11/20/2008

Associated Press

McClatchy Co., the nation's third largest newspaper chain, said Wednesday that October revenue fell by 17.8 percent as the slump in print advertising continues to weigh on its business.

The publisher of The Miami Herald and newspapers in North and South Carolina said revenue fell to $176 million from $214.2 million last year. About 82 percent of its overall revenue comes from advertising.

Classified ad revenue plunged by 35.8 percent to $40.4 million, led by employment ads, down 48.6 percent, followed by real estate at 41.5 percent and autos, down 30.5 percent.

Retail ad revenue fell by 11 percent while national ad revenue declined by 13.9 percent.

Within advertising, print ads fell by 23.3 percent in October to $128.2 million. A decline in classified ads again led the way, down 40.7 percent with particular weakness in job, real estate and auto ads. Retail advertising was down 14.2 percent and national ads fell 19.3 percent.

Pat Talamantes, McClatchy's chief financial officer, said, "Online advertising continues to be a bright spot for the company."

Online ads rose by 12.4 percent to $16.4 million. Excluding employment ads, online advertising revenue would have risen by 57.6 percent year-over-year, the company said.

For the first 10 months of the year, total revenue fell by 15.5 percent to $1.61 billion, with print advertising declining by 20.1 percent to $1.17 billion while online ads rose by 10.9 percent to $155.4 million.

The company said average daily circulation in October fell by 7.6 percent to 2.56 million and Sunday circulation went down by 5.3 percent to 3.2 million.

McClatchy owns 30 daily newspapers, about 50 non-dailies and related Web sites. In North Carolina, the company owns The Charlotte Observer and The News & Observer of Raleigh. Its holdings in South Carolina include The State of Columbia, The Sun News of Myrtle Beach, the Herald of Rock Hill, and The Beaufort Gazette and The Island Packet of Hilton Head.

Its shares closed down 42 cents, or 21.8 percent, to $1.51.