Total revenue for Lee Enterprises, Incorporated (NYSE: LEE), declined 9.2 percent in January compared with a year ago, the first single-digit decline since 2008, as the year-over-year trend in advertising revenue improved for the fifth month in a row.
In remarks prepared for Lee’s annual meeting of stockholders, Carl Schmidt, vice president, chief financial officer and treasurer, said the improvement appears to be continuing into February and March.
He said total advertising revenue in January declined 10.5 percent compared with a year ago. Combined print and online retail advertising decreased 10.5 percent, while classified decreased 12.1 percent, with employment down 25.1 percent, auto down 11.7 percent, real estate down 19.2 percent, and other classified categories up 2.1 percent. Online advertising revenue increased 5.7 percent.
For the quarter ended Dec. 27, 2009, advertising revenue declined 16.4 percent and total revenue declined 13.8 percent.Schmidt said cash costs are expected to decrease 9 percent for the March 2010 quarter and 8 percent, or $54 million, for the year. Previous guidance was for a decrease of 7 percent for both periods. He said debt reduction for the 12 months ended December 2009 totaled $198 million, of which $78 million was from cash generated by operations, with the remainder coming from utilization of $120 million of previously restricted funds. “We are operating well within the commitments we made to our lenders when we completed a comprehensive refinancing of our debt a year ago, and we expect to continue repaying debt primarily with our ongoing cash flow,” he said. Mary Junck, chairman and chief executive officer, shared updated market studies showing that Lee’s newspapers and online sites continue to reach up to three-fourths of adults over a week, including 59 percent of people 18-29. “In a time of rapidly evolving digital interactivity, our newspapers and online sites remain in front, by far, surpassing all print, broadcast and online competitors as the primary source for local news, information and advertising in our communities,” she said, adding: “Without us, most local news would never come to light.”