Earnings: 3Q05 Looks Are Deceiving For Knight Ridder


Updated to include conference call: Looking only at earnings per share, Knight Ridder would seem to have a pretty good 3Q05 with earnings of $3.56 per share, up 259 percent over the same time last year. But the bulk of that number comes from gains on the sale of the Detroit Free Press, Knight Ridder’s share in the Detroit newspapers and the Tallahassee Democrat. Otherwise, as Chairman and CEO Tony Ridder says, the “fundamentals” were “disappointing.” Without the frills, KR’s operating revenue would have been up 1.1 percent and costs — sans severance — up 5.5 percent. Ridder said the cost increase wouldn’t be repeated in 4Q05.
The digital operations continue to be the company’s best story with ad revenue (excluding new acquisitions) up 51.8 percent for the quarter and 53.6 percent through the first three quarters.
During the earnings call with analysts, KR SVP Hilary Schneider provided a few details: “The increase in revenue was driven by strong growth across all key revenue categories. Recruitment, our largest revenue category, was particularly strong.” She said it was up $22 million in the third quarter, a 70-percent increase over the same quarter last year. CareerBuilder was equally strong, with $133.2 million revenue in 3Q05, an increase of 72 percent over 3Q04 with traffic up 20 percent.

Earnings release | Webcast

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