Gannett 4Q profit down 12 pct on lower ad spending

Friday, January 31, 2014, Vol. 38, No. 5

MCLEAN, Va. (AP) — Gannett Co. said Tuesday that its fourth-quarter net income dropped 12 percent, partially a result of the absence of the record-high political advertising that boosted its results a year earlier.

The media company, which publishes USA Today and owns dozens of newspapers and television stations, earned $90.7 million, or 39 cents per share, for the quarter that ended Dec. 29. That was down from $103.1 million, or 44 cents per share, in the same quarter of 2012.

Excluding one-time items, which included restructuring and other costs, the company said it posted adjusted earnings of $152.5 million, or 66 cents per share, for the recent quarter.

The company noted that an extra week in the fourth quarter of 2012 also lifted the company's results for that period by 3 cents per share.

Revenue fell 10 percent to $1.37 billion from $1.52 billion, hurt by the steep drop in political advertising. Excluding the effects of political advertising, Gannett said revenue was roughly flat compared with a year earlier.

Despite the drops, earnings were slightly ahead of Wall Street's predictions, while revenue matched expectations. Analysts polled by FactSet expected earnings of 65 cents per share on $1.37 billion in revenue.

Excluding the effects of the extra week in 2012's fourth quarter, publishing revenue fell 5 percent to $944.3 million on lower advertising. Meanwhile, revenue at the company's broadcast division fell 16 percent to $228.2 million, largely due to the drop in political advertising.

Excluding political advertising, the company said broadcast revenue from its TV stations jumped 23 percent, helped by the closing of its $1.5 billion acquisition of Belo Corp. in December.

Digital revenue rose 4 percent to $195.6 million, helped by revenue growth at its CareerBuilder website.

For the full year of 2013, Gannett earned $388.7 million, or $1.66 per share, down from $424.3 million, or $1.79 per share, in 2012. Revenue fell to $5.16 billion from $5.35 billion.

In midday trading, the McLean, Va.-based company's stock rose 53 cents, or 2 percent, to $27.04.