Gannett Co., Inc. (NYSE:GCI) reported today that total pro forma
operating revenues for the first period ended February 3, 2008 declined
7.5 percent compared with the same period in 2007. The exchange rate of
the British pound was virtually flat with last year and therefore had no
meaningful impact on results.
Pro forma newspaper advertising revenues in the first period were 9.2
percent lower compared with a year ago. Pro forma assumes all properties
presently owned were owned in both periods.
Pro forma retail advertising revenues declined 7.2 percent in January.
While the department store and restaurant categories were relatively
unchanged year-over-year, the furniture, consumer electronics,
financial, telecommunications and home improvement categories lagged
last year’s results.
Pro forma classified revenues declined 16.1 percent in the first period.
Real estate revenues were 25.3 percent lower, employment revenues were
down 19.1 percent, and automotive revenues declined 14.9 percent. At our
U.S. community newspapers, pro forma classified revenues were down 19.4
percent in January reflecting declines of 29.5 percent in real estate
revenues, 24.6 percent in employment revenues and 12.6 percent in
automotive revenues. Classified revenues at Newsquest in the UK were 9.7
percent lower, in pounds. Real estate revenues declined 16.1 percent,
employment revenues were 7.0 percent lower and automotive revenues were
down 22.6 percent. For comparison purposes, classified revenues at
Newsquest were up 19.4 percent in pounds in 2007’s
first period comprised of increases in real estate and employment of
36.5 percent and 21.7 percent, respectively, and a 2.1 percent decline
Pro forma national advertising revenues in January were 5.9 percent
higher. At USA TODAY, advertising revenues advanced 7.3 percent on paid
ad pages of 294 versus 310 last year. In the first period of 2008 at USA
TODAY, strong growth in the entertainment, financial, travel, packaged
goods and pharmaceutical categories was partially offset by declines in
the technology, automotive, advocacy and telecommunications categories.
Strong results for USA WEEKEND also contributed to the revenue growth.
Pro forma broadcasting revenues, which include Captivate, were 6.0
percent lower in the period. Television revenues were down 5.9 percent
in January as local and national revenues were 7.8 percent and 4.2
percent lower, respectively. Significantly higher political advertising
was offset by the absence of ad demand related to the Super Bowl that
benefited our CBS affiliates in 2007 and a softer economic environment.
Based on results to date and current pacings, television revenues for
the first quarter of 2008 would lag last year’s
first quarter on a percentage basis in the mid single digits.
Based on figures from Nielsen//Net ratings, in January, Gannett’s
domestic Web sites had 25.8 million unique visitors reaching 15.9
percent of the Internet audience.
On May 7, 2007, the company completed its sale of the Norwich (CT)
Bulletin, the Rockford (IL) Register Star, the Observer-Dispatch in
Utica, NY, and The Herald-Dispatch in Huntington, WV. In addition, the
Chronicle-Tribune in Marion, IN, was contributed to the Gannett
Foundation on May 21, 2007. The revenue and statistical data related to
these properties has been excluded from all periods presented. For
comparison purposes, a schedule of the company’s
quarterly statements of income for 2007 reflecting the reclassification
of results from these properties to discontinued operations is attached.
To conform with current year presentation, the company's equity share of
operating results for 2007 from its newspaper partnerships, including
Tucson, which participates in a joint operating agency, the California
Newspapers Partnership and the Texas-New Mexico Newspapers Partnership
have been reclassified from "Other revenue" and are reflected in a
separate line in the Non-Operating section of the Statement of Income
titled "Equity income in unconsolidated investees, net." Other revenue
is now comprised principally of commercial printing revenues and revenue
Due to the increasing contribution to revenue from online advertising as
well as publications for which volume is not tracked, ad volume
statistics are less meaningful and therefore, beginning with this
period, will no longer be included in the monthly release. Circulation
volume numbers for Newsquest’s paid daily
newspapers are included in the enclosed statistics, but volume from
unpaid daily and non-daily publications is not included in the
circulation volume statistics.
Gannett Co., Inc. is a leading international news and information
company that publishes 85 daily newspapers in the USA, including USA
TODAY, the nation's largest-selling daily newspaper. The company also
owns nearly 900 non-daily publications in the USA and USA WEEKEND, a
weekly newspaper magazine. Gannett subsidiary Newsquest is the United
Kingdom’s second largest regional newspaper
company. Newsquest publishes nearly 300 titles, including 17 daily
newspapers, and a network of prize-winning Web sites. Gannett also
operates 23 television stations in the United States and is an Internet
leader with sites sponsored by its TV stations and newspapers including
USATODAY.com, one of the most popular news sites on the Web.
Certain statements in this press release may be forward looking in
nature or “forward looking statements”
as defined in the Private Securities Litigation Reform Act of 1995. The
forward looking statements contained in this press release are subject
to a number of risks, trends and uncertainties that could cause actual
performance to differ materially from these forward looking statements.
A number of those risks, trends and uncertainties are discussed in the
company’s SEC reports, including the company’s
annual report on Form 10-K and quarterly reports on Form 10-Q. Any
forward looking statements in this press release should be evaluated in
light of these important risk factors.
Gannett is not responsible for updating the information contained in
this press release beyond the published date, or for changes made to
this press release by wire services, Internet service providers or other
Gannett Co., Inc. and Subsidiaries
Quarterly statements of income (Unaudited)
In thousands of dollars (except per share amounts)
Cost of sales and operating expenses, exclusive of depreciation
Selling, general and administrative expenses, exclusive of
Equity income in unconsolidated investees, net
Income from the operation of discontinued operations, net of tax
Gain on disposal of newspaper businesses, net of tax
Earnings from continuing operations per share - basic
Discontinued operations per share - basic
Gain on disposal of newspaper businesses per share - basic
Earnings from continuing operations per share - diluted
Discontinued operations per share - diluted
Gain on disposal of newspaper businesses per share - diluted
As a result of rounding and the required method of computing
shares in interim periods, the total of the quarterly earnings per
share amounts may not equal the earnings per share amount for the
year. In addition, the sum of the individual per share amounts in
each period may not equal the total per share amounts due to
Certain amounts differ from amounts previously reported on Form
10-Q due to the reclassification of equity income in
unconsolidated investees and due to the reclassification of
Results for the fourth quarter of 2007 include a pre-tax non-cash
intangible asset impairment charge of $72.0 million ($50.8 million
after tax or $0.22 per share). This charge did not affect the
company's operations or cash flow.