New York Times Withdraws Plans for Internet Tracking Stock

The New York Times Co. (NYT Quote) announced Thursday that it was withdrawing its plans for an initial public offering of a tracking stock that would reflect the performance of its Internet division because of unfavorable conditions in the stock market.

The company, which publishes among other things The New York Times, The Boston Globe and 16 other newspapers, also reported a slight increase in its third-quarter earnings, meeting Wall Street's forecasts.

The Times Co. said its decision to withdraw the stock offering's registration statement with the Securities and Exchange Commission would have no impact on the daily operations of New York Times Digital, the Internet division, or the unit's expansion plans.

"It's quite evident that today's market is bearish on Internet companies, regardless of how well they are performing,'' Martin Nisenholtz, chief executive of New York Times Digital, said in a statement. "If we proceeded with the offering now, we would not receive the valuation we deserve."

Nisenholtz added, "We look forward to proceeding with a public offering when the market improves.''

Arthur O. Sulzberger Jr., chairman of the Times Co., said in a statement that the company remained committed to building its Internet business, calling it "a significant part of our company's growth strategy."

The Internet division is comprised of such Web sites as NYTimes.com, Boston.com, WineToday.com, newyorktoday.com, GolfDigest.com and Abuzz, an online knowledge-sharing network.

The company filed the registration statement for the initial public offering on Jan. 28.

The Times Co. said revenue at New York Times Digital rose 97.8% in the third quarter, to $12.1 million from $6.1 million a year earlier.

The Times Co. also reported that its overall earnings excluding one-time items rose to 37 cents a share in the third quarter from 36 cents a share in the comparable quarter of 1999. The results in the latest quarter matched the consensus estimates of analysts surveyed by the Wall Street research firm First Call/Thomson Financial.

The company attributed the higher earnings to gains in newspaper advertising revenue, which helped offset higher newsprint prices and larger investments in New York Times Digital.

The Times Co. also said its earnings excluding one-time items should reach $2.05 a share to $2.10 a share for the entire year, compared with $1.78 a share in 1999.

Including one-time items, the Times Co. reported net income of $75 million, or 44 cents a share, in the third quarter, an increase of 24.9% from net income of $60 million, or 34 cents a share, in the comparable quarter of 1999.

The one-time items in the latest quarter included a $22.2 million pretax gain from the sale of four newspapers and nine telephone directories in the company's regional newspaper group.

The Times Co.'s revenue rose 7.9%, to $787.3 million, in the third quarter, from $729.7 million a year earlier.

Shares of the Times Co. were trading down $1, or 3%, at $35.13 around midday Thursday on the New York Stock Exchange after hitting a 52-week low of $34.63.

The Times Co. owns a 5.8% stake in TheStreet.com.