CHICAGO (AP) -- Sun-Times Media Group Inc. is considering a complete overhaul of the Chicago Sun-Times amid a continuing steep decline in advertising and circulation revenue at the city's second-largest newspaper, its chief executive said Thursday.
Gordon Paris' comments on a conference call came a day after the company, which also publishes community newspapers around Chicago, reported a $34.9 million third-quarter loss.
Paris attributed the company's 14 percent decline in overall advertising revenues largely to weakness at the Sun-Times, the largest remaining asset in the former Hollinger International Inc. media empire. He said newspaper print advertising was down about 15 percent, worse than the struggling newspaper industry as a whole.
The CEO, who is stepping down from the post Dec. 29, told analysts the company needs to go beyond the "new media" initiatives and advertising sales reorganization plan that it has already put in place to try to stem the Sun-Times' decline.
"We have begun evaluating alternatives to reposition and re-energize the Sun-Times to address the challenging market and competitive environment," he said.
Paris declined to discuss specific options being reviewed but said general areas include content, demographic targeting, marketing and branding, circulation sales and distribution.
The company said last month it had begun looking at strategic alternatives as a faster-than-anticipated decline in the newspaper market adds to its losses.
Asked about a possible sale of the entire company, Chief Financial Officer Gregory Stoklosa said, "We view all options on the table."
The Sun-Times, like other newspapers, has been losing readers and advertisers to Internet competitors. As it undergoes additional audits required by the Audit Bureau of Circulations, the newspaper did not report circulation figures for the latest six months when the rest of the industry did last month.
Paris said its circulation problems have been compounded by strong competitive moves by the Chicago Tribune, including micro-zoning of advertisements and increased distribution of the Tribune's free tabloid RedEye, from 90,000 to 150,000 copies per day.
"The Tribune's actions have involved significant investments over a number of years, a time when the Sun-Times has had to confront historical disinvestment in the business and the damaging competitive impact of circulation issues as well as unfavorable advertising trends," he said.
He declined to provide details on Sun-Times Media's announcement Wednesday that directors have found preliminary evidence the company misdated stock-option awards from 1999 through 2002. If any misdating is found to have been intentional, the company said it could require the restatement of earlier results.
Paris became CEO in November 2003 following the forced ouster of ex-newspaper tycoon Conrad Black, who is set to go to trial in March on fraud and racketeering charges for allegedly plundering millions of dollars from Hollinger.
It has been a profitable three-year stint for Paris. The company disclosed in a regulatory filing Thursday that he will get $2.7 million in severance pay.
Paris told analysts that the company has spent $136 million on legal fees and expenses since mid-2003.
Shares in the company fell 16 cents or 2.8 percent to $5.58 on the New York Stock Exchange, their lowest closing price ever.
