Meredith Cuts 2009 Outlook on Weaker Publishing Profits and Revenue
Meredith Corp. trimmed its full-year outlook on Wednesday, citing weaker ad sales and rising paper prices as the major reasons for lowering its expectations.
First-quarter publishing operating profit was $33 million and revenues were $300 million, down from an operating profit of $55 million and revenues of $330 million in the same period last year. Advertising revenues were $148 million, versus $181 million in the first quarter of fiscal 2008.
"The weak economy continues to significantly impact the demand for advertising. However, other fundamentals of our business remain strong," said Stephen M. Lacy, Meredith's president and chief executive officer. "Our circulation metrics and news ratings are solid. Our non-advertising related businesses, particularly Meredith Integrated Marketing and brand licensing, are posting strong revenue and profit growth. Additionally, political advertising revenues are meeting expectations."
The company also cited rising paper prices of around 20 percent as a major reason for the change in outlooks.