Scripps reports October revenues
Mon, November 12, 2001 by Tim Stautberg
CINCINNATI – The E. W. Scripps Company’s consolidated revenues for October were $122 million on a pro forma basis vs. $145 million for the same month a year ago. Factors affecting monthly results include:-- The general decline in the domestic economy and subsequent weak newspaper and television advertising market, which were further exacerbated in the aftermath of the Sept. 11 terrorist attacks. For the company’s cable television programming unit, - Scripps Networks - the advertising downturn resulted in weak “up-front” advance sales followed by weak ad sales in the “scatter” market during October.-- Uneven year-over-year newspaper revenue comparisons caused by the loss of a Sunday during the month. October 2001 had four Sundays compared to five in October 2000. Newspapers derive a significant percentage of total revenues from Sunday editions. Adjusting for the day switch in October, newspaper advertising revenue was down 10 percent.-- The relative absence of broadcast television political advertising revenue this year compared to last. Broadcast television political advertising for the month was $700,000 compared to $13.7 million in October 2000. Broken down by operating division, October revenues compared to the same year-ago period were:-- Newspapers: $59.4 million vs. $67.1 million, down 12 percent.-- Scripps Networks: $27.3 million vs. $30.3 million, down 10 percent.-- Broadcast Television: $27.3 million vs. $39.4 million, down 31 percent.-- Licensing and other media: $8.0 million vs. $8.6 million, down 7.4 percent.Brand expansion continuesDespite the cyclical weakness in advertising revenues, the company continued to see expansion of its valuable brands. At Scripps Networks, distribution of Home & Garden Television and Food Network continued to grow. HGTV now reaches 74.8 million households, up 8.4 million from the same period a year ago and up 500,000 from the previous month. Food Network now reaches 68.4 million homes, up 15.4 million from October 2000 and up 700,000 million from the previous month.Scripps Networks during October announced a distribution agreement with Time Warner Cable that will increase HGTV and Food distribution, combined, by 2 million subscribers by the end of 2001. The agreement also will extend distribution of the Do It Yourself (DIY) network to 5 million additional homes by the end of 2003. DIY now reaches 6 million satellite and cable television households and is on track to reach 20 million households by the end of 2003. The agreement also secured distribution of 5 million households for the newest Scripps Networks brand, Fine Living, which is scheduled to debut in March 2002.Guidance updatedBased on weaker-than-expected newspaper advertising revenue in October and the current newspaper advertising outlook for the remaining two months of the year, the company anticipates that fourth quarter earnings will likely fall below the low end of its previously issued guidance of 55- to 65-cents per share. The company now estimates that fourth quarter earnings will be in the 45- to 55-cent range vs. 69 cents in 2000. At Scripps Networks, the company expects total revenue growth of nearly 10 percent in the fourth quarter, despite weak October revenue results.The discussion and the information contained in this press release contain certain forward-looking statements that are based on management’s current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from the expectations expressed in the forward-looking statements. Such risks, trends and uncertainties, which in most instances are beyond the company’s control, include changes in advertising demand and other economic conditions; consumers’ taste; newsprint prices; program costs; labor relations; technological developments; competitive pressures; interest rates; regulatory rulings; and reliance on third-party vendors for various products and services. The words “believe,” “expect,” “anticipate,” “estimate,” “intend” and similar expressions identify forward-looking statements. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. The E.W. Scripps Company is a diverse media concern with interests in newspaper publishing, broadcast television, national television networks and interactive media. Scripps operates 21 daily newspapers, 10 broadcast TV stations and three cable television networks, with plans to launch a fourth.Scripps national television network brands include Home & Garden Television, Food Network, Do It Yourself and Fine Living, due to launch in March 2002.The company also operates Scripps Howard News Service, United Media, the worldwide licensing and syndication home of PEANUTS and DILBERT, and 31 Web sites, including hgtv.com, foodtv.com, diynet.com and comics.com.