The Washington Post Co. (NYSE: WPO) reported a 7 percent drop in profits, as the newspaper division continues to struggle with industry-wide circulation and ad revenue declines.
Online earnings and revenue attempted to offset the weakness of the print division.
For the year, revenue generated by the company’s online publishing activities, which is essentially represented by the washingtonpost.com and Slate, increased 28 percent to $102.7 million, from $80.2 million in 2005. For 4Q, online revenue increased 22 percent to $30.0 million, compared to $24.7 million in the 4Q05.
Overall, however, 4Q net income fell to $95.5 million, or $9.97 a share, compared with $102.4 million, or $10.65 a share, for the same period a year earlier. It also reported that revenue rose 10 percent to $1.04 billion from $940 million.
Unfortunately for the Post, expenses rose even higher, increasing 17 percent to $865 million from $740 million a year ago.
The company also recorded an impairment charge at PostNewsweek Tech Media of $9.9 million and a $1 million loss on the sale of the unit during the fourth quarter. Other highlights:
—The newspaper division’s revenue in 2006 increased 1 percent to $961.9 million, from $957.1 million in 2005.
—Classified recruitment advertising revenue was down 22 percent to $12.5 million in 4Q06, from $15.9 million in 4Q05.
—Also for the quarter, daily circulation at The Washington Post newspaper fell 2.9 percent, while Sunday circulation declined 3.2 percent in 2006; average daily circulation totaled 673,900, and average Sunday circulation totaled 937,700.
—Display online advertising revenue grew 46 percent for the year in 2006 and 35 percent for 4Q.
—Online classified advertising revenue on washingtonpost.com increased 18 percent in 2006 and 8 percent for the quarter. Earnings release