The New York Times Company reported a sharp drop in net income in the first quarter as the print advertising market remained stubbornly depressed for newspapers.
The company said net income fell 57.6 percent to $5.4 million, compared with $12.8 million in the quarter a year ago.
The weakness in print advertising, coupled with an unexpected drop in revenue at About.com, led to earnings of 4 cents a share before special items are excluded, compared with 8 cents a share in the period a year ago.
Revenue for the quarter dropped 3.6 percent to $566.5 million. Total advertising revenue declined 4.4 percent, but the performance by advertising sector varied widely. At The New York Times Media Group, which includes the namesake paper, NYTimes.com and The International Herald Tribune, the decline was 1.9 percent.
Digital advertising across the company grew 4.5 percent. As a percentage of the company’s total advertising revenue, digital was 28 percent, up from 25.6 percent a year earlier.
At the New England Media Group, which includes The Boston Globe, advertising revenue fell 5.1 percent. At the Regional Media Group, which includes local newspapers from Florida to California, the decline was 9.7 percent.
About.com, which experienced a loss in visitors after Google refined its search algorithms, saw a 10.2 percent drop in revenue.
The results did not reflect any revenue from the start of an online subscription model for NYTimes.com, which began after the end of the first quarter.
For the first time, the Times Company provided information on how digital subscriptions were faring. The company said that since it started limiting the number of articles readers could read on NYTimes.com for free, it has signed up more than 100,000 subscribers. While it said the program was still too young to judge a success, “early indicators are encouraging.” Subscriptions start at $15 every four weeks, but many subscribers have so far paid discounted introductory rates.
The company said it was optimistic that digital subscriptions would help improve the bottom line in the second quarter.
“While the challenges for our company and for the larger economy are not yet behind us, the recent launch of the Times digital subscription packages on NYTimes.com and across other digital platforms brings our plan for a new revenue stream to life, offering us another reason for optimism about the future,” the chief executive, Janet L. Robinson, said.
Operating costs at the Times Company were essentially flat at $535.4 million. Rising newsprint costs continued to weigh on the company. They rose 12.7 percent, offset partially by other factors, including a drop in circulation. Circulation revenue fell 3.7 percent, to $228 million.
The company ended the quarter with $352 million in cash and short-term investments, a lower amount than at the end of 2010 because of $54 million in pension contributions.
Article source: http://feeds.nytimes.com/click.phdo?i=6fe27ff5f386ce82df68d54244dda79f
Speak Your Mind
You must be logged in to post a comment.