By: E&P Staff
The New York Times Co. Wednesday reported its fourth-quarter earnings from continuing operations fell 48% on write-downs on severance costs and non-cash charges on the value of the International Herald Tribune and New England papers, including its stake in the free Boston Metro daily.
Times Co. said its earnings per share for the quarter was 19 cents, including a 10-cent per-share charge for severance costs and a 7-cent per-share charge for the write-down of assets.
Operating profits for the quarter fell to $63.3 million from $101.5 million in Q4 2007. Excluding special items, operating profit from continuing operations decreased to $118.5 million from $159.2 million a year ago.
Total revenue fell 10.8% to $772.1 million from $865.8 million.
Advertising revenue plummeted 17.6%, mostly on decreases in newspaper advertising.
Times Co. circulation revenue was up 3.7% on higher prices for The New York Times and The Boston Globe.
Internet and other online advertising slowed in the quarter, Times Co. President and CEO Janet L. Robinson said.
“After growing almost 15% in the first nine months of last year, digital advertising decreased 3.5% in the fourth quarter as online marketers cut back on display ads in response to worsening business conditions,” she said in a statement.
“In this time of unprecedented change, we are responding strategically and creatively to manage our businesses and prepare for our future, while preserving the flexibility to navigate this difficult period,” Robinson added, alluding to the 74% cut in Times Co.’s quarterly dividend.
Robinson noted that operating costs fell 8.5% in the quarter, and for the year were down 4.7%, or $136 million, despite the rise in newsprint prices.
In the fourth quarter, Times Co. took a non-cash charge of $19.2 million, or $10.7 million after tax on a write-down of goodwill at The International Herald Tribune. It also took a non-cash charge on goodwill at the Worcester (Mass.) Telegram & Gazette, and a write-down of $7.1 million, or $4.1 million after tax, on its 49% stake in Metro Boston LLC, publisher of the free Metro in Boston and its suburbs.
Severance costs also chipped away at earnings. The severance costs, which included $19.9 million to shut down the City & Suburban newsstand distribution subsidiary earlier this month, totaled $24.1 million, or an after-tax charge of 10 cents a share.
Newsprint expenses jumped 11%, with a 33% spike in prices being offset in part by a 22.3% decrease in consumption.