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To: fut_trade who wrote (19759)	2/7/1999 5:03:00 PM
From: Glenn D. Rudolph	Respond to of 27307

February 5, 1999 Ziff Says Profit Dropped in Period; Revenue Rose 80% at ZDNet Unit An INTERACTIVE JOURNAL News Roundup Ziff-Davis Inc. posted a sharp drop in net income due to a slowdown in its core publishing business and a big restructuring charge. The New York-based company also announced an investment from the venture firm controlled by billionaire Paul G. Allen and said revenue at its ZDNet online unit jumped sharply. Ziff-Davis Stock Soars 31% as Investors Jump In After ZDNet IPO Is Announced (Dec. 28, 1998) Publisher Ziff-Davis Takes a Hit; Company Set to Cut Work Force (Oct. 9, 1998) Ziff's net income came to $8.4 million, or eight cents a share, down from $72.6 million, or 73 cents a share, in the year-ago period. Excluding a restructuring charge of $31.3 million, or 32 cents a share, the company had a fourth-quarter profit of $39.7 million, or 40 cents a share. This was well below analysts' consensus estimate of 51 cents a share, as complied by First Call. Revenue fell 6.3% to $378.3 million from $403.6 million in the year-ago period. Ziff said the decline in revenue was due to lower advertising in certain business publications, the absence of revenue from discontinued publications Internet Business, Equip and Windows Pro and the shift of Seybold Seminars San Francisco from the fourth quarter in 1997 to the third quarter in 1998. Partially offsetting these declines was an 80% growth in Internet revenue and a strong revenue increase in consumer publications, Ziff said. The company had warned Wall Street in October that it would take a big restructuring charge in the fourth quarter to close three magazines and lay off 10% of its work force. Few publishing sectors have grown faster than computer and technology trade magazines. But recently, the temperature has been falling at Ziff publications. Ziff, along with many other computer-related publishers and businesses, has been hurt by delays of widely anticipated new products from Microsoft Corp. and Intel Corp., as well as by rapidly falling personal-computer prices. A bright spot in Friday's earnings reports was online unit ZDNet, which Ziff plans to spin off as a tracking stock. Fourth-quarter revenue at ZDNet increased 80% to $19.7 million from $10.9 million a year ago. ZDNet's revenue was up 36% sequentially over third-quarter revenue of $14.5 million. Ziff's earnings before interest, taxes, depreciation and amortization in the fourth quarter, before the restructuring charge, was $138.1 million compared with $158.7 million last year. Separately, Ziff said Vulcan Ventures Inc., controlled by Mr. Allen, agreed to buy three million common shares of Ziff for $50 million. Also, Vulcan closed its $54 million investment in ZDTV, a 24-hour cable TV channel. Ziff said it has invited William Savoy, president of Vulcan Ventures, to be a director.