Gannett 2Q report: Profits up; ads down

Gannett Co. reported higher second-quarter profits yesterday thanks to the sale of several newspapers. The largest newspaper publisher in the country (which locally includes Pensacola News Journal, Pensacola  Business Journal, Home & Garden, Bella, Pelican and GoSport)  posted net earnings of $365.7 million or $1.56 per share for the three months ending in June, versus $310.5 million or $1.31 per share in the same period a year earlier.

However, excluding a $73.8 million gain from the sale of several newspapers and earnings from discontinued operations in both periods, Gannett earned $289.9 million from continuing operations in the quarter, down 4.8 percent from $304.5 million in the same period a year earlier.

Newspaper advertising revenues of its U.S. papers fell 7.7 percent in the quarter – partly due to a slowdown in real estate in several of its markets, a category that had been very strong a year ago.

According to AP:

The slump in Gannett’s newspaper results is part of a broader decline in advertising across the industry which has been accelerating in recent months. Readers and the advertising dollars that chase them are increasingly turning to the Internet for news, information and entertainment.

“We see no signs that a turnaround in newspapers is anywhere on the horizon,” Morgan Stanley analyst Lisa Monaco told investors in a note Wednesday, adding that after seeing the second-quarter results, she is further convinced that Gannett and the industry overall will “continue to lose share to new media for the foreseeable future.”