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RSSCommercial Appeal, The
CINCINNATI - The E.W. Scripps Co., a newspaper publisher and owner of the Food Network, Home & Garden Television and other cable networks, swung to a loss in the fourth quarter on costs for writing down its Shop At Home unit and consolidating newspaper operations in Denver.
Scripps, which also owns The Commercial Appeal, lost $603,000 during the quarter, but broke even on a per-share basis. That compares to earnings in the year-ago quarter of $91.3 million, or 55 cents per share. Revenue grew 17 percent to $706.8 million from $606.7 million.
Scripps blamed the loss on a big write-down for Shop At Home, which sells products to TV viewers and visitors to its Web site. Without that charge, Scripps said it would have earned 54 cents per share.
The company said its loss also includes the effect of a decision earlier in the year to consolidate newspaper production operations in Denver, costing 4 cents per share.
Analysts expected Scripps to post a quarterly profit of 49 cents per share, excluding one-time items such as charges, according to Thomson Financial.
Scripps' shares rose $2, or 4.2 percent, to close at $50.25 in trading on the New York Stock Exchange.
Scripps said it had to write down the book value of Shop At Home because of the unit's ongoing losses and "a longer than previously expected path to profitability." Scripps said it is in the process of exploring strategic alternatives for the struggling business. The unit lost $10.4 million in the quarter.
The newspaper division's profit was $55.4 million in quarter compared with $69.1 million a year ago, with the decline attributed to higher depreciation expenses for equipment at the Denver operations.
The company's cable networks division, however, which includes HGTV, Food Network, DIY Network and others, turned in another strong quarter, reporting a gain of 34 percent in profits from the previous quarter to $121.8 million this quarter.
Scripps also said its Shopzilla unit, an online comparison shopping service that Scripps acquired in June 2005, performed well.
For the full year, earnings fell 18 percent to $249.2 million, or $1.51 per share, down from $303.8 million, or $1.84 per share, in 2004. Annual revenue increased 16 percent to $2.51 billion from $2.17 billion.
Looking ahead, Scripps forecast first-quarter earnings of 38 cents to 42 cents per share, compared to the consensus analyst estimate of 44 cents per share.
