Friday, diversified education and media company Washington Post Co. (WPO) reported a 69% rise in profit for the third quarter, as revenues grew 2% from last year on increased growth at education and cable television divisions. However, print advertising revenue at its flagship newspaper declined 28% year-over-year, reflecting decreases in classified, general, zones and retail advertising.
For the third quarter, the Washington, District of Columbia-based company's net income available for common stock soared to $17.05 million from $10.10 million in the year earlier quarter. On a per share basis, earnings surged 68% to $1.81 from $1.08 last year.
Results for the quarter included after tax impact of $3.8 million or $0.40 per share in accelerated depreciation at The Washington Post, $18.8 million or $2.00 per share goodwill and other long-lived assets impairment charge related to Kaplan Ventures, and a $18.8 million or $2.00 per share impairment charges at two of its affiliates.
In the previous second quarter, Washington Post reported net income available for common stock of $12.2 million or $1.30 per share, compared to a loss of $2.94 million or $0.31 per share in the year-earlier quarter.
Operating revenues for the recent third quarter edged up 2% to $1.15 billion from $1.13 billion in the prior-year quarter.
For the preceding second quarter, Washington Post reported revenues that improved 2% to $1.13 billion from the previous year's revenue of $1.11 billion.
Segment wise, the company's Education division revenues for the latest third quarter grew 14% to $684.52 million and revenues at Kaplan, which organises test preparation courses, advanced 14% year-over-year to $684.52 million.
Cable television division revenue for the quarter rose 4% to $189.65 million from last year , boosted by continued growth in the division's cable modem and telephone revenues, and a $4 monthly rate increase for most basic subscribers in June 2009.
Newspaper publishing division revenue was $156.28 million, down 20% from the year earlier quarter, while print advertising revenue at The Post tumbled 28% to $70.00 million from the year ago quarter owing to large decreases in classified, general, zones and retail advertising.
Revenue for the television broadcasting division decreased 17% year-over-year to $64.60 million due to weaker advertising demand in all markets and most product categories, particularly automotive. Meanwhile, revenue for the magazine publishing division slipped 33% to $40.17 million from a year earlier due to a 48% reduction in advertising revenue at Newsweek.
Operating expenses for the quarter was $985.23 million, up 4% from $950.27 million in the year-ago quarter, while operating income climbed 52% to $61.23 million from $40.27 million in the corresponding quarter last year, and included $2.3 million of net pension credits.
Equity in losses of affiliates for the quarter was $27.1 million, compared to losses of $0.6 million in the same quarter last year.
In the third quarter of 2009, the Post, which publishes Newsweek, and Arthur Frommers Budget Travel magazine, as well as online media magazines, newsweek.com and budgettravel.com, offered a Voluntary Retirement Incentive Program to certain employees at Robinson Terminal Warehouse Corp. As a result, $1.1 million was recorded towards early retirement costs during the third quarter. For the nine-month period, net income available for common stock plunged 78% to $10.13 million or $1.08 per share from $46.00 million or $4.86 per share last year. Revenues for nine months edged up 1% to $3.33 billion from $3.30 billion in the same period last year.
Amongst others in the sector, New York-based news provider New York Times Co. (NYT), on October 22, reported a narrower loss in its third quarter, helped by cost reductions, while quarterly revenues declined 16.9% as advertising revenues dropped 26.9%. Net income, excluding items, came in above Street view.
WPO is currently trading at $458.47, up $6.44 or 1.42%, on the NYSE. In the past 52 weeks, the stock trended in a broad range of $300.16 - $495.60, with a three-month average volume of 41,393.9 shares.
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