NEW YORK--(BUSINESS WIRE)--Apr. 25, 2013--
The New York Times Company (NYSE: NYT) announced today first-quarter
2013 diluted earnings per share from continuing operations of $.02
compared with $.06 in the same period of 2012. Excluding severance and
the 2012 special items discussed below, diluted earnings per share from
continuing operations were $.04 in the first quarter of 2013 compared
with $.05 in the first quarter of 2012.
The Company had operating profit of $22.9 million in the first quarter
of 2013 compared with $12.6 million in the same period of 2012.
Excluding depreciation, amortization and severance, operating profit
rose 3.4 percent to $49.6 million from $48.0 million in the first
quarter of 2012.
“Our first-quarter results reflect our continued strides in reshaping
The New York Times Company,” said Mark Thompson, president and chief
executive officer. “The increase in operating profit, excluding
depreciation, amortization and severance, was driven by solid growth in
circulation revenues coupled with tightly managed costs, which were
lower despite ongoing investment in our high-quality journalism and
digital operations.
“Circulation revenues rose nearly 7 percent, led by continued strength
in our digital subscription initiatives. Paid digital subscriptions
across the Company totaled approximately 708,000 at quarter end, an
increase of more than 45 percent year-over-year from the end of the
first quarter of 2012. At the same time, the difficult advertising
environment has continued, though there are currently some signs of
improvement in the second quarter.
“During the first quarter, we took a number of decisive steps to
reposition the Company for the evolving media landscape. We announced
that we were marketing for sale the New England Media Group and that
later this year we will rebrand the International Herald Tribune as the
International New York Times. We will be rolling out other strategic
initiatives designed to further leverage The Times brand and newsroom to
create new products and services for a wider range of customers
domestically and around the globe.”
Comparisons
Unless otherwise noted, all comparisons are for the first quarter of
2013 to the first quarter of 2012. The results of the Regional Media
Group, which was sold in the first quarter of 2012, and the results of
the About Group, which was sold in the fourth quarter of 2012, are
reported within discontinued operations in 2012.
This release includes other non-GAAP financial measures, a discussion of
management’s reasons for the presentation of these non-GAAP financial
measures and reconciliations to the most comparable GAAP financial
measures.
There were no special items in the first quarter of 2013.
The first-quarter 2012 results included the following special items:
-
A $17.8 million ($10.4 million after tax or $.07 per share) gain on
the sale of 100 of the Company’s units in Fenway Sports Group.
-
A $6.7 million ($3.7 million after tax or $.02 per share) charge for
accelerated depreciation expense for certain assets at the Worcester
Telegram & Gazette’s (T&G;) facility in Millbury, Mass., associated
with the consolidation of most of T&G;’s printing into The Boston
Globe’s facility in Boston in the second quarter of 2012.
-
A $4.9 million ($2.9 million after tax or $.02 per share) non-cash
charge for a write-down of certain investments.
In addition to these special items, the Company had severance costs of
$5.0 million ($2.9 million after tax or $.02 per share) and $5.3 million
($3.1 million after tax or $.02 per share) in the first quarters of 2013
and 2012, respectively.
First-Quarter Results from Continuing Operations
Revenues
Total revenues decreased 2.0 percent to $465.9 million from $475.4
million. Circulation revenues increased 6.5 percent, while advertising
and other revenues decreased 11.2 percent and 0.7 percent, respectively.
Circulation revenues rose as digital subscription initiatives and the
increase in print circulation prices at The New York Times in the first
quarter of 2013 offset a decline in print copies sold. Paid subscribers
to The Times and the International Herald Tribune digital subscription
packages, e-readers and replica editions totaled about 676,000 as of the
end of the first quarter of 2013, an increase of more than 45 percent
year-over-year from the end of the first quarter of 2012. Paid digital
subscribers to BostonGlobe.com and The Boston Globe’s e-readers and
replica editions totaled about 32,000 as of the end of the first quarter
of 2013, an increase of more than 50 percent year-over-year from the end
of the first quarter of 2012.
Print and digital advertising revenues decreased 13.3 percent and 4.0
percent, respectively, largely due to ongoing secular trends and an
increasingly complex and fragmented digital advertising marketplace. In
the first quarter of 2013, digital advertising revenues were $46.5
million compared with $48.5 million in the 2012 first quarter. Digital
advertising revenues as a percentage of total Company advertising
revenues were 24.3 percent in the first quarter of 2013 compared with
22.5 percent in the first quarter of 2012.
Operating Costs
Operating costs decreased 4.3 percent to $443.1 million from $462.8
million. Excluding depreciation, amortization and severance, operating
costs decreased 2.6 percent to $416.3 million from $427.4 million mainly
due to lower compensation costs, raw materials expense and outside
printing costs.
Other Data
Joint Ventures
Loss from joint ventures was $2.9 million compared with $29,000 largely
because of lower results for the paper mills in which the Company has an
investment.
Interest Expense, net
Interest expense, net decreased to $14.1 million from $15.5 million
mainly due to the Company’s payment at maturity on September 26, 2012 of
all $75 million aggregate principal amount of the Company’s 4.610
percent senior notes.
Income Taxes
The Company had income tax expense of $3.0 million (effective tax rate
of 50.7 percent) in the first quarter of 2013.
The Company had income tax expense of $1.4 million (effective tax rate
of 13.9 percent) in the first quarter of 2012 impacted by an adjustment
to reduce the Company’s reserve for uncertain tax positions.
Liquidity
As of March 31, 2013, the Company had cash and marketable securities of
approximately $866 million (excluding restricted cash of approximately
$22 million that is subject to certain collateral requirements). Total
debt and capital lease obligations were approximately $698 million.
The Company’s cash and marketable securities decreased in the first
quarter of 2013 from the end of 2012, due in part to the Company’s
contributions of approximately $61 million to certain qualified pension
plans, the majority of which was discretionary. In 2013, the Company
expects contributions to its qualified pension plans to be approximately
$75 million inclusive of the first-quarter contributions.
Capital Expenditures
Capital expenditures totaled approximately $4 million in the first
quarter of 2013.
Outlook
Total circulation revenues are projected to increase in the mid-single
digits in the second quarter of 2013 compared with the same period in
2012.
Total advertising revenue trends in the second quarter of 2013 are
expected to be somewhat better than the level experienced in the first
quarter of 2013.
Total operating costs are expected to decrease in the low-single digits
in the second quarter.
In addition, the Company expects the following on a pre-tax basis in
2013:
-
Results from joint ventures: loss of $1 to $5 million,
-
Depreciation and amortization: $90 to $95 million,
-
Interest expense, net: $55 to $60 million, and
-
Capital expenditures: approximately $40 million.
Conference Call Information
The Company’s first-quarter earnings conference call will be held on
Thursday, April 25, at 11:00 a.m. E.T. To access the call, dial
866-454-4209 (in the U.S.) and 913-981-5596 (international callers).
Participants should dial into the conference call approximately 10
minutes before the start time. Online listeners can link to the live
webcast at www.nytco.com/investors.
An archive of the webcast will be available beginning two hours after
the call at www.nytco.com/investors.
The archive will be available for approximately three months. An audio
replay will be available at 888-203-1112 (in the U.S.) and 719-457-0820
(international callers) beginning approximately two hours after the call
until 5 p.m. E.T. on Friday, April 26. The access code is 8390644.
Except for the historical information contained herein, the matters
discussed in this press release are forward-looking statements that
involve risks and uncertainties that could cause actual results to
differ materially from those predicted by such forward-looking
statements. These risks and uncertainties include national and local
conditions, as well as competition, that could influence the levels
(rate and volume) of circulation and advertising generated by the
Company’s various markets and the development of the Company’s digital
businesses. They also include other risks detailed from time to time in
the Company’s publicly filed documents, including the Company’s Annual
Report on Form 10-K for the year ended December 30, 2012. The Company
undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
The New York Times Company, a leading global, multimedia news and
information company with 2012 revenues of $2.0 billion, includes The New
York Times, the International Herald Tribune, The Boston Globe,
NYTimes.com, BostonGlobe.com, Boston.com and related properties. The
Company’s core purpose is to enhance society by creating, collecting and
distributing high-quality news and information.
|
Exhibits:
|
|
Condensed Consolidated Statements of Operations
|
|
|
|
Revenues by Operating Segment
|
|
|
|
Advertising Revenues by Category
|
|
|
|
Footnotes
|
|
|
|
Reconciliation of Non-GAAP Information
|
THE NEW YORK TIMES COMPANY
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Dollars and shares in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
First Quarter
|
|
|
|
|
2013
|
|
2012
|
|
% Change
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
Circulation
|
$
|
|
241,789
|
|
|
$
|
226,994
|
|
|
6.5
|
%
|
|
|
Advertising
|
191,167
|
|
|
215,234
|
|
|
-11.2
|
%
|
|
Other(a)
|
32,977
|
|
|
33,204
|
|
|
-0.7
|
%
|
|
Total revenues
|
465,933
|
|
|
475,432
|
|
|
-2.0
|
%
|
|
Operating costs
|
|
|
|
|
|
|
|
|
Production costs
|
196,874
|
|
|
203,335
|
|
|
-3.2
|
%
|
|
Selling, general and administrative costs
|
224,389
|
|
|
229,361
|
|
|
-2.2
|
%
|
|
Depreciation and amortization(b)
|
21,800
|
|
|
30,116
|
|
|
-27.6
|
%
|
|
Total operating costs
|
443,063
|
|
|
462,812
|
|
|
-4.3
|
%
|
|
Operating profit
|
22,870
|
|
|
12,620
|
|
|
81.2
|
%
|
|
Gain on sale of investment(c)
|
—
|
|
|
17,848
|
|
|
N/A
|
|
|
|
Write-down of investments(d)
|
—
|
|
|
4,900
|
|
|
N/A
|
|
|
|
Loss from joint ventures
|
2,940
|
|
|
29
|
|
|
*
|
|
|
|
Interest expense, net
|
14,074
|
|
|
15,452
|
|
|
-8.9
|
%
|
|
Income from continuing operations before income taxes
|
5,856
|
|
|
10,087
|
|
|
-41.9
|
%
|
|
Income tax expense
|
2,967
|
|
|
1,401
|
|
|
*
|
|
|
|
Income from continuing operations
|
2,889
|
|
|
8,686
|
|
|
-66.7
|
%
|
|
Income from discontinued operations, net of income taxes(e)
|
—
|
|
|
33,391
|
|
|
N/A
|
|
|
|
Net income
|
2,889
|
|
|
42,077
|
|
|
-93.1
|
%
|
|
Net loss attributable to the noncontrolling interest
|
249
|
|
|
53
|
|
|
*
|
|
|
|
Net income attributable to The New York Times Company
common stockholders
|
$
|
|
3,138
|
|
|
$
|
42,130
|
|
|
-92.6
|
%
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to The New York Times Company common
stockholders:
|
|
|
|
|
|
|
|
|
Income from continuing operations
|
$
|
|
3,138
|
|
|
$
|
8,739
|
|
|
-64.1
|
%
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
33,391
|
|
|
N/A
|
|
|
|
Net income
|
$
|
|
3,138
|
|
|
$
|
42,130
|
|
|
-92.6
|
%
|
|
|
|
|
|
|
|
|
|
|
Average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
148,710
|
|
|
147,867
|
|
|
0.6
|
%
|
|
Diluted
|
155,270
|
|
|
151,468
|
|
|
2.5
|
%
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share attributable to The New York Times
Company common stockholders:
|
|
|
|
|
|
|
|
|
Income from continuing operations
|
$
|
|
0.02
|
|
|
$
|
0.06
|
|
|
-66.7
|
%
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
0.22
|
|
|
N/A
|
|
|
|
Net income
|
$
|
|
0.02
|
|
|
$
|
0.28
|
|
|
-92.9
|
%
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share attributable to The New York Times
Company common stockholders:
|
|
|
|
|
|
|
|
|
Income from continuing operations
|
$
|
|
0.02
|
|
|
$
|
0.06
|
|
|
-66.7
|
%
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
0.22
|
|
|
N/A
|
|
|
|
Net income
|
$
|
|
0.02
|
|
|
$
|
0.28
|
|
|
-92.9
|
%
|
|
|
|
|
|
|
|
|
|
|
* Represents an increase or decrease in excess of 100%.
|
|
|
|
See footnotes page for additional information.
|
|
|
THE NEW YORK TIMES COMPANY
REVENUES BY OPERATING
SEGMENT AND ADVERTISING REVENUES BY CATEGORY
(Dollars in
thousands)
|
|
|
|
|
|
2013
|
|
|
|
First Quarter
|
|
% Change
vs. 2012
|
|
The New York Times Media Group
|
|
|
|
|
|
Circulation
|
|
$
|
205,482
|
|
|
8.2%
|
|
Advertising
|
|
153,538
|
|
|
-11.4%
|
|
Other
|
|
21,655
|
|
|
4.5%
|
|
Total
|
|
$
|
380,675
|
|
|
-0.9%
|
|
|
|
|
|
|
|
New England Media Group
|
|
|
|
|
|
Circulation
|
|
$
|
36,307
|
|
|
-1.9%
|
|
Advertising
|
|
37,629
|
|
|
-10.1%
|
|
Other
|
|
11,322
|
|
|
-9.3%
|
|
Total
|
|
$
|
85,258
|
|
|
-6.7%
|
|
|
|
|
|
|
|
Total Company
|
|
|
|
|
|
Circulation
|
|
$
|
241,789
|
|
|
6.5%
|
|
Advertising
|
|
191,167
|
|
|
-11.2%
|
|
Other(a)
|
|
32,977
|
|
|
-0.7%
|
|
Total
|
|
$
|
465,933
|
|
|
-2.0%
|
|
|
|
|
|
|
|
See footnotes page for additional information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
First Quarter
|
|
% Change
vs. 2012
|
|
National
|
|
$
|
130,105
|
|
|
-10.5%
|
|
Retail
|
|
29,162
|
|
|
-15.0%
|
|
Classified:
|
|
|
|
|
|
Help-Wanted
|
|
5,993
|
|
|
-15.0%
|
|
Real Estate
|
|
8,451
|
|
|
-15.3%
|
|
Automotive
|
|
5,240
|
|
|
-9.8%
|
|
Other
|
|
7,317
|
|
|
-1.9%
|
|
Total Classified
|
|
27,001
|
|
|
-10.9%
|
|
Other
|
|
4,899
|
|
|
-6.6%
|
|
Total Company
|
|
$
|
191,167
|
|
|
-11.2%
|
|
|
THE NEW YORK TIMES COMPANY
FOOTNOTES
(Dollars
in thousands)
|
|
|
|
|
(a)
|
Other revenues consist primarily of revenues from news
services/syndication, commercial printing and distribution, digital
archives, rental income and direct mail advertising services.
|
|
|
|
|
(b)
|
Includes $6.7 million of accelerated depreciation expense in the
first quarter of 2012 for certain assets at the Worcester Telegram &
Gazette’s facility in Millbury, Mass., associated with the
consolidation of most of its printing into The Boston Globe’s
facility in Boston, in the second quarter of 2012.
|
|
|
|
|
(c)
|
In the first quarter of 2012, the Company recorded a $17.8 million
gain on the sale of 100 of its units in Fenway Sports Group.
|
|
|
|
|
(d)
|
In the first quarter of 2012, the Company recorded a $4.9 million
non-cash charge for a write-down of certain investments.
|
|
|
|
|
(e)
|
On September 24, 2012, the Company completed the sale of the About
Group, consisting of About.com, ConsumerSearch.com, CalorieCount.com
and related businesses. The results of the About Group have been
classified as discontinued operations in 2012.
|
|
|
|
|
|
On January 6, 2012, the Company completed the sale of its Regional
Media Group, consisting of 16 regional newspapers, other print
publications and related businesses. The results of the Regional
Media Group have been classified as discontinued operations in 2012.
|
|
|
|
|
|
The following table summarizes the 2012 results of operations
presented as discontinued operations for both the About Group and
the Regional Media Group:
|
|
|
|
|
First Quarter
|
|
|
|
|
2012
|
|
|
|
|
About Group
|
|
Regional
Media Group
|
|
Total
|
|
|
Revenues
|
|
$
|
23,944
|
|
|
$
|
6,115
|
|
|
$
|
|
30,059
|
|
|
|
Total operating costs
|
|
16,948
|
|
|
8,017
|
|
|
24,965
|
|
|
|
Pre-tax income/(loss)
|
|
6,996
|
|
|
(1,902
|
)
|
|
5,094
|
|
|
|
Income tax expense/(benefit)
|
|
2,675
|
|
|
(736
|
)
|
|
1,939
|
|
|
|
Income/(loss) from discontinued operations,
net of income taxes
|
|
4,321
|
|
|
(1,166
|
)
|
|
3,155
|
|
|
|
Gain on sale, net of income taxes:
|
|
|
|
|
|
|
|
|
Gain on sale
|
|
—
|
|
|
2,309
|
|
|
2,309
|
|
|
|
Income tax benefit*
|
|
—
|
|
|
(27,927
|
)
|
|
(27,927
|
)
|
|
|
Gain on sale, net of income taxes
|
|
—
|
|
|
30,236
|
|
|
30,236
|
|
|
|
Income from discontinued operations, net of
income taxes
|
|
$
|
4,321
|
|
|
$
|
29,070
|
|
|
$
|
|
33,391
|
|
|
|
* Tax benefit is primarily due to a tax deduction for goodwill.
|
|
|
|
|
THE NEW YORK TIMES COMPANY
RECONCILIATION OF NON-GAAP
INFORMATION
(Dollars in thousands, except per share data)
|
|
|
|
In this release, the Company has included non-GAAP financial
information with respect to diluted earnings per share from
continuing operations excluding severance and special items;
operating profit before depreciation, amortization, severance and
special items (if any); and operating costs before depreciation,
amortization, severance and raw materials. The Company has included
these non-GAAP financial measures because management reviews them on
a regular basis and uses them to evaluate and manage the performance
of the Company’s operations. Management believes that, for the
reasons outlined below, these non-GAAP financial measures provide
useful information to investors as a supplement to reported diluted
earnings/(loss) per share from continuing operations, operating
profit/(loss) and operating costs. However, these measures should be
evaluated only in conjunction with the comparable GAAP financial
measures and should not be viewed as alternative or superior
measures of GAAP results.
|
|
|
|
Diluted earnings/(loss) per share from continuing operations
excluding severance and special items provide useful information in
evaluating the Company’s period-to-period performance because it
eliminates items that the Company does not consider to be indicative
of earnings from ongoing operating activities. Operating
profit/(loss) before depreciation, amortization, severance and
special items (if any) is useful in evaluating the Company’s ongoing
performance of its businesses as it excludes the significant
non-cash impact of depreciation and amortization as well as items
not indicative of ongoing operating activities. Total operating
costs include depreciation, amortization, severance and raw
materials. Total operating costs excluding these items provide
investors with helpful supplemental information on the Company’s
underlying operating costs that is used by management in its
financial and operational decision-making.
|
|
|
|
Reconciliations of these non-GAAP financial measures from,
respectively, diluted earnings per share from continuing operations,
operating profit and operating costs, the most directly comparable
GAAP items, are set out in the tables below.
|
|
Reconciliation of diluted earnings per
share from continuing operations excluding severance and special
items
|
|
|
|
|
|
|
|
First Quarter
|
|
|
|
2013
|
|
2012
|
|
% Change
|
|
|
Diluted earnings per share from continuing operations
|
|
$
|
0.02
|
|
|
$
|
0.06
|
|
|
-66.7
|
%
|
|
Add:
|
|
|
|
|
|
|
|
Severance
|
|
0.02
|
|
|
0.02
|
|
|
|
|
Special items:
|
|
|
|
|
|
|
|
Accelerated depreciation
|
|
—
|
|
|
0.02
|
|
|
|
|
Gain on sale of investment
|
|
—
|
|
|
(0.07
|
)
|
|
|
|
Write-down of investments
|
|
—
|
|
|
0.02
|
|
|
|
|
Diluted earnings per share from continuing operations
excluding severance and special items
|
|
$
|
0.04
|
|
|
$
|
0.05
|
|
|
-20.0
|
%
|
|
|
|
|
|
|
|
|
|
Reconciliation of operating profit before
depreciation & amortization and severance
|
|
|
|
|
|
|
|
|
First Quarter
|
|
|
|
2013
|
|
2012
|
|
% Change
|
|
|
Operating profit
|
|
$
|
22,870
|
|
|
$
|
12,620
|
|
|
81.2
|
%
|
|
Add:
|
|
|
|
|
|
|
|
Depreciation & amortization
|
|
21,800
|
|
|
30,116
|
|
|
|
|
Severance
|
|
4,951
|
|
|
5,276
|
|
|
|
|
Operating profit before depreciation & amortization
and severance
|
|
$
|
49,621
|
|
|
$
|
48,012
|
|
|
3.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of operating costs before
depreciation & amortization, severance and raw materials
|
|
|
|
|
|
|
|
|
First Quarter
|
|
|
|
2013
|
|
2012
|
|
% Change
|
|
|
Operating costs
|
|
$
|
443,063
|
|
|
$
|
462,812
|
|
|
-4.3
|
%
|
|
Less:
|
|
|
|
|
|
|
|
Depreciation & amortization
|
|
21,800
|
|
|
30,116
|
|
|
|
|
Severance
|
|
4,951
|
|
|
5,276
|
|
|
|
|
Operating costs before depreciation & amortization and severance
|
|
416,312
|
|
|
427,420
|
|
|
-2.6
|
%
|
|
Less:
|
|
|
|
|
|
|
|
Raw materials
|
|
30,093
|
|
|
33,363
|
|
|
|
|
Operating costs before depreciation & amortization,
severance and raw materials
|
|
$
|
386,219
|
|
|
$
|
394,057
|
|
|
-2.0
|
%
|
This press release can be downloaded from www.nytco.com
Source: The New York Times Company
The New York Times Company
For Media:
Abbe
Serphos, 212-556-4425
serphos@nytimes.com
or
For
Investors:
Paula Schwartz, 212-556-5224
paula.schwartz@nytimes.com
or
Andrea
Passalacqua, 212-556-7354
andrea.passalacqua@nytimes.com
|
