in this year’s quarter included a preliminary pretax non-cash charge of $722 million to reduce the carrying value of goodwill. The company also recorded a charge of $3 million to reduce the value of non-amortized intangible assets and $115.97 million to reduce the carrying value of amortized intangibles.
An additional pretax charge of $90.4 million was recorded as a reduction in the carrying value of the company’s investment in an Arizona partnership that owns portions of the Arizona Daily Star and the Tucson Citizen.
The company said the re-evaluation of its business was due primarily to the continuing and increasing difference between its stock price and the per-share carrying value of its net assets.
“Recent deterioration in the company’s revenue and the overall recessionary operating environment for the company and other publishing companies were also factors in the timing of the analysis,” the company said. “The company concluded the fair value of its business did not exceed the carrying value of its net assets as of March 30, 2008.”
The company said it has not yet completed the determination of fair value because of the timing and complexity of the calculations. The final determination of reductions could change significantly, it said.
Excluding one-time charges, the company earned 8 cents a share in the second quarter compared with 19 cents a year ago.
Sales declined 4.7 percent to $247.7 million for the quarter, and circulation revenue fell 1.7 percent to $49.1 million.
Lee shares fell 30 cents, or 3.9 percent, to close at $7.41. Shares have traded between $7.01 and $26.58 in the past 52 weeks.
Lee Enterprises Inc.: http://www.lee.net
The Enronning of the nation’s dinosaur fishwraps continues and seems to be speeding up.