CEO: Journal Communications has no plans to go private
MILWAUKEE—Journal Communications Inc. has no plans to go private even though the media company has bought back more than a quarter of its shares in the past three years, executives told shareholders Thursday.
The company repurchased 20 million shares since February 2005. The strategy was profitable because the company paid less money for the shares than it raised by selling them at its initial public offering, chairman and chief executive Steven J. Smith said.
One shareholder who expressed concern about the strategy questioned whether there was more to it than executives were letting on. Smith insisted there was no hidden agenda.
"Conjecture about (going) private is just that," Smith said at the company's annual meeting.
Still, Smith left open the possibility for such a move in the future.
"It's also the responsibility of the board to think about our capital structure going forward," he added.
The board on Thursday also authorized the repurchase of an additional 5 million shares over the next 1 1/2 years. The company has 58.3 million shares outstanding.
The company, parent of the Milwaukee Journal Sentinel, said during its earnings announcement last week that it saw continued declines in publishing and broadcasting revenue because of slumping ad sales.
Aside from its daily newspaper, Journal Communications publishes 52 community newspapers and shoppers in Wisconsin and Florida. It also owns and runs 35 radio stations and 11 television stations in 12 states.
Smith reiterated his optimism for the company's future, saying the company was a major player in growth areas including Palm Springs, Calif., and Las Vegas.
Shareholders, including a number of disgruntled Milwaukee Journal Sentinel retirees, peppered Smith with questions about the stock's disappointing performance. Shares hit a 52-week low of $5.55 on Tuesday after trading as high as $14 last year.
Smith told them he believed the stock price undervalues the company's long-term outlook.
"We have to convince the investment community that we are a good long-term investment," he said. "We don't have an investment community right now that believes that, so that's our job to deliver."
Shares of Journal Communications rose 7 cents, or 1.2 percent, to close at $5.83 Thursday.
------
On the Net:
Journal Communications: http://www.journalcommunications.com
rising
falling 