Gannett Co. Inc., parent of the Rochester Democrat & Chronicle Media Group and USA Today newspapers, saw its net profit fall by 43 percent in the first quarter. The dip was attributable to recent acquisition of Belo Corp.
The company posted a net profit of $59.2 million—or 25 cents per share—compared with $104.6 million—or 44 cents per share—in the same quarter of 2013.
The Virginia-based media company’s 27 percent increase in non-GAAP earnings per diluted share or 47 cents a share for the quarter beat analysts’ expectations of 46 cents. The company had 37 cents a share for the same period a year ago.
The firm logged a 13 percent increase in revenues in its first quarter to $1.4 billion from $1.24 billion a year ago. The growth reflects Gannett’s acquisition of Belo on Dec. 23, 2013.
Analysts expected revenues of $1.41 billion.
The company also experienced record broadcasting segment revenues due to higher advertising demand brought on by the Winter Olympic Games and political ads. Broadcasting revenues nearly doubled to $382.3 million in the quarter, a 99.5 percent increase from the same period last year.
“This was a terrific first quarter for Gannett, in which the fundamental changes we’ve been making to our business meaningfully impacted our top and bottom lines,” said Gracia Martore, president and CEO of Gannett, in a statement. “An outstanding performance by our new broadcast stations fueled double-digit increases in both revenue and profitability in our broadcast segment.”
The company’s operating revenues were $1.4 billion—a 13.4 percent increase from 2013—reflecting growth in broadcast and digital segments of the business. Publishing revenues declined by 3.3 percent due to reduced advertising demand and circulation revenues.
Advertising revenue fell by 5 percent to $501.3 million; circulation revenues fell 1 percent to $282.1 million. The company’s digital division saw a 3 percent increase in revenue to $179.7 million, which reflects results of the company’s CareerBuilder website.
The company’s total digital revenue increased 6 percent to $375.6 million.
Gannett’s net income attributable to the company on a non-GAAP basis was $108.4 million—a 26 percent increase—compared with the first quarter of 2013. Non-GAAP operating income was up 40.7 percent, totaling $226.8 million.
“With greater scale and new innovative product offerings, we’ve successfully deepened our connections with customers across all platforms and positioned Gannett to grow and thrive in the digital age,” Martore said.
Shares of Gannett dropped slightly to $27.02 Wednesday afternoon from Tuesday’s close of $27.15.
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