Times says it lost money for fourth straight year in 2003

The Seattle Times, citing disappointing advertising revenues and the area's continuing economic slump, said yesterday the newspaper recorded its fourth straight year of financial losses in 2003.

Times spokeswoman Kerry Coughlin declined to disclose how much money the paper lost last year under its joint-operating agreement (JOA) with its crosstown rival, the Seattle Post-Intelligencer.

"We know we lost money under the JOA formula in 2003, but we haven't audited those figures and don't intend to make them public," she said.

Coughlin also declined to say whether The Seattle Times Co., which owns the Seattle paper and others in Washington and Maine, lost money last year. The Blethen family owns 50.5 percent of the company; the rest is owned by Knight Ridder, a San Jose, Calif.-based media conglomerate.

Because both The Times and The Hearst Corp., owner of the P-I, are privately owned, they are not required to make their finances public.

Hearst declined to comment.

The Times and the P-I are locked in a legal battle over whether the $10 million in losses claimed by The Times under the JOA from 2000 to 2002 allow it to force negotiations to either shut down the P-I or end the JOA.

The JOA permits either paper — after three consecutive years of losses — to demand that one be shut down within 18 months or the JOA be terminated.

Hearst is challenging the validity of the Times' 2000 and 2001 losses in a case currently before the state Court of Appeals. It won a lower-court decision in September that The Times could not use those losses toward shutting down the P-I. The Times appealed.

Under the JOA, the papers maintain separate newsrooms, but The Times prints, circulates and markets both papers. They pool their advertising and circulation revenue and, after The Times is paid for handling the non-news functions, they split the pool. Sixty percent goes to The Times and 40 percent to Hearst. A Times loss in 2003 does not directly affect the status of Hearst's legal case, although The Times could later cite it if it loses the court appeal.

For its part, Hearst has said it intends to also challenge The Times' 2002 loss claim if the appeal goes against the New York-based media company.

Times officials have cited the P-I's dwindling circulation and Seattle's slow economic recovery for much of the paper's difficulties.

In an internal memo to Times staffers last month, Michael Lemke, Times senior vice president for sales, said that after a slight rebound, the paper's retail and auto advertising dropped "dramatically" near the end of last year. Classified ads were down 7.3 percent in 2003 from the previous year, Lemke said.

In December, The Seattle Times Co. completed a $9.6 million sale of 34 acres of land it owned in Renton. The company also has put about 5 acres it owns near its corporate headquarters up for sale.

Bill Richards is a free-lance writer hired on a special contract by The Seattle Times to cover events involving the joint operating agreement with the Seattle Post-Intelligencer. He can be reached at brichards@seattletimes.com