Tribune Co., which owns The Baltimore Sun, seven other major dailies and 23 broadcasting stations, said Monday that its third-quarter 2008 operating revenues declined 10 percent, or $122 million, to $1 billion as compared with Q3, 2007.
Operating profit for the quarter, Tribune Co. said, declined 83 percent year-over-year to $37 million.
The company had previously reported a second-quarter 2008, year-over-year operating revenue decline of 6 percent, or $67 million, and a first-quarter 2008 revenue drop of 8 percent, or $95 million, year-over-year.
“We are operating in an exceptionally difficult financial and economic environment,” said Tribune Co. Chairman and CEO Sam Zell in a statement. “The newspaper industry continues to see extraordinary declines in ad revenues, and Tribune is no exception.
“But, we continue to aggressively pursue our operating strategy,” Zell added, “and to tightly manage the factors that are within our control.”
In its flagship publishing business, the company’s third-quarter operating revenues declined 13 percent, or $99 million, year-over-year to $654 million. This reflected a quarterly advertising revenue drop of 19 percent, or $111 million, comprising 10 percent, 21 percent and 30 percent declines in retail, national and classified advertising revenues respectively.
Previously, the company had reported a second-quarter 2008 revenue drop in publishing of 11 percent, or $83 million, year-over-year and a 15 percent decrease in the quarter’s advertising revenues.
The struggling conglomerate’s first-quarter retreat in its publishing’s operating revenues had earlier been reported also at 11 percent, or $103 million, year-over-year.
“It’s not anything unusual; it’s all in the business,” Ted Venetoulis, spokesman for a local group of investors interested in buying The Baltimore Sun, reacted. “Everyone’s seeing [these downturns] — and will until the economy or the newspaper business itself turns around.”
Venetoulis didn’t want to speculate on whether continuing revenue shortfalls at Tribune Co. might force Zell eventually to accept the group’s undisclosed offer for The Baltimore Sun.
“Tribune’s report is typical of all the reporting companies,” said Maryland-based newspaper analyst John Morton, who added that average operating margins of the major U.S. papers year-to-date is still about 12 percent. “It’s hitting Tribune harder because they have bigger papers.”
Tribune Co. reported that even its third-quarter broadcasting and entertainment revenues, bright spots in previous quarters, were down 6 percent, year-over-year, to $383 million, and that its interactive revenues had also dropped 7 percent — due totally to classified advertising decreases.
Paid daily circulation at the newspaper chain, the company said, was down 7 percent for the quarter, to 2.2 million copies. Sunday paid circulation dropped 5 percent to 3.3 million copies.
The company also reported that it had cut 1,300 full-time positions in the quarter and that its debt burden was $11.8 billion.
