Tribune Co. Follows Gannett In Announcing 2Q Drop — Concerns Grow

By: E&P Staff and The Associated Press

Media company Tribune Co. said Thursday its second-quarter profit slumped on lower newspaper circulation and the sale of some of its television stations. Gannett had announced an 8% earnings dip on Wednesday.

Goldman Sachs on Thursday afternoon issued a note stating that the current results confirm it’s very “cautious” approach to the entire industry. It observed that Tribune had taken a hit despite “Herculean” efforts at cost controls. The industry as a whole faces an “uphill” fight to improve margins as revenue remains in a rut.

Second-quarter earnings slid to $85.7 million, or 28 cents per share, from $231.3 million, or 73 cents per share, during the same period last year. Last year’s results include a 13 cents per share non-operating gain.

This year’s earnings from continuing operations were 53 cents per share, including items that reduced profit by a total of 2 cents per share. Last year’s earnings from continuing operations were 72 cents per share.

On average, analysts polled by Thomson Financial were looking for earnings of 55 cents per share on sales of $1.46 billion.

Quarterly revenue dropped 1 percent to $1.43 billion from $1.45 billion in the prior-year period. Circulation sales declined 5.3 percent to $142 million from $149.9 million during the same period last year.

Broadcasting and entertainment revenue fell 2.4 percent to $403.6 million compared to $413.4 million during the year-ago period. Television revenue edged down approximately 1.3 percent to $320.3 million from $324.4 million last year. Publishing sales were essentially flat at $1.03 billion.

Online revenue was a bright spot, climbing 27 percent to $57 million on strength across all classified categories, Tribune said.

The company saw a pretax loss of $90 million during the quarter, including $80 million of allocated television group goodwill, related to the sale of its Atlanta and Albany television stations.

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