Gannett Profits Rise As Revs Dip; Digital Revenues Rise


As it has for the last four quarters, Gannett’s profits rose thanks mostly to revenues from its local TV stations and continued cost cutting at its newspapers. Meanwhile, slight improvement at CareerBuilder, which had been a drag on digital revenues for over a year, pushed Gannett’s interactive segment up 8.3 percent. Company-wide digital revenues, which include the Digital Segment and all interactive revenues generated by the other business units, were $252.2 million — 9.7 percent higher in Q2 compared to the second quarter in 2009 and were almost 19 percent of total operating revenues.

Updated: Just after Gannett (NYSE: GCI) announced its Q2 earnings, it released details of its local ad partnership with Yahoo (NSDQ: YHOO). The partnership will cover a portion of display inventory at Gannett’s 81 U.S. community papers as well as the company’s local broadcasters’ websites. (Our coverage of the earnings call.)

More on digital, plus the highlights on how other Gannett units performed in Q2:

Digital: In addition to CareerBuilder, Gannett’s digital holdings include rich media provider PointRoll, ShopLocal, Planet Discover, Schedule Star and Ripple6, which was folded into Pointroll in May. During the morning earnings call, Gannett is expected to discuss some other digital moves, such as naming a successor to Chris Saridakis, who left as chief digital officer in April to become CEO of GSI Commerce’s Marketing Services unit. During the Q1 earnings call, CEO Craig Dubow said the company planned to have a subscription plan in place for its USAT iPad app by July 5th, but the company backed off after finding that advertising sales on the app were sold out. Dubow is expected to provide an update on those plans on this morning’s call.

Publishing: Gannett posted some pretty good numbers here, though it helps to keep in mind that it’s coming off the worst year for advertising since the Great Depression. With that context out of the way, operating income at the publishing unit, which includes the community papers and Gannett flagship USA Today, was up 20.8 percent over Q209. That was due to slowing revenue declines as well as $20 million in savings from mandatory, unpaid leave that staffers took in the quarter. Publishing revenues declined 6 percent and classifieds fell only 5 percent, which is a major improvement over the nearly 45 percent decline for that section last year.

USAT: The softness in the travel industry continues to plague USAT. While automotive, retail and packaged goods categories increased spending on the newspaper in Q2, it wasn’t able to balance out travel. Paid ad pages in USAT totaled 580 compared with 602 in last year

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