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Table of Contents
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 
 
FORM 10-Q
 
x
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended June 30, 2002
 
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: 1-6383
 
 
MEDIA GENERAL, INC.
(Exact name of registrant as specified in its charter)
 
Commonwealth of Virginia
  
54-0850433
(State or other jurisdiction of
  
(I.R.S. Employer
incorporation or organization)
  
Identification No.)
 
333 E. Franklin St., Richmond, VA
  
23219
(Address of principal executive offices)
  
(Zip Code)
 
(804) 649-6000
(Registrant’s telephone number, including area code)
 
N/A
(Former name, former address and former fiscal year, if changed since last report.)
 
 
Indicate by check mark whether the registrant (1) has 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) has been subject to such filing requirements for the past 90 days.  Yes  ¨  No  x
 
Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of August 4, 2002.
 
Class A Common shares:
   
22,612,439
Class B Common shares:
   
556,574
 

Table of Contents
MEDIA GENERAL, INC.
 
TABLE OF CONTENTS
 
FORM 10-Q REPORT
June 30, 2002
 
    
Page
Part I.    Financial Information
     
      
Item 1.      Financial Statements
     
      
  
1
      
  
3
      
  
4
      
  
5
      
  
18
      
Part II.    Other Information
     
      
  
25
      
  
25
 
        (a)     Exhibits
   
25
 
        (b)     Reports on Form 8-K
   
25
 
  
26

Table of Contents
PART I—FINANCIAL INFORMATION
 
Item 1.    Financial Statements
 
MEDIA GENERAL, INC.
 
CONSOLIDATED CONDENSED BALANCE SHEETS
(000’s except shares)
 
    
June 30,
2002
   
December 30, 2001
    
(Unaudited)
     
ASSETS
              
Current assets:
              
Cash and cash equivalents
   
$
10,358
   
$
9,137
Accounts receivable—net
   
 
102,538
   
 
112,431
Inventories
   
 
6,117
   
 
4,860
Other
   
 
27,852
   
 
36,610
    
  
Total current assets
   
 
146,865
   
 
163,038
    
  
Investments in unconsolidated affiliates
   
 
103,034
   
 
114,588
Other assets
   
 
77,118
   
 
71,308
Property, plant and equipment—net
   
 
376,408
   
 
385,916
Excess of cost over fair value of net identifiable assets of acquired businesses—net
   
 
832,004
   
 
933,957
FCC licenses and other intangibles—net
   
 
826,296
   
 
865,252
    
  
    
$
2,361,725
   
$
2,534,059
    
  
 
See accompanying notes.

1

Table of Contents
MEDIA GENERAL, INC.
 
CONSOLIDATED CONDENSED BALANCE SHEETS
(000’s except shares)
 
    
June 30,
2002
     
December 30,
2001
  
    
(Unaudited)
         
LIABILITIES AND STOCKHOLDERS’ EQUITY
                  
Current liabilities:
                  
Accounts payable
   
$
19,176
 
   
$
19,909
 
Accrued expenses and other liabilities
   
 
80,320
 
   
 
80,588
 
    
  
Total current liabilities
   
 
99,496
 
   
 
100,497
 
    
  
Long-term debt
   
 
702,930
 
   
 
777,662
 
Deferred income taxes
   
 
354,029
 
   
 
350,854
 
Other liabilities and deferred credits
   
 
138,407
 
   
 
141,378
 
Stockholders’ equity:
                  
Preferred stock ($5 cumulative convertible), par value $5 per share:
                  
Authorized 5,000,000 shares; none outstanding
                  
Common stock, par value $5 per share:
                  
Class A, authorized 75,000,000 shares; issued 22,608,205 and 22,420,065 shares
   
 
113,041
 
   
 
112,100
 
Class B, authorized 600,000 shares; issued 556,574 shares
   
 
2,783
 
   
 
2,783
 
Additional paid-in capital
   
 
17,087
 
   
 
10,006
 
Accumulated other comprehensive loss
   
 
(14,112
)
   
 
(21,013
)
Unearned compensation
   
 
(6,143
)
   
 
(6,780
)
Retained earnings
   
 
954,207
 
   
 
1,066,572
 
    
  
Total stockholders’ equity
   
 
1,066,863
 
   
 
1,163,668
 
    
  
    
$
2,361,725
 
   
$
2,534,059
 
    
  
 
See accompanying notes.

2

Table of Contents
 
MEDIA GENERAL, INC.
 
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
(000’s except for per share data)
 
    
Second Quarter Ended
     
Six Months Ended
  
    
June 30,
2002
     
July 1,
2001
     
June 30,
2002
     
July 1,
2001
  
Revenues
   
$
211,752
 
   
$
205,747
 
   
$
406,291
 
   
$
404,628
 
    
  
  
  
Operating costs:
                                    
Production
   
 
85,758
 
   
 
88,499
 
   
 
172,305
 
   
 
179,074
 
Selling, general and administrative
   
 
68,381
 
   
 
67,655
 
   
 
134,865
 
   
 
137,313
 
Depreciation and amortization
   
 
16,892
 
   
 
28,569
 
   
 
33,531
 
   
 
57,899
 
    
  
  
  
Total operating costs
   
 
171,031
 
   
 
184,723
 
   
 
340,701
 
   
 
374,286
 
    
  
  
  
Operating income
   
 
40,721
 
   
 
21,024
 
   
 
65,590
 
   
 
30,342
 
    
  
  
  
Other income (expense):
                                    
Interest expense
   
 
(11,924
)
   
 
(12,437
)
   
 
(25,354
)
   
 
(26,424
)
Investment income (loss)—unconsolidated affiliates
   
 
(3,662
)
   
 
7,307
 
   
 
(5,767
)
   
 
17,205
 
Other, net
   
 
1,200
 
   
 
(3,463
)
   
 
1,623
 
   
 
(3,014
)
    
  
  
  
Total other expense
   
 
(14,386
)
   
 
(8,593
)
   
 
(29,498
)
   
 
(12,233
)
    
  
  
  
Income before income taxes and cumulative effect of change in accounting principle
   
 
26,335
 
   
 
12,431
 
   
 
36,092
 
   
 
18,109
 
Income taxes
   
 
10,073
 
   
 
4,735
 
   
 
13,805
 
   
 
7,063
 
    
  
  
  
Income before cumulative effect of change in accounting principle
   
 
16,262
 
   
 
7,696
 
   
 
22,287
 
   
 
11,046
 
Cumulative effect of change in accounting principle (net of income tax benefit of $12,188)
   
 
—  
 
   
 
—  
 
   
 
(126,336
)
   
 
—  
 
    
  
  
  
Net income (loss)
   
$
16,262
 
   
$
7,696
 
   
$
(104,049
)
   
$
11,046
 
    
  
  
  
Earnings (loss) per common share:
                                    
Income before cumulative effect of change in accounting principle
   
$
0.71
 
   
$
0.34
 
   
$
0.97
 
   
$
0.49
 
Cumulative effect of change in accounting principle
   
 
—  
 
   
 
—  
 
   
 
(5.51
)
   
 
—  
 
    
  
  
  
Net income (loss)
   
$
0.71
 
   
$
0.34
 
   
$
(4.54
)
   
$
0.49
 
    
  
  
  
Earnings (loss) per common share—assuming dilution:
                                    
Income before cumulative effect of change in accounting principle
   
$
0.70
 
   
$
0.33
 
   
$
0.96
 
   
$
0.48
 
Cumulative effect of change in accounting principle
   
 
—  
 
   
 
—  
 
   
 
(5.44
)
   
 
—  
 
    
  
  
  
Net income (loss)
   
$
0.70
 
   
$
0.33
 
   
$
(4.48
)
   
$
0.48
 
    
  
  
  
Dividends paid per common share
   
$
0.18
 
   
$
0.17
 
   
$
0.36
 
   
$
0.34
 
    
  
  
  
 
See accompanying notes.

3

Table of Contents
 
MEDIA GENERAL, INC.
 
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(000’s)
 
    
Six Months Ended
  
    
June 30,
2002
     
July 1,
2001
  
Operating activities:
                  
Net income (loss)
   
$
(104,049
)
   
$
11,046
 
Adjustments to reconcile net income (loss):
                  
Cumulative effect of change in accounting principle
   
 
126,336
 
   
 
—  
 
Depreciation and amortization
   
 
33,531
 
   
 
57,899
 
Deferred income taxes
   
 
5,993
 
   
 
(227