Long term ad revenue decline results in revision from “positive” to “stable”
Standard & Poor’s has issued the following statement regarding Gannett Co. Inc.:
— We expect the pace of newspaper publishing ad revenue declines will continue, and possibly accelerate over the near term, as a result of the weak economy and unfavorable fundamentals in the industry.
— We have affirmed all ratings on Gannett Co. Inc., including the ‘BB’ corporate credit rating.
— We have revised our outlook on Gannett to stable from positive, reflecting our view that any upgrade potential likely involves a longer time horizon than the next 12 months.
Although we expect Gannett to outperform most of its U.S. newspaper peers, especially those with a metropolitan focus, and maintain a good consolidated EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) margin, the company remains dependent on the newspaper industry, which we view as subject to long-term secular decline. The company’s TV broadcasting business faces mature long-term growth prospects, and operating performance remains sensitive to political advertising cycles. We believe these dynamics, together with increased risk of a return to recession, will cloud the revenue picture for at least the next 12-24 months.
In Arizona, the company’s holdings include the Arizona Republic; Tucsoncitizen.com; KPNX-TV 12, Phoenix; the Tucson Newspaper Partnership; and USATODAY print site, Phoenix. National divisions can be seen here.
The company’s stock chart can be seen here, while the Wall Street Journal’s Market Watch provides the latest real time quotes.
Read the complete Reuters News agency report here.
Less than two weeks ago Gannett Chairman and CEO Craig A. Dubow took a medical leave of absence as reported here.