By: E&P Staff
Journal Communications Inc. on Wednesday joined the ranks of those reporting mostly positive year-over-year results for Q2, with the expected mixed news from the publishing segment.
The company reported $104.4 million in revenue from continuing operations, a very slight increase of 0.1% compared to $104.3 million in Q2 2009. Its operating earnings of $14.4 million are compared to a Q2 2009 operating loss of $9.5 million, which included a $19.0 million impairment charge for broadcast licenses.
In its publishing segment revenue was down 4.1% to $47.4 million, compared to $49.4 million, the company said, citing continued decreases in all advertising categories offset by an increase in commercial print revenue. Operating earnings from publishing were $6.6 million, up from $4.4 million — an increase of 51.7%. Total newsprint and paper expense in publishing was up, at $4.6 million compared to $4.5 million, a 2.5% increase primarily due to the increasing price per ton of newsprint.
Q2 revenue at the Milwaukee Journal Sentinel slipped 2.3% to $39.0 million compared to $39.9 million. Retail advertising revenue at the daily newspaper decreased 5.6%. Classified advertising revenue at the daily newspaper fell 9.5%, due in large part to losses in the real estate, automotive and other advertising categories.
Interactive advertising revenue at the Journal Sentinel was up 11.5% to $2.8 million compared to $2.5 million, due mostly to an increase in retail sponsorships and classified packages, the company said. Operating earnings from the daily newspaper were $5.4 million compared to $3.3 million — an increase of 63.3%.
Journal Sentinel operating expenses decreased 8.3%, due to reductions in employee-related costs, other cost-reduction initiatives and reduced expenses related to revenue declines partially offset by a $0.2 million increase in newsprint and paper expense, Journal Communications stated.
Circulation revenue for the Journal Sentinel was down 2.3%, from $12,787,000 in Q2 2009 to $12,508,000.
Revenue generated by Journal Communications’ community newspapers and shoppers in Q2 fell 11.9% to $8.4 million compared to $9.5 million, a loss the company said was due to declines in the automotive, retail and real estate advertising categories. Operating earnings from community newspapers and shoppers was $1.2 million compared to $1.0 million, an increase of 14.1%. Operating expenses were down 15.1%, primarily due to cost savings from previous reductions in workforce and reduced expenses related to revenue declines.
Its broadcasting segment fared better: revenue from that segment grew 7.5% to $47.0 million compared to $43.8 million. Local advertising revenue, excluding political advertising, was up 1.3%, and national advertising revenue increased 16.1%. Total broadcast political and issue advertising revenue was $1.9 million, up from $0.6 million in year-over-year comparisons.
Journal Communications said its $117.8 million in debt represented 1.60 times the trailing four quarters of EBITDA. During the quarter and year-to-date, debt was reduced by $16.9 million and $33.6 million, respectively. Year-to-date cash from operating activities was $37.9 million compared to $47.0 million (which included income tax refunds of $8.7 million), and year-to-date capital expenditures were $5.8 million compared to $3.8 million.