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New York Times quarterly profit, revenue rise
NEW YORK |
NEW YORK (Reuters) - The New York Times Co (NYT.N) reported a 6.7 percent rise in profit on Tuesday because of higher national advertising sales and a price increase for its flagship newspaper, sending its shares up as much as 8 percent.
The better-than-expected results were in sharp contrast to downbeat earnings results from most U.S. newspaper publishers.
Third-quarter net income rose to $13.44 million from $12.6 million in the third quarter a year ago. Earnings per share were flat at 9 cents.
Earnings from continuing operations were 10 cents a share, compared with 6 cents a share in the third quarter last year.
The results beat the average analyst expectation of 5 cents a share, according to Reuters Estimates.
"The New York Times blew the top off," said Benchmark Co analyst Ed Atorino. "<It was> just a very impressive performance by The New York Times Company in the midst of a disastrous industry performance. I have a hold on it, but I have to take a hard look at that stock today."
Times shares, which have fallen by nearly 20 percent since last year, were up $1.14 at $19.55 after hitting $19.92 earlier on the New York Stock Exchange.
Excluding special items, the Times earned 15 cents a share during the quarter, compared with 9 cents in the third quarter a year ago.
Items included accelerated depreciation expense of 5 cents a share related to the sale of its Edison, New Jersey, printing plant.
Revenue at the Times, which also publishes the Boston Globe and several smaller daily newspapers throughout the United States, rose 2 percent to $754.4 million. Analysts, on average, had forecast revenue of $734 million.
The results buck last week's nearly uniform drop in advertising revenue by heavyweight publishers like Gannett Co Inc (GCI.N) and McClatchy Co (MNI.N). Other newspaper owners, including Tribune Co TRB.N, Belo Corp (BLC.N) and EW Scripps Co (SSP.N), will likely log poor ad sales as well, analysts and industry experts said.
The New York Times Co cautioned that it is does not know how the fourth quarter will shape up. The company reported strong performance in September, but added that October has not been as robust.
September advertising revenue rose 5.5 percent, while the news media group's ad sales jumped 18.9 percent on strong national advertising sales growth.
Classified real estate ad sales fell 14.8 percent in September, however, reflecting a broader industry trend.
Third-quarter national advertising rose 10.9 percent, while circulation revenue rose 3.9 percent.
The company's online division reported that revenue rose 26.5 percent to $79.7 million. Internet operations accounted for 10.6 percent of the company's revenue, up from 8.5 percent a year ago. That includes the About.com online search and question-and-answer Web site and various news Web sites.
Total ad revenue fell 0.1 percent, with news media group revenue down 1.4 percent because of advertising weakness at its New England group, which includes the Globe, and the regional media group.
The company's circulation revenue rise was due to price increases for newsstand copies of The New York Times newspaper.
Wall Street is waiting to see what large shareholders do with their stakes in the Times after one of its top shareholders, Morgan Stanley Investment Management, sold its 7.2 percent stake last week.
Fund manager Hassan Elmasry sold the shares after giving up a two-year battle to get equal rights for all shareholders and change the company's governance structure after complaining about what he said were poor decisions on the part of the company's management.
The stock hit its year low on Monday at $18.05. Its year high came last February when it reached $26.90.
(Editing by Brian Moss)
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