Thursday, July 14, 2005

KRI Q2

Knight Ridder's earnings have the same theme as that of Gannett, namely cyclical part of the business was dragging the group lower in spite of good internet properties such as Career Builder etc. Newprints costs spike has also wrecked havoc to margins as circulation is down.

The other point that I wanted to make on GCI's post was that June advertising trend was down versus May and it fell off faster than anticipated. KRI experience the same case in June. This is important given the overall Retail Sales stats that came out this morning that in my opinion was much skewed by GM's incentives. Many bulls will point to strong consumer as the main pillar in this recovery, although I would like to caution you that Corporate advertising spending leads the economy 3-6 months ahead of the consumer cycle.

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