New Media Bolsters Dow Jones

Fourth-quarter revenue rises 10.3%, the media company says.
Author:
Publish date:

Dow Jones & Co.

(DJ)

said fourth-quarter revenue rose 10.3% thanks to the acquisition of

MarketWatch

, growth at its electronic-publishing segment and the rollout of a weekend edition of

The Wall Street Journal

.

The New York-based media titan earned $41.2 million, or 49 cents a share, in the quarter, compared with $35.6 million, or 43 cents a share, in the 2004 period. Excluding items, Dow Jones earned 41 cents in the most recent quarter, topping analysts' consensus target by a penny.

The items include a tax-related gain of 11 cents a share, a charge of 2 cents a share associated with an equity investment and a charge of 1 cent a share for a reserve for its former Telerate unit.

Revenue for the quarter totaled $482.2 million, up from $437.2 million a year earlier. Electronic-publishing revenue of $134.2 million surged 32.9% from last year. The increase reflects the purchase of MarketWatch, a competitor of

TheStreet.com Inc.

(TSCM)

, the publisher of this Web site.

Advertising linage at the U.S. editions of the

Journal

, a publication that started its life as the "Customers' Afternoon Letter," increased 8.1% in the quarter, including a 17% jump in December.

For the first quarter, Dow Jones, which traces its roots to 1882 when Henry Dow, Edward Jones and Charles Bergstresser started a small operation on Wall Street, is projecting that its earnings before items will be in the "low-teen cents per share range." The company had a profit of 11 cents in the same quarter the previous year.

Analysts surveyed by Thomson First Call are looking for a profit of 14 cents in the quarter.

The company expects total linage at the U.S.

Journal

to rise in the "mid-single-digits percentage range" compared with the first quarter of 2005. The forecast includes the paper's weekend edition.

Earnings for all of last year dropped to 73 cents a share from $1.21 in 2004.

Shares of Dow Jones were rising $1.06, or 2.8%, to $39.

"While full-year 2005 profits were adversely affected by a continued difficult environment for print advertising, we made major investments to strengthen our portfolio," said Peter Kann, Dow Jones' chairman and outgoing chief executive. "These investments include the acquisition of MarketWatch, launch of Weekend Edition, repositioning of the

Journal's

international editions, Ottaway Internet and infrastructure initiatives, and the announced redesign of the U.S.

Journal

. These investments set the stage for future profitable growth."

Kann will vacate the CEO post in favor of Chief Operating Officer Richard Zannino on Feb. 1. Kann will continue as chairman until the 2007 annual meeting, when he reaches the company's mandatory retirement age of 65.

Dow Jones also publishes

Barron's

. Additionally, the company's name is prominently placed in a well-known stock index that tracks the performance of 30 large corporations.