JOURNAL REGISTER CO. HAMMERED ON MESSAGE BOARDS

By: Jennie L. Phipps Disgruntled Employees Fire Nasty Shots

For the most part, the newspaper stock message boards hosted by Yahoo!, The Motley Fool, and Raging Bull are pretty dull.

Sure, Times Mirror took a few punches over the business of sharing profits on the Staples section with an advertiser, and there are a fair number of Tribune Co. stockholders whining over the declining price. But in general the tone of these Internet message boards, which represent virtually every publicly traded newspaper company, is friendly, businesslike, and boring.

Until you visit the Yahoo! message board for the Journal Register Co. (JRC) of Trenton, N.J. Posted there are about a dozen vitriolic shots lobbed angrily at the company every day. The messengers are mostly anonymous and unmistakably employees. On the rare occasion that somebody has something good to say, he'll be attacked viciously for having the nerve to post.

Why is JRC singled out for this kind of nastiness? Indisputably, the company has taken some knocks in the business for being a penny pincher. Certainly this owner of 25 daily newspapers and 194 weeklies hasn't been at the top of the Pulitzer Prize list, but when pushed, even critics have trouble finding many specific reasons for complaint.

Analyst isn't surprised by nastiness

Morgan Stanley analyst Douglas M. Arthur, who observes JRC regularly, said, ?I think that JRC makes the newspapers better. They buy companies and improve both the product and the profitability.?

The company is indeed profitable. In fact, Arthur calls it the most profitable newspaper company in the country with margins that are higher or at least equal to those of Gannett Co. Inc., the big dog among publicly traded newspaper companies.

Typical complaints on the message board run the gamut from personal attacks on company chairman, president, and CEO Robert M. Jelenic to nagging diatribes about short staffing and short-sighted middle managers.

Morgan Stanley's Arthur isn't shocked by the tone of the postings. ?Management is very tough and very tight fisted,? he said. ?It's a smaller company where management is in everybody's face. The guys in Trenton who run JRC know what time the presses quit in New Haven [where the company owns the New Haven Register]. They're very, very hands-on managers, so it doesn't surprise me that they have employees who are unhappy.?

Actually, the loudest voice on the JRC board is no longer an employee. Ken Krayeske, 27, used to be a reporter for The Register-Citizen in Torrington, Conn., where he says he covered spot news and the Litchfield Town Council. He says he quit more than a year ago over an overtime dispute with the company. Ultimately, the company paid up, but since then Krayeske has been a dedicated force for ill will on the boards, which are used by investors to share information.

?I don't know whether this influences stock prices - I doubt it does - but if some investor reads it and decides not to invest in JRC because of what we say, then it's worth it,? Krayeske said.

JRC pays attention

JRC does pay attention. Chuck Pukanecz, vice president of news for the company, picked up the phone and called this reporter unsolicited in response to my questions posted to the message board about the tone of the conversation there. Pukanecz said that he doesn't monitor the board closely himself, but others do. He finds the criticism leveled there unfair.

?If you look at papers we've acquired, there has been change and clear improvement,? he said. ?I'm proud of the papers I'm putting out and a lot of our employees are too.?

Asa Graves, an analyst for First Union Securities, believes it's hard to know if the exchanges on the boards have hurt stock prices, which are now below the $14 initial public offering in 1997, probably because of the high debt levels from constant acquisitions. ?I used to get on that board and say, 'What the heck is going on here,' but then I noticed that the most frequent posters appeared to be reporters [who work for the company] and their spelling was horrible, so I started to discount what they were saying.?

Tomorrow, Graves will be among the analysts to tour JRC's Primos, Pa., printing plant. ?JRC is doing that instead of the typical marketing trip because everybody is complaining about their message boards and how what's said there is so gawd-awful,? Graves said. ?They're going to walk us through the printing plant and show us that the paint isn't coming off the walls and the machines aren't held together with Band-Aids. If Bob (Jelenic) can walk out onto the floor without somebody clubbing him, I'm going to ignore those message boards.?

In the aftermath of his departure from the Register-
Citizen, Krayeske has gone into business for himself, photographing minor league baseball teams and creating trading cards from the pictures. He says he'll never work again for a major newspaper company. ?The newspaper industry is dying because of people like JRC,? he said.

But rigor mortis doesn't seem to have set in at his former employer. The company announced record third quarter results with net income increasing 219% to $11.5 million versus the same period in 1998, when there were some extraordinary expenses. In a statement to stockholders, Jelenic said, ?Our record results were driven by solid advertising revenue increases.?

Pukanecz summed up the company's attitude toward the board this way: ?We're a company that's about growth and change. Some people just don't deal with that very well.?

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Jennie L. Phipps (jennielp@bignet.net) is an independent writer and editor in Bloomfield Hills, Mich. She writes frequently for Editor & Publisher Interactive.


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