Attached files
| file | filename |
|---|---|
| 8-K - EARNINGS RELEASE FY 11 Q4 - MEREDITH CORP | fy11q4pressrelease8k.htm |
Exhibit 99
MEREDITH DELIVERS OVER 20 PERCENT GROWTH IN FISCAL 2011 EARNINGS PER SHARE
Increases operating profit margin to 16 percent and cash flow by 12 percent
Generates record revenue performance in Integrated Marketing, Brand Licensing and Political Advertising
DES MOINES, IA (July 28, 2011) - Meredith Corporation (NYSE: MDP; www.meredith.com), the leading media and marketing company serving American women, today reported that fiscal 2011 earnings per share increased 22 percent to $2.78, compared to $2.28 in the prior-year period. Excluding special items in both periods, fiscal 2011 earnings per share from continuing operations increased 24 percent to $2.81, compared to $2.27 in the prior-year period. Total Company revenues rose to $1.4 billion and advertising revenues increased to $793 million. In addition, Meredith's cash flow from operations grew 12 percent to $215 million.
“Fiscal 2011 was a year of revenue gains and strong growth in profit and cash flow generation,” said Meredith Chairman and Chief Executive Officer Stephen M. Lacy. “We delivered record revenues at Meredith Integrated Marketing and Brand Licensing, and also set record highs for political and digital advertising. We strengthened our connection to consumers by launching new tablet editions and mobile apps, along with creative enhancements to existing products. Plus, we returned nearly 40 percent of our free cash flow to shareholders and reduced our debt by a third.”
Fiscal 2011 results included the following financial highlights:
• | Operating profit grew 22 percent and operating profit margin increased 270 basis points. These gains were primarily driven by higher advertising revenues and rates, along with a 2 percent decrease in operating expenses; |
• | Local Media Group political advertising revenues were a record $35 million, and non-political advertising revenues increased 4 percent, the second consecutive year of growth; |
• | Meredith Integrated Marketing and Brand Licensing each delivered record revenues along with strong profit growth; and |
• | Meredith returned nearly $70 million to shareholders through dividends and its share repurchase program, a 45 percent increase over the prior-year period. |
Fiscal 2011 fourth quarter earnings per share were $0.66, compared to $0.73 in the prior-year period. Excluding special items, fiscal 2011 fourth quarter earnings per share from continuing operations were $0.67, compared to $0.71. Fiscal 2011 fourth quarter revenues were $353 million, compared to $364 million.
In the fourth quarter of fiscal 2011, Meredith recorded special items related to the closure of the ReadyMade brand, selected workforce reductions, and a favorable adjustment related to the estimated fair value of the contingent consideration related to an acquisition. The net effect of these special items was a nominal charge of $34,000. Information on the special items recorded in fiscal 2011 and fiscal 2010 is available in Tables 1-4 of this press release. Results from ReadyMade have been reclassified to discontinued operations.
Meredith continues to execute a series of well-defined strategic initiatives to accelerate profit and free cash flow growth. These include:
• | Increasing its already strong consumer connection - Enhancing its leadership position with the 75 million American women Meredith reaches every month remains a top priority. In fiscal 2011 Meredith redesigned several of its leading magazines, and has more planned for fiscal 2012. The Company also |
increased unique visitors and page views across its 60 websites by approximately 10 percent and 20 percent, respectively, and increased viewership for its television stations across the country.
• | Strengthening its core magazine and television businesses - Advertising rates grew in both businesses from the prior year, and Meredith completed a number of initiatives to improve efficiencies and reduce costs now and going forward. As a result, operating profit margins improved in both the National and Local media groups. |
• | Aggressively expanding digital activities - Meredith relaunched key websites, including BHG.com and Recipe.com in the fourth quarter of fiscal 2011, and in fiscal 2012 will continue rapid expansion of its mobile apps and launch more interactive tablet editions of its consumer brands. The percentage of Meredith's revenues generated from digital sources continues to grow, reaching an all-time high of approximately 10 percent in fiscal 2011. |
• | Extending key brands to new products and services - The highly successful Better Homes and Gardens brand licensing program continues to grow at Walmart stores, reaching 3,000 SKUs, a six-fold increase since the program launched less than three years ago. Fiscal 2012 plans include emphasizing recent product extensions including paint, bath décor, and ceiling fans and lighting. Additionally, the Better syndicated daily lifestyle television show created by Meredith Video Studios will broaden its reach to more than 80 percent of American households this fall by adding New York City, the nation's largest market. |
• | Significantly growing Meredith Integrated Marketing - Meredith's objective is to grow Meredith Integrated Marketing (MIM) into a third major business unit by the end of fiscal 2014. Cross-selling new services to existing clients and winning new business are the pillars of MIM's growth strategy. In fiscal 2011, MIM made major progress toward this goal by securing key contract renewals with clients such as Kraft and Chrysler, and significantly expanding programs with Lowe's and Ford. |
• | Making select acquisitions and investments to increase scale and capabilities - Meredith positioned itself for future growth by entering into an agreement with the Turner Broadcasting System to run the day-to-day operations of its Peachtree TV (WPCH-TV) station, extending Meredith's presence in the attractive Atlanta market. It also completed the acquisitions of multi-channel food brand EatingWell; women's lifestyle digital brand Real Girls Media; and mobile marketing agency The Hyperfactory. Each of these opportunities possesses significant upside potential. |
• | Increasing cash flow and return a meaningful portion to shareholders - Over the last decade, Meredith has generated nearly $2 billion in cash flow from operations. Over that time, Meredith has returned about half to shareholders through dividends and share repurchases. |
“We have a clear plan in place and are executing against a number of research-based initiatives we believe will accelerate revenue growth and increase operating profit margins and cash flow over time,” Lacy said. “These strategies extend across all of our businesses, have significant digital components, and capitalize on the broad content creation and marketing capabilities we possess. We continue to look to invest in new capabilities to further maximize potential growth opportunities.”
OPERATING DETAIL
LOCAL MEDIA GROUP
Fiscal 2011 Local Media Group operating profit grew more than 65 percent from the prior year to $88 million, and revenues were $322 million, up 14 percent. Both marked the Local Media Group's best performance since pre-recession fiscal 2007. EBITDA margin increased to 35 percent.
Looking more closely at fiscal 2011, Meredith again outperformed the industry as:
• | Non-political advertising revenues grew 4 percent to $256 million. |
• | Eight of Meredith's 10 largest advertising categories grew revenues, led by Automotive, Retail and Media. |
• | Political advertising revenues were a record $35 million, led by strong spending at Meredith stations in Hartford, Las Vegas, Portland and Kansas City. |
“For the second consecutive year, strong advertising revenue performance was broad-based across our largest categories and markets, once again proving local television's unique power to drive consumers to retail,” said Lacy. “We were able to secure higher ad rates and use our strong news ratings to drive political advertising.”
Meredith delivered strong ratings in fiscal 2011. Of note:
• | Meredith's CBS affiliates in Hartford and Flint/Saginaw continue to lead their markets. In Hartford, the local Better Connecticut daily show grew considerably at 3 p.m. |
• | In morning news, Meredith's CBS affiliates in Hartford and Flint/Saginaw and its FOX affiliate in Las Vegas were No. 1 in their markets. News viewership at Meredith's CBS affiliates in Atlanta and Kansas City also grew. |
• | In late night news, Meredith's stations in Portland, Hartford, Nashville, Kansas City, Las Vegas, and Flint/Saginaw were either No. 1 or 2 in their markets. |
Fiscal 2011 fourth quarter Local Media Group operating profit was $19 million and revenues were $78 million. This compares to fiscal 2010 fourth quarter operating profit of $21 million and revenues of $77 million. Meredith recorded $3.2 million less in political advertising in the fourth quarter of fiscal 2011 compared to fiscal 2010.
Fiscal 2011 fourth quarter non-political advertising revenues grew 3 percent to $66 million. Results were impacted by the natural disasters in Japan and the related shortage of newly manufactured Japanese automobiles available for sale.
Looking ahead, the Local Media Group is executing a series of strategic growth initiatives, including continued emphasis on its largest markets with the most upside potential such as Atlanta and Phoenix; redesigns of its station websites; creation of a number of new mobile apps; and expansion of Meredith Video Studios and the reach of its Better show.
NATIONAL MEDIA GROUP
Fiscal 2011 National Media Group operating profit margin improved to 17 percent as operating profit grew 6 percent from the prior year to $180 million. The National Media Group delivered its best operating profit and margin performance since pre-recession fiscal 2008. Revenues were $1.08 billion, compared to $1.10 billion in fiscal 2010. Advertising revenues were $501 million, compared to $525 million in the prior year. Average advertising revenue per magazine page grew more than 5 percent.
Meredith's national media brands once again enhanced their connections to individual consumers across media platforms in fiscal 2011. Examples included:
• | Readership of Meredith magazines increased to 111 million, according to the most recent data from Mediamark Research and Intelligence. |
• | Unique visitors and page views to Meredith's consumer websites each grew by double digits, buoyed by creative enhancements and the acquisition of the Real Girls Media Network. |
• | Meredith launched tablet editions of many of its popular brands - including Better Homes and Gardens, Parents, Family Circle, Fitness and More - across the leading electronic tablet formats, including the Apple iPad and Barnes & Noble's Nook. Additionally, Meredith introduced a variety of mobile apps for smartphones that are increasing consumer interaction with its brands. |
Fiscal 2011 fourth quarter National Media Group operating profit increased 5 percent to $49 million. Revenues were $275 million, compared to $287 million in the prior year. Advertising revenues were $123 million, compared to $134 million in the prior year. Both Meredith Integrated Marketing and Brand Licensing increased revenues and operating profit in the fourth quarter.
“While I am encouraged by the very strong connections our brands continue to have with consumers, our national advertising customers have been challenged by high commodity and fuel costs and a weak economy which are impacting their advertising and marketing budgets,” Lacy said. “In response, we are focusing on content, media platforms and advertising categories that are larger and where growth prospects are better.”
To improve performance, the National Media Group is executing a series of strategic initiatives including:
• | Proving the effectiveness of print advertising. Meredith recently launched a new research-driven product that provides marketers a guaranteed return on their advertising investment in Meredith magazines. An industry first, the Meredith Engagement Dividend© uses The Nielsen Company's highly regarded Homescan data and Meredith's 85 million consumer database to prove increased product sales at retail as a result of print advertising in Meredith brands. |
• | Expanding the food category. Already the National Media Group's largest category, it has proven to be a leading growth category over time. To bolster its food presence, Meredith recently acquired the multiplatform EatingWell Media Group and launched Recipe.com, which combines trusted recipes with instant in-store savings and manufacturer's coupons. |
• | Diversifying advertising revenue streams. This strategy includes increased focus on digital and multi-platform advertising programs, as well as the fast growing retail, beauty and health categories. |
• | Accelerating online consumer marketing initiatives to connect with younger audiences and increase circulation profit by moving more subscription acquisition, renewal and customer service activities online. |
• | Increasing revenues from sources other than advertising. This includes continuing to grow Meredith Integrated Marketing and Brand Licensing. |
OTHER FINANCIAL INFORMATION
In fiscal 2011, Meredith grew free cash flow 11 percent to $185 million from $167 million. During the year, Meredith raised its dividend by 11 percent, its 18th consecutive annual increase, and repurchased approximately 770,000 shares. At June 30, 2011, approximately 550,000 shares remained under current repurchase authorization.
Additionally during fiscal 2011, Meredith reduced its debt by $105 million to $195 million. The weighted average interest rate on Meredith's debt was 4.9 percent, and its debt-to-EBITDA ratio was less than 1 to 1 at June 30, 2011.
Unallocated corporate expenses grew by approximately $4 million in fiscal 2011, due in part to higher investment spending on Next Issue Media and related Tablet development.
All earnings per share figures in the text of this release are diluted. Both basic and diluted earnings per share can be found in the attached condensed consolidated statements of earnings. Information on the special items in both fiscal 2011 and fiscal 2010 is available in Tables 1-4 and in certain previously communicated press releases.
OUTLOOK
Looking at fiscal 2012, Meredith expects continued improvements in National Media Group advertising revenues, with moderating declines in the first half of the fiscal year turning to modest growth in the second half. With two of three issues closed, fiscal 2012 first quarter magazine advertising revenues are expected to be down in the mid-single digits, compared to the prior-year period.
In Local Media, Meredith will be cycling against $34 million of net political advertising revenues recorded in the first half of fiscal 2011. With nine weeks left in the first quarter of fiscal 2012, non-political television advertising pacings are down in the low-single digits, compared to the prior-year period.
Meredith currently expects fiscal 2012 first quarter earnings per share to range from $0.45 to $0.50 and full-year fiscal 2012 earnings per share to range from $2.40 to $2.80.
CONFERENCE CALL WEBCAST
Meredith will host a conference call on July 28, 2011, at 11 a.m. EDT to discuss fiscal 2011 results. A live webcast will be accessible to the public on the Company's website, www.meredith.com, and a replay will be available for one week. A transcript will be available within 48 hours of the call at www.meredith.com
RATIONALE FOR USE AND ACCESS TO NON-GAAP RESULTS
Management uses and presents GAAP and non-GAAP results to evaluate and communicate the performance of the Company. Non-GAAP measures should not be construed as alternatives to GAAP measures. EBITDA and free cash flow are common supplemental measures of performance used by investors and financial analysts. Management believes that EBITDA and free cash flow provide additional analytical tools to clarify the Company's results from core operations and delineate underlying trends. Meredith does not use EBITDA or free cash flow as a measure of liquidity or funds available for management's discretionary use because they include certain contractual and non-discretionary expenditures.
Results excluding special items recorded in fiscal 2011 and fiscal 2010 are also supplemental non-GAAP financial measures. Management believes these items are not reflective of Meredith's ongoing business activities. While results excluding special items are not a substitute for reported results under GAAP, management believes this information is useful as an aid in better understanding Meredith's current performance, performance trends and financial condition. Reconciliations of non-GAAP to GAAP measures are included in the attached tables. The attached condensed consolidated financial statements and reconciliation tables will be made available at www.meredith.com.
SAFE HARBOR
This release contains certain forward-looking statements that are subject to risks and uncertainties. These statements are based on management's current knowledge and estimates of factors affecting the Company and its operations. Statements in this announcement that are forward-looking include, but are not limited to, the statements regarding advertising revenues and investment spending, along with the Company's revenue and earnings per share outlook for the first fiscal quarter and full year fiscal 2012.
Actual results may differ materially from those currently anticipated. Factors that could adversely affect future results include, but are not limited to, downturns in national and/or local economies; a softening of the domestic advertising market; world, national or local events that could disrupt broadcast television; increased consolidation among major advertisers or other events depressing the level of advertising spending; the unexpected loss or insolvency of one or more major clients; the integration of acquired businesses; changes in consumer reading, purchasing and/or television viewing patterns; increases in paper, postage, printing, syndicated programming or other costs; changes in television network affiliation agreements; technological developments affecting products or methods of distribution; changes in government regulations affecting the Company's industries; unexpected changes in interest rates; and the consequences of acquisitions and/or dispositions. The Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.
ABOUT MEREDITH CORPORATION
Meredith Corporation (NYSE: MDP; www.meredith.com) is the leading media and marketing company serving American women. Meredith features multiple well-known national brands - including Better Homes and Gardens, Parents, Family Circle, Ladies' Home Journal, Fitness, More and American Baby - along with local television brands in fast-growing markets. Meredith is the industry leader in creating content in key consumer interest areas such as home, family, health and wellness and self-development. Meredith uses multiple distribution platforms - including print, television, online, mobile, tablets, and video - to give consumers content they desire and to deliver the messages of its advertising and marketing partners. According to the Advertising Industry Reports (AIR) survey of over 1,500 agency and marketing professionals, Meredith is the nation's “Highest Rated Media Company.” Additionally, Meredith uses its many assets to create powerful custom marketing solutions for many of the nation's top brands and companies. Meredith has significantly added to its marketing solution capabilities in recent years through the acquisition of cutting-edge companies in areas such as digital, mobile, word-of-mouth, social and database marketing.
-- # # # # --
Shareholder/Financial Analyst Contact: Mike Lovell Director of Investor Relations Phone: (515) 284.3622 E-mail: Mike.Lovell@Meredith.com | Media Contact: Art Slusark Vice President/Corporate Communications Phone: (515) 284.3404 E-mail: Art.Slusark@Meredith.com | |
Meredith Corporation and Subsidiaries
Consolidated Statements of Earnings (Unaudited)
Three Months | Twelve Months | ||||||||||||||
Period Ended June 30, | 2011 | 2010 | 2011 | 2010 | |||||||||||
(In thousands except per share data) | |||||||||||||||
Revenues | |||||||||||||||
Advertising | $ | 189,002 | $ | 201,976 | $ | 792,792 | $ | 779,359 | |||||||
Circulation | 65,328 | 70,248 | 261,458 | 279,636 | |||||||||||
All other | 98,596 | 91,835 | 346,230 | 323,836 | |||||||||||
Total revenues | 352,926 | 364,059 | 1,400,480 | 1,382,831 | |||||||||||
Operating expenses | |||||||||||||||
Production, distribution, and editorial | 139,572 | 135,789 | 554,101 | 572,292 | |||||||||||
Selling, general, and administrative | 148,975 | 160,002 | 581,543 | 584,528 | |||||||||||
Depreciation and amortization | 10,132 | 10,362 | 39,545 | 40,889 | |||||||||||
Total operating expenses | 298,679 | 306,153 | 1,175,189 | 1,197,709 | |||||||||||
Earnings from operations | 54,247 | 57,906 | 225,291 | 185,122 | |||||||||||
Interest income | 3 | 26 | 31 | 51 | |||||||||||
Interest expense | (2,932 | ) | (3,847 | ) | (12,969 | ) | (18,584 | ) | |||||||
Earnings from continuing operations before income taxes | 51,318 | 54,085 | 212,353 | 166,589 | |||||||||||
Income taxes | (18,043 | ) | (20,238 | ) | (80,743 | ) | (60,955 | ) | |||||||
Earnings from continuing operations | 33,275 | 33,847 | 131,610 | 105,634 | |||||||||||
Loss from discontinued operations, net of taxes | (2,944 | ) | (478 | ) | (4,178 | ) | (1,671 | ) | |||||||
Net earnings | $ | 30,331 | $ | 33,369 | $ | 127,432 | $ | 103,963 | |||||||
Basic earnings per share | |||||||||||||||
Earnings from continuing operations | $ | 0.73 | $ | 0.75 | $ | 2.89 | $ | 2.34 | |||||||
Discontinued operations | (0.06 | ) | (0.01 | ) | (0.09 | ) | (0.04 | ) | |||||||
Basic earnings per share | $ | 0.67 | $ | 0.74 | $ | 2.80 | $ | 2.30 | |||||||
Basic average shares outstanding | 45,339 | 45,381 | 45,497 | 45,289 | |||||||||||
Diluted earnings per share | |||||||||||||||
Earnings from continuing operations | $ | 0.73 | $ | 0.74 | $ | 2.87 | $ | 2.32 | |||||||
Discontinued operations | (0.07 | ) | (0.01 | ) | (0.09 | ) | (0.04 | ) | |||||||
Diluted earnings per share | $ | 0.66 | $ | 0.73 | $ | 2.78 | $ | 2.28 | |||||||
Diluted average shares outstanding | 45,666 | 45,774 | 45,832 | 45,544 | |||||||||||
Dividends paid per share | $ | 0.255 | $ | 0.230 | $ | 0.970 | $ | 0.910 | |||||||
Meredith Corporation and Subsidiaries
Segment Information (Unaudited)
Three Months | Twelve Months | ||||||||||||||
Period Ended June 30, | 2011 | 2010 | 2011 | 2010 | |||||||||||
(In thousands) | |||||||||||||||
Revenues | |||||||||||||||
National media group | |||||||||||||||
Advertising | $ | 122,531 | $ | 134,114 | $ | 501,382 | $ | 524,613 | |||||||
Circulation | 65,328 | 70,248 | 261,458 | 279,636 | |||||||||||
Other revenues | 87,279 | 82,584 | 315,382 | 296,220 | |||||||||||
Total national media group | 275,138 | 286,946 | 1,078,222 | 1,100,469 | |||||||||||
Local media group | |||||||||||||||
Non-political advertising | 65,733 | 63,969 | 256,388 | 245,501 | |||||||||||
Political advertising | 738 | 3,893 | 35,022 | 9,245 | |||||||||||
Other revenues | 11,317 | 9,251 | 30,848 | 27,616 | |||||||||||
Total local media group | 77,788 | 77,113 | 322,258 | 282,362 | |||||||||||
Total revenues | $ | 352,926 | $ | 364,059 | $ | 1,400,480 | $ | 1,382,831 | |||||||
Operating profit | |||||||||||||||
National media group | $ | 49,331 | $ | 46,974 | $ | 179,628 | $ | 170,161 | |||||||
Local media group | 19,294 | 20,619 | 87,852 | 52,910 | |||||||||||
Unallocated corporate | (14,378 | ) | (9,687 | ) | (42,189 | ) | (37,949 | ) | |||||||
Income from operations | $ | 54,247 | $ | 57,906 | $ | 225,291 | $ | 185,122 | |||||||
Depreciation and amortization | |||||||||||||||
National media group | $ | 3,481 | $ | 3,560 | $ | 13,516 | $ | 14,397 | |||||||
Local media group | 6,150 | 6,257 | 24,003 | 24,417 | |||||||||||
Unallocated corporate | 501 | 545 | 2,026 | 2,075 | |||||||||||
Total depreciation and amortization | $ | 10,132 | $ | 10,362 | $ | 39,545 | $ | 40,889 | |||||||
EBITDA 1 | |||||||||||||||
National media group | $ | 52,812 | $ | 50,534 | $ | 193,144 | $ | 184,558 | |||||||
Local media group | 25,444 | 26,876 | 111,855 | 77,327 | |||||||||||
Unallocated corporate | (13,877 | ) | (9,142 | ) | (40,163 | ) | (35,874 | ) | |||||||
Total EBITDA 1 | $ | 64,379 | $ | 68,268 | $ | 264,836 | $ | 226,011 | |||||||
1 EBITDA is earnings from continuing operations before interest, taxes, depreciation, and amortization. | |||||||||||||||
Meredith Corporation and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
June 30, | June 30, | ||||||
Assets | 2011 | 2010 | |||||
(In thousands) | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 27,721 | $ | 48,574 | |||
Accounts receivable, net | 212,365 | 223,630 | |||||
Inventories | 21,529 | 26,807 | |||||
Current portion of subscription acquisition costs | 54,581 | 57,917 | |||||
Current portion of broadcast rights | 3,974 | 5,423 | |||||
Other current assets | 13,568 | 19,076 | |||||
Total current assets | 333,738 | 381,427 | |||||
Property, plant, and equipment | 459,257 | 450,966 | |||||
Less accumulated depreciation | (272,819 | ) | (263,964 | ) | |||
Net property, plant, and equipment | 186,438 | 187,002 | |||||
Subscription acquisition costs | 54,286 | 55,228 | |||||
Broadcast rights | 1,292 | 2,977 | |||||
Other assets | 66,940 | 59,138 | |||||
Intangible assets, net | 545,101 | 552,210 | |||||
Goodwill | 525,034 | 489,334 | |||||
Total assets | $ | 1,712,829 | $ | 1,727,316 | |||
Liabilities and Shareholders' Equity | |||||||
Current liabilities | |||||||
Current portion of long-term debt | $ | 50,000 | $ | 50,000 | |||
Current portion of long-term broadcast rights payable | 8,548 | 9,892 | |||||
Accounts payable | 82,878 | 109,897 | |||||
Accrued expenses and other liabilities | 115,735 | 109,225 | |||||
Current portion of unearned subscription revenues | 151,831 | 159,292 | |||||
Total current liabilities | 408,992 | 438,306 | |||||
Long-term debt | 145,000 | 250,000 | |||||
Long-term broadcast rights payable | 5,431 | 8,961 | |||||
Unearned subscription revenues | 120,024 | 130,699 | |||||
Deferred income taxes | 160,709 | 114,240 | |||||
Other noncurrent liabilities | 97,688 | 96,765 | |||||
Total liabilities | 937,844 | 1,038,971 | |||||
Shareholders' equity | |||||||
Common stock | 36,282 | 36,329 | |||||
Class B stock | 8,776 | 9,086 | |||||
Additional paid-in capital | 58,274 | 66,311 | |||||
Retained earnings | 687,816 | 604,624 | |||||
Accumulated other comprehensive loss | (16,163 | ) | (28,005 | ) | |||
Total shareholders' equity | 774,985 | 688,345 | |||||
Total liabilities and shareholders' equity | $ | 1,712,829 | $ | 1,727,316 | |||
Meredith Corporation and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
Twelve Months Ended June 30, | 2011 | 2010 | |||||
(In thousands) | |||||||
Net cash provided by operating activities | $ | 214,535 | $ | 191,651 | |||
Cash flows from investing activities | |||||||
Acquisitions of businesses | (40,141 | ) | (27,505 | ) | |||
Additions to property, plant, and equipment | (29,906 | ) | (24,721 | ) | |||
Net cash used in investing activities | (70,047 | ) | (52,226 | ) | |||
Cash flows from financing activities | |||||||
Proceeds from issuance of long-term debt | 62,500 | 160,000 | |||||
Repayments of long-term debt | (167,500 | ) | (240,000 | ) | |||
Purchases of Company stock | (24,896 | ) | (6,274 | ) | |||
Dividends paid | (44,240 | ) | (41,345 | ) | |||
Proceeds from common stock issued | 8,676 | 9,573 | |||||
Excess tax benefits from share-based payments | 509 | 606 | |||||
Other | (390 | ) | (1,321 | ) | |||
Net cash used in financing activities | (165,341 | ) | (118,761 | ) | |||
Net increase (decrease) in cash and cash equivalents | (20,853 | ) | 20,664 | ||||
Cash and cash equivalents at beginning of year | 48,574 | 27,910 | |||||
Cash and cash equivalents at end of year | $ | 27,721 | $ | 48,574 | |||
Table 1
Meredith Corporation and Subsidiaries
Supplemental Disclosures Regarding Non-GAAP Financial Measures
Special Items - The following table shows results of operations excluding special items and as reported with the difference being the special items. Results of operations excluding special items are non-GAAP measures. Management's rationale for presenting non-GAAP measures is included in the text of this earnings release.
Period Ended June 30, 2011 | Three Months | Twelve Months | |||||||||||||||||||||
Excluding Special Items | Special Items | As Reported | Excluding Special Items | Special Items | As Reported | ||||||||||||||||||
(In thousands except per share data) | |||||||||||||||||||||||
Revenues | |||||||||||||||||||||||
Advertising | $ | 189,002 | $ | — | $ | 189,002 | $ | 792,792 | $ | — | $ | 792,792 | |||||||||||
Circulation | 65,328 | — | 65,328 | 261,458 | — | 261,458 | |||||||||||||||||
All other | 98,596 | — | 98,596 | 346,230 | — | 346,230 | |||||||||||||||||
Total revenues | 352,926 | — | 352,926 | 1,400,480 | — | 1,400,480 | |||||||||||||||||
Operating expenses | |||||||||||||||||||||||
Production, distribution, and editorial | 139,572 | — | 139,572 | 554,101 | — | 554,101 | |||||||||||||||||
Selling, general, and administrative | 149,162 | (187 | ) | (a) | 148,975 | 581,730 | (187 | ) | (a) | 581,543 | |||||||||||||
Depreciation and amortization | 10,132 | — | 10,132 | 39,545 | — | 39,545 | |||||||||||||||||
Total operating expenses | 298,866 | (187 | ) | 298,679 | 1,175,376 | (187 | ) | 1,175,189 | |||||||||||||||
Income from operations | 54,060 | 187 | 54,247 | 225,104 | 187 | 225,291 | |||||||||||||||||
Interest income | 3 | — | 3 | 31 | — | 31 | |||||||||||||||||
Interest expense | (2,932 | ) | — | (2,932 | ) | (12,969 | ) | — | (12,969 | ) | |||||||||||||
Earnings before income taxes | 51,131 | 187 | 51,318 | 212,166 | 187 | 212,353 | |||||||||||||||||
Income taxes | (20,401 | ) | 2,358 | (18,043 | ) | (83,101 | ) | 2,358 | (80,743 | ) | |||||||||||||
Earnings from continuing operations | 30,730 | 2,545 | 33,275 | 129,065 | 2,545 | 131,610 | |||||||||||||||||
Loss from discontinued operations, net of taxes | (365 | ) | (2,579 | ) | (b) | (2,944 | ) | (1,599 | ) | (2,579 | ) | (b) | (4,178 | ) | |||||||||
Net earnings | $ | 30,365 | $ | (34 | ) | $ | 30,331 | $ | 127,466 | $ | (34 | ) | $ | 127,432 | |||||||||
Basic earnings per share | |||||||||||||||||||||||
Earnings from continuing operations | $ | 0.67 | $ | 0.06 | $ | 0.73 | $ | 2.83 | $ | 0.06 | $ | 2.89 | |||||||||||
Discontinued operations | — | (0.06 | ) | (0.06 | ) | (0.03 | ) | (0.06 | ) | (0.09 | ) | ||||||||||||
Basic earnings per share | $ | 0.67 | $ | — | $ | 0.67 | $ | 2.80 | $ | — | $ | 2.80 | |||||||||||
Basic average shares outstanding | 45,339 | 45,339 | 45,339 | 45,497 | 45,497 | 45,497 | |||||||||||||||||
Diluted earnings per share | |||||||||||||||||||||||
Earnings from continuing operations | $ | 0.67 | $ | 0.06 | $ | 0.73 | $ | 2.81 | $ | 0.06 | $ | 2.87 | |||||||||||
Discontinued operations | (0.01 | ) | (0.06 | ) | (0.07 | ) | (0.03 | ) | (0.06 | ) | (0.09 | ) | |||||||||||
Diluted earnings per share | $ | 0.66 | $ | — | $ | 0.66 | $ | 2.78 | $ | — | $ | 2.78 | |||||||||||
Diluted average shares outstanding | 45,666 | 45,666 | 45,666 | 45,832 | 45,832 | 45,832 | |||||||||||||||||
(a) Reduction in contingent consideration payable of $6.3 million and the reversal of previously accrued restructuring charges of $1.2 million partially offset by current year severance costs of $6.4 million and the write-down of certain identifiable intangibles of $0.9 million | |||||||||||||||||||||||
(b) Write-down of subscription acquisition costs and art and manuscript inventory | |||||||||||||||||||||||
Table 2
Meredith Corporation and Subsidiaries
Supplemental Disclosures Regarding Non-GAAP Financial Measures
Special Items - The following table shows results of operations excluding special items and as reported with the difference being the special items. Results of operations excluding special items are non-GAAP measures. Management's rationale for presenting non-GAAP measures is included in the text of this earnings release.
Period Ended June 30, 2011 | Three Months | Twelve Months | |||||||||||||||||||||
Excluding Special Items | Special Items | As Reported | Excluding Special Items | Special Items | As Reported | ||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Revenues | |||||||||||||||||||||||
National media group | |||||||||||||||||||||||
Advertising | $ | 122,531 | $ | — | $ | 122,531 | $ | 501,382 | $ | — | $ | 501,382 | |||||||||||
Circulation | 65,328 | — | 65,328 | 261,458 | — | 261,458 | |||||||||||||||||
Other revenues | 87,279 | — | 87,279 | 315,382 | — | 315,382 | |||||||||||||||||
Total national media group | 275,138 | — | 275,138 | 1,078,222 | — | 1,078,222 | |||||||||||||||||
Local media group | |||||||||||||||||||||||
Non-political advertising | 65,733 | — | 65,733 | 256,388 | — | 256,388 | |||||||||||||||||
Political advertising | 738 | — | 738 | 35,022 | — | 35,022 | |||||||||||||||||
Other revenues | 11,317 | — | 11,317 | 30,848 | — | 30,848 | |||||||||||||||||
Total local media group | 77,788 | — | 77,788 | 322,258 | — | 322,258 | |||||||||||||||||
Total revenues | $ | 352,926 | $ | — | $ | 352,926 | $ | 1,400,480 | $ | — | $ | 1,400,480 | |||||||||||
Operating profit | |||||||||||||||||||||||
National media group | $ | 48,346 | $ | 985 | (a) | $ | 49,331 | $ | 178,643 | $ | 985 | (a) | $ | 179,628 | |||||||||
Local media group | 19,254 | 40 | (b) | 19,294 | 87,812 | 40 | (b) | 87,852 | |||||||||||||||
Unallocated corporate | (13,540 | ) | (838 | ) | (c) | (14,378 | ) | (41,351 | ) | (838 | ) | (c) | (42,189 | ) | |||||||||
Income from operations | $ | 54,060 | $ | 187 | $ | 54,247 | $ | 225,104 | $ | 187 | $ | 225,291 | |||||||||||
Depreciation and amortization | |||||||||||||||||||||||
National media group | $ | 3,481 | $ | — | $ | 3,481 | $ | 13,516 | $ | — | $ | 13,516 | |||||||||||
Local media group | 6,150 | — | 6,150 | 24,003 | — | 24,003 | |||||||||||||||||
Unallocated corporate | 501 | — | 501 | 2,026 | — | 2,026 | |||||||||||||||||
Total depreciation and amortization | $ | 10,132 | $ | — | $ | 10,132 | $ | 39,545 | $ | — | $ | 39,545 | |||||||||||
EBITDA1 | |||||||||||||||||||||||
National media group | $ | 51,827 | $ | 985 | (a) | $ | 52,812 | $ | 192,159 | $ | 985 | (a) | $ | 193,144 | |||||||||
Local media group | 25,404 | 40 | (b) | 25,444 | 111,815 | 40 | (b) | 111,855 | |||||||||||||||
Unallocated corporate | (13,039 | ) | (838 | ) | (c) | (13,877 | ) | (39,325 | ) | (838 | ) | (c) | (40,163 | ) | |||||||||
TOTAL EBITDA 1 | $ | 64,192 | $ | 187 | $ | 64,379 | $ | 264,649 | $ | 187 | $ | 264,836 | |||||||||||
1 EBITDA is earnings from continuing operations before interest, taxes, depreciation, and amortization. | |||||||||||||||||||||||
(a) Reduction in contingent consideration payable of $6.3 million and the reversal of previously accrued restructuring charges of $0.9 million partially offset by current year severance costs of $5.4 million and the write-down of certain identifiable intangibles of $0.9 million | |||||||||||||||||||||||
(b) Reversal of previously accrued restructuring charges partially offset by current year severance costs | |||||||||||||||||||||||
(c) Severance costs | |||||||||||||||||||||||
Table 3
Meredith Corporation and Subsidiaries
Supplemental Disclosures Regarding Non-GAAP Financial Measures
Special Items - The following table shows results of operations excluding special items and as reported with the difference being the special items. Results of operations excluding special items are non-GAAP measures. Management's rationale for presenting non-GAAP measures is included in the text of this earnings release.
Period Ended June 30, 2010 | Three Months | Twelve Months | |||||||||||||||||||||
Excluding Special Items | Special Items | As Reported | Excluding Special Items | Special Items | As Reported | ||||||||||||||||||
(In thousands except per share data) | |||||||||||||||||||||||
Revenues | |||||||||||||||||||||||
Advertising | $ | 201,976 | $ | — | $ | 201,976 | $ | 779,359 | $ | — | $ | 779,359 | |||||||||||
Circulation | 70,248 | — | 70,248 | 279,636 | — | 279,636 | |||||||||||||||||
All other | 91,835 | — | 91,835 | 323,836 | — | 323,836 | |||||||||||||||||
Total revenues | 364,059 | — | 364,059 | 1,382,831 | — | 1,382,831 | |||||||||||||||||
Operating expenses | |||||||||||||||||||||||
Production, distribution, and editorial | 135,789 | — | 135,789 | 570,845 | 1,447 | (a) | 572,292 | ||||||||||||||||
Selling, general, and administrative | 159,114 | 888 | (b) | 160,002 | 579,255 | 5,273 | (c) | 584,528 | |||||||||||||||
Depreciation and amortization | 10,362 | — | 10,362 | 40,889 | — | 40,889 | |||||||||||||||||
Total operating expenses | 305,265 | 888 | 306,153 | 1,190,989 | 6,720 | 1,197,709 | |||||||||||||||||
Income from operations | 58,794 | (888 | ) | 57,906 | 191,842 | (6,720 | ) | 185,122 | |||||||||||||||
Interest income | 26 | — | 26 | 51 | — | 51 | |||||||||||||||||
Interest expense | (3,847 | ) | — | (3,847 | ) | (18,584 | ) | — | (18,584 | ) | |||||||||||||
Earnings before income taxes | 54,973 | (888 | ) | 54,085 | 173,309 | (6,720 | ) | 166,589 | |||||||||||||||
Income taxes | (22,261 | ) | 2,023 | (d) | (20,238 | ) | (70,146 | ) | 9,191 | (e) | (60,955 | ) | |||||||||||
Earnings from continuing operations | 32,712 | 1,135 | 33,847 | 103,163 | 2,471 | 105,634 | |||||||||||||||||
Loss from discontinued operations, net of taxes | (478 | ) | — | (478 | ) | (1,671 | ) | — | (1,671 | ) | |||||||||||||
Net earnings | $ | 32,234 | $ | 1,135 | $ | 33,369 | $ | 101,492 | $ | 2,471 | $ | 103,963 | |||||||||||
Basic earnings per share | |||||||||||||||||||||||
Earnings from continuing operations | $ | 0.72 | $ | 0.03 | $ | 0.75 | $ | 2.28 | $ | 0.06 | $ | 2.34 | |||||||||||
Discontinued operations | (0.01 | ) | — | (0.01 | ) | (0.04 | ) | — | (0.04 | ) | |||||||||||||
Basic earnings per share | $ | 0.71 | $ | 0.03 | $ | 0.74 | $ | 2.24 | $ | 0.06 | $ | 2.30 | |||||||||||
Basic average shares outstanding | 45,381 | 45,381 | 45,381 | 45,289 | 45,289 | 45,289 | |||||||||||||||||
Diluted earnings per share | |||||||||||||||||||||||
Earnings from continuing operations | $ | 0.71 | $ | 0.03 | $ | 0.74 | $ | 2.27 | $ | 0.05 | $ | 2.32 | |||||||||||
Discontinued operations | (0.01 | ) | — | (0.01 | ) | (0.04 | ) | — | (0.04 | ) | |||||||||||||
Basic earnings per share | $ | 0.70 | $ | 0.03 | $ | 0.73 | $ | 2.23 | $ | 0.05 | $ | 2.28 | |||||||||||
Diluted average shares outstanding | 45,774 | 45,774 | 45,774 | 45,544 | 45,544 | 45,544 | |||||||||||||||||
(a) Write-down of art and manuscript inventory resulting from the repositioning of certain national media group operations | |||||||||||||||||||||||
(b) Reversal of restructuring charges for severance costs offset by the impairment of an investment | |||||||||||||||||||||||
(c) Net severance costs, write-down of subscription acquisition costs, and the impairment of an investment offset by the reversal of restructuring charges | |||||||||||||||||||||||
(d) Resolution of tax contingencies net of additional tax expense related to the reversal of restructuring changes | |||||||||||||||||||||||
(e) Tax benefit as a result of state and local legislation, the resolution of tax contingencies, and the tax benefit of net restructuring charges | |||||||||||||||||||||||
Table 4
Meredith Corporation and Subsidiaries
Supplemental Disclosures Regarding Non-GAAP Financial Measures
Special Items - The following table shows results of operations excluding special items and as reported with the difference being the special items. Results of operations excluding special items are non-GAAP measures. Management's rationale for presenting non-GAAP measures is included in the text of this earnings release.
Period Ended June 30, 2010 | Three Months | Twelve Months | |||||||||||||||||||||
Excluding Special Items | Special Items | As Reported | Excluding Special Items | Special Items | As Reported | ||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Revenues | |||||||||||||||||||||||
National media group | |||||||||||||||||||||||
Advertising | $ | 134,114 | $ | — | $ | 134,114 | $ | 524,613 | $ | — | $ | 524,613 | |||||||||||
Circulation | 70,248 | — | 70,248 | 279,636 | — | 279,636 | |||||||||||||||||
Other revenues | 82,584 | — | 82,584 | 296,220 | — | 296,220 | |||||||||||||||||
Total national media group | 286,946 | — | 286,946 | 1,100,469 | — | 1,100,469 | |||||||||||||||||
Local media group | |||||||||||||||||||||||
Non-political advertising | 63,969 | — | 63,969 | 245,501 | — | 245,501 | |||||||||||||||||
Political advertising | 3,893 | — | 3,893 | 9,245 | — | 9,245 | |||||||||||||||||
Other revenues | 9,251 | — | 9,251 | 27,616 | — | 27,616 | |||||||||||||||||
Total local media group | 77,113 | — | 77,113 | 282,362 | — | 282,362 | |||||||||||||||||
Total revenues | $ | 364,059 | $ | — | $ | 364,059 | $ | 1,382,831 | $ | — | $ | 1,382,831 | |||||||||||
Operating profit | |||||||||||||||||||||||
National media group | $ | 48,325 | $ | (1,351 | ) | (a) | $ | 46,974 | $ | 177,344 | $ | (7,183 | ) | (b) | $ | 170,161 | |||||||
Local media group | 20,156 | 463 | (c) | 20,619 | 52,447 | 463 | (c) | 52,910 | |||||||||||||||
Unallocated corporate | (9,687 | ) | — | (9,687 | ) | (37,949 | ) | — | (37,949 | ) | |||||||||||||
Income from operations | $ | 58,794 | $ | (888 | ) | $ | 57,906 | $ | 191,842 | $ | (6,720 | ) | $ | 185,122 | |||||||||
Depreciation and amortization | |||||||||||||||||||||||
National media group | $ | 3,560 | $ | — | $ | 3,560 | $ | 14,397 | $ | — | $ | 14,397 | |||||||||||
Local media group | 6,257 | — | 6,257 | 24,417 | — | 24,417 | |||||||||||||||||
Unallocated corporate | 545 | — | 545 | 2,075 | — | 2,075 | |||||||||||||||||
Total depreciation and amortization | $ | 10,362 | $ | — | $ | 10,362 | $ | 40,889 | $ | — | $ | 40,889 | |||||||||||
EBITDA1 | |||||||||||||||||||||||
National media group | $ | 51,885 | $ | (1,351 | ) | (a) | $ | 50,534 | $ | 191,741 | $ | (7,183 | ) | (b) | $ | 184,558 | |||||||
Local media group | 26,413 | 463 | (c) | 26,876 | 76,864 | 463 | (c) | 77,327 | |||||||||||||||
Unallocated corporate | (9,142 | ) | — | (9,142 | ) | (35,874 | ) | — | (35,874 | ) | |||||||||||||
Total EBITDA1 | $ | 69,156 | $ | (888 | ) | $ | 68,268 | $ | 232,731 | $ | (6,720 | ) | $ | 226,011 | |||||||||
1 EBITDA is earnings from continuing operations before interest, taxes, depreciation, and amortization. | |||||||||||||||||||||||
(a) Reversal of restructuring charges for severance costs offset by the impairment of an investment | |||||||||||||||||||||||
(b) Severance costs, write-down of art and manuscript inventory and subscription acquisition costs, and the impairment of an investment partially offset by the reversal of restructuring charges | |||||||||||||||||||||||
(c) Reversal of restructuring charges for severance costs | |||||||||||||||||||||||
Table 5
Meredith Corporation and Subsidiaries
Supplemental Disclosures Regarding Non-GAAP Financial Measures
EBITDA
Consolidated EBITDA, which is reconciled to earnings from continuing operations in the following tables, is defined as earnings from continuing operations before interest, taxes, depreciation, and amortization.
Segment EBITDA is a measure of segment earnings before depreciation and amortization.
Three Months Ended June 30, 2011 | Twelve Months Ended June 30, 2011 | ||||||||||||||||||||||||
National Media | Local Media | Unallocated Corporate | Total | National Media | Local Media | Unallocated Corporate | Total | ||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Revenues | $ | 275,138 | $ | 77,788 | $ | — | $ | 352,926 | $ | 1,078,222 | $ | 322,258 | $ | — | $ | 1,400,480 | |||||||||
Operating profit | $ | 49,331 | $ | 19,294 | $ | (14,378 | ) | $ | 54,247 | $ | 179,628 | $ | 87,852 | $ | (42,189 | ) | $ | 225,291 | |||||||
Depreciation and amortization | 3,481 | 6,150 | 501 | 10,132 | 13,516 | 24,003 | 2,026 | 39,545 | |||||||||||||||||
EBITDA | $ | 52,812 | $ | 25,444 | $ | (13,877 | ) | 64,379 | $ | 193,144 | $ | 111,855 | $ | (40,163 | ) | 264,836 | |||||||||
Less: | |||||||||||||||||||||||||
Depreciation and amortization | (10,132 | ) | (39,545 | ) | |||||||||||||||||||||
Net interest expense | (2,929 | ) | (12,938 | ) | |||||||||||||||||||||
Income taxes | (18,043 | ) | (80,743 | ) | |||||||||||||||||||||
Earnings from continuing operations | $ | 33,275 | $ | 131,610 | |||||||||||||||||||||
Segment EBITDA margin | 19.2 | % | 32.7 | % | 17.9 | % | 34.7 | % | |||||||||||||||||
Three Months Ended June 30, 2010 | Twelve Months Ended June 30, 2010 | ||||||||||||||||||||||||
National Media | Local Media | Unallocated Corporate | Total | National Media | Local Media | Unallocated Corporate | Total | ||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Revenues | $ | 286,946 | $ | 77,113 | $ | — | $ | 364,059 | $ | 1,100,469 | $ | 282,362 | $ | — | $ | 1,382,831 | |||||||||
Operating profit (loss) | $ | 46,974 | $ | 20,619 | $ | (9,687 | ) | $ | 57,906 | $ | 170,161 | $ | 52,910 | $ | (37,949 | ) | $ | 185,122 | |||||||
Depreciation and amortization | 3,560 | 6,257 | 545 | 10,362 | 14,397 | 24,417 | 2,075 | 40,889 | |||||||||||||||||
EBITDA | $ | 50,534 | $ | 26,876 | $ | (9,142 | ) | 68,268 | $ | 184,558 | $ | 77,327 | $ | (35,874 | ) | 226,011 | |||||||||
Less: | |||||||||||||||||||||||||
Depreciation and amortization | (10,362 | ) | (40,889 | ) | |||||||||||||||||||||
Net interest expense | (3,821 | ) | (18,533 | ) | |||||||||||||||||||||
Income taxes | (20,238 | ) | (60,955 | ) | |||||||||||||||||||||
Earnings from continuing operations | $ | 33,847 | $ | 105,634 | |||||||||||||||||||||
Segment EBITDA margin | 17.6 | % | 34.9 | % | 16.8 | % | 27.4 | % | |||||||||||||||||
Table 6
Meredith Corporation and Subsidiaries
Supplemental Disclosures Regarding Non-GAAP Financial Measures
FREE CASH FLOW
Free cash flow, which is reconciled to operating cash flow in the following table, is defined as operating cash flow less capital expenditures.
Twelve Months Ended June 30, | 2011 | 2010 | |||||
(In thousands) | |||||||
Free cash flow | $ | 184,629 | $ | 166,930 | |||
Capital expenditures | 29,906 | 24,721 | |||||
Net cash provided by operating activities | $ | 214,535 | $ | 191,651 | |||
Table 7
Meredith Corporation and Subsidiaries
Consolidated Statement of Earnings (Unaudited)
Three Months Ended | Year Ended | ||||||||||||||||||
September 30, 2010 | December 31, 2010 | March 31, 2011 | June 30, 2011 | June 30, 2011 | |||||||||||||||
(In thousands except per share data) | |||||||||||||||||||
Revenues | |||||||||||||||||||
Advertising | $ | 204,825 | $ | 213,755 | $ | 185,210 | $ | 189,002 | $ | 792,792 | |||||||||
Circulation | 65,940 | 63,737 | 66,453 | 65,328 | 261,458 | ||||||||||||||
All other | 71,975 | 88,441 | 87,218 | 98,596 | 346,230 | ||||||||||||||
Total revenues | 342,740 | 365,933 | 338,881 | 352,926 | 1,400,480 | ||||||||||||||
Operating expenses | |||||||||||||||||||
Production, distribution, and editorial | 142,841 | 137,251 | 134,437 | 139,572 | 554,101 | ||||||||||||||
Selling, general, and administrative | 141,932 | 148,506 | 142,130 | 148,975 | 581,543 | ||||||||||||||
Depreciation and amortization | 9,785 | 9,663 | 9,965 | 10,132 | 39,545 | ||||||||||||||
Total operating expenses | 294,558 | 295,420 | 286,532 | 298,679 | 1,175,189 | ||||||||||||||
Earnings from operations | 48,182 | 70,513 | 52,349 | 54,247 | 225,291 | ||||||||||||||
Interest income | 11 | 11 | 6 | 3 | 31 | ||||||||||||||
Interest expense | (3,522 | ) | (3,362 | ) | (3,153 | ) | (2,932 | ) | (12,969 | ) | |||||||||
Earnings from continuing operations before income taxes | 44,671 | 67,162 | 49,202 | 51,318 | 212,353 | ||||||||||||||
Income taxes | (18,609 | ) | (26,065 | ) | (18,026 | ) | (18,043 | ) | (80,743 | ) | |||||||||
Earnings from continuing operations | 26,062 | 41,097 | 31,176 | 33,275 | 131,610 | ||||||||||||||
Loss from discontinued operations, net of taxes | (355 | ) | (540 | ) | (339 | ) | (2,944 | ) | (4,178 | ) | |||||||||
Net earnings | $ | 25,707 | $ | 40,557 | $ | 30,837 | $ | 30,331 | $ | 127,432 | |||||||||
Basic earnings per share | |||||||||||||||||||
Earnings from continuing operations | $ | 0.58 | $ | 0.90 | $ | 0.69 | $ | 0.73 | $ | 2.89 | |||||||||
Discontinued operations | (0.01 | ) | (0.01 | ) | (0.01 | ) | (0.06 | ) | (0.09 | ) | |||||||||
Basic earnings per share | $ | 0.57 | $ | 0.89 | $ | 0.68 | $ | 0.67 | $ | 2.80 | |||||||||
Basic average shares outstanding | 45,483 | 45,571 | 45,594 | 45,339 | 45,497 | ||||||||||||||
Diluted earnings per share | |||||||||||||||||||
Earnings from continuing operations | $ | 0.57 | $ | 0.90 | $ | 0.68 | $ | 0.73 | $ | 2.87 | |||||||||
Discontinued operations | (0.01 | ) | (0.01 | ) | (0.01 | ) | (0.07 | ) | (0.09 | ) | |||||||||
Diluted earnings per share | $ | 0.56 | $ | 0.89 | $ | 0.67 | $ | 0.66 | $ | 2.78 | |||||||||
Diluted average shares outstanding | 45,748 | 45,912 | 45,998 | 45,666 | 45,832 | ||||||||||||||
Table 8
Meredith Corporation and Subsidiaries
Segment Information (Unaudited)
Three Months Ended | Year Ended | ||||||||||||||||||
September 30, 2010 | December 31, 2010 | March 31, 2011 | June 30, 2011 | June 30, 2011 | |||||||||||||||
(In thousands) | |||||||||||||||||||
Revenues | |||||||||||||||||||
National media group | |||||||||||||||||||
Advertising | $ | 135,502 | $ | 122,352 | $ | 120,997 | $ | 122,531 | $ | 501,382 | |||||||||
Circulation | 65,940 | 63,737 | 66,453 | 65,328 | 261,458 | ||||||||||||||
Other revenues | 65,273 | 82,394 | 80,436 | 87,279 | 315,382 | ||||||||||||||
Total national media group | 266,715 | 268,483 | 267,886 | 275,138 | 1,078,222 | ||||||||||||||
Local media group | |||||||||||||||||||
Non-political advertising | 57,748 | 69,376 | 63,531 | 65,733 | 256,388 | ||||||||||||||
Political advertising | 11,575 | 22,027 | 682 | 738 | 35,022 | ||||||||||||||
Other revenues | 6,702 | 6,047 | 6,782 | 11,317 | 30,848 | ||||||||||||||
Total local media group | 76,025 | 97,450 | 70,995 | 77,788 | 322,258 | ||||||||||||||
Total revenues | $ | 342,740 | $ | 365,933 | $ | 338,881 | $ | 352,926 | $ | 1,400,480 | |||||||||
Operating profit | |||||||||||||||||||
National media group | $ | 39,630 | $ | 42,200 | $ | 48,467 | $ | 49,331 | $ | 179,628 | |||||||||
Local media group | 16,728 | 38,549 | 13,281 | 19,294 | 87,852 | ||||||||||||||
Unallocated corporate | (8,176 | ) | (10,236 | ) | (9,399 | ) | (14,378 | ) | (42,189 | ) | |||||||||
Income from operations | $ | 48,182 | $ | 70,513 | $ | 52,349 | $ | 54,247 | $ | 225,291 | |||||||||
Depreciation and amortization | |||||||||||||||||||
National media group | $ | 3,352 | $ | 3,337 | $ | 3,346 | $ | 3,481 | $ | 13,516 | |||||||||
Local media group | 5,928 | 5,816 | 6,109 | 6,150 | 24,003 | ||||||||||||||
Unallocated corporate | 505 | 510 | 510 | 501 | 2,026 | ||||||||||||||
Total depreciation and amortization | $ | 9,785 | $ | 9,663 | $ | 9,965 | $ | 10,132 | $ | 39,545 | |||||||||
EBITDA1 | |||||||||||||||||||
National media group | $ | 42,982 | $ | 45,537 | $ | 51,813 | $ | 52,812 | $ | 193,144 | |||||||||
Local media group | 22,656 | 44,365 | 19,390 | 25,444 | 111,855 | ||||||||||||||
Unallocated corporate | (7,671 | ) | (9,726 | ) | (8,889 | ) | (13,877 | ) | (40,163 | ) | |||||||||
Total EBITDA1 | $ | 57,967 | $ | 80,176 | $ | 62,314 | $ | 64,379 | $ | 264,836 | |||||||||
1 EBITDA is earnings from continuing operations before interest, taxes, depreciation, and amortization. | |||||||||||||||||||
Table 9
Meredith Corporation and Subsidiaries
Consolidated Statement of Earnings (Unaudited)
Three Months Ended | Year Ended | |||||||||||||||||||
September 30, 2009 | December 31, 2009 | March 31, 2010 | June 30, 2010 | June 30, 2010 | ||||||||||||||||
(In thousands except per share data) | ||||||||||||||||||||
Revenues | ||||||||||||||||||||
Advertising | $ | 191,253 | $ | 187,570 | $ | 198,560 | $ | 201,976 | $ | 779,359 | ||||||||||
Circulation | 68,971 | 66,747 | 73,670 | 70,248 | 279,636 | |||||||||||||||
All other | 70,711 | 81,721 | 79,569 | 91,835 | 323,836 | |||||||||||||||
Total revenues | 330,935 | 336,038 | 351,799 | 364,059 | 1,382,831 | |||||||||||||||
Operating expenses | ||||||||||||||||||||
Production, distribution, and editorial | 150,304 | 142,392 | 143,807 | 135,789 | 572,292 | |||||||||||||||
Selling, general, and administrative | 138,447 | 145,746 | 140,333 | 160,002 | 584,528 | |||||||||||||||
Depreciation and amortization | 10,101 | 10,115 | 10,311 | 10,362 | 40,889 | |||||||||||||||
Total operating expenses | 298,852 | 298,253 | 294,451 | 306,153 | 1,197,709 | |||||||||||||||
Earnings from operations | 32,083 | 37,785 | 57,348 | 57,906 | 185,122 | |||||||||||||||
Interest income | 10 | 9 | 6 | 26 | 51 | |||||||||||||||
Interest expense | (5,041 | ) | (5,744 | ) | (3,952 | ) | (3,847 | ) | (18,584 | ) | ||||||||||
Earnings from continuing operations before income taxes | 27,052 | 32,050 | 53,402 | 54,085 | 166,589 | |||||||||||||||
Income taxes | (8,405 | ) | (12,745 | ) | (19,567 | ) | (20,238 | ) | (60,955 | ) | ||||||||||
Earnings from continuing operations | 18,647 | 19,305 | 33,835 | 33,847 | 105,634 | |||||||||||||||
Loss from discontinued operations, net of taxes | (306 | ) | (351 | ) | (536 | ) | (478 | ) | (1,671 | ) | ||||||||||
Net earnings | $ | 18,341 | $ | 18,954 | $ | 33,299 | $ | 33,369 | $ | 103,963 | ||||||||||
Basic earnings per share | ||||||||||||||||||||
Earnings from continuing operations | $ | 0.42 | $ | 0.43 | $ | 0.74 | $ | 0.75 | $ | 2.34 | ||||||||||
Discontinued operations | (0.01 | ) | (0.01 | ) | (0.01 | ) | (0.01 | ) | (0.04 | ) | ||||||||||
Basic earnings per share | $ | 0.41 | $ | 0.42 | $ | 0.73 | $ | 0.74 | $ | 2.30 | ||||||||||
Basic average shares outstanding | 45,158 | 45,288 | 45,331 | 45,381 | 45,289 | |||||||||||||||
Diluted earnings per share | ||||||||||||||||||||
Earnings from continuing operations | $ | 0.41 | $ | 0.43 | $ | 0.74 | $ | 0.74 | $ | 2.32 | ||||||||||
Discontinued operations | (0.01 | ) | (0.01 | ) | (0.01 | ) | (0.01 | ) | (0.04 | ) | ||||||||||
Diluted earnings per share | $ | 0.40 | $ | 0.42 | $ | 0.73 | $ | 0.73 | $ | 2.28 | ||||||||||
Diluted average shares outstanding | 45,317 | 45,547 | 45,651 | 45,774 | 45,544 | |||||||||||||||
Table 10
Meredith Corporation and Subsidiaries
Segment Information (Unaudited)
Three Months Ended | Year Ended | |||||||||||||||||||
September 30, 2009 | December 31, 2009 | March 31, 2010 | June 30, 2010 | June 30, 2010 | ||||||||||||||||
(In thousands) | ||||||||||||||||||||
Revenues | ||||||||||||||||||||
National media group | ||||||||||||||||||||
Advertising | $ | 136,639 | $ | 117,133 | $ | 136,727 | $ | 134,114 | $ | 524,613 | ||||||||||
Circulation | 68,971 | 66,747 | 73,670 | 70,248 | 279,636 | |||||||||||||||
Other revenues | 64,514 | 76,478 | 72,644 | 82,584 | 296,220 | |||||||||||||||
Total national media group | 270,124 | 260,358 | 283,041 | 286,946 | 1,100,469 | |||||||||||||||
Local media group | ||||||||||||||||||||
Non-political advertising | 53,671 | 67,549 | 60,312 | 63,969 | 245,501 | |||||||||||||||
Political advertising | 943 | 2,888 | 1,521 | 3,893 | 9,245 | |||||||||||||||
Other revenues | 6,197 | 5,243 | 6,925 | 9,251 | 27,616 | |||||||||||||||
Total local media group | 60,811 | 75,680 | 68,758 | 77,113 | 282,362 | |||||||||||||||
Total revenues | $ | 330,935 | $ | 336,038 | $ | 351,799 | $ | 364,059 | $ | 1,382,831 | ||||||||||
Operating profit | ||||||||||||||||||||
National media group | $ | 39,094 | $ | 32,349 | $ | 51,744 | $ | 46,974 | $ | 170,161 | ||||||||||
Local media group | 2,400 | 17,063 | 12,828 | 20,619 | 52,910 | |||||||||||||||
Unallocated corporate | (9,411 | ) | (11,627 | ) | (7,224 | ) | (9,687 | ) | (37,949 | ) | ||||||||||
Income from operations | $ | 32,083 | $ | 37,785 | $ | 57,348 | $ | 57,906 | $ | 185,122 | ||||||||||
Depreciation and amortization | ||||||||||||||||||||
National media group | $ | 3,505 | $ | 3,640 | $ | 3,692 | $ | 3,560 | $ | 14,397 | ||||||||||
Local media group | 6,122 | 5,960 | 6,078 | 6,257 | 24,417 | |||||||||||||||
Unallocated corporate | 474 | 515 | 541 | 545 | 2,075 | |||||||||||||||
Total depreciation and amortization | $ | 10,101 | $ | 10,115 | $ | 10,311 | $ | 10,362 | $ | 40,889 | ||||||||||
EBITDA1 | ||||||||||||||||||||
National media group | $ | 42,599 | $ | 35,989 | $ | 55,436 | $ | 50,534 | $ | 184,558 | ||||||||||
Local media group | 8,522 | 23,023 | 18,906 | 26,876 | 77,327 | |||||||||||||||
Unallocated corporate | (8,937 | ) | (11,112 | ) | (6,683 | ) | (9,142 | ) | (35,874 | ) | ||||||||||
Total EBITDA1 | $ | 42,184 | $ | 47,900 | $ | 67,659 | $ | 68,268 | $ | 226,011 | ||||||||||
1 EBITDA is earnings from continuing operations before interest, taxes, depreciation, and amortization. | ||||||||||||||||||||