Primedia Posts Flat 2006 Earnings, Revenue Flat for Unit It Hopes to Sell
Primedia this week posted essentially flat fourth quarter and full-year 2006 earnings and revenue for its Enthusiast Media segment, which is for sale, according to an 8K document filed with the Securities and Exchange Commission. The enthusiast group had total revenues of $130.3 million for the fourth quarter of 2006, up slightly from $128.7 million in the fourth quarter of 2005. Full-year revenues were $524.8 million, up 4 percent from $504.6 million in 2005.
EBITDA for enthusiast group, home to 70 magazines including three purchased last month, was $25.3 million in the fourth quarter of last year, compared to $25.9 million in the same period in 2005. EBITDA for the full year was down 0.7 percent to $97.4 million, from $98.1 million in 2005.
The company attributed the decreases in EBITDA in the fourth quarter and full-year 2006 to $2.2 million in cash and $3.8 million in non-cash compensation paid last year to the CEO of Automotive.com, which Primedia bought an 80 percent stake in, in November 2005.
Primedia last month said it has hired Goldman Sachs and Lehman Brothers to manage the sale of the enthusiast group, leading some to speculate that the segment could be sold in pieces. The company spent the better part of last year selling off segments of itself including its crafts group, which went to Sandler Capital Management for $132 million; its gems group, which went to Interweave Press for an undisclosed price; and the hunting, fishing and shooting assets from its outdoors group to Intermedia Partners for $170 million.
Several sources said a first-round bid date has not yet been established for the enthusiast group’s sale. Although bidders have not yet made their intentions known, Apprise Media CEO Charles McCurdy, a founder of Primedia, is said to be interested in the titles. Primedia declared its Education segment discontinued in the fourth quarter and is exploring "strategic options" for that segment, as well.
Primedia’s Consumer Guides, a publisher and distributor of free real estate sales and rental guides, posted revenues of $324.5 million, an increase of 2.3 percent over 2005 revenues of $317.1 million. Its EBITDA in 2006 was $81.3 million, up 8.5 percent from $74.9 million in 2005.
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Source: Primedia 8K filing