Washington Post Co has said its third-quarter profit fell 19 per cent due to damage from Hurricane Katrina to its cable television unit as well as rising newsprint costs and weaker magazine advertising. The publisher of the Washington Post newspaper and Newsweek magazine said Friday that quarterly profit fell to $66.6 million, or $6.89 a share, compared to $82.5 million, or $8.57 a share, in the same period last year.
The company, which said its cable division had 94,000 subscribers on the Gulf Coast region, said costs from Hurricane Katrina cut operating earnings by $1.17 per share. That was partially offset by a 54 cents per share gain from the sale of securities.
Revenue rose 7 per cent from $820 million to $873.7 million, fuelled by growth at the Washington Post's education division and its newspapers. Analysts, according to Reuters Estimates, on average had forecast earnings per share of $8.01 on revenue of $889.4 million. Thomson Financial had predicted the same results.
The company said its newspaper publishing division revenue aggregated $235.5 million, up five per cent from $224.9 million in the third quarter of 2004. Operating earnings, however, fell 13 per cent on higher newsprint costs at the Post newspaper and higher pension and payroll costs.
Print advertising revenue at the Washington Post newspaper rose 3 per cent to $145.3 million in the quarter, from $140.9 million in 2004, as zoned, classified and retail advertising gains more than offset a continued drop in national and supplements advertising.
The Kaplan Education division continued to generate more revenue than the Post itself, reporting a 24 per cent gain in sales to $362.8 million. The newspaper is still losing subscribers, with daily and Sunday circulation down 3.9 per cent through the first nine months. Revenue generated by the online division, which acquired Slate earlier this year, rose 24 per cent to $19.8 million in the third quarter.
Shares in the Washington Post (down $14.00 to $756.00) fell 1.7 per cent in morning trade on the New York Stock Exchange. The stock was down 23 per cent since the start of the year compared to a 0.8 per cent rise for the Standard & Poor's 500 Index.
