News Releases
DES MOINES, Iowa, April 28 /PRNewswire-FirstCall/ -- Meredith Corporation (NYSE: MDP), the leading media and marketing company serving American women, today reported fiscal 2010 third quarter earnings per share grew more than 30 percent to $0.73 from $0.56 in the prior year. Total revenues increased 5 percent to $353 million.
Fiscal 2010 third quarter earnings included a net benefit of $0.04 per share from special items, primarily the resolution of an income tax contingency. Excluding these special items, earnings per share from continuing operations increased 25 percent to $0.69.
"We're pleased to deliver revenue and operating profit growth across all of our major businesses, particularly in an increasingly competitive marketplace," said Meredith Chairman and Chief Executive Officer Stephen M. Lacy. "Additionally, we continued to increase our connection to the American consumer across a variety of platforms."
Highlights from Meredith's fiscal 2010 third quarter included:
- Advertising revenue growth in the National and Local Media groups. Both groups outperformed their respective industries and continued to gain advertising market share.
- Double-digit revenue increases in non-advertising based activities including integrated marketing, brand licensing, retransmission fees and video content creation.
- Further debt reduction of $35 million, bringing fiscal 2010 year-to-date debt reduction to $65 million.
"While our advertising growth was encouraging, we are still well below historic levels established prior to the recession in both our national and local businesses," Lacy said. "The marketplace remains very volatile on both a month-to-month and client-by-client basis. Our competitive advantage lies in the strength of our brands and the relevance of our content."
For the first nine months of fiscal 2010, earnings per share increased 24 percent to $1.55 from $1.25 in the prior year. Excluding special items in both periods (see Tables 1-4), earnings per share increased to $1.52 from $1.46. Revenues were $1.02 billion, compared to $1.06 billion. Meredith recorded $18 million less ($0.24 per share) in net political advertising in the first nine months of fiscal 2010 (a non-political year). Total company operating expenses declined 5 percent.
OPERATING DETAIL
National Media Group
Fiscal 2010 third quarter National Media Group operating profit increased 6 percent to $51 million from $48 million in the prior year. Revenues increased 2 percent to $285 million from $280 million.
Looking at third-quarter advertising performance:
- Total advertising revenues grew 4 percent to $137 million led by Meredith's largest titles Better Homes and Gardens, Family Circle and Parents.
- Share of overall magazine industry advertising revenues reached 12.4 percent, up from 11.2 percent in the prior year, according to the latest data from the Publishers Information Bureau. Additionally, Meredith's market share as measured against its 28-title competitive set increased to 40.6 percent, up from 39.2 percent.
- Online advertising revenues at Meredith Interactive rose more than 20 percent.
Meredith's consumer connection strengthened during the quarter, based on several key measurements. Circulation revenues rose more than 2 percent, due to an increase in newsstand sales. Monthly average unique visitors across Meredith's National Media Group Web sites rose more than 30 percent to 20 million, and monthly page views averaged more than 230 million.
Meredith Integrated Marketing revenues increased 10 percent in the quarter, led by growth in digital initiatives on behalf of existing and new clients, particularly in the pharmaceutical industry. Brand Licensing revenues grew nearly 50 percent, due primarily to an increase in sales of Better Homes and Gardens' branded products at Walmart stores.
"Along with advertising growth in our core magazine business, we are pleased that our highly sought-after digital marketing capabilities are deepening existing client relationships and winning new business," Lacy said.
For the first nine months of fiscal 2010, operating profit increased 15 percent to $121 million from $105 million in the prior year. Total revenues were $817 million, compared to $851 million, and advertising revenues were $392 million, down slightly from the prior year. Operating expenses decreased 7 percent.
Local Media Group
Fiscal 2010 third quarter Local Media Group operating profit was $13 million, up significantly from $1 million in the prior year. Revenues increased 20 percent to $69 million from $57 million.
Looking at third-quarter advertising performance:
- Non-political advertising revenues grew 16 percent, led by improved performance in the automotive, professional services and retail categories.
- Meredith stations in all 10 of its television markets delivered growth, led by strong performances in Atlanta, Phoenix and Hartford.
- Meredith outperformed the industry according to the most recent data available from the Television Bureau of Advertising.
Several Meredith television stations delivered improved ratings during the February sweeps. Atlanta doubled morning news ratings, while Hartford and Greenville posted double-digit ratings gains. In evening news, Hartford, Kansas City, Greenville and Las Vegas all grew ratings.
Revenues from retransmission fees rose nearly 15 percent in the third quarter. Revenues also grew at Meredith Video Studios, driven primarily by custom video projects for corporate clients. Also, the daily Better television show will increase its carriage to more than 60 markets reaching nearly 50 percent of U.S. television households.
"Our Local Media business delivered significantly improved results across the board, a reflection of improving market conditions and success at executing our performance improvement initiatives," Lacy said. "Additionally, it speaks to broadcast television's unparalleled ability to deliver advertising messages to mass audiences in local markets."
For the first nine months of fiscal 2010, operating profit was $32 million, compared to $34 million in the prior year, primarily due to $18 million less in net political advertising revenues. Total revenues were $205 million, compared to $212 million. Non-political advertising revenues increased 2 percent to $182 million from $178 million. Operating expenses declined 3 percent.
OTHER FINANCIAL INFORMATION
Meredith generated $140 million in cash flow from operations during the first nine months of fiscal 2010. Meredith's total debt was $315 million at March 31, 2010, $65 million less than at the prior fiscal year end. Meredith's debt-to-EBITDA ratio was well under existing debt covenants at 1.4 to 1.
Total company operating expenses in the third quarter of fiscal 2010 were up slightly. This was primarily due to a client bankruptcy; our investment in Next Issue Media, the e-Reader consortium; and severance costs related to an organizational realignment. Total company operating expenses declined 5 percent for the first nine months of fiscal 2010.
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.
OUTLOOK
Looking at the fourth quarter of fiscal 2010, total Company advertising revenue is expected to increase 7 to 8 percent over the prior year. This includes:
- Local Media Group non-political advertising revenue, which is currently pacing up in the high teens, and;
- National Media Group advertising revenue, which with two of three magazine issues closed, is expected to be flat to up slightly.
Meredith currently expects fiscal 2010 fourth quarter earnings per share to range from $0.61 to $0.66, and full year fiscal 2010 earnings per share are expected to range from $2.13 to $2.18, excluding special items.
A number of uncertainties remain that may affect Meredith's outlook as stated in this press release for the fourth fiscal quarter and full year of 2010. These uncertainties are referenced below under "Safe Harbor" and in certain SEC filings.
CONFERENCE CALL WEBCAST
Meredith will host a conference call on April 28, 2010, at 11:00 a.m. EDT to discuss fiscal 2010 third quarter results. A live webcast will be accessible to the public on the company's Web site, www.meredith.com, and a replay will be available for one week. A transcript will be available within 48 hours after the call at www.meredith.com.
RATIONALE FOR USE AND ACCESS TO NON-GAAP MEASURES
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 is a common supplemental measure of performance used by investors and financial analysts. Management believes that EBITDA provides an additional analytical tool to clarify the company's results from core operations and delineate underlying trends. Meredith does not use EBITDA as a measure of liquidity or funds available for management's discretionary use because it includes certain contractual and non-discretionary expenditures.
Results excluding the special items recorded in fiscal 2010 and 2009 are also supplemental non-GAAP financial measures. Management believes these items are not reflective of Meredith's ongoing business activities. While results excluding the special items are not a substitute for reported earnings 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 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 broadcasting pacings and publishing advertising revenues, along with the company's earnings per share outlook for the fourth fiscal quarter and full year fiscal 2010.
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 or syndicated programming 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 combines well-known national brands – including Better Homes and Gardens, Parents, Ladies' Home Journal, Family Circle, American Baby, Fitness and More – 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 and video – to give consumers content they desire and to deliver the messages of its marketing partners. 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 capabilities in this area through the acquisition of cutting-edge companies in areas such as online, word-of-mouth and database marketing.
Meredith Corporation and Subsidiaries | ||||||||
Condensed Consolidated Statements of Earnings (Unaudited) | ||||||||
Three Months | Nine Months | |||||||
Period Ended March 31, | 2010 | 2009 | 2010 | 2009 | ||||
(In thousands except per share data) | ||||||||
Revenues | ||||||||
Advertising | $ 199,170 | $ 184,265 | $ 578,854 | $ 597,891 | ||||
Circulation | 74,598 | 72,869 | 211,686 | 211,086 | ||||
All other | 79,575 | 80,460 | 232,073 | 253,971 | ||||
Total revenues | 353,343 | 337,594 | 1,022,613 | 1,062,948 | ||||
Operating expenses | ||||||||
Production, distribution, and editorial | 144,517 | 159,197 | 438,521 | 491,618 | ||||
Selling, general, and administrative | 142,044 | 124,323 | 428,298 | 421,523 | ||||
Depreciation and amortization | 10,313 | 10,714 | 30,533 | 32,346 | ||||
Total operating expenses | 296,874 | 294,234 | 897,352 | 945,487 | ||||
Income from operations | 56,469 | 43,360 | 125,261 | 117,461 | ||||
Interest income | 6 | 121 | 25 | 348 | ||||
Interest expense | (3,952) | (4,911) | (14,737) | (15,698) | ||||
Earnings from continuing operations before income taxes | 52,523 | 38,570 | 110,549 | 102,111 | ||||
Income taxes | 19,224 | 13,696 | 39,955 | 40,766 | ||||
Earnings from continuing operations | 33,299 | 24,874 | 70,594 | 61,345 | ||||
Earning (loss) from discontinued operations, net of taxes | - | 554 | - | (4,737) | ||||
Net earnings | $ 33,299 | $ 25,428 | $ 70,594 | $ 56,608 | ||||
Basic earnings per share | ||||||||
Earnings from continuing operations | $ 0.73 | $ 0.55 | $ 1.56 | $ 1.36 | ||||
Discontinued operations | - | 0.01 | - | (0.11) | ||||
Basic earnings per share | $ 0.73 | $ 0.56 | $ 1.56 | $ 1.25 | ||||
Basic average shares outstanding | 45,331 | 44,961 | 45,259 | 45,051 | ||||
Diluted earnings per share | ||||||||
Earnings from continuing operations | $ 0.73 | $ 0.55 | $ 1.55 | $ 1.36 | ||||
Discontinued operations | - | 0.01 | - | (0.11) | ||||
Diluted earnings per share | $ 0.73 | $ 0.56 | $ 1.55 | $ 1.25 | ||||
Diluted average shares outstanding | 45,651 | 45,092 | 45,505 | 45,177 | ||||
Dividends paid per share | $ 0.230 | $ 0.225 | $ 0.680 | $ 0.655 | ||||
Meredith Corporation and Subsidiaries | |||||||||
Segment Information (Unaudited) | |||||||||
Three Months | Nine Months | ||||||||
Period Ended March 31, | 2010 | 2009 | 2010 | 2009 | |||||
(In thousands) | |||||||||
Revenues | |||||||||
National media group | |||||||||
Advertising | $ 137,337 | $ 132,242 | $ 391,970 | $ 396,627 | |||||
Circulation | 74,598 | 72,869 | 211,686 | 211,086 | |||||
Other revenues | 72,650 | 75,209 | 213,708 | 243,182 | |||||
Total national media group | 284,585 | 280,320 | 817,364 | 850,895 | |||||
Local media group | |||||||||
Non-political advertising | 60,312 | 51,778 | 181,532 | 178,143 | |||||
Political advertising | 1,521 | 245 | 5,352 | 23,121 | |||||
Other revenues | 6,925 | 5,251 | 18,365 | 10,789 | |||||
Total local media group | 68,758 | 57,274 | 205,249 | 212,053 | |||||
Total revenues | $ 353,343 | $ 337,594 | $ 1,022,613 | $ 1,062,948 | |||||
Operating profit | |||||||||
National media group | $ 50,865 | $ 47,971 | $ 121,232 | $ 105,069 | |||||
Local media group | 12,828 | 1,348 | 32,291 | 34,373 | |||||
Unallocated corporate | (7,224) | (5,959) | (28,262) | (21,981) | |||||
Income from operations | $ 56,469 | $ 43,360 | $ 125,261 | $ 117,461 | |||||
Depreciation and amortization | |||||||||
National media group | $ 3,694 | $ 3,789 | $ 10,843 | $ 11,843 | |||||
Local media group | 6,078 | 6,471 | 18,160 | 18,988 | |||||
Unallocated corporate | 541 | 454 | 1,530 | 1,515 | |||||
Total depreciation and amortization | $ 10,313 | $ 10,714 | $ 30,533 | $ 32,346 | |||||
EBITDA(1) | |||||||||
National media group | $ 54,559 | $ 51,760 | $ 132,075 | $ 116,912 | |||||
Local media group | 18,906 | 7,819 | 50,451 | 53,361 | |||||
Unallocated corporate | (6,683) | (5,505) | (26,732) | (20,466) | |||||
Total EBITDA | $ 66,782 | $ 54,074 | $ 155,794 | $ 149,807 | |||||
1 EBITDA is earnings from continuing operations before interest, taxes, depreciation, and amortization. | |||||||||
Meredith Corporation and Subsidiaries | ||||
Condensed Consolidated Balance Sheets (Unaudited) | ||||
March 31, | June 30, | |||
Assets | 2010 | 2009 | ||
(In thousands) | ||||
Current assets | ||||
Cash and cash equivalents | $ 23,666 | $ 27,910 | ||
Accounts receivable, net | 229,209 | 192,367 | ||
Inventories | 24,874 | 28,151 | ||
Current portion of subscription acquisition costs | 59,541 | 60,017 | ||
Current portion of broadcast rights | 9,767 | 8,297 | ||
Other current assets | 15,996 | 23,398 | ||
Total current assets | 363,053 | 340,140 | ||
Property, plant, and equipment | 453,674 | 444,904 | ||
Less accumulated depreciation | (265,074) | (253,597) | ||
Net property, plant, and equipment | 188,600 | 191,307 | ||
Subscription acquisition costs | 58,062 | 63,444 | ||
Broadcast rights | 3,440 | 4,545 | ||
Other assets | 53,247 | 45,907 | ||
Intangible assets, net | 554,551 | 561,581 | ||
Goodwill | 484,919 | 462,379 | ||
Total assets | $ 1,705,872 | $ 1,669,303 | ||
Liabilities and Shareholders' Equity | ||||
Current liabilities | ||||
Current portion of long-term debt | $ 140,000 | $ - | ||
Current portion of long-term broadcast rights payable | 13,580 | 10,560 | ||
Accounts payable | 83,927 | 86,381 | ||
Accrued expenses and other liabilities | 122,759 | 81,544 | ||
Current portion of unearned subscription revenues | 167,858 | 170,731 | ||
Total current liabilities | 528,124 | 349,216 | ||
Long-term debt | 175,000 | 380,000 | ||
Long-term broadcast rights payable | 9,979 | 11,851 | ||
Unearned subscription revenues | 138,396 | 148,393 | ||
Deferred income taxes | 89,027 | 64,322 | ||
Other noncurrent liabilities | 105,437 | 106,138 | ||
Total liabilities | 1,045,963 | 1,059,920 | ||
Shareholders' equity | ||||
Common stock | 36,280 | 35,934 | ||
Class B stock | 9,092 | 9,133 | ||
Additional paid-in capital | 63,193 | 53,938 | ||
Retained earnings | 581,719 | 542,006 | ||
Accumulated other comprehensive loss | (30,375) | (31,628) | ||
Total shareholders' equity | 659,909 | 609,383 | ||
Total liabilities and shareholders' equity | $ 1,705,872 | $ 1,669,303 | ||
Meredith Corporation and Subsidiaries | ||||
Condensed Consolidated Statements of Cash Flows (Unaudited) | ||||
Nine Months Ended March 31, | 2010 | 2009 | ||
(In thousands) | ||||
Net cash provided by operating activities | $ 139,903 | $ 138,611 | ||
Cash flows from investing activities | ||||
Acquisitions of businesses | (32,542) | (6,118) | ||
Additions to property, plant, and equipment | (18,249) | (18,642) | ||
Proceeds from dispositions of assets | - | 636 | ||
Net cash used in investing activities | (50,791) | (24,124) | ||
Cash flows from financing activities | ||||
Proceeds from issuance of long-term debt | 85,000 | 120,000 | ||
Repayments of long-term debt | (150,000) | (150,000) | ||
Purchases of Company stock | (5,228) | (21,763) | ||
Dividends paid | (30,881) | (29,573) | ||
Proceeds from common stock issued | 7,459 | 3,178 | ||
Excess tax benefits from share-based payments | 489 | 673 | ||
Other | (195) | (250) | ||
Net cash used in financing activities | (93,356) | (77,735) | ||
Net increase (decrease) in cash and cash equivalents | (4,244) | 36,752 | ||
Cash and cash equivalents at beginning of period | 27,910 | 37,644 | ||
Cash and cash equivalents at end of period | $ 23,666 | $ 74,396 | ||
Meredith Corporation and Subsidiaries | Table 1 | |||||||||||
Supplemental Disclosures Regarding Non-GAAP Financial Measures | ||||||||||||
The following table shows results of operations excluding the special items and as reported. Results of operations excluding the 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 March 31, 2010 | Three Months | Nine Months | ||||||||||
Excluding Special Items | Special Items | As Reported | Excluding Special Items | Special Items | As Reported | |||||||
(In thousands except per share data) | ||||||||||||
Revenues | ||||||||||||
Advertising | $ 199,170 | $ - | $ 199,170 | $ 578,854 | $ - | $ 578,854 | ||||||
Circulation | 74,598 | - | 74,598 | 211,686 | - | 211,686 | ||||||
All other | 79,575 | - | 79,575 | 232,073 | - | 232,073 | ||||||
Total revenues | 353,343 | - | 353,343 | 1,022,613 | - | 1,022,613 | ||||||
Operating expenses | ||||||||||||
Production, distribution, and editorial | 144,517 | - | 144,517 | 437,074 | 1,447 | (a) | 438,521 | |||||
Selling, general, and administrative | 141,682 | 362 | (b) | 142,044 | 423,913 | 4,385 | (c) | 428,298 | ||||
Depreciation and amortization | 10,313 | - | 10,313 | 30,533 | - | 30,533 | ||||||
Total operating expenses | 296,512 | 362 | 296,874 | 891,520 | 5,832 | 897,352 | ||||||
Income from operations | 56,831 | (362) | 56,469 | 131,093 | (5,832) | 125,261 | ||||||
Interest income | 6 | - | 6 | 25 | - | 25 | ||||||
Interest expense | (3,952) | - | (3,952) | (14,737) | - | (14,737) | ||||||
Earnings before income taxes | 52,885 | (362) | 52,523 | 116,381 | (5,832) | 110,549 | ||||||
Income taxes | 21,310 | (2,086) | (d) | 19,224 | 47,123 | (7,168) | (d) | 39,955 | ||||
Net earnings | $ 31,575 | $ 1,724 | $ 33,299 | $ 69,258 | $ 1,336 | $ 70,594 | ||||||
Basic earnings per share | $ 0.70 | $ 0.03 | $ 0.73 | $ 1.53 | $ 0.03 | $ 1.56 | ||||||
Basic average shares outstanding | 45,331 | 45,331 | 45,331 | 45,259 | 45,259 | 45,259 | ||||||
Diluted earnings per share | $ 0.69 | $ 0.04 | $ 0.73 | $ 1.52 | $ 0.03 | $ 1.55 | ||||||
Diluted average shares outstanding | 45,651 | 45,651 | 45,651 | 45,505 | 45,505 | 45,505 | ||||||
(a) Write-off of art and manuscript inventory resulting from the repositioning of certain national media group operations | ||||||||||||
(b) Severance costs resulting from the repositioning of certain national media group operations, net of adjustments to the restructuring accrual | ||||||||||||
(c) Severance costs and write-off of subscription acquisition costs resulting from the repositioning of certain national media group operations, net of adjustments to the restructuring accrual | ||||||||||||
(d) Tax benefit as a result of state and local legislation during the first fiscal quarter, the resolution of a tax contingency in the third fiscal quarter, and net repositioning charges | ||||||||||||
Meredith Corporation and Subsidiaries | Table 2 | |||||||||||
Supplemental Disclosures Regarding Non-GAAP Financial Measures | ||||||||||||
The following table shows results of operations excluding the special items and as reported. Results of operations excluding the 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 March 31, 2010 | Three Months | Nine Months | ||||||||||
Excluding Special Items | Special Items | As Reported | Excluding Special Items | Special Items | As Reported | |||||||
(In thousands) | ||||||||||||
Revenues | ||||||||||||
National media group | ||||||||||||
Advertising | $ 137,337 | $ - | $ 137,337 | $ 391,970 | $ - | $ 391,970 | ||||||
Circulation | 74,598 | - | 74,598 | 211,686 | - | 211,686 | ||||||
Other revenues | 72,650 | - | 72,650 | 213,708 | - | 213,708 | ||||||
Total national media group | 284,585 | - | 284,585 | 817,364 | - | 817,364 | ||||||
Local media group | ||||||||||||
Non-political advertising | 60,312 | - | 60,312 | 181,532 | - | 181,532 | ||||||
Political advertising | 1,521 | - | 1,521 | 5,352 | - | 5,352 | ||||||
Other revenues | 6,925 | - | 6,925 | 18,365 | - | 18,365 | ||||||
Total local media group | 68,758 | - | 68,758 | 205,249 | - | 205,249 | ||||||
Total revenues | $ 353,343 | $ - | $ 353,343 | $ 1,022,613 | $ - | $ 1,022,613 | ||||||
Operating profit | ||||||||||||
National media group | $ 51,227 | $ (362) | (a) | $ 50,865 | $ 127,064 | $ (5,832) | (b) | $ 121,232 | ||||
Local media group | 12,828 | - | 12,828 | 32,291 | - | 32,291 | ||||||
Unallocated corporate | (7,224) | - | (7,224) | (28,262) | - | (28,262) | ||||||
Income from operations | $ 56,831 | $ (362) | $ 56,469 | $ 131,093 | $ (5,832) | $ 125,261 | ||||||
Depreciation and amortization | ||||||||||||
National media group | $ 3,694 | $ - | $ 3,694 | $ 10,843 | $ - | $ 10,843 | ||||||
Local media group | 6,078 | - | 6,078 | 18,160 | - | 18,160 | ||||||
Unallocated corporate | 541 | - | 541 | 1,530 | - | 1,530 | ||||||
Total depreciation and amortization | $ 10,313 | $ - | $ 10,313 | $ 30,533 | $ - | $ 30,533 | ||||||
EBITDA(1) | ||||||||||||
National media group | $ 54,921 | $ (362) | (a) | $ 54,559 | $ 137,907 | $ (5,832) | (b) | $ 132,075 | ||||
Local media group | 18,906 | - | 18,906 | 50,451 | - | 50,451 | ||||||
Unallocated corporate | (6,683) | - | (6,683) | (26,732) | - | (26,732) | ||||||
Total EBITDA(1) | $ 67,144 | $ (362) | $ 66,782 | $ 161,626 | $ (5,832) | $ 155,794 | ||||||
1 EBITDA is earnings (loss) from continuing operations before interest, taxes, depreciation, and amortization. | ||||||||||||
(a) Severance costs resulting from the repositioning of certain operations, net of adjustments to the restructuring accrual | ||||||||||||
(b) Severance costs and the write-off of art and manuscript inventory and subscription acquisition costs resulting from the repositioning of certain operations, net of adjustments to the restructuring accrual | ||||||||||||
Meredith Corporation and Subsidiaries | Table 3 | |||||||||||
Supplemental Disclosures Regarding Non-GAAP Financial Measures | ||||||||||||
The following table shows results of operations excluding the special items and as reported. Results of operations excluding the 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 March 31, 2009 | Three Months | Nine Months | ||||||||||
Excluding Special Items | Special Items | As Reported | Excluding Special Items | Special Items | As Reported | |||||||
(In thousands except per share data) | ||||||||||||
Revenues | ||||||||||||
Advertising | $ 184,265 | $ - | $ 184,265 | $ 597,891 | $ - | $ 597,891 | ||||||
Circulation | 72,869 | - | 72,869 | 211,086 | - | 211,086 | ||||||
All other | 80,460 | - | 80,460 | 253,971 | - | 253,971 | ||||||
Total revenues | 337,594 | - | 337,594 | 1,062,948 | - | 1,062,948 | ||||||
Operating expenses | ||||||||||||
Production, distribution, and editorial | 159,197 | - | 159,197 | 491,618 | - | 491,618 | ||||||
Selling, general, and administrative | 124,323 | - | 124,323 | 412,490 | 9,033 | (a) | 421,523 | |||||
Depreciation and amortization | 10,714 | - | 10,714 | 32,346 | - | 32,346 | ||||||
Total operating expenses | 294,234 | - | 294,234 | 936,454 | 9,033 | 945,487 | ||||||
Income from operations | 43,360 | - | 43,360 | 126,494 | (9,033) | 117,461 | ||||||
Interest income | 121 | - | 121 | 348 | - | 348 | ||||||
Interest expense | (4,911) | - | (4,911) | (15,698) | - | (15,698) | ||||||
Earnings before income taxes | 38,570 | - | 38,570 | 111,144 | (9,033) | 102,111 | ||||||
Income taxes | 13,696 | - | 13,696 | 44,288 | (3,522) | 40,766 | ||||||
Earnings from continuing operations | 24,874 | - | 24,874 | 66,856 | (5,511) | 61,345 | ||||||
Earnings (loss) from discontinued operations, net of taxes | 554 | - | 554 | (613) | (4,124) | (b) | (4,737) | |||||
Net earnings | $ 25,428 | $ - | $ 25,428 | $ 66,243 | $ (9,635) | $ 56,608 | ||||||
Basic earnings per share | ||||||||||||
Earnings from continuing operations | $ 0.55 | $ - | $ 0.55 | $ 1.48 | $ (0.12) | $ 1.36 | ||||||
Discontinued operations | 0.01 | - | 0.01 | (0.02) | (0.09) | (0.11) | ||||||
Basic earnings per share | $ 0.56 | $ - | $ 0.56 | $ 1.46 | $ (0.21) | $ 1.25 | ||||||
Basic average shares outstanding | 44,961 | 44,961 | 44,961 | 45,051 | 45,051 | 45,051 | ||||||
Diluted earnings per share | ||||||||||||
Earnings from continuing operations | $ 0.55 | $ - | $ 0.55 | $ 1.48 | $ (0.12) | $ 1.36 | ||||||
Discontinued operations | 0.01 | - | 0.01 | (0.02) | (0.09) | (0.11) | ||||||
Diluted earnings per share | $ 0.56 | $ - | $ 0.56 | $ 1.46 | $ (0.21) | $ 1.25 | ||||||
Diluted average shares outstanding | 45,092 | 45,092 | 45,092 | 45,177 | 45,177 | 45,177 | ||||||
(a) Severance expense | ||||||||||||
(b) Severance expense and the write-down of art and manuscript inventory and subscription acquisition costs, net of taxes | ||||||||||||
Meredith Corporation and Subsidiaries | Table 4 | |||||||||||
Supplemental Disclosures Regarding Non-GAAP Financial Measures | ||||||||||||
The following table shows results of operations excluding the special items and as reported. Results of operations excluding the 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 March 31, 2009 | Three Months | Nine Months | ||||||||||
Excluding Special Items | Special Items | As Reported | Excluding Special Items | Special Items | As Reported | |||||||
(In thousands) | ||||||||||||
Revenues | ||||||||||||
National media group | ||||||||||||
Advertising | $ 132,242 | $ - | $ 132,242 | $ 396,627 | $ - | $ 396,627 | ||||||
Circulation | 72,869 | - | 72,869 | 211,086 | - | 211,086 | ||||||
Other revenues | 75,209 | - | 75,209 | 243,182 | - | 243,182 | ||||||
Total national media group | 280,320 | - | 280,320 | 850,895 | - | 850,895 | ||||||
Local media group | ||||||||||||
Non-political advertising | 51,778 | - | 51,778 | 178,143 | - | 178,143 | ||||||
Political advertising | 245 | - | 245 | 23,121 | - | 23,121 | ||||||
Other revenues | 5,251 | - | 5,251 | 10,789 | - | 10,789 | ||||||
Total local media group | 57,274 | - | 57,274 | 212,053 | - | 212,053 | ||||||
Total revenues | $ 337,594 | $ - | $ 337,594 | $ 1,062,948 | $ - | $ 1,062,948 | ||||||
Operating profit | ||||||||||||
National media group | $ 47,971 | $ - | $ 47,971 | $ 111,109 | $ (6,040) | (a) | $ 105,069 | |||||
Local media group | 1,348 | - | 1,348 | 36,386 | (2,013) | (b) | 34,373 | |||||
Unallocated corporate | (5,959) | - | (5,959) | (21,001) | (980) | (c) | (21,981) | |||||
Income from operations | $ 43,360 | $ - | $ 43,360 | $ 126,494 | $ (9,033) | $ 117,461 | ||||||
Depreciation and amortization | ||||||||||||
National media group | $ 3,789 | $ - | $ 3,789 | $ 11,843 | $ - | $ 11,843 | ||||||
Local media group | 6,471 | - | 6,471 | 18,988 | - | 18,988 | ||||||
Unallocated corporate | 454 | - | 454 | 1,515 | - | 1,515 | ||||||
Total depreciation and amortization | $ 10,714 | $ - | $ 10,714 | $ 32,346 | $ - | $ 32,346 | ||||||
EBITDA(1) | ||||||||||||
National media group | $ 51,760 | $ - | $ 51,760 | $ 122,952 | $ (6,040) | (a) | $ 116,912 | |||||
Local media group | 7,819 | - | 7,819 | 55,374 | (2,013) | (b) | 53,361 | |||||
Unallocated corporate | (5,505) | - | (5,505) | (19,486) | (980) | (c) | (20,466) | |||||
Total EBITDA(1) | $ 54,074 | $ - | $ 54,074 | $ 158,840 | $ (9,033) | $ 149,807 | ||||||
1 EBITDA is earnings from continuing operations before interest, taxes, depreciation, and amortization. | ||||||||||||
(a) Severance expense for national media group | ||||||||||||
(b) Severance expense for local media group | ||||||||||||
(c) Severance expense for corporate personnel | ||||||||||||
Meredith Corporation and Subsidiaries | Table 5 | |||||||||
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. | ||||||||||
Segment EBITDA margin is defined as segment EBITDA divided by segment revenues. | ||||||||||
Three Months Ended March 31, 2010 | Nine Months Ended March 31, 2010 | |||||||||
National Media Group | Local Media Group | Unallocated Corporate | Total | National Media Group | Local Media Group | Unallocated Corporate | Total | |||
(In thousands) | ||||||||||
Revenues | $ 284,585 | $ 68,758 | $ - | $ 353,343 | $ 817,364 | $ 205,249 | $ - | $ 1,022,613 | ||
Operating profit | $ 50,865 | $ 12,828 | $ (7,224) | $ 56,469 | $ 121,232 | $ 32,291 | $ (28,262) | $ 125,261 | ||
Depreciation and amortization | 3,694 | 6,078 | 541 | 10,313 | 10,843 | 18,160 | 1,530 | 30,533 | ||
EBITDA | $ 54,559 | $ 18,906 | $ (6,683) | 66,782 | $ 132,075 | $ 50,451 | $ (26,732) | 155,794 | ||
Less: | ||||||||||
Depreciation and amortization | (10,313) | (30,533) | ||||||||
Net interest expense | (3,946) | (14,712) | ||||||||
Income taxes | (19,224) | (39,955) | ||||||||
Earnings from continuing operations | $ 33,299 | $ 70,594 | ||||||||
Segment EBITDA margin | 19.2% | 27.5% | 16.2% | 24.6% | ||||||
Three Months Ended March 31, 2009 | Nine Months Ended March 31, 2009 | |||||||||
National Media Group | Local Media Group | Unallocated Corporate | Total | National Media Group | Local Media Group | Unallocated Corporate | Total | |||
(In thousands) | ||||||||||
Revenues | $ 280,320 | $ 57,274 | $ - | $ 337,594 | $ 850,895 | $ 212,053 | $ - | $ 1,062,948 | ||
Operating profit | $ 47,971 | $ 1,348 | $ (5,959) | $ 43,360 | $ 105,069 | $ 34,373 | $ (21,981) | $ 117,461 | ||
Depreciation and amortization | 3,789 | 6,471 | 454 | 10,714 | 11,843 | 18,988 | 1,515 | 32,346 | ||
EBITDA | $ 51,760 | $ 7,819 | $ (5,505) | 54,074 | $ 116,912 | $ 53,361 | $ (20,466) | 149,807 | ||
Less: | ||||||||||
Depreciation and amortization | (10,714) | (32,346) | ||||||||
Net interest expense | (4,790) | (15,350) | ||||||||
Income taxes | (13,696) | (40,766) | ||||||||
Earnings from continuing operations | $ 24,874 | $ 61,345 | ||||||||
Segment EBITDA margin | 18.5% | 13.7% | 13.7% | 25.2% | ||||||
SOURCE Meredith Corporation