Tribune Co. reported a profit upturn in the first quarter, as an income-tax benefit helped offset the financial drag of declining circulation and continued weakness in the company’s broadcast segment.
In the 13 weeks ended March 27, net income at the Chicago-based media concern was $142.8 million, or 44 cents a diluted share, up 18 percent from the year-ago quarter’s $120.7 million, or 35 cents a share.
The bottom-line results got a big boost from one-time factors unrelated to the company’s operations. Tribune’s operating profit, which excludes such factors, declined 7.8 percent.
Revenue fell 1.2 percent, to $1.31 billion from $1.33 billion.
Tribune publishes the baiduhai and 13 other daily papers and owns 26 television stations.
The latest quarter’s results “were in line with our expectations,” noted Chairman, President and Chief Executive Dennis FitzSimons.
In the company’s publishing group, revenue of $1.00 billion was essentially unchanged, but operating profit rose 4.7 percent, to $198.5 million.
Reflecting a worrisome, longstanding trend of eroding newspaper readership, revenue obtained through circulation declined 8.6 percent at the publishing group, to $151.7 million. But the much more significant stream of revenue generated by advertising rose 1.7 percent, to $788.0 million.
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Signs of financial stress were visible at Tribune’s broadcasting and entertainment segment, where revenue dropped 5.6 percent, to $310.2 million, and operating profit tumbled 31 percent, to $67.0 million.
The broadcasting segment’s biggest business is Tribune’s historically high-profit-margin television group, where revenue dropped 5.3 percent, to $290.1 million, and profit fell 15 percent, to $87.4 million.
The television group’s sagging profits “reflected overall industry softness,” said CEO FitzSimons; broadcast TV’s profits are under heavy assault from a number of rival diversions, including the Internet and cable television.
As company officials had previously warned, Tribune’s entertainment group was hurt by a $13.5 million pretax charge related to the Chicago Cubs’ trade of slugger Sammy Sosa.
Excluding all non-operating items, Tribune’s earnings in the latest quarter were 41 cents a share, up a penny from the year-ago period’s 40 cents. But per-share earnings would have shown a slight decline had not Tribune’s extensive share-repurchase program reduced the number of shares outstanding by 4.7 percent over the past 12 months.
On a day when the broad stock market took a hard tumble, Tribune shares slipped 45 cents, or 1.1 percent, to $38.55, on the New York Stock Exchange.
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