Lee expects revenue to decline

In a forecast report filed with the SEC, Lee Enterprises says its revenue will continue to improve in the first quarter, which ends Dec. 26, and its total operating revenue will drop 1 percent compared to a year ago.

Lee's losses continue in third quarter

Lee Enterprises posted its third quarter earnings on July 20. Revenue fell 3.6 percent, which CEO Mary Junck called "positive momentum."

The report shows $10 million in earnings, but Junck failed to mention that figure is greatly boosted by cuts made to employee benefits at the St. Louis Post-Dispatch, layoffs at several other papers and nearly across the board unpaid furloughs.

Lee's fiscal year ends in September, the same time the no-layoff guarantee at the Post-Dispatch ends. The company must pay back its debts from the 2005 Pulitzer acquisition in 2012.

Editor's note: An unexpected and important family obligation has kept me away from this blog for some time; my apologies. I make no promises, but hope to get back on a regular blogging schedule. Thanks to all for the e-mails, tips, links and comments. Tips are always welcome: lee.ent.watch@gmail.com.

Lee posts 2Q profit

On the heels of furlough, layoff and pay cut announcements, Lee Enterprises announced Tuesday that it is making money.

Total revenue was $185.7 million. Operating expenses and compensation costs (part of that furlough, layoff and pay cut plan) also are down. Add it up, and Lee reported a profit of $3 million for the second quarter; this is the company's third consecutive profitable quarter.

• Editor & Publisher story
• Associated Press story
• Lee's financial release

Lee papers don't report company's revenue loss

At its shareholder meeting earlier this week, Lee announced its revenue in January fell 9.2 percent from the previous year.

If you already knew that, it probably wasn't from reading a Lee newspaper.

It looks like the Quad-City Times in Davenport, Iowa, wrote the official story on the shareholder meeting, which never mentions the loss in revenue. Reading the story, one would think Lee's revenue has increased.

Read it for yourself. Here it is in the:
Quad-City Times
The Chippewa Herald
The Pantagraph
Sioux City Journal
St. Louis Post-Dispatch
Times of Northwest Indiana

Have you seen the same story (or a slightly edited version) on other Lee websites? Post a link in the comments, or send me an e-mail and I'll add it to the list.

Earnings down 'only' 9.2 percent

Lee's revenue continues to slide: January total revenue fell 9.2 percent from the previous year. At the annual stockholder meeting, CFO Carl Schmidt said he expects the "improvement" to continue in February and March.

In the second quarter, which ends in March, Lee expects operating costs to fall by 9 percent. No details on cost-cutting measures, but compensation costs have fallen 19.6 percent from 2008 to 2009. The opening slide in the stockholder slideshow said "We continue to generate substantial cash flow in a difficult economy."

CEO Mary Junck told stockholders that Lee's papers and websites reach up to three-fourths of adults over a week in their markets.

"In a time of rapidly evolving digital interactivity, our newspapers and online sites remain in front, by far, surpassing all print, broadcast and online competitors as the primary source for local news, information and advertising in our communities," she said. "Without us, most local news would never come to light."

Schmidt also said the company paid down $198 million of debt in 2009.

Read Lee's statement on its earnings report, and see the 31-page slideshow (PDF).

Lee reports profit in first quarter

The big news, of course, is that the company reported a profit. Lee earned $27.9 million, compared to the $48.6 million loss last year. Advertising is still down, falling 16 percent to $154 million.

Read Lee's news release.

And Editor & Publisher's story.

4th quarter earnings out; expect more cuts

Lee reported a profit in its fourth quarter of about 4 cents per share, or $1.8 million. Operating cash flow grew 10.5 percent and operating expenses were cut 25.5 percent. Furloughs and layoffs cut compensation by 23.5 percent, and the number of full-time employees by 15.1 percent.

Lee will cut costs even more: 15 percent to 16 percent in the current quarter, and 6 percent to 7 percent overall in fiscal year 2010, according to the earnings report.

"While we can't predict the timing of the economic recovery, we believe our streamlining of costs, aggressive sales programs and unmatched delivery of local news, information and advertising have positioned Lee to emerge strong," CEO Mary Junck said in a statement. “In 2009, we increased local market share by taking millions of advertising dollars from competitors, and in 2010 we expect to gain further share through our rollout of online behavioral targeting advertising and other intensive sales programs.”

Junck said September and October were the best months for advertising revenue in fiscal year 2009, but there has been a 19.7 percent drop in retail ad revenue, a 24.7 percent drop in online ad revenue and a 31.8 percent drop in classified advertising. Circulation revenue fell 6.3 percent.

Lee did reduce its debt ... to $1.1 billion.

See the full fourth quarter report.

Lee stock soaring

Lee stock is soaring the past few days -- it closed at $3.47 on Tuesday and at times on Monday and Tuesday was above $4. Back in August, CEO Mary Junck bought 20,000 shares for about $2.22. That means she's made $25,000 since then.

A year ago, Lee's stock was in this same range, then fell in November. Lee will release its fourth-quarter earnings on Nov. 12; we'll see how that affects stock prices.

Lee loses $24.5M in third quarter

Lee Enterprises reported a $24.5 million quarterly loss today.

Revenue fell 20.5 percent to $203.8 million. CEO Mary Junck said the company is cutting operating expenses by 22 percent and paying off $18 million in debt. So far, stock prices are down more than 15 percent today.

• Here's Lee's official release.
• The Editor & Publisher write-up
• Associated Press write-up

Post your thoughts on what this means in the comments.

Stockholder expecting good news in earnings report

Ariel Investments LLC, Lee's largest stockholder, believes newspapers will beat analyst estimates for the next year and a half as the advertising decline levels off and moves to cut expenses pay off.

“With all the cost cutting, you just have to have some reasonable growth in revenue and you’ll have spectacular earnings growth,” said John Rogers Jr., chief executive officer of Chicago-based Ariel Investments LLC, which is also McClatchy Co.’s second-biggest holder. “This economy is going to recover and people are going to advertise again.”

Of course, some of that cost cutting has been layoffs.

As of June 30, Ariel had 4.44 million shares of Lee stock, or 11 percent. Ariel is also Gannett's largest stockholder (28.5 million shares, or 12 percent).

Lee will release its third quarter earnings on Thursday.

Lee earnings out Thursday

Lee's earnings report is due Thursday. Gannett and McClatchy have reported higher than expected earnings lately, which has helped Lee's stock. Gannett and McClatchy were expected to post losses; so is Lee.

1Q earnings released

First-quarter earnings were released today, and stock fell 13.89 percent to close at 31 cents a share.

CEO Mary Junck says the company is cutting costs, including 10 percent of its workforce. So far, I've counted up 122 layoffs since Jan. 1. Adda comment or send an e-mail if you know of other layoffs and/or outsourcing: lee.ent.watch@gmail.com.

First-quarter earnings due Jan. 20

Lee will release its first-quarter earnings on Jan. 20. In that quarter, more than 100 employees have been laid off.

More cuts predicted

"Newsosaur" Alan Mutter took a look at Lee's earnings and predicts "draconian expense cutting." We're in good company. His list also includes other profitable by not profitable enough companies: GateHouse Media, Journal Register, McClatchy and Tribune Co.

On Friday, CEO Mary Junck said next year's operating expenses will be cut by 6 to 7 percent.

4th quarter report out

The results of the (preliminary) 4th quarter report:

• Net profit fell 73 percent
  
• Net income was $5.4 million, down from $20 million a year ago
• Revenue fell 13 percent
• Advertising revenue dropped 15 percent
  

Watch out, folks. CEO Mary Junck said the company plans to reduce next year's operating expenses by 6 to 7 percent.

4th-quarter earnings preview

Fourth-quarter earnings come out today. AP speculates things you already know:

Lee is expected to report lower profit and revenue in the quarter that ended Sept. 30 than it did a year earlier amid a prolonged advertising downturn at newspapers.

Interesting that when the third quarter ended on June 30 stock was at $3.99. When the fourth quarter ended on Sept. 30, stock was at $3.50. Right now it's down to $1.40.

4th quarter earnings out Thursday

Lee stock hit a new low, hitting $1.85 during trading Friday and closing at $1.87. The company will release its fourth-quarter earnings on Thursday.

Lee plans to cut 5-7% this year

Lee recently reported its third quarter earnings. Or lack of. The biggest surprise was the 9.1 percent drop in online revenue. Content Bridges predicts those losses will mean more cuts at Lee:

What's going on with Lee's online growth number? Coming in at a negative 9.1%, it's a head-scratcher. We know that newspaper companies each bring their own unique accounting to print/online revenue allocations, and that could be an issue here. Or could be the upsell addiction, though Lee has put a lot of energy into transforming its sales as well. The next quarter's number will be fascinating to hear.

So you think current cuts are tough? Lee told us they cut 2.3% in expenses, this quarter 2008 compared this quarter 2007. But CEO Mary Junck added she plans additional expense cuts of 5-7% in the coming year. That could be lots of newsprint and jobs. McClatchy CEO Gary Pruitt pegged further non-newsprint expense cutting at more than 10%. Other CEOs tell a similar story.