February 8, 2011 / 4:08 PM / 7 years ago

UPDATE 2-McClatchy Q4 rev falls; to cut costs in 2011

* Q4 adj EPS $0.39 vs est $0.35

* Says California, Florida regions were weak

* Sees 2011 capex spending lesser than $20 mln

* Shares fall 13 pct

(Recasts, adds conference call details; updates share movement)

Feb 8 (Reuters) - News and advertising firm McClatchy Co MNI.N said it would substantially cut costs this year as advertising revenue continued to be hurt by a weak economy, dragging fourth-quarter sales down 6 percent.

Shares of the company, which publishes The Miami Herald and the Sacramento Bee, fell 13 percent in morning trade.

Advertising revenue was down 6.3 percent in October-December, hurt by a 10.6 percent fall in national advertising sales. [ID:nASA01IUC]

Chief Executive Gary Pruitt blamed a downturn in the real estate markets of California and Florida along with sectoral weakness for the fall in ad revenue.

McClatchy, whose $1.78 billion debt has worried investors, said it paid back a bank term loan 18 months early, and was focusing on cutting costs and increasing ad revenue.

“We expect that we will spend no more than $20 million on Capital expenditures in 2011,” Pruitt said.

Rival broadcaster and publisher Media General Inc MEG.N also reported a lower quarterly profit as publishing and advertising revenues slid. [ID:nSGE70Q0DM]

Shares of Sacramento, California-based McClatchy, which have risen over 50 percent in the last three months, were down 10 percent at $4.50 on Tuesday on the New York Stock Exchange. (Reporting by Siddharth Cavale and Supantha Mukherjee in Bangalore; Editing by Joyjeet Das)

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