Broadcasting revenue fell 6.4% in Q4 at Journal Communications, with TV down 5.5% and radio off 7.8%. For the company’s newspapers, the drop was double-digits, off 10.4%. Journal Broadcast Group CEO Doug Kiel told analysts that visibility for both radio and television is cloudy, with business being booked late. The company is looking for Q1 ad sales to be down, but isn’t making any specific projections.
“The overall economic environment and continued deterioration of advertising expenditures in Journal markets impacted our business in the fourth quarter causing lower revenue across all segments,” said CEO Steven Smith. “Fourth quarter total publishing revenue was off just over 10% and total broadcast revenue was off just over 6%. Overall Journal Communications revenue decreased 9.0% in the quarter and 6.5% in 2008. To date in the first quarter, we continue to see revenue declines across all of our businesses,” he added.
Journal has been cutting costs, with the workforce reduction in 2008 put at 11.7% for radio and 12.1% for TV. The company recently slashed its dividend payment and isn’t ruling out the possibility of a complete dividend suspension. Executive salaries have been frozen and the 401(k) match suspended. When one investor complained about stock grants to employees, Smith noted that the senior executive staff is not eligible for the stock incentive program this year. Any excess cash on hand resulting from the savings will be used to further pay down debt.
Like so many media companies, Journal had to write down the value of its intangible assets to reflect current market values. That was a $336.3 million non-cash charge in Q4 for impairment of goodwill and broadcast licenses. The company also had a $1.2 million one-time charge for workforce reduction costs. Those charges resulted in the company posting a net loss of $223 million in Q4. Excluding those charges, operating earnings were $12.6 million.
Q4 broadcast revenues dropped 6.4% to $53.1 million, including $6.7 million of political. TV group revenues declined 5.5% to $33.4 million. Radio group revenues declined 7.8% to $19.7 million.
Publishing revenues fell 10.4% in Q4 to $60 million, with weakness reported across all ad categories.
Journal also issued what is to be its last monthly revenue report. The company said it will now give only quarterly updates. December radio revenues declined 8.9% to $7.2 million. TV fell 21% to $9.7 million. Print ad revenues fell 13.4% to $15.5 million, with classified down 30.5%, national 20.9% and retail 4.1%