Third Quarter Revenues for the Largest Publishers

I have appointed myself as the security analyst for publishers for this board. Here are the third quarter results for the largest publicly held publishers. I try to use same store comparisons when available. What that means is that, for example, Gatehouse total sales increased year over year because they bought a bunch of papers but sales at the papers they owned for the entire period declined.

Gatehouse (a.k.a. New Media Investments -6.4%
McClatchey -9.4%
Gannett -9.4%
Tronc -6.6%
Lee -6.6%

Gannett generally leads in the amount of revenue lost per quarter. I wonder how close the Gannett CEO is to getting fired.

Gannett also said they had 312,000 digital only subscribers. I counted roughly 108 Gannett papers on Wikipedia. While many of these are small this includes some big markets and USA Today. So that works out to about 3,000 digital subscribers per paper. Tronc only has 273,000 digital subscribers (ex the New York Daily News) . Digital is not working in 2017 for these chains.

In the press releases I read managements congratulated themselves on their successful cost containment efforts. I am sure they will continue these efforts. I think we all realize the personal cost to many of you.

 

Revenue declines are tolerated at this point, profit margin declines are not.

 

Good to know that on a paper to paper basis in one of those companies, we were a paper able to hit our bonus number for the quarter

 

sports sections need more original content, it's the same old same old. Maybe readers dont care about the oversaturation of sports anymore. Tired of the same old cliches and vanilla coverage.

 

It's no secret. Newspaper owners and CEOs have been playing catch-up for 15 years, and they'll never catch up now. They figured that since newspapers had survived the invention of radio, magazines, then the TV, multiple news channels and then color TV and satellite, they could survive a computer and the internet. Then they lost their asses when pages and pages of classifieds were lost on a daily basis to Ebay and Craigslist. Folks could sell their TV's or whatever way cheaper. Then they started losing readers little by little to digital platforms, and then the economic downturn of 2008-09 forced advertisers to slice their budgets, and most haven't spent on newspaper ads like they used to.

The next big thing rearing its head is Public Notices and Legal ads. Most states — who haven't done it yet — are trying to get all public notices posted online to "save the taxpayers money." Meanwhile, staffs have been gutted, papers sold, printing and design consolidated and some papers just completely folding if they can't get a buyer. The staff reduction led to overworked writers who remained and a lesser product than what readers were used to. Plus, kids these days don't read the papers while more and more traditional subscribers find their way to the Obit page. I'm glad I'm out of print for good, and I won't look back.

 

I have never read these thoughts before. This is a fresh view.

 

Gannett had an 18.9% drop in print ad revenues year over year in the third quarter so the few remaining advertisers continue to flee.

I had not heard about governments not buying legals. I worked at one time for a county government and it was a required by state law. I wondered if/when legislatures would have the courage to stand up to publishers and eliminate the requirement.

One thing I would add to your post is I think fewer traditional subscribers will make it to the Obit page. Obituaries.com is cheaper so fewer families will be willing to pay the newspaper for an obituary.

 

I can't speak for other states, but in Texas the lawmakers are pushing to have the requirement abolished. It starts with the city, school and county governments going to their local representative or senator and tell them they can post such notices online and "save the taxpayers" money (they cite declining circulations and not having to force people to buy a paper to read them). As it comes close to making it to the floor, newspapers across the state banded together to keep the bill from making it that far. So far it's worked, but how long can the newspapers win that fight?

 

Newspapers shouldn't win that fight.

 

I'm a former Gannett employee who was laid off a while ago, and obviously cancelled my half-price subscription and kept the universal digital email and password then ...

Got an offer the other day in the mail for full digital access and every day delivery of the worthless print product, for 99 cents a week for the next 6 months. Reminds me of the full-court blitz they had last Christmas time, for something like a year's digital access for $4.95 a year.

Clearly they want to whatever they can to pump up their numbers - especially digital subscriptions - to look good for the end of the year. I'm seeing lots of Gannett minions on Facebook pimping their ridiculously low prices and "local journalism" assets. Seems they want customers to care more about supporting local journalism than they care about supporting local journalism.

 

Our shop has been having trouble filling our Lifestyle section each Sunday. A big part of that is a huge decline in free "social" listings — engagements, weddings, births, anniversaries. We pulled out a 2010 bound volume and the difference in just seven years is noticeable.

We've reached the point where parents of engaged couples — or grandparents of new babies — don't read the paper themselves and don't care if announcements are listed there. They post the photo and info on Facebook.

Just one example of bread-and-butter local content that's gone away.