Bottom Line At News
Makes It Tops in Profitability

by Tom Buckham
Chief Steward Editorial Dayside

Despite continued flat revenues, The Buffalo News remained one of the nation's most profitable newspapers in 1998.

The very healthy bottom line -- a net profit of $31.2 million, down from 1997's record $32.6 million - received scant attention March 29 and 30, as employees gathered to hear management's annual spin on the state of The News.

The paper's operating profits, which totaled $53 million, down from the year-earlier record of $56 million, were not mentioned.

Instead, the focus was on slow revenue growth.  Treasurer Rod Layton, who led off the presentation, noted income edged up about 6 percent to a record $157.2 million from $155.5 million the year before. Expenses, which rose 5 percent to $105 million, were lifted by a one-time charge of $2 million for workers compensation claims and $662,000 in buyouts, which was offset by a $700,000 decrease in the company's contribution to the pension plan.

Layton and Scott Brooks, vice president and Advertising director, bemoaned the long-term decline in ROP advertising, which dropped 25 percent over the last decade.  After counting the major-advertiser gains and losses, Brooks noted that the closing of the Harry Rosen clothing store and other threatened losses could cost The News $2.7 million in annual ad revenues.

Paul Glaeser, vice president and Circulation director, said circulation stabilized in 1998, halting a long, steep, decline, but more people are buying the paper fewer times each week. Nevertheless, the market penetration rate remained the highest among major-market newspapers, Glaeser noted. Despite a continuing population decline, 70 percent of area residents continue to buy and read The News - a figure that translates into high advertiser interest and high ad rates.

Murray B. Light, editor and senior vice president, previewed both the rewiring of the newsroom to accommodate state-of-the-art Coyote personal computers, and the planned installation of the Berlin photo archive, which will place pictures at the editors' fingertips.

Bob Casell, senior vice president of operations, talked about the addition of two palletizers, a planned overhaul of the dock area and the addition of four tractor-trailers to the truck fleet, all of which will speed delivery of The News to readers.