Media General's Net Income Falls in 3Q

By: STEPHANIE STOUGHTON, AP Business Writer (AP) Media General Inc., a newspaper publisher and TV station operator, said Wednesday its third-quarter income fell 38% due to lower broadcast revenue, as well as higher newsprint and energy expenses.

The Richmond, Va.-based media company earned $9.8 million, or 41 cents a share, in the quarter ended Sept. 25. That compares with $15.7 million, or 66 cents a share, in the year-earlier period.

Analysts surveyed by Thomson Financial had expected the company to earn 40 cents a share.

Media General warned last month that its third-quarter earnings would fall significantly below Wall Street's estimates. The company said it also had higher-than-expected costs related to "wall-to-wall" hurricane coverage and the launch of new Spanish-language products in Florida.

At the time, the owner of the Richmond Times-Dispatch said it expected to earn 38 cents to 41 cents per share in the quarter -- much lower than analysts' expectations of 62 cents per share.

Sales in the quarter rose 1.5% to $220.8 million from $217.6 million in the year-ago period.

Profit in Media General's publishing division fell 8.8% to $27 million in the quarter from $29.6 million a year earlier. Publishing revenue rose 3.2% to $142.1 million, with The Tampa Tribune pulling in the highest gain of 7.6%.

In the broadcast division, profit fell sharply to $12.4 million in the quarter from $20.2 million in the prior year's quarter. Broadcast revenue decreased 3.4% on lower political and national advertising sales.

The company's small interactive-media division lost $918,000. But its revenue rose 49.3% to $5.3 million.

Marshall N. Morton, Media General's chief executive officer, said advertising revenue growth in the company's publishing and broadcast divisions "continues to be at the top of their respective industry peer groups."

For the first nine months of the year, Media General lost $268 million, or $11.22 a share, compared to a profit of $43.3 million, or $1.83 a share, in the year-earlier period. In the first quarter, the company took a $325.5 million charge after it changed the way it values its broadcast licenses.

The accounting change, which affects Federal Communications Commission licenses tied to television-station acquisitions in 1997 and 2000, was required by the Securities and Exchange Commission.

Revenue increased 3.4% to $672.5 million in the first nine months of 2005 from $650.7 million in the year-ago period.

Media General operates primarily in the Southeast. It also owns the Winston-Salem (N.C.) Journal; as well as 22 daily community newspapers and more than 100 weekly newspapers and other publications. Its broadcast assets include 26 network-affiliated television stations.