In line with statements made at the end of the 2003 fiscal year, Reader's Digest Association Inc., Pleasantville, NY, said yesterday that it lost $13 million for its 2004 first quarter.
When reporting its year-end earnings for fiscal 2003, Reader's Digest predicted that fiscal year 2004 would be down to flat with the company returning to profitability in fiscal 2005.
The first-quarter loss compares with the $2 million profit it posted for the same period in 2003. Total revenue for the company declined 4 percent to $495 million.
Reader's Digest attributed the decrease mainly to its International Business, which was down $13 million to $216 million due to reduced marketing activity and a tough business climate in many overseas markets. The Reader's Digest North America division was down $8 million to $200 million. The firm's Consumer Business Services revenue fell $1 million to $85 million.
“Overall, operating results for the first quarter were in line with management expectations,” Reader's Digest chairman/CEO Thomas O. Ryder said in a statement. “We remain committed to our plan to return to year-over-year revenue and operating profit growth by fiscal 2005. Cash flow trends continue to be favorable, and we made significant progress in our cost-reduction programs and in stabilizing our international markets.”