Torstar Q2 net income falls to $18 million as revenue drops 7.5 per cent

TORONTO – Torstar Corp. (TSX:TS.B) had lower revenue and a smaller profit in the second quarter compared with last year, with its Harlequin book publishing operations especially affected by lower volumes overseas.

The Toronto-based newspaper, book and digital publisher had $18 million of net income attributable to shareholders, or 23 cents per share..

That was down from $32.6 million or 41 cents per share a year before.

Torstar’s total revenue was $354.9 million, down 7.5 per cent from $383.9 million.

Operating revenue at the Torstar media division fell to $255.4 million from $276.9 million while its book publishing division dropped to $99.5 million from $107 million.

Torstar’s president and CEO, David Holland, said a lower profit at the Harlequin book division had been expected but the decline was bigger than anticipated.

He said the media operations that include the Toronto Star and other newspapers continue to be affected by declining print advertising.

“Management of costs remains a priority and helped to mitigate the impact of the revenue decline experienced in the quarter,” Holland said in a statement.

“On a positive note, distribution revenue grew in the quarter and profitability from digital activities increased. In addition, an increase in interest rates in the quarter is providing some welcome and meaningful reduction in the pension deficit.”

Holland said Torstar is pursuing opportunities including building its Metro franchise of community newspapers across Canada the introduction of the paywall at the Toronto Star’s website.