Journal Communications moves to 2nd-qtr profit as broadcast gains overcome publishing losses

Journal Communications reports $8.1M profit in 2Q

MILWAUKEE — Journal Communications Inc. will give almost all its employees a 2 percent bonus this month and reinstate its 401(k) matching next year as a reward for favorable earnings last quarter, the media company said Wednesday.

The Milwaukee-based company reported revenue of $8.1 million in the second quarter, or 14 cents per share. That was up from a loss of $4.8 million, or 11 cents per share, last year, a figure that included a $19 million impairment charge related to its broadcast license.

The company said its latest financial performance was helped by its ongoing aggressive cost-cutting efforts, as well by increased broadcast revenue from political spending and automotive advertising.

Journal Communications publishes the Milwaukee Journal Sentinel, Wisconsin’s largest paper. It also owns 33 radio stations and 13 television stations in 12 states, along with several community newspapers and shoppers in Wisconsin and Florida.

The one-time cash bonus, which will cost $1.6 million, applies to employees who had taken a previous cut in their base pay, chief financial officer Andre Fernandez said during a conference call with analysts. Senior management is excluded from the payout.

Fernandez said he didn’t know how much the 401(k) matching would cost.

Shares rose 18 cents, or 4.7 percent, to close Wednesday at $4 after soaring as much as 13 percent earlier in the day. Shares have traded in a 52-week range of $1.13 to $6.52.

Broadcast revenue should remain healthy for the next two quarters with political campaigns heating up, chief executive Steven Smith said. Publishing and printing revenue are expected to dip further but have already shown signs of leveling off, he said.

“The slow economic recovery and continued uncertainty over jobs keeps us cautiously optimistic and our cost disciplines in place,” Smith said.

Overall revenue for the quarter was nearly flat from the year-ago quarter at $104.4 million.

The company’s executives and managers were forced last year to take a 6 percent pay cut in return for 10 more days off.

A few weeks later the Milwaukee Newspaper Guild Local 51, which represents newsroom employees at the Journal Sentinel, approved a 6.6 percent pay cut for its members in exchange for 10 more paid days off last year. Members also received a short-term guarantee of no layoffs.

Guild president Greg Pearson said Wednesday the cash bonus is expected to arrive in the next paycheck.

“Our long-range goal is to see a restoration of the 6.6 percent pay cut,” Pearson said. “Still, this is good news. I think we’re all happy to see a little more money.”

Online:

Journal Communications: www.journalcommunications.com/