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The Washington Post Company’s third-quarter 2012 earnings from continuing operations came in at $6.79 per share, up approximately 31% from $5.18 earned in the prior-year quarter reflecting strength across Television Broadcasting and Cable Television divisions, offset by sluggish performance in the Education and Newspaper Publishing divisions.

Including one-time items and discontinued operations, the company posted quarterly earnings of $12.64 compared with a loss of 82 cents a share in the year-ago quarter.

Revenue for the quarter came in at $1,011.3 million compared with $1,012.5 million in the prior-year quarter.

Education division’s revenue went down 8% to $552.6 million, reflecting a 17% fall in Higher Education revenue partially mitigated by a 2% increase in Test Preparation revenue and a 3% rise in Kaplan International revenue. The Education division saw operating income of $14.7 million compared with $20.8 million in the prior-year quarter.

Total student enrollment fell 8% year-over-year but jumped sequentially by an equivalent percentage to 73,261. The company hinted that new student enrollment rose 9% during the quarter at Kaplan University and Kaplan Higher Education Campuses.

Television Broadcasting revenue surged 44% to $106.4 million during the quarter, whereas operating income rose more than twofold to $54.1 million, attributable to healthy advertising demand. Moreover, political advertising also contributed $15.6 million to the revenue.

Cable Television division’s revenue rose 6% to $199.6 million. The division benefited from revenue growth registered across Internet and telephone service revenues, but was offset by higher promotional discounts and fall in basic video subscribers’ base. The division’s operating income jumped 8% to $39.9 million attributable to higher revenue partially offset by increased programming expenses.

Basic video subscribers fell 3.6% to 605,057. On the other hand, high-speed data subscribers rose 3.3% to 462,808 and telephony subscribers grew 5.2% to 185,647.

Newspaper Publishing revenue came in at $137.3 million, down 4% from the year-ago quarter. Print advertising revenue at The Washington Post tumbled 11% to $51.4 million, reflecting a fall in general and retail advertising. Revenue from newspaper online publishing activities, principally washingtonpost.com and Slate, jumped 13% to $26.9 million, whereas display online advertising revenue climbed 18%. Online classified advertising revenue inched up 1%.

During first-nine months of 2012, Post daily and Sunday circulation fell 9.2% and 6.5%, respectively, from the year-ago period.

The Newspaper division’s operating loss widened to $21.8 million from a loss of $10.8 million witnessed in the prior-year quarter.

Currently we maintain our long-term Underperform recommendation on the stock. However, The Washington Post Company, which faces stiff competition from The New York Times Company (NYT - Analyst Report), holds a Zacks #3 Rank that translates into a short-term Hold rating.

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