COMPANY PRESS RELEASE: Tribune Company one of the country’s premier media companies, operating businesses in broadcasting, publishing and on the Internet, has reported diluted earnings per share (EPS), before restructuring charges and non-operating items, of $.21 for the 2001 fourth quarter, compared with $.36 for the 2000 fourth quarter.
For the full year 2001, on the same basis, Tribune reported diluted EPS of $.72, compared with $1.30 for 2000. Including restructuring charges and non-operating items, diluted EPS for the fourth quarter 2001 was $.32, compared with $.11 for the same period in 2000. Including restructuring charges, non-operating items and a loss in 2000 from discontinued operations, diluted EPS for the full year 2001 was $.28, compared with $.70 for 2000.
Cash earnings (defined as net income, before restructuring charges and non-operating items, plus amortization expense) were $134 million in the 2001 fourth quarter, down from $185 million during the same period last year. In the 2001 fourth quarter, cash EPS, excluding restructuring charges and non-operating items, was $.40, down from $.54 per share in the 2000 fourth quarter.
The downturn in the economy and a difficult advertising environment made this a challenging year for us, said John W. Madigan, Tribune chairman and chief executive officer. The tragic events of September 11 increased our newsgathering costs and tested our people. But I have never been more proud of the journalism delivered by our newspapers, television and radio stations, and by our Web sites-our journalists rose to the challenge, as they always do, added Madigan. And our management team responded to the difficult revenue environment by swiftly implementing cost containment initiatives across all of our business units.
During the fourth quarter, Tribune incurred $6.9 million of restructuring charges. Full year 2001 restructuring charges totaled $152 million, which related to the voluntary retirement program and other workforce reductions.
The impact of the cost saving measures announced in June 2001 began taking effect in the fourth quarter and will continue into 2002, said Dennis J. FitzSimons, Tribune president and chief operating officer. Voluntary retirement programs, staff reductions and reduced compensation have allowed us to control costs while devoting more resources to serving our readers, viewers and listeners. For a clearer understanding of our continuing operations, we are providing pro forma results for Tribune’s operating groups in addition to reporting actual results. The pro forma results exclude restructuring charges and non-operating items, and they have been adjusted to take out the impact of the additional week in 2000, and they include Times Mirror for a full year in 2000. In 2001, Tribune’s fiscal year comprised 52 weeks, compared with 53 weeks in 2000, resulting in one less week in the fourth quarter of 2001. Discussion of reported results also exclude restructuring charges and non-operating items.
Tribune’s 2001 fourth quarter operating revenues decreased 13 percent to $1.3 billion, down from $1.5 billion in the 2000 fourth quarter. EBITDA (earnings before interest, taxes, depreciation, amortization and equity results) was down 26 percent to $322 million, compared with $437 million in the fourth quarter of 2000. Tribune’s operating profit declined 34 percent to $212 million, compared with $323 million in the fourth quarter of 2000.
Publishing’s fourth quarter reported revenue declined 13 percent to $983 million, compared with $1.1 billion in 2000. Publishing EBITDA was $223 million, down 29 percent from $314 million in 2000. Publishing operating profit decreased 37 percent to $146 million, down from $234 million last year.
In the fourth quarter, Publishing revenue declined 10 percent to $983 million, compared with $1.1 billion in the same period in 2000. Publishing EBITDA was $223 million, down 28 percent from $308 million in 2000. Publishing operating profit decreased 36 percent to $146 million, from $228 million in 2000. Publishing cash expenses, excluding acquisitions, were down 4 percent.
Fourth quarter retail advertising was down 8 percent year-over-year, about the same as in the third quarter. Declines in department stores, electronics and health care were partially offset by increases in food stores.
National was down 12 percent year-over-year, which is approximately the same as in the third quarter. Declines in financial, high tech/dot.com, travel, resorts and movies/entertainment were partially offset by increases from auto manufacturers.
Classifieds, year-over-year, were down 22 percent. We continue to see help wanted revenue decreases in the 50 percent range reflecting softness in all our newspaper markets. Chicago experienced a decline in the 60 percent range; LA was down in the 55 percent range; and New York was down in the 45 percent range, reflecting the greater impact of the recession in larger markets. Auto advertising declined by 4 percent year over year. Real estate continues to be the bright spot in classifieds with a year over year increase of 2 percent.
Cash operating expenses, excluding acquisitions, were 4 percent below 2000’s fourth quarter. Newsprint and ink expense was 15 percent below 2000 as newsprint prices were 7 percent below 2000 and consumption was 9 percent lower. Compensation expense was 7 percent lower as savings have been realized from the voluntary retirement program, outsourcing of certain circulation programs at the Los Angeles Times and other reductions in force. Compensation would have been down 11 percent except for a one-time adjustment to workers compensation liabilities. Other cash expenses increased 7 percent due to outsourcing costs at Los Angeles Times and promotional spending for the launch of the new CareerBuilder sections.
Broadcasting and Entertainment’s reported fourth quarter revenue declined 14 percent to $319 million compared with $371 million in 2000. Broadcasting and Entertainment EBITDA was $111 million, down 27 percent from $152 million in 2000. Broadcasting and Entertainment operating profit decreased 34 percent to $81 million from $123 million in 2000.
In the 2001 fourth quarter, operating revenues for Broadcasting and Entertainment decreased 10 percent to $319 million, down from $353 million in 2000. EBITDA fell 24 percent to $111 million from $145 million in 2000. Operating profit in the quarter declined 30 percent to $81 million from $116 million in 2000.
Television revenues, excluding acquisitions, declined 14 percent to $269 million in the 2001 fourth quarter, down from $313 million in 2000. Television cash expenses, excluding acquisitions, were down 2 percent.
Revenues for Radio increased 7 percent to $14 million, up from $13 million in 2000.
Revenues for Entertainment/Other increased 12 percent to $26 million, up from $24 million in 2000, due mainly to increased advertising revenues at Tribune Entertainment and two additional Cubs home games in the quarter.
Interactive’s reported fourth quarter revenue increased 21 percent to $16.3 million, up from $13.4 million in 2000. Interactive operating cash flow losses decreased 73 percent to $3.7 million, from $13.7 million in 2000.