E.W. Scripps said today it expects to announce its plans for the future of the Rocky Mountain News, which lost $16 million in 2008, before the end of the first quarter March 31.

The Cincinnati-based company made the statement as it released its fourth-quarter earnings. Scripps said Dec. 4, 2008, that it was putting the Rocky up for sale. It accepted bids through the close of business Jan. 16.

“Some of the very best journalism in the nation has not been enough to rescue a franchise trapped in an unsustainable business model,” Scripps CEO Rich Boehne told Wall Street analysts in a conference call. “We’re proud of the Rocky’s journalistic accomplishments, but we simply cannot absorb unending — and growing — losses, hence our decision to exit that great market.”

Boehne declined to answer an analyst’s question about what the cost of shutting the Rocky might be. “We’re probably not far enough along to give you an exact number of what it would cost to shut down or exit the market,” Boehne said. “One of the reasons for that is it’s not clear to us, as we sit here today, which way we might go and what our method of exit might be.”

Scripps said newsroom expenses for the Rocky for full-year 2008 were about $16 million higher than its share of profits from the Denver Newspaper Agency, excluding a one-time gain from the sale of real estate in the first quarter.

For the fourth quarter, Scripps reported $8.44 million in Denver costs and no income from the agency. Because the agency is a limited liability partnership and Scripps has written the value of its investment in the agency down to zero, Scripps is no longer recording losses from the agency on its income statement, spokesman Tim King said.

King said the Denver costs include newsroom expenses plus a $2.8 million reserve for newsprint “that we shipped to the (agency) in November but have not yet been paid for.”

The company’s overall results showed the steep decline in the traditional media businesses in which it operates.

Scripps’ revenue, which includes its newspaper division and broadcast television stations, decreased 6.2 percent to $265 million, compared with $282 million in the fourth quarter of 2007.

Scripps said it was unable to report a net income figure because it’s still trying to determine its income tax numbers from the spinoff of Scripps Networks Interactive, its cable and Internet business that became a separate company in July. The company hopes to have that number by the time it files its annual report with the Securities and Exchange Commission in March.

The company reported a fourth-quarter loss from continuing operations before income taxes and minority interests of $19.4 million, compared with positive income before income taxes and minority interests of $44.7 million in the fourth quarter of 2007.

Revenue from newspapers managed solely by Scripps — a number that excludes newspapers like the Rocky, which are part of partnerships — fell 16.5 percent in the fourth quarter to $137.5 million. Advertising revenue was down 19.8 percent to $104.8 million. Classified advertising was down 31.2 percent to $27.7 million.

Segment profit at newspapers managed solely by the company was $12.9 million, compared with $37.3 million in the fourth quarter of 2007.

“It became apparent toward the end of the year there’s nowhere to hide from the national economic crisis,” Boehne said. “Despite our geographic diversity and multiple sources of advertising revenue, we’re feeling the pain as the recession rolls its way through our local markets and media businesses. There’s an old saying, misery loves company, but there’s certainly no joy to be found in this shared experience.”

The company said it would write down the value of its investment in the Prairie Mountain Publishing newspaper partnership, which includes the Boulder Daily Camera, by $10.9 million.

Scripps on Wednesday told employees it would institute pay cuts of 3 percent to 5 percent for most employees at newspapers and the corporate office. The cuts are in addition to salary cuts of between 5 percent and 15 percent that affected corporate executives, TV station general managers and newspaper publishers effective Jan. 1, Scripps said.

The company also will suspend its match of contributions to most employees’ 401(k) retirement savings plans and drastically reduce bonuses across the company for 2009. Other changes were implemented as well, differing by location, division and, where applicable, collective bargaining agreements.

Scripps said it expects that these measures will reduce the company’s expenses in 2009 by about $20 million.

Employees also were told that the company will freeze its pension plan later this year.

SCRIPPS CEO RICH BOEHNE’S UPDATE ON THE ROCKY

From today’s earnings call:

Let me update you on one situation where, unfortunately, we have decided there may not be an attractive future for Scripps.

Ten weeks ago we put up for sale one of the best newspapers in the country, the Rocky Mountain News in Denver. Some of the very best journalism in the nation has not been enough to rescue a franchise trapped in an unsustainable business model. Because of the head-to-head newspaper war, the Rocky and The Denver Post subsidized the economic vitality of Colorado for decades with ridiculously low advertising and circulation rates. The joint operating agreement provided a lifeline for the Rocky and the Post for many years, but the market spoke recently and loudly and clearly that this arrangement could not last as is, at least not economically. We’re proud of the Rocky’s journalistic accomplishments, but we simply cannot absorb unending — and growing — losses, hence our decision to exit that great market. We haven’t given many updates about our progress on the sale because having so many parties involved makes the process complex, but I believe you’ll hear news from us on this before the end of the first quarter, for sure, and not too far out.

Alexia Quadrani, JPMorgan Chase analyst: Could you let us know what costs you think might be involved in closing the Rocky Mountain News if a sale wasn’t achieved?

Rich Boehne: On Denver we’re probably not far enough along to give you an exact number of what it would cost to shut down or exit the market. One of the reasons for that is it’s not clear to us, as we sit here today, which way we might go and what our method of exit might be. So it’s probably just a little bit premature, but I can tell you it’s not a number that would materially change our plans at this point.

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