Quick Look at RHD, VZN Numbers

Both R.H. Donnelley and Verizon posted their second-quarter and year-to-date figures today, and each revealed some challenges. We will write up both sets of results in detail for next week’s Local Media Journal. In the meantime, here are some quick highlights.

R.H. Donnelley
RHD CEO Dave Swanson called it a "mixed" quarter. A big challenge was soft results in Dex markets, which RHD execs were at pains to describe as "short term" and largely related to high error rates from a messy system installation at Dex that was under way when RHD acquired the company last year. The clear suggestion was that Dex’s customer service practices were not yet up to RHD’s standards but were rapidly being improved. The short-term consequence was a higher rate of cancellations and a loss of productivity.

The company is forecasting negative advertising sales for the full year but is sticking with its pledge to grow at 2 percent to 4 percent annually over the long term.

Another interesting note was that RHD had to put the brakes on WebClicks sales because they were too far ahead of RHD’s or its vendor’s ability to fulfill the orders. This points to a disconnect between demand and inventory.

For the first half, RHD had net directory advertising revenues of US$1.43 billion, down about 1.7 percent over the same period last year.

Verizon Information Services
VIS posted first-half revenues of US$1.64 billion, down 6.4 percent over the same period last year. The company attributed the decline to reductions in domestic print advertising revenues.

What is interesting is that the company says its SuperPages.com’s revenues were up 12.2 percent in the first half. This suggests revenue growth for the IYP is declining, despite a 143.9 percent second-quarter increase in online Yellow Pages searches on the site.

With growth tapering off at SuperPages.com, restoring top-line growth at Verizon seems more challenging.