Gannett Beats Street, Posts First Revenue Jump Since 2006
Gannett (NYSE:GCI) reported a 12% drop in fourth-quarter earnings, as higher revenue was outweighed by increased charges related to restructuring.
Growth from the USA Today publisher’s digital subscriptions, as well as strong political advertising at its broadcasting assets, drove revenue gains.
Profit for McLean, Va.-based Gannett was $103.1 million, or 44 cents a share, down from $116.9 million and 49 cents a share one year ago. Adjusted per-share earnings, which exclude the restructuring-related charges, rose to 89 cents from 72 cents. Analysts were looking for earnings of 88 cents a share.
Revenue jumped to $1.52 billion, a 9.4% gain. Gannett had projected fourth-quarter per-share earnings of 87 cents to 88 cents and revenue growth of 5%.
“We are proud of our strong operating results this quarter with growth in revenue and margin expansion driving strong cash flow,” Gracia Martore, president and chief executive of Gannett, said in a statement. “This caps an extremely productive year in which we successfully implemented our strategy to position Gannett for success in the digital era. For the year, we achieved our first year-over-year increase in company-wide revenue since 2006.”
Dwindling print advertising revenue has put pressure on newspaper publishers like Gannett, which is the largest U.S. publisher by circulation. Gannett’s print ad revenue declined 2% in the latest period, but dropped 6.5% when disregarding an extra week of sales compared to the year-ago quarter.
The company has focused its investments on digital operations, rolling out digital subscription programs at its roughly 80 local newspapers. Local circulation revenue was up 24% in the fourth quarter, while overall publishing circulation revenue climbed 17%. Total revenue for the community publishing division was up 3.7%.
Digital revenue across the entire company posted a 29% gain, and revenue at Gannett’s digital segment grew 3.2% on strong performance at CareerBuilder.
Political ads fueled Gannett’s television revenue growth of 46%.
Shares of Gannett were down 64 cents, or 3.23%, to $19.20 shortly after Monday's opening bell.