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Wednesday, September 13, 2006

The New York Times Raises The White Flag (NYT)

Finally, after several quarters of concern by investors and the withholding of proxies by large institutions at the last annual meeting, The New York Times Company may be getting the message. It will sell its broadcast properties which should do about $150 million in revenue this year and $33 million in operating profit. It would not be wild to speculate that the company could get $400 to $500 million for the business, especially if the stations are auctioned off individually.

According to the company, it will focus on its papers and their digital counterparts. Perhaps that should read that the company will focus on the digital counterparts.

According to The New York Times company 10-Q, newspaper revenue and revenue from related digital products rose from $796 million in the June quarter last year to $800 million this year. Without the digital products, which are not broker out, Lord only knows what the topline would have looked like. Operating income for the group was down from $107 million to $93 million over the same period. Broadcast revenue and operating income were fairly flat. The company’s standalone internet business,, had sharp increases in revenue and operating income, but with a topline of $19 million for the June period, it was a small part of the company’s total revenue of $859 million.

The company is one the right path by letting its broadcast unit go. Now, if it would sell its New England Media unit, comprised primarily of The Boston Globe, things would be nearly perfect. Revenue at the group fell 8% last quarter. And, that included its digital properties.

Douglas A. McIntyre can be reached at He does not own securities in companies that he writes about.

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