The McClatchy Co. reported weaker fourth-quarter profit and revenue this morning, and the newspaper publisher warned that January brought bigger declines in advertising sales as the economic recovery remains shaky.
The Sacramento, Calif.-based publisher of The News & Observer, Charlotte Observer, Miami Herald and other newspapers across the country has been slashing costs to offset lower ad sales and to repay debt. McClatchy, like other media companies, was hit hard during the recession and is scrambling to beef up its online content as advertisers and readers migrate to the Internet.
For the final quarter of 2010, the company reported adjusted earnings from continuing operations of $33.6 million, or 39 cents per share. That was down from $49.6 million, or 59 cents a share, a year earlier.
Revenue fell 5.9 percent to $369.9 million.
But that rate of decline is much better than the double-digit drops McClatchy reported in recent years. While total ad revenue fell 6.9 percent during the fourth quarter, digital ad revenue increased 5.1 percent.
"Overall, we made good progress in 2010," said CEO Gary Pruitt, in a prepared statement. "We held costs down and saw advertising revenue trends improve."
Still, the company saw sharper ad declines in January, with total ad revenue down 10 percent.
"In response to this year's weak start, we have increased our ad sales efforts companywide and have initiated expense cuts at those newspapers that have seen the more significant ad revenue declines in December and January," Pruitt said.
That included eliminating 40 positions at the N&O and Charlotte Observer, including five newsroom jobs at each paper. Employees at both papers also are taking unpaid, week-long furloughs.
For the full year, McClatchy reported that revenue fell 6.5 percent to $1.4 billion. The company ended 2010 with $1.78 billion of debt, down $174 million from the year earlier.
McClatchy shares fell 61 cents today to close $4.38. The stock is now down about 6 percent so far this year.
Assistant Business Editor Alan M. Wolf joined the N&O in 1999 covering the business of health care. He became an editor in 2001, and helps oversee the paper's daily business coverage and Sunday Work&Money section. He lives in Clayton with his wife and two children. Reach him at 919-829-4572 or
Comments
Decline in McClatchey
Wed, 02/09/2011 - 09:15 — ProAmericaThe N&O's website is a good indication of the state of the newspaper. Duplication of stories (even on the same page!), old news mixed with today's news makes it hard to know what is news. The comments section is buried under layers of page clicks which makes it hard to access (and I"m sure people aren't bothering to read much either). And finally, whenever there is a stimulating topic for readers to comment on, the N&O often removes the ability to comment (most cases of illegal immigration for instance). The N&O is becoming irrelevant with the choices available for news these days. I'm trying to hold on, but the N&O keeps insulting my intelligence especially when they pass on 2nd hand stories from the NY Times and the wire service.
You have to read the paper carefully to disregard the liberal bias and political correctness which interferes with the reporting of the truth.
Thanks for the effort to
Tue, 02/08/2011 - 20:08 — BourbonStThanks for the effort to revive the News and Observer, McClatchy Group. You extended the N&O for at least ten years, and I believe you'd have been a resounding success if you'd kept the paper in the newspaper business and not tried going in a half-dozen different directions. Unless there's some stimulus money forthcoming soon, the area will be bidding you adieu.
McClatchy Reports
Tue, 02/08/2011 - 13:28 — henryeAs long as the masses listen to the electronic media.. nothing will change..Just a few short years ago. The dream was that this country would turn into an information center for the world...Unfortunately we under estimated the rest of the world.. after all it does not take a rocket scientist to electrify chips that can spit out information in seconds.so the tecnology sector is vulnerable world wide. and creating more smart phones that mostly sell in this country is not going to cure the ills.. I will say this that when you read an article it is much clearer to understand than verbal communication .which is why most smart people require written communation in business matters..
continue repeating oneself ....
Tue, 02/08/2011 - 11:40 — AgentPierceThe decline of traditional "newspapers" is certainly not a single source issue. The primary "cause" is radical technology innovations. That The N&O adds to that by further radicalizing its in-your-face-with-our-ideology campaign is "interesting".
Apparently the specific audience that the news/editorial departments embrace are not returning that embrace with subscriptions and advertising support. Liberals do enjoy spending "other peoples' money". Spending their own, not so much. ..... !!!
To quote the captain of The Titanic .... "Iceberg? What iceberg? Full speed ahead!"
No surprises here
Tue, 02/08/2011 - 10:48 — Notsurewhere_NCWhen your business model is manufacturing and recycling news eventually your readership and advertising clients slip away. Whether the N&O knows it or not these are what in business are referred to as customers. To simplify, Customers = Revenue. Catering to the fringe elements in what and how is reported and agenda sponsorship won't sustain revenue or grow the business. The N&O lost the mainstream audience years ago, and thus the death spiral continues.