Tribune Publishing Revs Down, Broadcast Soars

With the planned spinoff of Tribune’s newspapers as a stand-alone company coming up, the publishing division’s financials aren’t looking any stronger, judging by the company’s first-quarter results -- although the weak performance was more than offset by a major increase in broadcast revenues, reflecting strong performances at Tribune’s core broadcast properties and recent TV station acquisitions.
 
Tribune’s publishing division saw total revenues fall 2.6% from $465.9 million in the first quarter of 2013 to $453.8 million in the first quarter of 2014, due mostly to continuing declines in advertising revenues. They fell $19.3 million compared to the prior quarter, while commercial printing services were down $4.1 million. These losses were offset to some degree by acquisitions, including Gracenote.
 
Tribune’s broadcasting revenues soared 67% from $159.2 million to $398.4 million, when additional revenues from stations acquired from Local TV are included. When Local TV’s stations are included in the year-over-year comparison, revenues increased 7.9% from $369.3 million. The growth was principally the result of an increase in advertising revenues -- up 1.2% to $304.3 million -- and retransmission revenues, up 88% from $29.6 million to $55.6 million.
 
The planned spinoff of the newspaper division has been over a year in the making and is scheduled to take place some time in mid-2014. In March, Tribune announced that Jack Griffin, who previously served as CEO of Time Inc. and Meredith Corp., had been appointed CEO of Tribune Publishing Co. He will lead the newspaper operation’s planned spinoff from the rest of the old Tribune Co.
 
The newspaper spinoff is part of a major strategic shift by Tribune. The company is distancing itself from the newspaper business to focus on its local TV broadcasting operations, along with cable network WGN America, a stake in the Food Network, and online businesses, like Classified Ventures and CareerBuilder.
 
In February 2013, shortly after emerging from a tortuous four-year-long bankruptcy, Tribune put its newspapers on the auction block, but later withdrew them, presumably because of a lack of attractive offers. The company acquired 19 stations from Local TV Holdings for $2.73 billion, which closed in December.

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