• by Erik Sass , March 2, 2007

The Washington Post Company's fourth-quarter 2006 profits sank 7% compared to the same quarter in 2005, ending at $95.5 million. This occurred despite a 10% revenue growth to $1.04 billion, the company said Wednesday. The rising revenues mostly reflected the strong performance of businesses outside the flagship newspaper, including the Kaplan education division and TV broadcast operations.

The newspaper division's overall revenue fell 2% to $247.2 million in the fourth quarter, with ad revenues falling 8% to $145.6 million. Among the hardest hit areas were employment recruitment classified ads, which sank 22% in the fourth quarter to $12.5 million. For the full year, revenue from classified recruitment ads was down 14% to $68.1 million.

As a result of these declines and other expenses, the division's overall operating income imploded, plummeting almost 50% from $125.4 million in 2005 to $63.4 million in 2006. According to the company's executives, this drop is a one-time event associated with the costs of an employee buyout program, as well as taxes levied during property transactions.

As in previous quarters, online was the area of strongest revenue growth for the newspaper, jumping 22% to $30 million. For full year 2006, online revenue rose 28% from 2005 to $102.7 million. Within this arena, online display advertising grew especially quickly, although specific dollar figures weren't provided. For the fourth quarter, it rose 35%, and for the full year it was up 46%. Online classified revenue was up 8% in the fourth quarter and 18% for the year.