Wednesday, April 23, 2008

Journal Communications news worse than it seems

The JS today reported that mother ship Journal Communications net income dropped 91% in the first quarter compared to first quarter returns a year ago.

It's even worse than the paper makes it out to be.

While the JS was quick to note that last year's first quarter income was boosted by the sale of Norlight Communications, it failed to report -- whoopsie! -- that this year's first quarter income had the very substantial benefit of a boost from the Feb. 1 primary election.

You remember: Obama, Clinton, endless ads, huge advertising buys in Wisconsin's major media market, all that.

Company president Steve Smith says corporate earnings should benefit from political advertising in the second quarter, but forgot to the impact on earnings of primary election advertising. Hey, if this is how Journal Communications does when the hottest campaign in memory is going on, what will happen next year, when there are no major campaigns?

Retirees and active employees who were counting on returns from heavy investments in Journal Communications stock must be absolutely furious. Smith's glib half-explanations aren't helping.

1 comment:

capper said...

Me pappy, who only gets the Sunday paper, has been getting a lot of free weekday papers. He says that MSJ uses those extra papers to count towards their distribution numbers, artificially pumping them up. Since he used to work there in that capacity, I find little reason to doubt him.