The Washington Post Co. said its second-quarter earnings fell 7 percent as profitability declined in three of its five main business lines, particularly newspaper publishing.
Its education business, which includes Kaplan Inc., a test preparation and education company that is the Post Co.'s largest subsidiary, remained the fastest-growing piece of its holding company's profits. Those earnings partially offset persistent weakness in its print media business, the company said yesterday.
Average daily circulation of The Washington Post newspaper, its largest media property, fell 4 percent, to 692,200, for the first six months of the year. The average Sunday edition circulation in the first half of the year fell 3.5 percent, to 985,100.
While second-quarter revenue in the newspaper division grew 1 percent, to $236 million, higher prices for paper ate into operating profits. Operating expenses for the newspaper business grew 7 percent, leading to a 28 percent decline in operating income for the division.
John B. Morse Jr., the company's chief financial officer, said the newspaper's declines in national advertising and circulation reflect broad trends that are affecting all major print media: More consumers are migrating to online information, with advertisers following them. "You're seeing that with all the media companies that have reported," he said.
New York Times Co. and Dow Jones & Co. reported declines in second-quarter profit because of drops in national advertising revenue and lower circulation revenue.
The Post Co.'s online revenue grew 21 percent in the quarter, to $18.7 million. Online classified revenue at washingtonpost.com increased 16 percent. At Kaplan, revenue grew 25 percent, to $345.8 million, and operating income grew 16 percent, to $34.1 million.