Acquisitions pushed Media News Group’s earnings into the black despite a tough advertising market, according to a fiscal third-quarter earnings report the Denver-based publisher filed Tuesday.
MediaNews, owner of The Denver Post, reported net income of $4.3 million in its January-to-March quarter versus a loss of $3.6 million in the same period in 2006.
Revenues during the quarter rose to $317 million, a 52.7 percent increase from $208.4 million during the same period a year earlier.
A string of acquisitions and management agreements starting last summer, however, complicates any quarter-to-quarter comparison.
“There is a lot of noise in the numbers,” said Joseph Lodovic, president of MediaNews.
Last August, MediaNews and its partners purchased the Contra Costa (Calif.) Times and the San Jose (Calif.) Mercury News from McClatchy Co. In February, it bought the Santa Cruz (Calif.) Sentinel.
MediaNews also began reporting the results of The Monterey County (Calif.) Herald, the St. Paul (Minn.) Pioneer Press and other newspapers on its financial statements after reaching a management accord with Hearst.
Adjusting for those changes, advertising revenues declined 8.7 percent in the quarter and circulation revenues fell by 7.6 percent.
“It was a tough quarter,” Lodovic said. “We, along with the industry, are navigating through a lot of change.”
A deepening housing slump cut into real-estate ads, which until recent months had shored up weakness in automotive and employment ads. Internet ads were the only positive category, growing 9.9 percent in the quarter, adjusting for acquisitions.
Advertising weakness was especially evident in Denver, where the company splits proceeds from a joint operating agreement with Cincinnati- based E.W. Scripps, owner of the Rocky Mountain News.
The Denver JOA lost $3.9 million on revenues of $85.7 million in the January-to-March quarter, compared with income of $2.3 million on revenues of $98.3 million in the same quarter of 2006.
The Denver Post extended voluntary buyout offers to about 90 newsroom workers last month, with a targeted reduction of 37. Layoffs could follow if sufficient savings aren’t realized through the buyout program.
MediaNews owns 61 daily newspapers and 120 nondaily publications.
Staff writer Aldo Svaldi can be reached at 303-954-1410 or asvaldi@denverpost.com.
