Sun-Times Media Group, Inc. today reported an operating loss of US$80.6 (EUR 58.5) million for the second quarter ended June 30, 2007, versus an operating loss of US$13.7 (EUR 9.9) million for the second quarter of 2006. The 2007 second quarter figures take into account the settlement reached with the Canada Revenue Agency regarding tax issues largely related to the disposition of certain Canadian operations in 2000.
Total operating revenues in the second quarter of 2007 were US$94.3 (EUR 68.5) million, versus US$107.4 (EUR 78) million in the year-ago period. Advertising revenues declined 12% to US$73.2 (EUR 53.2) million from US$83.6 (EUR 60.7) million in 2006. Classified advertising fell 18%, while retail and national advertising were lower by 9% and 19%, respectively. These declines were partially offset by a 58% increase in Internet advertising revenue.
Sales and marketing costs rose 12%, primarily related to additional marketing and re-branding efforts as well as enhancements designed to strengthen the link between print content and Internet content on www.suntimes.com.
“We have been clear all along that 2007 would be a tough year. Like all newspapers we continue to face a very uncertain advertising environment. Yet the turnaround plan we announced in May is beginning to show some results,” said Cyrus F. Freidheim, Jr., Chief Executive Officer. “We have a number of initiatives in the pipeline to transform the company. We remain confident that these plans will find their way to the bottom line despite the weak industry.
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