Business News
Newspaper Publisher A. H. Belo Corporation Reports Second Quarter 2009 Financial Results
Monday 27. July 2009 - Newspaper publisher A. H. Belo Corporation (NYSE:AHC) reported second quarter 2009 revenues of $127.5 million and a second quarter net loss of $7.1 million or $0.34 per share.
Second quarter results include $1.7 million or $0.10 per share for impairment of the customer value management system at The Dallas Morning News, which was offset by $1.1 million or $0.08 per share for insurance claim proceeds the Company received in the second quarter. The Company decommissioned the customer value management system as part of its ongoing cost reductions. Excluding these items, the second quarter net loss was $6.5 million or $0.32 per share.
A. H. Belo had $7.8 million in consolidated EBITDA and $13.1 million in newspaper EBITDA for the second quarter. The aggregate newspaper EBITDA margin was 10.3 percent. Excluding the insurance claim proceeds, consolidated EBITDA was $6.7 million. EBITDA margins in the second quarter were highest at The Providence Journal, followed by The Dallas Morning News.
The Company’s borrowings were $3.5 million as of June 30, 2009, down from $12.7 million at the end of the first quarter. A. H. Belo was in compliance with its bank covenants at the end of the second quarter.
Robert W. Decherd, chairman, president and Chief Executive Officer, said, “We successfully managed costs in the second quarter to remain EBITDA positive and significantly pay down the Company’s credit facility. A. H. Belo continues to experience success with our strategy of providing high quality newspaper subscribers to our advertisers, resulting in increased circulation revenue in 2009. In July, The Dallas Morning News went live with a new integrated advertising system. This new system provides tools that allow The Morning News sales force to spend more time with advertisers developing solutions that meet their advertising and marketing needs. With advertising revenues under pressure, it is critical that A. H. Belo’s sales force has the tools it needs to be successful.”
Second Quarter Highlights
Total revenue decreased 21.9 percent in the second quarter versus the prior year quarter.
Advertising revenue, including print and Internet revenue, was down 30.2 percent, due to declines in retail, general and classified revenues in all AHC markets. AHC’s Internet revenues accounted for 7.6 percent of total revenues in the quarter. Internet revenues were $9.8 million, 20.8 percent below the same period last year.
The Company continues to focus on editorial quality and value-added circulation for its advertisers. In the second quarter, circulation revenue rose 9.9 percent primarily due to increased prices for single copy and home delivery in Dallas and Providence.
Total consolidated operating expenses in the second quarter were $132 million, a 21.1 percent decrease from the same period last year. Excluding the effects of the insurance claim proceeds (which is a reduction to expense) and the non-cash impairment charge of $1.7 million, total consolidated operating expenses in the second quarter were $131.4 million, a 21.5 percent decrease from the same period last year. The decrease reflects reductions in almost all expense categories. Newsprint expense decreased approximately $5.9 million in the second quarter due to lower prices and volumes.
Corporate and non-operating expenses, net of costs allocated to operating units, declined by $5.8 million in the second quarter versus the prior year quarter, primarily due to reduced salaries and employee benefits.
Non-GAAP Financial Measures
Reconciliations of consolidated and newspaper EBITDA to net loss are included as exhibits to this release.