Washington Post Profits Slump
Declines at its newspaper businesses continued to weigh on
Washington Post Co.
(WPO)
in the third quarter.
The publishing conglomerate and education company reported a drop in third-quarter profits to $72.2 million, or $7.60 a share, from $73.1 million, or $7.60 a share, in the same quarter last year.
The per-share results were boosted by a drop in shares outstanding stemming from the company's recent $42 million buyback.
The bottom line included a one-time gain of $5.9 million, or 62 cents a share, on the sale of property at a TV station in Miami. Excluding that item, Washington Post still beat analysts' average estimate for earnings of $6.63 a share, according to Thomson First Call.
On its top line, the company met Wall Street's expectations with an 8% increase in revenue to $1.02 billion, powered by growth at its education and cable businesses.
But Washington Post's newspaper publishing unit continued to struggle amid an industry-wide slump. Its quarterly revenue fell 7% to $210.2 million. Profits dropped nearly 50% to $8.8 million from $17.7 million.
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Print advertising revenue at the company's flagship newspaper,
The Washington Post
, fell 13% to $113.1 million. Circulation slid 4% from a year earlier.
Revenue at its magazine publishing division, which includes
Newsweek
, fell 18% to $62.5 million. Operating income rose slightly to $7 million.
Television broadcasting revenue was down 5% to $77.8 million for the quarter, though operating income rose 10% to $36 million thanks to the Miami sale.
The company's cable business provided a tailwind, with an 11% revenue gain to $157.8 million and a 6.8% advance in operating profit at $29.8 million.
Washington Post's Kaplan education business, which now accounts for roughly half of the company's top line, recorded a 22% revenue jump. Almost half of that gain came from acquisitions. The division's operating profit fell 2% to $37.6 million.
Shares of Washington Post recently were down $26.20, or 3.1%, to $822.80.
