GateHouse Media sees fourth-quarter gains, net loss for the year

GateHouse Media, Inc. saw revenue and income gains in the fourth quarter of 2011, but it wasn’t enough to offset a loss for the year for the Fairport–based digital and print media company that owns The Observer-Dispatch in Utica and several other area publications.

GateHouse reported fourth-quarter net income of $6.2 million, or 11 cents per share, on revenue of $144.4 million. That’s up from net income of $1.1 million, or 2 cents, on revenue of $143.4 million in 2010.

However, the company still reported a net loss of $22.2 million, or a loss of 37 cents per share, on revenue of $525.8 million for 2011. That’s a slight improvement over 2010’s net loss of $26.6 million, or a loss of 45 cents per share, on revenue of $558.6
million.

GateHouse’s results were slightly influenced by a 53rd week in fiscal year 2011, which fell in the fourth quarter. In addition, about 40 percent of the business changed its reporting period from a calendar year to a 52-week reporting period to be consistent with the rest of the company. That move resulted in one additional net day in 2011, including six days in the fourth quarter.

GateHouse did not provide breakdowns of its revenue beyond the $101 million that came from advertising, the $36.4 million from circulation, and the $7 million from commercial printing, but did note that its revenue for digital products rose 17.2 percent during the quarter and 23.5 percent for the year.

“We are starting to see some positive changes in our trends resulting from the strategic initiatives we embarked on in 2011,” GateHouse CEO Michael Reed said in a news release announcing the results. “I am pleased with the implementation of a more structured approach to many of the functional areas of our business and the impact it is having on our results. We also adopted a new companywide organizational structure in January 2012, and we are excited about how this should positively impact results in 2012 and beyond.”

The company benefited from improving trends across many of its revenue categories, Reed said, and also made strides in reducing costs and realigning resources toward growth opportunities. The company also saw its digital audiences grow, he said. GateHouse cut its operating costs and selling, general and administrative expenses 1.7 percent to $111.8 million during the fourth quarter and by 5.5 percent to $439.3 million for the year.

“In 2012, we will continue to focus on all facets of our transformational strategy, including targeting further cost reduction and resource realignment, improved digital audience and revenue growth, consumer revenue growth through volume improvements and strategic pricing actions, stabilization of print through product and process improvements, and new business development,” Reed said. “Our new organizational structure was designed to give us leaner, more vertical management across most functional areas, which we believe positions the company to successfully execute on our strategy.”

GateHouse Media (www.gatehousemedia.com) owns 79 daily publications including The Observer-Dispatch in Utica, The Evening Telegram in Herkimer, and The Evening Times in Little Falls. Locally, GateHouse also owns The Pennysaver in Utica and Mid-York Weekly in Hamilton. The company’s stock trades over-the-counter under the GHSE symbol. At press time, the stock traded for about 6 cents per share.