Feb. 2 (Bloomberg) -- New York Times Co., publisher of the namesake newspaper, reported a 12 percent drop in fourth-quarter profit, capping a year marked by shrinkage of print advertising.
Net income fell to $58.9 million, or 39 cents a share, from $67.1 million, or 44 cents, a year earlier, the New York-based company said in a statement today. Excluding some items, profit was 45 cents a share, compared with the 42-cent average of analysts’ estimates compiled by Bloomberg.
The company, also owner of the Boston Globe and About.com, has looked to expand its Internet business in the face of declining print ad sales. A so-called paywall, which went up in March on the New York Times website, bolstered digital advertising and lifted the publisher’s paying online subscribers to 406,000 as of Dec. 31 from 324,000 a quarter earlier.
Sales dropped 2.8 percent to $643 million. Analysts on average had estimated $646.8 million, according to a survey by Bloomberg.
The December departure of Chief Executive Officer Janet Robinson, who was granted an exit package totaling more than $21 million, left a leadership vacuum. The company is faced with falling revenue, profit squeezed by pension costs, and pressure from members of the Ochs-Sulzberger family, which controls the board, to restore a dividend once worth more than $20 million a year to them. Times Co., headed by Chairman Arthur Ochs Sulzberger Jr., hasn’t paid any dividend since 2008.
The company is looking for a non-family member to be CEO, two people familiar with the matter told Bloomberg News for an article published on Jan. 27. The two declined to be identified because the information isn’t public.
“We’re looking for some more color on what the management situation is,” Alexia Quadrani, a JPMorgan Chase & Co. analyst, who rates Times Co. shares “neutral” and doesn’t own any, said in a telephone interview on Jan. 30.
Having an executive with digital expertise is important at a time that print advertising is seeing declines, said Ken Doctor, media analyst with Newsonomics and Outsell Inc.
Gannett Co., the publisher of 82 newspapers, including USA Today, on Jan. 30 reported a 5.3 percent drop in publishing revenue for the fourth quarter.
“You’re going to see lower newspaper advertising right across the sector,” said Edward Atorino, an analyst at Benchmark Co. in New York, in a telephone interview on Jan. 27.
Times Co. shares rose 3 percent to $7.67 yesterday. The shares had declined 0.8 percent this year before today.
--With assistance from Cecile Daurat in Wilmington. Editors: Jeffrey Tannenbaum, Cecile Daurat, James Langford
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