Follow the Money

By: Jim Rosenberg Newspapers are likely to boost investments in plant and equipment by almost 10% this year, according to survey results released last week by the Newspaper Association of America. Overall, 260 respondents said they plan to spend $512.6 million this year, compared with actual spending of $467.3 million last year.

For anyone trying to make year-to-year comparisons, it's worth noting that 2002 spending by this year's respondents was less than a million dollars short of expenditures projected by last year's 196 respondents. Tom Croteau, NAA's senior vice president for technology, noted that although 64 more newspapers returned the survey this year than last year, their total circulation is only 1% or 2% higher than last year's group. "What that tells me is that I've gotten more small and medium papers than in the past," he said.

Plant construction - at $140.5 million, 7.7% lower than last year's spending by the same group of papers - and presses ($101.5 million in all) remain the largest categories. The next-largest outlays are for computers - $71.6 million for software, $56 million for hardware - with projected increases approaching 50%.

Respondents this year plan to spend significantly less (35.9%) on internal communications and significantly more (68.7%) on external communications than they spent in those categories last year - an inversion of the comparison between 2002 plans and 2001 spending.

This year's group also anticipates spending substantially more for warehouse newsprint roll- and pallet-handling equipment (256.3% and 59.5%, respectively) and image-output devices (76.6%, excluding all platemaking equipment). A big difference is seen in commercial-printing equipment - where this year's respondents' actual 2002 spending of almost $5.3 million vastly exceeded last year's respondents' planned 2002 spending of $587,447.

While new inserters and collators remain a high-dollar category, plans for this year are close to last year's investment of almost $23.5 million, which was less than half of what last year's group planned to spend. But projected declines in used inserters and collators and other used and new post-press purchases can best be described as steep (85.9%) and steeper (94.5% and 48.9%).

Last year's and this year's groups also were far apart in their investments in nonmaterial inputs and nonproductive outputs. Whereas the former group projected spending on energy- and security-management equipment would rise 46%, to $6.73 million in 2002, the latter group spent $10.28 million for the same sort of systems. And the $467,786 sunk into waste management by this year's group didn't come close to the $1.88-million outlay planned by last year's group. Nevertheless, the 2003 respondents do expect to pay 53.6% more this year than last year to deal with waste.