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Knight Ridder profit declines 22% (Dinosaur Media Extinction Alert)
Marketwatch.com ^ | Jan 31, 2006 | David B. Wilkerson

Posted on 01/31/2006 12:47:00 PM PST by abb

CHICAGO (MarketWatch) -- Knight Ridder said Tuesday that its fourth-quarter profit declined 22% from a year earlier on the absence of newspapers in Detroit and Tallahassee, Fla.

San Jose, Calif.-based Knight Ridder, the second-largest U.S. newspaper publisher said its net income was $83.3 million, or $1.24 a share, compared to $107.2 million, or $1.38 a share, in the same quarter last year.

Last year, Knight Ridder sold its interest in the Detroit Free Press to Gannett Co. and MediaNews Group. It also swapped the Tallahassee Democrat and an undisclosed cash amount in exchange for three Gannett papers, The (Boise) Idaho Statesman, The (Olympia, Wash.) Olympian and The Bellingham (Wash.) Herald.

Revenue rose 3.1% to $820 million from $795.5 million.

Analysts polled by Thomson First Call expect a profit of $1.22 a share on revenue of $817 million.

The company put itself on the block last fall after grumblings from two of its largest institutional shareholders, and a bidding process is underway.

During a conference call with analysts, Chairman Tony Ridder declined comment on the sale. "As you all understand, it takes time and we do not intend to talk about either the process or the participants while it is ongoing," he said.

Total advertising revenue rose 3% to $659.1 million, with circulation revenue up 2.3% to $135.8 million. Total costs were higher by 6.1%.

On a pro forma basis, as if Knight Ridder had owned The (Boise) Idaho Statesman, The (Olympia, Wash.) Olympian and The Bellingham (Wash.) Herald for at least a year, total ad revenue declined 0.2%, while circulation revenue slipped 1.2%. Total costs rose 1%.

"Despite flat revenue, we beat the Street's consensus by two cents and faced by far the stiffest advertising comparisons of the year," said Ridder, in a statement. "Knight Ridder Digital and our targeted publications both sustained their strong growth curves. Costs were down substantially from their third-quarter level and below the average for the year."

Ridder told analysts the company expects ad revenue to improve by a range of 3-4% in 2006 over 2005, with "more growth in the second half than the first."

The company's profit is expected to rise by a mid-to-high single digit percentage, Ridder said.

In an industry-wide trend, classified ad revenue rose 4.8%, reflecting ongoing strength in help-wanted and real estate ads. Help-wanted sales rose 21%, while real estate jumped 13.3%. Each category had its best performance of 2005.

Retail ad revenue fell 1.1% on declines in department store, home electronics and grocery store ads. National ad sales declined 6.8%.

Automotive classified ad revenue plunged 17%, the worst quarterly performance of the year in a category that has been a sore spot for all the newspaper publishers over the past several quarters.

As more readers turn to the Internet for news and information, newspaper publishers have been able to post significant online revenue gains. At Knight Ridder Digital, revenue jumped 55.4% to $45.5 million.

In December, total ad revenue rose 2%, with retail revenue down 0.2%, national revenue down 4.5% and classified revenue up 10.5%.

On a pro forma basis, December ad revenue fell 1.1%, with retail down 3.5%, national down 5% and classified revenue up 5.8%.

Tony Ridder said January ad revenue looks stronger than that of December.

Knight Ridder shares declined $1.19, or 2%, to $62.26 in afternoon trading.

David B. Wilkerson is a reporter for MarketWatch in Chicago


TOPICS: Front Page News; News/Current Events
KEYWORDS: biasmeanslayoffs; dinosaurmedia; msm; newspapers; oldmedia; schadenfreude
More good news for today....
1 posted on 01/31/2006 12:47:03 PM PST by abb
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To: abb

"More good news for today...."

You got that right, brother. Hope this means that their leftwing rag, the Akron Beacon Journal, will be gone soon.


2 posted on 01/31/2006 12:50:04 PM PST by Pittsburg Phil
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To: abb

"More good news for today...."

You got that right, brother. Hope this means that their leftwing rag, the Akron Beacon Journal, will be gone soon.


3 posted on 01/31/2006 12:50:12 PM PST by Pittsburg Phil
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To: abb

Propaganda masquerading as news -- it just don't sell


4 posted on 01/31/2006 12:50:29 PM PST by Lexington Green (FOX doctored the news to satisfy a Saudi stockholder.)
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To: abb

Boo hoo NOT


5 posted on 01/31/2006 12:52:07 PM PST by OldFriend (The Dems enABLEd DANGER and 3,000 Americans died.)
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To: abb
It must be because there are no terrorists.

Isn't it funny how they denigrate Fox News while they go broke?

6 posted on 01/31/2006 12:52:56 PM PST by tiki
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To: abb

Good riddance.


7 posted on 01/31/2006 12:53:29 PM PST by Brilliant
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To: abb

As Judge Smails might say, "Well, Mr. Unemployed Journalist Guy, the world needs ditchdiggers too."


8 posted on 01/31/2006 12:53:31 PM PST by A Balrog of Morgoth (With fire, sword, and stinging whip I drive the RINOs in terror before me.)
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To: abb

The WSJ's version of the story...

Knight Ridder's Net Falls 22%
By JOSEPH T. HALLINAN
Staff Reporter of THE WALL STREET JOURNAL
January 31, 2006 1:01 p.m.

Knight Ridder Inc., which put itself up for sale in November, reported that fourth-quarter net income fell 22% on flat revenue.

Profit for the quarter was $83.3 million, or $1.24 a share, down from $107.2 million, or $1.38 a share, a year earlier. Revenue rose 3.1% to $819.9 million.

Shares fell in afternoon trading, down $1.42, or 2.2%, at $62.03, on the New York Stock Exchange.

The company's results were muddied by newspaper swaps and sales earlier in the year. On Aug. 29 Knight Ridder acquired three newspapers in the western U.S. in exchange for a paper in Tallahassee, Fla., and cash. It also sold its Detroit newspaper operations to Gannett Co. Results for the three acquired papers are included in the fourth-quarter results.

For the year ended Dec. 25, Knight Ridder earned $471.4 million, $6.52 a share. That includes $2.87 a share from gains on the sale of Detroit and Tallahassee. In 2004, it earned $326.2 million, or $4.13 a share, including 35 cents a share from the reclassification of Detroit and Tallahassee as discontinued operations.

San Jose-based Knight Ridder is the nation's second-largest newspaper chain by circulation, with 32 daily papers, including the Philadelphia Inquirer and the Miami Herald. The company was forced to put itself up for sale last fall after its largest shareholder urged the company to evaluate its "strategic alternatives." The company said costs associated with this evaluation amounted to four cents per diluted share in the quarter.

In a statement, company Chairman and CEO Tony Ridder said the company's online ventures were growing, with revenue at Knight Ridder Digital up 55.4% for the quarter, to $45.5 million.

But its print products haven't done so well. Big markets continued to fare worse than smaller ones. Total ad revenue in Knight Ridder's top nine markets, including Philadelphia and Kansas City, fell 1.6% for the quarter; the mid-sized and smaller markets were up 2.3%. For the year, the company said, ad revenue in large markets inched up only 0.4%; in small and mid-size markets, it rose 4.3%.

Circulation continued to decline in the fourth quarter, down 4.1% daily and 4.3% Sunday. The company said price increases in some markets contributed to the decline. For the full year, circulation declined 3.1% daily and 3.3% Sunday. The company's results were boosted by a share repurchase. During the quarter Knight Ridder bought back 857,000 of its shares. Total repurchases for the year were 10.4 million, bringing total shares outstanding at the end of the year to 66.9 million.

Write to Joseph T. Hallinan at joseph.hallinan@wsj.com


9 posted on 01/31/2006 12:54:24 PM PST by abb (Because News Reporting is too important to be left to the Journalists.)
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To: abb

A 10% profit doesn't look bad.


10 posted on 01/31/2006 12:55:34 PM PST by Hermann the Cherusker
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To: abb

I hate what Knight-Ridder did to the Biloxi Sun Herald when they bought it...


11 posted on 01/31/2006 12:58:17 PM PST by trebb ("I am the way... no one comes to the Father, but by me..." - Jesus in John 14:6 (RSV))
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To: abb

I've emailed DIRECTV and the FCC in support of the 'A La Carte' cable/satellite subscription concept. I don't think I should be forced to pay for cable channels I don't watch. I don't wish to subsidize CNN, MTV, etc. any more. I believe this is a good way to defund the MSM.

Link to FCC 'A La Carte' comment form:
http://gullfoss2.fcc.gov/ecfs/Upload?hot_docket=1009000877%7C04-207%7CCable+and+Satellite+subscriber+options%2C+e.g.+a+la+carte+channels&Send=Continue


12 posted on 01/31/2006 12:59:18 PM PST by golas1964 ("He tasks me... He tasks me, and I shall have him!")
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To: abb

13 posted on 01/31/2006 1:04:17 PM PST by Kokojmudd (Outsource the US Senate to Mexico! Put Walmart in charge of all Federal agencies!)
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To: abb
When Hayden gave his great speech about the NSA terrorist surveillance program he gave a great slap down to a very ignorant Knight Ridder Reporter.

The reporter was making false claims, in a very angry tone mind you, about the text of the fourth amendment.
It was fantastic!
14 posted on 01/31/2006 1:04:37 PM PST by msnimje (SAMMY for SANDY --- THAT IS WHAT I CALL A GOOD TRADE!!!)
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To: Hermann the Cherusker

....The company's results were muddied by newspaper swaps and sales earlier in the year....

To me this is the key and the rest is misleading. To say profits are down comparatively with the same quarter and not go deeper is bad reporting. One would expect revenues and resultin profits to decline is major pieces of the business are sold. The question is how is the return on capital now? up or down?


15 posted on 01/31/2006 1:05:54 PM PST by bert (K.E. N.P. Slay Pinch)
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To: abb

Good.


16 posted on 01/31/2006 1:16:33 PM PST by Spirited
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To: Spirited
Bill Gates talked about companies in a "death spiral" where they can't pull out and reinvent themselves in time. That's because it's much easier to grow fast than it is to shrink fast. If a company has invested in new buildings and capital equipment for years and years, it's quite hard to divest those fixed expenses and to change the culture to a smaller, leaner organization.

Hence, the image of dinosaurs bogged down in a tar pit.

17 posted on 01/31/2006 1:32:08 PM PST by DJtex (;)
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To: abb

Great news!


18 posted on 01/31/2006 1:44:52 PM PST by ncountylee (Dead terrorists smell like victory)
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To: Jim Robinson

Does the 'excerpt and link only' list need to be updated to reflect that the Tallahassee Democrat is now Gannett (the Detroit paper seems to already be on the Gannett list) and that the the (Boise) Idaho Statesman, the (Olympia, Wash.) Olympian and the Bellingham (Wash.) Herald are not, or do you need to wait until you get something 'official' from the companies?


19 posted on 01/31/2006 2:18:16 PM PST by PAR35
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To: golas1964

Thanks for that link.


20 posted on 01/31/2006 2:27:32 PM PST by PAR35
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To: abb
Kewl. Yet another new trophy to add to my shrine to Old Media. :) A work of FReeper performance art known as Got them Old Media Circulation Blues inspired by an ancient axiom that bad news sells. ;)

Knight Ridder profit declines 22% (Dinosaur Media Extinction Alert) - 01/31/2006
TIMES BOMBS ("paper of record" 2001-04 daily circulation off 19%) - 01/11/2006
TIMES' 4Q PROFIT OFF (attributes costs of 500 job cuts) - 12/22/2005
Gannett Nov. Revenue Drops 2.1% (Other MSM sinking, too) - 12/08/2005
L.A. Times Drags on Tribune Revenue (200 *more* layoffs expected) - 12/02/2005
Newspaper circulation down. Sanfrancisco Chronicle down 17% - 11/08/2005
Newspaper Circulation Continues to Decline (NY Daily News DOWN 1.5% - May 2005) - 10/24/2005
Bored readers cutting off Globe’s circulation - 10/20/2005
Time Inc. Gets A U.S. Subpoena About Circulation - 09/24/2005
Denver papers use liberal rules to boost circulation - 08/08/2005
Advertisers Sue 'Minneapolis Star Tribune' Over Circulation Inflation - 06/29/2005
Arrests made in Newsday circulation scandal - 06/16/2005
Los Angeles Times Reports March Circulation (Down, down, down) - 05/02/2005
Belo Begins Refunding Advertisers Over Inflated Circulation Figures (Texas) - 05/02/2005
Why Can’t the Washington Post Keep Circulation Up? - 07/23/2004
Newsday, Hoy publishers retire amid circulation scandal - 07/19/04
Publishers Seek Scapegoats for Circulation Woes - 07/05/2004
Tribune Company (LA Times parent) Admits Inflated Circulation Numbers At Two Papers - 06/23/2004
21 posted on 01/31/2006 4:12:12 PM PST by Milhous (Sarcasm - the last refuge of an empty mind.)
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To: abb

Music to my ears.


22 posted on 01/31/2006 7:25:48 PM PST by dr_who_2
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To: bert

it DOES muddle things if the company does not clearly break out numbers in the EPS press release. Presumably they will in the 10q/k but that might not be filed yet...dunno.


23 posted on 02/01/2006 12:17:22 AM PST by WoofDog123
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To: abb

The WSJ's spin on this ongoing mass extinction phenomenon...

By JOSEPH T. HALLINAN
Staff Reporter of THE WALL STREET JOURNAL
February 1, 2006; Page B3

Knight Ridder Inc., which put itself up for sale in November, said net income fell 22% in the fourth quarter on nearly flat revenue.

The second-largest U.S. newspaper publisher in terms of circulation said net income declined to $83.3 million, or $1.24 a share, from $107.2 million, or $1.38 a share, a year earlier. Revenue rose 3.1% to $819.9 million, including the results from three newspapers it acquired in August.

Knight Ridder shares fell $1.20, or 1.9%, to $62.25 in heavy 4 p.m. composite trading on the New York Stock Exchange.

"The quarter was a tough one," Tony Ridder, chairman and chief executive, said on a conference call with analysts.

Knight-Ridder's earnings were muddied by swaps and sales of some of its newspapers. On Aug. 29, the company acquired three newspapers in the West in exchange for a newspaper in Tallahassee, Fla., plus cash. It sold its Detroit newspaper operations to Gannett Co.

For its fiscal year ended Dec. 25, Knight Ridder's net income rose to $471.4 million, or $6.52 a share, including $2.87 a share from gains on the transactions involving the Detroit and Tallahassee papers. In 2004, net income was $326.2 million, or $4.13 a share, including 35 cents a share from the reclassification of Detroit and Tallahassee as discontinued operations.

Per-share income from continuing operations during 2005 dropped to $3.53 a share from $3.78.

For the quarter, total advertising revenue rose 3% to $659.1 million. However, auto classified revenue tumbled 17%.

Knight Ridder, of San Jose, Calif., owns 32 daily newspapers, including the Philadelphia Inquirer and the Miami Herald. The company had to put itself up for sale last fall after its largest holder urged it to evaluate strategic alternatives. The company said costs associated with the study totaled four cents a diluted share in the quarter.

The company said online ventures were growing, with revenue at Knight Ridder Digital up 55% for the quarter at $45.5 million. It said it is considering expanding its jointly owned, online help-wanted service, CareerBuilder, to Canada, the United Kingdom and India.

But its print products haven't done so well, continuing to fare worse in big markets than in smaller ones. Total ad revenue in Knight Ridder's top nine markets slipped 1.6% for the quarter; ad revenue in midsize and smaller markets advanced 2.3%. For the year, the company said, ad revenue in large markets edged up 0.4%; in small and midsize markets, it rose 4.3%.

Circulation declined in the quarter, off 4.1% daily and 4.3% Sunday, partly on price increases. For the year, circulation dropped 3.1% daily and 3.3% Sunday.

Write to Joseph T. Hallinan at joe.hallinan@wsj.com


24 posted on 02/01/2006 4:49:35 AM PST by abb (Because News Reporting is too important to be left to the Journalists.)
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To: abb

Who said there was only Bad News?? Maybe they should try printing the Truth???

Pray for W and Our Freedom Fighters


25 posted on 02/01/2006 4:53:10 AM PST by bray (President Bush Protects America. The Rats Protect Terrorists.)
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To: bray

check this out...

http://www.freerepublic.com/focus/f-news/1569249/posts


26 posted on 02/01/2006 4:54:30 AM PST by abb (Because News Reporting is too important to be left to the Journalists.)
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To: abb

In other news...

- Buggy whip makers saw a decline for the 113th straight year following a continued refusal by the public to ride horses
- Monks copying ancient Biblical texts went on strike, calling for regulatory guidelines limiting the printing press
- Whale oil producers convene summit to focus on long-term trend away from their product
- Officials from the Mountain Men of America, one of this country's oldest unions, called for a boycott of what they called "the pernicious spread of railways, roads, and housing into territory formerly the domain of America's mountain men." Jeremiah Johnson IX, president of the MMA, was somewhere in northern Wyoming and unavailable for comment
- Quill pen manufacturers close doors on factories in New Jersey and Ohio, prompting Democrats to decry the state of America's economy and causing large numbers of geese to roam the landscape


27 posted on 02/01/2006 11:33:23 AM PST by redpoll (redpoll)
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To: kjenerette

...reading.


28 posted on 02/01/2006 1:59:29 PM PST by Van Jenerette (Our Republic...If We Can Keep It!)
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To: trebb

I agree,my husband and I quit taking the paper when Stan Tiner became editor.What used to be a joke about it being the "Daily Mullet Wrapper",became reality.I can get more news than I can absorb from the Internet.


29 posted on 02/01/2006 3:17:53 PM PST by mrsmel
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To: mrsmel

Stan Tiner!! Is he the Biloxi Sun Herald Editor? That creep used to be the Editor of the now defunct Shreveport (LA) Journal. A real liberal whacko...


30 posted on 02/01/2006 5:58:09 PM PST by abb (Because News Reporting is too important to be left to the Journalists.)
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To: abb

That's who. The Sun Herald has been an utter rag since he took over.


31 posted on 02/02/2006 6:21:28 AM PST by mrsmel
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