Low ad rev and student sign-ups push Washington Post to loss
The company warned of a further drop in profit at its education unit and said it would incur costs as it undertakes restructuring of its biggest business, reeling under the impact of operational changes forced by new government rules.
Kaplan, which accounts for 60 percent of the company's revenue, posted its fourth straight quarterly decline in new student sign-ups as a result of stricter admission standards.
New enrollments fell 30 percent in July-September after Kaplan implemented a program that allowed students to take up a free trial of the degree program they want to enroll into, and decide after a few weeks whether they want to continue or not.
Even as the Post's newspaper division suffered due to dwindling ad sales, Kaplan reaped a profit as students went back to school amid a weak job market.
But a recent U.S. government scrutiny that unveiled unethical practices, low graduation rates and huge student debt loads at for-profit colleges has hurt enrollment.
AD SALES CONTINUE SLIDE
Things at its publishing business are not getting any better. Print advertising revenue fell 20 percent at the Washington Post.
The newspaper industry has been struggling to lift its ad revenue as other media, like broadcast, enjoy a rebound in marketing spending.
In October, Gannett Co, the largest U.S. newspaper chain by circulation, reported a severe decline in advertising revenue pointing to a pullback in consumer and business spending.
Washington Post's cable and broadcast units also saw revenue declines due to higher costs and lower ad sales.
The company's third-quarter net loss was $6.2 million, or 82 cents a share, compared with net income of $60.9 million, or $6.84 a share, a year ago.
Revenue fell 13 percent to $1.03 billion.
Results include impairment, restructuring and other charges. Excluding items, earnings were $4.95 a share.
(Reporting by A. Ananthalakshmi in Bangalore; Editing by Don Sebastian)