A.H. Belo Reports $103 Million Q1 Loss on Big ‘Providence Journal’ Write-Off

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By: Mark Fitzgerald

Dallas-based A.H. Belo Corp. Monday reported a first-quarter net loss of $103.1 million, or $5.03 a share, on a big goodwill impairment charge for The Providence (R.I.) Journal.

Without the $80.9 million, or $3.93 a share, non-cash charge on the value of the Journal — plus another $4 million, or 19 cents a share related to layoff and buyout costs across the chain — Belo had a net loss of $18.1 million, or 91 cents a share.

Total revenue fell 19.8% from the year-ago period to $128.5. Combined print and online advertising revenue dropped 28.2%, mostly on classified declines in all Belo newspaper markets.

Internet revenue accounted for 7.2% of total revenues in the quarter — and fell 24% to $9.3 million.

Cashflow measured by EBITDA (earnings before interest, taxes, depreciation and amortization) fell by $9.1 million overall compared to the first quarter of 2008. Newspaper EBITDA was down $2.3 million.

Circulation revenue rose 9% mostly on increased prices for single copy and home delivery at the flagship Dallas Morning News and at the Journal.

Belo noted consolidated operating expenses of $150.5 million represented a 12.5% drop from the year-ago quarter. Newsprint expense alone was down $2.2 million.

Belo, which was spun out as a debt-free newspaper pure-play from Belo Corp. in February 2008, reported total borrowings of $12.7 million, and said it was in compliance with bank covenants at the end of the quarter.

“A. H. Belo continues to face significant revenue challenges in 2009,” Chairman, President and CEO Robert W. Decherd said in a statement. “Lower advertising revenues require us to continue to focus on expense reductions and operational realignment. These efforts resulted in significantly lower expenses in the first quarter, approximately $21.5 million below the first quarter of 2008 excluding the non-cash goodwill impairment charge of $80.9 million.”

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