Gannett, the US parent company of Newsquest in the UK, has today reported a first-quarter profit that was double its earnings a year ago and said that U.S. newspaper advertising, down 8.5% year-on-year, showed improvement in every category, Editor & Publisher reports. E&P claims the results are more evidence of a turnaround in the fortunes of newspapers. Gannett chairman and chief executive officer Craig A. Dubow said in a statement:"“We achieved very strong results for the quarter. All of our business segments delivered substantially higher operating income and operating cash flow in the quarter. We more than doubled adjusted net income despite lower revenues and reduced our debt by approximately $260 million in the quarter. “The momentum we had at the end of last year continued through the first quarter. Revenue trend comparisons improved in the quarter reflecting the positive impact healthier economies in the U.S. and the UK had on advertising demand as well as advertising revenue associated with the Winter Olympic Games. "We also benefited from significantly lower costs due to greater efficiencies and substantially lower newsprint expense. We are well positioned for continued growth as the economy improves and we are extremely encouraged by the revenue trends and our ability to create and capture operating leverage.
He added: “Earlier this week, we were pleased to join eleven other major media companies in announcing plans to form a standalone joint venture to develop a new national mobile content and distribution service to make mobile digital television universally available to consumers.” Net income was $119.4 million, more than doubling the $57.0 million generated in the first quarter last year. E&P says: "As newspapers have reported in the past several quarters, Gannett profit was built on continued cost-cutting." The company said its operating expenses, adjusted for special items, fell 11.3% to $141.3 million. Gannett pointed to improvements in advertising revenue. It said classified advertising was 14.0 percentage points better than the fourth quarter comparison. Retail was better by 9.3 percentage points and national by 7.9 percentage points.
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