The Washington Post Company on Wednesday reported a sharp decline in fourth quarter profits as its newspaper and magazine divisions offset a stronger performance in its education business.
The publishing company’s earnings fell by 77 per cent last quarter compared with the same period the previous year, dragged down by $75.7m in impairment charges from writedowns of its lead generation business and community newspapers. Its net income declined from $82.9m, or $8.71 a share, the year before to $18.8m, or $2.01 a share, while revenue rose 3 per cent to $1.16bn in the quarter, driven by its businesses less reliant on print advertising.
For the year the company’s profits fell from $288.6m, or $30.19 a share, in 2007 to $65.7m, or $6.87 a share. Although revenue climbed by 7 per cent, early retirement expenses related to a wave of buyouts cost the company $111m, or $7.07 a share, last year.
The Washington Post Company’s performance has faced a tug of war between its successful education division, led by Kaplan, and its struggling newspaper and magazines. Revenues at Kaplan, which organises test preparation courses, increased by 13 per cent last quarter and were mirrored by declining newspaper revenue which fell by 13 per cent. The company’s cable television division also helped offset losses, adding subscribers and increasing fourth quarter revenue by 11 per cent.
Shares of the Washington Post Company were off on Wednesday by 0.71 per cent to close at $382.25.
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