This morning Meredith Corporation (NYSE: MDP) reported its third quarter results for its fiscal year 2017, including total company digital advertising revenue growth of 25 percent, a third quarter record. Meredith Corp., the publisher of well-known brands like EatingWell, SHAPE, Parents and Better Homes & Gardens, also reported total company revenue of $425 million and earnings per share of $0.87. For the first nine months of fiscal year 2017, Meredith reported total company revenue of $1.3 billion, a 4 percent increase year-over-year, and total advertising revenue of $704 million, a 3 percent increase year-over-year.
Other highlights include:
- National Media Group digital ad revenue increased 27 percent, representing nearly 30 percent of total advertising.
- Local Media Group digital ad revenue increased nearly 10 percent.
- National Media Group operating profit grew almost 20 percent to $41 million.
- National Media Group’s total revenue was $283 million.
- Local media Group’s operating profit was $41 million.
- Local Media Group revenue grew to $142 million.
- Meredith’s share of total magazine advertising revenues grew to 12.1 percent from 11.0 percent, according to Publishers Information Bureau.
- Circulation revenue was flat.
- Expenses decreased 2 percent.
“We are pleased that continued strong execution of our multiplatform strategy – including our growing and profitable digital activities – has Meredith on track to deliver record revenue and operating profit for full-year fiscal 2017,” said Meredith Chairman and CEO Stephen M. Lacy in a press release. “Importantly, we continue to successfully execute our Total Shareholder Return strategy, including increasing our dividend for the 24th consecutive year.”
Operational highlights include:
- Traffic on Meredith’s digital and mobile sites increased to an average of nearly 90 million unique visitors per month.
- Meredith grew its reach to more than 110 million unduplicated consumers, including over 70 percent of millennial females.
- Meredith launched The Magnolia Journal, an extension of Joanna and Chip Gaines’ Magnolia brand.
- Eight Meredith RV stations ranked number 1 or 2 in both morning and late news and five stations were number 1 from sign-on to sign-off.
- On April 22, Meredith closed on its acquisition of Peachtree RV in Atlanta.
“Meredith continues to fire on all cylinders, generating strong profits while increasing our consumer reach across multiple platforms,” said Meredith President and COO Tom Harty. “This includes rapid expansion of our digital offerings to consumers and advertisers alike; launching new products such as The Magnolia Journal; adding newscasts across our television station portfolio; and growing non-advertising sources of revenue such as retransmission fees, brand licensing and e-commerce.”
Meredith reported the following projections for the full-year fiscal 2017:
- Record earnings per share will be between $4.13 and $4.18 (GAAP).
- Total Local Media Group revenue will be up in the mid-single digits.
- Total National Media Group revenue will be down slightly.
- Total company revenue will to be up slightly.
Because the financials were just released, it is too soon to tell how investors will react. At the close of trading yesterday, Meredith stock stood at $64.50 per share, compared to $48.43 this time last year, on April 27, 2016.
The third quarter fiscal year 2017 report did not mention the layoffs of 40 staff announced earlier in the quarter or the rumors that Meredith might be interested in acquiring Time Inc. Because the staff cuts represent only 1 percent of Meredith’s total employee head count, they will have little impact on the company’s bottom line. An acquisition, however, is a different story, though it is unlikely that an acquisition would be completed by the end of fiscal year 2017.