Daily Journal Corporation Announces Financial Results for the Six Months ended March 31, 2016
May 10, 2016 at 15:11 PM EDT
LOS ANGELES, May 10, 2016 (GLOBE NEWSWIRE) -- During the six months ended March 31, 2016, Daily Journal Corporation (NASDAQ:DJCO) had consolidated pretax income of $17,000 compared to $237,000 in the prior year period. This decrease in profit of $220,000 resulted primarily from (i) decreases in the Traditional Business’s trustee sale notice and related service fee revenues and commercial advertising revenues and (ii) Journal Technologies’ additional personnel costs and travel expenses, primarily for installation services.
Consolidated revenues were $22,257,000 and $22,715,000 for the six months ended March 31, 2016 and 2015, respectively. This decrease of $458,000 was primarily from the continuing decline in the Traditional Business’s trustee sale notice and related service fee revenues of $352,000 and a decline in commercial advertising revenues of $418,000 primarily due to the discontinuance of publishing the California Lawyer magazine. It also reflects a decline in Journal Technologies’ public service fees of $558,000, partially offset by increased Journal Technologies’ license and maintenance fees of $317,000 and consulting fees of $430,000. Consolidated operating costs and expenses decreased by $247,000 to $23,795,000 from $24,042,000 primarily resulting from reduced expenses for the Traditional Business, partially offset by additional expenses for Journal Technologies described above.
The Company’s Traditional Business segment’s pretax income decreased by $261,000 to $135,000 from $396,000, primarily resulting from the decreases in trustee sale notice and related service fee revenues and commercial advertising revenues, partially offset by decreased legal, accounting and other professional service fees. Journal Technologies’ business segment pretax loss decreased by $30,000 to $1,737,000 from $1,767,000 and included the amortization costs of intangible assets of $2,447,000 and $2,448,000 for the six-month periods ended March 31, 2016 and 2015, respectively. This decrease in loss primarily resulted from increases in licensing and maintenance fees and consulting fees, partially offset by the decrease in public service fees and the increase in personnel costs and additional travel expenses for installation services. The Company’s Corporate income, net of expenses, increased by $11,000 to $1,619,000, primarily because of additional dividends and interest income from the Company’s marketable securities.
The Company recorded an income tax benefit of $240,000 on pretax income of $17,000 for the six months ended March 31, 2016. The income tax benefit was the result of applying the effective tax rate anticipated for fiscal 2016 to pretax income for the six-month period ended March 31, 2016. The effective tax rate was lower than the statutory rate primarily due to the dividends received deduction and the domestic production activity deduction. On pretax income of $237,000 for the six months ended March 31, 2015, the Company recorded an income tax benefit of $700,000 which was the net result of applying the effective tax rate anticipated for fiscal 2015 to pretax income for the six months ended March 31, 2015.
At March 31, 2016, the Company held marketable securities valued at $162,531,000, including net unrealized gains of $104,149,000, and accrued a liability of $40,060,000 for income taxes due only upon the sales of the net appreciated securities.
Comprehensive loss includes net income and net decrease in unrealized net gains on marketable securities, net of taxes, as summarized below:
Daily Journal Corporation publishes newspapers and web sites covering California and Arizona, and produces several specialized information services. Journal Technologies, Inc. is a wholly-owned subsidiary and supplies case management software systems and related products to courts and other justice agencies.
This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain statements contained in this press release are “forward-looking” statements that involve risks and uncertainties that may cause actual future events or results to differ materially from those described in the forward-looking statements. Words such as “expects,” “intends,” “anticipates,” “should,” “believes,” “will,” “plans,” “estimates,” “may,” variations of such words and similar expressions are intended to identify such forward-looking statements. We disclaim any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments, or otherwise. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to have been correct. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in documents we file with the Securities and Exchange Commission.
Contact: Tu To (213) 229-5436