By: E&P Staff
Journal Register Co. reported a fourth-quarter loss of $25.1 million, or 64 cents a share, on a $35.1 million write-down on the value of its Michigan newspapers and its investment in the online newspaper advertising business PowerOne Media LLC.
Without this one-time charge, Journal Register said it earned $10.1 million, or 26 cents per share, a decline from the fourth quarter of 2005, when it earned of $12.5 million, or 31 cents per share. There was one more week in the 2006 fourth quarter than the year-ago quarter.
Same-property revenue was up slightly to $131.9 million from $130.5 million.
Ad revenue was flat at $102.2 million, the Yardley, Pa.-based newspaper publisher said.
For the fifty-three week year ended December 31, 2006, Journal Register reported adjusted net income of $34.8 million, or 88 cents per share, compared to $46.9 million or $1.12 per share for the fifty-two week year ended December 25, 2005.
In addition to the fourth-quarter charge, the full-year adjusted net income The Company’s full year 2006 adjusted net income also excludes a one-time charge for a non-compete/separation arrangement of $2.5 million after tax that was taken in the second quarter and a one time charge of $3.4 million after tax related to the re-pricing of its refinanced credit facility that was recorded in the first quarter.
“As expected, print advertising remained difficult during the quarter particularly in our Michigan cluster,” Chairman and CEO Robert M. Jelenic said in a prepared statement. “However, the quarter did reflect a relatively strong Period 12 (December) in automotive advertising which helped our overall performance for the period.”
Jelenic said he expected improvements in 2007 because of new media efforts, including co-branded Yahoo! HotJobs internet employment Web sites that will be rolled out to all its clusters by the beginning of the second quarter.
He said the non-cash goodwill adjustment taken for the Michigan cluster was due to continued softness in the overall Michigan economy.
“However, we are expecting to post improvements in 2007 and are committed to the longer term strategy which includes the opening of our new production facility, strong cost controls and belief in the future of the Michigan economy,” he said. “This charge in no way diminishes our belief in this important asset and our commitment to improving its performance and value in the future.”
Journal Register said its fourth-quarter retail advertising revenues for the fourth quarter of 2006 increased 0.3%, but decreased 2.7% for the full year.
Same-property classified advertising revenues decreased 0.6% in the fourth quarter, it said. Real estate classified decreased 6.8%; employment was down 0.7%; and automotive declined 1.9%.
For the year, classified ad revenues were down 3.8%.
National ad revenues, which Journal Register said represent less than five percent of total ad revenues, were down 18.8% for the quarter, and 10.6% for the full year.
Circulation revenues for both existing and papers sold during the year increased 3.5% to $26.6 million for the fourth quarter of 2006 from $25.7 million for the year ago period. For the full year circulation revenues decreased 1.1% to $101.8 million.