• by Wayne Friedman , July 31, 2008

Meredith Corp.'s fourth-quarter 2008 financial results hit investors hard. Earnings were more than cut in half from its fiscal 2007 results. Meredith posted $19 million in earnings, down from $52 million in the quarter before. Revenues were also down $385 million from $428 million. All that sent investors scrambling, pushing down the company's stock by more than 8% in midday trading to $25.55.

The company said that after a strong performance in the first half of fiscal 2008, the economic slowdown was tough--producing lower advertising demand from a soft retail marketplace, which resulted in weaker sales. For its publishing group, the company experienced higher costs, particularly paper costs.

The fourth-quarter operating profit for publishing was $26 million versus $70 million in the comparable period in 2007. Total revenues were $306 million and advertising revenues were $153 million, compared to $345 million and $178 million, respectively, in fiscal 2007.

Advertising pages--especially from food, prescription and non-prescription drugs and home marketers--declined more than 20%, accounting for about 75% of total fourth-quarter advertising page declines.

Circulation revenues declined at Parents, Family Circle and Fitness magazines.

The Meredith Corp. broadcasting group's operating profit was $19 million compared to 2007's $28 million. Revenues were $79 million, compared to $84 million in fiscal 2007. During the last six months, Meredith TV stations witnessed a decline in automotive advertising, as well as retail and movies, leading to a decline in non-political advertising revenues. In the first six months, non-political advertising revenues rose 4%, from online advertising and professional services and telecommunications ad categories.

Retransmission agreements for Meredith television stations increased fees 50% over the prior year.

As with other media companies, Meredith says broadcasting online and video-related revenues showed strong gains--climbing 80% in fiscal 2008. Average unique visitors increased more than 300%. More than 1.3 million videos were streamed each month during the year.

"The Better Show," a Web-based TV show riffing off its Better Homes & Gardens brand, will be carried in more than 35 markets beginning this fall. In addition, Comcast video-on-demand customers downloaded more than 600,000 Parents TV videos in fiscal 2008.