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| Journal Communications Reports Fourth Quarter and Full Year 2003 Results |
Printer Friendly Version (PDF) News Release Printer Friendly Version (PDF) Financial Tables MILWAUKEE--(BUSINESS WIRE)--Feb. 5, 2004--Journal Communications (NYSE:JRN) today announced financial results for its fourth quarter and full year ended December 31, 2003. For the quarter ended December 31, 2003, net earnings increased 31.5% to $18.8 million compared to $14.3 million for the quarter ended December 31, 2002. For the full year 2003, net earnings increased 15.4% to $66.8 million compared to $57.9 million for the prior year. For the quarter ended December 31, 2003, continuing operating revenue increased 1.8% to $193.4 million compared to $190.0 million for the quarter ended December 31, 2002. For the full year 2003, continuing operating revenue of $798.3 million was essentially flat compared to $801.4 million in 2002. "Journal Communications recorded numerous achievements in 2003, chief among them our successful public equity offering, which led to the listing of our new class A shares on the New York Stock Exchange in late September. This strategic action -- after 121 years of private ownership -- strengthens our capital structure and allows for greater financial flexibility to enhance our businesses," said Steven J. Smith, chairman and chief executive officer. "In 2003, we successfully began full production at our new $112 million Journal Sentinel facility, which contributed to improving margins during the second half of the year. We also recorded solid revenue gains at our direct marketing and label printing businesses. Although our printing services business was adversely affected by a reduction in revenue from its largest customer, we posted a strong increase in earnings from cost control initiatives and the elimination of low margin operations. And the radio group within our broadcast segment posted its fourth consecutive year of operating earnings growth. It is important to note that we experienced particularly strong sequential improvement in the second half of 2003, fueled by productivity benefits and cost reductions at all of our businesses. "Journal Communications enters 2004 with high quality diversified assets in place, including a solid regional presence in southeast Wisconsin, a number of broadcast stations in mid-sized growth markets and a significant telecommunications network and enterprise business. As we look forward, we are focused on building long-term shareholder value by maximizing earnings in our existing businesses, consistently meeting our financial goals and improving our margin performance. We also expect to make disciplined, strategic acquisitions that will provide a solid return on investment." Costs and Expenses For the quarter ended December 31, 2003, costs and expenses of $162.0 million were essentially flat compared to $163.4 million for the fourth quarter of 2002. For the full year 2003, costs and expenses of $684.9 million were basically even compared to $687.3 million for the prior year. Operating Earnings For the quarter ended December 31, 2003, operating earnings increased 18.0% to $31.4 million compared to $26.6 million for the fourth quarter of 2002, primarily due to productivity benefits from our new production facility as well as lower selling and administrative expenses. For the fourth quarter of 2003, operating earnings margin was 16.2% compared to 14.0% for the fourth quarter of 2002. For the full year 2003, operating earnings of $113.4 million were essentially even compared to $114.1 million for the prior year. Operating earnings margin was also flat year over year. Operating Cash Flow For the quarter ended December 31, 2003, operating cash flow (cash provided by operating activities) increased to $25.2 million from $1.2 million for the fourth quarter of 2002, during which time the company made a $41.2 million pension payment. Excluding that payment, the decrease in year over year operating cash flow in the fourth quarter of 2003 was due to changes in working capital. For the full year 2003, operating cash flow increased 49.5% to $128.7 million compared to $86.1 million for the prior year. Earnings per Share For the quarter ended December 31, 2003, basic and diluted earnings per share were $0.23 and $0.22, respectively, on 80,339,048 and 84,791,046 weighted average number of shares, respectively. This compares to both basic and diluted earnings per share of $0.18 for the fourth quarter of 2002 on 77,767,854 average weighted number of shares. For the full year 2003, basic and diluted earnings per share were $0.84 and $0.80, respectively, on 78,644,722 and 83,096,720 weighted average number of shares, respectively. This compares to both basic and diluted earnings per share of $0.73 for the prior year on 79,291,311 weighted average number of shares. Earnings per share amounts are presented on a generally accepted accounting principles basis and reflect the company's new capital structure effected by its initial public offering in September 2003 and the tender offer that was completed in November 2003. EBITDA For the quarter ended December 31, 2003, EBITDA (net earnings plus total other income and expense, provision for income taxes, loss on discontinued operations, net, cumulative effect of accounting change, net, depreciation and amortization) increased 14.0% to $43.2 million from $37.9 million for the fourth quarter of 2002. The increase was primarily due to greater publishing revenues and profit margins and lower selling and administrative expenses. For the full year 2003, EBITDA was $162.0 million, essentially flat compared to $160.7 million for the prior year. Publishing Publishing operating revenue for the quarter ended December 31, 2003, increased 6.6% to $77.7 million from $72.9 million for the fourth quarter of 2002. For the full year 2003, publishing operating revenue increased 1.9% to $317.0 million, compared to $311.1 million for the prior year. Operating earnings from publishing for the quarter ended December 31, 2003, increased 52.2% to $10.2 million compared to $6.7 million for the fourth quarter of 2002. For the full year 2003, operating earnings from publishing increased 9.6% to $33.2 million from $30.3 million for the prior year. The increase is primarily attributed to stronger advertising revenue and cost reduction initiatives at the daily newspaper, cost savings from the structural reorganization of our community newspapers and shoppers operations and a reduction in our workforce due to the new production facility for our daily newspaper. In 2003, newsprint prices per-ton increased by 7.9%. In the fourth quarter, the $600,000 escalation in newsprint costs resulting from price, page count and commercial printing increases was offset by efficiencies due to reductions in the size of the daily newspaper and in waste -- both of which were a direct result of the new production facility. Broadcasting Broadcasting operating revenues for the quarter ended December 31, 2003, declined 3.2% to $39.1 million, compared to $40.4 million for the fourth quarter of 2002. For the full year 2003, broadcasting operating revenues declined 1.4% to $150.7 million from $152.8 million in the prior year. This was primarily due to the loss of television revenues that had accompanied the 2002 Olympics ($2.6 million) and to a decrease in political and issue advertising ($4.9 million). Broadcasting operating earnings for the quarter ended December 31, 2003, declined 8.8% to $10.4 million, compared to $11.4 million for the fourth quarter of 2002. For the full year 2003, broadcasting operating earnings declined 10.5% to $29.9 million from $33.4 million for the prior year. In the quarter ended December 31, 2003, operating revenue from radio stations was $20.2 million, basically even compared to $20.1 million for the fourth quarter of 2002. For the full year 2003, operating revenue from radio stations was $77.9 million, essentially even compared to $78.2 million for the prior year. In the quarter ended December 31, 2003, operating earnings from radio stations increased 12.0% to $5.6 million compared to $5.0 million for the fourth quarter of 2002. For the full year 2003, operating earnings from radio stations increased 10.5% to $16.8 million compared to $15.2 million for the prior year, due primarily to reduced administrative and selling expenses. In the quarter ended December 31, 2003, operating revenue from television stations decreased 6.9% to $18.9 million compared to $20.3 million for the fourth quarter of 2002. For the full year 2003, operating revenue from television stations decreased 2.4% to $72.8 million compared to $74.6 million for the prior year. In the quarter ended December 31, 2003, operating earnings from television stations decreased 25.0% to $4.8 million compared to $6.4 million for the fourth quarter of 2002. For the full year 2003, operating earnings from television stations decreased 28.0% to $13.1 million compared to $18.2 million for the prior year. The decrease in earnings is primarily due to an increase in programming and news costs and a decrease in revenues. Telecommunications Operating revenue from telecommunications for the quarter ended December 31, 2003, increased 3.2% to $35.6 million from $34.5 million for the fourth quarter of 2002. For the full year 2003, operating revenue from telecommunications of $149.5 million was basically flat compared to $148.7 million for the prior year, despite a 12.4% gain in revenue in the commercial segment in 2003. For the fourth quarter 2003, operating earnings from telecommunications of $9.4 million were essentially even compared to $9.3 million for the fourth quarter of 2002. For the full year 2003, operating earnings from telecommunications declined 5.4% to $38.8 million from $41.0 million for the prior year due to continuing pricing pressure in the wholesale market. Printing Services Operating revenue from printing services for the quarter ended December 31, 2003 decreased 7.4% to $20.0 million from $21.6 million for the fourth quarter of 2002. For the full year 2003, operating revenue from printing services decreased 12.1% to $86.0 million compared to $97.8 million for the prior year, due primarily to a reduction in revenue from our largest printing customer. For the fourth quarter 2003, operating earnings from printing services increased to $1.1 million from a loss of $1.0 million in the fourth quarter of 2002. For the full year 2003, operating earnings from printing services increased 81.0% to $3.8 million from $2.1 million in the prior year. Earnings for both the fourth quarter and full year 2003 were favorably impacted by cost control initiatives and the elimination of low margin operations. Other Our other segment consists of a label printing business, a direct marketing services business and corporate expenses and eliminations. For the quarter ended December 31, 2003, other operating revenues increased 1.9% to $21.0 million from $20.6 million for the fourth quarter of 2002. For the full year 2003, other operating revenue increased 4.5% to $95.1 million compared to $91.0 million for the prior year. For the fourth quarter of 2003, other operating earnings increased to $0.3 million from $0.2 million for the fourth quarter of 2002. For the full year 2003, other operating earnings increased to $7.7 million from $7.3 million for the prior year. This increase in full year 2003 earnings is a result of a $3.2 million gain from the sale of corporate property as well as strong performances at our label printing and direct mail businesses. Initial Public Offering and Tender Offer Journal Communications class A common stock began trading on the NYSE on September 24, 2003. A total of 19,837,500 shares of our class A common stock were sold to the public, including 2,587,500 shares of class A common stock purchased by the underwriters to cover over-allotments. Of that number, 19,441,500 shares were sold by Journal Communications and 396,000 by a Grant family shareholder. Net proceeds to the company were approximately $266.6 million. Immediately prior to the offering, a share exchange took place. Each outstanding share of common stock of our former parent company was exchanged for three shares of our class B common stock. Immediately following the share exchange, the Grant family shareholders exchanged approximately 41.5% of the class B shares they received in the share exchange for 3,264,000 shares of our class C common stock. Journal Communications used the net proceeds of the offering, as well as borrowings from our debt facility, to purchase 19,999,752 shares of our class B-1 common stock through our tender offer, which expired on November 3, 2003. The purpose of the tender offer was to allow our class B shareholders, who are employee and former employee investors in our employee stock trust, to obtain liquidity for a certain portion of their shares so that they could reduce their personal debt previously incurred to purchase units of beneficial interest in that trust. The tender offer was contemplated and disclosed to our shareholders prior to the share exchange and as part of the initial public offering in order to effect a "synthetic secondary" offering. At December 31, 2003, Journal Communications had the following shares of stock issued and outstanding: 20,191,542 shares of class A common stock; 14,969,693 shares of class B-1 common stock (not including the 4,338,352 shares held by our subsidiary, The Journal Company); 38,303,648 shares of class B-2 common stock (not including the 4,338,353 shares held by The Journal Company), and 3,264,000 shares of class C common stock (all of which are owned by the Grant family). The company's class A shares are traded on the New York Stock Exchange. Class B shares are not traded on the NYSE, and are not convertible to class A shares until after the applicable public sale restriction periods end. First Quarter 2004 Guidance For the first quarter of 2004, Journal Communications currently anticipates operating revenue to be between $185 million and $190 million and net earnings to be between $11 million and $13 million. Webcast of Conference Call A live webcast of the fourth quarter/full year 2003 conference call will be accessible through www.jc.com and www.ccbn.com beginning at 9:00 a.m. CT this morning. An archive of the webcast will be available on these sites today through February 19. For telephone access to this morning's conference call, dial (800) 901-5213 (domestic) or (617) 786-2962 (international) at least 10 minutes prior to the scheduled 9 a.m. CT start. The access code for the conference call is 89354099. Replays of the conference call will be available today through February 8. To hear the replay, dial (888) 286-8010 (domestic) or (617) 801-6888 (international). The access code for the replay is 99048854. Forward-looking Statements This press release contains certain forward-looking statements related to our businesses that are based on our current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties, including changes in advertising demand and other economic conditions that could cause actual results to differ materially from the expectations expressed in forward-looking statements. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. Our written policy on forward-looking statements can be found on page 12 of our most recent Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission. About Journal Communications Journal Communications, Inc., headquartered in Milwaukee, Wisconsin, was founded in 1882. We are a diversified media and communications company with operations in publishing, radio and television broadcasting, telecommunications and printing services. We publish the Milwaukee Journal Sentinel, which serves as the only major daily newspaper for the Milwaukee metropolitan area, and more than 90 community newspapers and shoppers in eight states. We own and operate 38 radio stations and six television stations in 11 states. Through our telecommunications segment, we own and operate a regional fiber optic network in the upper Midwest, provide integrated data communications solutions for small and mid-size business and offer network transmission solutions for other service providers. We also provide a wide range of commercial printing services, including publications, professional journals and documentation material, as well as electronic publishing, kit assembly and fulfillment. Tables Follow
Journal Communications, Inc.
Consolidated Statements of Earnings (unaudited)
(dollars in millions, except for shares and per-share amounts)
Fourth Quarter (A)
-----------------------
2003 2002 % Change
------ ------ --------
Continuing operations:
Operating revenue:
Publishing $77.7 $72.9 6.6
Broadcasting 39.1 40.4 (3.2)
Telecommunications 35.6 34.5 3.2
Printing services 20.0 21.6 (7.4)
Other 21.0 20.6 1.9
----------- -----------
Total operating revenue 193.4 190.0 1.8
Operating costs and expenses:
Publishing 37.5 35.9 4.5
Broadcasting 15.3 14.5 5.5
Telecommunications 20.6 20.5 0.5
Printing services 16.6 18.4 (9.8)
Other 16.8 16.5 1.8
----------- -----------
Total operating costs and expenses 106.8 105.8 0.9
Selling and administrative expenses 55.2 57.6 (4.2)
----------- -----------
Total operating costs and expenses
and selling and administrative
expenses 162.0 163.4 (0.9)
Operating earnings 31.4 26.6 18.0
Other income and expense:
Interest income and dividends 0.2 --
Interest expense, net (0.1) (0.1)
----------- -----------
Total other income and expense 0.1 (0.1)
Earnings from continuing
operations before income taxes
and accounting change 31.5 26.5 18.9
Provision for income taxes 12.7 11.9 6.7
----------- -----------
Earnings from continuing operations
before accounting change 18.8 14.6 28.8
Loss from discontinued operations,
net of applicable income tax
expense (benefit) of $0 and ($1.6) -- (0.3)
Net earnings $18.8 $14.3 31.5
=========== ===========
Weighted average number of shares:
Basic 80,339,048 77,767,854 3.3
Diluted 84,791,046 77,767,854 9.0
Earnings per share:
Basic:
Continuing operations before
accounting change $0.23 $0.19 21.1
Net earnings $0.23 $0.18 27.8
Diluted:
Continuing operations before
accounting change $0.22 $0.19 15.8
Net earnings $0.22 $0.18 22.2
(A) 2003 fourth quarter: October 6, 2003 to December 31, 2003.
2002 fourth quarter: October 7, 2002 to December 31, 2002.
JOURNAL COMMUNICATIONS, INC.
Consolidated Statements of Earnings (audited)
(dollars in millions, except for shares and per-share amounts)
Year Ended December 31
-----------------------
2003 2002 % Change
------ ------ --------
Continuing operations:
Operating revenue:
Publishing $317.0 $311.1 1.9
Broadcasting 150.7 152.8 (1.4)
Telecommunications 149.5 148.7 0.5
Printing services 86.0 97.8 (12.1)
Other 95.1 91.0 4.5
----------- -----------
Total operating revenue 798.3 801.4 (0.4)
Operating costs and expenses:
Publishing 156.8 148.2 5.8
Broadcasting 64.7 59.7 8.4
Telecommunications 84.8 81.7 3.8
Printing services 71.3 82.6 (13.7)
Other 78.2 75.4 3.7
----------- -----------
Total operating costs and expenses 455.8 447.6 1.8
Selling and administrative expenses 229.1 239.7 (4.4)
----------- -----------
Total operating costs and expenses
and selling and administrative
expenses 684.9 687.3 (0.3)
Operating earnings 113.4 114.1 (0.6)
Other income and expense:
Interest income and dividends 0.4 1.0
Interest expense, net (1.9) (0.7)
----------- -----------
Total other income and expense (1.5) 0.3
Earnings from continuing
operations before income taxes
and accounting change 111.9 114.4 (2.2)
Provision for income taxes 45.1 49.4 (8.7)
----------- -----------
Earnings from continuing operations
before accounting change 66.8 65.0 2.8
Loss from discontinued operations,
net of applicable income tax expense
(benefit) of $0 and ($6.6) -- (0.6)
Cumulative effect of accounting
change, net of applicable income
taxes of $1.2 -- (6.5)
Net earnings $66.8 $57.9 15.4
=========== ===========
Weighted average number of shares:
Basic 78,644,722 79,291,311 (0.8)
Diluted 83,096,720 79,291,311 4.8
Earnings per share:
Basic:
Continuing operations before
accounting change $0.84 $0.82 2.4
Net earnings $0.84 $0.73 15.1
Diluted:
Continuing operations before
accounting change $0.80 $0.82 (2.4)
Net earnings $0.80 $0.73 9.6
Journal Communications, Inc.
Segment Information
(dollars in millions)
Operating revenue, Operating earnings, Depreciation and amortization
and Publishing operating revenue by category are prepared in
accordance with GAAP.
Fourth Quarter (A)
(unaudited)
--------------------
2003 2002 % Change
--------- --------- --------
Operating revenue
-----------------
Publishing $77.7 $72.9 6.6
Broadcasting 39.1 40.4 (3.2)
Telecommunications 35.6 34.5 3.2
Printing services 20.0 21.6 (7.4)
Other 21.0 20.6 1.9
--------- ---------
$193.4 $190.0 1.8
========= =========
Operating earnings
------------------
Publishing $10.2 $6.7 52.2
Broadcasting 10.4 11.4 (8.8)
Telecommunications 9.4 9.3 1.1
Printing services 1.1 (1.0) 210.0
Other 0.3 0.2 50.0
--------- ---------
$31.4 $26.6 18.0
========= =========
Depreciation and Amortization
-----------------------------
Publishing $3.7 $3.4 8.8
Broadcasting 2.4 1.7 41.2
Telecommunications 4.4 4.5 (2.2)
Printing services 0.7 1.1 (36.4)
Other 0.6 0.6 0.0
--------- ---------
$11.8 $11.3 4.4
========= =========
(A) 2003 fourth quarter: October 6, 2003 to December 31, 2003.
2002 fourth quarter: October 7, 2002 to December 31, 2002.
Year Ended December 31
(audited)
----------------------
2003 2002 % Change
--------- --------- --------
Operating revenue
-----------------
Publishing $317.0 $311.1 1.9
Broadcasting 150.7 152.8 (1.4)
Telecommunications 149.5 148.7 0.5
Printing services 86.0 97.8 (12.1)
Other 95.1 91.0 4.5
--------- ---------
$798.3 $801.4 (0.4)
========= =========
Operating earnings
------------------
Publishing $33.2 $30.3 9.6
Broadcasting 29.9 33.4 (10.5)
Telecommunications 38.8 41.0 (5.4)
Printing services 3.8 2.1 81.0
Other 7.7 7.3 5.5
--------- ---------
$113.4 $114.1 (0.6)
========= =========
Depreciation and Amortization
-----------------------------
Publishing $16.5 $14.2 16.2
Broadcasting 8.6 7.3 17.8
Telecommunications 17.7 17.1 3.5
Printing services 3.2 5.2 (38.5)
Other 2.6 2.8 (7.1)
--------- ---------
$48.6 $46.6 4.3
========= =========
Journal Communications, Inc.
Publishing Segment Information (unaudited)
(dollars in millions)
Publishing operating revenue by category:
-----------------------------------------
Fourth Quarter of 2003(A) Fourth Quarter of 2002(B)
------------------------- -------------------------
Community Community
Newspapers Newspapers
Daily & Daily & %
Newspaper Shoppers Total Newspaper Shoppers Total Change
--------- -------- ----- --------- -------- ----- ------
Advertising
revenue:
Retail $21.4 $13.2 $34.6 $20.8 $13.4 $34.2 1.2
Classified 13.6 2.0 15.6 13.0 2.0 15.0 4.0
General 2.9 -- 2.9 1.9 -- 1.9 52.6
Other 4.8 0.4 5.2 3.7 0.1 3.8 36.8
------- ------- ------- ------- ------- -------
Total
advertising
revenue 42.7 15.6 58.3 39.4 15.5 54.9 6.2
Circulation
revenue 10.5 0.7 11.2 10.5 0.6 11.1 0.9
Other
revenue 1.3 6.9 8.2 0.6 6.3 6.9 18.8
------- ------- ------- ------- ------- -------
Total
operating
revenue $54.5 $23.2 $77.7 $50.5 $22.4 $72.9 6.6
======= ======= ======= ======= ======= =======
Year Ended Year Ended
December 31, 2003 December 31, 2002
------------------------ ------------------------
Community Community
Newspapers Newspapers
Daily & Daily & %
Newspaper Shoppers Total Newspaper Shoppers Total Change
--------- -------- ----- --------- -------- ----- ------
Advertising
revenue:
Retail $80.7 $56.1 $136.8 $75.5 $57.0 $132.5 3.2
Classified 60.7 8.7 69.4 62.4 9.7 72.1 (3.7)
General 11.0 -- 11.0 10.1 -- 10.1 8.9
Other 18.2 2.0 20.2 15.9 1.4 17.3 16.8
------ ------- ------- ------- ------- -------
Total
advertising
revenue 170.6 66.8 237.4 163.9 68.1 232.0 2.3
Circulation
revenue 43.9 2.9 46.8 45.3 3.1 48.4 (3.3)
Other
revenue 5.1 27.7 32.8 3.7 27.0 30.7 6.8
------- ------- ------- ------- ------ ------
Total
operating
revenue $219.6 $97.4 $317.0 $212.9 $98.2 $311.1 1.9
======= ======= ======= ======= ======== =======
(A) 2003 fourth quarter: October 6, 2003 to December 31, 2003.
(B) 2002 fourth quarter: October 7, 2002 to December 31, 2002.
NOTE: Publishing segment information is provided to facilitate
comparison of our publishing segment results with those of other
publishing companies and is not representative of the overall
business of Journical Communications or its operating results.
Daily newspaper's core newspaper advertising linage by category:
----------------------------------------------------------------
Fourth Quarter(A)
-----------------
2003 2002 % Change
-------- -------- --------
Advertising linage (inches in thousands):
Full run
Retail 187.0 172.8 8.2
Classified 195.2 205.0 (4.8)
General 14.0 13.2 6.1
-------- --------
Total full run 396.2 391.0 1.3
Part run 36.6 21.7 68.7
-------- --------
Total advertising linage 432.8 412.7 4.9
======== ========
Preprint pieces (in millions) 210.9 214.5 (1.7)
======== ========
Full pages of advertising and revenue per page of our community
newspapers and shoppers:
---------------------------------------------------------------
Full pages of advertising:
Community newspapers 24,914 26,990 (7.7)
Shoppers 22,978 23,513 (2.3)
-------- --------
Total full pages of advertising 47,892 50,503 (5.2)
======== ========
Revenue per page $288.43 $272.98 5.7
======== ========
Daily newspaper's core newspaper advertising linage by category:
----------------------------------------------------------------
Year Ended
December 31
-----------------
2003 2002 % Change
-------- -------- --------
Advertising linage (inches in thousands):
Full run
Retail 724.1 695.2 4.2
Classified 877.7 920.4 (4.6)
General 51.5 52.7 (2.3)
-------- --------
Total full run 1,653.3 1,668.3 (0.9)
Part run 124.9 80.3 55.5
-------- --------
Total advertising linage 1,778.2 1,748.6 1.7
======== ========
Preprint pieces (in millions) 834.6 760.5 9.7
======== ========
Full pages of advertising and revenue per page of our
community newspapers and shoppers:
-----------------------------------------------------
Full pages of advertising:
Community newspapers 109,114 117,600 (7.2)
Shoppers 98,002 104,681 (6.4)
-------- --------
Total full pages of advertising 207,116 222,281 (6.8)
======== ========
Revenue per page $285.63 $274.39 4.1
======== ========
NOTE: Publishing segment information is provided to facilitate
comparison of our publishing segment results with those of
other publishing companies and is not representative of the
overall business of Journical Communications or its operating
results.
Journal Communications, Inc.
Reconciliation of our consolidated net earnings to consolidated EBITDA
(unaudited)
(dollars in millions)
Fourth Quarter (A)
----------------------
2003 2002
---------- ----------
Net earnings $18.8 $14.3
Total other (income) and expense (0.1) 0.1
Provision for income taxes 12.7 11.9
Loss from discontinued operations, net -- 0.3
Depreciation 10.9 10.9
Amortization 0.9 0.4
---------- ----------
EBITDA $43.2 $37.9
========== ==========
(A) 2003 fourth quarter: October 6, 2003 to December 31, 2003.
2002 fourth quarter: October 7, 2002 to December 31, 2002.
Year Ended December 31
----------------------
2003 2002
---------- ----------
Net earnings $66.8 $57.9
Total other (income) and expense 1.5 (0.3)
Provision for income taxes 45.1 49.4
Loss from discontinued operations, net -- 0.6
Cumulative effect of accounting change, net -- 6.5
Depreciation 46.4 44.7
Amortization 2.2 1.9
---------- ----------
EBITDA $162.0 $160.7
========== ==========
We believe that EBITDA is relevant and useful because it helps
improve our investors' ability to understand our operating performance
and makes it easier to compare our results with other companies that
have different financing and capital structures or tax rates. We use
EBITDA, among other things, to evaluate our operating performance, to
value prospective acquisitions and as a component of incentive
compensation targets for certain management personnel. Our lenders use
EBITDA as one of the measures of our ability to service our debt.
EBITDA is not a measure of performance calculated in accordance with
accounting principles generally accepted in the United States. EBITDA
should not be considered in isolation of, or as a substitute for, net
earnings as an indicator of operating performance or cash flows
measures from operating performance as a measure of liquidity. EBITDA,
as we calculate it, may not be comparable to EBITDA reported by other
companies. In addition, EBITDA does not represent funds available for
discretionary use.
Journal Communications, Inc.
Consolidated Condensed Balance Sheet (audited)
(dollars in millions)
December 31, December 31,
2003 2002
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $ 8.4 $ 8.5
Receivables, net 96.6 89.9
Inventories, net 15.2 16.2
Prepaid expenses 13.2 11.8
Deferred income taxes 9.0 8.1
------------ ------------
Total current assets 142.4 134.5
Property and equipment, net 314.6 324.4
Goodwill 114.3 112.0
Broadcast licenses 129.5 125.5
Other intangible assets, net 9.9 12.1
Prepaid pension costs 28.4 30.6
Other assets 8.1 5.9
------------ ------------
Total assets $747.2 $745.0
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable to banks -- 90.8
Accounts payable 38.4 37.8
Accrued compensation 24.7 29.7
Deferred revenue 22.6 20.7
Accrued employee benefits 9.8 9.6
Other current liabilities 21.6 9.7
Current portion of long-term liabilities 0.6 1.6
------------ ------------
Total current liabilities 117.7 199.9
Accrued employee benefits 16.5 17.0
Long-term notes payable to banks 84.0 --
Other long term liabilities 8.7 9.3
Deferred income taxes 56.5 42.3
Shareholders' equity 463.8 476.5
------------ ------------
Total liabilities and shareholders' equity $747.2 $745.0
============ ============
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