The Gleaner Company recorded a net loss of $14 million in the first quarter of 2009.

This first quarter loss was on revenue of $923 million, a one per cent decline in sales when compared to the first three months of 2008. Many firms throughout the economy have been posting double digit declines in revenue.

Among the consequences of the soft economy is less spending on advertising and marketing. This has had a direct impact on media businesses.

The company, whose flagship is The Gleaner newspaper, remains optimistic about the future and its ability to remain the major player in Jamaica's media market.

"Given the uncertainty of the current economic environment, revenue predictions are difficult," said deputy managing director Christopher Barnes.

Profit from sangster's

"Business traditionally picks up after the first quarter and we continue to innovate the content of our newspapers to maintain the position of market leader."

Revenue from media operations, including The Gleaner and STAR newspapers, and the radio station, Power 106, declined by two per cent. But this decline was substantially offset by a 19 per cent increase in revenues by Sangster's Book Stores Limited.

"The company's media business showed a small after-tax profit of $14 million despite the challenging economic conditions, and the overseas subsidiaries have performed creditably," the company said.

It was partly in anticipation of the looming difficulties that The Gleaner Company last year aggressively begun to streamline its operations, including the write-off of nearly $368 million, representing the intangible assets of its overseas subsidiaries.

That write-down was the major contributor to the company's net loss of $445 million in 2008.

Cost of sales reduced

The Gleaner followed up earlier this year by trimming staff in Jamaica and introducing measures aimed at tightly managing costs.

These moves seem to be paying off. During the first quarter the group was able to reduce its cost of sales by approximately $18 million, a little under four per cent, compared to the corresponding period last year.

The upshot: a four per cent growth in gross profit to $451 million.

'Other operating income' of $34 million, fell from $93 million for the same period in 2008, when the group made a $42 million profit from the sale of its shares in spirits conglomerate Lascelles deMercado and Company.

The Gleaner Company kept its operating and administrative expenses for the quarter flat at $309 million. However, this was significantly off-set by a seven per cent rise in distribution costs, to $186 million, caused by higher petrol prices over the past year.

Barnes committed to drive the company to become more efficient in the current year.