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CINCINNATI ( -- Valassis today warned that earnings for the second half of the year will be below earlier projections because of declining new product activity and the impact the events of Sept. 11 had on the company's free-standing newspaper insert, targeted sampling and direct-mail business.

The Livonia, Mich.-based company said it expects earnings per share of 50 cents to 54 cents in both the third and fourth quarters, compared with consensus estimates of 58 cents in the third quarter and 63 cents in the fourth.

President-CEO Allen Schultz said the company expects third-quarter free-standing insert business to be up slightly and unaffected by Sept. 11, but that cuts in marketing budgets will affect fourth-quarter sales.

Valassis said the decline in consumer confidence could ultimately improve coupon redemptions and distribution, as it has in past recessions, but that those impacts won't be felt until next year.

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