Lee Enterprises Loses $26 Million Dollars and 7 Per Cent of Employees

Shares

I must admit that I am not a highly compensated member of a corporate board nor an expert in executive compensation, but I have to assume that Lee Enterprises CEO Mary Junck is due for another half million dollar bonus after these stellar results in the second fiscal quarter:

Operating revenue for the quarter totaled $172.3 million, a decrease of 3.6% compared with a year ago. Combined print and digital advertising revenue decreased 5.3% to $117.5 million, with retail advertising down 3.5%, classified down 7.1% and national down 9.7%. Combined print and digital classified employment revenue decreased 0.3%, while automotive decreased 3.9%, real estate decreased 12.2% and other classified decreased 11.5%. Digital advertising revenue on a stand-alone basis increased 9.9% to $15.7 million. Print revenue on a stand-alone basis decreased 7.3%. Circulation revenue increased 0.1%.

Overall, as the Washington Post reports, Lee lost 54 cents per share in the quarter for a total of 26.6 million dollars:

The company said it lost $26.6 million, or 54 cents per share, for the fiscal second quarter that ended March 25. That compares with a loss of $1.5 million, or 3 cents per share, for the same period a year ago.

Lest anyone forget, Lee’s CEO Mary Junck took a bonus of $500,000 during a quarter when the company she leads lost $26 million dollars.

Optimistic press releases about evolving “in the digital age” notwithstanding, the corporate raid on Lee’s profitable small newspapers continues, as readers and advertisers are fleeing a product that lacks the resources to produce consistent quality. Lee’s failed strategy and corporate piracy are stripping these local papers of their most valued commodity: local belief that the newspaper will offer complete and comprehensive coverage.

One has to love the dispassionate tone of corporate press releases, especially when it relates to actual human beings losing their jobs. From the press release:

Compensation decreased 5.2%, with the average number of full-time equivalent employees down 7.5%.

That’s 7 per cent fewer people collecting, editing, producing, and distributing the news that is vital to many communities only served by one newspaper.

I derive no pleasure from watching the decline of newspapers—it’s certainly a tough environment when a company with no revenue is worth more than the New York Times—but the mismanagement and theft from local newspapers by the Lee chain is especially galling. People who work for their papers and the communities those papers serve deserve better.

If you appreciate our efforts to hold Montana Republicans accountable and the independent journalism here at The Montana Post, please consider supporting our work with a small pledge.

About the author

Don Pogreba

Don Pogreba is an eighteen-year teacher of English, former debate coach, and loyal, if often sad, fan of the San Diego Padres and Portland Timbers. He spends far too many hours of his life working at school and on his small business, Big Sky Debate.

His work has appeared in Politico and Rewire.

In the past few years, travel has become a priority, whether it's a road trip to some little town in Montana or a museum of culture in Ísafjörður, Iceland.

7
Leave a Reply

avatar
4 Comment threads
3 Thread replies
0 Followers
 
Most reacted comment
Hottest comment thread
5 Comment authors
G. JohnsonDon PogrebaMark TokarskiStephenFoolslayer Recent comment authors
  Subscribe  
Notify of
Foolslayer
Guest
Foolslayer

Best kept secret of the day. Both the Montana Standard and the IR are making a profit for Lee! The recipe is simple: pare the staff to the bare bones and use cheap content (press release journalism, wire service filler, and yesterday’s news from elsewhere in the state) as a wrapper for advertising. As long as people keep buying this inflated crap it will continue. Next step will be to combine both papers under a single masthead. It’s already being discussed.

Stephen
Guest
Stephen

Lee’s situation is a rough one. They bought Pulitzer back in early 2005 when newspapers were still growing revenues. At the time, it wasn’t obvious that it was a horrible idea. Even worse, they financed it with debt. In 2009 they almost went bankrupt, and much of their debt got bought buy a series of hedge funds and private equity groups also known as “vulture funds”. These funds sought to seize control of Lee via traditional bankruptcy. This was well documented in the Wall Street Journal. http://online.wsj.com/article/SB10001424052748704641604576255151698198750.html Instead, Lee did a special kind of bankruptcy that kept them out of… Read more »

Mark Tokarski
Guest
Mark Tokarski

I’ll settle for journalism of any kind, anywhere. It’s not coming from Lee. In fact, it’s very rare here in the land of the free.

Mark Tokarski
Guest
Mark Tokarski

A journalist might follow this path to its source – who sits on the compensation committee, how many other CEO’s are directors and thus sympathetic to Junck out of self-interest. Corporate America’s CEO system is a gated community.

Too bad that Lee doesn’t do journalism. Might be a story here.

G. Johnson
Guest
G. Johnson

Support Our Work!

Poll

What would be the most appropriate nickname for Matt Rosendale?

Follow Us on Twitter

Subscribe Via E-mail

0 /* ]]> */