The drip, drip, drip of dismal news for Media General continues. The Richmond-based owner of newspapers and local TV stations, has reported a loss from continuing operations of $1.4 million during the 2Q of 2008. That’s down from a $5.1 million profit the same period last year.

And those results don’t include a “non-cash impairment charge,” relating to good will and other intangible assets, which is expected to be in the range of $500 million to $550 million after tax.

The problem, very simply put, is that revenues are collapsing. Newspaper advertising revenues declined 17.1 percent. The erosion was worst in the company’s Florida operations, but severe in Virginia as well – down 12.5 percent -- reflecting the performance of the Richmond Times-Dispatch and smaller papers in Charlottesville, Lynchburg, Danville, Bristol and other cities. Newspaper profits are a third of what they were a year ago. 

Broadcast profits are down, and even the Interactive Media Division reported a loss last quarter after a brief period of profitability.

Regarding the impairment charge, CEO Marshall M. Morton said in a prepared statement, "We determined that, in view of the continued economic slowdown and the market's perception of media industry equity valuations, this was the appopriate time to undertake the impairment testing. The charge is non-cash and will not impact our ability to operate, reduce debt or move forward with our ongoing transition to the digital world."

Media General continues to cut costs aggressively in response to the advertising recession. If there’s a silver lining to the quarterly report, it’s that newspaper and broadcast operations remain profitable as stand-along entities before the repayment of substantial corporate debt.