Gannett Newspaper Revs Up, McClatchy Down

Newspaper advertising revenues continued to decline in the first quarter of the year, with two big publishers, Gannett and McClatchy, announcing declines due to print advertising losses. However, Gannett’s total revenues increased as a result of strong results from its broadcast operations, while McClatchy’s losses were offset somewhat by gains in digital ad revenues.
 
Revenues at Gannett’s publishing division fell 3.3% from $871 million in the first quarter of 2013 to $842 million in the first quarter of 2014, largely as a result of a 4.8% drop in advertising revenues, from $527 million to $501 million. Circulation revenues fell 1.4% to $282 million, but digital revenues increased 7.6%.
 
In terms of specific ad categories, retail fell 7.1%, national slipped 1.5%, and classifieds were down 5.9%; within classifieds, automotive was down 1.5%, employment 8.4% and real estate 3.3%.
 
Positive results from Gannett’s broadcast division buoyed the company to revenue growth. Excluding the impact of new broadcast TV stations acquired with the purchase of Belo Corp. in the second half of 2013, broadcast revenues jumped 20% to $382 million, reflecting increased advertising spending associated with the Sochi Winter Olympics.

When the new stations are included, broadcast revenues doubled. Thanks to these increases, Gannett’s total revenues grew 3% when the new stations are excluded, and 13% (to $1.4 billion) when the new stations are included.
 
Meanwhile, McClatchy Co.’s total revenues fell 2.7% from $295 million in the first quarter of 2013 to $287 million in the first quarter of 2014 -- mostly as a result of a 6.7% decline in ad revenues, from $197 million to $184 million. The decline in ad revenues was partially offset by a gain in circulation revenues, which increased 5.8% from $85.8 million to $90.8 million over the same period, and digital-only revenues, which increased 11.6%. McClatchy’s digital-only ad revenue was up 11%.
 
McClatchy carries debt of nearly $1.56 billion, much of it assumed in the acquisition of former Knight-Ridder properties in 2006.

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