Increased retransmission consent revenue wasn’t enough to offset an across-the-board drop in ad revenue and lack of political money.
Journal Communications Inc. today announced results for its first quarter ended March 29. Its broadcasting segment revenue decreased 20.5% to $39.2 million compared to $49.4 million led by decreases in local advertising revenue of 18.3% and national advertising revenue of 27.3%.
Total broadcast political and issue advertising revenue was $0.1 million compared to $1.9 million. Retransmission revenue was $1.3 million compared to $0.3 million. Broadcasting operating earnings of $0.9 million decreased 88% compared to $7.1 million.
Revenue from television stations for the first quarter decreased 19.8% to $26.0 million compared to $32.4 million. Television political and issue advertising revenue was essentially zero compared to $1.7 million.
Operating earnings from television stations of $0.1 million decreased 98.1% compared to $3.6 million. Television operating expenses (including KWBA Tucson, Ariz. that was acquired in July 2008) are down 9.9% compared to last year primarily due to the reduction in payroll related costs.
For the first quarter, revenue from radio stations of $13.2 million was down 21.9% compared to $17.0 million. Operating earnings from radio stations of $0.8 million decreased 77.5% compared to $3.5 million, largely reflecting the declines in revenue partially offset by a 7.5% decrease in radio operating expenses primarily due to the reduction in payroll related costs.
“The difficult economic environment and continuation of reduced advertising spending across all of our local markets impacted our revenue in the first quarter,” said Steven J. Smith, chairman-CEO of Journal Communications.
“We continue to be focused on finding additional efficiencies in our businesses, as well as driving revenue initiatives,” he added. “We anticipate that the economic challenges we are facing today will persist into the second quarter and throughout 2009; therefore, initiatives like our 6% across-the-board compensation reductions are difficult but necessary measures.
“We reduced total operating expense by over $14 million in the quarter. We also used the cash generated by our businesses to pay down debt. Total outstanding debt is down by approximately $15 million compared to 2008 year end.”