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Daily Journal Corporation Announces Financial Results For The Six Months Ended March 31, 2013

LOS ANGELES, May 14, 2013 (GLOBE NEWSWIRE) -- During the six months ended March 31, 2013, consolidated pretax income of Daily Journal Corporation (Nasdaq:DJCO) decreased by $2,435,000 (45%) to $2,925,000 from $5,360,000 in the comparable prior year period.

The Company's traditional business segment pretax income decreased by $1,165,000 to $5,168,000 from $6,333,000 primarily because of a reduction in trustee sale notice and related service fee revenues of $1,778,000, partially offset by a reduction in operating costs and expenses of $759,000.

Sustain's and New Dawn's business segment had a pretax loss of $2,243,000 compared to $973,000 in the prior year period primarily due to (i) the addition of New Dawn's pretax loss of $356,000 and (ii) an increase in Sustain's personnel costs of $692,000 during the six months ended March 31, 2013.

Consolidated revenues were $17,446,000 and $15,986,000 for the six months ended March 31, 2013 and 2012, respectively. This increase of $1,460,000 was primarily from the additional New Dawn revenues of $3,690,000, partially offset by the reduction in trustee sale notice and related service fee revenues of $1,778,000. Although public notice advertising revenues were down compared to the prior year period, and although that trend is expected to continue, the Company still continued to benefit from the relatively large number of foreclosures in California and Arizona for which public notice advertising is required by law.

At March 31, 2013, the Company held marketable securities valued at $120,299,000, including unrealized gains of $70,605,000. It accrued a liability of $28,125,000 for income taxes due only upon the sales of the appreciated securities. The marketable securities consist of common stocks of three Fortune 200 companies, two foreign companies and certain bonds of a sixth, and most of the unrealized gains were in the common stocks.

Comprehensive income includes net income and net unrealized gains on investments, net of taxes. 
Comprehensive Income
   
  Six months ended March 31
  2013 2012
     
Net income $ 1,985,000 $ 3,750,000
Net change in unrealized appreciation of  investments (net of taxes)  10,915,000  16,840,000
Comprehensive income $12,900,000 $20,590,000

Consolidated net income was $1,985,000 and $3,750,000 for the six months ended March 31, 2013 and 2012, respectively. Net income per share decreased to $1.44 from $2.72. 
Financial Information for the Company's Reportable Segments
 
   Traditional business Sustain and  New Dawn* Total
Six months ended March 31, 2013      
Revenues $ 12,439,000  $ 5,007,000 $17,446,000
Pretax income (loss) 5,168,000  (2,243,000) 2,925,000
Income tax (expense) benefit  (1,660,000) 720,000  (940,000)
Net income (loss) 3,508,000  (1,523,000)  1,985,000
Amortization of intangible assets*   --  635,000  635,000
       
  Traditional business Sustain Total
Six months ended December 31, 2012      
Revenues $ 14,528,000  $ 1,458,000 $15,986,000
Pretax income (loss) 6,333,000  (973,000) 5,360,000
Income tax (expense) benefit  (2,235,000) 625,000  (1,610,000)
Net income (loss) 4,098,000  (348,000)  3,750,000

* Includes New Dawn's financial results from December 5, 2012 through March 31, 2013 with revenues of $3,690,000, expenses of $4,046,000 (including intangible amortization expenses of $635,000), and inter-company income tax benefits of $115,000.

Daily Journal Corporation publishes newspapers and web sites covering California and Arizona, as well as the California Lawyer magazine, and produces several specialized information services. Sustain Technologies, Inc. and New Dawn Technologies, Inc. are wholly-owned subsidiaries and supply case management software systems and related products to courts and other justice agencies. 

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