Lee Enterprises, Inc. touts 8 percent increase in digital revenue during first quarter, but total company revenues fell more than 5 percent from a year ago

Lee Enterprises, Inc. – owner of the Dispatch/Argus and QC Times newspapers – Thursday (2/7) reported first quarter earnings of $10.7 million, or 18 cents per cent share, while touting its 8 percent increase in digital advertising revenue from a year ago.

Despite the improved performance of digital advertising, Lee's total revenue fell 5.3 per cent to $136 million for the three-month period. Digital advertising now accounts for nearly 34 percent of the media company's total ad revenues, according to the Lee news release.

Total advertising and marketing revenues totaled $76 million for the quarter ended Dec. 30, a 10 percent decrease compared to the same three-month period a year ago. Subscription revenue fell by 4.1 percent to $46.3 million.

Helping offset the lower company revenues was a 5 percent decline in operating expenses, including a 9 percent decrease in compensation costs, "primarily as a result of a reduction in staffing levels," the company stated.

Aiding the company's digital revenue was the performance of its TownNews, which sells a content management software platform in use by some 1,700 online news sites.

"On a stand-alone basis, revenue at TownNews increased 19.9 percent due to increased market share, including an increase in broadcast customers as well as gains in video revenue from 2018 technology acquisitions," President and Chief Executive Officer Kevin Mowbray stated.

The company also reported it had closed on the purchase of The Kenosha (Wisconsin) News, a 7-day-a-week newspaper with 20,000 circulation, and The Lake Geneva Regional News weekly from Kenosha-based media company United Communications Corporation. The price was not disclosed.

Lee executives have yet to respond publicly to an effort by activist investor J. Caro Cannell of Cannell Capital LLC to replace three members of the Lee board, including board chairman Mary Junck, Mowbray and board member Herbert Maloney. Cannell's companies control nearly 5 percent of the Lee stock. The company has sent proxy materials to shareholders opposing Cannell's call for replacing members of the board.

The annual meeting of company shareholders is scheduled for Feb. 20 at Lee's Davenport headquarters.

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