Star-Bulletin annual sales at $17.4 million Gannett CEO's compensation up 41%
BY Rick Daysog
Advertiser Staff Writer
The Honolulu Star-Bulletin generates annual revenues of $17.4 million but the state's No. 2 daily newspaper still loses millions of dollars each year, according to financial data provided by the newspaper's owner.
Owner David Black officially placed the 117-year-old Star-Bulletin, its Web site and its Kāne'ohe printing facility up for sale on Monday after announcing that he was buying the larger Honolulu Advertiser.
An informational packet provided by Black's Oahu Publications Inc. to prospective investors offers more details about the Star-Bulletin's operations and finances.
According to the report, the Star-Bulletin distributes about 52,000 copies each day but only 37,000 count as paid circulation.
The Advertiser, the state's largest newspaper, has a daily paid circulation of about 115,000.
Star-Bulletin officials had said the newspaper has lost more than $100 million — or more than $40,000 a day — since Black took over the daily nine years ago.
The brochure noted that the losses average about $13.3 million a year. But those losses don't include taxes and depreciation. They also do not include profits generated by the Star-Bulletin's sister publication MidWeek and other weeklies, which are not being sold.
Star-Bulletin Publisher Dennis Francis could not be reached for comment yesterday.
Details of the Star-Bulletin's finances come as three potential bidders have made inquiries about acquiring the daily newspaper.
Gerald Kato, journalism professor at the University of Hawai'i-Mānoa, said revenue figures for the Star-Bulletin suggest that a scaled down version of the newspaper may be a viable option for a buyer.
A smaller newspaper with fewer staff or a newspaper that's a hybrid of an online newspaper whose print version is delivered two or three days a week might work, said Kato.
Newspapers in Detroit switched to a similar format in 2008 to reduce labor costs and newsprint expenses.
The Detroit News offers daily content online and delivers its print editions twice a week. The Detroit Free Press delivers its print edition three times a week while providing daily coverage online.
The U.S. Justice Department's antitrust division is requiring Black, who is from British Columbia, to make a good faith effort to sell the Star-Bulletin so he can buy The Advertiser and its $82 million printing press in Kapolei.
If Black is unable to sell the money-losing Star-Bulletin, he will merge it with The Advertiser, leaving O'ahu with only one daily paper.
The merger would result in hundreds of layoffs as the staffs of the two companies are combined.
The 600 Advertiser employees were given a letter on March 9 stating that most employees will be terminated when the sale closes. They will be offered temporary employment with a management company to continue to put out The Advertiser until the new owner takes over the operation.