• The Wall Street Journal, Tuesday, April 14, 2009 11 AM

This Thursday's earnings report for newspaper publisher Gannett is expected to kick off the ugliest quarter in recent memory for the newspaper industry.

Declines in print ad revenue accelerated through the end of last year, and if early returns this year offer no clearer view of a bottom, publishers could start taking more aggressive action, including closing papers or shifting operations online. Analysts and industry executives will be searching for any glimmer of an ad recovery.

As for Gannett, though most of its papers are profitable, profits are shrinking. The company's entire debt structure is due to mature by 2012 and to alleviate pressure, Gannett last week announced a bond exchange to push out some of its maturities. Circulation at flagship paper USA Today is set to fall by about 100,000, due to lower occupancy in hotels, which account for more than half of its 2.3 million circulation, per the ABC.

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