By Tess Stynes
Gannett Co. said its first-quarter earnings soared as growth in
the media company's broadcast and digital businesses offset
declines at its publishing division.
Gannett has been aiming to boost the performance of its
newspaper operations by inserting content from its flagship USA
Today into some of its local newspapers, an effort it recently
expanded to other newspaper groups. It follows similar programs
launched by the Washington Post and the New York Times last year
offering supplements of their content to other newspapers.
In the latest quarter, publishing revenue declined 8.8% to
$768.2 million, reflecting softness in print advertising, the sale
of Gannett Healthcare Group and the ceasing of publishing of USA
Weekend at the end of last year. Advertising revenue fell 11% to
$444.4 million, while circulation revenue dropped 3.1% to $273.2
million.
Gannett said it remains on track to spin off the publishing
business from its more lucrative broadcasting business in mid-2015.
With the separation, Gannett will join other media companies that
have or will spin off print-publishing operations from
faster-growing television and digital operations.
Gannett greatly expanded its broadcast operations with its $1.5
billion acquisition of broadcaster Belo Corp. in late 2013, and has
continued to bulk up its digital properties. In October Gannett
completed the acquisition of the 73% interest it didn't already own
in Classified Ventures LLC, which controlled Cars.com.
In the latest quarter, Gannett reported that its broadcast
revenue increased 3.8% to $396.8 million, mostly driven by 26
growth in retransmission revenue that offset the impacts of
year-earlier Olympic and political advertising spending.
Overall, Gannett reported a profit of $112.9 million, or 49
cents a share, up from $59.2 million, or 25 cents a share, a year
earlier. Excluding items, year-earlier per-share earnings were 47
cents. Revenue increased 4.9% to $1.47 billion.
Analysts polled by Thomson Reuters expected per-share profit of
45 cents and revenue of $1.52 billion.
Digital-segment revenue, which is reported separately from
digital revenue in the publishing division, soared 85% to $332.7
million, mostly on results from Cars.com and continued growth at
CareerBuilder.
Write to Tess Stynes at tess.stynes@wsj.com
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