Gannett's Q2 Profits Down 4.5%

15 July 2005

The Gannett Company, America's largest newspaper publisher and occupant of the number two slot in the United Kingdom, reported Wednesday that Q2 profits were down by 4.5%, citing higher costs and lower ad revenues at its flagship newspaper, USA Today and its twenty-one TV stations.

Net income dropped to $338.6 million (€280m; £193m) from $354.4m a year earlier, although earnings matched analysts' estimates. The Q2 profit drop was the second southbound result after four years of gains. Sales rose 3.4% to $1.94 billion.

In his valedictory statement chairman/president/ceo Douglas H McCorkindale, who retires this month, said: "We are pleased to announce another quarter of operating revenue and earnings per share growth despite the challenges faced by our UK and broadcasting operations.

"Our U.S. newspapers produced industry leading ad revenue growth, benefiting from growth in local and employment classified advertising.

"Our operations in the United Kingdom lagged last year's results as advertising demand was impacted by the slowdown in the UK economy.

"Broadcasting's results were affected by a much lower level of political advertising and softer ad demand, particularly in automotive."

Data sourced from New York Times; additional content by WARC staff