Earnings: What big investors expect this morning

[GCI stock has plunged 38% since last earnings report; bigger view]

Please see this update: Q2 profits tumble, and shares plunge anew

Gannett today is set to report crucial second-quarter earnings that may dramatically reshape the 102-year-old publishing giant. GCI could announce a spinoff or sale of some of its businesses — including the 23-station TV division — to appease increasingly unhappy investors. With 46,000 employees, Gannett is the nation’s top newspaper publisher.

The company should disclose its report on BusinessWire about 8:30 a.m. ET, one hour before stock markets open. Wall Street analysts, the powerful advisers to big investors such as mutual funds, expect Gannett to report about $1.74 billion in sales — a 10% decline from a year ago — and profits of $1.02 a share, Yahoo Finance says. Anything less would likely send GCI shares even lower.

Chairman and CEO Craig Dubow (left) and other top executives will discuss the earnings with analysts during a 10 a.m. conference call that will probably last about an hour. The call will be webcast from the company’s site. Details, here.

Dubow has so far resisted Wall Street pressure to break up Gannett into smaller, separate businesses. Those are steps already taken by Belo, owner of the The Dallas Morning News and other papers, and E.W. Scripps, whose portfolio includes the Rocky Mountain News. Under this scenario, faster-growing properties such as GCI advertising services firm PointRoll or the TV division would be rolled into one new company, and the no-growth newspapers would remain in another.

It’s unclear how long Dubow and the rest of the board of directors can hold out. Since Gannett announced first-quarter earnings on April 21, the company’s stock has plunged 38%, closing yesterday at a rock-bottom $17.35 a share — an 18-year low.

Earlier: Analyst predicts Gannett shares headed for $15, and anticipating Dubow’s analyst remarks

We know what the analysts want. Now, how about you? Your thoughts, in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.

[Chart: Google Finance]

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6 Responses to “Earnings: What big investors expect this morning”

  1. Anonymous Says:

    I think we can mark this earnings call as being the most historic in Gannett’s history.

    This is also the day the board calls up Mr. Dubow and tells him that his days are numbered.

    I am sure Mr. Dubow is a nice person and has meant no harm to anyone, but his lack of vision and determination to turn around Gannett is what will get him thrown out of this company.

    You cannot use the economy as an excuse. Stronger leaders would have made this business defensible in bad times.

    Does Mr. Dubow have what it takes to turn this company around?

    What happens when the stock hits $15? $10?

    Who is taking responsibility? You can’t blame the economy or the markets anymore. This stock is down 80% in the past year!

  2. Anonymous Says:

    Here’s the link to the early press release on Business Wire:

    http://tinyurl.com/6qnxcf

  3. Anonymous Says:

    Here we go again, i.e. “it’s the economy, stupid, not us.” From Craig:

    “The weakening economy had a dramatic impact on our results. The impairment charges reflect, in part, these challenging economic conditions and pressure on our stock price but do not affect our ability to manage our businesses or make strategic acquisitions. The difficult economic and advertising environment also should not overshadow the progress we are making on our strategic transformation as we continue to position the company for the evolving media landscape.

    “The struggling economy has put pressure on advertising demand for our publishing segment particularly classified advertising in our real estate-centric markets in the U.S. and in the UK. Broadcasting benefited from higher political advertising and positive results from Captivate which partially offset the weakness in other categories. Growth in our online revenues also contributed positively to results in the quarter. We carefully controlled our operating expenses despite higher newsprint prices, and focused on increasing efficiencies. A significant level of severance expenses related to those efforts during the quarter will better position us for the remainder of this year and into 2009. We benefited from lower interest expense, as well.”

  4. Anonymous Says:

    “Strategic acquisitions”? As in ShopLocal? Pah-lease. There’s nothing to see here investors, please move along.

    FYI … Here’s the reference to ShopLocal and PointRoll from the press release:

    Subsequent to the close of the quarter, Gannett announced that it had acquired from Tribune Company and The McClatchy Company, in separate transactions, their minority ownership interests in ShopLocal LLC, the top marketing and database services company for most major retailers in the U.S. The acquisitions present an opportunity unique to Gannett for ShopLocal to collaborate with another Gannett company, PointRoll. ShopLocal has a rich database of retailers and creates digital circulars. PointRoll can make these digital circulars interactive and broaden the distribution. Working together, they can create an end-to-end solution for retailers and a richer shopping environment for consumers.

  5. Anonymous Says:

    Time for Mr. Dubow and Ms. Martore to go. The Board of Directors needs to take charge and change the leadership that has proved to be so inept.

  6. Anonymous Says:

    When McCorkindale retired they had trouble getting anyone to take the job. That’s one reason Dubow ended up with it. Who would take the CEO job in any publicly traded newspaper company when the business is so poor? I odubt there’s any media version of Steve Jobs out there waiting for a call.

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