Gannett just filed its second-quarter 10-Q report with the U.S. Securities and Exchange Commission, a document rich with details -- except when they aren't there. See if you can find the financial information about USA Today in the first-quarter's 10-Q that isn't included in the second quarter's.
Here's the relevant text from the first-quarter 10-Q, filed on May 4:
"National advertising revenues declined 3% for the quarter. National advertising revenues increased 8% in the U.S. Community Publishing group and were up 2% in the UK in local currency for the quarter. Ad revenue at USA TODAY, including USATODAY.com, was down 11% for the quarter. Advertising demand at USA TODAY continues to be impacted by the soft travel and lodging markets. Several categories at USA TODAY improved during the quarter including automotive, technology and retail. These revenue gains, however, were more than offset by weakness in the travel, entertainment, financial, telecommunications and pharmaceutical categories."
Now, here's the text from the second-quarter 10-Q, filed today:
"National advertising revenues declined 4% for the quarter and year-to-date period. Domestically, national advertising revenues decreased 2% for the quarter and 3% year-to-date due to lower results at USA TODAY, partially offset by a double-digit increase in national advertising at U.S. Community Publishing. Advertising demand at USA TODAY continues to be impacted by softness in the travel-related categories. The automotive, retail and packaged goods categories improved during the quarter at USA TODAY while the entertainment, travel, telecommunications and pharmaceutical categories lagged last year. Paid advertising pages at USA TODAY totaled 580 compared with 602 in last year’s second quarter."
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Friday, July 30, 2010
12 comments:
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Oh, that wiley Martore.
ReplyDeleteWOW. USAT looks really sick, losing ad pages even compared to last year at the worst part of the recession. Guess that explains Hunke's reorganization scheme.
ReplyDeleteCuriously, it appears that the ad revenue figure was withheld in this 10-Q.
ReplyDeleteJim, here's what you should be highlighting from the report:
ReplyDeleteFor the first six months of 2010, the Company’s long-term debt was reduced by $432 million, reflecting repayments of borrowings under the revolving credit agreements using cash flow from operations. At the end of the second quarter, the Company’s total long term debt was $2.6 billion. The Company’s senior leverage ratio was 2.10x as of June 27, 2010, which is substantially below the senior leverage ratio of 3.5x the Company is required to maintain under its revolving credit agreements and term loan agreement.
That is a tremendous positive development for Gannett's long-term strength.
9:39 pm: Agreed!
ReplyDeleteThey don't have much of a choice than pay down the debt. GCI is the most heavily indebted of America's newspaper chains, and is facing a 2012 deadline to pay back the remaining $2.6 billion. Remember that Gracia a couple of years ago attempted to stretch out this deadline, and was rejected by the market. Bankers aren't about to underwrite a failing business where revenues are declining.
ReplyDeleteBottom line: they have to pay down the debt because there's a gun at their heads, and it goes off in two years. So there will be two more years of austerity and squeezing.
It is hardly anything to congratulate them about.
This was why they cut the dividend 90%, froze the pension, and eliminated 11,000 jobs mostly through layoffs since 2008. The later two steps were part if the justification given by the board for awarding bonuses to Dubow & Co.
ReplyDelete10:03 ... You're using old math. The current debt due by 2012 is $1.9 billion. If Gannett keeps paying off the debt at roughly the same rate it is now, that 1.9 billion will be paid by the time it's due in 2012.
ReplyDeleteJim is right, too. This is why all the cost cutting happened. It wasn't to support daily operations -- Gannett is still quite profitable in that area. It was to take care of long-term debt, the kind of thing companies like Tribune and McClatchy didn't take care of.
Bottom line: Gannett is acting fiscally responsible when it comes to debt. Don't believe all the blog hype.
Less revenue means less money to pay off the debts, so in order to keep up these debt repayments, there will have to be even more payroll cuts and consolidations. It is a death spiral of cuts leading to even more cuts, producing less revenue, which leads to even more cuts.
ReplyDeleteShowering top executives with millions of dollars in bonuses over the past two years doesn't sound fiscally responsible to me.
ReplyDeleteHey, 10:43 a.m., are we to cheer for corporate that its paying down the debt on the backs of employees, many of them seriously harmed by layoffs and frozen pensions?
ReplyDeleteAnd am I reading Jim correctly that the board gave Dubow and Co. bonuses because they froze the pension plan and cut over 10,000 people?
What a disgrace. They screwed up, and everyone pays except them!
In other words, they were being fiscally responsible and morally reprehensible at the same time. That doesn't take much talent.
ReplyDelete