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That's a net loss for the third quarter and compares with net income of $152.8 million a year earlier. The parent company of the LAT reported a 19 percent drop in ad revenue at its publishing division. No breakout on specific papers, but the L.A. market has been cited as being especially vulnerable - largely because of classified advertising declines (real estate, autos, help wanted). Overall, publishing's third quarter operating revenues for the quarter were $654 million. "We are operating in an exceptionally difficult financial and economic environment," Tribune CEO Sam Zell said in a statement. One expense jumps out: A charge of $45 million for severance and special termination benefits, compared with $4 million a year earlier. To highlight the glum news in the publishing group:
-Retail ad revenues fell 10 percent, due to declines in the furniture/home furnishings, hardware/home improvement stores, department stores, specialty merchandise and other retail categories (preprint revenues fell 15 percent).
-National ad revenues fell 21 percent, due to decreases in the movies, telecom/wireless, auto, media, and transportation sectors.
-Classified ad revenues fell 30 percent (real estate down 44 percent, help wanted revenues 37 percent and auto 11 percent).
-Interactive revenues (included in the above categories) fell 7 percent, due to a decline in classified advertising.
Here's more from the release:
Interest expense related to continuing operations increased to $232 million in the 2008 third quarter from $175 million in the third quarter of 2007 primarily due to higher debt levels, partially offset by lower interest rates. The Company allocated interest expense of $3 million and $12 million in the third quarters of 2008 and 2007, respectively, to discontinued operations. Debt was $11.8 billion at the end of the 2008 third quarter and $9.4 billion at the end of the 2007 third quarter. The increase was primarily due to financing the going-private transaction completed in the fourth quarter of 2007.
One more troubling number: Operating cash flow decreased 67 percent to $90 million from $268 million in the 2007 quarter. Maintaining adequate cash flow is especially critical for Tribune because that's what will be required to pare down debt. In some ways, the cash flow numbers are more important than the actual bottom line.
Mark Lacter created the LA Biz Observed blog in 2006. He posted
until the day before his death on Nov. 13, 2013.