In fact, Warren Buffett has said don’t buy newspaper stock at any price. The days of the monopoly newspapers huge readership and advertising revenue are long gone.
The McClatchy Company (NYSE: MNI – News) today reported a net loss from continuing operations in the fourth quarter of 2008 of $20.4 million, or 25 cents per share, including a pre-tax non-cash impairment charge of $59.6 million related to newspaper mastheads. Adjusted earnings from continuing operations(1) were $21.8 million, or 26 cents per share, in the fourth quarter of 2008 after excluding several unusual items discussed below. Total net loss including discontinued operations was $21.7 million, or 26 cents per share in the 2008 fourth quarter.
Management conducted its annual impairment testing of goodwill and other long-lived assets as of the end of its fiscal year, December 28, 2008. Upon completion of that testing, the company recorded a pre-tax non-cash impairment charge of $59.6 million to newspaper mastheads. The company did not record an impairment charge related to goodwill in 2008.
For the fourth quarter of 2007, the company reported an after-tax loss from continuing operations of $1.43 billion, or $17.42 per share, including the effect of non-cash after-tax impairment charges related to goodwill and newspaper mastheads of $1.47 billion, or $17.86 per share. Adjusted earnings from continuing operations(1) were $36.1 million, or 44 cents per share, in the fourth quarter of 2007 after excluding the non-cash impairment charges. The company’s total net loss, including the results of discontinued operations, was $1.43 billion, or $17.46 per share.
Revenues in the fourth quarter of 2008 were $470.9 million, down 17.9% from revenues from continuing operations of $573.4 million in the fourth quarter of 2007. Advertising revenues were $388.3 million, down 20.7% from 2007, and circulation revenues were $67.0 million, up 1.4%. Online advertising revenues grew 10.3% in the fourth quarter of 2008 and were 10.9% of total advertising revenues compared to 7.8% of total advertising revenues in the fourth quarter of 2007.
Using cash from operations and proceeds from asset sales, the company repaid $30 million of debt in the quarter and $433 million for all of 2008. Debt at the end of the fiscal year was $2.038 billion, down from $2.471 billion at the end of 2007.
Restructuring Plan
McClatchy noted that the duration and depth of the economic recession have taken a severe toll on its advertising revenues. Given the unprecedented deterioration in revenues and with no visibility of an improving economy, the company is continuing to reduce expenses. McClatchy announced that it is developing a plan to reduce costs by an additional $100 million to $110 million, or approximately seven percent of 2008 cash expenses, over the next 12 months beginning later in the first quarter of 2009. Details of the plan have not yet been finalized and as a result, costs to complete the plan are not yet known. In addition, the company will freeze its pension plans and temporarily suspend the company match to its 401(k) plans, effective March 31, 2009. The company will extend a salary freeze for senior executives in 2009 that was implemented in 2007. The company previously announced that it had implemented a company-wide salary freeze from September 2008 through September 2009. Gary Pruitt, McClatchy’s chairman and chief executive officer, also has declined any bonus for 2008 and 2009. In addition, other senior executives will not receive bonuses for 2008.
As previously reported, McClatchy will suspend its quarterly dividend after paying the first quarter 2009 dividend, which was declared on January 27, 2009, in order to preserve cash for debt repayment. The first quarter 2009 dividend of $.09 (nine cents) per share is half the per share dividend paid in the 2008 first quarter.
Full Year Results
Net income from continuing operations for fiscal 2008 was $2.8 million, or three cents per share, and was affected by the impact of the non-cash impairment charges and other unusual items discussed below. Adjusted earnings from continuing operations(1) were $55.4 million, or 67 cents per share, in fiscal 2008. Total net income including discontinued operations was $1.4 million, or two cents per share.
In addition to the impairment charges previously noted, results in 2008 included the impact of several unusual items including: a gain on the sale of a one-third interest in SP Newsprint Company; a gain on the extinguishment of debt; write-offs of deferred financing costs as a result of amendments to the company’s credit agreement; charges related to the implementation of previously announced restructuring plans; the write-down of certain internet investments; and adjustments for certain discrete tax items.
The loss from continuing operations for full year 2007 was $2.73 billion, or $33.26 per share, including the effect of the non-cash impairment charges taken in 2007. Adjusted earnings from continuing operations(1) were $110.9 million, or $1.35 per share, in fiscal 2007 after considering the non-cash impairment charges and adjustments for certain discrete tax items. The company’s total net loss, including the results of discontinued operations, was $2.74 billion, or $33.37 per share.
Revenues from continuing operations in 2008 were $1.9 billion, down 15.9% compared to $2.26 billion in 2007. Advertising revenues in 2008 totaled $1.6 billion, down 17.9% and circulation revenues were $265.6 million, down 3.7%. Online advertising revenues grew 10.6% in 2008 and represented 11.6% of total advertising revenues compared to 8.6% for all of 2007.
Management’s Comments
Commenting on McClatchy’s results, Pruitt said, “2008 was a difficult and disappointing year. We faced troubled economic times and structural changes in our business.
“Still, 2008 was a good year for our online business; online audiences and revenues rose sharply. In the fourth quarter, average monthly unique visitors to our websites were up 25.3% and were up 33.5% for all of 2008. Online advertising revenues grew 10.3% in the fourth quarter of 2008 and were up 47.3% excluding employment advertising, a category that has been impacted both online and in print by the nationwide decline in jobs.
“But the economy remains mired in recession and our industry is still in a period of transition. The advertising environment continues to be weak and we expect print advertising revenues to continue to be down. While we do not have final advertising revenue results for January, we know that the month was slower than the fourth quarter. We don’t have any better sense than other market observers as to how long the current recession will last and we do not yet have visibility of revenue trends.
“We must respond with both continued rigor in driving our revenue results as well as permanently reducing our cost structure. At McClatchy we are quickly becoming a hybrid print and online news and information company.
“Evidence of our cost reduction efforts can be found in our results. Excluding severance and other benefit charges related to our previously announced restructuring plans, cash expenses were down 14.4% in the fourth quarter and were down 11.5% in all of 2008.
“This necessary transition to a more efficient company is especially painful in a horrible economy and we have had to make some very difficult decisions to keep the company safe,” Pruitt said. “Even so, we are determined to treat our employees well and secure their retirement as best we can. So while we have announced that we are freezing our pension plans and will temporarily suspend 401(k) matching contributions as of March 31, we will continue to offer competitive benefits for our employees. We expect to offer a new 401(k) plan later this year that will include both a matching contribution (once reinstated), plus a supplemental contribution that is tied to cash flow performance. I recognize the sacrifices our employees are making to help us get though this difficult time and I appreciate their loyalty to McClatchy. I am confident that the McClatchy team is up to this challenge and we will see brighter days when the economy finally turns.”
Pat Talamantes, McClatchy’s chief financial officer, said, “Our new cost initiatives, combined with our 2008 efforts, are designed to save approximately $300 million annually before severance costs. Approximately $60 million of savings has been realized in 2008, and $44.7 million of severance costs associated with these programs has been expensed in 2008 and largely paid.”
“Despite the downturn in advertising revenues, we still continue to generate significant cash and are using it to repay debt,” Talamantes said. “Our debt at year end is $2.038 billion, down $433 million from the end of 2007. Based on our trailing 12 months of cash flow, our leverage ratio is currently 5.1 times cash flow and our interest coverage ratio is 2.8 times cash flow as defined by our bank agreement — well within the allowable covenant thresholds. We have $159 million in availability under our bank credit lines, and have no significant debt maturities until June 2011. We believe that we can work through this difficult environment, and we expect to make further progress in paying down debt in 2009.”
Other Matters
McClatchy also announced that it was notified by the New York Stock Exchange (the “NYSE”) that it is not in compliance with the NYSE’s continued listing standards. The NYSE’s notice dated February 4, 2009 indicated that on February 2, 2009, the company’s average share price over the previous 30 trading days was $0.98, which is below the NYSE’s quantitative listing standards. Such standards require NYSE listed companies to maintain an average closing price of any listed security above $1.00 per share for any consecutive thirty trading-day period. McClatchy plans to notify the NYSE of its intent to cure this deficiency and has six months from the date of the NYSE notice to cure the non-compliance. The company’s Class A common stock will continue to be listed on the NYSE during this interim period, subject to compliance with other NYSE listing requirements and the NYSE’s right to reevaluate continued listing standards.
Consistent with the growing industry practice, McClatchy will discontinue issuing monthly revenue and statistical reports after this release. McClatchy is among the last newspaper companies to report advertising results monthly, and without comparable industry information, management does not believe monthly revenues are as useful to investors. The company will continue to provide revenue trends and other statistical information on a quarterly basis with its earnings releases.
Besides skiing, wine gulping and dining 24/7, there are some presentations at Davos. I know, it is hard to believe.
Two thirds of people in the Western world don’t trust newspaper articles.
Lionel Barber, editor of the Financial Times, began a session saying that trust is an issue for the press as well as government and big business. Edelman found that trust in business magazines and analysts fell from 57% to 44% and from 56% to 47% respectively. Trust in TV news is down from 49% to 36% and in newspaper coverage from 47% to 34%.
The least trusted businesses: Banking and the auto business. In general the U.S., India, U.K., Poland and China, there is much more trust in business than in government. The French, Germans and most of Europe believe in Big Brother over the private sector. The sad part, the U.S. is moving toward the French.
The Tribune Company. filed for bankruptcy protection today, Dec. 8, 2008, as the owner of the Chicago Tribune, the Los Angeles Times, the Chicago Cubs and other properties tries to deal with $13 billion in debt.
On the same day, the New York Times Company is mortgaging its new glass tower and considering selling its only valuable asset to just stay afloat. But that’s not all, McClatchy is shopping around a buyer for the Miami Herald.
Advertising revenue declined severely this year because of the recession, putting pressure on newspaper companies. There are 31 or more major daily newspapers for sale.
Monday’s filing, made in bankruptcy court in Delaware, could give Tribune time to raise cash by selling off assets in a tight credit market. It also could put additional pressure on its lenders to ease their targets, possibly in exchange for higher interest rates, as many other newspaper companies already have done.
The company entered court protection with $13 billion in debt and $7.6 billion in assets.
Zell told employees in a memo that the Cubs franchise is not part of the bankruptcy filing. He also said the company’s operations, including newspapers and broadcast outlets, will function as before during the bankruptcy protection period.
“So, how did we get here? It has been, to say the least, the perfect storm,” Zell wrote. “A precipitous decline in revenue and a tough economy have coupled with a credit crisis, making it extremely difficult to support our debt. All of our major advertising categories have been dramatically impacted.”
Tribune’s biggest unsecured creditors are its lenders, led by JPMorgan Chase Bank and Merrill Lynch Capital Corp. JPMorgan is the administrator of $8.57 billion in senior debt and holder of about $1.05 billion of that.
One has to ask what the Tribune executive editors were thinking when they bought the Times-Mirror properties just a few years ago. Then, Zell has to kick himself for thinking he was the smartest guy in the room to take the whole mess private. Most of its debt comes from the complex transaction in which the company was taken private, with employee ownership, by Zell last year.
McClatchy’s stock is worth a gallon of gas, about $4.50. Think about that the next time you fill up. Even the New York Times total assets are worth no more than its new building and the stock has no voting rights. A bargain at $13? You think?
As the pink slips fly this summer at the old, elite daily newspapers from coast to coast, I continue to hear editors say “the model is broken.” That’s a tip that they know not what they do. Corporations don’t call operational or marketing plans models. Businesses run on plans, financial reports including daily sales, expenses, industry trends, local trends and regroup when “off plan.” There is always Plan B.
Now a columnist at the Poynter Institute, the non-profit think tank created by Nelson Poynter to continue the St. Pete/Clearwater Times past his death (and keep the company operational after the Democrats’ death taxes), is saying this is a good time to buy newspaper stock. Not so much.
McClatchy’s stock is worth a gallon of gas, about $4.50. Think about that the next time you fill up. Even the New York Times total assets are worth no more than its new building and the stock has no voting rights. A bargain at $13? You think?
But before you make a play at any of these stocks, remember the ancient Chinese saying, “Do not try and catch a falling knife.”
What is a newspaper worth? Compare it to an airline. Both industries have major payrolls, they are labor intensive, service businesses and both have major fuel costs. (Yeah, boys on bicycles don’t deliver papers anymore). Add newsprint to the newspaper costs.
Airlines sell seats. Newspapers sell space.
The airlines have business travelers and summertime vacationers. They have not lost any business class revenue and have done well with family fares because it is cheaper to fly than drive this summer. An airline can just cut back on less popular destinations. Keep the plane behind schedule and get a few more seats filled.
Newspaper revenue comes from advertising. They sell pages or column inches of advertising space instead of seats. But the newspaper planes take off every morning. They are flying the planes with a lot of empty seats.
The newspapers are run by the editors and sub-editors. Are airlines run by the flight attendants and pilots? I think not. Well, one is in a way. It’s not doing very well.
Advertising revenue is filling up the seats of the new online airbuses: Google, Yahoo, Drudgereport and Craigslist, with targeted advertising buys. The new online media has attractive “destinations:” young, well-educated middle class.
The newspapers destinations are not so hot. Think of 70 year olds in black socks, sandles and checker shorts, sitting at a park in Cleveland. “Wish you were still here.”
Not a pretty picture.
With thousands of newspaper reporters and editors getting pink slips this summer, it’s time to think of the future for the once honorable profession. I predict that the practice of newspaper journalism will become a hobby for old timers.
They will form “guilds” and get together to discuss the days when they had a hand in bringing down presidents and most members of the Republican party. The fun they had trashing the military, mocking MBAs and smearing corporate CEOs — good times! Meanwhile, they helped rewrite history, making heroes of Jimmy Carter, Al Gore, Hillary Clinton, Nancy Pelosi, Hugo Chavez and Fidel Castro.
Not unlike model railroad enthusiasts, retirees who waste away hours building mini cities with lichen evergreen trees and molded plastic mountains, old journos will have artifacts displayed around their rent-protected apartments, posters of Che, old typewriters, Green T-shirts, famous front pages of newspapers like “BUSH WINS!” printed before the Florida recount, they still don’t realize the headline was right, Bush did win and the Democrat party in Dade and Palm Beach counties tried to count bumps and chads as votes, while they discounted votes from resident military.
Former journalists will be semi-retired, working as greeters at Wal-Mart or sales associates at Borders Books. Those will be the better day jobs. Some will have blogs with readership in the dozens rather than tens of thousands they had in their hay days.
They can pretend to put out daily editions with DVDs playing classics like “The Front Page,” “All the President’s Men,” and episodes of “Lou Grant.”
Some will retain their journalist title by writing freelance for the local alternative press or if they are really good, the surviving monopoly big city newspaper that puts out a free tabloid addition once a week to augment its online daily edtions ‘Updated by the Minute’ will be one of their promotions.
“Pass me some prunes with sea grass, Debbie! Let’s write some sidebars on tips to avoid global warming.” “Wasn’t it grand that we saved Anwar from the gluttonous oil companies?” “Gas is $8 a gallon now as it is in Europe.” “America has finally matured.”
“I walk to the corner co-op for groceries anyway; that’s the way it should be.”
“I’m sure thankful Obama saved our Social Security…”
— Mick Gregory
There are no longer any suckers left with deep pockets and the desire to buy newspapers even at fire sale prices.
A lot can happen in five years.
The Chronicle was once the flagship of the Hearst Newspaper group; the San Francisco Chronicle enjoyed 1.4 million readers on Sunday and 1.2 million on weekdays. But that was five years ago. A lot can happen between nine and five, and a hell of a lot in five years. The Bronstein saga looks like it was 18 years, but most of that was with the much weaker Examiner, while Hearst waited for the JOA to run out.
By Mick Gregory
Michael Savage, the national talk show host based in San Francisco, would shed some light on Phil Bronstien’s poor editorial judgement and left coast, flunky editorial coverage and free political promotion for “friends” on a regular basis. My guess is that some executives with Hearst in New York believed Savage had made some good points. Bronstein’s time at the helm of the good ship Chronicle was a disaster.
Bronstein was a good friend of William R. Hearst III, apparently that was all that mattered. Mr. Bronstein was never as smart or as good a journalist or business manager as he thought he was.
He actually helped ruin The Chronicle by stripping out any competent editors, marketing and advertising executives that he perceived to be smarter. There were scores of them. One I will call BG, did more customer building for Hearst in one year than Bronstein in 18. In fact, Bronstein cost the Hearst Corp millions of dollars in lawsuits and the shady hand-off of the Examiner.
News smarts — Bronstein put on a wetsuit and posed for his photographers looking in a cold SF lake for a 14 inch aligator. What a newsman!
He got a lot more publicity when he was married briefly to Sharon Stone. At least there was some positive publicity for The Chronicle. But that soon went downhill. Remember the Komodo dragon that bit Phil’s toe? The Komodo has a bacteria-infested mouth, a real jounalist would have Googled the details before taking his shoe off and going in the cage with that animal. Bronstein would have to have medical treatments for months and walk in a cast. There were jokes about the condition of the poor Komodo dragon’s mouth having bit the flesh of Bronstein. And one of the meeting rooms was named the Komodo Dragon, not much Phil could do about that.
Taking charge
Right off the bat, Bronstein and then, publisher Tim White, did some “horse trading” with “Da Mayor” Willie Brown on allowing Hearst to pay the Fong family some $60 million to kill off the Examiner, so The Chronicle could have a monopoly in the fifth largest media market. OOPS, someone let the cat out of the bag and White retired to Carmel’s 17-mile Drive with a few million dollars to spare. That money to the Fongs and White could have come in handy in the next couple of years.
An analysis of four months of The San Francisco Examiner’s editorial pages shows the paper became more positive toward Mayor Willie Brown after its publisher offered the mayor more favorable coverage on August 30.
But the Examiner editorials did not give the mayor a free ride after its publisher, Tim White, offered Brown a more positive slant in exchange for the mayor’s support of the sale of the Chronicle to the Hearst Corporation.
For the readers of the Chronicle and Examiner the journalistic ethics of Bronstein and White were exposed for all to see thanks to an anti-trust suit brought by Clint Reilly.
The Grade the News Web site analyzed all Examiner editorials, editorial cartoons and columns on the editorial pages for two months before and two months after the Aug. 30 offer.
Editorials (including snippets from prior opinions reprinted in occasional summaries) which mentioned the mayor in a positive light increased from two before Aug. 30 to six after.
Nothing came of it. Reilly proved his point and Bronstein was preserved by Hearst, again due to William R. Hearst III’s friendship.
Now in total power, Bronstein ruined the Travel advertising category by eliminating special sections that long-time advertisers such as Harrah’s, The Eldorado, The Nugget and several Lake Tahoe resorts invested in. What did he put in its place? The wire copy of generic travel stories from around the globe and photos of campers by Emerald Bay claiming what a fine place Lake Tahoe is for kayaking. What do you think the casino hotel and ski resort executives thought of that?
Next, he actually used advertising profits from retailers in Union Square such as Macy’s, Nordstrom, Williams-Sonoma and several hotels to open a “Chronicle Cooking School” at the Embarcadero. Then he used his free newspaper space to promote it. He was promoting the Ebarcadero as the new shopping area of San Francisco. What do you think the advertising executives responsible for building traffic to Union Square thought about that? They were paying $20,000 a page for advertising day after day in The Chronicle for years.
But wait, there is more! The Chronicle before Bronstein was actually helpful in organizing the effort to build a new ballpark. It was a grand success. PacBell Park became a packed house, sometimes called the park that Bonds built. Bronstein, soon after decided to go after Barry Bonds and BALCO. For a couple of years you could count on a daily story of some anonymous leaks of grand jury testimony enhanced with speculation to tear down Barry Bonds.
Today, we learn that hundreds of baseball players have used steroids. And there is in fact no proof that Bonds did. What was that all about?
Politics, The Chronicle actually endorsed the corrupt Democrat Gray Davis over Arnold Schwartzenhager and all throughout the recall election, posted poll results that showed the recall failing. In fact, right up to election day!
On Nancy Pelosi, no stories about her non-union restaurants, hotel and vineyards. And her union political donations. Now that’s journalism!
Do you remember that Bronstein fired an old photographer because he was protesting the war in Iraq and shouldn’t have taken on a political cause? But then, just months later, Bronstein hires Sean Penn to report on his disdain for the war?
Did you know that Bronstein also gave his approval to a string of left wing icons such as Larry Flynt to speak to the Chronicle staff about “freedom of speech?”
But that’s not all. Bronstein cut the targeted news and advertising zoning in Contra Costa County and let the years of investment in the fastest growing suburbs of California go for nothing. The CC Times was soon fat and happy again, actually making more profit than The Chronicle with its replating of several East Bay newspapers and now the San Jose Mercury News. Their combined daily and Sunday readership is substantially higher than the Chronicle’s now.
That’s a sign of a savvy media baron, isn’t it?
Thumbs up go to Michael Savage for helping put an end to Bronstein’s reign of stupidity.
If Hearst executives did a detailed study of Bronstein’s management decisions, they could link a dramatic loss of readership, circulation and advertising to his tenure. Maybe they did just that.
Yesterday was the final press run of the Cincinnati Post. Turn out the lights, the Post is over. Note that even the paper’s “obituary” was written by a freelance journalist, not one of the staff. Telling isn’t it? The full-time Post writers didn’t even care enough to write it.
By Lew Moores
Post contributor
The history of The Cincinnati Post and Kentucky Post in the last four decades has been something of an exquisite paradox – an afternoon newspaper that had managed to attract incredible talent and practice a scrappy brand of journalism over those years while staring inexorably into the face of declining revenues and, ultimately, business failure.
What had been thought to be inevitable – certainly in the past decade or so – becomes indisputable today as The Post will cease publication.
A consensus emerges among more than a few Post alumni – even in the last 30 years as it functioned under a Joint Operating Agreement with the Cincinnati Enquirer, The Post was a joyride filled with effervescent memories.
Many Post alumni have also found their way into careers outside journalism, contributing to the community in other ways.
The Post was where Ken Bunting, now associate publisher of the Seattle Post-Intelligencer, practiced his incomparable brand of shoe-leather journalism. It was where Bob Mong, executive editor of the Dallas Morning News, was allowed to pursue hard-hitting, in-depth reporting. It was where Mike Blackman, who went on to become editor of the Fort Worth Star-Telegram, and Polk Laffoon IV, who went on to a remarkable career with Knight Ridder newspapers, both set the standards here in the ’70s for literary journalism.
It was where Michael Kelly cut his journalistic teeth in the early 1980s before moving on to the Baltimore Sun to the New York Times to the New Yorker to the New Republic to Atlantic Monthly. His was a meteoric career before it ended tragically in April 2003 when he was killed covering the early stages of the war in Iraq.
“The Post spawned a whole bunch of really interesting talent that left Cincinnati richer for the journalism they practiced,” recalls William R. Burleigh, chairman of the E.W. Scripps Co., parent company of The Post, and Post editor-in-chief from 1977 to 1983. “I think it was because The Post was always the underdog, and as a result was able to be not quite as conventional as the other paper in town and could afford some risks.”
The Post will also leave a legacy of service to the community in the many people who worked there who have gone on to serve in other community roles. Judy Clabes, for example, is president and CEO of the Scripps Howard Foundation, the philanthropic arm of E.W. Scripps, in addition to serving in a variety of other community roles. She was editor-in-chief of the Kentucky Post for 13 years, 1983 to 1996.
“My philosophy was we had to be connected to the community,” says Clabes. “I think we accomplished that. The staff was really connected to the community.”
Proof of that is former staffers who moved on and yet remained in the area and state. Jay Fossett, city manager of Covington since 2005, worked as a reporter and in an editing role on the sports desk at The Kentucky Post from 1981 to 1985.
J. Patrick Moynahan is a vice provost at Northern Kentucky University who worked at the Kentucky Post from 1984 to 1991, serving as city editor and assistant managing editor.
Mike Farrell, who worked at The Kentucky Post for 20 years as a reporter and managing editor, is the director of the Scripps Howard First Amendment Center at the University of Kentucky, where he teaches journalism.
Mark Neikirk, former reporter, city editor and managing editor, is now executive director of the Scripps Howard Center for Civic Engagement and Nonprofit Development at Northern Kentucky University.
Paul Knue, who had one of the longest tenures at both the Cincinnati and Kentucky Post among editors-in-chief, grew up in Lawrenceburg, Ind., reading The Post. He worked in Cincinnati from 1970 to 1975 as a copy editor and Weekender editor, left for Evansville, Ind., for another Scripps paper, returned as Kentucky Post editor in 1979, became Cincinnati Post editor in1983 and retired in 2001.
“We may be behind the eight-ball, but that doesn’t mean we can’t be pound for pound as good a newspaper as anybody else,” said Knue of his first years as editor here, with the JOA already in place. “We aimed for a culture that says we’re gonna work our asses off, we’re gonna kick butt, we’re gonna work harder.”
By Mick Gregory
The Times stock is nearing fire sale prices and gets a dead cat bounce to excite the Sulzbergers. Yet, who wants it?
The company has raised circulation prices at The Times and reduced third-party and non-profitable distribution, so circulation numbers falling are blamed on “management” not the content or bias. The New York Times’ quarterly dividend of 23 cents per share — a yield of 5.5 percent — amounts to a wash with real and hidden inflation at the same rate. I hope investors don’t really need the money.
Wall Street analysts have concerns about the continued weakness at The Boston Globe and the regional group is expected to keep earnings in a free fall. Additionally, there will be 12 weeks in the fourth quarter this year versus 13 weeks last year, reducing sales comparisons during the most profitable weeks of the year. So, you will see a dip in sales due to the calendar and poor performance.
Add the fact that the stock is one with an elite voting class in control by the high-living family that doesn’t have to follow the SEC stockholder protections that Sarbanes-Oxley provides for. There is no shareholder right to question the decisions of the Sulzberger famiy.
The stock is off 37 percent from its 52-week high of $26.90 set in February. Shares traded at a year-low of $16.02 last week but had a “dead cat” bounce this week of 3 percent. I predicted that the stock would dip below $18 several months ago. Now I am resetting my prediction to $14.
Then Mark Cuban should buy it and throw out the Sulzbergers. Maybe Dan Rather could be made the editor? Maybe Google’s founders are at that stage of self actualization, that they want to buy the Old Gray Lady? Nah, they are much too smart with money and innovative.
How about Gannett? They would be attacked worse than Murdoch. “How dare they!” What’s your guess?
Meanwhile, the grim reaper continues to cull the “journalistis” at every newspaper large and not so.
Here is an email an SOB editor must have spent two days writing:
11/4/07
Good evening,
As promised, I am passing along the major details of our newsroom
reorganization.
We will hold staff meetings to discuss it at 5 p.m. Wednesday for the
night staff and 11:45 a.m. Thursday for dayside.
What I am posting here is a framework mostly, dealing with staff
assignments. But that is only the first phase. We have considerable work to
do if we are going to fully realize this structure’s potential on the printed
newspaper page and online.
Among other things, we’ll need to revise all of our news protocols. And just
about every reporter on the list will have to endure what we call a “beat
clarification” process to establish topical priorities.
For now, the structure you see here will simply overlay the existing print and
online newspapers. But if we do our jobs well, within a few weeks, you’ll
begin to see real changes on the page. They will be, I sincerely hope, for the
better.
Let me say for the record, once again, with roughly 25 fewer newsroom
staffers, there will be noticeable content reductions in some areas. No
reorganization plan can change that. Some things we’ve done in the past
cannot be done.
As we’ve talked with people today, several have asked “why me” or “why
this decision instead of that.” Well, the whys for these changes ought to be
well understood by now. The San Diego Union Tribune announced a
newsroom staff reduction targeted at 10 percent today. Other papers, in just
the last few weeks, have announced similar or greater reductions. Our
overall budget reduction will be about 10 percent. After rehires, our new
staff will be about 12 to 15 percent smaller.
Absent these changes, over which the newsroom had no control, many of the
assignment changes outlined below would not have happened. Many of the
columns we killed today would have continued. Many of the restructured
departments would look unchanged.
But we had to make changes, significant changes and what is outlined here
represents our best ideas for maintaining the core of our print newspaper
while continuing to build our online presence. All of this can be second
guessed and I would guess it will be in coming weeks.
But do always keep in mind, if it doesn’t work, if it doesn’t achieve our
hoped for goals, then we’ll do something else. More than ever, we need to be
both patient and flexible. As always, my door is open to anyone who wants
to discuss these issues further.
Among the most significant changes is the creation of a new online/print
news team, sort of a journalistic skunk works. This team will be led by Carla
Savalli, our senior editor for local news who has been our chief change agent
in the last year, creating the 24/7 news desk for one thing.
Carla becomes senior editor for innovation and new content. She’ll supervise
the skunk works and also oversee our online operation.
Her team will include:
Nancy Malone — Deputy editor
Kevin Graman — Daily general assignment
To be announced – AM breaking news/general assignment
Rehire or new hire — PM breaking news/general assignment
Erica Curless – Idaho general assignment
Jim Camden — Online data base reporter
In addition, Bill Morlin, investigations and federal courts will continue to
report to Carla. Jim Camden will be giving up his Spin Control political
column. However, we’re going to develop a new political blog, similar to the
hugely successful SportsLink, where all of our public life and government
writers can post on political developments.
The innovation and new content team will flip on its end the traditional late-
in-the-day deadline structure. For this group, deadline pressure will come
early in the day as they write first for the web and then provide context and
insight for the online newspaper. They will use all of the tools at our
disposal, print, online, blogs, audio, video, etc., to tell the stories that make
our region different from any other on any given day.
The reordered city desk will be run by Addy Hatch, our current city editor.
Her deputies will include Dave Wasson, Dan Hansen and Scott Maben.
The big change in the city desk structure is the incorporation of the Business
department and staff into the city desk. We’ll continue to have a daily,
Saturday and Sunday business section, of course. But the staff will be
supervised through the city desk. Alison Boggs, the current business editor,
returns to reporting.
You’ll see that we’ve asked Shawn Vestal to return to reporting, meaning
The Falls blog will end. And Pia Hansen is giving up her column to take on
an important general assignment role. Bert Caldwell gives up his column
and returns to full-time business reporting.
That gives us this city desk lineup:
Alison Boggs – Social services/aging
Shawn Vestal – Higher education
John Stucke – Health
Jody Lawrence-Turner — Public safety
Jonathan Brunt — Spokane City/Spokane County
Sara Leaming — K-12
Richard Roessler — Olympia
Rehire – Natural resources
Karen Dorn-Steele — County/state courts
Pia Hansen — GA/personality profiles/obits
Becky Kramer – Idaho GA
Betsy Russell — Boise
Parker Howell — Business
Bert Caldwell — Business
Tom Sowa — Business/.txt
Doug Clark – Columnist
Among the newspaper’s most important initiatives is our Voices operation.
This year, we launched a weekly Voice for Post Falls/Rathdrum/Spirit Lake.
Next spring we’ll launch a new Voice for the West Plains. We also have a
twice-weekly Voice for the Spokane Valley and two weekly sections for the
city of Spokane. The Voices are among our fastest growing print section and
readership just keeps growing. Under this plan, for the first time, the Voices
will be fully staffed by full-time reporters.
Tad Brooks will continue to serve as Voices editor. Jeff Jordan is deputy
editor and Jim Allen is assistant editor. Tad and his team will assign
reporters to specific Voices. For the first time ever, a staff reporter will be
assigned to Handle extra serving Kootenai County.
The Voices staff now includes:
Nina Culver
Mike Prager
Lisa Leinberger
John Craig
Amy Cannata
Amy, our first mobile journalist (MoJo) will bring her particular expertise to
the Voices where we intend to launch a significant online initiative
sometime next year.
For those specifically interested in Idaho coverage, the breakdown is this:
Erica Curless – Idaho general assignment
Becky Kramer – Idaho General Assignment
Betsy Russell – Boise bureau and capitol coverage
To be named – Handle Extra/Post Falls Voice reporter (from the
Voices reporters listed above).
Dave Oliveria – Online and Huckleberries Online
That is a net loss of three Idaho news reporters from the pre-layoff period.
We will continue to staff the Idaho bureau office. We’ll cover Idaho preps
and University of Idaho sports out of that office and Kathy Plonka will
remain in Idaho as a staff photographer. The quantity and quality of Idaho
coverage ought to improve immediately as we get these folks in place.
Before the end of the year, we’ll launch our new Regional page where
content from Idaho and the Valley that doesn’t make one of the section
fronts will get good display.
On the Features side, the most significant change is the loss of Shadra
Beesley as 7 editor. Shadra has been a force since joining us a year or so
ago. She didn’t just caretake the 7 she inherited from Nancy Malone, she put
her own stamp on it. But Shadra is one of our most versatile editors. She will
move to the night copy desk where she will be an invaluable help in simply
putting out the paper. My thanks to her. Jim Kershner will be giving up his
longtime column in order to help boost our features reporting.
Features Editor Ken Paulman and deputy editor Rick Bonino will take on 7
as part of their regular editing responsibilities. Cheryl-Anne Milsap will
continue to edit Home, write her weekly Home Planet column and produce
our new Spokane Scene page.
The Features reporter lineup doesn’t change over much, except we did have
to accommodate for the loss of Virginia DeLeon. The staff:
Heather Lalley — Ethics, values and religion
Jim Kershner – General assignment and performing arts
Paul Turner — The Slice
Dan Webster – General assignment, books and movies
Lorie Hutson — Food/GA
Tom Bowers — 7
Som Jordan – 7
Our online operation will continue to be run by Online News Editor Ryan
Pitts who will report to Carla Savalli, but retain full responsibility for the
operation of SpokesmanReview.com and our other digital platforms. This is
a department where we took some serious hits. At one point we had lost all
three of our online producers. Here is Ryan’s lineup:
Colin Mulvaney — Multimedia coordinator
Gina Boysun — Programmer
To be hired — Programmer
Andrew Zahler — Online producer
Thuy Nguyen — Online producer
Rehire or new hire – Online producer/multimedia
Dave Oliveria — Huckleberries Online
Our night and day copy desks, now consolidated, also lost a number of key
staff members.
Geoff Pinnock retains oversight of our desk and production departments, as
well as photo, as our senior editor for design and presentation. Bertil
Peterson remains news editor. Adrian Rogers, who was deputy news editor
until taking time off to go back to school, will return as Bertil’s chief deputy.
Copy editors include:
Tom Green
Kat Smith
Ruth Reynolds
Cathy Reynolds
Katharine Kumangai
Anne LaTourneau
Mike McGarr
Shadra Beesley
Rehire or new hire
Design and art staffers include:
Ralph Walter – assistant design chief
Rick House — Copy editor/designer
Kimberly Lusk — Copy editor/designer
Molly Quinn – Artist
The Editorial Page staff includes:
Doug Floyd — Editorial page editor
Gary Crooks – Editorial page writer
Rebecca Nappi – Editorial Page writer
Lynn Swanbom — Editorial page copy editor
The editorial assistant staff includes:
Mary Beth Donelan — Administrator
Rainey Wilson — Editorial assistant
Marissa Hipp — 7 editorial assistant
Sherry Adkins — Editorial assistant
Tracy Poindexter — Editorial assistant
To be hired — Receptionist
The photo staff includes:
Larry Reisenouer — Photo editor
Liz Kishimoto – Assistant photo editor
Brian Plonka — Photographer
Dan Pelle — Photographer
Christoper Anderson — Photographer
Jesse Tinsley — Photographer
Kathy Plonka — Photographer
Bart Rayniak — Photographer
To be hired — Photographer
The Sports staff is unchanged.
Mick Gregory
The New York Times circulation fell 4.5 percent.
Here is a lesson to reporters who keep carping on “high profit margins.” There is no growth in this industry. That’s why stockholders won’t buy into your obsolete business model.
The future is bleak. There is too much competition now. Your one horse town monopolies don’t mean anything anymore in the global economy.
Circulation fell at most U.S. newspapers in the six months to September, according to statistics released on Monday that for the first time include Internet readership in a bid by publishers to boost their attractiveness to advertisers.
Average daily paid circulation for newspapers printed Monday through Friday fell 2.6 percent and Sunday circulation fell 3.5 percent for the six-month period that ended September 30, 2007, compared with the year before, according to publishers’ statistics released by the Audit Bureau of Circulations.
Most big city dailies reported that average daily paid print circulation fell. Dow Jones & Company Inc said daily circulation at The Wall Street Journal, including paid subscriptions to its Web site, dropped 1.5 percent, while The New York Times fell 4.5 percent.
Advertisers have considered print circulation key to determining where they spend their dollars, but publishers hope the Web numbers will provide a better picture of the true reach of newspapers. Editors never bothered to push for a level playing field by counting total readership as broadcast uses viewers.
“We generally agree that we can now truly gauge the impact of newspapers across the variety of media platforms that they truly represent,” said Dave Walker, chief executive of Newspaper Services of America, which buys ad space in papers.
Gannett Co Inc reported a 1 percent rise in daily paid circulation at USA Today, while the Philadelphia Inquirer said circulation rose 2.3 percent.
The Washington Post reported a 3.23 percent drop, while the Chicago Tribune fell 2.9 percent. Its parent company Tribune Co said circulation fell at Long Island, New York’s Newsday, but rose 0.5 percent at the Los Angeles Times.
The new data includes the number of people estimated to read a paper, not just how many papers were sold.
Many also are reporting usage of their Web sites, as well as a figure that tries to count print and Web site use without counting people twice who use both.
Alan Mutter, a former newspaper editor who writes a blog on newspaper and media issues called Reflections of a Newsosaur, said many newspaper Web site visitors to not remain long enough to make them worthwhile for advertisers.
“Who would work at a newspaper today, except liberal perverts… Why wouldn’t they be working as Web masters?”
–Michael Savage
Circulation fell at most U.S. newspapers in the six months leading up to September, according to statistics released on Monday from the Audit Bureau of Circulations (ABC). For the first time, the 19th century “official” verification company for newspapers includes Internet readership in last chance bid by publishers to boost their attractiveness to advertisers.
It’s always slow for the editor-centric newspaper business to catch on to common media practices let alone innovation. After all, most newspapers are run by former reporters who made their way up the ranks to management by making “scopes” and stabbing their coworkers in the back; not on actual business accomplishments or enterprise.
Sunday circulation fell nearly 5 percent.
The declines come as readers move online, but they also stem from publishers’ efforts to cut discounted copies from their subscription rolls, said a spokeswoman for the Newspaper Association of America.
Some papers, particularly in California and Florida, are dealing with the weak housing market, while others face their own regional trends, such as in Michigan where papers have cut jobs as they serve markets hurt by the slumping auto industry.
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The end of elite liberal media empires and rise of citizen journalism 