The McClatchy Company
In a new earnings report released this morning, McClatchy announced that revenue was down 5.1 percent over the first quarter of 2011. Some of the costs contributing to the loss were unlikely to be repeated — $2.9 million “primarily related to relocating Miami newspaper operations” — but others may return: “Severance charges totaling $1.2 million ($0.7 million after-tax) related to continued restructuring of the company’s operations.” Operating cash expenses at McClatchy were also down $9 million.
CEO Gary Pruitt, who is leaving McClatchy next month to head the Associated Press, reported advertising revenue overall was down 6.8 percent over the first quarter. Those losses were higher at the beginning of the year than in April, a trend Pruitt said in a release McClatchy was “pleased to see.” But digital-only advertising was up 14 percent; bundled digital advertising was up 2.7 percent.
The company’s equity investments returned $6 million this quarter. The company says it expects more cost-cutting, lower newsprint costs and a “growing set of products and revenue initiatives, especially in digital and direct marketing advertising” to contribute to a further decline in cash expenses next quarter.
McClatchy’s 9.2 percent decline in print advertising revenue is a bit worse than other large newspaper chains’ recent earnings reports. The New York Times Company reported first quarter earnings that beat expectations; nonetheless, print advertising revenues were down 7.2 percent across its properties. Media General posted a net loss of 23 percent in its first quarter earnings with print advertising down 8.4 percent. Gannett, too, had a poor first quarter, with earnings down 24 percent and an 8.3 percent drop in print advertising.