**UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**





**FORM
      10-Q**





(Mark
      One)





**x**
            **Quarterly
                Report Pursuant to Section 13 or 15 (d) of the Securities
                Exchange Act of 1934**





**For
      the quarterly period ended September 30, 2007**





**or**





** ̈**
            **Transition
                Report Pursuant to Section 13 or 15 (d) of the Securities
                Exchange Act of 1934**





**For
      the transition period
      from
      to**





**Commission
      File Number: 333-112246**





**Morris
      Publishing Group, LLC**


**Morris
      Publishing Finance Co.***


**(Exact
      name of Registrants as specified in their charters)**








**Georgia**
            
            **58-1445060****Georgia**
            
            **20-0183044****(State
                of organization)**
            
            **(I.R.S.
                Employer Identification Numbers)****725
                Broad Street Augusta, Georgia**
            
            **30901****(Address
                of principal executive offices)**
            
            **(Zip
                Code)**





**(706)
      724-0851**


**(Registrants’
      Telephone number)**





Indicate
      by check mark whether the Registrants (1) have filed all reports required
      to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
      1934 during the preceding 12 months (or for such shorter period that the
      Registrant was required to file such reports), and (2) have been subject to
      such filing requirements for the past 90 days.





**Yes   ̈                                     No  x**





Indicate
      by check mark whether the Registrants are large accelerated filers, accelerated
      filers, or non-accelerated filers. See definition of “accelerated filer and
      large accelerated filer” in Rule 12b-2 of the Exchange Act. Check
      one:





**Large
                Accelerated Filer**  
            
            **Accelerated
                Filer**  
            
            **Non-Accelerated
                Filer**  **x**





Indicate
      by check mark whether the Registrant Morris Publishing Group, LLC is a shell
      company (as defined in Rule 12b-2 of the Exchange Act).





**Yes   ̈                                    No  x**





Indicate
      by check mark whether the Registrant Morris Publishing Finance Co. is a shell
      company (as defined in Rule 12b-2 of the Exchange Act).





**Yes  x                                    No   ̈**





*
            Morris
                Publishing Finance Co. meets the conditions set forth in General
                Instruction H (1) (a) and (b) of Form 10-Q and is therefore
                filing this form with the reduced disclosure
                format.










**MORRIS
      PUBLISHING GROUP, LLC**


**MORRIS
      PUBLISHING FINANCE CO.**


**QUARTERLY
      REPORT**


**FOR
      THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2007**




**TABLE
      OF CONTENTS**




**Page****FORWARD
                  LOOKING STATEMENTS**
              
              3**PART
                  I.**Item
                  1.      Financial
                  Statements:Unaudited
                  condensed consolidated balance sheets as of September
                  30, 2007 and December 31, 2006
              
              4Unaudited
                  condensed consolidated statements of income for the
                  three and nine month periods ended September 30, 2007 and
                  2006
              
              5Unaudited
                  condensed consolidated statements of cash flows for
                  the nine month periods ended September 30, 2007 and
                  2006
              
              6Notes
                  to condensed consolidated financial
                  statements
              
              7Item
                2.      Management's Discussion
                and Analysis of Financial Condition and Results of OperationItem
                  3.      Quantitative and
                  Qualitative Disclosures about Market Risk
              
              30Item
                  4.      Controls and
                  Procedures
              
              30**PART
                  II.**Item
                  1.      Legal
                  Proceedings.
              
              33Item
                  1A.   Risk Factors
              
              33Item
                  2.      Unregistered
                  Sales of Equity Securities and Use of Proceeds.
              
              33Item
                  3.      Defaults Upon
                  Senior Securities.
              
              33Item
                  4.     Submission of
                  Matters to a Vote of Security Holders.
              
              33Item
                  5.      Other
                  Information
              
              33Item
                  6.      Exhibits
              
              33
  Morris
      Publishing Group, LLC is a wholly owned subsidiary of Morris Communications
      Company, LLC, a privately held media company. Morris Publishing Finance Co.,
      a
      wholly owned subsidiary of Morris Publishing Group, LLC, was incorporated in
      2003 for the sole purpose of serving as a co-issuer of our senior subordinated
      notes in order to facilitate the offering. Morris Publishing Finance Co. does
      not have any operations or assets of any kind and will not have any revenues.
      In
      this report, “Morris Publishing,” “we,” “us” and “our” refer to Morris
      Publishing Group, LLC and its subsidiaries. “Morris Communications” refers to
      Morris Communications Company, LLC.




*Table
          of Contents*






**FORWARD
      LOOKING STATEMENTS**





This
        report contains forward-looking statements. These statements relate to future
        periods and include statements regarding our anticipated performance. You
        may
        find discussions containing such forward-looking statements in “Management’s
        Discussion and Analysis of Financial Condition and Results of Operations” in
        Item 2 of this report.
 
 Generally,
        the words “anticipates,” “believes,” “expects,” “intends,” “estimates,”
“projects,” “plans” and similar expressions identify forward-looking statements.
        These forward-looking statements involve known and unknown risks, uncertainties
        and other important factors that could cause our actual results, performance
        or
        achievements or industry results, to differ materially from any future results,
        performance or achievements expressed or implied by these forward-looking
        statements.
 
 Although
        we believe that these statements are based upon reasonable assumptions, we
        can
        give no assurance that these statements will be realized. Given these
        uncertainties, prospective investors are cautioned not to place undue reliance
        on these forward-looking statements. These forward-looking statements are
        made
        as of the date of this report. We assume no obligation to update or revise
        them
        or provide reasons why actual results may differ. Important factors that
        could
        cause our actual results to differ materially from our expectations include,
        without limitation:
 
 increases
                    in financing, labor, health care and/or other costs, including
                    costs of
                    raw materials, such as
                    newsprint;
 general
                        economic or business conditions, either nationally, regionally
                        or in the
                        individual markets in which we conduct business (and, in
                        particular, the
                        Jacksonville, Florida market), may deteriorate and have an
                        adverse impact
                        on our advertising or circulation revenues or on our business
                        strategy;
 other
                    risks and uncertainties.


-3-
 *Table
          of Contents*





**PART
      I**




**Item
        1.                      Financial
        Statements**


**Morris
                Publishing Group, LLC****Unaudited
                condensed consolidated balance
                sheets****September
                30,**
            
            
            **December
                31,**(Dollars
                in thousands)
            
            **2007**
            
            
            **2006****ASSETS**CURRENT
                ASSETS:Cash
                and cash equivalents
            
            $
            5,597
            
            
            $
            6,964Accounts
                receivable, net of allowance for doubtful accounts of $2,570 and
                $2,625 at
                September 30, 2007 and December 31, 2006 , respectively
            
            
            51,425
            
            
            
            58,236Inventories
            
            
            5,220
            
            
            
            4,030Deferred
                income taxes, net
            
            
            2,009
            
            
            
            2,248Prepaid
                and other current assets
            
            
            1,340
            
            
            
            1,065Total
                current assets
            
            
            65,591
            
            
            
            72,543NET
                PROPERTY AND EQUIPMENT
            
            
            142,227
            
            
            
            144,117OTHER
                ASSETS:Goodwill
            
            
            188,394
            
            
            
            188,394Intangible
                assets, net of accumulated amortization of $5,568 and $63,070 at
                September
                30, 2007 and December 31, 2006, respectively
            
            
            9,637
            
            
            
            12,267Deferred
                loan costs and other assets, net of accumulated amortization of loan
                costs
                of $5,875 and $4,669 at September 30, 2007and December 31, 2006, respectively
            
            
            10,649
            
            
            
            11,522Total
                other assets
            
            
            208,680
            
            
            
            212,183Total
                assets
            
            $
            416,498
            
            
            $
            428,843**LIABILITIES
                AND MEMBER'S DEFICIENCY IN ASSETS**CURRENT
                LIABILITIES:Accounts
                payable
            
            $
            10,126
            
            
            $
            10,399Current
                maturities of long-term debt
            
            
            8,750
            
            
            
            2,188Accrued
                interest
            
            
            4,304
            
            
            
            9,427Due
                to Morris Communications
            
            
            983
            
            
            
            1,326Deferred
                revenues
            
            
            18,113
            
            
            
            16,649Accrued
                employee costs
            
            
            9,893
            
            
            
            12,916Other
                accrued liabilities
            
            
            2,952
            
            
            
            1,556Total
                current liabilities
            
            
            55,121
            
            
            
            54,461LONG-TERM
                DEBT, less current portion
            
            
            517,250
            
            
            
            521,813DEFERRED
                INCOME TAXES, less current portion
            
            
            16,503
            
            
            
            18,406POSTRETIREMENT
                BENEFITS DUE TO MORRIS COMMUNICATIONS
            
            
            26,857
            
            
            
            25,948OTHER
                LONG-TERM LIABILITIES
            
            
            3,948
            
            
            
            3,750Total
                liabilities
            
            
            619,679
            
            
            
            624,378COMMITMENTS
                AND CONTINGENCIES (NOTE 7)MEMBER'S
                DEFICIENCY IN ASSETSMember's
                deficit
            
            
            (201,685
            )
            
            
            (172,382
            )Loan
                receivable from Morris Communications, net
            
            
            (1,496
            )
            
            
            (23,153
            )Total
                member's deficiency in assets
            
            
            (203,181
            )
            
            
            (195,535
            )Total
                liabilities and member's deficiency in assets
            
            $
            416,498
            
            
            $
            428,843*See
                notes to consolidated financial statements.*




-4-
 *Table
          of Contents*







**Morris
                Publishing Group, LLC****Unaudited
                condensed consolidated statements of income****Three
                months ended September 30,**
            
            
            **Nine
                months ended September 30,**(Dollars
                in thousands)
            
            **2007**
            
            
            **2006**
            
            
            **2007**
            
            
            **2006**NET
                OPERATING REVENUES:Advertising
            
            $
            88,510
            
            
            $
            96,415
            
            
            $
            267,273
            
            
            $
            287,776Circulation
            
            
            17,140
            
            
            
            17,310
            
            
            
            50,941
            
            
            
            52,113Other
            
            
            3,884
            
            
            
            3,723
            
            
            
            11,947
            
            
            
            11,750Total
                net operating revenue
            
            
            109,534
            
            
            
            117,448
            
            
            
            330,161
            
            
            
            351,639Labor
                and employee benefits
            
            
            43,619
            
            
            
            43,894
            
            
            
            133,813
            
            
            
            131,326Newsprint,
                ink and supplements
            
            
            10,912
            
            
            
            14,813
            
            
            
            35,753
            
            
            
            44,502Other
                operating costs (excluding depreciation and amortization)
            
            
            33,358
            
            
            
            32,894
            
            
            
            100,283
            
            
            
            96,921Depreciation
                and amortization expense
            
            
            4,161
            
            
            
            5,459
            
            
            
            14,443
            
            
            
            15,933Total
                operating expenses
            
            
            92,050
            
            
            
            97,060
            
            
            
            284,292
            
            
            
            288,682Operating
                income
            
            
            17,484
            
            
            
            20,388
            
            
            
            45,869
            
            
            
            62,957Interest
                expense, including amortization of debt issuance costs
            
            
            9,614
            
            
            
            9,389
            
            
            
            28,370
            
            
            
            27,560Interest
                income
            
            
            (1
            )
            
            
            (1
            )
            
            
            (5
            )
            
            
            (69
            )Other,
                net
            
            
            (78
            )
            
            
            (62
            )
            
            
            (170
            )
            
            
            (119
            )Total
                other expenses, net
            
            
            9,535
            
            
            
            9,326
            
            
            
            28,195
            
            
            
            27,372INCOME
                BEFORE INCOME TAXES
            
            
            7,949
            
            
            
            11,062
            
            
            
            17,674
            
            
            
            35,585PROVISION
                FOR INCOME TAXES
            
            
            2,988
            
            
            
            4,154
            
            
            
            6,978
            
            
            
            13,619NET
                INCOME
            
            $
            4,961
            
            
            $
            6,908
            
            
            $
            10,696
            
            
            $
            21,966*See
                notes to condensed consolidated financial statements.*
            
            ****
            
            
            
            ****
            
            
            
            ****
            
            
            
            ****




-5-
 *Table
          of Contents*





**Morris
                Publishing Group, LLC****Unaudited
                condensed consolidated statements of cash flows****(Dollars
                in thousands)**
            
            **2007**
            
            
            **2006**OPERATING
                ACTIVITIES:Net
                income
            
            $
            10,696
            
            
            $
            21,966Adjustments
                to reconcile net income to cash provided by operating
                activities:Depreciation
                and amortization
            
            
            14,443
            
            
            
            15,933Deferred
                income taxes
            
            
            (1,664
            )
            
            
            (2,469
            )Amortization
                of debt issuance costs
            
            
            1,207
            
            
            
            1,208Loss
                (gain) on sale and disposal of fixed assets, net
            
            
            16
            
            
            
            (41
            )Changes
                in assets and liabilities, net of effects of businesses
                acquired:Accounts
                receivable
            
            
            6,811
            
            
            
            2,304Inventories
            
            
            (1,190
            )
            
            
            371Prepaids
                and other current assets
            
            
            (275
            )
            
            
            16Other
                assets
            
            
            (158
            )
            
            
            (181
            )Accounts
                payable
            
            
            (274
            )
            
            
            (700
            )Accrued
                employee costs
            
            
            (3,024
            )
            
            
            (2,764
            )Accrued
                interest
            
            
            (5,123
            )
            
            
            (5,243
            )Due
                to Morris Communications
            
            
            (343
            )
            
            
            887Deferred
                revenues and other liabilities
            
            
            2,855
            
            
            
            1,680Postretirement
                obligations due to Morris Communications
            
            
            909
            
            
            
            1,268Other
                long-term liabilities
            
            
            198
            
            
            
            87Net
                cash provided by operating activities
            
            
            25,084
            
            
            
            34,322INVESTING
                ACTIVITIES:Capital
                expenditures
            
            
            (10,071
            )
            
            
            (5,510
            )Restricted
                cash released from escrow
            
            
            -
            
            
            
            6,780Net
                proceeds from sale of property and equipment
            
            
            136
            
            
            
            133Acquisitions
                of businesses, net of cash acquired
            
            
            -
            
            
            
            (5,155
            )Net
                cash used in investing activities
            
            
            (9,935
            )
            
            
            (3,752
            )FINANCING
                ACTIVITIES:Proceeds
                from revolving credit facility
            
            
            50,000
            
            
            
            43,000Repayments
                on revolving credit facility
            
            
            (48,000
            )
            
            
            (38,000
            )Debt
                issuance costs
            
            
            (175
            )
            
            
            -Advances
                on loan receivable from Morris Communications
            
            
            (18,341
            )
            
            
            (42,211
            )Net
                cash used in financing activities
            
            
            (16,516
            )
            
            
            (37,211
            )NET DECREASE
                IN CASH AND CASH EQUIVALENTS
            
            
            (1,367
            )
            
            
            (6,641
            )CASH
                AND CASH EQUIVALENTS, beginning of period
            
            
            6,964
            
            
            
            12,458CASH
                AND CASH EQUIVALENTS, end of period
            
            $
            5,597
            
            
            $
            5,817SUPPLEMENTAL
                DISCLOSURES OF CASH FLOW INFORMATIONInterest
                paid
            
            $
            32,287
            
            
            $
            31,594Income
                taxes paid to Morris Communications
            
            
            8,611
            
            
            
            16,088Accrued
                capital expenditures
            
            
            -
            
            
            
            -Dividends
                applied against loan receivable from Morris Communications
            
            
            40,000
            
            
            
            43,000*See
                notes to consolidated financial statements.*




-6-
 *Table
          of Contents*






**MORRIS
      PUBLISHING GROUP, LLC**


**Notes
      to condensed consolidated financial statements (unaudited)**


**(Dollars
      in thousands)**








**1.**
            **Basis
                of Presentation and Change in Significant Accounting
                Policies**





***Basis
      of presentation***– The accompanying condensed consolidated financial
      statements furnished herein reflect all adjustments, which in the opinion of
      management, are necessary for the fair presentation of the Company’s financial
      position and results of operations. All such adjustments are of a normal
      recurring nature. Results of operations for the three and nine month interim
      periods in 2007 are not necessarily indicative of results expected for the
      full
      year. While certain information and footnote disclosures normally included
      in
      financial statements prepared in accordance with accounting principles generally
      accepted in the United States of America (“GAAP”) have been condensed or
      omitted, the Company believes that the disclosures herein are adequate to keep
      the information presented from being misleading. These condensed consolidated
      financial statements should be read in conjunction with the audited consolidated
      financial statements and the notes thereto for the year ended December 31,
      2006.
      The accounting policies that are employed are the same as those shown in Note
      1
      to the consolidated financial statements as of December 31, 2006 and 2005 and
      for each of three years ended December 31, 2006.





**2.**
            **Transactions
                with Morris Communications**





***Management
      fee***– The Company was charged
      with a management fee by Morris Communications in an amount equal to the greater
      of 4% of the total net operating revenue or the actual management costs
      applicable to the Company based upon usage, as defined in the management
      agreement. These management fees totaled $4,374 and $4,698 for the three months
      ended September 30, 2007 and 2006, respectively, and $13,205 and $14,066 for
      the
      nine months ended September 30, 2007 and 2006, respectively. This expense
      compensates Morris Communications for corporate services and costs incurred
      on
      behalf of the Company, including executive, legal, secretarial, tax, internal
      audit, risk management, employee benefit administration, airplane usage and
      other support services. The Company has recorded this management fee within
      other operating costs in the accompanying financial statements.





***Technology
      and shared services fee****–* The Company was charged
      with a technology and shared services fee from Morris Communications, as defined
      in the management agreement. This fee is based upon the lesser of 2.5% of total
      net operating revenue of the Company or the actual technology costs applicable
      to the Company based upon usage. The technology and shared services fees paid
      to
      Morris Communications, which was based upon 2.5% of the total net operating
      revenue of the Company, totaled $2,735 and $2,937 for the three months ended
      September 30, 2007 and 2006, respectively, and $8,254 and $8,791 for the nine
      months ended September 30, 2007 and 2006, respectively. The Company has recorded
      this management fee within other operating costs in the accompanying financial
      statements.





***Employees’
      401(k) plan***– The Company participates in Morris Communications’
401(k) plan. Under this plan, contributions by employees to the
      401(k) plan are
      matched (up to 5% of pay) by Morris Communications. Expenses were allocated
      to
      the Company based on specific identification of employer matching contributions
      of $1,015 and $1,043 for the three months ended September, 2007 and 2006,
      respectively, and $3,163 and $3,203 for the nine months ended September, 2007
      and 2006, respectively.





***Retiree
      health care benefits***– The Company participates in Morris
      Communications’ retiree health care plan, which provides certain health care
      benefits for eligible retired employees and their dependents. The plan requires
      the Company to be separately liable for its portion of the postretirement health
      benefit obligation. Accordingly, the Company and Morris Communications have
      completed a formal actuarial valuation of the postretirement obligation for
      the
      Company as of and for the year ended December 31, 2006.





Under
      Morris Communications’ plan, full-time employees who were hired before January
      1, 1992 and retire after ten years of service are eligible for these benefits.
      Full-time employees hired on or after January 1, 1992 must have 25 years of
      service to be eligible. Generally, this plan pays a percentage of most medical
      expenses (reduced for any deductible) after payments made by government programs
      and other group coverage. This plan is unfunded.




-7-
 *Table
          of Contents*






Lifetime
      benefits under the plan are limited to $100 per employee. Expenses related
      to
      this plan have been allocated to the Company based on total headcount. The
      expenses allocated to the Company, and the related contributions recorded were
      $303 and $423 for the three months ended September 30, 2007 and 2006,
      respectively, and $909 and $1,268 for the nine months ended September 30, 2007
      and 2006, respectively.





The
      Company was also allocated its portion of the postretirement health benefit
      obligation. The amounts allocated to the Company, based on total headcount
      were
      $26,857 and $25,948 as of September 30, 2007 and December 31, 2006,
      respectively.





The
      following is an estimate of the Company’s net periodic benefit cost for
      2007:





**2007**Service
                cost
            
            $
            514Interest
                cost
            
            
            1,409Unrecognized
                gain from earlier periods
            
            
            -Net
                periodic benefit cost
            
            
            1,923Less:
                employee contributions
            
            
            (711
            )Estimated
                net benefit expense
            
            $
            1,212





***Health
      and Disability Plan***– The Company has participated in Morris
      Communications’ health and disability plan for active employees. Accordingly,
      Morris Communications has allocated to the Company certain expenses associated
      with the payment of current obligations and the estimated amounts incurred
      but
      not yet reported. The expense allocated to the Company based on the total
      headcount, was $2,841 and $2,314 for the three months ended September 30, 2007
      and 2006, respectively, and $10,489 and $8,346 for the nine months ended
      September 30, 2007 and 2006, respectively.





The
      Company was also allocated its portion of the health and disability obligation.
      The amounts allocated to the Company, based on total headcount, were $2,404
      and
      $2,076 as of September 30, 2007 and December 31, 2006, respectively. The Company
      has recorded this liability within accrued employee costs in the accompanying
      financial statements.





***Workers’
      Compensation Expense***– The Company has participated in Morris
      Communications’ workers’ compensation self-insurance plan. Accordingly, Morris
      Communications has allocated to the Company certain expenses associated with
      the
      payment of current obligations and the estimated amounts incurred but not yet
      reported. The expenses allocated to the Company, based on a percentage of total
      salaries expense, were $719 and $761 for the three months ended September 30,
      2007 and 2006, respectively, and $2,320 and $2,300 for the nine months ended
      September 30, 2007 and 2006, respectively.





***Loan
      receivable from Morris Communications***– Under the Company’s
      indenture related to the senior subordinated notes, the Company is permitted
      to
      loan up to $40 million at any one time to Morris Communications or any of its
      wholly owned subsidiaries outside the Publishing Group, solely for purposes
      of
      funding its working capital, capital expenditures and acquisition requirements.
      The Company is also permitted to invest in or lend an additional $20 million
      at
      any one time outstanding to Morris Communications or any other Person(s), as
      defined in the debt indenture.





The
      interest-bearing portion of all loans from the Company to Morris Communications
      bear the same rate as the borrowings under the Credit Agreement (for the three
      month period ended September 30, 2007, this rate was LIBOR (adjusted to the
      nearest 1/16th) + 1.00%). The Company distinguishes between intercompany
      transactions incurred in the ordinary course of business and settled on a
      monthly basis (which do not bear interest) and those of a more long-term nature
      that are subject to an interest accrual. Interest is accrued on the average
      outstanding long-term balance each month.





Given
      the
      historical practice of Morris Publishing and Morris Communications settling
      a
      significant portion of the outstanding loan receivable balance with a dividend,
      this arrangement is considered in substance a capital distribution transaction
      and is classified as contra-equity within member’s deficit. In addition,
      interest accrued on this
      loan
      receivable is reported as contra-equity within member’s deficiency in assets for
      the periods presented.




-8-
 *Table
          of Contents*






The
      Company has classified the outstanding $1,496 and $23,153 loan receivable
      balances, net of the $5,004 and $3,579 in accumulated interest accrued on these
      receivables, as of September 30, 2007 and December 31, 2006, respectively,
      as
      part of member’s deficiency in assets.





During
      the three month periods ended September 30, 2007 and 2006, the Company reported
      the $166 and $638, respectively, in accrued loan receivable interest as
      contra-equity. The average interest rate for the three month periods ended
      September 30, 2007 and 2006 was 6.6042% and 6.3958%, respectively, on average
      loan receivable balances of $7,831 and $39,078, respectively.





During
      the nine month periods ended September 30, 2007 and 2006, the Company reported
      the $1,425 and $1,649, respectively, in accrued loan receivable interest as
      contra-equity. The average interest rate for the nine month periods ended
      September 30, 2007 and 2006 was 6.3819% and 6.0069%, respectively, on average
      loan receivable balances of $28,512 and $36,109, respectively.





***Restricted
      payments***– The Company is permitted under its debt arrangement to
      make restricted payments, which includes dividends and loans to affiliates
      in
      excess of the permitted limits described above, up to the sum of (1) 100% of
      the
      Company’s cumulative consolidated income before interest, taxes, depreciation
      and amortization (“Consolidated EBITDA”, as defined in the indenture) earned
      subsequent to the debt’s August 2003 issue date less (2) 140% of the
      consolidated interest expense of the Company for such period.





On
      June
      30, 2007, September 30, 2006 and March 31, 2006 the Company declared and
      recorded dividends of $40 million, $28 million and $15 million, respectively,
      to
      Morris Communications, in effect, reducing the loan receivable from Morris
      Communications by the dividend amounts. At September 30, 2007, the Company
      had
      approximately $78.8 million available for future restricted payments under
      the
      credit indenture.





***Restricted
      cash******released from******escrow***–
Cash
      held in escrow was
      comprised of proceeds from the 2005 sale of the Company’s former Savannah
      newspaper facility which the Company elected to be deposited into an escrow
      account in order to potentially fund other acquisitions by the Company or Parent
      through a tax-deferred Section 1031 exchange. The Parent acquired $5,280 in
      qualified replacement property during the first quarter of 2006 with the
      reductions in the restricted escrow account being offset by an increase in
      loan
      receivable from Morris Communications. The remaining $1,500 in escrow became
      unrestricted to the Company on the March 27, 2006 expiration date for the
      tax-deferred exchange.





**3.**
            **Recently
                Issued Accounting
                Standards**





The
      Company will be required to adopt the Financial Accounting Standards Board’s
      (“FASB”)  Statement of Financial Accounting Standards (“SFAS”) No.
      157,*“Fair Value Measurements”*  (“SFAS 157”) for
      the fiscal year beginning January 1, 2008. SFAS 157 provides a single definition
      of fair value and a hierarchical framework for measuring it, as well as
      establishing additional disclosure requirements about the use of fair value
      to
      measure assets and liabilities. The Company is in the process of evaluating
      the
      impact of SFAS 157 on its results of operations and financial
      position.





In
      February 2007, the FASB issued SFAS No. 159, *“The Fair Value Option for
      Financial Assets and Liabilities”* (“SFAS 159”). SFAS 159 provides the
      option to report certain financial assets and liabilities at fair value, with
      the intent to mitigate volatility in financial reporting that can occur when
      related assets and liabilities are recorded on different bases and is effective
      for fiscal years beginning after November 15, 2007. The Company is in the
      process of evaluating the impact of SFAS 159, if elected, on its results of
      operations and financial position.





In
      September 2006, the FASB issued SFAS No. 158, *“Employers’ Accounting for
      Defined Benefit Pension and Other Postretirement Plans”*(“SFAS No. 158”),
      an amendment of FASB Statements No. 87, 88, 106 and 132(R). SFAS No. 158
      requires the recognition of the funded status of a retiree health plan in the
      statement of financial position, requires that changes in the funded status
      be
      recognized through comprehensive income, changes the measurement date for
      defined benefit plan assets and obligations to the entity’s fiscal year-end and
      expands disclosures. The recognition and disclosures under SFAS No. 158 are
      required as of the end of the fiscal year ending




-9-
 *Table
          of Contents*






after
      June 15, 2007, while the new measurement date is effective for fiscal years
      ending after December 15, 2008.  SFAS No. 158 requires that previously
      disclosed but unrecognized gains/losses, prior service costs, and transition
      obligations of a retiree health plan be recognized at adoption of SFAS No.
      158
      as a component of shareholder’s equity in accumulated other comprehensive
      income, net of applicable income taxes.





The
      measurement date for the Company’s retiree health plan obligations is currently
      the Company’s fiscal year-end so a change in measurement date is not needed. Had
      SFAS No. 158 been adopted at December 31, 2006, the Company’s accumulated other
      comprehensive income would have decreased by $1,016, in effect, increasing
      the
      member's deficit by $1,016.




In
        July
        2006, the FASB issued Interpretation No. 48, *“Accounting for Uncertainty in
        Income Taxes”* (“FIN No. 48”), effective for fiscal years beginning after
        December 15, 2006. Under FIN No. 48, companies are required to make explicit
        disclosures about uncertainties in their income tax positions, including
        a
        detailed roll forward of tax benefits taken that do not qualify for financial
        statement recognition. Under FIN No. 48, the recognition of a tax benefit
        would
        only occur when it is “more-likely-than-not” that the position would be
        sustained in a dispute with the taxing authority in the “court of last resort.”
The adoption of FIN No. 48 had no impact on the Company.


**4.**
              **Acquisitions**


In
        July
        2006, the Company acquired certain assets and assumed certain liabilities
        of
        four weekly newspapers in Georgia and South Carolina from Community Newspapers,
        Inc. The newspapers acquired were *The Barnwell* (S.C.)
*People-Sentinel*, *The Hampton County* (S.C.) *Guardian*,
*The Edgefield* (S.C.) *Citizen News* and the *Sylvania*
        (Ga.) *Telephone*, all of which will enhance the Company’s presence in
        the Augusta market area. The acquisition was accounted for as a purchase
        and had
        an aggregate purchase price, including closing costs, of approximately $4,405.
        The Company paid cash for the acquisition.
  The
        Company allocated $2,045 of the purchase price to the estimated fair values
        of
        assets and liabilities acquired. The $2,360 in excess purchase price over
        the
        fair value of the tangible and intangible net assets was allocated to
        goodwill.
  The
        results of operations have been recorded in the consolidated statements of
        income from the date of acquisition. The pro forma effect on net income had
        the
        acquisition been reflected as of the beginning of the year acquired and the
        previously reported year would not have been material.


**5.**
            **Long-Term
                Debt**




At
        September 30, 2007 and December 31, 2006, total debt was $526 million and
        $524
        million, respectively, with $51 million and $49 million outstanding on the
        $175
        million revolving credit facility, respectively.
  At
        September 30, 2007, the interest rate on the Tranche A term loan outstanding
        was
        7.0% and the weighted average interest rate on the revolver was 6.863%. The
        average interest rate on the debt outstanding was approximately 7.040% and
        6.679% at September 30, 2007 and December 31, 2006, respectively. The commitment
        fee on the unborrowed funds available under the revolver was 0.375% at September
        30, 2007 and December 31, 2006.
  On
        July
        3, 2007, the Company, as borrower, entered into an Amendment No. 1 under
        the
        Credit Agreement dated as of December 14, 2005 (the “Credit Agreement”). The
        Credit Agreement contains financial covenants requiring the Company to meet
        certain financial tests on an on-going basis, including minimum interest
        coverage ratio, minimum fixed charge coverage ratio, and maximum cash flow
        ratios, based upon consolidated financial results of Morris Communications
        and
        substantially all of its subsidiaries (including the Company). The amendment
        relaxes these financial tests for an 18 month period from and including June
        30,
        2007 through but excluding December 31, 2008. The
        $175
        in debt issuance costs associated with this amendment was deferred and is
        being
        amortized over the life of the term loan.





Without
      either an improvement in the Morris Communications consolidated financial
      results in 2008 or a reduction of the Company’s indebtedness, the Company is at
      risk of failing to meet one or more of the financial covenants




-10-
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as
      of
      December 31, 2008, in which event the Company would be unable to borrow on
      the
      revolver and may be required to prepay the entire principal due under the Credit
      Agreement.  The Company intends to carefully monitor the
      consolidated financial results and to take any necessary steps to avoid default,
      which steps may include (i) further amendments or refinancing of the Credit
      Agreement, which could increase the Company’s cost of capital, or (ii) the sale
      or transfer of a portion of the assets within the Morris Communications
      consolidated group to third parties or to affiliates with the sales proceeds
      being used to reduce the Company’s indebtedness.





At
      September 30, 2007, the Company could borrow and use for general corporate
      purposes approximately $55 million under the Company’s most restrictive
      covenants which were from the senior bank credit facility and the Company was
      in
      compliance with all covenants under its debt arrangements.





**6.**
            **Goodwill
                and Other Intangible
                Assets**





Goodwill
      is the excess of cost over fair market value of tangible net assets acquired.
      Goodwill is not presently amortized but tested for impairment annually or when
      the facts or circumstances at any of the Company’s reporting units indicate a
      possible impairment of goodwill as a result of a continual decline in
      performance or as a result of fundamental changes in a market in accordance
      with
      SFAS No. 142, “Goodwill and Other Intangible Assets”.





Other
      intangible assets acquired consist primarily of mastheads and licenses on
      various acquired properties, customer lists, as well as other assets. Other
      intangible assets acquired (mastheads and domain names) which have indefinite
      lives and are not currently amortized, are tested for impairment annually or
      when facts or circumstances indicate a possible impairment of the intangible
      assets as a result of a continual decline in performance or as a result of
      fundamental changes in a market.





Certain
      other intangible assets acquired (subscriber lists, non-compete agreements
      and
      other assets) are amortized over their estimated useful lives (from 5 to 20
      years).





During
      December 2006, the Company performed the required impairment tests of goodwill
      and the indefinite-lived intangible assets, which resulted in no
      impairments.





Amortization
      expense of other intangible assets for the three and nine month periods ended
      September 30, 2007 was $263 and $2,715, respectively.





Changes
      in the carrying amounts of goodwill and other intangible assets of the Company
      for the nine months ended September 30, 2007 were as follows


**Other****intangible****Goodwill**
              
              
              **assets**Balance
                  at December 31, 2006
              
              $
              188,394
              
              
              $
              12,267Additions
              
              
              -
              
              
              
              85Amortization
                  expense
              
              
              -
              
              
              
              (2,715
              )Balance
                  at September 30, 2007
              
              $
              188,394
              
              
              $
              9,637


-11-
 *Table
          of Contents*






Other
      finite-lived and indefinite-lived intangible assets at September 30, 2007 and
      December 31, 2006 were as follows:





**Accumulated**
            
            
            **Net****Cost**
            
            
            **amortization**
            
            
            **cost****September
                30, 2007:****Finite-lived
                intangible assets**Subscriber
                lists*
            
            $
            10,372
            
            
            $
            5,532
            
            
            $
            4,840Non-compete
                agreements and other assets
            
            
            51
            
            
            
            36
            
            
            
            15Total
                finite-lived intangible assets
            
            
            10,423
            
            
            
            5,568
            
            
            
            4,855**Indefinite-lived
                intangible assets**Newspaper
                mastheads
            
            
            4,656
            
            
            
            
            
            
            
            4,656Domain
                names
            
            
            126
            
            
            
            
            
            
            
            126Total
                Indefinite-lived intangible assets
            
            
            4,782
            
            
            
            
            
            
            
            4,782Total
                other intangible assets
            
            $
            15,205
            
            
            $
            5,568
            
            
            $
            9,637**
                Eliminated $60,207in fully amortized assets during the quarter ended
                June
                30, 2007***December
                31, 2006:****Finite-lived
                intangible assets**Subscriber
                lists
            
            $
            70,579
            
            
            $
            63,033
            
            
            $
            7,546Non-compete
                agreements and other assets
            
            
            61
            
            
            
            37
            
            
            
            24Total
                finite-lived intangible assets
            
            
            70,640
            
            
            
            63,070
            
            
            
            7,570**Indefinite-lived
                intangible assets**Newspaper
                mastheads
            
            
            4,656
            
            
            
            
            
            
            
            4,656Domain
                names
            
            
            41
            
            
            
            
            
            
            
            41Total
                Indefinite-lived intangible assets
            
            
            4,697
            
            
            
            
            
            
            
            4,697Total
                other intangible assets
            
            $
            75,337
            
            
            $
            63,070
            
            
            $
            12,267





The
      remaining expense for the last three months of 2007 and for the four succeeding
      years for the existing finite-lived intangible assets is as
      follows:





2007
            
            $
            1922008
            
            
            7682009
            
            
            7492010
            
            
            7322011
            
            
            602





**7.**
            **Commitments
                and Contingencies**





The
      Company and its subsidiaries are parties to several claims and lawsuits arising
      in the course of their normal business activities. Although the ultimate outcome
      of these suits cannot be ascertained at this time, it is the opinion of
      management that these matters, when resolved, will not have a material effect
      on
      the Company’s condensed consolidated financial statements.





**8.**
            **Subsequent
                Events**





On
      October 23, 2007, the Company signed a definitive
      asset purchase agreement(the “Agreement”) to sell fourteen daily
      newspapers, three nondaily newspapers, a commercial printing operation and
      other
      related publications to GateHouse Media, Inc. (“GateHouse”) for a purchase price
      of $115 million, subject to a working capital adjustment. GateHouse may elect
      to
      pay up to $10 million in the form of a one year promissory note bearing interest
      at 8% per annum, with the remainder in cash. The transaction is expected to
      close before the end of November and is subject to the Company's lender approval
      and customary closing conditions.





The
      parties to the agreement are the Company, MPG Allegan Property, LLC, Broadcaster
      Press, LLC, MPG Holland Property, LLC, The Oak Ridger, LLC, and Yankton Printing
      Company, as sellers, and Morris Communications Company, LLC, as seller
      guarantor, and GateHouse Media Operating, Inc., as buyer, and GateHouse, as
      buyer guarantor. Other than the Agreement, there are no material relationships
      between the Company and GateHouse or any of their respective
      affiliates.




-12-
 *Table
          of Contents*






The
      daily
      newspapers to be sold include the *Dodge City* (Kan.) *Daily
      Globe*, *The Newton* (Kan.) *Kansan*, *The* (Pittsburg,
      Kan.) *Morning Sun*, the *Hillsdale* (Mich.) *Daily News*,
*The**Holland* (Mich.) *Sentinel*, the *Hanniba*l
      (Mo.) *Courier-Post,* *The*(Independence, Mo.)
*Examiner*, *The**Grand Island* (Neb.)
*Independent*, the *York*(Neb.)
*News-Times*,
*The
      Daily Ardmoreite* (Okla.), *The**Shawnee* (Okla.)
*News-Star*, the *Yankton*(S.D.) *Daily Press &
Dakotan*, *The Oak Ridger* (Tenn.),
      and the *News Chief*
      (Winter Haven, Fla.). The nondaily newspapers include *La Estrella*
      (Dodge City, Kan.) *The Girard* (Kan.) *City Press* and the
*Vermillion* (S.D.) *Plain Talk*. The commercial printing
      operation is Flashes Publishing (Mich.), which also publishes *The Holland
      Sentinel* and the *Flashes Shopping Guides*(Mich.), related free
      nondaily community publications included in the sale.





The
      sale
      of these publications and businesses will allow the Company, as part of its
      strategic plan, to focus on its larger markets and will enable the Company
      to
      pay down its existing bank debt. The Company will utilize all of its after-tax
      net cash proceeds to repay an estimated $73 million of its Tranche A Term Loan
      under its senior credit facilities, following the closing of the transaction,
      and another $7 million upon receipt of payment on the $10 million note from
      GateHouse. The Company does not expect the transaction to result in a
      significant change in its cash flow ratio under its senior credit facilities
      or
      its consolidated leverage ratio under its indenture related to the senior
      subordinated notes.





Total
      net
      operating revenue for the publications and businesses to be sold to GateHouse
      was $71.3 million for the twelve month period ended December 31, 2006 and $17.5
      million and $51.0 million for the three and nine month periods ended September
      30, 2007, respectively.





Total
      operating costs directly associated with these publications and businesses
      were
      $59.9 million for the twelve month period ended December 31, 2006 and $14.9
      million and $44.3 million for the three and nine month periods ended September
      30, 2007, respectively. These total direct operating costs do not include the
      management fee and the technology and shared services fee charged by Morris
      Communications or any allocation of the Company’s other corporate overhead
      costs.





The
      Company has not yet determined to what extent, if any, the management
      fee, the technology
      and shared services feeand its corporate overhead costs will change as a
      result of the transaction. (See Note 2, *Transactions with
      Morris Communications**,*regarding the management fee and the
      technology and shared services fee.)





In
      accordance with SFAS No. 144, “*Accounting for the Impairment or Disposal of
      Long-Lived Assets*”, in the fourth quarter of 2007 the consolidated
      statements of income of the Company for current and prior periods will report
      the results of operations of the components being disposed of in discontinued
      operations.


-13-
 *Table
          of Contents*
 
 **ITEM
        2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS**
 
 The
        following discussion should be read in conjunction with our unaudited condensed
        consolidated financial statements as of and for the three and nine month
        periods
        ended September 30, 2007 and 2006 and with our consolidated financial statements
        for the year ended December 31, 2006 filed on Form 10-K.
 
 **Overview**
 
 Morris
        Publishing currently owns and operates 27 daily newspapers as well as nondaily
        newspapers, city magazines and free community publications in the Southeast,
        Midwest, Southwest and Alaska.
 
 While
        most of our revenue is generated from advertising and circulation from our
        newspaper operations, we also print and distribute periodical publications
        and
        operate commercial printing operations in conjunction with our newspapers.
        In
        addition, our newspaper operations generate revenues from both print and
        online
        media formats.
 
 Linage,
        rate and mix of advertisement are the primary components of advertising revenue.
        The advertising rate depends largely on our market reach, primarily through
        circulation, online page views and market penetration. The number of copies
        sold
        and the amount charged to our customers are the primary components of
        circulation revenue. Our other revenue consists primarily of commercial printing
        and other online revenue.
 
 During
        the first nine months of 2007, advertising and circulation revenue represented
        81.0% and 15.4%, respectively, of our total net operating revenue. Our
        advertising revenue consisted of 51.7% in retail, 5.7% in national and 42.6%
        in
        classified. Online advertising revenue, included in all advertising categories
        above, represented 10.8% of our total nine month 2007 advertising revenue,
        up
        from 8.2% from last year.
 
 Employee
        and newsprint costs are the primary costs at each newspaper. Our operating
        performance is affected by newsprint prices, which historically have fluctuated.
        Newsprint costs have represented 10 - 15% of total operating expenses.
        Historically, newsprint has been subject to significant price fluctuations
        from
        year to year, unrelated in many cases to general economic trends. Supply
        and
        demand has typically controlled pricing. We believe that current and future
        sources of newsprint will be sufficient to meet our current and anticipated
        requirements.
 
 We
        continue to see overall declines in circulation at our newspapers which is
        consistent with the industry as a whole. We continue to focus on circulation
        retention efforts through lengthened subscriptions periods, new payment methods,
        and increased service levels.
 
 In
        addition, we view our industry’s currently changing landscape as a great
        opportunity, with many of our current strategic initiatives embracing these
        changes to continue to move us forward. While we continue to focus on our
        core
        business, we are aggressively pursuing innovation as the key to move our
        newspapers into a portfolio-model business with a wide variety of products
        focusing on meeting the changing needs of our core newspaper consumers and
        customers in all of our markets and helping us to remain the informational
        leaders in the communities we serve.
 
 **Critical
        accounting policies and estimates**
 
 Critical
        accounting policies are those that are most significant to the portrayal
        of our
        financial position and results of operations and require difficult, subjective
        and complex judgments by management in order to make estimates about the
        effect
        of matters that are inherently uncertain. The preparation of these financial
        statements requires us to make estimates and judgments that affect the reported
        amounts in our condensed consolidated financial statements. We evaluate our
        estimates on an on-going basis, including those related to our allowances
        for
        bad debts, asset impairments, post-retirement benefits, self-insurance and
        casualty, management fees, income taxes and commitments and contingencies.
        We
        base our estimates on historical experience and on various other assumptions
        that we believe to be reasonable under the circumstances, the results of
        which
        form the basis for making judgments about the carrying values of assets and
        liabilities.
 
 -14-
 *Table
            of Contents*
 
 
 Although
        actual results have historically been reasonably consistent with management’s
        expectations, the actual results may differ from these estimates or our
        estimates may be affected by different assumptions or conditions.
 
 We
        believe there have been no significant changes during the quarter ended
        September 30, 2007 to the items that we disclosed as our critical accounting
        policies and estimates herein and in the Management’s Discussion and Analysis of
        Financial Condition and Results of Operations in our annual report dated
        December 31, 2006 filed with the Securities and Exchange Commission on Form
        10-K.
 
 **Information
        availability**
 
 Our
        quarterly reports on Form 10-Q, annual reports on Form 10-K, current reports
        on
        Form 8-K and all amendments to those reports are available free of charge
        on our
        Web site, morris.com , as soon as feasible after such reports are
        electronically filed with or furnished to the Securities and Exchange
        Commission. In addition, information regarding corporate governance at Morris
        Publishing and our parent, Morris Communications Company, LLC (“Morris
        Communications”), is also available on our Web site. The information on our Web
        site is not incorporated by reference into, or as part of, this Report on
        Form
        10-Q.
 
 **Subsequent
        Events**
 
 On
        October 23, 2007, we entered into a definitive asset
        purchase agreement (the “Agreement”) to sell fourteen daily and three
        nondaily newspapers, a commercial printing operation and other related
        publications to GateHouse Media, Inc. (“GateHouse”) for a purchase price of $115
        million, subject to a working capital adjustment. GateHouse may elect to
        pay up
        to $10 million in the form of a one year promissory note bearing interest
        at 8%
        per annum, with the remainder in cash. The
        transaction is expected to close before the end of November and is subject
        to
        our lender’s approval and customary closing conditions.
  The sale of these publications and businesses will allow
        us,
        as part of our strategic plan, to focus on our larger markets.
 In
        addition, we will utilize all of the after-tax net cash proceeds to repay
        an
        estimated $73 million of our Tranche A Term Loan under our senior credit
        facilities, following the closing of the transaction, and another $7 million
        upon receipt of payment on the $10 million note from GateHouse. We do not
        expect
        the transaction to result in a significant change in our cash flow ratio
        under
        our senior credit facilities or our consolidated leverage ratio under our
        indenture related to the senior subordinated notes.
 
 Our
        daily
        newspapers to be sold include the *Dodge City* (Kan.) *Daily
        Globe*, *The Newton* (Kan.) *Kansan*, *The* (Pittsburg,
        Kan.) *Morning Sun*, the *Hillsdale* (Mich.) *Daily News*,
*The**Holland* (Mich.) *Sentinel*, the *Hanniba*l
        (Mo.) *Courier-Post,* *The*(Independence, Mo.)
*Examiner*, *The**Grand Island* (Neb.)
*Independent*, the *York*(Neb.)
*News-Times*,
*The
        Daily Ardmoreite* (Okla.), *The**Shawnee* (Okla.)
*News-Star*, the *Yankton*(S.D.) *Daily Press &
Dakotan*, *The Oak Ridger* (Tenn.),
        and the *News Chief*
        (Winter Haven, Fla.). Our nondaily newspapers include *La Estrella*
        (Dodge City, Kan.) *The Girard* (Kan.) *City Press* and the
*Vermillion* (S.D.) *Plain Talk*. Our commercial printing
        operation is Flashes Publishing (Mich.), which also publishes *The Holland
        Sentinel* and the *Flashes Shopping Guides*(Mich.), related free
        nondaily community publications included in the sale.
 
 Total
        net
        operating revenue for the publications and businesses to be sold to GateHouse
        was $71.3 million for the twelve month period ended December 31, 2006 and
        $17.5
        million and $51.0 million for the three and nine month periods ended September
        30, 2007, respectively.
 
 Total
        operating costs directly associated with these publications and businesses
        were
        $59.9 million for the twelve month period ended December 31, 2006 and $14.9
        million and $44.3 million for the three and nine month periods ended September
        30, 2007, respectively. These total direct operating costs do not include
        the
        management fee and the technology and shared services fee charged by Morris
        Communications or any allocation of our other corporate overhead
        costs.
 
 At
        September 30, 2007, these publications and businesses to be sold represented
        approximately 22% and 11% of our average daily and Sunday circulation,
        respectively, and approximately 21% of our total FTE’s (or full time
        equivalents)
 
 -15-
 *Table
            of Contents*
   We
        are
        charged with a management fee by our parent, Morris Communications, in an
        amount
        equal to the greater of 4% of our total net operating revenue or its actual
        management costs applicable to us based upon usage, as defined in our management
        agreement. Our parent also charges us with a technology
        and shared services fee, which is based upon the lesser of 2.5% of our total
        net operating revenue or its actual technology costs applicable to us based
        upon
        usage. We have not yet determined to what extent, if any, the management
        fee,
        the technology and shared services fee and our corporate overhead costs will
        change as a result of the transaction.
 
 **Financial
        summary for the three months ended September 30, 2007 compared to September
        30,
        2006**
 
 Compared
        to last year, operating income was $17.5 million, down $2.9 million, or 14.1%,
        with total operating revenue of $109.5 million, down $7.9 million, or 6.7%,
        and
        total operating costs of $92.1 million, down $5.0 million, or 5.2%.
 
 During
        the third quarter of 2007, advertising and circulation revenue represented
        80.8%
        and 15.7%, respectively, of our total net operating revenue. Our advertising
        revenue consisted of 51.8% in retail, 5.3% in national and 42.9% in
        classified.
 
 Advertising
        revenue for the quarter was $88.5 million, a decrease of $7.9 million, or
        8.2%,
        from last year, with retail, classified and national advertising revenue
        down
        3.9%, 11.8% and 17.1%, respectively. The third quarter of 2007 included one
        more
        Sunday compared with a year ago, slightly benefiting this years
        quarter-over-quarter comparisons, as Sundays usually generate more print
        advertising revenue than the other six days of the week.
 
 Since
        the
        end of the second quarter last year, we have acquired or introduced ten nondaily
        publications in five of our existing markets to better serve changing reader
        and
        advertising needs. Excluding the $0.7 million net increase in advertising
        revenue from these new nondaily publications, our total advertising revenue
        was
        $87.5 million, down $8.6 million, or 9.0%, from the same quarter last year,
        with
        retail and classified advertising down 5.1% and 12.2%,
        respectively.
 
 In
        addition, our third quarter results continue to reflect the industry’s shift
        from run of press and insert advertising to online advertising. Compared
        to the
        third quarter last year, print advertising revenue was $58.1 million, down
        $9.7 million, or 14.4%, and insert advertising revenue was $16.5 million,
        down
        $0.7 million, or 3.8%. Advertising revenue from specialty products printed
        by
        us, but not a part of main newspaper product, was $3.6 million, up $0.7 million,
        or 24.5%.
 
 Online
        advertising revenue, included in all advertising categories above, was $10.3
        million, up $1.8 million, or 20.6%, due to the strength in the retail online
        and
        employment classified online advertising categories. Online advertising revenue
        represented 11.6% of our total third quarter 2007 advertising revenue, up
        from
        8.9% last year, with total page views, a key measure of interest in our Web
        sites, up 11.4% and traffic from new visitors up 23.9%.
 
 Our
        advertising results exhibit that from time to time, each individual newspaper
        may perform better or worse than our newspaper group as a whole due to certain
        local or regional conditions. The material variances in the advertising
        categories listed above and at each newspaper are discussed in more detail
        in
        our results of operations, which follows.
 
 In
        summary, our entire third quarter advertising revenue performance was affected
        by the downturn in the Florida real estate market. Excluding the revenue
        from
        our ten new nondaily publications, our Florida daily newspapers and
        publications, which account for approximately 32.3% of our total third quarter
        advertising revenue, contributed our entire net decline in advertising
        revenue.
 
 Advertising
        revenue in Jacksonville, our largest newspaper, was down $8.2 million, or
        25.2%,
        with declines in all categories. While a portion of Jacksonville’s decline may
        be attributed to the non-recurring gains last year, most of its decline was
        due
        to the downturn in its real estate market. During the third quarter of 2006,
        Jacksonville’s advertising was up $3.0 million, or 10.2%, from the same quarter
        in 2005 due to the strength in the retail and classified categories. For
        comparison purposes, revenue from our Jacksonville newspaper and the newly
        independent Jacksonville*Sun* weeklies, herein, are combined for both
        periods presented.
 
 -16-
 *Table
            of Contents*
   As
        for
        our other Florida newspapers, St. Augustine was down $0.4 million, or 14.1%,
        primarily due to the weakness in the retail and classified print categories,
        and
        Winter Haven was down $0.2 million, or 20.7%, with declines in the retail
        online
        category and in all print categories.
 
 Elsewhere,
        our Savannah newspaper’s advertising revenue was down $0.5 million, or 6.9%,
        with weakness in the retail and classified categories.
 
 Our
        Athens newspaper’s advertising revenue was down $0.3 million, or 9.1%, with
        significant declines in the classified print employment category.
 
 Total
        combined advertising revenue from our other twenty two daily newspapers was
        up
        $0.6 million, or 1.5%, from the prior year, with modest gains in Augusta,
        Grand
        Island, Conway and Bluffton and slight declines in Amarillo, Topeka and Oak
        Ridge.
 
 Advertising
        revenue from all of our nondaily publications, excluding the Jacksonville
        Sun
        weeklies, was up $1.1 million, or 18.5%, primarily due to the incremental
        revenue from our new nondaily publications. Excluding these publications,
        advertising revenue from our non-dailies was up $0.4 million, or 6.9%, with
        the
*Savannah Magazine*(Ga.), *The News and Farmer and Wadley Herald/The
        Jefferson Reporter***(Ga.), *The McDuffie Mirror* (Ga.)
        and the *Capital City Weekly* (Alaska) contributing all of the net
        gain.
 
 The
        ten
        new nondaily publications include the Barnwell (S.C.), Sylvania (Ga.), Hampton
        County (S.C.), Edgefield (S.C.), North Augusta (S.C.), Richmond Hill (Ga.),
        and
        Effingham (Ga.) newspapers, and the Athens' (Ga.) *County Publications*,
        Lubbock's (Tex.)  *Frenship Today* and St. Augustine's (Fla.)
*Eco Latino*publications. Advertising revenue from these nondaily
        publications totaled $1.0 million compared to $0.3 million for the same quarter
        last year.
 
 During
        the third quarter of 2007, circulation revenue was $17.1 million, down $0.2
        million, or 1.0%, from the same period last year.
 
 Other
        income was $3.9 million, up $0.2 million, or 4.3%, primarily due to the increase
        in Sunday magazine promotional revenue.
 
 Total
        labor and employee benefit costs were down $0.3 million, or 0.6%, newsprint
        ink
        and supplements costs were down $3.9 million, or 26.3%, and other operating
        costs, excluding depreciation and amortization, were up $0.5 million, or
        1.4%,
        from last year. Depreciation and amortization expense was down $1.3 million,
        or
        23.8%, from last year, due to a large portion of intangible assets becoming
        fully amortized since the third quarter of last year.
 
 Our
        total
        operating costs were favorably impacted by the savings from the significant
        decrease in the consumption and the average cost per tonne of newsprint and
        the
        decrease in FTE’s (or full time equivalents), but were unfavorably impacted
        by the incremental costs associated with our recently introduced or acquired
        publications, and the increase in employee medical insurance costs.
 
 Excluding
        the $0.8 million in incremental operating costs directly associated with
        our new
        nondaily publications, total labor and employee benefit costs were down 1.7%
        from last year, newsprint ink and supplements costs were down 26.7%, and
        other
        operating costs, excluding depreciation and amortization, were up
        0.5%.
 
 Interest
        and loan amortization expense increased by $0.2 million, or 2.4%, due to
        short-term interest rate increases.
 
 On
        September 30, 2006 we declared and recorded an $18 million dividend to Morris
        Communications, in effect, offsetting the loan receivable from Morris
        Communications by the dividend amounts.
 
 Our
        effective tax rate was 37.6% for the third quarter of 2007 and
        2006.
 
 Net
        income for the third quarter of 2007 was $5.0 million, down $1.9 million
        from
        $6.9 million during the same period last year.
 
 -17-
 *Table
            of Contents*
   **Results
        of operations for the three months ended September 30, 2007 compared to
        September 30, 2006**
 
 *Operating
        revenues*. The table below presents operating revenue for the three months
        ended September 30, 2007 compared to the three months ended September 30,
        2006:
 
 **(Dollars
                  in thousands)**
              
              **Three
                  months ended September 30,**
              
              
              **Percentage
                  change****2007**
              
              
              **2006**
              
              
              **2007
                  vs. 2006****Net
                  operating revenues**AdvertisingRetail
              
              $
              45,862
              
              
              $
              47,733
              
              
              
              (3.9
              %)National
              
              
              4,691
              
              
              
              5,658
              
              
              
              (17.1
              %)Classified
              
              
              37,957
              
              
              
              43,024
              
              
              
              (11.8
              %)Total
                  advertising revenues
              
              
              88,510
              
              
              
              96,415
              
              
              
              (8.2
              %)Circulation
              
              
              17,140
              
              
              
              17,310
              
              
              
              (1.0
              %)Other
              
              
              3,884
              
              
              
              3,722
              
              
              
              4.4
              %Total
                  net operating revenues
              
              $
              109,534
              
              
              $
              117,448
              
              
              
              (6.7
              %)
 
 Retail
        advertising revenue:
 
 Total
        retail advertising revenue was $45.9 million, down $1.9 million, or 3.9%,
        from
        last year. Excluding the $0.5 million in additional retail advertising revenue
        from our new nondaily publications, retail advertising revenue was down $2.4
        million, or 5.1%.
 
 Including
        all publications, insert retail revenue was down $0.5 million, or 2.6%; while
        print retail advertising revenue was down $2.7 million, or 9.8%, from last
        year.
        Retail advertising revenue from specialty products printed by us, but not
        a part
        of main newspaper product, was up $0.7 million, or 23.9%. Retail online revenue
        was $2.7 million, up $0.6 million, or 25.3%, from last year.
 
 Our
        Jacksonville newspaper’s retail advertising revenue was down $2.3 million, or
        18.4%, with 83.5% of its net decline from the print category. While part
        of its
        decline may be attributed to the non-recurring gains last year, the majority
        of
        the declines were from retailers dependent on the housing industry. During
        the
        third quarter of 2006, Jacksonville was up $1.4 million, or 13.1%, from the
        prior year due to the strength from home improvement, department and discount
        stores.
 
 Our
        St.
        Augustine newspaper was down $0.2 million, or 16.1%, and our Winter
        Haven newspaper was down $0.1 million, or 21.2%, with their local retailers
        being affected by either the downturn in the real estate market or by the
        rise
        in gasoline prices.
 
 As
        for
        our other daily newspapers, Augusta’s retail advertising revenue was up $0.1
        million, or 1.1%, with the significant gains in banking, electronics, discount
        stores, and telecommunications offset by the declines in department stores,
        hospitals, office supplies and home improvement.
 
 In
        addition, Bluffton was up $0.1 million, or 29.8%, with strength in the specialty
        publications and print categories.
 
 Savannah’s
        retail advertising revenue was down $0.2 million, or 4.7%, with the net gains
        in
        banking, telecommunications and office supplies being offset by declines
        in drug
        stores, furniture, entertainment, grocery, department stores and home
        improvement.
 
 Amarillo
        was down $0.2 million, or 7.9%, with declines in furniture, telecommunications,
        grocery, and banking. Retail was also down due to the closing of several
        major
        department stores.
 
 Total
        combined retail advertising revenue from our other twenty daily newspapers
        was
        up $0.1 million, or 0.7%, from the prior year, with most of these newspapers
        relatively unchanged from last year.
 
 Excluding
        the advertising revenue from our recently acquired or introduced nondaily
        publications, retail advertising revenue for the nondaily publications was
        up
        $0.2 million, or 5.7%, from last year, with the strong gains from the
*Savannah Magazine*(Ga.), *The News and Farmer and Wadley Herald/The
        Jefferson Reporter***(Ga.), and *The McDuffie Mirror*
        (Ga.).
 
 -18-
 *Table
            of Contents*
 
 Retail
        advertising revenue for our ten new nondaily publications was $0.7 million,
        up
        $0.5 million from $0.2 million during the same quarter last year.
 
 Classified
        advertising revenue:
 
 Total
        classified advertising revenue was $38.0 million, down $5.1 million, or 11.8%,
        from last year. Excluding the $0.2 million in additional classified advertising
        revenue from our new nondaily publications, classified advertising revenue
        was
        down $5.2 million, or 12.2%.
 
 Including
        all publications, online classified adverting revenue was $7.3 million, up
        $1.1
        million, or 17.5%, with most of the increase driven by the employment category.
        The rollout of *Yahoo! HotJobs*at most of our newspaper’s Web sites
        contributed a large part of the net increase in the employment
        category.
 
 Classified
        print advertising revenue was down $6.0 million, or 16.6%, and classified
        insert
        advertising revenue was down $0.2 million, or 46.1%, from last
        year.
 
 Our
        Jacksonville newspaper’s classified advertising revenue was down $5.1 million,
        or 30.9%, with large declines in the employment, auto and real estate print
        categories. While part of its decline may be attributed to the non-recurring
        gains last year, the majority of the declines were from builders and employers
        related to the housing industry. During the third quarter of 2006, Jacksonville
        was up $1.4 million, or 9.5%, from the prior year.
 
 Our St.
        Augustine newspaper was down $0.2 million, or 12.2%, and our Winter Haven
        newspaper was down $0.1 million, or 18.9%, with declines in all print
        categories.
 
 As
        for
        our other daily newspapers, Grand Island was up $0.2 million, or 20.2%, with
        a
        $0.1 million, or 83.0%, gain in the online employment category.
 
 Augusta
        and Amarillo were each up $0.1 million, or 4.2% and 3.7%, respectively,
        primarily due to online employment growth.
 
 In
        Savannah, our newspaper’s classified advertising revenue was down $0.4 million,
        or 10.8%, with declines in the automotive and employment
        categories.
 
 Athens
        was down $0.3 million, or 20.1%, with significant declines in all print and
        online categories.
 
 The
        total
        combined classified advertising revenue from our other nineteen daily newspapers
        was up $0.3 million, or 3.4%, with significant gains in Conway and Pittsburg.
 
 Excluding
        the classified advertising revenue from our new nondaily publications,
        classified advertising from our nondaily publications was up $0.1 million,
        or
        12.2%, from last year, with the *Capital City Weekly* (Alaska)
        contributing all of the net gain.
 
 National
        advertising revenue:
 
 Total
        national advertising revenue was $4.7 million, down $1.0 million, or 17.1%,
        from
        last year, with Jacksonville down $0.8 million, or 22.7%. Jacksonville was
        down due to consolidations in the wireless industry and the termination of
        large
        programs by an insurance company and a HVAC manufacturer.
 
 In
        addition, Augusta and Savannah were together up $0.1 million, or 14.6% and
        25.5%, respectively.
 
 Circulation
        revenue:
 
 Circulation
        revenue was $17.1 million, down $0.2 million, or 1.0%, from last
        year.
 
 -19-
 *Table
            of Contents*
   Jacksonville
        was down $0.2 million, or 3.4%. Amarillo and Lubbock were both down $0.1
        million, or 6.5% and 4.6%, respectively; all due to increases in carrier
        costs
        or circulation decreases.
 
 Savannah,
        Topeka and Athens were each up $0.1 million, or 6.8%, 4.3% and 10.2%,
        respectively, benefiting from route conversions or subscriber rate
        increases.
 
 Other
        revenue:
 
 Other
        revenue was $3.9 million, up $0.2 million, or 4.3%, from the same period
        last
        year. Other revenue from our new nondaily publications was $0.1
        million.
 
 Commercial
        printing revenue was $2.3 million, down $0.1 million, or 4.0%. Other online
        revenue was $0.2 million, down $0.1 million, or 4.4%. Other miscellaneous
        operating revenue, which includes the *Skirt!* magazines licensing
        revenue and the Sunday magazine promotional revenue, was $1.4 million, up
        $0.4 million, or 37.7%.
 
 During
        the third quarter of 2007, we licensed *Skirt!* magazine for the Houston
        (Texas), Richmond (Va.), Memphis (Tenn.) and Boston (Mass.) markets. In addition
        to ongoing royalty fees based on a percentage of operating revenue, we will
        receive a total of $0.7 million in one-time fees from these four agreements.
        The
        income from the one-time fees under these agreements is being amortized over
        the
        ten year life of each agreement.
 
 During
        the third quarter of 2007, income from all of our *Skirt!* magazine
        license agreements totaled $0.1 million.
 
 ***Net
        operating expense****.* The table below presents the total
        operating expenses and related statistics for the newspaper operations for
        the
        three month periods ended September 30, 2007 and 2006:
 
 **(Dollars
                  in thousands)**
              
              **Three
                  months ended September 30,**
              
              
              **Percentage
                  change****2007**
              
              
              **2006**
              
              
              **2007
                  vs. 2006****Operating
                  expenses**Labor
                  and employee benefits
              
              $
              43,619
              
              
              $
              43,894
              
              
              
              (0.6
              %)Newsprint,
                  ink and supplements
              
              
              10,912
              
              
              
              14,813
              
              
              
              (26.3
              %)Other
                  operating costs
              
              
              33,358
              
              
              
              32,894
              
              
              
              1.4
              %Depreciation
                  and amortization
              
              
              4,161
              
              
              
              5,459
              
              
              
              (23.8
              %)Total
                  operating expenses
              
              $
              92,050
              
              
              $
              97,060
              
              
              
              (5.2
              %)
 
 Labor
        and employee benefits:
 
 Excluding
        the labor and employee benefits cost directly related to our ten new nondaily
        publications, our total labor and employee costs were down $0.7 million,
        or
        1.7%. Total labor and employee benefit costs from our ten new nondaily
        publications were $0.6 million, up $0.5 million from the same quarter last
        year.
 
 Including
        all publications, salaries and wages totaled $31.2 million, up $0.1 million,
        or
        0.2%. Average FTE’s (or full time equivalents) were down 4.3%, primarily due to
        the elimination of less highly compensated positions. Employee severance
        payments for the quarter totaled $0.2 million. Jacksonville’s average FTE’s were
        down 11.8%, contributing 68% of our total net FTE decrease. Excluding the
        employees from our new nondaily publications, average FTE’s were down
        6.1%.
 
 Commissions
        and bonuses were $5.6 million, down $0.4 million, or 5.9%, from the same
        period
        last year, due to the decrease in advertising sales.
 
 Employee
        medical insurance cost was $2.8 million, up $0.5 million, or 22.8%, due to
        the
        increase in claims experience.
 
 Compared
        to last year, post retirement benefit cost was $0.3 million, down $0.1 million,
        or 28.4%.
 
 Newsprint,
        ink and supplements cost:
 
 During
        the third quarter of 2007, newsprint, ink and supplements cost was $10.9
        million, down $3.9 million, or 26.3%.
  -20-
 *Table
            of Contents*
 
 Compared
        to the third quarter of 2007, total newsprint expense was $9.4 million, down
        $3.2 million, or 25.4%, due to the 10.4% decrease in newsprint consumption
        and
        the 16.8% decrease in the average cost per tonne of newsprint. We expect
        the
        average cost per tonne of newsprint to increase during the fourth quarter
        and
        the first of next year due to several anticipated price increases. Consumption
        is expected to remain down.
 
 Supplements
        expense decreased 49.1% to $0.7 million, due to a switch from purchasing
        our
        Sunday comics to printing them in house. Our Sunday comics are currently
        printed
        at Flashes Printing, the commercial printing operation included in the GateHouse
        asset sale. We have not yet determined what effect the sale will have on
        the
        cost of producing these supplements.
 
 Ink
        expense was $0.8 million, relatively flat with the same quarter last
        year.
 
 Other
        operating costs:
 
 Including
        all publications, total other operating costs, excluding depreciation and
        amortization, were $33.4 million, up $0.5 million, or 1.4%. The $1.2 million,
        or
        15.9%, increase in product distribution costs and $0.3 million, or 18.4%,
        increase in utility costs were offset somewhat by the $0.4 million, or 15.7%,
        decrease in promotion and marketing costs and the $0.2 million, or 14.7%,
        reduction in travel and entertainment costs.
 
 Bad
        debt
        expense was up $0.1 million, or 15.8%.
 
 The
        combined technology and shared services fee and management fee charged by
        our
        parent under the management agreement totaled $7.1 million for the third
        quarter, down $0.5 million, or 6.7%, from the third quarter last year, due
        to
        the decrease in total operating revenues.
 
 Total
        other operating costs from our ten new nondaily publications were $0.4 million,
        up $0.3 million from the same quarter last year.
 
 **Financial
        summary for the nine months ended September 30, 2007 compared to September
        30,
        2006**
 
 Compared
        to the first nine months last year, operating income was $45.9 million, down
        $17.1 million, or 27.1%, with total operating revenue of $330.2 million,
        down
        $21.5 million, or 6.1%, and total operating costs of $284.3 million, down
        $4.4
        million, or 1.5%.
 
 Advertising
        revenue for the first nine months was $267.3 million, a decrease of $20.5
        million, or 7.1%, from last year, with retail, classified and national
        advertising revenue down 2.8%, 10.9% and 14.8%, respectively.
 
 Since
        the
        first of last year, we have acquired or introduced ten nondaily publications
        in
        five of our existing markets to better serve changing reader and advertising
        needs. Excluding the advertising revenue from these new publications, our
        total
        advertising revenue was $264.4 million, down $23.2 million, or 8.1%, from
        the
        first nine months last year, with retail and classified advertising revenue
        down
        4.2%, 11.4%, respectively.
 
 In
        addition, our nine month results continue to reflect the industry’s shift from
        run of press and insert advertising to online advertising. Compared to the
        first
        nine months last year, print advertising revenue was $178.4 million, down
        $25.8 million, or 12.6%, and insert advertising revenue was $49.2 million,
        down
        $1.6 million, or 3.1%. Advertising revenue from specialty products printed
        by
        us, but not a part of main newspaper product, was $10.8 million, up $1.6
        million, or 16.6%.
 
 Online
        advertising revenue, included in all advertising categories above, was $28.9
        million, up $5.3 million, or 22.5%, due to the strength in the retail online
        and
        employment classified online advertising categories. For the first nine months
        of 2007, online advertising revenue represented 10.8% of our total
        advertising revenue, up from 8.2% last year.
 
 Our
        advertising results exhibit that from time to time, each individual newspaper
        may perform better or worse than our newspaper group as a whole due to certain
        local or regional conditions. The material variances in the advertising
        categories listed above and at each newspaper are discussed in more detail
        in
        our results of operations, which follows.
  -21-
 *Table
            of Contents*
   Our
        total
        advertising revenue results were primarily impacted by the weak advertising
        environment in Florida, however, the poor performances in some of our other
        larger markets, as well as many of our smaller daily newspapers and nondaily
        publications, also contributed to our net decline. In response to these
        challenges, we are continuing to look at every part of our business, identifying
        and implementing initiatives to further reduce our cost of operations. In
        addition, we are reviewing additional revenue opportunities in each of our
        metro
        markets, focusing on achieving very specific targets to increase
        revenue.
 
 Excluding
        the revenue from our ten new nondaily publications, Florida daily newspapers
        and
        publications, which account for approximately 34.6% our total advertising
        revenue, contributed 89.9% of our entire net decline in advertising
        revenue.
 
 Advertising
        revenue in Jacksonville, our largest newspaper, was down $19.1 million, or
        19.6%, with large declines in all categories. While a portion of Jacksonville’s
        decline may be attributed to the non-recurring gains last year, most of its
        decline was due to the downturn in its real estate market. During the first
        nine
        months of 2006, Jacksonville’ advertising was up $4.9 million, or 5.3%, from the
        same period in 2005, with strength in the retail and classified categories.
        For
        comparison purposes, revenue from our Jacksonville newspaper and the newly
        independent Jacksonville*Sun* weeklies, herein, are combined for both
        periods presented.
 
 Our
        Winter Haven newspaper was down $0.9 million, or 26.7%, and our St. Augustine
        newspaper was down $0.6 million, or 7.7%, with each newspaper having significant
        declines in the retail and classified categories.
 
 As
        for
        our other daily newspapers, Augusta’s advertising revenue was up $0.5 million,
        or 1.8%, with the strength in the classified employment online
        category.
 
 Advertising
        revenue for *Bluffton Today*, our free distribution daily newspaper, was
        up $0.3 million, or 13.5%, with significant gains in the retail specialty
        publications printed by us, but not a part of the main newspaper.
 
 In
        Savannah, our newspaper’s advertising revenue was down $1.7 million, or 7.8%,
        with weakness in the retail and classified categories.
 
 Our
        Athens newspaper’s advertising revenue was down $1.0 million, or 9.2%, with
        large declines in the classified category.
 
 Advertising
        revenue from our Amarillo newspaper was down $0.5 million, or 2.5%, with
        the
        gains in the classified category more than offset by the significant declines
        in
        the retail and national categories.
 
 Total
        combined advertising revenue from our other nineteen daily newspapers was
        down
        $0.1 million, or 0.2%, from the prior year, with most of these newspapers
        relatively unchanged from last year.
 
 Advertising
        revenue from all of our nondaily publications, excluding the
        Jacksonville *Sun*weeklies, was up $2.7 million, or 14.5%,
        primarily due to the incremental revenue from our new nondaily publications.
        Advertising revenue from these new publications was $2.9 million, up $2.6
        million, from $0.3 million for the first nine months last year.
 
 During
        the first nine months of 2007, circulation revenue was $50.9 million, down
        $1.2
        million, or 2.2%, from last year.
 
 Other
        income was $11.9 million, up $0.2 million, or 1.7%, with the increase in
        *Skirt!* magazine license fees and Sunday magazine promotional revenue
        offset somewhat by decreases in commercial printing revenue and other online
        revenue.
 
 Total
        labor and employee benefit costs were up $2.5 million, or 1.9%, newsprint
        ink
        and supplements costs were down $8.7 million, or 19.7%, and other operating
        costs, excluding depreciation and amortization, were up $3.4 million, or
        3.5%.
        Depreciation and amortization expense was down $1.5 million, or 9.6%, from
        last
        year, due to a large portion of intangible assets becoming fully amortized
        since
        the first of last year.
  -22-
 *Table
            of Contents*
 
 Our
        total
        operating costs were favorably impacted by the savings from the decrease
        in
        consumption and average cost per tonne of newsprint, the reduction in
        supplements cost, the reduction in post retirement benefit costs and the
        decrease in FTE’s (or full time equivalents), but were unfavorably impacted by
        the incremental costs associated with our recently introduced or acquired
        publications, the increase in employee medical insurance costs and the increase
        in the average employee pay rate.
 
 Excluding
        the $3.1 million in incremental operating costs associated with our new nondaily
        publications,**total labor and employee benefit costs were up 0.6%
        from last year, newsprint ink and supplements costs were down 20.2%, and
        other
        operating costs, excluding depreciation and amortization, were up
        2.4%.
 
 Interest
        and loan amortization expense increased by $0.8 million, or 2.9%, due to
        short-term interest rate increases and higher average outstanding loan
        balances.
 
 On
        June
        30, 2007, September 30, 2006 and March 31, 2006, we declared and recorded
        $40
        million, $28 million and $15 million in dividends, respectively, to Morris
        Communications, in effect, reducing the loan receivable from Morris
        Communications by the dividend amounts.
 
 Our
        effective tax rate was 39.5% for the first nine months of 2007, compared
        to
        38.2% for the same period last year.
 
 Net
        income for the first nine months of 2007 was $10.7 million, down $11.3 million
        from $22.0 million during last year.
 
 **Results
        of operations for the nine months ended September 30, 2007 compared to September
        30, 2006**
 
 *Net
        operating revenue.* The table below presents the total net operating revenue
        and related statistics for the nine month periods ended September 30, 2007
        and
        2006:
 
 **(Dollars
                  in thousands)**
              
              **Nine
                  months ended September 30,**
              
              
              **Percentage
                  change****2007**
              
              
              **2006**
              
              
              **2007
                  vs. 2006****Net
                  operating revenues**AdvertisingRetail
              
              $
              138,245
              
              
              $
              142,195
              
              
              
              (2.8
              %)National
              
              
              15,300
              
              
              
              17,948
              
              
              
              (14.8
              %)Classified
              
              
              113,728
              
              
              
              127,632
              
              
              
              (10.9
              %)Total
                  advertising revenues
              
              
              267,273
              
              
              
              287,776
              
              
              
              (7.1
              %)Circulation
              
              
              50,941
              
              
              
              52,113
              
              
              
              (2.2
              %)Other
              
              
              11,947
              
              
              
              11,750
              
              
              
              1.7
              %Total
                  net operating revenues
              
              $
              330,161
              
              
              $
              351,639
              
              
              
              (6.1
              %)
 
 Retail
        advertising revenue:
 
 Retail
        advertising revenue was $138.2 million, down $4.0 million, or 2.8%, from
        the
        first nine months last year. Excluding the $2.0 million in additional revenue
        from our new nondaily publications, retail advertising revenue was down $5.9
        million, or 4.2%.
 
 Including
        all publications, insert retail revenue was down $0.9 million, or 2.0%, while
        print retail advertising revenue was down $6.6 million, or 8.0%, from last
        year.
        Retail advertising revenue from specialty products printed by us, but not
        a part
        of main newspaper product, was up $1.4 million, or 16.3%. Retail online revenue
        was $7.8 million, up $2.1 million, or 37.3%, from the first nine months last
        year.
 
 Our
        Jacksonville newspaper’s retail advertising revenue was down $3.9 million, or
        10.9%, due to declines in the print and insert category.While part of
        Jacksonville’s decline may be attributed to the non-recurring gains last year,
        the majority of the declines were from retailers dependent on the housing
        industry. During the first nine months of 2006, Jacksonville was up $1.6
        million, or 4.7%, from the prior year due to the strength from home improvement,
        department and discount stores.
 
 Our
        Winter Haven newspaper was down $0.6 million, or 32.0%, and our St. Augustine
        newspaper was down $0.3 million, or 9.1%, with their local retailers being
        affected by the downturn in the Florida real estate market.
  -23-
 *Table
            of Contents*
 
 As
        for
        our other daily newspapers, *Bluffton Today*, our free distribution daily
        newspaper, was up $0.3 million, or 23.2%, with gains in the retail specialty
        products category.
 
 In
        Savannah, our newspaper’s retail advertising revenue was down $0.6 million, or
        5.8%, with gains in the retail online category more than offset by the declines
        in the print and insert categories.
 
 In
        addition, retail advertising revenue from our Amarillo newspaper was down
        $0.4
        million, or 4.3%. Independence’s retail advertising revenue was down $0.3
        million, or 16.4%.
 
 Total
        combined retail advertising revenue from our other twenty daily newspapers
        was
        up $0.1 million, or 0.2%, from the prior year, with most of these newspapers
        relatively unchanged from last year.
 
 Excluding
        the retail advertising revenue from our recently acquired or introduced nondaily
        publications, retail advertising for the nondaily publications was down $0.3
        million, or 1.2%, from last year. Retail advertising revenue for our ten
        new
        nondaily publications was $2.2 million, up $2.0 million, from $0.2 million
        for
        the first nine months last year.
 
 Classified
        advertising revenue:
 
 Total
        classified advertising revenue was $113.7 million, down $13.9 million, or
        10.9%,
        from last year. Excluding the $0.6 million in additional revenue from our
        new
        nondaily publications, classified advertising revenue was down $14.6 million,
        or
        11.4%.
 
 Including
        all publications, online classified revenue was $20.4 million, up $2.8 million,
        or 15.8%, with most of the increase driven by the employment category.
        Classified print advertising revenue was down $16.3 million, or 15.1%, and
        classified insert advertising revenue was down $0.5 million, or 37.9%, from
        last
        year. Classified advertising revenue from specialty products printed by us,
        but
        not a part of main newspaper product, was up $0.1 million, or
        27.0%.
 
 Our
        Jacksonville newspaper’s classified advertising revenue was down $13.6 million,
        or 26.7%. While part of Jacksonville’s decline may be attributed to the
        non-recurring gains last year, the majority of the decline was from builders
        and
        employers related to the housing industry. During the first nine months of
        2006,
        Jacksonville was up $3.7 million, or 7.9%, from the prior year.
 
 Our St.
        Augustine newspaper was down $0.3 million, or 7.2%, and our Winter Haven
        newspaper was down $0.2 million, or 18.3%, with most of their decline due
        to the
        downturn in the local real estate market.
 
 As
        for
        our other daily newspapers, Augusta’s classified advertising revenue was up $0.3
        million, or 3.3%.
 
 In
        addition, Grand Island and Conway were both up $0.3 million, or 11.1% and
        23.1%,
        respectively..
 
 In
        Savannah, our newspaper’s classified advertising revenue was down $1.2 million,
        or 10.7%.
 
 Our
        Athens newspaper was down $0.8 million, or 17.1%.
 
 Total
        combined classified advertising revenue from our other nineteen daily newspapers
        was up $0.7 million, or 1.7%, from the prior year, with significant gains
        in
        Amarillo, Independence, Dodge City and Pittsburg and a significant decline
        in
        Holland.
 
 Excluding
        the classified advertising revenue from our recently acquired or introduced
        publications, classified advertising from our nondaily publications was up
        $0.1
        million, or 2.4%, from last year. Classified advertising revenue for our
        ten new
        nondaily publications was $0.7 million, up $0.6 million, from $0.1 million
        for
        the first nine months last year.
  -24-
 *Table
            of Contents*
 
 National
        advertising revenue:
 
 Total
        national advertising revenue was $15.3 million, down $2.6 million, or 14.8%,
        from the first nine months last year, with Jacksonville down $1.6 million,
        or
        14.9%.
 
 In
        addition, Lubbock and Amarillo were each down $0.2 million, or 28.5% and
        32.9%, respectively. Augusta and Savannah were each up $0.1 million, or
        8.5% and 7.1%, respectively. Topeka was down $0.1 million, or
        7.0%.
 
 Circulation
        revenue:
 
 Circulation
        revenue was $50.9 million, down $1.2 million, or 2.2%, from the first nine
        months last year, with Jacksonville down $0.9 million, or 6.0%. Jacksonville
        experienced steep declines in single copy and third party sales, due to cut
        backs on last year’s aggressive third party sales programs.
 
 Average
        daily single copies and home delivery copies remained soft, down 4.0% and
        1.6%,
        respectively.
 
 Average
        Sunday single copy and home delivery was down 4.3% and 2.0%,
        respectively.
 
 Other
        revenue:
 
 Other
        revenue was $11.9 million, up $0.2 million, or 1.7%, from the first nine
        months
        last year. Other revenue from our new nondaily publications was $0.4 million,
        up
        $0.3 million from last year.
 
 Including
        all publications, commercial printing revenue was $7.2 million, down $0.4
        million, or 4.9%. Other online revenue was $0.5 million, down $0.4 million,
        or
        44.1%. Sunday weekend magazine promotional revenue was $0.7 million, up $0.6
        million from last year.
 
 Since
        our
        2003 acquisition of the original Charleston magazine, we have expanded
*Skirt!* and now circulate the magazine in
        twelve markets. *Skirt!* is a free monthly magazine for women
        which feature eye-catching graphics and layout, with essays and articles
        designed to attract women, a major consumer segment. Morris currently owns
        and publishes the magazines in six Southeastern markets and has currently
        licensed it in the Atlanta (Ga.), Knoxville (Tenn.), Memphis (Tenn.), Boston
        (Ma.), Houston (Texas) and Richmond (Va.) markets. Morris is actively pursuing
        opportunities in other markets.
 
 Each
        licensing agreement provides us with a one time licensing fee, plus periodic
        royalty fees, based on a percentage of advertising revenues. We believe that
        these licensing arrangements will facilitate the magazine's expansion, in
        turn
        attracting more national advertising exposure and sales.
 
 In
        addition to the four new markets licensed during the third quarter of 2007,
        we
        licensed*Skirt!* magazine for the Atlanta (Ga.) and
        Knoxville (Tenn.) markets during the first quarter of 2006 and 2007,
        respectively. The total income from these two license agreements were $0.2
        million and $0.2 million for the first nine months of 2007 and 2006,
        respectively.
 
 Total
        income from all *Skirt!* magazines license agreements was $0.3
        million compared to $0.2 million during the first nine months last
        year.
 
 Other
        miscellaneous income was $3.2 million, up $0.3 million, or 10%, from last
        year.
  -25-
 *Table
            of Contents*
   ***Net
        operating expense****.* The table below presents the total
        operating expenses and related statistics for the newspaper operations for
        the
        nine month periods ended September 30, 2007 and 2006:
 
 **(Dollars
                  in thousands)**
              
              **Nine
                  months ended September 30,**
              
              
              **Percentage
                  change****2007**
              
              
              **2006**
              
              
              **2007
                  vs. 2006****Operating
                  expenses**Labor
                  and employee benefits
              
              $
              133,813
              
              
              $
              131,326
              
              
              
              1.9
              %Newsprint,
                  ink and supplements
              
              
              35,753
              
              
              
              44,502
              
              
              
              (19.7
              %)Other
                  operating costs
              
              
              100,283
              
              
              
              96,921
              
              
              
              3.5
              %Depreciation
                  and amortization
              
              
              14,443
              
              
              
              15,933
              
              
              
              (9.3
              %)Total
                  operating expenses
              
              $
              284,292
              
              
              $
              288,682
              
              
              
              (1.5
              %)
 
 Labor
        and employee benefits:
 
 Excluding
        the labor and employee benefits cost directly related to our ten new nondaily
        publications, our total labor and employee costs were up $0.8 million, or
        0.6%.
        Total labor and employee benefit costs from our new publications were $1.9
        million, up $1.7 million from the same period last year.
 
 Including
        all publications, salaries and wages totaled $93.4 million, up $1.9 million,
        or
        2.1%. Employee severance costs for the first nine months of 2007 totaled
        $0.2
        million. Average FTE’s (or full time equivalents) were down 1.4%, primarily due
        to the elimination of less highly compensated positions. Jacksonville’s average
        FTE’s were down 4.9%, contributing 86% of our total net decrease. Excluding the
        employees from our ten new nondaily publications, average FTE’s were down
        3.2%.
 
 Commissions
        and bonuses were $16.9 million, down $1.1 million, or 5.9%, from the same
        period
        last year, due to the decrease in advertising sales.
 
 Employee
        medical insurance cost was $10.5 million, up $2.1 million, or 25.7%, due
        to the
        increase in claims experience.
 
 Compared
        to the first nine months last year, post retirement benefit cost was $0.9
        million, down $0.4 million, or 28.3%.
 
 Newsprint,
        ink and supplements cost:
 
 During
        the first nine months of 2007, newsprint, ink and supplements cost was $35.8
        million, down $8.7 million, or 19.7%.
 
 Compared
        to the first nine months of 2007, total newsprint expense was $30.7 million,
        down $6.9 million, or 18.4%, due to the 6.1% decrease in newsprint consumption
        and the 13.2% decrease in the average cost per tonne of newsprint.
 
 Supplements
        expense decreased $1.8 million, or 38.8%, to $2.8 million, due to a switch
        from
        purchasing our Sunday comics to printing them in house. Our Sunday comics
        are
        currently printed at Flashes Printing, the commercial printing operation
        included in the GateHouse asset sale. We have not yet determined what effect
        the
        sale will have on the cost of these supplements.
 
 Ink
        expense totaled $2.2 million, unchanged from the same period last
        year.
 
 Other
        operating costs:
 
 Including
        all publications, total other operating costs, excluding depreciation and
        amortization, were $100.3 million, up $3.4 million, or 3.5%. The $3.0 million,
        or 14.2%, increase in product distribution costs, the $0.5 million, or 9.4%,
        increase in utility costs and the $0.7 million, or 1.8%, increase in other
        miscellaneous operating costs were offset somewhat by the $0.4 million, or
        6.3%,
        decrease in promotion and marketing costs and the $0.3 million, or 8.0%,
        reduction in travel and entertainment costs.
 
 Bad
        debt
        expense was up $0.7 million, or 41.5%.
  -26-
 *Table
            of Contents*
 
 The
        combined technology and shared services fee and management fee charged by
        our
        parent under the management agreement totaled $21.5 million, down $1.4 million,
        or 6.1%, from the first nine months last year, due to the decrease in total
        operating revenues.
 
 Total
        other operating costs from our ten new nondaily publications were $1.2 million,
        up $1.1 million from the same period last year.
 
 **Liquidity
        and capital resources**
 
 We
        believe that our principal sources of liquidity, which are existing cash
        and
        cash equivalents, cash flows provided from operating activities, and the
        borrowing capacity under revolving credit facilities, will be sufficient
        to meet
        our ongoing operating needs. Cash flow generated from operations is our primary
        source of liquidity.
 
 Our
        primary needs for cash are funding operating expense, debt service on our
        bank
        credit facilities and the senior subordinated notes, capital expenditures,
        income taxes, dividends and loans to affiliates, acquisitions and working
        capital. We have pursued, and will continue to pursue, a business strategy
        that
        includes selective acquisitions and new product development.
 
 Cash
        was
        $5.6 million at September 30, 2007, down $1.4 million from $7.0 million at
        December 31, 2006.
 
 ***Operating
        activities.*** Net cash provided by operations was $25.1 million for
        the first nine months of 2007, down $9.2 million from $34.3 million for the
        same
        period in 2006.
 
 Current
        assets were $65.6 million and current liabilities were $55.1 million as of
        September 30, 2007 as compared to current assets of $72.5 million and current
        liabilities of $54.5 million as of December 31, 2006. We manage our working
        capital through the utilization of our revolving credit facility. The
        outstanding balance on the revolving credit facility is classified as a
        long-term liability, in accordance with its terms.
 
 ***Investment
        activities.*** Net cash used in investing activities was $9.9 million
        for the first nine months of 2007, up $6.1 million from $3.8 million for
        the same period in 2006.
 
 For
        the
        first nine months of 2007, we spent $10.0 million on property, plant and
        equipment, of which, $3.2 million was spent on Savannah's new printing press.
        The remaining $0.7 million commitment on the printing press is scheduled
        to be
        paid by the end of 2007. During the second quarter of 2007, we acquired the
        domain name for the *Skirt!*magazines’ Web site for $0.1
        million. Our total capital expenditures for the first nine months last year
        was $5.5 million.
 
 For
        2007,
        we expect our total capital expenditures to be between $12 million and $16
        million.
 
 During
        the first nine months of 2007 and 2006, we received $136 thousand and $133
        thousand, respectively, in net proceeds from the sale of miscellaneous property
        and equipment.
 
 In
        July
        2006, we acquired certain assets and assumed certain liabilities of four
        weekly
        newspapers in Georgia and South Carolina from CommunityNewspapers, Inc. The
        newspapers acquired were *The Barnwell* (S.C.) *People-Sentinel*,
*The Hampton County*(S.C.) *Guardian*, *The Edgefield*
        (S.C.) *Citizen News* and the *Sylvania* (Ga.) *Telephone*,
        all of which will enhance our presence in our Augusta market area. The
        acquisition was accounted for as a purchase and had an aggregate purchase
        price,
        including closing costs, of approximately $4.4 million. We paid cash for
        the
        acquisition.
 
 The
        purchase price of the acquisition was allocated to the estimated fair values
        of
        assets and liabilities acquired. The excess purchase price over the
        fair value of the tangible and intangible net assets was allocated to
        goodwill.
 
 Also
        in
        July 2006, we entered into two license agreements and a non-compete agreement
        with Netlook, Inc. for *Car Paper* and *Career Paper* in order
        to allow us to publish the two free distribution publications and include
        content on our Jacksonville based newspaper Web site, Jacksonville.com. Both
        licenses expire on June 30, 2013 and the non-compete agreement expires in
        July
        2008. We paid a total of $0.8 million, all in cash, for the assets.
 
 -27-
 *Table
            of Contents*
   During
        the third quarter 2005, we sold Savannah’s former production facility to a third
        party and elected to have the net proceeds deposited into an escrow account
        in
        order to potentially fund other acquisitions by ourselves or our parent through
        a tax-deferred Section 1031 exchange. Our parent identified and acquired
        $5.3
        million in qualified replacement property during the first quarter 2006,
        with
        the reductions in the restricted escrow account being offset by an increase
        in
        loan receivable from Morris Communications. The remaining $1.5 million in
        escrow
        became unrestricted cash at March 27, 2006, the expiration date for the
        tax-deferred exchange.
 
 ***Financing
        activities.***Net cash used in financing activities was $16.5
        million for the first nine months of , down $20.7 million from $37.2
        million for the same period in 2006.
 
 *Period
        end debt summary:*
 
 Total
        debt was $526 million at September 30, 2007, up from $524 million at December
        31, 2006. We had $51 million outstanding on our $175 million revolving credit
        facility, up $2 million from $49 million at December 31, 2006.
 
 As
        of
        September 30, 2006, our total debt was $526 million.
 
 As
        of
        September 30, 2007, our annualized cost of debt outstanding was approximately
        7.04%, up from 6.75% at the end of the same quarter last year.
 
 At
        September 30, 2007, we could borrow and use for general corporate purposes
        approximately $55.0 million under the most restrictive covenants of our debt
        arrangements.
 
 *Financial
        covenants:*
 
 On
        July
        3, 2007, we, as borrower, entered into an Amendment No. 1 under the Credit
        Agreement dated as of December 14, 2005 (the “Credit Agreement”). The Credit
        Agreement contains financial covenants requiring us to meet certain financial
        tests on an on-going basis, including minimum interest coverage ratio, minimum
        fixed charge coverage ratio,
 and
        maximum cash flow ratios, based upon consolidated financial results of Morris
        Communications and substantially all of its subsidiaries (including us).
        The
        amendment relaxes these financial tests for an 18 month period from and
        including June 30, 2007 through but excluding December 31, 2008. The $0.2
        million in debt issuance costs associated with this amendment was deferred
        and
        is being amortized over the life of the term loan.
 
 Without
        either an improvement in the Morris Communications consolidated financial
        results in 2008 or a reduction of our indebtedness, we are at risk of failing
        to
        meet one or more of our financial covenants as of December 31, 2008, in which
        event we would be unable to borrow on the revolver and may be required to
        prepay
        the entire principal due under the Credit Agreement.  We intend to
        carefully monitor the consolidated financial results and to take any necessary
        steps to avoid default, which steps may include (i) further amendments or
        refinancing of the Credit Agreement, which could increase our cost of capital,
        or (ii) the sale or transfer of a portion of the assets within the Morris
        Communications consolidated group to third parties or to affiliates with
        the
        sales proceeds being used to reduce our indebtedness.
 
 *Loan
        receivable from  Morris Communications:*
 
 Our
        indenture, with certain restrictions described in Note 2 of our financial
        statements, allows us to make loans to Morris Communications. The total loan
        receivable outstanding at September 30, 2007 was $1.5 million, down $21.7
        million from $23.2 million at December 31, 2006.
 
 The
        interest-bearing portion of all loans from us to our parent bear the same
        rate
        as the borrowings under the Credit Agreement (currently, this rate is LIBOR
        (adjusted to the nearest 1/16th) + 1.0%). We distinguish between intercompany
        transactions incurred in the ordinary course of business and settled on a
        monthly basis (which do not bear interest) and those of a more long-term
        nature
        that are subject to an interest accrual. Interest is accrued on the average
        outstanding long-term balance each month.
  -28-
 *Table
            of Contents*
 
 Given
        the
        historical practice of us and our parent settling a significant portion of
        the
        outstanding loan receivable balance with a dividend, this arrangement is
        considered in substance a capital distribution transaction and is classified
        as
        contra-equity within member’s deficit. In addition, interest accrued on this
        loan receivable is reported as contra-equity within member’s deficiency in
        assets for the periods presented. (See Note 2)
 
 We
        have
        classified the outstanding loan receivable balances, net of the $5.0 million
        and
        $3.6 million in accumulated interest accrued on these receivables as of
        September 30, 2007 and December 31, 2006, respectively, as part of member’s
        deficiency in assets.
 
 During
        the nine month periods ended September 30, 2007 and 2006, we reported the
        $1.4
        million and $1.6 million, respectively, in accrued loan receivable interest
        as
        contra-equity. The average interest rate for the nine month periods ended
        September 30, 2007 and 2006 was 6.3819% and 6.0069%, respectively, on average
        loan receivable balances of $28.5 million and $36.1 million,
        respectively.
 
 *Dividends:*
 
 We,
        with
        certain restrictions under our indenture, may make dividend payments to our
        parent to fund its cash needs for general business purposes, capital
        expenditures and acquisitions. At September 30, 2007, we had an additional
        $78.8
        million available for future restricted payments under the notes
        indenture.
 
 On
        June
        30, 2007, September 30, 2006 and March 31, 2006, we declared and recorded
        $40
        million, $28 million and $15 million, respectively, in dividends to Morris
        Communications that, in turn, utilized the distribution to reduce its debt
        to
        us.
 
 **Morris
        Publishing Finance Co. overview**
 
 Morris
        Publishing Finance Co., a wholly-owned subsidiary of Morris Publishing Group,
        LLC, was incorporated in 2003 for the sole purpose of serving as a co-issuer
        of
        our senior subordinated notes in order to facilitate the offering. Morris
        Publishing Finance Co. does not have any operations or assets of any kind
        and
        will not have any revenue.


-29-
 *Table
          of Contents*






**ITEM
      3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
      MARKET RISK**




There
      have been no material changes regarding the registrants’ market risk position
      from the information provided in our annual report dated December 31, 2006
      filed
      with the Securities and Exchange Commission on Form 10-K.





Although
      some of our outstanding debt is at a fixed rate, increases in the interest
      rates
      applicable to borrowings under our bank credit facilities would result in
      increased interest expense and a reduction in our net income.  (See
      the quantitative and qualitative disclosures about market risk are discussed
      under the caption “Market Risk” in Management’s Discussion and Analysis of
      Financial Condition and Results of Operations in said annual report and Note
      5
      to our unaudited condensed consolidated financial statements as of and for
      the
      three and nine month periods ending September 30, 2007 regarding long-term
      debt).





Based
      on
      our $226 million of variable rate debt at September 30, 2007, a 1.0% increase
      or
      decrease in interest rates on this variable-rate debt would decrease or increase
      interest expense by $2.3 million and net income by $1.4 million.








**ITEM
      4.  CONTROLS AND PROCEDURES**




Our
      management carried out an evaluation, with the participation of our chief
      executive officer and chief financial officer, of the effectiveness of our
      disclosure controls and procedures as of September 30, 2007. Based upon that
      evaluation, our chief executive officer and chief financial officer concluded
      that our disclosure controls and procedures were effective to ensure that
      information required to be disclosed by us in reports that we file or submit
      under the Securities Exchange Act of 1934 is recorded, processed, summarized
      and
      reported within the time periods specified in the rules and forms of the
      Securities and Exchange Commission.





There
      has
      not been any change in our internal control over financial reporting in
      connection with the evaluation required by Rule 13A-15(d) under the Exchange
      Act
      that occurred during the three month period ended September 30, 2007, that
      has
      materially affected, or is reasonably likely to materially affect, our internal
      control over financial reporting.




-30-
 *Table
          of Contents*





**PART
      II**





**Item
      1. Legal Proceedings.**





None.





**Item
      1A. Risk Factors.**





None.





**Item
      2. Unregistered Sales of Equity Securities and Use of
      Proceeds.**





None.





**Item
      3. Defaults Upon Senior Securities.**





None.





**Item
      4. Submission of Matters to a Vote of Security Holders.**





None.





**Item
      5. Other Information.**





None.





**Item
      6. Exhibits.**


**Exhibit**
                **Number**
              
              **Exhibit
                  Description**10.1
              
              Asset
                  Purchase Agreement dated October 23, 2007
                  regarding the sale of fourteen daily newspapers, three nondaily
                  newspapers, a commercial printing operation and related publications
                  to
                  GateHouse Media, Inc.31.1
              
              Rule
                  13a-14(a) Certifications31.2
              
              Rule
                  13a-14(a) Certifications32.1
              
              Section
                  1350 Certifications


-31-
 *Table
          of Contents*


**SIGNATURES**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned, thereunto
      duly authorized.





**MORRIS
                PUBLISHING GROUP, LLC**Date:
                November 14, 2007
            
            By:
            
            /s/
                Steve K. Stone**Steve
                K. Stone****Chief
                Financial Officer****(On
                behalf of the Registrant,**
              **and
                as its principal financial
                officer)**








**SIGNATURES**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned, thereunto
      duly authorized.





**MORRIS
                PUBLISHING FINANCE CO.**Date:
                November 14, 2007
            
            By:
            
            /s/
                Steve K. Stone**Steve
                K. Stone****Chief
                Financial Officer****(On
                behalf of the Registrant,**
              **and
                as its Principal Financial
                Officer)**




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