By: Seth Sutel, AP Business Writer
(AP) Dow Jones & Co. reported net earnings of $2.1 million or 3 cents per share for the fourth quarter Thursday as results were depressed by weak advertising and costs from relocating staff out of the World Financial Center, which was damaged in the Sept. 11 attacks.
Without the $32.2 million charge on its office lease and other costs from consolidations and work force reductions, the company earned $29.3 million, or 34 cents a share, beating the lowered expectations of Wall Street analysts polled by Thomson Financial/First Call, who expected 30 cents a share.
In the same period a year ago, Dow Jones, which publishes The Wall Street Journal, Barron’s, Dow Jones Newswires, and several stock market indicators, reported a net loss of $274.3 million or $3.15 per share due mainly to charges related to Bridge Information Systems Inc., a financial data provider that went bankrupt.
Taking out the effect of those charges, Dow Jones earned $73.4 million or 83 cents per share in the fourth quarter of 2000.
The decline in the latest earnings before charges reflected a sharp fall in advertising.
Revenues in the fourth quarter fell 22.7% to $431.5 million from $558.4 million in the same period a year ago.
“2001 was a difficult year for our nation, the economy as a whole, and the financial markets, and particularly for advertising,” Dow Jones Chairman Peter Kann said in a statement. “Consequently, it was a very difficult year for Dow Jones.”
Dow Jones had to evacuate its headquarters located in the World Financial Center, which is adjacent to the World Trade Center, on the day of the Sept. 11 attacks. The company has been operating from a facility near Princeton, N.J., while repairs to the World Financial Center proceed. Journal reporters are also based in some New York offices.
The company announced in October that it plans to permanently relocate about 250 staff members to the New Jersey location once it is able to move its headquarters back to lower Manhattan. As a result the company will occupy less space in the World Financial Center.
Revenues at Dow Jones’ print publishing segment, which makes up the majority of its business, declined 29.8% in the fourth quarter, reflecting what the company called a “difficult” advertising climate.
Advertising linage at The Wall Street Journal fell 41.5% in the fourth quarter compared to the same period a year ago, and was down 37.6% for the year. In the boom year of 2000, linage at the Journal rose 14%.
Dow Jones expects that advertising linage at the paper will decline between 20% and 30% in the first quarter of 2002, and that first-quarter earnings will range between 1 cent and 10 cents per share. Analysts had been expecting 11 cents per share.
Dow Jones called its fourth-quarter net income figures “preliminary” since the company is still evaluating the likelihood that it will use some of its capital loss carryforwards, which would increase net earnings figures. Income before special items would not be affected. The company will decide on the matter before it issues its final 2001 financial statements.
For the full year, Dow Jones reported net income of $68.2 million or 79 cents a share, versus a net loss of $119 million or $1.35 per share for all of 2000. Excluding special charges, earnings fell to $106.8 million or $1.24 per share from $294.6 million or $3.32 per share in 2000.
Full-year revenues fell 19.5% to $1.77 billion from $2.2 billion in 2000.
In morning trading on the New York Stock Exchange, Dow Jones shares were up 83 cents at $54.83 a share.