Market Punishes Washington Post (Update)

Updated from 11:03 a.m. EDT.

No quarter has been offered the teetering newspaper business of late, and first-quarter results from the Washington Post(WPO Quote) provided no indication that it will be given any time soon, as the company failed to meet Wall Street targets by a wide margin.

The news sent Washington Post stock sharply lower Friday. It closed at 365.88, down 52.71, or 13%.

The company, whose properties also include Newsweek and Kaplan, the educational services outfit, said it lost $19.2 million, or $2.04 per share, in the quarter. A year ago, it posted a profit of $38.8 million, or $4.08 per share.

Those results include a $13.4 million write-down in the value of the Washington Post newspaper itself, as well as $6.6 million to pay for the early retirements of employees at Newsweek. The company also took a $16.9 million charge for restructuring at Kaplan.

The company said that, on an EPS basis, those items totaled $2.45. Backing that number out of its bottom line, the company was in the black, with adjusted earnings of 41 cents a share in the quarter.

Still, that's a bad miss of Wall Street estimates. Analysts as polled by Thomson Reuters were looking for a first-quarter profit of $3.48.

In a pre-market press release, the company said first-quarter revenue fell 1% to $1.05 billion from $1.06 billion. For the disappointing results, the company cited the by now familiar media-company woes: declining ad sales across its print and television businesses.

Newspaper revenue alone tumbled 22% from the year-ago quarter, while print advertising at the Post fell 33%. The company said it will likely write down the value of the newspaper by another $18.5 million over the course of the year as it closes printing presses and consolidates other operations.