The Washington Post Company
's (
WPO
) third-quarter 2012 earnings from continuing operations came in
at $6.79 per share, up approximately 31% from $5.18 earned in the
prior-year quarter reflecting strength across Television
Broadcasting and Cable Television divisions, offset by sluggish
performance in the Education and Newspaper Publishing
divisions.
Including one-time items and discontinued operations, the
company posted quarterly earnings of $12.64 compared with a loss
of 82 cents a share in the year-ago quarter.
Revenue for the quarter came in at $1,011.3 million compared
with $1,012.5 million in the prior-year quarter.
Education
division's revenue went down 8% to $552.6 million, reflecting a
17% fall in Higher Education revenue partially mitigated by a 2%
increase in Test Preparation revenue and a 3% rise in Kaplan
International revenue. The Education division saw operating
income of $14.7 million compared with $20.8 million in the
prior-year quarter.
Total student enrollment fell 8% year-over-year but jumped
sequentially by an equivalent percentage to 73,261. The company
hinted that new student enrollment rose 9% during the quarter at
Kaplan University and Kaplan Higher Education Campuses.
Television Broadcasting
revenue surged 44% to $106.4 million during the quarter, whereas
operating income rose more than twofold to $54.1 million,
attributable to healthy advertising demand. Moreover, political
advertising also contributed $15.6 million to the revenue.
Cable Television
division's revenue rose 6% to $199.6 million. The division
benefited from revenue growth registered across Internet and
telephone service revenues, but was offset by higher promotional
discounts and fall in basic video subscribers' base. The
division's operating income jumped 8% to $39.9 million
attributable to higher revenue partially offset by increased
programming expenses.
Basic video subscribers fell 3.6% to 605,057. On the other
hand, high-speed data subscribers rose 3.3% to 462,808 and
telephony subscribers grew 5.2% to 185,647.
Newspaper Publishing
revenue came in at $137.3 million, down 4% from the year-ago
quarter. Print advertising revenue at
The Washington Post
tumbled 11% to $51.4 million, reflecting a fall in general and
retail advertising. Revenue from newspaper online publishing
activities, principally washingtonpost.com and Slate, jumped 13%
to $26.9 million, whereas display online advertising revenue
climbed 18%. Online classified advertising revenue inched up
1%.
During first-nine months of 2012, Post daily and Sunday
circulation fell 9.2% and 6.5%, respectively, from the year-ago
period.
The Newspaper division's operating loss widened to $21.8
million from a loss of $10.8 million witnessed in the prior-year
quarter.
Currently we maintain our long-term Underperform
recommendation on the stock. However, The Washington Post
Company, which faces stiff competition from
The New York Times Company
(
NYT
), holds a Zacks #3 Rank that translates into a short-term Hold
rating.
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