By: Seth Sutel, AP Business Writer
(AP) Gannett Co., the largest newspaper publisher in the country, reported a 15.8% decline in fourth quarter net profits Thursday as an advertising slump and the slow economy dragged down results.
Gannett, which publishes 95 daily newspapers in the U.S. including USA Today, earned $248.4 million in the three months ending Dec. 30, down from $294.9 million in the comparable period in 2000. The year-ago fiscal period included one more week than the most recent fourth quarter.
Per-share earnings came in at 93 cents, a penny above the consensus estimate of analysts surveyed by Thomson Financial/First Call. In the same period a year ago the company earned $1.11 per share.
Revenues also fell in the quarter as the recession dragged down advertising spending. Gannett’s overall revenues fell 14.3% to $1.62 billion from $1.89 billion in the fourth quarter of 2000.
Gannett’s chief executive Douglas H. McCorkindale said in a statement that newspaper advertising revenues declined across the board, especially in help-wanted classified. He also said broadcast advertising fell from the same period a year ago, when results were lifted by advertising related to the Olympics and the elections.
Paid advertising pages fell 30% at USA Today in the fourth quarter, which the company attributed to poor demand for travel-related advertising following the Sept. 11 terrorist attacks, the overall ad recession and fewer business days in the most recent quarter. For the full year, paid ad pages fell 24% at USA Today.
Newsprint expenses declined 18% in the fourth quarter due to lower prices and usage.
For the full year, Gannett’s net income fell 51.6% to $831.2 million from $1.72 billion in 2000, which included a one-time gain of $744.7 million from the sale of cable systems.
Without the effect of that gain, earnings from continuing operations fell 14.5% from $971.9 million a year ago. On that basis, per-share earnings fell to $3.12 from $3.63 a year ago. Full-year revenues rose 2% to $6.34 billion from $6.22 billion in 2000.
Gannett’s shares were up $1.50 at $68.01 in midday trading on the New York Stock Exchange.