By: Jennifer Saba Knight Ridder reported its Q3 results this afternoon during a conference call with analysts and investors. It was a busy quarter by any measure, as the company swapped newspapers, announced a stock buyback program, and made major cuts to the newsrooms at two of its big papers (the Philadelphia Inquirer and the San Jose Mercury News). Here are some highlights of the call.
Callers were very interested in Philadelphia, since total ad revenue declined 4.8% in Q3. Philadelphia is particularly having a hard go of it since it's getting hit on all fronts. The Federated/May merger is impacting Philadelphia more than other Knight Ridder markets, on top of soft ad revenues in the national category, said Art Brisbane, senior vice president at Knight Ridder.
One analyst asked executives if Knight Ridder was considering selling the Philadelphia papers, but CEO Tony Ridder said the company has "no intention of doing that."
In fact, Brisbane said Knight Ridder is investing in the paper -- of the top four positions in the ad department, three are new additions to the company. Furthermore, executives assured those on the call that Philadelphia should start showing positive momentum by the second half of 2006.
It's too early to report any possible cost savings from staff cuts in Philadelphia and San Jose, the executives said, but they expect it to be a big number. (The period for the buyout offers last until about the beginning of November.)
When asked if the Knight Ridder was rethinking its model given the cut in editorial, Tony Ridder said that after the reductions, both papers will be generously staffed. "I think we were overstaffed in those two places," Ridder said. "We're just bringing them into line."
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