Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Gannett Joins the Slide

Count Gannett (NYSE: GCI  ) among those newspaper publishers increasingly drained by the drip, drip, drip of lower advertising revenues and reduced corporate earnings. While major publishers' declines are rarely substantial year over year, they've nonetheless become nearly universal in the industry -- at least for this particular quarter.

In the Q1 2007 results Gannett reported late last week, the company earned $210.6 million in net income, or $0.90 a share, compared with $235.3 million, or $0.99 per share, a year ago. The company, which publishes about 90 newspapers and operates just nearly two dozen television stations, essentially saw a dip in contributions from both segments (factoring out results from acquisitions made in the past year).

On the newspaper side, advertising revenues would have been almost 2% lower had the company owned the same properties in the first quarters of both 2006 and 2007. Classified revenues fell 3%, and national advertising revenues dropped by 4.8%. At USA TODAY, the company's largest newspaper, advertising revenues were off 7.9%.

In broadcasting, reported revenues increased slightly, but on a same-asset basis, those revenues fell 6.3%. Without the benefits of advertising related to either the Olympics or national political elections, broadcasting revenues decreased somewhat in the most recent quarter.

The trends at Gannett, as at Media General (NYSE: MEG  ) , New York Times (NYSE: NYT  ) , and Tribune (NYSE: TRB  ) , depict steadily softening advertising results. Of course, in the current climate, the soggy housing and real estate markets have made material contributions to falling ad sales.

But blaming the bursting of the years-long housing bubble for newspapers' atrophying condition seems like pointing the finger at a colder-than-normal winter to explain some retailers' softening same-store sales. There's some truth to the contention, but it's only part of the picture. It's more likely that the Internet has effectively stolen a considerable portion of both newspapers' and TV's audiences. Housing bubble or not, the Internet's "thievery" is a long-term phenomenon, and it's almost certain to accelerate.

For related Foolishness:

Fool contributor David Lee Smith does not own shares in any of the companies mentioned. He welcomes your questions and comments. New York Times is a former Motley Fool Income Investor pick. The Fool has a disclosure policy.

Read/Post Comments (0) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 526276, ~/Articles/ArticleHandler.aspx, 10/23/2016 12:40:20 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 day ago Sponsored by:
DOW 18,145.71 -16.64 -0.09%
S&P 500 2,141.16 -0.18 -0.01%
NASD 5,257.40 15.57 0.30%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/21/2016 4:03 PM
GCI $10.43 Up +0.07 +0.68%
Gannett CAPS Rating: *****
MEG $17.40 Down -0.05 -0.29%
Media General CAPS Rating: *
NYT $11.55 Down +0.00 +0.00%
The New York Times CAPS Rating: **