Media General Reports First-Quarter Results

Apr 18, 2001, 01:00 ET from Media General

    RICHMOND, Va., April 18 /PRNewswire/ -- Media General (Amex:   MEG.A) today
 announced diluted earnings per share of 15 cents for the first quarter of
 2001, compared with 55 cents for the first quarter of 2000.  Net income was
 $3.4 million, down from $14.4 million in last year's first quarter.
     These earnings exceeded the company's projection from early March that
 first-quarter earnings would be "only a little better than breakeven."  The
 results, however, include a one-time, after-tax gain of $5.8 million
 representing the company's share of the Rocky Mountain News' payment to The
 Denver Post to establish a joint-operating agreement.
     Total revenues for the first quarter increased 15 percent to $198.9
 million from $172.5 million in the 2000 period.  This increase includes the
 results of 13 television stations and five daily newspapers acquired during
 2000.  Excluding these acquisitions, total revenues declined approximately 2
 percent.
     "As expected, our first-quarter results reflect industry-wide decreases in
 advertising in both publishing and broadcasting plus start-up expenses in our
 Interactive Media Division," said J. Stewart Bryan III, Media General's
 chairman and chief executive.  "We are responding to these challenges by
 aggressively managing our operating and capital budgets.  We have instituted
 company-wide cost reductions, including hiring freezes for all but mission-
 critical positions."
     Total segment operating income for the first quarter was $38.8 million,
 compared with $40.9 million in the 2000 period.  Total segment operating cash
 flow was $48.1 million in the first quarter, compared with $51 million in the
 first quarter of 2000.
     Net income from continuing operations in the first quarter of 2001 was
 $3.4 million, or 15 cents per share, compared with $17.3 million, or 66 cents
 per share, in the 2000 period.  Continuing operations do not include an after-
 tax operating loss of $2.9 million in the first quarter of 2000 from Garden
 State Paper Co., which the company sold in August.  The quarterly comparison
 reflects lower segment operating income, higher interest expense, increased
 acquisition intangibles amortization, and the absence of interest income that
 was present in the first quarter of 2000.  On the plus side, Media General
 derived $6.2 million in pretax income from its investment in SP Newsprint Co.
 The company's 33 percent ownership of SP Newsprint generated a pretax loss of
 $891,000 in the first quarter of 2000.
     EBITDA (earnings before interest, taxes, depreciation and amortization)
 from continuing operations for the first quarter of 2001 was $49 million,
 compared with $48.7 million in the 2000 period.  Free cash flow (after-tax
 cash flow from continuing operations minus capital expenditures) was $23.4
 million, compared with $27.8 million one year ago.
     As a result of share repurchases throughout 2000, average shares
 outstanding in the first quarter were 22.9 million, compared with 26 million
 in the prior year.  Media General has not repurchased any additional shares so
 far this year.
     Capital expenditures during the quarter were $9.2 million, down from $10.5
 million in the first quarter of 2000.  The company also reduced its full-year
 forecast for capital expenditures from $99 million to $69 million.
 
     Publishing
     Publishing revenues for the quarter were $137 million, compared with
 $130.3 million in the first quarter of 2000.  Excluding acquisitions and
 divestitures, revenues decreased 2.5 percent.
     First-quarter operating income was $32.6 million vs. $35.1 million in the
 first quarter of 2000.  In this year's first quarter, the company's share of
 the one-time Denver gain plus $2.9 million from acquired properties partially
 offset an $11.4 million decline in operating profits from comparable
 operations.
     The division's results reflect profit declines at nearly all of the
 company's newspapers.  It also reflects extremely soft advertising revenues
 and higher costs, particularly for newsprint, which was priced almost 20
 percent higher than in the first quarter of 2000.
 
     Broadcast
     Broadcast revenues for the first quarter increased 49 percent including
 acquisitions.  Excluding acquisitions, they were down 1.3 percent.
     Aggressive local sales initiatives have been productive, and ratings gains
 continue to translate into additional revenue shares.  These successes,
 however, have been more than offset by weak national advertising and the
 virtual absence of political advertising in 2001.
     First-quarter operating income for the division increased from $6.2
 million a year ago to $7.8 million, including $2.2 million from acquisitions.
 
     Interactive Media
     The Interactive Media Division, which was launched Jan. 1, 2001, posted an
 operating loss of $1.7 million, compared with an operating loss of $350,000 in
 the first quarter of 2000.
     The current-year results include losses of approximately $650,000 and
 $350,000, respectively, from the company's investments in iPipe, an online
 distributor of syndicated content and specialty advertising, and AdOne, a
 national aggregator of classified advertising on the Internet.
     Interactive Media revenues of $2.2 million increased 21 percent from $1.8
 million in the first quarter of 2000, principally from the growth of Media
 General Financial Services, the company's financial data subsidiary.
 
     Outlook
     Media General expects the challenging advertising environment in the first
 quarter to continue through the second quarter and possibly into the second
 half of 2001.  The company projects second-quarter earnings from continuing
 operations to be about 50 cents per share, and it continues to forecast that
 its earnings per share will not exceed $2 for the full year.
     "Despite the current difficulties, there are many positive initiatives
 under way in all of our businesses," Bryan said.  "The Publishing Division is
 developing regional clusters that will provide significant operational
 synergies.  The Broadcast Division is consolidating its national sales efforts
 into one dedicated and coordinated team, and the Interactive Media Division is
 migrating toward subscription models designed to convert anonymous Web
 visitors into valuable online customers.
     "We will do what is necessary to weather this economic slowdown, but we
 will not lose sight of our long-term goals of creating greater value for our
 shareholders, new opportunities for our employees, more choices for our
 customers, and a higher standard of journalism for the communities we serve."
 
     Conference Call
     Media General will discuss first-quarter results during a conference call
 and webcast today at 2 p.m. EST.  To listen to the webcast, log on to
 http://www.mediageneral.com and click on the "Live Earnings Conference" link
 at the top of the home page.  You will need RealPlayer software, downloadable
 free from http://www.real.com/products/player/index.html .  A replay will be
 available from 5 p.m. today until 5 p.m. on Wednesday, April 25, at the same
 Web address.
 
     About Media General
     Media General is an independent, publicly owned communications company
 situated primarily in the Southeast with interests in newspapers, television
 stations, interactive media and diversified information services.  The
 company's publishing assets include The Tampa Tribune, the Richmond Times-
 Dispatch, the Winston-Salem Journal and 22 other daily newspapers in Virginia,
 North Carolina, Florida, Alabama and South Carolina, as well as nearly 100
 other periodicals and a 20 percent interest in The Denver Post.  Media
 General's 26 network-affiliated television stations reach more than 30 percent
 of the television households in the Southeast, and nearly 8 percent of those
 in the United States.  The company's extensive interactive media offerings
 include more than 50 online enterprises.  Media General also has a 33 percent
 interest in SP Newsprint Co., which operates newsprint mills in Dublin, Ga.,
 and Newberg, Ore.
 
     Forward-Looking Statements
     This news release contains forward-looking statements that are subject to
 various risks and uncertainties and should be understood in the context of the
 company's publicly available reports filed with the Securities and Exchange
 Commission.  Media General's future performance could differ materially from
 its current expectations.
 
                              Media General, Inc.
                     Consolidated Statements of Operations
                   (000's omitted except for per share data)
 
                                                          Quarters Ended
                                                     April 1,      March 26,
                                                         2001           2000
     Revenues:
       Publishing                                    $137,006       $130,328
       Broadcasting                                    60,137         40,356
       Interactive Media                                2,195          1,819
       Eliminations                                      (457)           (45)
          Total revenues                              198,881        172,458
 
     Segment operating income:
       Publishing                                      32,622         35,095
       Broadcasting                                     7,830          6,173
       Interactive Media                               (1,681)          (353)
          Total segment operating income               38,771         40,915
 
     Interest expense                                 (13,987)        (1,358)
     Investment income (loss) - SP Newsprint            6,160           (891)
     Acquisition intangibles amortization             (15,128)        (8,095)
     Corporate expenses                                (9,174)        (8,288)
     Other                                               (964)         6,676
 
     Income from continuing operations
      before income taxes                               5,678         28,959
     Income taxes                                       2,328         11,692
 
     Income from continuing operations                  3,350         17,267
     Loss from discontinued operations
      (net of income tax benefit)                         ---         (2,905)
 
     Net income                                        $3,350        $14,362
 
     Earnings per common share:
       Income from continuing operations                $0.15          $0.67
       Loss from discontinued operations                  ---          (0.11)
 
     Net income                                         $0.15          $0.56
 
     Earnings per common share - assuming dilution:
       Income from continuing operations                $0.15          $0.66
       Loss from discontinued operations                  ---          (0.11)
 
     Net income                                         $0.15          $0.55
 
     Weighted average common shares outstanding:
       Basic                                           22,667         25,657
       Diluted                                         22,895         25,959
 
     Segment operating cash flow:
       Publishing                                     $35,224        $41,657
       Broadcasting                                    13,414          9,137
       Interactive Media                                 (496)           187
          Total                                       $48,142        $50,981
 
 

SOURCE Media General
    RICHMOND, Va., April 18 /PRNewswire/ -- Media General (Amex:   MEG.A) today
 announced diluted earnings per share of 15 cents for the first quarter of
 2001, compared with 55 cents for the first quarter of 2000.  Net income was
 $3.4 million, down from $14.4 million in last year's first quarter.
     These earnings exceeded the company's projection from early March that
 first-quarter earnings would be "only a little better than breakeven."  The
 results, however, include a one-time, after-tax gain of $5.8 million
 representing the company's share of the Rocky Mountain News' payment to The
 Denver Post to establish a joint-operating agreement.
     Total revenues for the first quarter increased 15 percent to $198.9
 million from $172.5 million in the 2000 period.  This increase includes the
 results of 13 television stations and five daily newspapers acquired during
 2000.  Excluding these acquisitions, total revenues declined approximately 2
 percent.
     "As expected, our first-quarter results reflect industry-wide decreases in
 advertising in both publishing and broadcasting plus start-up expenses in our
 Interactive Media Division," said J. Stewart Bryan III, Media General's
 chairman and chief executive.  "We are responding to these challenges by
 aggressively managing our operating and capital budgets.  We have instituted
 company-wide cost reductions, including hiring freezes for all but mission-
 critical positions."
     Total segment operating income for the first quarter was $38.8 million,
 compared with $40.9 million in the 2000 period.  Total segment operating cash
 flow was $48.1 million in the first quarter, compared with $51 million in the
 first quarter of 2000.
     Net income from continuing operations in the first quarter of 2001 was
 $3.4 million, or 15 cents per share, compared with $17.3 million, or 66 cents
 per share, in the 2000 period.  Continuing operations do not include an after-
 tax operating loss of $2.9 million in the first quarter of 2000 from Garden
 State Paper Co., which the company sold in August.  The quarterly comparison
 reflects lower segment operating income, higher interest expense, increased
 acquisition intangibles amortization, and the absence of interest income that
 was present in the first quarter of 2000.  On the plus side, Media General
 derived $6.2 million in pretax income from its investment in SP Newsprint Co.
 The company's 33 percent ownership of SP Newsprint generated a pretax loss of
 $891,000 in the first quarter of 2000.
     EBITDA (earnings before interest, taxes, depreciation and amortization)
 from continuing operations for the first quarter of 2001 was $49 million,
 compared with $48.7 million in the 2000 period.  Free cash flow (after-tax
 cash flow from continuing operations minus capital expenditures) was $23.4
 million, compared with $27.8 million one year ago.
     As a result of share repurchases throughout 2000, average shares
 outstanding in the first quarter were 22.9 million, compared with 26 million
 in the prior year.  Media General has not repurchased any additional shares so
 far this year.
     Capital expenditures during the quarter were $9.2 million, down from $10.5
 million in the first quarter of 2000.  The company also reduced its full-year
 forecast for capital expenditures from $99 million to $69 million.
 
     Publishing
     Publishing revenues for the quarter were $137 million, compared with
 $130.3 million in the first quarter of 2000.  Excluding acquisitions and
 divestitures, revenues decreased 2.5 percent.
     First-quarter operating income was $32.6 million vs. $35.1 million in the
 first quarter of 2000.  In this year's first quarter, the company's share of
 the one-time Denver gain plus $2.9 million from acquired properties partially
 offset an $11.4 million decline in operating profits from comparable
 operations.
     The division's results reflect profit declines at nearly all of the
 company's newspapers.  It also reflects extremely soft advertising revenues
 and higher costs, particularly for newsprint, which was priced almost 20
 percent higher than in the first quarter of 2000.
 
     Broadcast
     Broadcast revenues for the first quarter increased 49 percent including
 acquisitions.  Excluding acquisitions, they were down 1.3 percent.
     Aggressive local sales initiatives have been productive, and ratings gains
 continue to translate into additional revenue shares.  These successes,
 however, have been more than offset by weak national advertising and the
 virtual absence of political advertising in 2001.
     First-quarter operating income for the division increased from $6.2
 million a year ago to $7.8 million, including $2.2 million from acquisitions.
 
     Interactive Media
     The Interactive Media Division, which was launched Jan. 1, 2001, posted an
 operating loss of $1.7 million, compared with an operating loss of $350,000 in
 the first quarter of 2000.
     The current-year results include losses of approximately $650,000 and
 $350,000, respectively, from the company's investments in iPipe, an online
 distributor of syndicated content and specialty advertising, and AdOne, a
 national aggregator of classified advertising on the Internet.
     Interactive Media revenues of $2.2 million increased 21 percent from $1.8
 million in the first quarter of 2000, principally from the growth of Media
 General Financial Services, the company's financial data subsidiary.
 
     Outlook
     Media General expects the challenging advertising environment in the first
 quarter to continue through the second quarter and possibly into the second
 half of 2001.  The company projects second-quarter earnings from continuing
 operations to be about 50 cents per share, and it continues to forecast that
 its earnings per share will not exceed $2 for the full year.
     "Despite the current difficulties, there are many positive initiatives
 under way in all of our businesses," Bryan said.  "The Publishing Division is
 developing regional clusters that will provide significant operational
 synergies.  The Broadcast Division is consolidating its national sales efforts
 into one dedicated and coordinated team, and the Interactive Media Division is
 migrating toward subscription models designed to convert anonymous Web
 visitors into valuable online customers.
     "We will do what is necessary to weather this economic slowdown, but we
 will not lose sight of our long-term goals of creating greater value for our
 shareholders, new opportunities for our employees, more choices for our
 customers, and a higher standard of journalism for the communities we serve."
 
     Conference Call
     Media General will discuss first-quarter results during a conference call
 and webcast today at 2 p.m. EST.  To listen to the webcast, log on to
 http://www.mediageneral.com and click on the "Live Earnings Conference" link
 at the top of the home page.  You will need RealPlayer software, downloadable
 free from http://www.real.com/products/player/index.html .  A replay will be
 available from 5 p.m. today until 5 p.m. on Wednesday, April 25, at the same
 Web address.
 
     About Media General
     Media General is an independent, publicly owned communications company
 situated primarily in the Southeast with interests in newspapers, television
 stations, interactive media and diversified information services.  The
 company's publishing assets include The Tampa Tribune, the Richmond Times-
 Dispatch, the Winston-Salem Journal and 22 other daily newspapers in Virginia,
 North Carolina, Florida, Alabama and South Carolina, as well as nearly 100
 other periodicals and a 20 percent interest in The Denver Post.  Media
 General's 26 network-affiliated television stations reach more than 30 percent
 of the television households in the Southeast, and nearly 8 percent of those
 in the United States.  The company's extensive interactive media offerings
 include more than 50 online enterprises.  Media General also has a 33 percent
 interest in SP Newsprint Co., which operates newsprint mills in Dublin, Ga.,
 and Newberg, Ore.
 
     Forward-Looking Statements
     This news release contains forward-looking statements that are subject to
 various risks and uncertainties and should be understood in the context of the
 company's publicly available reports filed with the Securities and Exchange
 Commission.  Media General's future performance could differ materially from
 its current expectations.
 
                              Media General, Inc.
                     Consolidated Statements of Operations
                   (000's omitted except for per share data)
 
                                                          Quarters Ended
                                                     April 1,      March 26,
                                                         2001           2000
     Revenues:
       Publishing                                    $137,006       $130,328
       Broadcasting                                    60,137         40,356
       Interactive Media                                2,195          1,819
       Eliminations                                      (457)           (45)
          Total revenues                              198,881        172,458
 
     Segment operating income:
       Publishing                                      32,622         35,095
       Broadcasting                                     7,830          6,173
       Interactive Media                               (1,681)          (353)
          Total segment operating income               38,771         40,915
 
     Interest expense                                 (13,987)        (1,358)
     Investment income (loss) - SP Newsprint            6,160           (891)
     Acquisition intangibles amortization             (15,128)        (8,095)
     Corporate expenses                                (9,174)        (8,288)
     Other                                               (964)         6,676
 
     Income from continuing operations
      before income taxes                               5,678         28,959
     Income taxes                                       2,328         11,692
 
     Income from continuing operations                  3,350         17,267
     Loss from discontinued operations
      (net of income tax benefit)                         ---         (2,905)
 
     Net income                                        $3,350        $14,362
 
     Earnings per common share:
       Income from continuing operations                $0.15          $0.67
       Loss from discontinued operations                  ---          (0.11)
 
     Net income                                         $0.15          $0.56
 
     Earnings per common share - assuming dilution:
       Income from continuing operations                $0.15          $0.66
       Loss from discontinued operations                  ---          (0.11)
 
     Net income                                         $0.15          $0.55
 
     Weighted average common shares outstanding:
       Basic                                           22,667         25,657
       Diluted                                         22,895         25,959
 
     Segment operating cash flow:
       Publishing                                     $35,224        $41,657
       Broadcasting                                    13,414          9,137
       Interactive Media                                 (496)           187
          Total                                       $48,142        $50,981
 
 SOURCE  Media General