Publishing company
Gannett (GCI) is best known for the 80 newspapers and 600 magazines it produces. Print publishing is a troubled sector, yet Gannett is making a strong push towards digital offerings.
Gannett divides its business into three divisions: Publishing covers the magazines and newspapers, including the national USA Today paper. Broadcasting is the ownership of 23 television stations.
Finally, Digital includes a portfolio of national and locally focused web sites, including jobs site CareerBuilder.com. In 2011, the publishing division accounted for three-quarters of operating revenue and about half of Gannett's operating income.
For the full year 2011, Gannett reported operating revenue of $5.24 billion, down 4 percent from $5.44 billion in 2010. Excluding special items, earnings for the year was $2.13 per share, down from $2.35.
For the fourth quarter, earnings of 72 cents per share were below the 82 cents earned a year earlier but 4 cents higher than the Wall Street consensus estimate of 68 cents. For 2012, the consensus earnings estimate is $2.21 per share.
Publishing newspapers and magazines is a tough way to make money in an increasingly digital world. In 2011, Gannett saw total operating profits decline by 17 percent, led by a 26 percent drop in operating income from the publishing division. Operating income from the broadcasting division was down by 8 percent for the year.
Digital is the future, and Gannett's digital division proved that in 2011. Operating profits for the division increased by 50 percent compared to 2010 on a division operating revenue increase of 11 percent.
Profitable
However, for the year, digital produced just 14 percent of the company's total operating income. Gannett remains profitable in all three of its divisions.
Analyst Edward Atorino of The Benchmark Company had a positive outlook on Gannett before the fourth quarter earnings report, which exceeded Wall Street estimates. Atorino likes the energy and direction provided by new CEO Gracia Martore.
The company next reports on April 18.
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