Business News
Morris Publishing Announces 2008 Second-Quarter Results
Thursday 14. August 2008 - Morris Publishing Group, LLC today reported second-quarter operating income of $8.6 million, down $7.5 million, or 46.8%, from $16.2 million for the same period in 2007. Total operating revenue was $82.2 million, down $13.4 million, or 14.0%, and total operating cost was $73.6 million, down $5.9 million, or 7.4%
Total advertising revenue was $65.2 million, down $13.5 million, or 17.2%, with retail down 12.4%; classified down 24.6%; and national down 4.4%. Circulation revenue was $14.8 million, up $0.4 million, or 2.9%, from 2007, due to home delivery price increases and a change in the way we sell home delivery subscriptions in Florida. Other income was $2.2 million, down $0.3 million, or 11.4%.
For the second quarter, labor and employee benefits costs were $33.6 million, down $3.3 million, or 9.1%; newsprint, ink and supplement cost was $9.7 million, down $0.3 million, or 3.0%; depreciation and amortization expense was $ 3.5 million, down $0.9 million, or 19.8%; and other operating costs were $26.8 million, down $1.4 million, or 4.8%.
Interest and loan amortization expense totaled $6.9 million, down $2.6 million from $9.4 million last year. At the end of the second quarter, the Company had $417.1 million in outstanding debt compared to $522.0 million at the end of the same period last year.
Income from continuing operations was $2.0 million, down $2.0 million from $4.0 million during the second quarter last year. Income from discontinued operations was $0.9 million during the second quarter last year.
Commenting on the results, William S. Morris IV, Morris Publishing Group’s chief executive officer and president, said, “Our advertising revenue results continued to be affected by the weak economy and the secular trends impacting our industry.
“During the quarter, our print advertising revenue was down 19.6%, with declines in all categories. Online advertising revenue was up 2.2%, compared to a 20.9% increase last year. Excluding the employment online category, our online advertising revenue was up 13.7%.
“Our cost structure benefited from a 9% reduction in head count, with salaries and wages down $2.0 million, or 7.6%. In addition, our second largest expense category, newsprint, was up slightly, with a 27.6% increase in the average cost per ton being offset by reduced consumption.”
For the first six months, operating income was $16.2 million, down $10.6 million, or 39.4%, from $26.8 million in 2007. Total operating revenue was $164.9 million, down $22.6 million, or 12.0%, and total operating cost was $148.7 million, down $11.9 million, or 7.4%.
Advertising revenue was $130.5 million, down $23.3 million, or 15.1%, with retail down 10.4%; classified down 21.8%; and national down 6.8%. Circulation revenue was $29.5 million, up $0.9 million, or 3.2%.
For the first six months, labor and employee benefits costs were $68.0 million, down $5.7 million, or 7.7%; newsprint, ink and supplement cost was $18.8 million, down $2.3 million, or 10.8%; depreciation and amortization expense was $7.0 million, down $2.1 million, or 22.8%; and other operating costs were $54.9 million, down $1.9 million, or 3.4%.
Interest and loan amortization expense totaled $14.9 million, down $3.9 million from the first six months last year.
Including the $9.3 million in pre-tax gain on the repurchases of $21.5 million in senior subordinated debt, income from continuing operations for the first six months was $7.6 million, up $2.9 million from $4.8 million last year. Income from discontinued operations was $1.0 million during the first six months last year.