COMPANY TOWN ANNEX

Bertelsmann Reports Profit Drop: The German media giant, which has enjoyed years of ever higher earnings, reported that interim earnings from ordinary activities plunged 16%. A statement that contains no detailed earnings figures quotes Chief Financial Officer Siegfried Luther as saying net profit will still rise for the fiscal year ending June 30 on “special effects, especially extraordinary income.” Group sales for the six months through December rose 5% to $7.35 billion. The company blamed investment in new businesses, high paper prices and sluggish consumer spending for the decline in earnings. A spokesman said the company will draw down reserves, which will allow it to show higher profit, but he declined to comment when asked if this means that 1995-96 operating profit will be lower than for the previous fiscal year.