As the owner of my beloved Chicago Cubs, I'm willing to give TribuneCo. (NYSE:TRB) the benefit of the doubt with respect to recent well-publicized circulation miscues. I believe that management has taken concrete steps to address and correct the situation, but now that the company has played its "get out of jail free" card, it can be afforded no leniency for yesterday's truly lackluster second-quarter report card.

Last month Tribune revealed that circulation numbers for its Newsday and Spanish-language Hoy publications had been overstated by as much as 15% and more recently disclosed that internal reviews have uncovered additional misstatements at the same two papers. Given advertisers' reliance on the accuracy of circulation figures, Tribune's costly errors have undermined the faith of both its core customer base and the investing public. Shares of the company have been reeling, falling yesterday to a new 52-week low of $42.

Second-quarter earnings released after the bell did little to assuage the pessimism; if anything, they underscored the depth of the problem. Net income dove 58% lower to $96.4 million ($0.29) from $229.5 million the year before amid a series of charges, including $17 million for scaling back the workforce and $35 million set aside to soothe the concerns of angry advertisers. The company also recorded a non-operating after-tax loss of $80 million, primarily for the early retirement of debt. Excluding these one-time items, earnings would have been roughly in line with estimates.

Publishing revenues, which represent more than two-thirds of Tribune's business, only managed a slight 3% bounce despite a vastly improved economic and employment picture. National advertising revenues and classified revenues grew 2% and 6% respectively. Meanwhile, rival Gannett (NYSE:GCI) posted corresponding increases of 10.4% and 12.2%. Tribune's 26 television stations delivered a meager 4% gain in ad revenues, compared with advances of 10.3% at Gannett, 10.7% at the New York Times (NYSE:NYT), and 11% at E.W. Scripps (NYSE:SSP).

Certainly, Tribune's mounting legal problems present a formidable short-term obstacle. At best the company will be forced to pay for its oversight via cash or free advertising and hope advertiser loyalty limits defections. Continued weakness at The Los Angeles Times remains another concern. However, those of the opinion that Tribune's tepid quarter and circulation woes are minor setbacks for an otherwise solid business may find this an opportune time to pick up shares.

Tribune owns a portfolio of valuable assets outside of print publications, including 26 television stations, the aforementioned Cubs franchise, and various websites such as the fast-growing, which is jointly owned with Gannett and Knight Ridder (NYSE:KRI). If the company can sidestep the circulation problems, get back on track, and continue to generate upwards of $1 billion in annual free cash flows, then all this recent softness might quickly become old news.

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Fool contributor Nathan Slaughter owns none of the companies mentioned.