From The Associated Press
 

Tribune Co., owner of The Morning Call in Allentown, reported a 24 percent drop in third-quarter profits due largely to higher costs.

Tribune, whose holdings include 13 daily newspapers, more than two dozen television stations and the Chicago Cubs, earned $176.2 million after a $6.1 million payment of preferred dividends. That compared to $230.5 million after $6.4 million in dividend payments in the same period a year ago.

Net earnings were 53 cents a share versus 71 cents a share a year earlier.

Operating expenses rose 6 percent because of a lower pension credit, higher newsprint expenses, the impact of two TV station acquisitions and higher expenses for the Cubs.

Excluding non-operating gains, earnings were 48 cents a share, or 2 cents below the consensus estimate of analysts polled by Thomson First Call.

Revenues rose 3 percent to $1.39 billion from $1.34 billion.

"Despite a challenging advertising environment in the third quarter, Tribune achieved solid revenue growth in both our newspaper and television businesses," said President and CEO Dennis FitzSimons.

Revenue from the publishing division, which includes the Chicago Tribune, Los Angeles Times, Newsday of Melville, N.Y., and Tribune's other newspapers, increased by 2 percent to $966 million, including a 2% increase in retail advertising revenue.

Broadcasting and entertainment division revenues climbed 7 percent, including an 11 percent jump for radio attributable largely to the rising popularity of Cubs broadcasts. The team was a rare contender for the National League pennant this year and the Central Division champions.

But Tribune also said higher player compensation for the Cubs contributed to operating expenses for the same division soaring 16 percent over a year earlier.

For the first nine months, net income was $534.5 million after $18.5 million in preferred dividend payouts, up from $230.7 million after $18.8 million in dividends. Revenues were $4.13 billion, up from $3.95 billion.

Tribune shares fell 49 cents to $47.92 in morning trading on the New York Stock Exchange.