LOS ANGELES, Aug. 12, 2022 (GLOBE NEWSWIRE) -- During the nine months ended June 30, 2022, Daily Journal Corporation (NASDAQ:DJCO) had consolidated revenues of $34,797,000 as compared with $37,952,000 in the prior year period. This decrease of $3,155,000 was primarily from decreases in (i) Journal Technologies' license and maintenance fees of $3,269,000 and public service fees of $21,000, and (ii) the Traditional Business' circulation revenues of $179,000, partially offset by increases in Journal Technologies' consulting fees of $48,000 and the Traditional Business' advertising net revenues of $30,000 and advertising service fees and other of $236,000.

The Traditional Business' pretax income increased by $1,372,000 to $1,442,000 from $70,000 in the prior fiscal year period, primarily resulting from a reduction to the long-term supplemental compensation accrual of $25,000 as compared with an increase of $1,410,000 in the prior fiscal year period. Journal Technologies' business segment pretax loss increased by $5,360,000 to $3,116,000 from pretax income of $2,244,000 in the prior fiscal year period, primarily due to decreased revenues as a result of the Company's decision to end the maintenance of its legacy software products as of July 1, 2021 in order to focus on supporting Journal Technologies' main "eSeries" products. During the nine months ended June 30, 2022, the Company sold part of its marketable securities for approximately $80,570,000, realizing net gains on the sales of those marketable securities of $14,249,000 (as compared with $18,478,000 of realized net gains in the prior year period), and borrowed an additional net $43,000,000 from the margin loan account to primarily purchase additional marketable securities with a total cost of approximately $117,678,000. In addition, there were increases in net unrealized losses on marketable securities of $188,829,000 to $57,075,000 from net unrealized gains of $131,754,000 in the prior fiscal year period. The Company's investments generated approximately $4,251,000 in dividends income for the nine months ended June 30, 2022, as compared with $2,063,000 in the prior fiscal year period. During the nine months ended June 30, 2022, consolidated pretax loss was $40,532,000, as compared to pretax income of $154,434,000 in the prior fiscal year period. The net (loss) income per common share is based on the weighted average number of shares outstanding during the comparable financial periods. The shares used in the calculation were 1,380,542 and 1,380,746 for the nine months ended June 30, 2022 and 2021 respectively. There was consolidated net loss of $30,797,000 (-$22.31 per share) for the nine months ended June 30, 2022, as compared with consolidated net income of $114,319,000 ($82.80 per share) in the prior fiscal year period.

The Company believes that the Coronavirus pandemic has had, and, with the Delta and Omicron variant cases, and most recently the more contagious BA.4 and BA.5 sub-variant cases, will continue to have, a significant impact on the Company's business operations. It is possible that governments may again take actions in response to the pandemic, such as the renewed closure, or scaling back of operations, of courts and other governmental agencies that are the customers of the Company. This might also include a fair degree of volatility in the value of the Company's marketable securities. At June 30, 2022, the Company held marketable securities valued at $341,855,000, including net pretax unrealized gains of $187,018,000, and accrued a deferred tax liability of $50,540,000 for estimated income taxes due only upon the sales of the net appreciated securities.

For the nine months ended June 30, 2022, the Company recorded an income tax benefit of $9,735,000 on the pretax loss of $40,532,000. The income tax benefit consisted of a tax benefit of $15,425,000 on the unrealized losses on marketable securities and a benefit of $250,000 for the dividends received deduction and other permanent book and tax differences, offset by tax provisions of $3,850,000 on the realized gains on marketable securities, $500,000 on income from operations, and $1,590,000 for the effect of a change in state apportionment on the beginning of the year's deferred tax liability. Consequently, the overall effective tax rate for the nine months ended June 30, 2022 was 24%, after including the taxes on the realized gains and unrealized losses on marketable securities.

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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.

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Contact: Tu To                                                                  (213) 229-5436