Daily Journal Corporation Announces Financial Results for the Three Months ended December 31, 2019
February 07 2020 - 1:29PM
During the three months ended December 31, 2019, Daily Journal
Corporation (NASDAQ:DJCO) had consolidated revenues of
$11,677,000,000 as compared with $10,428,000 in the prior year
period. This increase of $1,249,000 was primarily from (i)
Journal Technologies’ increased license and maintenance fees of
$420,000, consulting fees of $148,000 and public service fees of
$748,000, and (ii) the Traditional Business’ increases of
government notice advertising net revenues of $40,000 and legal
notice advertising net revenues of $61,000, partially offset by
reductions in the Traditional Business’ classified advertising net
revenues of $16,000, trustee sale notice advertising net revenues
of $37,000 and circulation revenues of $26,000.
The Traditional
Business had pretax income of $112,000, representing a $144,000
increase from a pretax loss of $32,000 in the prior year
period. Journal Technologies’ pretax loss decreased by
$860,000 to $1,652,000 from $2,512,000.
At December 31,
2019, the Company held marketable securities valued at
$214,112,000, including net unrealized gains of $160,223,000, and
accrued a deferred tax liability of $42,611,000 for estimated
income taxes due only upon the sales of the net appreciated
securities. The net unrealized gains in these marketable
securities increased by $19,531,000 in the three months ended
December 31, 2019, and these investments generated approximately
$1,680,000 in dividends income during such period.
For the three
months ended December 31, 2019, the Company recorded a provision
for income taxes of $5,280,000 on pretax income of
$19,490,000. This was the net result of applying the
19% effective tax rate anticipated for fiscal 2020 to the pretax
loss, before the unrealized gains on investments, for the three
months ended December 31, 2019. The effective tax rate was
less than the statutory rate primarily due to the dividends
received deduction and state tax benefits. In addition,
the Company recorded taxes on its unrealized gains on investments
of $19,531,000 during the three months ended December 31,
2019. The effective tax rate for the three months ended
December 31, 2019 was 27%, after including the taxes on the
unrealized gains on investments.
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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
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