The Successful Investor Hotline – Friday, November 2, 2012

Article Excerpt

TORSTAR CORP., $8.15, Toronto symbol TS.B, fell 8% this week after it reported lower-than-expected earnings. The company continues to see weak advertising demand at its newspapers, including its flagship paper, The Toronto Star. Strong competition and unfavourable foreign exchange rates are also hurting profits at its Harlequin book publishing subsidiary. As a result, Torstar’s earnings fell 44.1% in the three months ended September 30, 2012, to $14.1 million, or $0.18 a share, from $25.2 million, or $0.32 a share, a year earlier. The company continues to cut costs by laying off workers and selling surplus real estate. These moves should save it $5.2 million in the fourth quarter of 2012, and an additional $9.5 million in 2013. If you exclude severance costs and other one-time items, Torstar’s earnings per share would have fallen 21.6%, to $0.29 from $0.37. That missed the consensus estimate of $0.33. Revenue in the quarter fell 6.2%, to $355.3 million from $378.7 million. Revenue at the media division (which provides…