The New York Times Company (NYTCO) announced Tuesday updated full-year 2005 guidance and its outlook for 2006. Later this month, the company plans to provide earnings guidance on the fourth quarter of 2005.
NYTCO also announced Tuesday that in November 2005 advertising revenues for the company's business units increased 5.8 per cent and total company revenues increased 3.1 per cent compared to November 2004. The increase in advertising revenues was the highest rate of growth since the beginning of the year. Excluding About.com, which was acquired in March 2005, advertising revenues increased 3.2 per cent and total company revenues increased 1.2 per cent.
"The media marketplace has been challenging in 2005 and we expect it will continue to be next year," said Janet L. Robinson, president and chief executive officer, said in a release. "To address the issues that we face and to take advantage of opportunities we see, we have aggressively strengthened our print, online and broadcast platforms as demonstrated by the acquisitions of About.com and KAUT-TV, as well as our investment in Metro Boston.
"We continue to develop innovative, new products that target specific audiences at both our traditional and online properties and to provide advertising solutions across our platforms. We also remain very committed to operating more efficiently and using technology to decrease expenses. The combined effect of all of these actions will benefit us in 2006."
Given the limited visibility on advertising in 2006, NYTCO is not providing an expected range for earnings, revenue growth or expense growth.
In 2006, the company's financial statements will include an extra week. Since the company has a fiscal year that equalises the number of Sundays, every fifth year has an extra week. In the fourth quarter of 2006, there will be 14 weeks rather than 13.
Across all of NYTCO's newspaper properties, the company expects that revenues will benefit from higher advertising rates in 2006. At the New York Times, projected rates will rise about 5 per cent, and at the Globe and the company's Regional Media Group, it expects an increase of about 3 per cent.
The Broadcast Media Group results will have a full year of revenues for KAUT-TV, which was acquired in November. KAUT-TV is expected to have total 2005 revenues of about $5.7 million. In 2006, the stations are expected to benefit from mid-term elections and the Olympics.
NYTCO also expects that all of its digital properties will continue to experience very strong revenue growth. The release said that the company will have a full year of revenue from About.com, which is expected to have strong double-digit revenue and operating profit growth. The company expects little or no dilution from About.com.
Meanwhile, advertising revenues for the New York Times Media Group increased 5 per cent. National advertising revenues increased as strength in advocacy, financial services, hotel, hospital and transportation/travel advertising offset weakness in the studio entertainment, American fashion and pharmaceutical categories. Retail advertising revenues increased on growth in mass market advertising. Classified advertising revenues rose as gains in real estate advertising offset softness in help-wanted and automotive advertising.
Advertising revenues for the New England Media Group decreased 2.2 per cent. National advertising revenues increased as strength in banking, health care and other corporate advertising offset weakness in entertainment, travel and national automotive advertising. Retail advertising revenues decreased largely because of softness in department store and home-related advertising. Classified advertising revenues were lower as weakness in automotive advertising offset growth in real estate and help-wanted advertising.
The company said that advertising revenues for the Regional Media Group rose 5.2 per cent. Excluding the North Bay Business Journal, which was acquired in February 2005, advertising revenues grew 4.8 per cent. Retail advertising revenues decreased as softness in telecommunications and department stores advertising offset growth in the home improvement, medical/hospital and mass markets categories. Classified advertising revenues increased as gains in help-wanted and real estate advertising offset weakness in automotive advertising.
Internet ad revenues included in the three media groups increased 30.5 per cent due to strong growth in display advertising and in all classified advertising categories. Year-to-date Internet ad revenues grew 29.4 per cent.
TimesSelect, the new fee-based product on NYTimes.com that includes the New York Times's distinctive columnists and extensive access to its archives as well as other features, currently has 330,000 subscribers.
Circulation revenues for November decreased 2 per cent. Circulation revenues increased at the Regional Media Group, and declined at the New York Times Media Group and the New England Media Group.
About.com continued to show strong advertising revenue growth as a result of increased spending in the financial, retail and health care categories. Gains were also achieved in technology, telecommunications, consumer packaged goods and travel advertising. Advertising revenues for About.com, which was acquired in March 2005, increased approximately 48 per cent in November and 46 per cent year to date.
