Profits plummet at Washington Post as Gannett slashes dividend

NEW YORK - The bad news for the US newspaper industry continues to surmount as fourth-quarter profits at The Washington Post Company fell by 77%, USA Today owner Gannett cut its dividend by 90%, and another publisher filed for Chapter 11.

Read Gordon's Republic blog post -- Is it time for newspapers to start charging for content?

The Washington Post Company, which also owns Newsweek magazine, reported profits of $18.8m compared to $82.9m last year.

The major profits fall is the ninth consecutive quarter of declining profits as revenues grew 3% to $1.16bn from $1.13bn.

Newspaper specific revenues fell 13% to $202m and reported an operating loss of $14.4m compared to a $25m profit previously.

Shares in the company fell $2.74, to $382.25 a share.

At Gannett, the dividend cut from 40 cents to four cents was its first in company history. The cut saves the company around $325m a year. It sent shares in Gannett down 23 cents to $3.52.

While Gannett cut its dividend, Media General, which publishes 24 daily newspapers including the Tampa Tribune and the Richmond Times-Dispatch, cut its entirely.

It said it expected revenue declines in all areas of advertising categories and planned to cut costs further by delaying pay increases and its matching of staff pension contributions.

Following the news earlier this week that Philadelphia Newspapers, which owns The Philadelphia Inquirer, has filed for bankruptcy protection, the Journal Register Company, which owns 20 daily newspapers, including the New Haven Register and The Oakland Press of Pontiac, has also filed for Chapter 11 protection.

Yesterday, Hearst Corporation said it was considering closing its flagship San Francisco Chronicle, the city's main newspaper, within weeks as it cuts jobs across the loss-making title and decides its future.

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