Tribune Co. earns 71 cents a share after loss

Newsprint costs fell, TV ad demand climbed, says publisher of The Sun

October 18, 2002|By BLOOMBERG NEWS

CHICAGO - Tribune Co., publisher of The Sun, said yesterday that it made a third-quarter profit as newsprint costs fell and demand for advertising at its television stations rose.

Net income was $236.8 million, or 71 cents a share, compared with a loss of $138.9 million, or 49 cents a share, in the third quarter last year, Tribune said in a statement.

Revenue at the second-biggest U.S. newspaper publisher by sales rose 5.1 percent to $1.34 billion.

Publishing revenue rose 2% to $927 million. Broadcasting and entertainment jumped 11% to $394 million, and television revenue increased 13% to $310 million.

Publishing companies that own television stations and cable networks, such as E.W. Scripps Co., have said that their third-quarter results were buoyed by an increases in political and automobile advertising.

"This looks like the standout performer in the media industry," said Edward Atorino, an analyst at Blaylock & Partners who has a "hold" rating on Tribune shares but doesn't own the stock.

"There is a surprising surge in TV advertising. Prices are strong and the money is spilling in from big advertisers like pharmaceutical" companies, he said.

A 26 percent decline in the cost of newsprint and ink helped Tribune compensate for a slump in help-wanted ads, which fell 20 percent.

Newspaper publishers have suffered from a drop in employment advertising due to the faltering U.S. economy, particularly since the terrorist attacks of Sept. 11.

Shares of Tribune fell 62 cents yesterday to close at $46.50 on the New York Stock Exchange. They had risen 26 percent this year.

Higher expenses for newsprint, television programming, and employee medical insurance could cut into sales in the fourth quarter and the first part of next year, Donald C. Grenesko, senior vice president of finance, said during a conference call.

Tribune said it expects to earn 46 cents to 56 cents a share in the fourth quarter.

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