New York Times Company Results are Rough Again, but Analyst Applauds Effort

nyt072408 0 New York Times Company Results are Rough Again, but Analyst Applauds EffortMinutes after The New York Times Company sent out an email releasing its year-end and fourth quarter financial results, which was followed by a conference call this morning, media writers jumped all over the bloody numbers.

Gawker called it "bad, bad, bad"; Portfolio pointed out that CFO Jim Follo said on the call this morning that monthly results won’t be posted anymore (too much bad news!); Peter Kafka wrote about how even digital advertising numbers were down.

And indeed, the raw numbers are ugly. Fourth-quarter income for the company was down 47.5 percent from where it was in ugly 2007. Ad revenue fell for the quarter by 17.7 percent, and 13.1 percent for the year. The company also announced this morning that it’s looking to sell its share of the Red Sox, Fenway Park and the NESN network.

So while there’s enough bad news to depress even the biggest Times-cynic, it’s not a unanimous theory that doom is near, and the company is screwed.

A few weeks ago, The Observer interviewed the analysts who track the company’s results and they—to the surprise of many—lauded Arthur Sulzberger and CEO Janet Robinson for the moves they’ve made in an impossibly bad media climate.

And today, one of those analysts, continued to praise their efforts.

"They’re doing a hell of a job," said Ed Atorino of the Benchmark Company. "They are doing a Herculean job in pulling all the stops out."

Mr. Atorino pointed out specifically to how the company is doing everything it can to stop the bleeding, all the while keeping its newspaper intact.

Printing costs were lowered—by more than $200 million, said Mr. Atorino—and things are going on the block. The company, often a labor-friendly place, has cut printing cuts and consolidated many of its printing efforts. Circulation revenue, despite an industry-wide trend of going south, actually went up in the fourth quarter.

"They’ve done a hell of a job for what has been an extremely difficult climate," he continued.

But does any of this matter? It’s great that they’re cutting extraordinarily well, but does that mean anything?

"You can’t cost-cut yourself to success or profitability, but they’ve stayed profitable," he continued.

"They’re cash-flow positive. This year will be down again, but they’re still financially viable. They’re riding the wave and hopefully will get to the shore. But clearly if they run into another couple years like this, they’ll run out of profits, and I don’t know what you do then."