- Operating revenue declined 3.9% over last year’s first quarter report. This included a 6.1% drop in advertising (digital and print advertising combined). Real estate advertising led the decline, dropping 17.9%.
- Employee compensation dropped 5.7%. The number of full-time equivalent employees dropped 7.2%.
- Debt financing and reorganization costs increased 66% to $3,265,000
Friday, January 20, 2012
Bad News On the Doorstep: Lee’s First Quarter Report
(by contributor Mark Wilson, as part of his series on the troubles at Lee Enterprises and The Post-Star)
In its quarterly SEC filing for the period ending December 25, 2011, released this week, Lee Enterprises announced its intention to seek stockholder approval for a reverse stock split. The annual meeting will be in Davenport, Iowa in March this year. The report did not state the ratio of the reverse split. Lee CFO Carl Schmidt also foreshadowed trouble for Lee’s NYSE listing with the minimum market capitalization standard, the cure period for which expires next month.
Other bad news in the SEC report:
While visits to Lee’s digital products increased 10.4%, this good news does nothing for the bottom line. In his From the Editor column last week, Post-Star Editor Ken Tingley lamented: “The problem is more and more readers are visiting newspaper websites for free while abandoning their subscriptions to the newspaper. Unfortunately, we don't make money on our websites.”
He also stated, “We have no plans to charge for use of our website right now. . .”
Bear in mind that this reassurance comes from an organization not known for its candor in reporting on itself. Last May in a letter to Lee's investors, CEO Mary Junck wrote, “We are not, as some in the national media have imagined, staving off bankruptcy.”