Times Mirror Profits Rise 19.8% in Quarter

Times Mirror Co. reported that its profits rose 19.8% in the second quarter, in part due to a one-time gain from the sale of a subsidiary and increased operating profits in television, cable and forest product operations.

The company, which owns the Los Angeles Times and diversified media holdings, reported profits of $70.6 million for the second quarter, up from $58.9 million a year ago.

Times Mirror noted that the gain in profits was powered by a $15-million pretax gain from the sale of an art and graphics subsidiary. Without the sale, earnings would have increased by 9.2%, it said.

Revenue for the quarter rose 5.8% to $746.8 million, up from $705.9 million in the year before.

President and Chief Executive Robert F. Erburu said the company saw “a softening in advertising in the final weeks of the quarter that is continuing in the third quarter. This weakness reflects the drift in the national economy.”

Erburu also said that, although operating earnings increased, the company’s earnings per share would have been less than a year ago were it not for the sale of the graphics division. That is largely due to a rise in the company’s effective tax rate to 46.2% and a temporary increase in the number of outstanding shares, he said.

Shares outstanding increased briefly when the company launched an employee stock ownership plan in April. Since then, Times Mirror has executed a tender offer to buy back 7.5 million shares, so that the total number of shares outstanding will actually decline for the year.

Operating results from different divisions were mixed. Second-quarter profits from newspaper publishing, the largest group, rose 3.2% to $72.7 million, but that increase reflected the addition of a new newspaper, the Allentown (Pa.) Call-Chronicle, acquired at the end of 1984. Cable-television profits rose 45% to $11.9 million, while newsprint and forest products rose 178% to $9.6 million. Profits from broadcast television grew 0.7% to $20 million.

Book publishing profits declined 10% to $11.1 million, while information services were flat. Profits from other operations, which include magazines and art and graphic products, dropped 48% to $3.1 million.