NEW YORK (AP) _ The McGraw-Hill Cos., owner of Business Week magazine and the Standard & Poor's credit rating agency, reported a sharp decline in first-quarter earnings Thursday that nonetheless beat analysts' expectations by a penny.

McGraw-Hill reported net earnings of $20.4 million for the first three months of the year, compared to a net loss of $24.7 million in the same period a year ago, when the company instituted an accounting change.

Without that change or a one-time gain on the sale of real estate this year, earnings fell by 51 percent to $16.1 million from $33.2 million a year ago. Per-share earnings fell to 8 cents from 17 cents, beating the 7 cents expected by analysts surveyed by Thomson Financial/First Call.

Revenues, including $54.2 million from an educational business acquired last September, grew 7.9 percent to $864.4 million from $784.2 million. Without the effect of the Tribune Education acquisition, revenues rose 1 percent over the same period a year ago.

The company had warned investors in February that its first quarter results would be lower because of a slow advertising market and accounting changes in the way revenues are recorded.

McGraw-Hill's stock closed down 93 cents to $63.96 in trading Thursday on the New York Stock Exchange.

Despite the first quarter profit decline, McGraw-Hill, which also has a major educational publishing division, reaffirmed its targets of growing revenues as well as bottom line figures in the double digits for the year.

Revenues in the company's financial services division grew 13 percent and educational businesses grew 30 percent, but its media division posted a 20 percent revenue decline. Ad pages at its flagship publication Business Week were off 30 percent during the quarter.