Three Publishers Post Increased Earnings
Meredith Corp., the McGraw-Hill Cos. and the Reader’s Digest Association all posted increased earnings reports this week.
Meredith Corp., publisher of Better Homes and Gardens, Family Circle and other magazines, reported that its net earnings in the second quarter of its fiscal year, which ended December 31, increased 20 percent to $35 million. Revenues for the quarter were up 5 percent to $406 million, which included advertising revenue growth of 8 percent bolstered by strong performance at the company’s television stations.
For the first six months of the year, Meredith’s earnings increased 18 percent from a year ago to $66 million. Revenue increased 3 percent to $802 million with advertising revenues up 7 percent to $496 million.
Operating profit for Meredith’s publishing division was $33.2 million for the second quarter, down from $37.2 million a year earlier. Revenue was $300.1 million for the quarter, down from $301.4 million in the same period in 2005. Operating profit for the first six months of the year was $81.6 million, down from $84.9 million a year ago. Revenues for the first six months were $613.8 million, down from $619.9 million.
But the publishing’s online advertising revenue grew 30 percent in the second quarter. Meredith expects online advertising revenue to continue growing due to a planned redesign and expansion of Better Homes and Gardens Web site, BHG.com and the creation of a parenthood portal – both of which will debut in the spring.
Reader’s Digest Association said its revenues increased in the second quarter of its fiscal year to $802 million compared to $765 million in the same period a year ago. Operating profits were $114 million for the quarter compared to a loss of $76 million a year earlier. The company’s net income was also up, increasing to $62 million compared to a loss of $122 million in the prior year.
Reader’s Digest said its second quarter earnings included the $6 million loss it took on the sale American Woodworker as well as $5 million in costs related to its upcoming merger with an investment group led by Ripplewood Holdings. Increased revenues for the quarter were attributed to improved sales at Reader’s Digest North America and Reader’s Digest International, but were partially offset by lower sales at Consumer Business Services.
The McGraw-Hill Cos. reported a net income increase in the fourth quarter of 2006 of 8.2 percent to $204 million. Its revenue grew by 3.4 percent to $1.6 billion. For the full-year, the company posted a 4.5 percent increase in net income to $882.2 million and increase in revenue of 4.2 percent to $6.3 billion.
The company attributed its strong performance to "effective cost controls in a softening education market." The company’s education market decreased 5.5 percent for the full-year to $2.5 billion. Full-year revenue in the company’s business-to-business group, which includes Businessweek, Platts, McGraw-Hill Construction and Aviation Week, increased by 5.5 percent to $864 million. The segment’s fourth quarter revenue, however, declined 10 percent to $238.6 million.