Journal Q1 up 3.7%
For the first quarter, Journal Communications’ revenue was $96.6 million, up 3.7% over Q1 2013. Digital revenue of $4.6 million grew 5.8%. Operating earnings of $12.0 million increased 43.7%. Included in operating earnings for 2013 were $0.8 million in broadcast acquisition-related expenses and $0.2 million in non-cash building impairment charges. Excluding these special items, operating earnings increased 28.0%. Total expenses of $84.6 million decreased 0.3%. Excluding the special items, total expenses increased 0.9%. The operating margin was 12.4% for the first quarter compared to 8.9%.
Net earnings were $12.2 million compared to $3.8 million. Net earnings from continuing operations of $6.2 million increased 67.0%. In the first quarter, basic and diluted net earnings per share of class A and B common stock were $0.24 compared to $0.08. Net earnings per share of class A and B common stock from continuing operations were $0.12 compared to $0.08. Net earnings per share of class A and B common stock from discontinued operations were $0.12 in 2014 and there were no net earnings per share from discontinued operations in 2013.
“We are pleased to report that Journal Communications revenue grew nearly 4% in the first quarter benefiting from the Winter Olympics and growth in television retransmission revenue. In addition, publishing advertising revenue was essentially flat for the quarter,” said Steven Smith, Chairman and CEO of Journal. “In the first quarter, Journal Communications’ total revenue was $97 million, driving an operating earnings increase of 44% in the quarter. Earnings per share from continuing operations were $0.12 compared to $0.08 last year. In addition, the sale of our Palm Springs stations added an additional $0.12 per share from discontinued operations in the quarter.”
Revenue from television for the quarter increased 12.6% to $46.0 million. Television Olympics revenue was $2.6 million. Retransmission revenue of $9.8 million grew 85.6%. Television political advertising revenue was $0.5 million compared to $0.4 million. Local advertising revenue, excluding political and Olympics revenue, decreased 2.9%, primarily due to a decrease in professional services and media advertising. Digital revenue, which is reported in local revenue, was $1.0 million, up 17.9%. National advertising revenue, excluding political and Olympics revenue, decreased 13.7%, primarily due to decreases in automotive and restaurant advertising.
Total revenue, excluding political, Olympics and retransmission revenue was $33.1 million, down 5.6%. Operating earnings from television were $11.2 million, an increase of 60.3%. Television operating expenses increased 2.8%, or 5.2% excluding $0.8 million in acquisition costs in 2013, primarily due to increases in network fees.
For Q1, revenue from radio decreased 4.0% to $15.2 million. Radio political advertising revenue was $0.1 million in each of 2014 and 2013. Local advertising revenue, excluding political, decreased 3.2%, primarily due to a decrease in restaurant and financial advertising. Digital revenue, which is reported in local revenue, was $0.6 million, up 7.8%. National ad revenue, excluding political, decreased 18.0%, primarily due to a decrease in automotive and financial advertising. Total revenue, excluding political revenue, was $15.1 million, down 4.2%.
Operating earnings from radio were $2.1 million compared to $2.4 million, a decrease of 11.9%. Radio operating expenses decreased 2.6%, or 0.8% excluding a $0.2 million non-cash building impairment charge recorded in 2013, primarily due to lower programming rights fees.
Q2 2014 Outlook
In Q2, excluding political advertising revenue, we expect total television revenue to be up in the low to mid-teens as compared to the second quarter of 2013. In radio, excluding political revenue, JRM expects revenue increases in the low-single digits as compared to Q2 2013. In publishing, Journal anticipates revenue to be comparable to Q2 of 2013.