This is a summary of the second quarter fiscal 2008 earnings call conducted by Gannet Co, Inc (GCI: chart) on July 16, 2008

Management:

- COB, President& CEO: Craig A. Dubow
- CFO, EVP: Gracia C. Martore

Key Investor Issues:

- Revenues dropped 10% to $1.72 billion.
- Net income of $232.7 million or $1.02 a share, was down 36% from $366 million or $1.24 a share in 2007.
- The firm repurchased a total of 581,100 shares.

Year to Date Highlights:

- Revenues declined 9% to $3.4 billion from $3.74 billion in the prior year.
- Net income was down 26% to $424 million or $1.86 a share.

Second Quarter Highlights:

Operating revenues were $1.72 billion, a decline of 10% from $1.91 billion in 2007 as advertising revenues for publishing were about 13.5% lower.

- Advertising revenues were lower reflecting declines higher than that in the U.S. and about 12.5% in the U.K. in pounds led by lower spending in large traditional department stores drove.
-Retail was over 8% lower driven by weakness in the department store, furniture, and telecom cartegories.
- Operating expenses totaled $1.35 billion down 6.3% from $1.44 billion for the same quarter a year ago, driven by efforts to control costs and create efficiencies, lower newsprint expense, and the pension curtailment gain.
- Corporate expenses were $8.8 million, a 52.9% decline from $18.7 million in 2007 reflecting an allocation of part of the pension curtailment gain and continued strong cost containment efforts.

U.S. community publishing classified was down about 21%, reflecting declines of 30% in real estate, about 29% in employment.

- Interest expense totaled $44.0 million compared to $66.4 million for the year-ago quarter, with the 33.8% decline due to lower interest rates and average debt balances.
- These reflected a reduced level of investment income as well as the absence of gains on the sale of real estate and investments.
-Capital expenditures totaled approximately $30 million while cash and marketable securities were over $575 million, and total debt was $4.3 billion.

Product segmental analysis:

- Publishing: operating revenues totaled $1.53 billion and advertising revenues were $1.11 billion compared to $1.28 billion in 2007.
- Retail advertising revenues declined 8.3% while national revenues were 14.0 % lower and classified revenues were down 18.7% impacted directly from the economic slowdown.
- Advertising revenues declined 13.6% in the U.S. and 12.5% in pounds at Newsquest.
- Total publishing operating expenses declined 5.7% to $1.23 billion, reflecting continued cost control and efficiency efforts in the U.S. and the UK

- Broadcasting: revenues totaled $192.6 million versus $204.7 million in 2007, a 5.9% decline, reflecting a $3.1 million increase in politically related advertising demand.
- Online revenues were 17.1% higher compared to the second quarter in 2007.
- Operating expenses totaled $111.7 million, a 4.8% decline from the same quarter a year ago reflecting cost controls and an allocation of part of the pension curtailment gain.
- Television operating revenues were $184.7 million and expenses totaled $104.9 million, a 5.7% decline compared to $111.1 million for the same period a year ago.

Business outlook:

- The non-cash charges are expected to total in the range of $2.6 billion to $2.9 billion.
- Earnings per share will be reduced in the quarter due to the charges but they will not impact the company''s operating cash flow.

Key questions and answers from the second quarter fiscal 2008 earnings call conducted by Gannet Co, Inc (GCI: chart) on July 16, 2008

Peter Salkowski: What are your expectations going into the second half of the year on newsprint prices and newsprint expenses?