News Releases

Jan 28, 2015
Meredith's Fiscal 2015 Second Quarter Earnings Per Share Grow 30 Percent
Local Media Group Delivers Record Revenue and Profit Performance
Digital Advertising and Brand Licensing Produce Record Revenue

DES MOINES, Iowa, Jan. 28, 2015 /PRNewswire/ -- Meredith Corporation (NYSE:MDP; www.meredith.com), the  leading media and marketing company serving more than 100 million American women, today reported fiscal 2015 second quarter earnings per share grew 30 percent to $0.87 compared to $0.67 in the prior-year period.  Total revenues rose 13 percent to $399 million, including 25 percent growth in advertising revenues.

Meredith introduces an updated market positioning and logo that reflect the strength of Meredith's national and local consumer media brands as well as its expanded portfolio of marketing solutions.

Excluding special charges in both periods, fiscal 2015 second quarter earnings per share grew 45 percent to a second quarter record of $1.00, compared to $0.69 in the prior-year period, and operating profit margin increased nearly five percentage points to 20 percent.  Fiscal 2015 second quarter results included special charges of $6 million after tax, or $0.13 per share, primarily due to transaction and integration expenses related to recent acquisitions.  Special charges in the prior-year period were also primarily due to acquisition-related expenses.  (See Tables 1-4 for supplemental disclosures regarding non-GAAP financial measures).

"We continued our strong momentum in the second quarter of fiscal 2015, again delivering higher cash flow and returns to our shareholders," said Meredith Chairman and CEO Stephen M. Lacy.  "Advertising trends strengthened, our recent acquisitions are performing above expectations, and our brands are stronger than ever with consumers across our media platforms and at retail."

Looking more closely at Meredith's fiscal 2015 second quarter compared to the prior-year period, excluding special charges:

  • Local Media Group revenues increased 50 percent to an all-time quarterly record $157 million. Operating profit and EBITDA also set records, growing more than 60 percent each to $60 million and $70 million, respectively. Growth was spurred by the addition of television stations KMOV in St. Louis, KTVK in Phoenix and WGGB in Springfield, Mass.; record political advertising; and higher net retransmission contribution.
  • National Media Group operating profit grew 7 percent and margin strengthened, driven by increased advertising revenues - including record fiscal second quarter digital advertising performance; improved performance by Meredith Xcelerated Marketing; and a 4 percent decrease in operating expenses.
  • Total Company digital advertising revenues grew 45 percent to an all-time quarterly record, driven by both recent acquisitions and organic growth. National Media Group digital advertising revenues increased nearly 45 percent, while Local Media Group digital advertising revenues grew more than 50 percent.
  • Consumer engagement expanded across Meredith's media platforms. According to the latest Magazine Media 360 Brand Audience Report, Meredith's national brands grew their multi-channel audience reach 20 percent to more than 230 million consumers on a monthly basis across print, digital, mobile and video. Meredith's television stations delivered a strong November ratings book. Additionally, traffic to Meredith's digital and mobile sites averaged nearly 70 million unique visitors per month, according to comScore.
  • Meredith continued to strategically expand its portfolio, including the acquisitions of television stations in Mobile-Pensacola and Springfield, Mass.; licensing the rights to operate the Martha Stewart Living and Martha Stewart Weddings media properties; and acquiring digital businesses Mywedding.com and Selectable Media. Earlier today, Meredith announced the acquisition of the Shape print and digital brand from American Media Inc. Meredith expects these portfolio additions will be accretive to earnings and cash flow in fiscal 2015, consistent with its Total Shareholder Return strategy.

Fiscal 2015 first half earnings per share grew 27 percent to $1.52 compared to $1.20 in the prior-year period.  Excluding special charges in both periods, earnings per share rose 35 percent to $1.65 from $1.22 (See Tables 1-4).  Total revenues rose 8 percent to $770 million.

OPERATING GROUP DETAIL

LOCAL MEDIA GROUP

Meredith's Local Media Group includes 17 owned or operated television stations reaching nearly 11 percent of U.S. households.  Meredith's portfolio is concentrated in large, fast-growing markets, including seven stations in the nation's Top 25 and 13 in Top 50 markets.  Meredith's stations produce approximately 650 hours of local news and entertainment content each week.  Meredith expects to continue to grow its Local Media Group both organically and through strategic acquisitions.

Fiscal 2015 second quarter Local Media Group operating profit was $55 millionExcluding special charges, operating profit grew 64 percent to an all-time quarterly record of $60 million; EBITDA grew to a second quarter record of $70 million; and EBITDA margin was 44 percent.  Revenues rose 50 percent to $157 million, also an all-time quarterly record.

Looking more closely at fiscal 2015 second quarter performance compared to the prior-year period:

  • Total advertising revenues increased 58 percent to $125 million, an all-time quarterly record.
  • Political advertising revenues were $29 million and totaled $42 million for the first half of fiscal 2015 - both record highs. In addition to contributions from newly acquired stations in St. Louis and Phoenix, Meredith's existing stations in Phoenix, Hartford and Kansas City generated significant political dollars.
  • Non-political advertising revenues grew 22 percent to $95 million, benefiting from the recent acquisitions and strong digital advertising revenue performance.
  • Other revenues and operating expenses increased, due primarily to growth in retransmission revenues from cable and satellite television operators and higher programming fees paid to affiliated networks, along with contributions from recent acquisitions. Most of Meredith's retransmission agreements with cable and satellite operators are scheduled for renegotiation in the next 24 months. Meanwhile, most of Meredith's network affiliation agreements are in place into fiscal 2017 and beyond.

On Dec. 19, 2014, Meredith completed the acquisition of WALA, the Fox affiliate in Mobile-Pensacola, for $86 million.  On Oct. 31, 2014, Meredith completed the acquisition of WGGB, the ABC affiliate in Springfield, Mass. for $53 million.

"Our television expansion strategy is producing strong revenue and profit growth," said Meredith Local Media Group President Paul Karpowicz.  "We will continue to look for opportunities to strategically add to our broadcasting portfolio, as well as drive growth through increased advertising and retransmission revenues."

Fiscal 2015 first half Local Media Group operating profit was $91 million.  Excluding special charges, operating profit grew 55 percent to $97 million; EBITDA grew 52 percent to $115 million; revenues rose 45 percent to $281 million - all records; and EBITDA margin was 41 percent.

NATIONAL MEDIA GROUP

Meredith's National Media Group reaches a multi-channel audience of more than 230 million consumers monthly, including 100 million unduplicated women and 60 percent of American millennial women.  Meredith is a leader at creating content across media platforms and life stages in key consumer interest areas such as food, home, parenthood and health.  It also features robust brand licensing activities and innovative business-to-business marketing services.  Meredith expects to continue to grow its National Media Group organically and through strategic acquisitions.

Fiscal 2015 second quarter National Media Group operating profit was $26 millionExcluding special charges, operating profit grew 7 percent to $30 million.  Revenues were $242 million.

Looking more closely at fiscal 2015 second quarter performance compared to the prior-year period, excluding special charges:

  • Total advertising revenues grew to $117 million. Digital advertising revenues increased nearly 45 percent to a fiscal second quarter record, and accounted for an all-time high of more than 30 percent of total National Media Group advertising revenues. Growth was driven by strong results at Allrecipes.com, along with the addition of Marthastewart.com and Mywedding.com.
  • Circulation revenues were $59 million, compared to $68 million, primarily due to the Ladies' Home Journal transition, partially offset by the addition of Allrecipes magazine, which increased its rate base to 1.1 million beginning with the February/March 2015 issue, up from 500,000 at launch a year ago.
  • Digital consumer marketing activities continued to expand, driving approximately one-third of magazine subscription acquisitions over the last 12 months.
  • Brand Licensing revenues grew to a second quarter record, driven by sales of more than 3,000 SKUs of Better Homes and Gardens licensed products at more than 4,000 Walmart stores nationwide and at Walmart.com.
  • Operating expenses declined 4 percent due to continued strong expense discipline.

Meredith's consumer engagement continued to grow in the second quarter of fiscal 2015.  According to the most current Magazine Media 360 report, Meredith has two of the three largest brands in the industry: Better Homes and Gardens (No. 2 with a total monthly audience of 53 million) and Allrecipes (No. 3 with a total monthly audience of 52 million).

"We're pleased to report operating profit growth in the quarter, driven by higher advertising revenues, stronger performance from Meredith Xcelerated Marketing, and disciplined expense control," said Meredith National Media Group President Tom Harty.  "Looking ahead, we are excited about the marketplace response to the addition of the Martha Stewart Living media properties; our agreement to purchase Shape, the leader in the women's active lifestyle category; and the enhanced digital native and engagement-based advertising capabilities from Selectable Media."

Fiscal 2015 first half National Media Group operating profit was $55 million.  Excluding special charges, operating profit grew 5 percent to $59 million, and operating margin grew to 12 percent.  Revenues were $489 million, compared to $517 million in the prior-year period.

OTHER FINANCIAL INFORMATION

Consistent with its Total Shareholder Return (TSR) strategy, Meredith repurchased 362,000 shares of its stock in the second quarter of fiscal 2015, and $98 million remained under the current repurchase authorization.  Total debt was $859 million and the weighted average interest rate was 2.4 percent, with $400 million effectively at a fixed rate.  Meredith's debt-to-EBITDA ratio for the trailing 12 months was 2.9 to 1.  All metrics are as of December 31, 2014.

Key elements of Meredith's TSR strategy are (1) An annual dividend of $1.73 per share (yielding approximately 3.5 percent), which reflects a 6 percent increase in the annual dividend over the prior year and a 70 percent increase since Meredith launched its TSR strategy in October 2011; (2) A share repurchase program with $98 million remaining under current authorizations; and (3) Ongoing investments to scale the business and increase shareholder value.

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.  All fiscal 2015 second quarter and first half comparisons are against the comparable prior-year period unless otherwise stated.

OUTLOOK

Meredith expects full year fiscal 2015 earnings per share before special charges to range from $3.25 to $3.35, an increase from the previous range established on July 31, 2014.

The new and higher range reflects expected accretion of between $0.10 to $0.15 from the addition of the Martha Stewart media properties and the Shape brand to Meredith's National Media Group; and WALA in Mobile-Pensacola to Meredith's Local Media Group.

Looking more closely at the third quarter of fiscal 2015 compared to the year-ago period:

  • Total Company revenues are expected to be up high-single digits.
  • Total Local Media Group revenues are expected to be up 25 to 30 percent.
  • Total National Media Group revenues are expected to be up low-single digits.

Meredith expects fiscal 2015 third quarter earnings per share to range from $0.66 to $0.71.  While Meredith expects the addition of the Shape brand to be accretive to earnings for full fiscal 2015, Meredith expects it will be $0.04 dilutive to earnings per share in its third fiscal quarter.  This is due to the timing of certain expenses occurring prior to the generation of revenue.

A number of uncertainties remain that may affect Meredith's outlook as stated in this press release for the third quarter and full year fiscal 2015.  These and other uncertainties are referenced below under "Safe Harbor" and in certain filings with the U.S. Securities and Exchange Commission.

CONFERENCE CALL WEBCAST

Meredith will host a conference call on January 28, 2015 at 11 a.m. EST to discuss fiscal 2015 second quarter 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 two weeks.  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 its performance. Non-GAAP measures should not be construed as alternatives to GAAP measures. EBITDA and EBITDA margin are common supplemental measures 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. Management 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 special charges are supplemental non-GAAP financial measures.  While these adjusted results 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 attached to this press release and 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 release that are forward-looking include, but are not limited to, the Company's revenue and earnings per share outlook for third quarter and full year fiscal 2015.

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 or vendors; 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; increases 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) has been committed to service journalism for more than 110 years.  Today, Meredith uses multiple distribution platforms - including broadcast television, print, digital, mobile, tablets and video - to provide consumers with content they desire and to deliver the messages of its advertising and marketing partners.

Meredith's Local Media Group includes 17 owned or operated television stations reaching 11 percent of U.S. households.  Meredith's portfolio is concentrated in large, fast-growing markets, with seven stations in the nation's Top 25 - including Atlanta, Phoenix and Portland - and 13 in Top 50 markets. Meredith's stations produce approximately 650 hours of local news and entertainment content each week, and operate leading local digital destinations.

Meredith's National Media Group reaches a multi-channel audience of more than 230 million consumers monthly, including 100 million unduplicated women and 60 percent of American millennial women.  Meredith is the leader in creating content across media platforms in key consumer interest areas such as food, home, parenthood and health through well-known brands such as Better Homes and Gardens, Parents and Allrecipes.  The National Media Group features robust brand licensing activities, including more than 3,000 SKUs of branded products at 4,000 Walmart stores across the U.S.  Meredith Xcelerated Marketing is a leader at developing and delivering custom content and customer relationship marketing programs for many of the world's top brands, including Kraft, Lowe's and Chrysler.

Meredith's balanced portfolio consistently generates substantial free cash flow, and the Company is committed to growing Total Shareholder Return through dividend payments, share repurchases and strategic business investments.  Meredith's current annualized dividend of $1.73 per share yields approximately 3.5 percent.  Meredith has paid a dividend for 67 straight years and increased it for 21 consecutive years.

 

 


Meredith Corporation and Subsidiaries

Condensed Consolidated Statements of Earnings (Unaudited)



Three Months


Six Months

Periods ended December 31,

2014



2013



2014



2013


(In thousands except per share data)












Revenues












Advertising

$

241,422



$

193,531



$

459,453



$

392,078


Circulation

59,468



67,733



125,353



143,467


All other

98,015



92,784



185,283



174,955


Total revenues

398,905



354,048



770,089



710,500


Operating expenses












Production, distribution, and editorial

140,283



132,216



282,170



272,993


Selling, general, and administrative

175,452



158,341



339,128



319,413


Depreciation and amortization

14,308



11,590



27,077



23,385


Total operating expenses

330,043



302,147



648,375



615,791


Income from operations

68,862



51,901



121,714



94,709


Interest expense, net

(4,785)



(2,555)



(9,027)



(5,268)


Earnings before income taxes

64,077



49,346



112,687



89,441


Income taxes

(24,486)



(18,777)



(43,731)



(34,831)


Net earnings

$

39,591



$

30,569



$

68,956



$

54,610














Basic earnings per share

$

0.89



$

0.68



$

1.55



$

1.22


Basic average shares outstanding

44,483



44,696



44,471



44,672














Diluted earnings per share

$

0.87



$

0.67



$

1.52



$

1.20


Diluted average shares outstanding

45,268



45,619



45,224



45,499














Dividends paid per share

$

0.4325



$

0.4075



$

0.8650



$

0.8150


 

 

Meredith Corporation and Subsidiaries

Segment Information (Unaudited)



Three Months


Six Months

Periods ended December 31,

2014



2013



2014



2013


(In thousands)












Revenues












National media












Advertising

$

116,774



$

114,543



$

242,006



$

248,227


Circulation

59,468



67,733



125,353



143,467


Other revenues

66,139



67,418



121,348



124,899


   Total national media

242,381



249,694



488,707



516,593


Local media












Non-political advertising

95,326



78,270



175,162



142,622


Political advertising

29,322



718



42,285



1,229


Other revenues

31,876



25,366



63,935



50,056


   Total local media

156,524



104,354



281,382



193,907


Total revenues

$

398,905



$

354,048



$

770,089



$

710,500














Operating profit












National media

$

26,107



$

28,070



$

55,002



$

56,146


Local media

54,986



35,225



91,298



60,901


Unallocated corporate

(12,231)



(11,394)



(24,586)



(22,338)


Income from operations

$

68,862



$

51,901



$

121,714



$

94,709














Depreciation and amortization












National media

$

3,487



$

4,783



$

7,112



$

9,733


Local media

10,395



6,399



19,110



12,832


Unallocated corporate

426



408



855



820


Total depreciation and amortization

$

14,308



$

11,590



$

27,077



$

23,385














EBITDA 1












National media

$

29,594



$

32,853



$

62,114



$

65,879


Local media

65,381



41,624



110,408



73,733


Unallocated corporate

(11,805)



(10,986)



(23,731)



(21,518)


Total EBITDA 1

$

83,170



$

63,491



$

148,791



$

118,094



1 EBITDA is net earnings before interest, taxes, depreciation, and amortization.

 

 


Meredith Corporation and Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)


Assets

December 31,
 2014


June 30,
 2014

(In thousands)







Current assets







Cash and cash equivalents


$

18,123



$

36,587


Accounts receivable, net


289,658



257,644


Inventories


26,213



24,008


Current portion of subscription acquisition costs


97,609



96,893


Current portion of broadcast rights


12,083



4,551


Assets held for sale


54,610



32,900


Other current assets


24,381



17,429


Total current assets


522,677



470,012


Property, plant, and equipment


524,803



501,216


Less accumulated depreciation


(312,274)



(296,168)


Net property, plant, and equipment


212,529



205,048


Subscription acquisition costs


105,808



101,533


Broadcast rights


2,809



3,114


Other assets


87,419



86,935


Intangible assets, net


930,090



835,531


Goodwill


941,237



841,627


Total assets


$

2,802,569



$

2,543,800









Liabilities and Shareholders' Equity







Current liabilities







Current portion of long-term debt


$

62,500



$

87,500


Current portion of long-term broadcast rights payable


12,137



4,511


Accounts payable


76,308



81,402


Accrued expenses and other liabilities


149,186



136,047


Current portion of unearned subscription revenues


184,282



173,643


Total current liabilities


484,413



483,103


Long-term debt


796,250



627,500


Long-term broadcast rights payable


4,223



4,327


Unearned subscription revenues


166,464



151,533


Deferred income taxes


287,509



277,477


Other noncurrent liabilities


140,604



108,208


Total liabilities


1,879,463



1,652,148


Shareholders' equity







Common stock


37,247



36,776


Class B stock


7,288



7,700


Additional paid-in capital


43,555



41,884


Retained earnings


844,189



814,050


Accumulated other comprehensive loss


(9,173)



(8,758)


Total shareholders' equity


923,106



891,652


Total liabilities and shareholders' equity


$

2,802,569



$

2,543,800


 

 


Meredith Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)


Six months ended December 31,

2014



2013


(In thousands)






Net cash provided by operating activities

$

74,369



$

60,687








Cash flows from investing activities






Acquisitions of and investments in businesses

(183,944)



(879)


Additions to property, plant, and equipment

(11,855)



(11,272)


Net cash used in investing activities

(195,799)



(12,151)








Cash flows from financing activities






Proceeds from issuance of long-term debt

285,000



106,000


Repayments of long-term debt

(141,250)



(116,000)


Dividends paid

(38,817)



(36,628)


Purchases of Company stock

(36,177)



(58,198)


Proceeds from common stock issued

28,389



50,633


Excess tax benefits from share-based payments

6,035



3,866


Other

(214)




Net cash provided by (used in) financing activities

102,966



(50,327)


Net decrease in cash and cash equivalents

(18,464)



(1,791)


Cash and cash equivalents at beginning of period

36,587



27,674


Cash and cash equivalents at end of period

$

18,123



$

25,883


 

 


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.


Periods Ended December 31, 2014

Three Months


Six Months


Excluding
Special
Items


Special
Items


As
Reported


Excluding
Special
Items


Special
Items


As
Reported

(In thousands except per share data)


















Revenues


















Advertising

$

241,422



$



$

241,422



$

459,453



$



$

459,453


Circulation

59,468





59,468



125,353





125,353


All other

98,015





98,015



185,283





185,283


Total revenues

398,905





398,905



770,089





770,089


Operating expenses


















Production, distribution, and editorial

140,283





140,283



282,170





282,170


Selling, general, and administrative

167,254



8,198


(a)

175,452



330,930



8,198


(a)

339,128


Depreciation and amortization

13,049



1,259


(b)

14,308



25,818



1,259


(b)

27,077


Total operating expenses

320,586



9,457



330,043



638,918



9,457



648,375


Income from operations

78,319



(9,457)



68,862



131,171



(9,457)



121,714


Interest expense, net

(4,785)





(4,785)



(9,027)





(9,027)


Earnings before income taxes

73,534



(9,457)



64,077



122,144



(9,457)



112,687


Income taxes

(28,127)



3,641



(24,486)



(47,372)



3,641



(43,731)


Net earnings

$

45,407



$

(5,816)



$

39,591



$

74,772



$

(5,816)



$

68,956




















Basic earnings per share

$

1.02



$

(0.13)



$

0.89



$

1.68



$

(0.13)



$

1.55


Basic average shares outstanding

44,483



44,483



44,483



44,471



44,471



44,471




















Diluted earnings per share

$

1.00



$

(0.13)



$

0.87



$

1.65



$

(0.13)



$

1.52


Diluted average shares outstanding

45,268



45,268



45,268



45,224



45,224



45,224




















(a) Severance costs of $5.3 million, acquisition and disposal transaction costs of $2.7 million, and other write-downs and accruals of $0.2 million

(b) Write-down video production fixed assets

 

 


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.


Periods Ended December 31, 2014

Three Months


Six Months


Excluding
Special
Items


Special
Items


As
Reported


Excluding
Special
Items


Special
Items


As
Reported

(In thousands)


















Revenues


















National media


















Advertising

$

116,774



$



$

116,774



$

242,006



$



$

242,006


Circulation

59,468





59,468



125,353





125,353


Other revenues

66,139





66,139



121,348





121,348


  Total national media

242,381





242,381



488,707





488,707


Local media


















Non-political advertising

95,326





95,326



175,162





175,162


Political advertising

29,322





29,322



42,285





42,285


Other revenues

31,876





31,876



63,935





63,935


  Total local media

156,524





156,524



281,382





281,382


Total revenues

$

398,905



$



$

398,905



$

770,089



$



$

770,089




















Operating profit


















National media

$

30,175



$

(4,068)


(a)

$

26,107



$

59,070



$

(4,068)


(a)

$

55,002


Local media

60,375



(5,389)


(b)

54,986



96,687



(5,389)


(b)

91,298


Unallocated corporate

(12,231)





(12,231)



(24,586)






(24,586)


Income from operations

$

78,319



$

(9,457)



$

68,862



$

131,171



$

(9,457)



$

121,714




















Depreciation and amortization


















National media

$

3,487



$



$

3,487



$

7,112



$



$

7,112


Local media

9,136



1,259


(c)

10,395



17,851



1,259


(c)

19,110


Unallocated corporate

426





426



855





855


Total depreciation and amortization

$

13,049



$

1,259



$

14,308



$

25,818



$

1,259



$

27,077




















EBITDA1


















National media

$

33,662



$

(4,068)



$

29,594



$

66,182



$

(4,068)



$

62,114


Local media

69,511



(4,130)



65,381



114,538



(4,130)



110,408


Unallocated corporate

(11,805)





(11,805)



(23,731)





(23,731)


Total EBITDA1

$

91,368



$

(8,198)



$

83,170



$

156,989



$

(8,198)



$

148,791




















Local media EBITDA1 margin

44.4

%





41.8

%


40.7

%





39.2

%



















1 EBITDA is net earnings before interest, taxes, depreciation, and amortization.



















(a) Severance costs of $3.6 million and acquisition transaction costs of $0.5 million

(b) Acquisition and disposal transaction costs of $2.3 million, severance costs of $1.6 million, write-down of video production fixed assets of $1.3 million, and other write-downs and accruals of $0.2 million

(c) Write-down of video production fixed assets

 

 


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.


Periods Ended December 31, 2013

Three Months


Six Months


Excluding
Special
Items


Special
Items


As
Reported


Excluding
Special
Items


Special
Items


As
Reported

(In thousands except per share data)


















Revenues


















Advertising

$

193,531



$



$

193,531



$

392,078



$



$

392,078


Circulation

67,733





67,733



143,467





143,467


All other

92,784





92,784



174,955





174,955


Total revenues

354,048





354,048



710,500





710,500


Operating expenses


















Production, distribution, and editorial

132,216





132,216



272,993





272,993


Selling, general, and administrative

156,776



1,565


(a)

158,341



317,848



1,565


(a)

319,413


Depreciation and amortization

11,590





11,590



23,385





23,385


Total operating expenses

300,582



1,565



302,147



614,226



1,565



615,791


Income from operations

53,466



(1,565)



51,901



96,274



(1,565)



94,709


Interest expense, net

(2,555)





(2,555)



(5,268)





(5,268)


Earnings before income taxes

50,911



(1,565)



49,346



91,006



(1,565)



89,441


Income taxes

(19,380)



603



(18,777)



(35,434)



603



(34,831)


Net earnings

$

31,531



$

(962)



$

30,569



$

55,572



$

(962)



$

54,610




















Basic earnings per share

$

0.70



$

(0.02)



$

0.68



$

1.24



$

(0.02)



$

1.22


Basic average shares outstanding

44,696



44,696



44,696



44,672



44,672



44,672




















Diluted earnings per share

$

0.69



$

(0.02)



$

0.67



$

1.22



$

(0.02)



$

1.20


Diluted average shares outstanding

45,619



45,619



45,619



45,499



45,499



45,499




















(a) Acquisition transaction costs

 

 


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.


Periods Ended December 31, 2013

Three Months


Six Months


Excluding
Special
Items


Special
Items


As
Reported


Excluding
Special
Items


Special
Items


As
Reported

(In thousands)


















Revenues


















National media


















Advertising

$

114,543



$



$

114,543



$

248,227



$



$

248,227


Circulation

67,733





67,733



143,467





143,467


Other revenues

67,418





67,418



124,899





124,899


  Total national media

249,694





249,694



516,593





516,593


Local media


















Non-political advertising

78,270





78,270



142,622





142,622


Political advertising

718





718



1,229





1,229


Other revenues

25,366





25,366



50,056





50,056


  Total local media

104,354





104,354



193,907





193,907


Total revenues

$

354,048



$



$

354,048



$

710,500



$



$

710,500




















Operating profit


















National media

$

28,070



$



$

28,070



$

56,146



$



$

56,146


Local media

36,790



(1,565)


(a)

35,225



62,466



(1,565)


(a)

60,901


Unallocated corporate

(11,394)





(11,394)



(22,338)





(22,338)


Income from operations

$

53,466



$

(1,565)



$

51,901



$

96,274



$

(1,565)



$

94,709




















Depreciation and amortization


















National media

$

4,783



$



$

4,783



$

9,733



$



$

9,733


Local media

6,399





6,399



12,832





12,832


Unallocated corporate

408





408



820





820


Total depreciation and amortization

$

11,590



$



$

11,590



$

23,385



$



$

23,385




















EBITDA1


















National media

$

32,853



$



$

32,853



$

65,879



$



$

65,879


Local media

43,189



(1,565)


(a)

41,624



75,298



(1,565)


(a)

73,733


Unallocated corporate

(10,986)





(10,986)



(21,518)





(21,518)


Total EBITDA1

$

65,056



$

(1,565)



$

63,491



$

119,659



$

(1,565)



$

118,094




















Local media EBITDA1 margin

41.4

%





39.9

%


38.8

%





38.0

%



















1 EBITDA is net earnings before interest, taxes, depreciation, and amortization.



















(a) Acquisition transaction costs

 

 

Table 5

Meredith Corporation and Subsidiaries

Supplemental Disclosures Regarding Non-GAAP Financial Measures


EBITDA

Consolidated EBITDA, which is reconciled to net earnings in the following tables, is defined as net earnings 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 December 31, 2014


National
Media


Local
Media


Unallocated
Corporate


Total

(In thousands)












Revenues

$

242,381



$

156,524



$



$

398,905














Operating profit

$

26,107



$

54,986



$

(12,231)



$

68,862


Depreciation and amortization

3,487



10,395



426



14,308


EBITDA

$

29,594



$

65,381



$

(11,805)



83,170


Less:












Depreciation and amortization










(14,308)


Net interest expense










(4,785)


Income taxes










(24,486)


Net earnings










$

39,591














Segment EBITDA margin

12.2

%


41.8

%
































Three months ended December 31, 2013


National
Media


Local
Media


Unallocated
Corporate


Total

(In thousands)












Revenues

$

249,694



$

104,354



$



$

354,048














Operating profit

$

28,070



$

35,225



$

(11,394)



$

51,901


Depreciation and amortization

4,783



6,399



408



11,590


EBITDA

$

32,853



$

41,624



$

(10,986)



63,491


Less:












Depreciation and amortization










(11,590)


Net interest expense










(2,555)


Income taxes










(18,777)


Net earnings










$

30,569














Segment EBITDA margin

13.2

%


39.9

%










Six months ended December 31, 2014


National
Media


Local
Media


Unallocated
Corporate


Total

(In thousands)












Revenues

$

488,707



$

281,382



$



$

770,089














Operating profit

$

55,002



$

91,298



$

(24,586)



$

121,714


Depreciation and amortization

7,112



19,110



855



27,077


EBITDA

$

62,114



$

110,408



$

(23,731)



148,791


Less:












Depreciation and amortization










(27,077)


Net interest expense










(9,027)


Income taxes










(43,731)


Net earnings










$

68,956














Segment EBITDA margin

12.7

%


39.2

%
































Six months ended December 31, 2013


National
Media


Local
Media


Unallocated
Corporate


Total

(In thousands)












Revenues

$

516,593



$

193,907



$



$

710,500














Operating profit

$

56,146



$

60,901



$

(22,338)



$

94,709


Depreciation and amortization

9,733



12,832



820



23,385


EBITDA

$

65,879



$

73,733



$

(21,518)



118,094


Less:












Depreciation and amortization










(23,385)


Net interest expense










(5,268)


Income taxes










(34,831)


Net earnings










$

54,610














Segment EBITDA margin

12.8

%


38.0

%







 

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To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/merediths-fiscal-2015-second-quarter-earnings-per-share-grow-30-percent-300026735.html

SOURCE Meredith Corporation

For further information: Shareholder/Financial Analyst: Mike Lovell, Director of Investor Relations, (515) 284-3622, Mike.Lovell@meredith.com, or Media: Art Slusark, Chief Communications Officer, (515) 284-3404, Art.Slusark@meredith.com