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New York Times Company’s Profit Drops 26 Percent

2010′s fourth quarter was another rough one for the New York Times Company, as its profits fell by 26 percent to $67.1 million, down from the 2009 mark of $90.9 million.

As has been the case for the best paper we have, declining print ad sales were to blame. Janet Robinson, President and CEO of the New York Times Company, explained in a release:

The advertising marketplace was volatile during the quarter. The progress we made on the print advertising front in October and November was not sustained in December due to a combination of difficult year-over-year comparisons and advertiser caution about the economy and consumer spending. And although digital advertising remained strong and grew 11 percent, it could not fully offset the 7 percent decline in print advertising revenues in the fourth quarter.

Read the rest of the company’s release after the jump.

Total revenues decreased 2.9 percent in the fourth quarter of 2010 compared with the fourth quarter of 2009 as advertising and circulation revenues declined 3.1 percent and 3.6 percent, respectively. Increased digital advertising revenues, which rose 11.1 percent, partially offset a 7.2 percent decrease in print advertising revenues.

Operating costs excluding depreciation, amortization and severance decreased 1.8 percent in the fourth quarter of 2010 versus the fourth quarter of 2009. On a GAAP basis, the Company’s operating costs decreased 5.3 percent in the fourth quarter of 2010 versus the fourth quarter of 2009.

Operating profit excluding depreciation, amortization, severance and the special items discussed below declined 7.1 percent to $146.4 million in the fourth quarter of 2010 compared with $157.6 million in the fourth quarter of 2009. On a GAAP basis, the Company had an operating profit of $111.6 million in the fourth quarter of 2010 compared with $136.0 million in the fourth quarter of 2009.

For 2010, operating profit excluding depreciation, amortization, severance and the special items discussed below increased 20.0 percent to $384.3 million compared with $320.2 million in 2009, and on a GAAP basis, operating profit increased to $234.1 million from $74.1 million in 2009.

Diluted earnings per share from continuing operations excluding severance and the special items discussed below were $.46 per share in the fourth quarter of 2010 compared with $.44 in the same period of 2009. On a GAAP basis, the Company had diluted earnings per share from continuing operations of $.44 per share in the fourth quarter of 2010 compared with $.48 in the fourth quarter of 2009.

The Company has continued to manage its liquidity position and ended the year with net debt, as defined below, of approximately $597 million and total debt and capital lease obligations of approximately $996 million.

“In 2010 we demonstrated further progress toward our long-term strategy of re-engineering our Company, and grew operating profit excluding depreciation, amortization, severance and special items by 20 percent for the year,” said Janet L. Robinson, president and chief executive officer, The New York Times Company. “During the fourth quarter we maintained our relentless focus on managing costs to mitigate the effects that the ongoing transformation of our industry and an uneven economic recovery had on our operating performance.

“The advertising marketplace was volatile during the quarter. The progress we made on the print advertising front in October and November was not sustained in December due to a combination of difficult year-over-year comparisons and advertiser caution about the economy and consumer spending. And although digital advertising remained strong and grew 11 percent, it could not fully offset the 7 percent decline in print advertising revenues in the fourth quarter.

“We have remained focused on diversifying our revenues and strengthening our digital businesses. Advertising revenues from our digital products have become a much more significant part of our mix and made up 26 percent of the Company’s total advertising revenues in the fourth quarter.

“We have continued to strengthen our balance sheet and improve our liquidity position. In November, we completed a $225.0 million offering of 6.625 percent senior notes and with the proceeds from this transaction, along with strong cash flow from operations, we ended 2010 with $400 million in cash and short-term investments, even after making pension contributions of about $176 million during the year.”

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