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Time Warner Profits Fall... MSLO Declines...

Time Warner executives hope to cut $100 million in expenses from its publishing division.

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MSLO DECLINES: The publishing division of Martha Stewart Living Omnimedia posted a 21 percent drop in revenues for the third quarter, to $27.1 million, due to a decline in advertising pages, subscription revenue and lower newsstand sales. The division also reported an operating loss of $2.5 million, compared with a gain of $2.1 million during the same period last year. Revenues in MSLO’s Internet business declined 6 percent to $2.8 million, while the operating loss was $2.1 million versus a loss of $1.5 million last year. The company’s digital properties had record traffic in October, with 131.4 million page views and 5.6 million unique visitors. Total revenues for the company fell 25 percent to $49.7 million and MSLO increased its net loss to $12.1 million, from $3.7 million a year ago.

Kelli Turner, chief financial officer, said visibility for 2010 is limited, but in the fourth quarter the company expects a substantial improvement in performance across all businesses. Print ad revenue during the period is expected to be flat compared with the prior year, an improvement over the previous three quarters, which were down more than 20 percent. And Internet advertising is expected to post double-digit growth. The December issue of Martha Stewart Living will be the largest issue this year, up 21 percent to 161 ad pages. It will have a triple cover, sponsored by Garnier Nutritioniste.

Meanwhile, News Corp. reported first-quarter 2010 earnings on Wednesday, posting a 9 percent increase in operating income, to $1.04 billion, thanks to increases in filmed entertainment, cable network programming and book publishing. Net income rose 11 percent to $571 million and revenue fell roughly 5 percent to $7.2 billion. In the newspapers and information services segment, which includes the Wall Street Journal, operating income fell $109 million, to $25 million, as a result of lower ad revenue. Chairman and chief executive officer Rupert Murdoch said during a conference call with investors that the Journal is “barely” profitable. Previously, Murdoch had said all News Corp. Web sites would charge for content by 2010 but it appears that timeframe could be pushed out further now. “It’s a work in progress,” he added.

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