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Washington Post Falls Short

The publisher misses targets.

Washington Post


reported a 10% earnings jump, as strength at its education and cable businesses wasn't enough to bring the newspaper publisher's results in line with Wall Street's expectations.

The media conglomerate and owner of educational services provider Kaplan said it earned $73.1 million, or $7.60 a share, up from the $66.3 million, or $6.89 a share, it recorded in the same period last year.

The results include a gain of $2.8 million, or 29 cents a share, related to the sale of property and marketable securities. They also reflect a charge of $6.3 million, or 65 cents a share, for a goodwill impairment charge at PostNewsweek Tech Media, which is part of the company's magazine publishing segment.

After special charges, Washington Post's results fell short of analysts' estimates, which called for earnings of $8.62 a share, according to consensus estimates reported by Thomson First Call.

The top line also disappointed, with total revenue for the quarter amounting to $946.9 million, up 8% from last year's results. Analysts had expected revenue of $963.5 million.

The weakness came from Washington Post's publishing business, as circulation and advertising revenue for its newspaper and magazine units continued to decline. Revenue from its newspaper business fell 4% to $225.6 million for the quarter, while its operating income was down 38% to $17.7 million.

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Those declines mainly reflects a decline in print advertising revenue at

The Washington Post

newspaper and increased pension expense. Print advertising revenue at the company's namesake paper was down 11% to $129.4 million for the quarter.

Revenue from its magazine unit, which publishes


, was down 3% to $76.1 million.

Meanwhile, its television broadcasting division posted an 11% increase in revenue to $82.2 million, boosted by political advertising in a hotly contested, midterm election season.

Its cable division also posted a revenue jump of 16% to $142.3 million for the quarter, and its for-profit education business, Kaplan, also lent strength with a 16% revenue gain to $420.6 million. The education business has become a formidable growth engine for the company, and last year it became its most profitable business. Its operating income increased 21% to $38.4 million.

Shares of Washington Post, which are heavily owned by the city's Graham family, were recently trading up 70 cents at $738.50.