October 28, 2011 / 12:43 PM / 7 years ago

UPDATE 1-Postmedia loss narrows; circulation, ad revenue slip

* Fiscal Q4 loss C$2.3 mln vs yr-earlier loss of C$48 mln

* National Post publisher focuses on digital strategy (Adds details on results, CEO comment, share price move)

TORONTO, Oct 28 (Reuters) - Postmedia Network (PNCb.TO), which operates Canada’s largest chain of newspapers, said on Friday its quarterly net loss narrowed, even as advertising and circulation revenue shrunk.

Postmedia, whose papers include the flagship National Post, as well as the Montreal Gazette, Ottawa Citizen and Vancouver Sun, said its net loss in its fiscal fourth-quarter came in at C$2.3 million, compared with a year-earlier loss of C$48 million, when results were hurt by restructuring and other charges.

Quarterly revenues for the quarter ended Aug. 31 fell to C$230.3 million from C$241.3 million.

The company, created last July to buy the newspaper assets of bankrupt Canwest, is attempting to cut costs by reshaping its titles for the digital age and increasing revenue from its websites, smartphone and tablets apps, and other services.

“In our second year, we must accelerate the growth of our digital first strategy and explore new ways to embrace the transformation critical to our success,” said Chief Executive Paul Godfrey, in a statement.

While advertising and circulation revenues in the latest quarter fell, the smaller digital business was a bright spot for the publishing company in the quarter. Digital revenue in the period rose to C$22.1 million, up from C$20.4 million.

Ownership of the assets, only transferred to Postmedia in mid-July last year, so corresponding figures for the year-earlier period combine results from both Postmedia and Canwest.

In the latest quarter the company made total debt repayments of US$8.2 million. As of that time, the company had outstanding long-term debt of US$340 million under long term credit facilities and US$275 million in senior secured notes.

Earlier this month, Postmedia said it had agreed to sell daily newspapers such as the Times Colonist, Nanaimo Daily News and Alberni Valley Times, along with 20 British-Columbia based community publications, to Glacier Media for C$86.5 million. It will use proceeds to repay debt.

Postmedia’s more widely-held Class B shares have fallen 47 percent over the last three months and closed Thursday at C$9 on the Toronto Stock Exchange. (Reporting by Euan Rocha; Editing by Frank McGurty)

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