Daily Journal Corp. (DJCO, Financial) filed Quarterly Report for the period ended 2009-12-31.
Daily Journal Corp. has a market cap of $93.8 million; its shares were traded at around $64.82 with a P/E ratio of 11.4 and P/S ratio of 2.3. Daily Journal Corp. had an annual average earning growth of 7.4% over the past 5 years.DJCO is in the portfolios of Wallace Weitz of Weitz Wallace R & Co, Bruce Berkowitz of Fairholme Capital Management.
Consolidated revenues were $9,858,000 and $9,811,000 for the three months ended December 31, 2009 and 2008, respectively. This increase of $47,000 was primarily from an increase in public notice advertising revenues of $717,000, partially offset by decreases of $248,000 (24%) in display advertising revenues and $200,000 (34%) in classified advertising revenues. The Company continued to benefit from the large number of foreclosures in California and Arizona, for which public notice advertising is required by law. The Company's smaller newspapers, those other than the Los Angeles and San Francisco Daily Journals ("The Daily Journals"), accounted for about 96% of the total public notice advertising revenues. Public notice advertising revenues and related advertising and other service fees constituted about 53% of the Company's total revenues.
Costs and expenses decreased by $411,000 (6%) to $6,701,000 from $7,112,000. Newsprint and printing expenses decreased by $134,000 (25%) primarily resulting from fewer subscribers and a decrease in the price of paper. Postage and delivery expenses decreased by $27,000 (7%) mainly because there were fewer subscribers. Other outside services decreased by $100,000 (11%) primarily resulting from reduced freelancers services and computer programming services by contractors who were used on Daily Journal projects that have been completed, partially offset by a net increase in the use of contractors for Sustain s internal development efforts.
Consolidated net income was $2,088,000 and $1,748,000 for the three months ended December 31, 2009 and 2008, respectively. On a pretax profit of $3,368,000 and $2,843,000 for the three months ended December 31, 2009 and 2008, the Company recorded a tax provision of $1,280,000 and $1,095,000, respectively. The Internal Revenue Service has been examining the tax returns for years 2002 to 2007 and has proposed an assessment that, if upheld, would result in disallowance of about $700,000 of previously claimed research and development credits. As of December 31, 2009, the Company had approximately $700,000 of unrecognized tax benefits, all of which would have an effective rate impact if recognized. The Company is continuing to contest the issue in the United States Tax Court, and the ultimate resolution of this dispute cannot be ascertained at this time. Net income per share increased to $1.51 from $1.22.
During the three months ended December 31, 2009, the Company's cash and cash equivalents, U.S. Treasury Notes and Bills and marketable security positions increased by $1,758,000. All the marketable securities are common stocks and bonds of other companies. As of December 31, 2009, there were unrealized gains of $32,308,000, almost all of which were in the common stocks. The cash provided by operating activities of $3,127,000 included a net decrease in deferred subscription and other revenues of $439,000. Proceeds from the sale of subscriptions from newspapers, court rule books and other publications and for software licenses and maintenance and other services are recorded as deferred revenue and are included in earned revenue only when the services are rendered. Cash flows from operating activities increased by $1,289,000 during the three months ended December 31, 2009 as compared to the prior period primarily resulting from the increase in net income of $340,000 and the decreases in accounts receivable of $1,560,000, partially offset by the decreases in accounts payable and accrued liabilities of $695,000.
As of December 31, 2009, the Company had working capital of $49,299,000, including the liability for deferred subscription and other revenues of $4,901,000 which are scheduled to be earned within one year and the deferred tax liability of $12,277,000 for the unrealized gains in the investments held by the Company. The Company believes that it will be able to fund its operations for the foreseeable future through its cash flows from operating activities and its current working capital.
Read the The complete Report
Daily Journal Corp. has a market cap of $93.8 million; its shares were traded at around $64.82 with a P/E ratio of 11.4 and P/S ratio of 2.3. Daily Journal Corp. had an annual average earning growth of 7.4% over the past 5 years.DJCO is in the portfolios of Wallace Weitz of Weitz Wallace R & Co, Bruce Berkowitz of Fairholme Capital Management.
Highlight of Business Operations:
During the three months ended December 31, 2009, consolidated pretax income increased by $525,000 (18%) to $3,368,000 from $2,843,000 in the prior period. The Company s traditional business segment pretax profit increased by $701,000 (24%) to $3,608,000 from $2,907,000 primarily because of an increase in the number of trustee foreclosure notices that were published in the Company s newspapers or for which the Company received a placement fee. Sustain s business segment pretax loss increased to $240,000 from $64,000 because of decreases in consulting revenues from governmental agencies.Consolidated revenues were $9,858,000 and $9,811,000 for the three months ended December 31, 2009 and 2008, respectively. This increase of $47,000 was primarily from an increase in public notice advertising revenues of $717,000, partially offset by decreases of $248,000 (24%) in display advertising revenues and $200,000 (34%) in classified advertising revenues. The Company continued to benefit from the large number of foreclosures in California and Arizona, for which public notice advertising is required by law. The Company's smaller newspapers, those other than the Los Angeles and San Francisco Daily Journals ("The Daily Journals"), accounted for about 96% of the total public notice advertising revenues. Public notice advertising revenues and related advertising and other service fees constituted about 53% of the Company's total revenues.
Costs and expenses decreased by $411,000 (6%) to $6,701,000 from $7,112,000. Newsprint and printing expenses decreased by $134,000 (25%) primarily resulting from fewer subscribers and a decrease in the price of paper. Postage and delivery expenses decreased by $27,000 (7%) mainly because there were fewer subscribers. Other outside services decreased by $100,000 (11%) primarily resulting from reduced freelancers services and computer programming services by contractors who were used on Daily Journal projects that have been completed, partially offset by a net increase in the use of contractors for Sustain s internal development efforts.
Consolidated net income was $2,088,000 and $1,748,000 for the three months ended December 31, 2009 and 2008, respectively. On a pretax profit of $3,368,000 and $2,843,000 for the three months ended December 31, 2009 and 2008, the Company recorded a tax provision of $1,280,000 and $1,095,000, respectively. The Internal Revenue Service has been examining the tax returns for years 2002 to 2007 and has proposed an assessment that, if upheld, would result in disallowance of about $700,000 of previously claimed research and development credits. As of December 31, 2009, the Company had approximately $700,000 of unrecognized tax benefits, all of which would have an effective rate impact if recognized. The Company is continuing to contest the issue in the United States Tax Court, and the ultimate resolution of this dispute cannot be ascertained at this time. Net income per share increased to $1.51 from $1.22.
During the three months ended December 31, 2009, the Company's cash and cash equivalents, U.S. Treasury Notes and Bills and marketable security positions increased by $1,758,000. All the marketable securities are common stocks and bonds of other companies. As of December 31, 2009, there were unrealized gains of $32,308,000, almost all of which were in the common stocks. The cash provided by operating activities of $3,127,000 included a net decrease in deferred subscription and other revenues of $439,000. Proceeds from the sale of subscriptions from newspapers, court rule books and other publications and for software licenses and maintenance and other services are recorded as deferred revenue and are included in earned revenue only when the services are rendered. Cash flows from operating activities increased by $1,289,000 during the three months ended December 31, 2009 as compared to the prior period primarily resulting from the increase in net income of $340,000 and the decreases in accounts receivable of $1,560,000, partially offset by the decreases in accounts payable and accrued liabilities of $695,000.
As of December 31, 2009, the Company had working capital of $49,299,000, including the liability for deferred subscription and other revenues of $4,901,000 which are scheduled to be earned within one year and the deferred tax liability of $12,277,000 for the unrealized gains in the investments held by the Company. The Company believes that it will be able to fund its operations for the foreseeable future through its cash flows from operating activities and its current working capital.
Read the The complete Report
