Media Company Financials Getting Ugly

[Teddyo]

:'(

Hope you don't own any Gannett or EW Scripps stock! Ouch!

Both companies released 2nd quarter earnings the past 2 weeks and it wasn't pretty. Locally Gannett, of course, is the owner of the AZ Repulsive/AZcentral/KPNX and EW Scripps is the owner of KNXV, ABC-15.

Gannett's 2nd Q profit fell 36% compared to last year, and their stock has dropped by 50% since the beginning of the year. EW Scripps saw an even bigger decline -- a 50% drop in profit from last year and their stock (post split) is now at 7 1/2, a 35% drop since July 1. It dropped by 13 % just on Friday when EW Scripps' management told analysts that they would not meet their 3rd Q targets and will likely cut their dividend significantly.

All this comes after Scripps' July 1 split of the more profitable cable and internet operations of the company from the hurting newspaper and broadcast TV operations engineered by CEO Lowe (who stayed on as head of the new interactive company, natch) . Scripps newspapers and TV stations are on their own now after this financial, and the company may soon be trading at penny stock levels.

It'll be interesting to see how this crumbling of old media firms continues to play out, locally and across the nation. The NY Times is hurting big time too.

 

[DrAkbar]

EW Scripps saw an even bigger decline -- a 50% drop in profit from last year and their stock (post split) is now at 7 1/2, a 35% drop since July 1. It dropped by 13 % just on Friday when EW Scripps' management told analysts that they would not meet their 3rd Q targets and will likely cut their dividend significantly.

All this comes after Scripps' July 1 split of the more profitable cable and internet operations of the company from the hurting newspaper and broadcast TV operations engineered by CEO Lowe (who stayed on as head of the new interactive company, natch) . Scripps newspapers and TV stations are on their own now after this financial, and the company may soon be trading at penny stock levels.

Scripps saw the writing on the wall and wisely split the companies into old tech and new tech. Don't pay much attention to SSP's (old tech) stock price or dividend. Wall St still hasn't got a handle on how to value this company and the current 20+% dividend is a holdover from the pre-split days. Most shareholders of SSP got theirs from the old combined company (pre-split) and don't know whether to hold or fold. SNI (new tech) is a whole lot sexier, even though it doesn't pay a dividend. Nurse Jeff and I think Scripps' mgnt has a better handle on media than McPaper's.

 

[Teddyo]

To add some good news for the media companies --

News Corp (Fox) beat Wall Street estimates and posted a 27% increase in profit for the 2nd Q. Some of it was attributable to sale of assets but a good portion was also from their newspaper units! Of course Dow Jones is now part of the News Corp family.

This was an interesting comment in the AP story which runs counter to the situations at most diversified media firms:

Revenue rose 17 percent to $8.59 billion from $7.37 billion last year, and was higher than the $8.15 billion Wall Street expected. Strong gains in film, newspapers and cable were partially offset by declines at its television and interactive units.

 

[desertskies]

Any word on Meredith?
Jimmy thinks that the shops on BC Hwy and in Atlanta, Portland and KC would be pretty well protected.

Flint/Saginaw and Springfield, the first to go?

 

[Teddyo]

Any word on Meredith?
Jimmy thinks that the shops on BC Hwy and in Atlanta, Portland and KC would be pretty well protected.

Flint/Saginaw and Springfield, the first to go?

Don't know about the details but Meredith was also down 10% in revenue and net was down 63% due to lower advertising revenue.
For the three months ended June 30, net income fell to $19.2 million, or 41 cents per share, from $51.5 million, or $1.05 per share, in the same period last year. I don't know what the breakdown was between broadcast TV, magazines, etc.

Pretty much the same bleak financial picture as at Gannett and Scripps. News Corps is the positive aberration.

No doubt significant cost-cutting is ahead for Meredith.

 

[desertskies]

Any word on Meredith?
Jimmy thinks that the shops on BC Hwy and in Atlanta, Portland and KC would be pretty well protected.

Flint/Saginaw and Springfield, the first to go?

Don't know about the details but Meredith was also down 10% in revenue and net was down 63% due to lower advertising revenue.
For the three months ended June 30, net income fell to $19.2 million, or 41 cents per share, from $51.5 million, or $1.05 per share, in the same period last year. I don't know what the breakdown was between broadcast TV, magazines, etc.

Pretty much the same bleak financial picture as at Gannett and Scripps. News Corps is the positive aberration.

No doubt significant cost-cutting is ahead for Meredith.

Thanks Teddyo