Newsquest parent company Gannett Co., the largest U.S. newspaper publisher by circulation, reports earnings on Thursday, kicking off what is expected to be the ugliest quarter in recent memory for the newspaper industry, the Wall Street Journal reports.
The WSJ says: "Though there is little uncertainty about the short-term outlook, analysts and industry executives will be watching for any signs of a recovery in advertising.
"Declines in print ad revenue acceleratedthrough the end of last year, and if early returns this year offer no clearer view of a bottom, publishers could start taking more aggressive action, including closing papers or shifting operations online.
" 'We're expecting particularly dismal results from newspapers,' said Mike Simonton, an analyst with Fitch Ratings, adding that until classified ads disappear completely, there is 'no bottom in sight' for the current revenue trends."
WSJ reports: "Gannett, publisher of more than 80 U.S. dailies including USA Today, faces many of the same pressures as its competitors. Though most of its papers are profitable, profits are shrinking. The company's entire debt structure is due to mature by 2012. To alleviate pressure, Gannett last week announced a bond exchange to push out some of its maturities.
"Gannett has made some drastic cost-cutting moves at its newspapers to keep costs in line with dwindling revenue, including multiple rounds of job cuts and two furlough programs forcing employees to take unpaid leave. More changes could be in store, particularly as the outlook worsens for its flagship paper."
Story via Tom McGowran