RICHMOND, Va. – Media General Inc. (NYSE: MEG), the parent of local television station WJAR-NBC Channel 10, today posted a preliminary second-quarter loss of $129,000, compared with a year-ago profit of $5.12 million, on revenue that fell 10.2 percent compared with the 2007 second quarter to $204.86 million.

Per diluted common share, the newspaper and broadcasting company posted a net loss of 1 cent – after severance charges that amounted to 14 cents per share – compared with a year-ago gain of 22 cents.

Second-quarter losses from continuing operations amounted to $1.37 million, or 6 cents per diluted share, compared with the year-ago gain of 19 cents. On discontinued operations, the company posted a gain of $1.24 million, or 5 cents per share, a 54.1-percent increase from the 2007 second quarter.

The company is still calculating a non-cash impairment charge “primarily of goodwill and intangible assets” it expects will reach $500 million to $550 million after taxes. That charge “will reduce the book value of goodwill, identifiable intangible assets, and certain other assets,” Media General said today.

“We determined that, in view of the continued economic slowdown and the market’s perception of media-industry equity valuations, this was the appropriate time to undertake the impairment testing,” Marshall N. Morton, the company’s president and CEO, said in a statement today. “The charge is non-cash and will not impact our ability to operate, reduce debt or move forward with our ongoing transition to the digital world.”

The weak second-quarter results reflect “a weakening economy and a continued challenging business environment in the Publishing Division,” Morton said. “Partially mitigating lower divisional results … were lower interest expense and an additional gain related to the Richmond Times-Dispatch fire settlement.”

The Publishing Division’s second-quarter profit fell 69.9 percent to $6.8 million, as total revenue fell 14.7 percent and newspaper advertising revenue fell 17.1 percent, the company said. Excluding the ailing Florida operations, however, the division’s profit fell less than 10 percent.

Broadcast Division profit fell 17.2 percent to $14.9 million, on total revenue that fell 5.7 percent. Gross time sales fell $4.5 million, or 5 percent; local time sales fell $1.2 million, or 2.2 percent; and national time sales fell $5.3 million, or 15.9 percent. Political ad revenue nearly quadrupled to $2.8 million from the 2007 second quarter’s $745,000, boosted by the presidential race and several key gubernatorial and congressional races.

The Interactive Media division posted a divisional loss of $656,000 compared with its first-quarter loss of $2.7 million and year-ago profit of $359,000, the company said. Revenue rose 13.7 percent year-over-year to $10.6 million, reflecting local advertising and revenue from DealTaker.com, which the company acquired on March 31. Media General’s partnership with Yahoo!HotJobs generated revenue of $2 million, helping offset a decline in classified ads. Local revenue rose, on “continued growth in banners and sponsorships and direct sales,” while national and regional ads fell “7.1 percent, due to softer advertising from national agencies, particularly at TBO.com in Tampa,” the company said. Page views rose 6.1 percent year-over-year.

Interest expenses remained a major factor for Media General, amounting to $10.55 million in the second quarter, or 30.5 percent less than a year ago. The company attributed the decline to “lower interest rates … aided by lower debt levels.”

The company yesterday completed its sale of two TV stations – ABC affiliate WMBB in Panama City, Fla., and NBC/CBS station KALB/NALB in Alexandria, La. – as part of its plan to continue paying down outstanding debt. “We are pleased to complete the sale of the second and third of five stations we are divesting,” Morton said in announcing the closings. “We will use the proceeds immediately for debt reduction.” Financial details are being withheld pending the completion of all five transactions.

Meanwhile, Morton said today, “We continue to implement aggressive performance-improvement actions – including work-force reductions – to better align expenses with current business conditions. Total operating costs in the second quarter, excluding severance charges, decreased approximately 6 percent.”

Media General’s economy measures will include the elimination of up to seven jobs, or 11 percent of the work force, at Channel 10 in Cranston, the local station said in May. (READ MORE)

Media General Inc. (NYSE: MEG) is the owner of 20 network TV television stations – including Cranston-based WJAR-NBC Channel 10, which it bought from NBC Universal in 2006 – plus 25 daily and about 275 weekly newspapers and other publications, mostly in the Southeast. Additional information is available at www.mediageneral.com.