Knight Ridder, Scripps earnings jump | VailDaily.com
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Knight Ridder, Scripps earnings jump

NEW YORK – Newspaper publisher Knight Ridder Inc. reported sharply higher earnings Friday on the sale of newspapers in Detroit and Tallahassee, while E.W. Scripps Co.’s profits rose on continued growth in its cable TV networks and in its new online shopping subsidiary, Shopzilla.Knight Ridder earned $253.2 million in the third quarter, or $3.56 per share, up from $76.9 million, or 99 cents per share, in the same period a year ago. Revenue rose 2 percent to $723.8 million.The profit boost was driven by a one-time gain of $207.9 million from the sale of the Detroit Free Press and the Tallahassee Democrat, as well as 2 cents per share from classifying those properties as discontinued operations.Excluding the gains, earnings fell to $43.6 million, or 61 cents per share, from $72.2 million, or 93 cents per share, a year earlier. Excluding one-time effects including 8 cents per share in severance costs, the earnings beat analysts’ expectations by a penny per share, as estimated by Thomson Financial.Still, the underlying growth in advertising at Knight Ridder’s newspapers was 1.8 percent in the quarter, excluding newspapers that it acquired from Gannett Co. Knight Ridder’s chief executive officer, Tony Ridder, said in a statement that the “fundamentals of this quarter were disappointing.”Knight Ridder’s costs jumped 7 percent in the quarter, or 5.5 percent without the severance costs, but Ridder said much of those increases were temporary and wouldn’t be seen again in the fourth quarter, when he expected costs to rise only about 1 percent.The company didn’t provide a revenue or earnings forecast for the fourth quarter. Last month, Knight Ridder warned investors that earnings would slump on lower advertising revenue from three of its large newspapers and other factors.Knight Ridder also said last month it would cut The Philadelphia Inquirer’s editorial staff by 15 percent and the Philadelphia Daily News’ staff by 19 percent because of decreased circulation and revenue.Knight Ridder’s shares rose $1.04, or 1.89 percent, to close at $56.19 on the New York Stock Exchange, where they have traded in a 52-week range of $54.76 and $71.07.Scripps, which is based in Cincinnati, said earnings jumped 48 percent to $82.2 million in the quarter, or 50 cents per share, from $55.6 million, or 34 cents per share. Revenue rose 19 percent to $594.7 million.The results included a $40.8 million cash payment resulting from a decision to discontinue publishing an afternoon daily in Birmingham, Alabama.Scripps cited continued growth at its booming cable networks division, where advertising revenue jumped 27 percent. That division includes the HGTV, Food Network and DIY Network cable channels.Shopzilla posted a profit of $7.3 million on $35.2 million in revenue, compared with $1.2 million on sales of $15.9 million a year ago.Profit in Scripps’ newspaper division fell 23 percent to $41.6 million. The company attributed much of the decline to costs associated with combining production of the two major daily newspapers in the Denver region. Scripps CEO Kenneth Lowe said the consolidation will increase efficiencies and cost savings in the long term.Scripps’ shares slipped 26 cents to close at $48.55 on the NYSE, where they have traded in a 52-week range of $44.73 to $52.91.—Associated Press Writer Lisa Cornwell contributed to this report from Cincinnati.—On the Net:http://www.kri.comhttp://www.scripps.com


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