Gannett Falls After Missing Revenue Estimates on Print-Ad Drop

Monday, 31 Jan 2011 04:04 PM

 

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Gannett Co., the owner of 82 newspapers as well as television stations, fell the most in more than three months after reporting sales that missed analysts’ estimates after a decline in print advertising.

Gannett’s fourth-quarter revenue was little changed at $1.46 billion, compared with the average analyst estimate of $1.47 billion according to a Bloomberg survey. The company’s advertising revenue from publishing fell 5.9 percent, including a 7.8 percent drop in national advertising.

“The economy has continued to be a little bit of a conundrum,” Gracia C. Martore, president and chief operating officer, said on a conference call with investors. “There is still a lot of uncertainty.”

Gannett, whose newspapers include USA Today, fell 44 cents, or 2.9 percent, to $14.75 at 3:50 p.m. in New York Stock Exchange composite trading. The stock fell as much as 4.8 percent, the largest intraday decline since Oct. 15.

Net income for the quarter rose to $174.1 million, or 72 cents a share, from $133.6 million, or 56 cents, a year earlier, the McLean, Virginia-based company said today in a statement. Earnings, excluding some items, rose to 83 cents a share. Analysts projected 81 cents on average, according to estimates compiled by Bloomberg.

Gannett, the first large newspaper publisher to report its results for the quarter, is watched by investors as an indicator of how the industry is faring. The company’s publishing revenue, including advertising and circulation, declined 4.7 percent in the fourth quarter to $1.06 billion. The print decline was offset by a 27 percent gain in broadcast-TV revenue and 5.2 percent increase in digital revenue.

Television Rise

“Television has been booming, and there’s slow sequential improvement in publishing,” Edward Atorino, an analyst at Benchmark Co. LLC in New York, said in an interview. “The outlook for TV is very good and hopefully publishing will continue to improve in 2011.”

Broadcasting revenue rose to $232.8 million, and digital revenue reached $165.8 million in the fourth quarter.

Revenue for the year slid 1.3 percent to $5.44 billion, the fourth straight annual decline.

Gannett said it had $3.6 million in pretax costs for a workforce restructuring and $36.7 million in asset impairments and the consolidation of some facilities. Operating expenses fell because of the building consolidations and other cost-cutting efforts.

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