Newspaper Execs Meet for Mid-Year Review

By: Jennifer Saba There probably won't be a lot of news coming out of the Newspaper Association of America's Mid-Year Media Review, scheduled to kick off in New York tomorrow. Executives presenting to the financial community over the next two days will most likely tread gingerly in light of the difficult environment faced by the industry.

Indeed, judging by some of the companies that have reported May results, there is reason for the prudence. Gannett said its ad revenue was down 6.8%. The New York Times reported that ad revenue fell 8.5%. Dow Jones & Co. said advertising revenue at its flagship The Wall Street Journal declined 3.4%. Ad revenue at Journal Communications was down 9.6%.

In a note released by Goldman Sachs, analyst Peter Appert expects the two days of sessions to be a "relatively cautious affair."

There will be notable absences including Tribune and Dow Jones for the obvious reasons as well as E.W. Scripps, which Appert notes is trying to keep an arm's length away from the industry. "In effort to disassociate itself from the underperforming newspaper sector, Scripps will not be presenting at the mid-year media review conference," he wrote.

For those companies planning presentations, Goldman Sachs offers a preview of what analysts believe will be covered.

Belo: There has been speculation that Belo is going to spin-out its broadcasting division though Appert and his team don't think the Dallas-based company will say much on the matter. "Expect management to spend little time talking about the difficult revenue growth situation and more time discussing their Internet strategy including the growing relationship with Yahoo," analysts wrote.

McClatchy: Goldman Sachs anticipates there will be questions by investors looking for the likelihood the company will go private. Last year, McClatchy skipped the presentations since it had just acquired Knight Ridder. Executives with the company will probably cover the health of its newspaper properties, digital strategies, and debt repayment.

New York Times: Along the lines of McClatchy, there will most likely be questions regarding if the company is planning a structural change. "Investor focus will be on the uses of cash, including the possibility of restructuring action in response to the company's improved liquidity and ongoing shareholder pressure." (Goldman Sachs is not rated on the New York Times.)

Gannett: Management will probably discuss cost controls, its focus on small papers, and improving trends in the United Kingdom.

Journal Communications: Analysts suspect the company will go over its integration of Emmis TV stations and the weakness across its publishing assets.


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