If you’ve ever wondered why high-quality niche publications like Politics in Minnesota, Finance & Commerce and Minnesota Lawyer put up a pay wall, look no further than the 2011 financials that owner Dolan Co. released Friday morning.
The Minneapolis-based Dolan posted a staggering 27.6 percent drop in 2011 public-notice revenues, according to a 10-K filing. That loss amounted to $12.7 million in a business-information division with $78 million in revenue overall.
Although the local titles are only a sliver of the 64 print and 82 websites Dolan controls, public notices are integral to many, including F&C and PiM’s Capitol Report component.
Dolan blamed a “default slowdown” in the foreclosure market. Negotiations between government, mortgage servicers and banks have delayed the human misery that spurs tons of public notices and legal services. However, the company predicts a recent settlement could open stuck floodgates, and provided 2012 financial projections somewhere between 2010’s and 2011’s results.
Chairman James P. Dolan noted that the rate of ad decline had slowed in 2011; like many traditional publishers, he counts on readers paying more. “We are seeing some signs of near-term improvement in this segment and we are working hard to migrate towards a subscription-based business model.”
The former Dolan Media was once a publishing-based company, but now derives more revenue from professional services, mostly to the legal industry. There, too, the foreclosure slowdown has hurt; overall, company revenues fell 5.6 percent compared to 2010, while the Business Information division (which includes the local titles) shrunk 6.2 percent. Business Information shrunk 2.3 percent in 2010.
In the hopes of propping up Business Information profits, Dolan said, “we have made good progress in terms of reorganizing and centralizing some parts of the division to reduce costs and improve margins, and we are seeing some benefit.”
In April 2011, Dolan hired former Pioneer Press business editor Doug Iverson as senior editor after casting off editors of Finance & Commerce and Minnesota Lawyer in late 2010.