No Red October for Gannett as Political Ads, Classifieds Jump

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By: E&P Staff

Gannett Co. said Friday its pro forma operating revenues shot up 8.4% in October on “solid local and classified advertising” among its newspapers and strong political advertising in its broadcast properties.

Gannett said continued increases in the exchange rate with the British pound affected results from its United Kingdom properties. If the exchange rate had remained constant, the company said, pro forma operating revenues would have increased 7.4%. Pro forma results assume all properties a company owns were owned in both the current and year-ago period.

Newspaper ad revenues in October increased 5.6% over the same period in 2003, on what Gannett said was a modest increase in ROP (run of press) volume and a slight decrease in preprints.

Classified revenue was up 8.9% in October, Gannett said, although on a constant currency basis the increase would be 6.7%. On that same basis, the employment category was up 14.9%, real estate up 7.6%, and automotive down 5.6%.

Local advertising revenues were up 5.0% on a constant currency basis, with the chain’s small and medium-sized advertisers outpacing the revenue performance of its biggest advertisers, Gannett said. “In the U.S., across all products, local ad revenue gains were achieved in the furniture, health and telecommunications categories while there was softness in the department store, consumer electronics, entertainment, grocery, financial, restaurant and home improvement categories,” the company said.

Overall newspaper national advertising revenues fell 1.6% on a 1.0% decline in ad volume. National ad volume was up at Gannett’s 100 local papers by 3.1%, but down at the flagship national daily USA Today. Gannett said USA Today advertising revenues were down 6.2% on a 20.8% decline in paid ad pages to 469 from 592. “For the tenth period [October] at USA Today, strength in the financial, advocacy and pharmaceutical categories was more than offset by weakness in the travel, entertainment, automotive, technology and telecommunications categories,” Gannett said. The company noted that in the same period in 2003, USA Today’s advertising revenues were up 15.0% from the year before.

Year-to-date, Gannett said, USA Today’s paid pages numbered 3,916 versus 3,931 last year while ad revenues were 9.4 percent higher than last year.

Gannett said its pro forma broadcasting revenues were up increased 34.8% in the period. Television revenues rose 34.2% in the period reflecting “substantially higher political advertising,” Gannett said.

“Based on October results and pacings for November and December, television revenues are currently ahead of last year’s fourth quarter revenues in the mid teens,” Gannett reported.

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