Gannett Results Rise on Political Spending
(Gannett earnings article updated with share price and trading volume information.)
MCLEAN, Va. (
) --
Gannett
(GCI) - Get Report
saw earnings rise during the third quarter, driven by strong gains in its broadcasting segment.
For the quarter ended Sept. 26, the
USA Today
publisher saw earnings rise 37.5% to $101.4 million, or 42 cents per diluted share, compared with earnings of $73.8 million, or 31 cents per diluted share, in the same period a year ago.
Gannet shares are down more than 8.5% to around $12.90 today after earnings came in below most analysts' expectations. Earnings from continuing operations in the third quarter were 43 cents per share, under analyst estimates of 50 cents. About 9 million shares have traded hands today compared to the stock's average 3-month volume of 4.1 million shares per day.
Revenue was essentially flat at $1.31 billion as gains in its broadcasting division offset the loss in its publishing segments.
"We closed the revenue gap this quarter with sequential improvement in publishing revenues as well as substantially higher broadcasting and digital revenues despite increased economic uncertainty," said chairman and CEO Craig Dubow.
Publishing revenues fell 4.8% in the third quarter to $969.4 million from $1 billion a year ago. Revenue from advertising declined 5.1% to $646.7 million, driven by a 3.2% drop in advertising revenues in the U.S. and a 7.1% decline at
Newsquest
in the U.K.
Broadcasting revenues were up 22.3% to $185.3 million compared to $151.5 million a year ago. The revenue increase is attributed to strong advertising gains and higher political spending.
"Reflecting our strong footprint and ratings, our television business achieved substantial revenue growth both in its core business and in political ad spending. Digital segment revenues were propelled by strong growth at PointRoll and CareerBuilder."
Political ad spending in the television segment totaled $36.3 million year-to-date. Management expects the strong political ad spending trend to carry over through the next quarter. Gannett projects "the percentage increase in television advertising revenues to be in the mid to high twenties for the fourth quarter of 2010 compared to the fourth quarter of 2009."
National advertising rose 1.9% in the quarter, driven by an increase in national advertising at
USA Today
. The publication had a total of 495 paid advertising pages compared with 493 in the third quarter last year.
Digital revenues in U.S. community publishing increased 10.2% in the third quarter attributed to gains in almost all of its advertising categories. Digital advertising at
USA Today
climbed 35.1% as a result of higher national advertising.
For the 9-months ended Sept 26, earnings jumped 86.8% to $414.1 million, or $1.72 per share, compared with earnings of $221.7 million, or 94 cents, in the same period a year ago.
Revenue fell 1.9% to $3.98 billion from $4.05 billion.
-- Written by Theresa McCabe in Boston.
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