Lee Enterprises closed the Missoula Independent just before 8 this morning.
Staff were notified via email and phone messages, though many showed up to work only to find the doors locked.
Appointments would need to be set to retrieve any personal belongings, or Lee offered to mail them to former staff members.
Just seven hours before, editors were making some final tweaks to this Thursday’s edition of the paper.
That edition will not be appearing now, and the Indy’s website has already been taken down, with a redirect link to the Missoulian.
The Missoulian is of course owned by Lee Enterprises as well, having been sold to them by Matt Gibson a couple years earlier.
Gibson was the one responsible for turning his old employees away at the door.
There are a lot of sad and sorry people this morning, and many in Missoula are wondering where they’ll get their news.
The reason given for the Indy’s closure was that it was losing money.
Nothing was mentioned about the Indy staff and their recent efforts to unionize for job security.
I personally believe that was the main motivator for the Indy’s closure: their audacity in challenging a corporate behemoth by unionizing.
I further believe this because I spent some time this morning digging into the financial condition of Lee Enterprises.
One of the most important things to remember about Lee Enterprises is how badly they were doing, and how they turned things around.
- In 2011 the company reported a $146 million net loss for the year.
- In 2012 they lost $16 million and in 2013 they lost nearly $78 million.
- Things turned around in 2014, as the company reported a net income of about $7 million.
- By 2015 they had a net income of $24 million; in 2016 it was $36 million and last year we saw the company report $28 million in net income.
Currently the company’s stock price is $2.70 a share.
Since the Indy closed this morning, the stock has gained 5 cents in value.
The last real high point for the stock was in 2007, when it was at $32 a share. Its highest price all time was in 2004, with $47 a share.
Let’s dig further.
During the first quarter of this year, Lee Enterprises earned $35.3 million from its 50 media markets.
Those earnings fells substantially in the second quarter, however. They made just $2.5 million.
Still, the company stated that “trends in virtually all of our revenue categories improved, and we are pleased with the positive momentum we generated in the second quarter.”
I can’t find any financial information on the Missoulian or the Indy.
If we look through the 98-page Lee Enterprises Annual Report for 2017 we don’t find any mention of individual papers.
We do know that Lee made $28.6 million in net income for last year.
That comes out to about $584,000 for each of the 49 media markets that Lee is still operating in.
One of those is Missoula, though that might encompass the greater Western Montana area.
Either way, it seems that the Missoula market should be making some kind of profit for Lee, and the Indy was a big part of that.
Lee mentions in their annual report that 58% of their 2017 revenue was derived from advertising and marketing services.
This is mostly print ads as well as the ads we get digitally via desktop, mobile and tablet.
Digital ads for retailers account for 60% of the total digital advertising that Lee gets.
Print ads are doing poorly, however.
In 2017, Lee saw its print ad revenue fall by $39 million, or 10.6%.
The company states that “the decrease in retail advertising is due to continued softness in print advertising demand resulting in reduced advertising volume primarily from large retail, big box stores and classifieds.”
The 9.4% gains in digital retail ads somewhat offset these losses.
But that in turn was mostly wiped out by a $12 million decrease in classifieds revenue, or 12.2%. This was due to a “reduction in print advertising from automotive, employment and real estate in most of our markets which combined, declined 18.3%.”
2016 saw similar losses in print revenues.
The Missoula Independent was a print paper, and to make it worse, it only came out once a week.
While it’s true that Lee’s reporting consistent levels of net income year after year, it is seeing a huge drop in print advertising…revenue that’s sometimes not made up via digital.
The Missoulian has experienced this, and so has the Indy.
While those losses alone are something to be concerned about, it was the staff’s own decision to unionize that ultimately resulted in their downfall…revenue being the safe and accepted scapegoat.
Indy staff members should have known when they joined a union that they would eventually lose their jobs.
The Missoulian had been shedding jobs for years, so the writing was on the wall. A further sign came when it was reported the Indy staffers would be moving into the Missoulian building.
But the Indy staffers held out hope, and even had some kind of bargaining meeting set up with Lee officials for next week.
That meeting won’t be happening now, nor will anymore editions of the Indy.
But all hope is not lost.
I started this blog in 2013 and a few years later, the Missoula Current started up.
They had a pretty tough go of it, and Martin Kidston even offered me a chance to write some articles.
It was probably wise that we didn’t go through with that.
Since the blog started a couple years ago it’s really changed into more of a local news site.
I rarely have to click on Missoulian articles anymore, mostly because the Missoula Current is so good at getting those same stories up…and for free.
If they don’t have them, I know the two local TV stations or one of the radio stations will.
I even heard the Missoula Current advertising on Z100 on the radio last night while I was driving around.
If you look at the ads on their site, you can tell that they have a lot of trust in the community. Big name businesses and organizations are advertising, and quite a few of them.
The number of writers on that site has increased, and I’m sure their traffic has as well.
On top of that, I see that the Montana Free Press is trying to hire writers to get that blog/news site going again…likely in time for the mid-terms and the subsequent legislative session.
Both John Adams at MFP and Martin Kidston at the Current were former reporters, both of whom got shunned by their corporate employers…Gannett for Adams and Lee for Kidston.
Both stuck their thumb in the eye of those employers and are challenging them for local digital advertising revenue…or the bread and butter of Lee.
I would suggest to the disgruntled, angry, and still-wondering-what-to-do Indy reporters that they join forces with those two men, and stick their thumb in Lee’s eye, too.
People are hungry for alternative viewpoints, other-sides-of-the-story, and the many, many local happenings that are falling through the cracks, never to be reported upon.
People say the news business is dying, but it’s really just the print news business that is.
Some have made the switch to the online-only world, and while they struggled at first, they’re going pretty good now.
Perhaps some of these laid-off Indy staffers will do the same.
“Form 10-K.” Lee Enterprises, Incorporated. 24 September 2017. https://bloximages.chicago2.vip.townnews.com/lee.net/content/tncms/assets/v3/editorial/a/d9/ad936880-014a-11e8-a482-57c9f5ad0989/5a68f5c6df3ea.pdf.pdf
“Lee Enterprises net income from 2011 to 2017 (in million U.S. dollars).” Statista. Retrieved 11 September 2018. https://www.statista.com/statistics/630442/lee-enterprises-net-income/
“Lee Enterprises reports 2018 first quarter results.” Lee Enterprises. 1 February 2018. http://lee.net/financial/lee-enterprises-reports-first-quarter-results/article_e7e2b05a-06df-11e8-b932-0f735f488594.html
“Lee Enterprises reports second quarter results.” Lee Enterprises. 3 May 2018. http://lee.net/financial/lee-enterprises-reports-second-quarter-results/article_8364a5b4-4e58-11e8-a2e9-53ca3e5866c7.html
“Lee Stock Price.” Market Watch. Retrieved 11 September 2018. https://www.marketwatch.com/investing/stock/lee