Media General Posts Q1 Loss on Interest, Tax Charges

As first-quarter earnings season continued, Media General (MEG), the Richmond, Va.-based broadcaster and newspaper publisher this morning reported a loss of $16.7 million, or 75 cents a share, vs. a loss of $21.3 million, or 96 cents per share, a year ago.

The unprofitable quarter resulted from substantial interest and tax payments, the company said. The company recorded $19.8 million in interest expense stemming from a new financing structure. Media General lowered its debt from $712 million in the fourth quarter of 2009 to $693 million in the most recent quarter. The company also took an income-tax expense of $6 million.

Revenue stayed flat with the year-ago quarter, and costs declined 12%. Media General managed a first-quarter operating profit of $19.4 million, compared with a loss of $780,000 a year ago.

Cost reductions again played a critical role in the company’s results. Media General shed 600 employees from the first quarter of 2009 to the first quarter of 2010.

The company also offered guidance as for the upcoming quarter:

Media General expects the decline in publishing revenues to continue to moderate. Broadcast revenues are expected to increase by about the same rate as the first quarter, based on stronger Political spending as state primaries begin. Total operating expenses in the second quarter are expected to increase 3-4 percent, reflecting the absence of furlough days in 2010 and increased support of new revenue initiatives.

Earnings season is in full swing for newspaper publishers. Check out results for: Journal Communications, Lee Enterprises and Gannett.