Newsweek Publisher’s Magazine Division Losses Widen Last Year
Washington Post Co.’s newspaper group reports profit gain in Q4.
In its fiscal year-end financial report released this week, the Washington Post Co. said its magazine division—which includes Newsweek—reported an operating loss of $29.3 million. That’s down from a $16.1 million loss during 2008. Revenues declined 27 percent to $184.2 million.
During the fourth quarter, the division reported operating income of $400,000 versus an income of $10.9 million during the same period in the prior year. Revenues for the period, meanwhile, dropped 30 percent to $52.4 million.
WPC attributed the profit slide in its magazine division to a 37 percent decline in advertising revenue at Newsweek in 2009 as well as a previously announced rate base reduction from 2.6 million to 1.5 million, resulting in subscription revenue losses. Newsweek said it also incurred a $6.6 million charge during the first quarter of 2009 associated with a voluntary early retirement program in instituted in November 2008.
In December, Newsweek agreed to sell Budget Travel magazine to an affiliate of investment advisor Fletcher Asset Management. After realizing a gain on the sale, Budget Travel incurred operating losses of $1.2 million in 2009 and $700,000 in 2008. The magazine had operating income of $2 million in the fourth quarter of 2009, compared to an operating loss of $800,000 in the same period in the prior year.
Overall, WPC reported a net income of $91.2 million for the fiscal year ended January 3, up from $65.8 million the prior fiscal year. Its newspaper division, which of course includes the Washington Post, reported an operating loss of $163.5 million in fiscal 2009 (which was made up of 53 weeks as opposed to the standard 52 weeks the prior year). That’s compared to an operating loss of $192.7 million in 2008.
During the fourth quarter, however, the newspaper division reported an operating income of $3.2 million, up from a loss of $14.4 million during the same period in 2008. Revenues for the quarter slid 4 percent to $193.3 million.