Meredith Registers Magazine, TV Rise

Stephen Lacy

One of the first magazine publishers to be hit by the recession appears to be leading the tentative rebound, with women's interest publisher Meredith Corp.'s announcement of positive revenue growth in the second quarter of 2010.

While other big consumer magazine publishers have yet to announce their results, the Meredith news holds out hope that this beleaguered print medium may be emerging from one of the worst advertising downturns in its history.

"Fiscal 2010 marked a return to earnings growth as we strengthened our business across the board," said Meredith chairman and CEO Stephen M. Lacy. "We increased advertising market share in both magazine and television."

Meredith's second-quarter revenues increased 6% from $344 million in 2009 to $365 million in 2010, due largely to a 7% increase in advertising revenues, from $188.8 million to $202 million in the same period.

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Focusing on its specific divisions, the national media group (the company's new designation for magazine publishing, plus interactive and marketing services operations) saw total revenues increase 2% to $288 million -- partly due to a 1% increase in ad revenues to $135 million. The division's operating profit was flat at $46 million. The company carries about $300 million in debt, down from $380 million at this time last year.

The local media group (the new designation for Meredith's broadcast TV properties) enjoyed an even bigger boost, with total revenues increasing 23% from $62.6 million to $77 million. The division swung from a loss last year to operating profit of $21 million this year.

Looking to the future, Meredith executives were cautiously optimistic about the prospects for a sustained recovery in magazine ad spending, noting that the industry in general faces a "volatile advertising environment," given continuing economic uncertainty.

It is forecasting $25 million to $30 million of net political advertising revenues at its television stations from high-profile midterm elections. Meredith expects a total ad revenues across all platforms to increase about 6% to 7% compared to last year.

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