Business News

Morris Publishing Announces 2008 First-Quarter Results

Wednesday 14. May 2008 - Morris Publishing Group, LLC today reported first-quarter operating income of $7.6 million, down $3.0 million, or 28.3%, from $10.6 million for the same period in 2007.

Total operating revenue for the first quarter was $82.7 million, down $9.1 million, or 9.9%, from 2007. Total advertising revenue was $65.3 million, down $9.8 million, or 13.0%, with retail advertising revenue of $33.9 million, down 8.3%; classified advertising revenue of $26.4 million, down 19.0%; and national advertising revenue of $5.0 million, down 8.7%. Circulation revenue was $14.7 million, up $0.5 million, or 3.6%, from 2007.

For the first quarter, total operating cost was $75.1 million, down $6.1 million, or 7.5%, from 2007, with labor and employee benefits cost of $34.4 million, down $2.3 million, or 6.3%; newsprint, ink and supplement cost of $9.1 million, down $2.0 million, or 17.8%; depreciation and amortization expense of $3.5 million, down $1.3 million, or 25.6%; and other operating cost of $28.0 million, down $0.5 million, or 1.9%.

Commenting on the results, William S. Morris IV, Morris Publishing Group’s chief executive officer and president, said, “The real estate downturn in Florida and in many of our other markets, continues to have the greatest impact on our revenue results. We continue to closely monitor the market for signs of a cyclical recovery, but currently see a lot of downward pressure on a large segment of our advertising base.

“Our cost control efforts continue to help offset the revenue declines, with newsprint and employee costs being the major contributors.”

Interest and loan amortization expense totaled $8.0 million, down $1.3 million from $9.3 million last year primarily due the reduction in outstanding debt. At the end of the first quarter, the Company had $425 million in outstanding debt compared to $530 million at the end the same period last year.

During March, the Company repurchased $19.1 million of its $300 million 7% senior subordinated notes for a total purchase price of $10.7 million. Including the $8.4 million gain on these repurchases of debt, income from continuing operations before income taxes for the quarter was $8.2 million, up $6.9 million from $1.3 million in the prior year.

Net income was $5.6 million, up $4.8 million from last year.