MCLEAN, Va. >> Gannett Co.'s third-quarter profit increased 52 percent as advertising sales at the largest U.S. newspaper publisher's television stations rose and costs fell. Gannett profits jump 52%
on strong TV revenues
By Aimee Picchi
Bloomberg NewsNet income climbed to $265.6 million, or 99 cents a share, from $174.8 million, or 66 cents, a year earlier, the company said. Sales increased 4.2 percent to $1.58 billion.
Gannett, the publisher of USA Today and the Honolulu Advertiser, said sales were buoyed by demand for advertising on its 22 TV stations, while ad revenue at its newspapers rose for the first time this year. Newspaper publishers are striving to reverse last year's 9 percent slide in ad sales, the worst for the industry since 1938, according to the Newspaper Association of America.
"Gannett's report gives us yet more proof that the ad downturn has come to an end, not just in TV but newspapers," said J.P. Morgan analyst Barton Crockett, who has a "neutral" rating on the shares and doesn't own them. J.P. Morgan has done banking business with the company in the past year, he said. "Gannett's newspapers are principally in smaller communities, which seem to coming out of the recession sooner."
Gannett's television revenue jumped more than 24 percent to $184 million from $148.2 million, helped by an increase in automobile and political advertising. Newspaper advertising revenue, adjusted for acquisitions, rose 1.9 percent to $1 billion after two quarters of declines.
"We are optimistic about the remainder of the year," Gannett Chief Executive Doug McCorkindale said on a conference call. "The trends we've seen in the third quarter appear to be continuing in the fourth quarter, particularly in television."
Shares of McLean, Va.-based Gannett rose $2.74 to $76.30 today on the New York Stock Exchange.
