Journal reports lower Q1 net; will spin off subsidiary
Journal Communications announced Q1 financial and a repurchase plan of up to fiveM additional shares of its class A stock. The Q1 results include the operations of three television stations whose purchased 12/5/05 and that unless otherwise indicated, all comps are to Q1 '05.
Journal said it plans to spin off its telecommunications subsidiary, Norlight Telecommunications, to its shareholders. In a statement, Journal said the spin-off, aimed at setting up two independent companies focused on their core businesses, will be completed in up to six months through a pro-rata distribution of Norlight's shares to shareholders. Norlight is expected to apply for a listing on Nasdaq.
Revenue from continuing operations increased 2.6% to 189.1M compared 184.2M. Basic and diluted earnings per share from continuing operations were 0.17 for the first quarters 2006 and 2005. In Q1, earnings from continuing operations were 12.3M compared to 12.6M, a decrease of 2.3%. Net earnings decreased 29.5% to $12.3M compared to net earnings of 17.4M. In Q1 '05, Journal recorded a 4.8M gain, net of tax, from discontinued operations related to the sale of NorthStar Print Group.
In Q1, broadcasting revenue increased 38.8% to 51.6M compared to $37.2M. Broadcasting operating earnings of 11.6M were up 115.2% compared to 5.4M, due in part to the contribution of its new television operations and the Winter Olympics.
Revenue from television stations increased 78.9% to 34.0M compared to 19.0M. In Q1, revenue from television stations and from the Winter Olympics totaled 12.7M and 3.3M, respectively. Operating earnings from television stations increased nearly fivefold to 7.8M compared to 1.6M. Excluding the new television operations, revenue increased 12.5% and operating earnings increased 125.6%.
Revenue from radio stations of 17.6M was down 3.5% compared to 18.2M. Operating earnings from radio stations of 3.8M were flat compared to last year.
For the first quarter, publishing revenue decreased 1.5% to 79.5M compared to 80.7M, reflecting, in part, the shutdown of Journal's printing plant in New Orleans. Operating earnings from publishing increased 2.5% to 7.7M compared to 7.5M.
Revenue from telecommunications decreased 12.3% to 32.8M from 37.5M due to lower prices and service disconnections. Operating earnings from telecommunications decreased 45.8% to 4.2M compared to 7.8M due to lower revenues in the wholesale business and continued competitive pressure in the enterprise business.
For the first quarter, revenue from printing services decreased 10.9% to 16.3M from 18.3M, largely due to the expected decline in revenue from Dell Computer. Operating earnings from printing services were 0.5M compared to 0.4M, reflecting the ongoing transition back to the core printing business and a continued emphasis on strict cost control.
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