12:30PM New York – Gannett continues to face headwind as advertisers migrate away from print and television to the Internet.

Gannett Co, Inc. news and information company today reported revenues for the first quarter 2008 fell 8.4% to $1.68 billion from $1.83 billion a year ago.

First Quarter 2008 net incomes decreased 8.9% to $191.8 million or 84 cents a share compared with $210.6 million or 90 cents a share for the quarter of 2007.

Operating cash flow or operating income plus depreciation and amortization was $395.5 million.


Publishing segment operating revenues totaled $1.5 billion for the quarter. Advertising revenues were $1.1 billion compared to $1.2 billion in the first quarter of 2007. Retail advertising revenues were 7.8 % lower.

Advertising revenues from USA TODAY increased 2.1% compared to the same quarter of 2007.

Craig Dubow, Chairman, President and CEO said, ""We faced a very challenging advertising environment as the economy further weakened in the quarter, particularly in the latter half of March.""

Average diluted shares outstanding in the first quarter totaled 229.661 million compared with 235 million first quarter in 2007. Shares repurchased totaled approximately 1.5 million in the first quarter.

Revenue from broadcasting which includes Captivate declined 7% to $170.2 million from the same quarter in 2007. The decline reflected the softer economic environment and the absence of ad revenues related to the Super Bowl that benefited company owned CBS affiliates in 2007. The decline in ad revenue was offset in part by a $4.2 million increase in politically related advertising.

Interest expense for the first quarter declined 33.4% to $48.5 million compared to $72.9 million for the quarter of 2007, due to lower average debt balances and lower interest rates.

Gannett Co, Inc during the quarter, the company announced that it formed a partnership with Hearst Corporation, The New York Times Company and Tribune Company creating quadrantONE, an online advertising sales organization. on March 20, 2008.

Gannett (GCI: chart) stock traded as high as $28.48 before settling at 12 cents higher to $28.10.