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7 Major newspapers report lower revenues for 2008

Seven leading newspaper companies have all announced lower revenues as part of their financial statements for the business year 2008, which ended on March 31, 2009. The unconsolidated figures released by the companies showed all seven experiencing a year-on-year drop in sales and operating profits (see Table).

The seven reporting newspapers were the Asahi Shimbun, the Mainichi Shimbun, the Yomiuri Shimbun, the Sankei Shimbun, the Hokkaido Shimbun, the Chunichi Shimbun and the Nishinippon Shimbun.

The Mainichi and the Yomiuri registered their first net losses in 15 years, and the Chunichi did so for its first time ever.

Here is a summary of the seven companies’ statements:

(Asahi)
The Asahi Shimbun reported 8.7 percent lower sales than the year before, registering a year-on-year decline for a fourth straight year linked to a decrease in advertising revenue and a decision to spin off its publishing section. The company said it had managed to cut its operating expenses by 5.3 percent by limiting its personnel costs and sales promotion expenses. However, it said that its decline in sales significantly exceeded the size of its cutbacks, resulting in an operating loss of \1,071 million. It is the first time that the Asahi has ever registered an operating loss. The company did log a net profit of \2,770 million on earnings from sales of its shares in TV Asahi.

The Asahi Shimbun’s consolidated statement, covering all 48 subsidiaries, showed a higher net loss at \13,914 million, which was also the first consolidated loss reported since the company began issuing consolidated results in 2000.

(Mainichi)
The Mainichi Shimbun reported an operating loss of \2,584 million, which was lower by \5,278 million than the loss for the year before. The figures show that cutbacks in operating expenses were effective but still insufficient to compensate for an even greater decline in sales. The Mainichi’s pretax loss was \2,695 million. The results represented the Mainichi’s first pretax and net losses in the 15 years since 1994.

On a consolidated basis covering 32 companies, including 26 subsidiaries, Mainichi sales declined 4.5 percent year-on-year, for a net loss of \1,211 million. A continuing gain in its real estate section was insufficient to offset its drops in circulation and other revenues.

(Yomiuri)
Based on consolidated results for the holding company and group companies, the Yomiuri Shimbun’s core business centering on newspaper publishing managed to remain profitable. However, it logged a net loss of \8,090 million due mainly to a write-down of a sizable loss related to securities revaluations in its report on extraordinary loss/gain. The results incorporating that loss represent the company’s first reporting of a net loss in 15 years.

The Yomiuri’s revenues from circulation and business projects showed only a marginal year-on-year decline, but advertising revenue plummeted steeply. Despite higher revenues from other segments, the company’s aggregate sales figure plunged 4.4 percent year-on-year, leading to a 63.7 percent collapse in pretax profit.

(Sankei)
The Sankei Shimbun reported a pretax loss of \645 million, based on a year-on-year drop in both sales and profit. The daily newspaper’s circulation has declined since late last year under the impact of the economic slump. In addition, spot sales of its tabloid-sized Yukan Fuji evening newspaper and the Sankei Sports daily remained weak, contributing heavily to a drop in circulation revenues. The company also failed to end a continuing decline in advertising revenue. The result was a year-on-year drop in both sales and profit.

On a consolidated basis covering 36 companies including 29 subsidiaries, the Sankei’s group sales plummeted 20 percent year-on-year. Aside from the drops in circulation and advertising revenues, a subsidiary that publishes Sankei Living, a community-based free paper, was excluded from Sankei’s consolidated accounting, underlining a poor financial result. On the other hand, Sankei’s digital media business remained solid. Combined with tighter cuts in operating and other costs, that company managed to post an operating profit of \763 million, while all the other factors led to a net loss of \2,612 million.

(Hokkaido)
Due chiefly to a more than 10 percent drop in advertising revenue, the Hokkaido Shimbun’s sales plunged 5.6 percent year-on-year to \59,793 million. Pretax profit sank by 57.7 percent to \991 million for a year-on-year drop in both sales and profit for a third consecutive year. Net profit plummeted 52.3 percent to \435 million.

(Chunichi)
The Chunichi Shimbun suffered a year-on-year drop in sales for its third consecutive year. Circulation revenue dipped only marginally, but advertising revenue decreased substantially. The drop in advertising revenue (for a fourth consecutive year), coupled with an appraisal loss of assets for its qualified pension system, resulted in the company’s first-ever net loss.

(Nishinippon)
The Nishinippon Shimbun suffered a year-on-year loss in revenues in each of its circulation, advertising, business-project and digital media sections. In particular, advertising revenue plunged a significant 15.4 percent. As a consequence, pretax profit declined 24.5 percent, marking a third straight year-on-year drop in both sales and profit. The company registered an operating loss of \83 million, for its first loss in 23 years. However, positive results from its non-operating income section managed to pull the company up enough to report both a pretax and net profit.

Notes:
*　Unit: 1million yen
**　Figures in parentheses show percentage change from same period of year before
***　▲: decrease
****　Yomiuri figures show consolidated results of its six group companies