Time Inc's quarterly profit beats Street as costs fall

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Magazine publisher Time Inc. reported a quarterly profit that handily beat market expectations on Tuesday as lower costs more than made up for weak print ad sales.

The company, whose titles include People, Sports Illustrated and Time magazine, said editorial and production costs fell 10 percent in the second quarter, helped partly by a strong dollar.

Restructuring and severance costs dropped 78 percent, while selling, general and administrative costs fell 5.7 percent.

The magazine industry holds on

Like many other traditional publishers, Time Inc.—which was spun off from Time Warner in June 2014—has been struggling to grow as readers shift to online media.

Advertising revenue fell 8.9 percent to $420 million, while circulation revenue, which includes sales of magazines through subscriptions and newsstand sales, fell 1.6 percent to $254 million.

However, the company recorded a net profit of $24 million, or 22 cents per share, compared with a net loss $32 million, or 30 cents per share, in the same period last year.

Excluding items, Time earned 27 cents per share. Total revenue fell 5.7 percent to $773 million.

Analysts on average had expected a profit of 15 cents per share and revenue of $758 million, according to Thomson Reuters I/B/E/S.