Taking the podium from AH Belo’s Robert Decherd, McClatchy (NYSE: MNI) Company Chairman and CEO Gary Pruitt opened his presentation at the UBS Global Media and Communications (PDF) conference by noting that total ad revenues through October are down 17.4 percent and a large portion of that is not coming back. Looking ahead, Pruitt didn’t sugarcoat it, “Our current results are lousy and the economy is worsening. 2009 will start ugly, but we expect it to improve.” And with over $2 billion in debt—Pruitt insisted that it is steadily being reduced.

—Online is still a bright spot, with digital revenues through October rising 10.4 percent. The fastest growing category is retail, and the area that Yahoo (NSDQ: YHOO) helps the most. We’ve only seen a small amount of Yahoo revenue and we don’t expect it to really make a difference until 2010. Chris Hendricks, VP, interactive media, added that the Yahoo partnership has contributed $3.2 million in ad sales to date. “We’re in only seven markets with Yahoo and so the partnership is still small, but the growth we expect next year is being put in place.” Moving away from print upsells, as AH Belo’s Decherd mentioned, is a major focus as the company builds up an independent online ad sales force. Hendricks said that half of the company’s online ads are not related to the print side. The company online-only ad sales have grown 26.9 percent and now represents 12.2 percent of its ad revenues, up from 8.6 percent in 2007. Afterward, Pruitt told me that that the goal is to achive a balance between print upsells and online ads. “It’s not an either/or. Our basic policy is to the let the advertiser make that call.” More after the jump.