In a news release filed with the Securities and Exchange Commission, Reed said:
“We are very pleased with GateHouse Media’s performance in the third quarter. Our strategy of focusing on strong local media franchises in geographically diverse, small markets has allowed us to significantly outperform the newspaper industry and show resilience in a challenging advertising environment..”
“We believe that most of the current advertising slow down in small markets is cyclical. When the real estate and automotive categories begin to recover we will be positioned to recapture revenues due to our strong local franchises, penetration rates and our ability to deliver results to advertisers through our print and online offerings.
“I am confident that we will maintain stability in our revenue base should the economic climate worsen. Our revenues and cash flows have proven to be exceptionally consistent throughout economic cycles and this provides a strong underpinning to our dividend policy. I am pleased to announce that our board of directors approved a $0.40 per share dividend (annualized to $1.60) for the fourth quarter that will be paid on January 15, 2008.
“We continue to execute on all phases of our strategy including accretive acquisitions, realization of synergies and strategic disposal of non-core assets. For example, we shuttered eight print plants in the third quarter, merging six into other GateHouse Media press plants and completely outsourcing the printing at the other two. We also closed on the sale of The Herald Dispatch in Huntington, West Virginia at a very attractive valuation. Finally, we announced entering into an acquisition agreement with Morris Publishing Group that will add meaningfully to our EBITDA and free cash flow per share.
“We also continue to execute on our online strategy. We recently added 10 full time company-wide online sales reps who have significantly strengthened our online marketing capabilities. We also launched Yahoo! HotJobs in our larger markets and initial results have been very strong. HotJobs is scheduled to be rolled out in all of our markets by the end of the year. Online revenues at those properties owned by GateHouse Media on January 1, 2007, excluding properties acquired during the year that we are currently transitioning to our platform, are up 42.3% over the same period in 2006
GateHouse Media owns The Carthage Press, Neosho Daily News, Neosho Post, and Big Nickel, among other publications in southwest Missouri, and recently bought the Pittsburg Morning Sun.