By the Numbers: Q3 Online Earnings for Dow Jones, NYT Co., Belo and More

By: Jay DeFoore Since last week, E&P has been tracking online revenue and traffic information found in top newspaper companies' quarterly earnings statements. Last week, we reported on Media General, which released the most-detailed information for its online properties, as well as Gannett, Tribune, Scripps, and Knight Ridder.

This week, Dow Jones, The New York Times, Belo, and Metro released Q3 earnings. Here's what we found:

Dow Jones:

Paid subscribers to The Wall Street Journal Online grew to 764,000 as of Sept. 30, 2005, up 9.0% from the prior year period. WSJ.com added a total of 63,000 subscribers since Sept. 30, 2004. The Journal's online edition now has a higher circulation than all but four U.S. newspapers.

Dow Jones' Consumer Electronic Publishing division, which includes WSJ.com and its related vertical sites, licensing/business development, radio/audio, and the January 2005 acquisition of MarketWatch, Inc., saw revenues of $43.7 million for Q3, up from $19.2 million from the same period in 2004. Revenue for the nine-month period ending Sept. 30, 2005 clocked in at $124.1 million, up from $57.3 million over the prior nine-month period ending Sept. 30, 2004.

ADDENDUM: This is probably more detail than most care to know, but because news reports of Dow Jones' purchase of MarketWatch from CBS varied from $520 to $528 million, we thought we'd include this explanation from Dow Jones' Q3 report:

On January 21, 2005, the Company completed its acquisition of MarketWatch, Inc. (MarketWatch) for a purchase price of approximately $538 million. The purchase price consisted of cash tendered totaling $507.7 million to acquire the 28.2 million outstanding common shares of MarketWatch; the exchange of 1.2 million stock options valued at $25 million using the Black-Scholes option pricing model; and, direct third party transaction costs of approximately $5 million. This acquisition was financed by $439 million of short-term commercial paper borrowings and cash, including cash received from MarketWatch of $74 million. In February 2005, the Company refinanced $225 million of its commercial paper borrowings with three-year bonds bearing a fixed interest rate of 3.875%.

Other Statistics:

	2005	2004
WSJ.com unique visitors/business day	172,000	142,000
Avg. monthly unique visitors to DJ Online	8,150,000	7,885,000
Avg. monthly page views to DJ Online	28.4 mil	N/A

* Average monthly unique visitors to Dow Jones Online are from Nielsen//NetRatings. This measure includes the following Web sites: WSJ.com, MarketWatch.com, BigCharts.com, Barron's Online, and the Journal's other vertical Web sites.

The New York Times Co.:

"Our News Media Group's Internet properties recorded very robust advertising revenue growth in the quarter, up 30.5%," reported Janet L. Robinson, president and chief executive officer. "To date in October, total advertising revenues for the News Media Group are growing at a rate similar to that for the month of September."

"We continue to be very pleased with About.com, which we acquired last March. Its advertising revenues climbed an estimated 67% in the quarter."

Revenue for About.com during the third quarter was $14.1 million, compared with $33.2 million from its broadcast media group and $743.6 million from the news media group. About.com's profit was about $3.8 million on the strength of an estimated 67% increase in ad revenues for Q3. In a conference call with financial analysts, Robinson said TimesSelect, the company's first major foray into online subscriptions, was "well ahead of expectations." As previously reported by E&P, the Times is boasting a 90% conversion rate for its 14-day free trial version of TimesSelect. One analyst asked about the paid online model for the company's paper in Worcester, N.Y., and whether it was a test case. But Martin Nisenholtz, senior vice president for digital operations, said Worcester was not a model but rather the idea originated with the paper's publisher. Nisenholtz also said About.com was increasing its online advertising rates." We have pushed very hard on the rate side," he said. "Our rates are up September over September 81% so we have increased rates but we think there's more to do. We're not done yet optimizing rates."


Belo:

Advertising revenues associated with the Newspaper Group's Web sites were $7.8 million in the third quarter of 2005, an increase of 55% versus the prior year. Advertising revenues from Belo's Television Group Web sites were $3.2 million in the third quarter of 2005, a 42% increase versus the prior year. ? Excluding the expenses related to special charges, corporate operating expense increased 5.3 percent in the third quarter due primarily to the allocation to the Corporate segment of interactive media expenses previously included in the Interactive Media segment.


Journal Communications:

Online ad revenues increased 50% to $2.5 million for the quarter, driven by a 181% increase in "run of web" revenues, and a 50% increase in the employment category.


Metro International S.A.:

Metro, one of the world's largest publishers of free daily newspapers, said its online businesses had an operating loss of $618,000 for Q3, bringing its total loss since Jan. 1, 2005 to $2.6 million. Net sales were $131,000 for Q3 and $227,000 since Jan. 1.

Metro's new online service businesses, Metro Modern Media, are being reported as a distinct reporting segment for the first time. The new businesses generated revenues in the quarter of US$ 131,000 and incurred an operating loss in the period of $0.6 million. This compares with sales of $96,000 and an operating loss of $1.6 million in the second quarter of 2005.

In April 2005, Metro Modern Media launched a classified advertising site called Metro Market containing approximately 900,000 classified advertisements. This was followed by the launch of Metro Travel, an online "B2C" business offering competitive rates on hotel rooms and city visitor cards to Danish and Swedish customers. During September, Metro City Travel processed 426 hotel bookings and the Swedish site had 32,000 unique visitors during the month. "The trend in bookings, average spend, and unique site visitors are all very positive," the company said.