Tribune Takes It On The Chin In 4Q, '07
March 20, 2008 at 2:12 PM (PT)
TRIBUNE COMPANY today reported a loss from continuing operations of $78 million for the fourth quarter of 2007 compared with income from continuing operations of $233 million in the fourth quarter of 2006. For the full year 2007, TRIBUNE reported income from continuing operations of $55 million compared with $661 million in 2006. The declines in both the fourth quarter and full year 2007 operating results were largely due to lower revenues, higher interest expense and a variety of pre-tax charges.
"Despite the continued difficult operating environment and weakness in print revenue, we see significant opportunity within TRIBUNE COMPANY," Chairman/CEO SAM ZELL stated. "In our first 75 days, we've made a series of key leadership changes, have launched a number of programs and projects to drive new revenue, and have initiated a fundamental shift in culture. In addition, we have begun a strategic review of certain TRIBUNE assets to determine whether capital can be more effectively redeployed into our core operations or toward reducing our outstanding leverage."
Layman translation of "strategic review of certain TRIBUNE assets to determine whether capital can be more effectively redeployed into our core operations or toward reducing our outstanding leverage" -- "We're going to sell the CHICAGO CUBS and WRIGLEY FIELD for a billion-plus."
TRIBUNE's '07 4Q operating revenues fell12%, or $180 million, to $1.27 billion. Consolidated cash operating expenses dipped 1%, or $10 million. Operating cash flow fell 44% to $214 million from $384 million, while operating profit fell 92% to $27 million from $325 million.
TRIBUNE's fourth quarter included 13 weeks in 2007 compared to 14 weeks in 2006. Without the additional week in 2006, 4Q 2007 operating revenues decreased 7%, cash operating expenses increased 5%, operating cash flow decreased 41%, and operating profit decreased 91%.
Broadcasting and entertainment operating revenues for 4Q 2007 decreased 11% to $316 million, down from $356 million in 2006. Group cash operating expenses fell 1%, or $3 million, to $233 million. Operating cash flow was $83 million, down 30% from $119 million, and operating profit decreased 33% to $70 million from $106 million in 2006. Without the additional week in '06, broadcasting and entertainment 4Q 2007 operating revenues fell 7%, cash operating expenses increased 4%, operating cash flow dropped 27%, and operating profit decreased 30%.
Station revenues in NEW YORK increased but were offset by declines in most other markets. On a group basis, advertising revenues decreased due to a significant decline in political advertising, as well as decreases in the movies and retail categories, partially offset by increases in the telecom, food and financial categories. Radio/entertainment revenues primarily reflect lower revenues for the CHICAGO CUBS due to fewer home games in the quarter.