Last Update: March 19 @ 7:09 PM
media
No sign of improvement in ProJo ad sales
Quarterly revenue decline of 33% is worst at A. H. Belo again
PBN FILE PHOTO / BRIAN McDONALD
THE PROVIDENCE JOURNAL’S advertising revenue has plummeted 32 percent this year compared with 2008. Sales fell 18 percent in 2008 and 7 percent in 2007.


PROVIDENCE – The relentless decline in The Providence Journal’s advertising sales worsened slightly from July through September as the newspaper’s performance continued to lag its sister publications, according to a new financial statement from its parent company.

The Journal’s advertising revenue dropped 33.1 percent in the third quarter compared with a year earlier, A. H. Belo Corp. said late Friday in its quarterly earnings filing with the Securities & Exchange Commission.

That was slightly worse than the declines of 32.5 percent and 30.5 percent at The Journal in the prior two quarters. Advertising sales made up 78 percent of The Journal’s total revenue in 2008.

The Journal’s third-quarter circulation revenue rose because of price increases, although the company did not provide specific figures. The paper’s weekday circulation fell by nearly 25,000 to 106,875 in the six-month period ended Sept. 30 compared with a year earlier, the Audit Bureau of Circulations reported last month.

The Journal’s ad revenue has been falling since at least 2007, meaning the one-third drop in the third quarter of this year is a decline from an already-lower level. Ad revenue fell 22.3 percent in last year’s third quarter and 3.8 percent in the same period of 2007.

Advertising sales continued to fall by double digits at Dallas-based A. H. Belo’s other two papers during the third quarter, though by less than at The Journal.

The Dallas Morning News saw ad revenue fell 24.5 percent, an improvement from the 30.1 percent decline in the second quarter. At The Press-Enterprise of Riverside, Calif., ad revenue fell 28.3 percent, more than the 27.6 percent drop in the second quarter.

A. H. Belo posted a net loss of $5.8 million, or 28 cents a share, in the three months ended Sept. 30. Revenue fell 17.5 percent to $126.87 million.

In all, ad revenue at The Journal was down 32 percent in the first nine months of this year, more than at The Morning News (down 27.7 percent) or The Press-Enterprise (down 26.8 percent) and nearly double the 18.4 percent decline The Journal posted last year.

Things have not turned around since the end of September, according to Alison K. Engel, A. H. Belo’s chief financial officer. In a conference call with investors on Oct. 30, Engel said that “thus far in October, there has been no significant improvement in the year-over-year percent declines of advertising revenues.”

Robert W. Decherd, A. H. Belo’s chairman, president and CEO, told investors he expects the year-over-year percentage decreases in advertising revenue will moderate in 2010 because this year’s declines have been so sharp. But he went on to say the company expects “further declines, not flat or improving revenues, in 2010.”

Decherd also said A. H. Belo does not know when The Journal’s financial picture will improve, but hopes it will happen sooner than at The Press-Enterprise, which was hit hard by the bursting of the housing bubble.

“In Providence, as you know, unemployment is very high,” Decherd said on the call. “There are things about the Providence economy and the government there that are almost intractable. But it’s also a very closely-defined marketplace, so within the market The Journal does quite well compared to other media, and is holding its own.”

Decherd added: “We would think [Providence] is going to come out before Southern California, but not by a lot.” Dallas, by contrast, is in better shape because its economy is stronger, he said.

Executives at A. H. Belo, which laid off 757 workers in the 12 months ended Sept. 30, did not outline any imminent plans for reducing expenses further, but Decherd did say the possibility of more cuts is “currently under evaluation by the management committee.”

Personnel is not the only category where A. H. Belo has reduced costs. The company said the amount of newsprint it used in the first nine months of this year totaled 54,468 metric tons, down from 85,929 metric tons in the same period of 2008.

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