McClatchy sees digital-only subscriber growth but earnings loss in 2018
The McClatchy Co. this week reported a net loss of $27.5 million in the fourth quarter of 2018 and a continued growth in digital subscriptions and digital-only advertising revenue.
The Sacramento-based publisher of 30 newspapers saw a 51.1 percent year-over-year increase in digital subscriptions, ending the year with 155,000 digital-only subscribers. Digital-only subscriptions have increased in 11 straight quarters.
Digital-only advertising revenues grew by 5.2 percent for Q4 2018; it also surpassed print advertising revenue in the second half of 2018.
Total advertising revenues were down 16.9 percent compared to the fourth quarter of 2017, but because the fiscal quarter was one week shorter than the previous year, the revenue decline was 12.7 percent when adjusted for comparable time periods.
Total 2018 revenues were $807.2 million, down 10.7 percent compared directly to 2017 (9.3 percent when adjusted for the one-week difference). Net loss for the year was $79.8 million, which included an after-tax write down on newspaper mastheads of $37.2 million.
“In the context of a business environment that continues to be challenging for the local media industry, we made significant progress in our digital transformation while delivering on our mission of producing strong, independent local journalism in the public interest that is essential to the communities we serve,” McClatchy CEO Craig Forman said in a statement.
The company also reported a gain on extinguishment of debt, mainly due to refinancing in July. At the end of 2018, McClatchy’s debt stemming from its purchase of the Knight Ridder chain totaled $745.1 million. In September, Forman highlighted that McClatchy has paid off more than two-thirds of $3.3 billion it borrowed for the 2006 sale and that with July’s refinancing, the company pushed the earliest maturity date nearly four years to 2026.
McClatchy shares opened at $5.24 Friday.
This story was originally published March 8, 2019 at 10:32 AM.
