Bob Cox Fri, 16 Nov 2012 22:02:00 GMT The financial picture at FP Fri, 16 Nov 2012 22:02:00 GMT <p> So how is the <em>Winnipeg Free Press </em>doing?</p> <p> This is a question that comes up frequently, and has arisen again recently in light of the fact that we have reduced staffing levels in the face of lower revenues. There have been suggestions in some quarters that the paper has been callously raking in profits while eliminating jobs.</p> <p> As you can imagine, I disagree with this characterization, but you do not have to take my word. The <em>Free Press </em>is probably the most transparent newspaper in Canada for anyone who wants to know since it is by far the largest newspaper business owned by <a href="" rel="nofollow">FP Canadian Newspapers Limited Partnership (FPLP)</a>.</p> <p> You can check out the 3<sup>rd</sup> Quarter results of FPLP and FP Newspapers Inc., the publicly traded entity that owns 49 per cent of FPLP, in a <a href="" rel="nofollow">report released this week</a>.</p> <p> The report outlines what we have been doing to prudently manage the company in the face of challenging times for newspapers, the steps we are taking to respond to try to avert future problems and maintain a solid base for our daily and community newspapers and other publications.</p> <p> It is never easy for non-accountants to make their way through a public financial report, so I will provide a bit of guidance.</p> <p> On page 2 you will find an outline of the measures we have taken this year. They include the elimination of 30 positions in the businesses that we operate.</p> <p> We have not taken any decision to reduce staff lightly.</p> <p> The 3<sup>rd</sup> Quarter report notes that advertising and circulation revenues, which make up about 92 per cent of our total revenues, are down 1.3 per cent from the same three months of 2011.</p> <p> That is an improvement from the 2<sup>nd</sup> Quarter when such revenues were down by 7.2 per cent. But we still faced a tough slog to keep expenses in check. With all the moves we made, including a number of non-staff changes, expenses for the 3<sup>rd</sup> Quarter, excluding non-recurring restructuring charges, were lower by 1.6  per cent compared with the same period in 2011. Expenses like wage increases go up even when revenues do not, due to annual contracted increases in labour contracts.</p> <p> Also, keep in mind that a 1 per cent decrease in revenue for the 2011 year would amount to a reduction of $1.1 million, and a 1 per cent decrease in operating expenses would result in a reduction of $0.9 million, resulting in a decline in the operating earnings of the company of $0.2 million.</p> <p> There are also cash funding requirements in excess of operating expenses, the biggest ones being the cost of the pension plan enjoyed by employees of the <em>Winnipeg Free Press</em>, debt interest, debt principal repayments and capital investment required to sustain existing operations.</p> <p> For pensions, the company is required to make up shortfalls in the plan that guarantees defined benefits to retirees. Those shortfalls have become quite large in the era of ultra low interest rates. On page 13 you will see that pension funding in excess of accounting operating expenses for the past 12 months has totalled $2.8 million. It was $1.2 million in the full 12 months of 2011.</p> <p> Page 13 of the 3<sup>rd</sup> Quarter report shows how the distributable cash of FPLP is arrived at. This is the amount that is actually available for investors once the company has paid taxes, funded pensions, made loan payments, and covered the cost of maintaining and upgrading buildings and equipment.</p> <p> It is $8.7 million for the past 12 months ending September 30, 2012. If you look at the <a href="" rel="nofollow">3<sup>rd</sup> Quarter report for 2011</a>, you’ll see it was $11 million for the previous 12 months at that time. That is a drop of 20.2 per cent.</p> <p> These numbers and trends have guided FP managers as we determine the future course of the company.</p> <p> We know that paying careful attention and taking action now is a requirement, not an option, to try to restructure the business model in the best long-term interests of all stakeholders, including employees, readers, advertisers, investors, lenders, suppliers, community groups and the many others for whom how the <em>Free Press </em>is doing is an important question.</p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:b7b24a61-bb59-4405-a1be-9bdd29158479 A colourful history of the Winnipeg press Thu, 08 Nov 2012 18:20:00 GMT <p> An old iron hand press sits just outside my office at the <em>Winnipeg Free Press</em>, a reminder to all of us here of the long legacy of this newspaper, which will mark 140 years of continuous publication later this month.</p> <p> The press was bought in New York by William Fisher Luxton, taken by train across the United States to Minnesota, then north on a Red River steamboat before finally ending up in a shack on Main Street where it churned out the first edition of the <em>Manitoba Free Press </em>on November 30, 1872.</p> <p> If you want to know how little the news has changed since then, look at what the paper wrote about -- the first main story was the re-election of General Ulysses S. Grant as President of the United States of America.</p> <p> Journalists and newspapers rarely look back at their history. Our job is the present, what is happening now. Getting today's news out is more important than remembering yesterday.</p> <p> So it is a rare treat to get the current edition of <a href="" rel="nofollow"><em>Manitoba History</em></a>, the journal of the Manitoba Historical Society, published three times a year devoted to the history of Manitoba and Western Canada.</p> <p> The current edition is dedicated to 125 years of the Winnipeg Press Club, and by extension much of the remarkable history of the news business in Winnipeg.</p> <p> Staring from the cover is John Dafoe, the legendary editor of the <em>Free Press </em>who established a national and international reputation for the paper under his guidance for much of the first half of the 20<sup>th</sup> century.</p> <p> (The magazine is free for downloading to anyone who is a Manitoba Historical Society member -- $40 annual membership. Hard copies can be purchased at the Dalnavert Museum in Winnipeg, the Daly Museum in Brandon, McNally-Robinson Booksellers and the University of Manitoba Bookstore.)</p> <p> The edition is being launched tonight with a reception at Dalnavert.</p> <p> Anyone interested in Winnipeg’s history will be fascinated by the essays on everything from how Winnipeg invented the media to how pioneering women journalists such as Cora Hind, long-time agricultural editor of the <em>Free Press</em>, banded together in the early 1900s and pressed for social, legal and political reforms surrounding women’s rights and plight.</p> <p> You can learn how Ben Batsford became an internationally syndicated cartoonist after he started drawing a cartoon called Unk and Billy in the<em> Free Press </em>in the early 1920s, making the <em>Free Press </em>the first Canadian newspaper to inaugurate a daily comic strip of its own.</p> <p> You can learn how a managing editor of the <em>Free Press </em>kept the news of Queen Victoria's death from Winston Churchill in order to hear the end of a speech by the British politician. Churchill visited Winnipeg in January 1901 and was speaking at a Press Club event when the editor was handed a cable announcing the Queen's death. He kept the message firmly in his pocket until his distinguished speaker was finished!</p> <p> That last story is actually something that may just be Press Club legend, rather than reality. But embellishment is often part of the stories journalists tell about themselves. You will find a bit of that sprinkled throughout the other stories in the magazine as well – all the better to make them a good read!</p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:ad387537-3122-4fd1-9b42-1cfe1cd94881 Newspapers lose a superhero Tue, 23 Oct 2012 20:19:00 GMT <p> This space is reserved for serious journalism issues, and I am used to fending off attacks on the newspaper industry, but I am not quite sure how to take the most recent blow.</p> <p> Superman, the alter ego of every nerdish male reporter, has quit his job at <em>The Daily Planet</em>.</p> <p> According to <a href="" rel="nofollow">a story in <em>USA Today</em></a>, in the most recent issue of the <em>Superman</em> comic series, mild-mannered reporter Clark Kent quits the Metropolis newspaper that has been his employer since the DC Comics superhero's earliest days in 1938.</p> <p> Blame it on management. Kent apparently quits in a huff in front of the entire newsroom after a rant about the state of journalism.</p> <p> It is part of efforts by the comic's creators to modernize the series. There is no word yet on Superman's new occupation, but he may end up in a more modern journalism job.</p> <p> You won't be surprised to learn that I think the Superman writers are making a mistake, and it's not just because I was sometimes called "Clark Kent" when I was a 20-something newspaper reporter who wore glasses with large frames.</p> <p> The search for truth and justice is as much a part of newspaper reporting today in 2012 as it was when co-creator Joe Shuster first gave Superman a human occupation at a newspaper modelled on his own former workplace, the old Toronto <em>Daily Star</em>.</p> <p> And newspapers could use a hero like Superman, given all the people predicting our demise.</p> <p> The fact is that, even with diminished resources, newspapers are still your best bet for staying abreast of what is happening in your community.</p> <p> Other media have cut coverage to an extent that really would make Clark Kent angry.</p> <p> The <em>Free Press </em>is still the largest newsroom providing the most comprehensive coverage of our Metropolis, better known as Winnipeg.</p> <p> Quite often our old-fashioned newspaper reporters are the only journalists keeping close watch over City Hall, the Manitoba Legislature or the Law Courts.</p> <p> As for modern, most newspaper journalists Tweet, blog, file digital stories, prepare online videos -- as well as putting ink to paper each day for our own <em>Daily Planet</em>.</p> <p> Quite apart from my crush on Lois Lane, I have always loved the Superman story. I see it as a metaphor for the power of newspaper journalists to do great things.</p> <p> Clearly I was seeing it from my own perspective.</p> <p> These days, I really don't know what's going on at all with the franchise. There are not many details out about the new movie, <em>Man of Steel</em>, which is due out in 2013. But a <a href="" rel="nofollow">film trailer</a> shows star Henry Cavill living in what looks like a Newfoundland fishing village and throwing lobster traps off the back of a boat.</p> <p> A plot summary still describes Clark Kent as a 20-something journalist, but there is no mention of newspapers. Pity.</p> <p>  </p> <p> *This blog was changed October 24, 2012 to correct the year that the Superman comic first appeared.</p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:6b49dc96-046a-41d4-8f92-ae2fe62e544b Half a million Winnipeggers read newspapers Fri, 12 Oct 2012 15:02:00 GMT <p> Half a million people read newspapers regularly in Winnipeg.Two out of every three Winnipeggers read the <em>Winnipeg Free Press </em>at least once a week.</p> <p> You might be surprised to read these facts, given some of the attention the <em>Free Press </em>has gotten in other media -- and even in our own pages and online posts -- over recent staff reductions.</p> <p> But the real numbers, complete with full-colour graphs, are in a <a href="" rel="nofollow">survey</a> made public this week by the National Audience Databank better known as NADbank.</p> <p> When you consider all newspapers, four out of five Canadians read a newspaper at least once a week either in print or online. In Winnipeg, 78 per cent read a printed paper weekly, making us the most prolific newspaper readers in the country.</p> <p> I went over the NADbank survey pretty closely, as you can imagine, and it was hard to find evidence that people are abandoning newspapers, which our critics often repeat as if it was a proven fact.</p> <p> In 2008, 72 per cent of Canadians surveyed by NADbank said they read a printed paper at least once a week. This year, 71 per cent said they do so -- essentially no change.</p> <p> Anyone who doubts the impact newspapers are having should take a look at a <a href="" rel="nofollow">presentation</a> by the Canadian Newspaper Association looking at the facts about the business.</p> <p> Before you say it -- no, I do not have my head in the sand. I am not pretending that newspapers are not changing and making some tough, necessary decisions to ensure their survival in the future.</p> <p> Our own company, FP Newspapers, is public and regularly releases our financial results. We discussed what is happening and what we are doing in our <a href="" rel="nofollow">2nd Quarter Report</a> released in August. (See page 3 under 'Outlook')</p> <p> I regret any staff reductions, but I know that like any business we have to adjust as our revenues change. And while we have great readership, there is no denying that whole areas of printed newspaper revenues -- such as general classified advertising -- are no longer around.</p> <p> I also know that adjusting is not the same thing as 'decline.' I'm pretty sure McDonald's would not be operating today if it had the same menu and business practices that it did in 1975.</p> <p> Newspapers also must operate differently -- and already are doing so. <em>Metro</em>, the newest newspaper on Winnipeg streets, owns no printing presses, has no editorial production staff in Winnipeg, and is not delivered to people's homes.</p> <p> No one could have conceived of such a paper when I started in daily newspaper journalism in 1983.</p> <p> In fact, there are whole areas of the <em>Free Press</em> that no one could have imagined in 1983, including our growing digital operations that attract close to 30 milllion page views every month to our online sites and mobile applications.</p> <p> We will continue to change here at the<em> Free Press, </em>but we will never waver from our goal of providing the best package of news information and advertising that can be found in Winnipeg.</p> <p> That's why Winnipeggers are such great newspaper readers!</p> <p> <em>Note: This blog post was originally published in September 2012 but was deleted in error. This is a reprint of that original post.</em></p> <p>  </p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:ede6903c-691f-4720-852a-f37466a785c8 Lou Grant on a bicycle in heels Tue, 24 Jul 2012 16:37:00 GMT <p> This is Margo Goodhand’s final week as editor of the <em>Winnipeg Free Press</em>.</p> <p> She is leaving after 5 years on the job. It’s a relatively short tenure. The paper has had only 14 editors in 140 years. But it’s enough time, she says, for her to have held this important post.</p> <p> Margo is not retiring. She is young enough, curious enough and energetic enough to want to do other things before retiring. She is also brave enough to leave her job before those other things are clearly defined.</p> <p> At first glance Margo is far from the growling, hard-drinking, cigar-chomping, fedora-wearing editor of newspaper lore. She is pleasant, polite and a fitness buff. She rides her bike to work in Inkster Park from Wolseley in just about every kind of Winnipeg weather, packing her dresses and heels for a quick change at the office.</p> <p> Look beyond the surface, though, and you’ll see that inside she is every bit as tough, stubborn and dedicated as any Lou Grant wannabe.</p> <p> She leads staff by example. Every Christmas season Margo spent a week starting a breaking news reporting shift at 6:30 a.m., running around to fires, stabbings and car accidents, filing quickly to She did this because she felt that every staff member, including senior editors and big-shot columnists, should get a refresher in basic reporting each year, and she was not about to excuse herself.</p> <p> She has her quirks. She is notoriously late for meetings. I start things on time and I routinely begin the daily operations meetings at 9:30 sharp without her. The clock in her office is set several minutes ahead so she can be late according to her clock and still be on time. The trick never seems to work.</p> <p> Margo, a Winnipegger born and bred, came home from Medicine Hat, Alta., and joined the <em>Free Press </em>in 1989. I missed her my first time here, as I left in 1987. I didn’t miss her the second time around, asking her to become the deputy editor shortly after I returned to the paper as editor in 2005.</p> <p> I asked her to be editor in 2007, announcing it the same day that I became publisher, ensuring no one would notice my appointment. Sure enough, the headline read: “Free Press appoints its first ever female editor.”</p> <p> The editorial department must not have asked for her approval on the story, since Margo does not seek the limelight. She has that typically Midwestern characteristic of playing down everything she does.</p> <p> I have talked elsewhere of what the paper has accomplished under her guidance – including getting recognized as the best news organization in the country by the Canadian Journalism Foundation.</p> <p> You won’t hear Margo brag even about that, unless it’s in the context of praising and thanking everyone who helped make it happen.</p> <p> She’s also not likely to talk about how hard she fought with fellow members of the National Newspaper Awards committee to allow more nominations for the prestigious prizes so that smaller newspapers with fewer resources could get much-deserved recognition. That particular effort was dubbed the “Red River Rebellion” by some of her eastern detractors.</p> <p> She has also been the driving editorial force behind several <em>Winnipeg Free Press </em>books on subjects such as the Manitoba Legislative Building and the Winnipeg Jets. Even in her final days she has been busy with another book, this one on the Jets’ first season.</p> <p> She insists she’ll see the project through, even after she leaves, which shows how much she cares about the work she has done here.</p> <p> Margo has come back to the <em>Free Press </em>before. She quit in 1990 to have a baby, got taken on by the <em>Winnipeg Sun </em>and then was back in 1991, just in time to get laid off. She went back to the <em>Sun</em>, then quit that job to have another baby. She landed back on her feet at the <em>Free Press </em>before her original layoff notice expired.</p> <p> The experience shows two things – how determined Margo is and how much she values her family and activities outside the office. She won’t have trouble slipping into a life that includes more time at her treasured cottage at Victoria Beach.</p> <p> So I doubt she’ll be back again, applying for a copy editor’s job on the rim.</p> <p> I’ll miss her. We all will.</p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:5f70452f-10b8-4033-8058-a93f6b20d624 A vote of confidence from Warren Buffett Mon, 16 Apr 2012 16:25:00 GMT <p> Newspapers have suffered in recent years from a long line of critics who like to predict their demise.</p> <p> So it is great news that no less savvy an investor than Warren Buffett has decided to give the industry a high-profile vote of confidence by increasing his ownership of newspapers.</p> <p> Buffett’s <span class="company">Berkshire Hathaway Inc. is <a href="">buying 63 daily and community newspapers </a>from Media General Inc., a company that is selling its papers to alleviate a heavy debt that was threatening the firm's future.</span></p> <p> <span class="company">Berkshire is paying $142 million, as well as making a $400-million loan to Media General, which also owns TV stations in many southeastern U.S. markets.</span></p> <p> <span class="company">This is a tiny investment for Berkshire, but a great boost for newspapers in general.</span></p> <p> <span class="company">Warren Buffett does not invest in something to lose money.</span></p> <p> Media General’s shares soared 38 per cent right after the announcement.</p> <p> Buffett has been involved in papers for a long time as an investor in the <em>Washington Post </em>and owner of the <em>Buffalo News</em>.</p> <p> He also bought his hometown <em>Omaha World-Herald </em>last year.</p> <p> That purchase was seen more as a sentimental one than a sound business decision.</p> <p> His further expansion shows a more serious approach to buying papers.</p> <p> I bet that what Buffett has noticed is how much newspapers have changed.</p> <p> They are not what they used to be, and not worth the kind of prices they fetched a few years ago.</p> <p> Most have continued to make money on operations, but many struggled because of debt loads taken on by owners who paid a lot for newspapers.</p> <p> Today they have cut down the big cost structures they had in the past and they are focused on what they do best -- reaching audiences with great local content in a variety of ways, be it in print, at your desk, on your phone or on your iPad.</p> <p> I assume there will be some pretty cynical comments on this blog.</p> <p> The digital world is filled with people who say newspapers are history.</p> <p> There is even a mini-industry of predicting the year that printed newspapers will disappear, and I've heard as soon as 2016.</p> <p> Even newspapers writers themselves use over-the-top langauge.</p> <p> The New York Times recently started a story on newspaper ownership by asking: "Is there anything more forlorn than the American metropolitan newspaper?"</p> <p> Actually, I can think of a lot of things.</p> <p> I am the first to acknowledge how fast the media world is changing generally and how newspapers must also change.</p> <p> Just take a look at what the <em>Free Press </em>does digitally, or at our printed classified ad section, if you want to know how much papers have changed in only a few years.</p> <p> But I have always been puzzled by why people ignore some basic facts.</p> <p> The percentage of Canadians reading a newspaper in print or online has been unchanged for the past five years.</p> <p> It has been 77 per cent or 78 per cent every year since 2007, according to NADBank, which surveys people across Canada.</p> <p> The actual number of readers has risen over that time to 15.1 million from 14.4 million, an increase of 4.9 per cent.</p> <p> At the <em>Free Press</em>, our print and online audience was 415,900 in 2011, according to NADBank, almost exactly what it was in 2009 -- 411,700.</p> <p> Our print audience was 391,600 in 2011, almost the same as in 2009 when it was 389,300.</p> <p> We are working hard to keep that audience, and to adapt to how they are consuming news and information.  </p> <p> We never forget our core mission, which is to serve our community.</p> <p> Buffett knows this, and said so after the Media General purchase.</p> <p> "In towns and cities where there is a strong sense of community, there is no more important institution than the local paper," he said.</p> <p> Strong sense of community? That sure sounds like Winnipeg to me. Thanks Warren.</p> <p>  </p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:814c9b60-4eb5-4f3c-8708-0fa68b8b8fe5 He was a true newspaperman Thu, 05 Apr 2012 17:05:00 GMT <p> Winnipeg newspapers lost one of their own this week.</p> <p> Pat Flynn, a veteran of the Winnipeg Free Press, Winnipeg Sun and Winnipeg Tribune, passed away.</p> <p> Most Winnipeggers won't know his name. But Pat was the guiding hand behind much of what they read in local papers since the 1970s. At various times in his career he reported, wrote, assigned reporters to cover the news and worked as the night editor, overseeing everything that got into the Free Press.</p> <p> The term newspaperman has gone out of fashion, but it described Pat perfectly. He was a good newspaperman.</p> <p> He learned the business during the heyday of the rivalry between the Free Press and the Tribune when the newspapers competed daily for readers by chasing and nailing down the best scoops.</p> <p> Many of us at the Free Press got our first assignments as rookie reporters from Pat when he worked on city desk.</p> <p> He kept his reporter's skills as an editor and manager, making sure he had the facts and knew what was happening before acting.</p> <p> As a new Free Press reporter in 1984, I was a bit nervous when I saw Pat approach my desk one morning, barely giving me time to sit down after I arrived in the newsroom. Something was wrong. Before commenting, though, Pat asked a key question: "Are you half an hour late or are you half an hour early?" Luckily, I was half an hour early and Pat, happy with my answer, returned to city desk.</p> <p> Another morning I got a call from him to apologize for my front page byline. As any reporter knows, editors generally don't apologize. And it's unheard of for an editor to apologize for putting a reporter's story on page one. But in this case my byline had appeared as "Box Cox." That byline is one of the reasons why this blog goes by the same name.</p> <p> While Pat was known to most of us as an excellent editor, he was also an excellent writer. He ended his career at the paper as the travel editor and writer, a job he loved.</p> <p> Pat had recently started writing for Winnipeg Boomer magazine, a publication produced here at the Free Press.</p> <p> His last article appeared the <a href="">April edition</a>  (on page 16). In it, Pat writes about Wreck Beach, Vancouver's nude bathing area.</p> <p> Visiting a nude beach had always been on Pat's bucket list, the collection of experiences he wanted to have before leaving this world.</p> <p> So Pat stripped down and joined the crowd sunning themselves.</p> <p> The result was the kind of journalism Pat was known for -- informative, detailed, easy to read and entertaining. The product of a true newspaperman.</p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:8992e97b-54ee-46b7-8915-f9fcc357bf39 News Café celebrates first anniversary Tue, 27 Mar 2012 16:02:00 GMT <p> There is a well-known phenomenon in which people give themselves a disproportionate amount of credit for what they have done.</p> <p> A husband thinks he does 50 per cent of the housework while his wife thinks she does 90 per cent of the housework. Somebody is wrong, since the total is 140 per cent of the housework – and let’s face it, nobody’s house is that clean.</p> <p> One way of resolving such a difference of opinion is simply to acknowledge that the perceived contribution of people to a task or project is going to add up to more than 100 per cent.</p> <p> I like that thought because, the laws of mathematics aside, success sometimes takes more than 100 per cent effort.</p> <p> At the Free Press this week, we’re marking the one-year anniversary of the opening of the Winnipeg Free Press News Café and it is truly an example of people’s contributions adding up to more than 100 per cent.</p> <p> Winnipeggers know the Café as a great place in the Exchange District to meet a friend for lunch, grab a Manitoba club sandwich,  maybe catch a newsmaker being interviewed or participate in a public forum on an issue such as homelessness.</p> <p> Newspaper people outside Winnipeg know it as an ambitious effort to expand what a newspaper does in the community, reaching out to engage readers in an innovative way.</p> <p> At the Free Press, we know the Café as a labour of love.</p> <p> Staff from across the paper have participated in developing the Café from a simple idea hatched two years ago to the thriving place that it is today.</p> <p> It has won accolades from publications such as Editor & Publisher and Forbes magazine. We have hosted newspaper visitors from as far away as Japan, interested to see first-hand how we are faring.</p> <p> I’m not going to use any names in this blog because as soon as I name one person I’ll have to name dozens.</p> <p> From the people who run the restaurant, to the journalists who do their work on public display, from the IT people who keep the technology running to the delivery people who keep the racks stacked with newspapers, everyone’s contribution is critical.</p> <p> I’d like to thank them all – and invite readers to stop by and find out what Canada’s first and only News Café is all about.<object data=",AAAAAFdYoqI~,XOSXSsnIVNwRuslSu-RqdTbpobEiBNy0&domain=embed&dynamicStreaming=true" height="412" id="ltVideoBrightcove" src=",AAAAAFdYoqI%7E,XOSXSsnIVNwRuslSu-RqdTbpobEiBNy0&domain=embed&dynamicStreaming=true" type="application/x-shockwave-flash" width="486"><param name="movie" value=",AAAAAFdYoqI~,XOSXSsnIVNwRuslSu-RqdTbpobEiBNy0&domain=embed&dynamicStreaming=true" /><param name="quality" value="best" /><param name="bgcolor" value="#ffffff" /><param name="wmode" value="transparent" /><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="flashvars" value="isVid=1&isUI=1&@videoPlayer=1537197977001&playerID=58616497001&playerKey=AQ~~,AAAAAFdYoqI~,XOSXSsnIVNwRuslSu-RqdTbpobEiBNy0&domain=embed&dynamicStreaming=true" /></object></p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:8ae31fa8-aa9f-4717-a6b8-cfb9052bc005 Measuring a good newspaper by the numbers Mon, 19 Mar 2012 21:33:00 GMT <p> The Free Press has hundreds of thousands of readers and most don’t measure how good the newspaper is by our balance sheet.</p> <p> But a healthy balance sheet is important as we maintain the high quality of journalism that our readers expect.</p> <p> Since most people find reading financial statements about as exciting as cutting their toenails, I’d like to walk you through the recently released results for our parent company, FPLP Canadian Newspapers.</p> <p> FPLP owns the Free Press, our Winnipeg weeklies, the Brandon Sun and the Steinbach Carillon. We release financial statements because 49 per cent of the enterprise is owned by FP Newspapers Inc., a publicly traded company.</p> <p> EBITDA, our basic measurement of earnings from operations, was $23.1 million in 2011, 5.9 per cent lower than in 2010. That is in line with many other newspaper companies, and better than some, over the past year.</p> <p> EBITDA stands for Earnings Before Interest, Taxation, Depreciation and Amortization. It is our basic yardstick because it measures the health of our operations, unencumbered by such issues as financing and taxation. These issues can be very important to a company – think of a firm with too much debt – but we take them out when looking at the core of the business.</p> <p> FPLP has maintained a relatively stable EBITDA over the past four years, with a high of $24.6 million and a low of $23 million over that time. That is a good performance in the current newspaper environment.</p> <p> We have managed costs and developed new sources of revenues. This past year, we acquired Derksen Printers in Steinbach, which publishes the Carillon and prints many of the newspapers you see around Winnipeg, including the daily Metro.</p> <p> There are some other important numbers in the financial statements.</p> <p> Distributable cash – the amount available for shareholders of FP Newspapers Inc. – dropped to 66.4 cents per share from $1.14 in 2010. This is largely because the company became a taxable corporation as of 2011, after many years of being an income trust. Income tax is now payable at source. Under the income trust system, which was discontinued by the federal government, income was passed on and fully taxable in the hands of shareholders.</p> <p> At first glance, the annual results from FP Newspapers Inc. seem a bit of a surprise – showing a net loss of $9.4 million. This is a loss on paper, as there was a $15 million non-cash write-down on the value of the company. This means that, on the books, the value of FP Newspapers Inc. is now around $45 million compared with about $60 million a year earlier. It is the company’s assessment of a fair value on its share of the overall FP Canadian Newspapers business.</p> <p> This does not change anything for shareholders. It is primarily a recognition of the reality of changes in the newspaper business, and the fact that there have been softer advertising revenues and there is less optimism about future growth rates. For an investor looking at FP Newspapers Inc., the share price in today’s trading was just under $5. The company paid 60 cents in dividends per share in 2011, meaning the annual rate of return at current prices is about 12 per cent.</p> <p> Another set of important numbers concerns the pension plan for employees. We are in the same position as most other private companies with pension plans – the cost of supporting the pension plan is rising. Returns on pension investments have suffered since 2008 and assumptions about longer-term returns have been lowered, meaning plans need more money now to meet future needs.</p> <p> At FP, we had to increase funding of the defined benefit plan in 2011 and we anticipate that additional funding will be required this year – in the range of $800,000 to $1.5 million more annually.</p> <p> This is a challenge we will continue to work through as we strive to manage this company well to support the quality journalism that we do.</p> <p> You can find our full reporting at <a href="" rel="nofollow"></a>.</p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:ec0d0926-92e8-49e5-b99d-66d139155c10 Crappy newspaper executives Thu, 23 Feb 2012 16:09:00 GMT <p> John Paton has been making waves again in Canada with a number of <a href="" rel="nofollow">interviews</a> and a <a href="" rel="nofollow">speech</a> to the Canadian Journalism Foundation in Toronto in which he talks about “crappy newspaper executives” as the biggest threat to newspapers since they are not doing enough to truly transform their business.</p> <p> Agree or disagree, it is must-read stuff for anyone who is interested in the future of newspapers</p> <p> Paton, a Canadian who is now CEO of a major U.S. newspaper company and advisor to Postmedia in Canada, has been beating a relentless drum for more than two years, telling the newspaper industry in no uncertain terms to embrace a digital first philosophy.</p> <p> He got a broader audience this week by appearing on <a href="" rel="nofollow">Jian Gomeshi’s </a>CBC radio program Q.</p> <p> Paton’s message is disconcerting, and uncomfortable for a lot of ink-stained, paper-loving newspaper people to hear.</p> <p> He preaches turning the apple cart upside down. Much to his credit, he practices what he preaches, bringing about significant change at the U.S. papers he oversees.</p> <p> He also attracts a lot of criticism.</p> <p> One article I read recently said Paton “and many others pushing the digital-only future grew up in the newsroom and if there’s one thing that’s true about a newsroom it’s this: Relying on the myopic viewpoint spawned by folks from the newsroom – from people who never sold an ad, delivered the paper in the morning’s wee hours or webbed up a press – will sooner kill a newspaper than save it.”</p> <p> Paton is often depicted as someone out to kill newspapers, but, as he points out, this is simply not true. He certainly sees printed newspapers as part of the future.</p> <p> One of the very interesting points he makes is that he sees “digital first” as a transitional strategy for newspapers companies, not an end-game strategy. In other words, pushing digital first is a way to create change as newspapers go about the messy business of reinventing themselves.</p> Blog:f885fdc6-0f45-4986-870c-e629152eda09Post:6bd4c79d-999e-4887-b38b-66702ab44ce1