Times Mirror sees red for its 4th quarter due to one-time charges.After two years of declining earnings, Los Angeles-based Times Mirror Co. is projecting a loss in the fourth quarter of 1991. Stock in the media giant was trading for about $27 per share last week, very close to its 52-week low of $25, and down about 15 percent from its $32 high last winter. The company stressed, however, that the projected loss is due to extraordinary one-time adjustments and that operational results have improved, compared to the fourth quarter of 1990. In fact, stock analyst Paul Wayne with Crowell, Weedon & Co. in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. , said his firm believes Times Mirror's share price has basically hit bottom and Crowell Weedon is recommending purchase of the stock. "Nobody's going to look at operating net. Everybody's going to look at operating performance," said Wayne. Times Mirror said the loss would result chiefly from payments made to employees who accepted early retirement/severance packages at the Los Angeles Times Los Angeles Times Morning daily newspaper. Established in 1881, it was purchased and incorporated in 1884 by Harrison Gray Otis (1837–1917) under The Times-Mirror Co. (the hyphen was later dropped from the name). and the Baltimore Sun Baltimore Sun Daily newspaper published in Baltimore, Md., U.S. It was begun as a four-page penny tabloid in 1837 by Arunah Shepherdson Abell, a journeyman printer from Rhode Island. , plus the writedown writedown A reduction in the value of an asset carried on a firm's financial statements. For example, the firm's accountants, believing the inventory is overvalued, may decide to take a writedown by reducing inventory valuation. of long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. notes the company received when it sold the Denver Post to MediaNews Group Not to be confused with Media General, an unrelated newspaper and TV group. MediaNews Group, based in Denver, Colorado, is one of the largest newspaper companies in the United States. in 1987. Part of the price of the Denver Post was paid in MediaNews Group notes, and Times Mirror said it has determined through meetings with MediaNews Group that the notes are now worth about $65 million less than previously estimated. This writedown alone will lower earnings by about 33 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. , the company announced. "The actual amount of the writedown will reflect currently pending negotiations between the company and the affiliate of MediaNews Group to restructure the notes in a manner consistent with the Post's continuing and future competitive success in the Denver marketplace," Times Mirror reported in a prepared statement, which seems to indicate that MediaNews Group is having trouble paying its debt to Times Mirror because of revenue problems at the Post. "That's a one-time thing. I'm pretty sure there's nothing else like that out there," said Wayne. In the third quarter of 1991, Times Mirror revenue and net income equaled that of the same quarter last year, putting a stop to continued declines. Net income in the third quarter was 32 cents per share, less than the fourth quarter writedown expected from the note value adjustment. For the first nine months of the year, Times Mirror has recorded net income of $95 million, or 74 cents per share, down 30 percent from a year earlier. Full-year earnings last year were off 39 percent from 1989. "This has been a tough couple of years for the newspaper business, and Times Mirror was harder hit them most," said Wayne. "We've had 19 months of negative classified lineage LINEAGE. Properly speaking lineage is the relationship of persons in a direct line; as the grandfather, the father, the son, the grandson, &c. . I believe things will turn around." |
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