While I wait for McClatchy muckety-mucks to respond to my questions I’ll slide along these interesting numbers from the company’s “10Q” report — breaking out the first quarter performance of the Star Tribune this year compared to 2006.
It ain’t pretty.
God help you if you ever rely on me for advice on your investments, but this appears to show a $35 million DROP in revenues from year to year, a roughly 40% decline. As I say, I’ve contacted McClatchy’s money gurus for clarification, asking if somehow this precipitous a drop is related to one-time bookkeeping jiggering associated with the sale to Avista Capital Partners. (I’m not holding my breath that they’ll get back to me.)
Until then maybe one of you can offer an explanation.
IF the numbers are correct and IF they are a pure reflection of routine business activity at the Star Tribune over the past year, my curiosity is then whether this has come as a surprise to Avista, and whether it in anyway ratchets up their impatience with their new toy and their desire to accelerate profit-taking through forced attrition, real estate sell-offs, etc.
Here is the link to entire report.
The Star Tribune entry is located on Page 10, Note 2.
UPDATE: I should have held my breath a bit longer.
McClatchy Treasurer, Elaine Lintecum, responded to my question about this drop-off saying:
“We sold the Star Tribune on March 5. So the 2007 amount includes only 2 months versus 3 months in the prior year.”
R. Elaine Lintecum, Treasurer
The McClatchy Company
That was one line of thought, but the statement didn’t provide a footnote specifically explaining that difference. But okay. If true, that is definitely better for all concerned. Well, for Avista anyway, I’m not sure about its employees.
Assuming each month represents roughly 33% of income, the Strib’s year-to-year revenue slide is more in the “normal” 7% range than something truly apocalyptic like 40%.
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