Tribune Co. Chairman and Chief Executive Officer Sam Zell likely enjoyed the “Born To Be Wild” entrance music played at The Sun?s recent all-employee meeting with him.
But the motorcycle-riding billionaire can?t be wild about his company?s latest earnings report, released last Thursday.
In fact, the $78 million fourth-quarter 2007 loss from continuing operations ? compared to a $233 million fourth-quarter 2006 gain ? and 12-fold decline in ?07 income to $55 million may even have him thinking about selling once-sacred “core assets,” including The Sun.
“We have begun a strategic review of certain Tribune assets to determine whether capital can be more effectively redeployed into our core operations or toward reducing our outstanding leverage,” Zell, who took the company private in a $8.2 billion merger last year, said in an otherwise upbeat statement about on the report.
Similar sentiments were conveyed a week earlier at The Sun?s meeting, where, in response to a question about his willingness to sell the paper, Zell reportedly answered, “I don?t know.”
“There were a lot of pointed questions about coverage ? about the newspaper as opposed to the business,” said Tanika White, Baltimore-Washington Newspaper Guild unit co-chairwoman and Sun reporter. “His message was, ?If we make more money, we can talk about [coverage].? ”
According to White, Zell also said that the paper?s disparate real estate configuration ? including its remotely located 20-person Web page operation ? doesn?t make “a lot of sense,” and he “very much wants to fix it.”
The company may have good reasons to keep its Web operation at the expensive Village at Cross Keys site, however, said Bill Salganik, president of the Baltimore-Washington Newspaper Guild. Its location figured into a court ruling that its personnel are not covered by Guild-Sun management agreements.
“I think that?s the main reason they keep it that way,” Salganik said, “because it certainly doesn?t make it a better Web site.”
According to the report, Tribune Co. fourth-quarter 2007 operating revenues decreased 7 percent year-over-year to $1.27 billion, while its newspaper operating revenues were down 7 percent for the quarter to $952 million.
Overall advertising revenues declined 9 percent ? or $132 million ? for the quarter, and circulation revenues fell 5 percent, or $17 million. The company?s 2007 newspaper operating revenues declined 7 percent, to $3.66 billion.
