Winnipeg Free Press - PRINT EDITION

Free Press group shows profit

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The company that owns the Winnipeg Free Press, Brandon Sun and other Manitoba publications has bucked the trend in the North American newspaper business and posted an increase in profits for the second quarter.

FP Canadian Newspapers Limited Partnership (FPLP) recorded net earnings of $4.3 million for the quarter ending June 30, 2013, up 13.5 per cent from last year.

Revenues for the quarter were $27.3 million; a slight decline of 2.6 per cent.

The company's EBITDA (earnings before interest, taxes, depreciation and amortization) -- the gauge most industry officials watch closest -- was up 6.5 per cent for the quarter to $5.7 million.

FP Newspapers Inc. -- which owns securities entitling it to 49 per cent of the distributable cash of FPLP -- reported earnings of $1.5 million, an increase of 15.4 per cent.

Shares in FP Newspapers Inc. closed up two cents on Friday to $5.10, nearing the 52-week high of $5.24.

The results for the company -- which also owns the Carillon of Steinbach, the Carberry News Express and Canstar Community News, the publisher of six community newspapers in the Winnipeg region -- are in stark contrast to recent results from other publicly traded newspaper companies in Canada.

For example, whereas FPLP had a 6.5 per cent increase in EBITDA for the quarter, the media segment of Torstar Corp., publisher of the Toronto Star and other papers, posted a 13.3 per cent decline and Postmedia -- publisher of a number of metropolitan papers across the country including the Ottawa Citizen, the Montreal Gazette and the Calgary Herald -- had a 9.3 per cent decline in EBITDA for the same period.

Free Press publisher Bob Cox said although the company did generate an increase in earnings, it was largely because of careful cost-cutting measures as there was still a slippage in revenue.

Advertising revenue at FPLP for the quarter was $18.1 million, down 4.6 per cent from the same period last year. In comparison, print advertising at the Toronto Star was down 13.7 per cent in the second quarter.

Circulation revenue at FPLP was down 4.3 per cent in the quarter to $6.7 million and digital revenue was up $200,000 or 31 per cent.

Operating expenses were down 4.6 per cent to $22.6 million, partially due to fewer employees and an 11.1 per cent decline in newsprint costs.

Republished from the Winnipeg Free Press print edition August 3, 2013 B5

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