NEW YORK TIMES CO. REPORTS EARNINGS UP 26%

Revenues Began to Weaken in March After Start of War

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NEW YORK (AdAge.com) -- The New York Times Co. reported improved results in the first quarter, in spite of the effects of the war in Iraq that are expected to continue into the next period.

The parent company of The New York Times and Boston Globe posted $68.8 million in net income, up 26.4% from the year-ago period, on revenues of $783.7 million, up 6.3% from a year ago. Advertising revenues rose 5%, or 3.9%, excluding the results of the International Herald Tribune.

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While the impact of the Iraq war on advertising has begun to moderate, it is still expected to affect the second quarter, said Times CEO Russell Lewis.

"It's a little early to declare victory on the advertising front," he said.

Declines in March
Newspaper advertising was growing 6% to 7% year-over-year until early March, but revenue dropped 1.6% for the month, excluding the Herald Tribune, said Janet Robinson, senior vice president of newspaper operations. She noted that travel categories such as hotels and transportation have weakened since early March, recruitment ads remain weak and retail advertising has seen some softening.

However, Ms. Robinson said advertisers' budgets remain intact, and she forecast a bounce back after the war's effects are removed.

Management reaffirmed its forecasts for 3% to 5% growth in newspaper advertising revenue and earnings growth in the mid-single-digit to low-double-digit percentages for the year.

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