By: Mark Fitzgerald With all its bank debt booked as a current liability in the second quarter struggling Journal Register Co. reported late Tuesday that its current assets by the end of June stood at $76.8 million -- and its liabilities were $719.8 million.
In a second-quarter report full of bad news, Journal Register also said it had taken a non-cash goodwill impairment charge of $287.0 million on the mastheads of its depressed Michigan and Pennsylvania clusters of newspapers.
With the charge, Journal Register reported a loss for the quarter of $174.5 million, or $4.43 per diluted share,
Without the charge, Journal Register said, it would have reported net income of $500,000, or 1 cent per diluted share, compared to net income of $5.5 million, or 14 cents per diluted share in the year-ago quarter.
Second-quarter revenue fell 10.4% to $108.1 million, dampened by ad revenue that dropped 13.1%.
Classified ad revenue dipped 15.9% on big drops in real estate (down 24.4%), employment (down 22.4%), and automotive (down 17.9%).
Local retail ad revenue dropped 9.5% on weakness in department and discount store plus financial/insurance categories partially offset by improvements in the medical/healthcare category, Journal Register said.
National advertising revenue, which accounted for just 3.2% of total second-quarter ad revenue, plunged 33.3%.
Online revenues, which Journal Register includes in its advertising results, increased 13.1% for the quarter, and accounted for 6.6% of total ad revenues, up from 5.1% in the year-ago quarter.
Journal Register also reported circulation revenue was up 2.7%, on price increases, and the outsourcing of delivery in its Connecticut cluster.
Hanging over the second-quarter report was Journal Register's big debt burden, most of it taken on for what turned out to be the ill-timed purchase of its suburban Detroit dailies and community papers.
Journal Register was forced to book its net debt of $628.2 million as a liability when its lenders agreed to let it skip interest payments until the end of October. Journal Register's debt is increasing, the company said, and is 1.2% above its net debt reported as of December 30, 2007.
Journal Register did not file the second-quarter report with the Securities and Exchange Commission because it has de-registered its securities. Journal Register withdrew from the New York Stock Exchange earlier this year, and is now traded in the Over-The-Counter market. Tuesday, its stock (Other OTC: JRCO.PK) closed at 2 cents, above its 52-week low of a penny.
The publisher of 22 dailies and 300 non-dailies has a market capitalization of just $1.1 million.
Yardley, Pa.-based Journal Register has said it is exploring strategic alternatives including the sale of all or part of its business. As part of the forbearance agreement with its lenders, it has also agreed to appoint a "chief restructuring officer."
Comments
No comments on this item Please log in to comment by clicking here