Gannett Beats Q3 Earnings Estimates With Help From Olympics And Political Ads

Television stations were the star performers for Gannett, helping to overcome weak results in its core newspaper business to edge past Wall Street’s expectations for Q3. The company reported net income of $148.6M, up 32.9% vs the period last year, on revenues of $1.31B, +3.4%. Revenues were slightly ahead of the $1.29B that analysts anticipated. And earnings, excluding unusual events, came in at 56 cents a share — beating the 53 cents that company watchers forecast. The largest independent owner of NBC affiliates says it benefited from $37M in ad sales related to the Summer Olympics in London, $41.7M in political ads, and $22.3M in retransmission consent payments from pay TV distributors. All told, the Broadcasting division generated $237.0M in revenues (+36%) with operating income of $118.7M (+73.1%). Gannett needed the boost: Revenues at its Publishing division, which includes USA Today, fell 3% to $890.2M, with operating income of $73.7M, down 31.7%. Ad sales at the U.S. publishing operations dropped 6.%%; with the 7.4% decline at UK-based Newsquest they were down 6.6% to $552.7M. Employment and real estate ads were especially weak in the U.S. although auto-related sales were up 1.3%. Meanwhile, Gannett’s Digital segment — which includes CareerBuilder — saw a 4.7% increase in revenues, to $182.0M while operating income rose 16.2% to $34.4M. “Our results this quarter demonstrate that the growth strategy we announced in February is gaining traction,” CEO Gracia Martore says. “In September we re-launched our flagship USA Today brand, which has been re-imagined and redesigned for today’s consumers and advertisers. We are seeing early successes and making great progress in positioning Gannett for growth in the digital era.”

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