10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10‑K

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended: December 27, 2015
or
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from  to 

Commission file number: 1‑9824

The McClatchy Company

(Exact name of registrant as specified in its charter)

Delaware	52‑2080478
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2100 Q Street, Sacramento, CA	95816
(Address of principal executive offices)	(Zip Code)

916‑321‑1844

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Class A Common Stock, par value $.01 per share	New York Stock Exchange

Securities registered pursuant to Section 12 (g) of the Act: None

Indicate by check mark if the registrant is a well‑known seasoned issuer, as defined in Rule 405 of the Securities Act.

☐ Yes ☒ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

☐ Yes ☒ No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S‑T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

☒ Yes ☐ No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S‑K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10‑K or any amendment to this Form 10‑K. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non‑accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b‑2 of the Exchange Act. (Check one):

Large accelerated filer ☐ Accelerated filer ☒ Non-accelerated filer ☐
(Do not check if a smaller
reporting company) Smaller reporting company ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act).  ☐ Yes ☒ No

Based on the closing price of the registrant’s Class A Common Stock on the New York Stock Exchange on June 28, 2015, the last business day of the registrant’s second fiscal quarter, the aggregate market value of the voting and non‑voting common equity held by non‑affiliates was approximately $86.6million. For purposes of the foregoing calculation only, as required by Form 10‑K, the Registrant has included in the shares owned by affiliates, the beneficial ownership of Common Stock of officers and directors of the Registrant and members of their families, and such inclusion shall not be construed as an admission that any such person is an affiliate for any purpose.

Shares outstanding as of February 29, 2016:

Class A Common Stock	54,507,190
Class B Common Stock	24,431,962

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s Definitive Proxy Statement to be delivered to shareholders in connection with the Annual Meeting of Shareholders to be held on May 18, 2016, are incorporated by reference in Part III of this Annual Report on Form 10‑K.

TABLE OF CONTENTS

PART I
Item 1.	Business	2
Item 1A.	Risk Factors	9
Item 1B.	Unresolved Staff Comments	16
Item 2.	Properties	16
Item 3.	Legal Proceedings	16
Item 4.	Mine Safety Disclosures	17
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	18
Item 6.	Selected Financial Data	20
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	40
Item 8.	Financial Statements and Supplementary Data	41
Item 9.	Changes In and Disagreements With Accountants on Accounting and Financial Disclosure	75
Item 9A.	Controls and Procedures	75
Item 9B.	Other Information	75
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	76
Item 11.	Executive Compensation	76
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	76
Item 13.	Certain Relationships and Related Transactions, and Director Independence	76
Item 14.	Principal Accounting Fees and Services	76
PART IV
Item 15.	Exhibits, Financial Statement Schedules	77
SIGNATURES		78

PART I

Forward‑Looking Statements:

This annual report on Form 10‑K contains forward‑looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”), including statements relating to our future financial performance, business, strategies and operations. These statements are based upon our current expectations and knowledge of factors impacting our business and are generally preceded by, followed by or are a part of sentences that include the words “believes,” “expects,” “anticipates,” “estimates” or similar expressions. All statements, other than statements of historical fact, are statements that could be deemed forward‑looking statements. For all of those statements, we claim the protection of the safe harbor for forward‑looking statements contained in the PSLRA. Such statements are subject to risks, trends and uncertainties. A detailed discussion of these and other risks and uncertainties that could cause actual results and events to differ materially from such forward‑looking statements is included in the section entitled “Risk Factors” (refer to Part I, Item 1A). We undertake no obligation to revise or update any forward‑looking statements except as required under applicable law.

ITEM 1.  BUSINESS

Overview

The McClatchy Company (the “Company,” “we,” “us” or “our”) is a 21st century news and information publisher of well-respected publications such as the Miami Herald, The Kansas City Star, The Sacramento Bee, The Charlotte Observer,  The (Raleigh) News and Observer, and the (Fort Worth) Star-Telegram. Incorporated in Delaware, we operate media companies in 28 U.S. markets in 14 states, providing each of these communities with high-quality news and advertising services in a wide array of digital and print formats. We are headquartered in Sacramento, California, and our Class A Common Stock is listed on the New York Stock Exchange under the symbol MNI.

Our operations include 29 local media businesses in 28 growth markets across the United States that are comprised of daily newspapers, websites and mobile apps, mobile news and advertising, video products, niche publications, direct marketing,  direct mail services and nearby community newspapers. Our newspapers range from large dailies serving metropolitan areas to non‑daily newspapers serving small communities. For the year ended December 27, 2015, we had an average aggregate paid daily circulation of 1.6 million and Sunday circulation of 2.4 million. As of December 27, 2015, we had 50.6 million monthly unique visitors to our online platforms. Our local websites and mobile apps in each of our markets complement our newspapers and are integral to extending our journalism and advertising products to our audience in each market.

Our business is roughly divided between those media companies operated west of the Mississippi River and those that are east of it, but include five operating regions: California, the Carolinas, Southeast, Midwest and Northwest. For the year ended December 27, 2015, no single newspaper and its related businesses represented more than 12.0% of total revenues.

In addition to our media companies, we also own 15.0% of CareerBuilder, LLC, which operates the nation’s largest online job website, CareerBuilder.com; 33.3% of HomeFinder, LLC, which operates the online real estate website HomeFinder.com; as well as certain other digital company investments.

Our fiscal year ends on the last Sunday in December. The fiscal years ended December 27, 2015, December 28, 2014, and December 29, 2013, consist of 52‑week periods.

Strategy

We are committed to a three‑pronged strategy to grow our businesses and total revenues as a leading local media company:

· First, to maintain our position as the leading local media company in each market by providing high-quality journalism and advertising information to audiences throughoutthe day on digital platforms and in our printed newspapers; and to grow these audiences for the benefit of our advertisers;

· Second, to grow non-traditional revenues with a focus on digital revenues. This strategy includes operating the leading local digital business in each of our daily newspaper markets, including websites, mobile apps,

2

e‑mail products, mobile services, video products and other electronic media; and

· Third, to extend these franchises by supplementing the reach of the newspaper and digital businesses with direct marketing, niche publications and events and direct mail products so that advertisers can capture both mass and targeted audiences with one‑stop shopping.

To assist us with these strategies, we have continually reengineered our operations to reduce legacy costs and strengthen areas driving performance in news, audience, advertising and digital growth. As a result of our efforts, we saw accelerated growth in digital revenues in the second half of 2015 and we continued our focus on driving results in direct marketing and audience revenues.

Business Initiatives

Our local media businesses continue to undergo tremendous structural and cyclical change. In order to strengthen our position as a leading local media company and implement our strategies, we are focused on the following five major business initiatives:

Increasing and Broadening Total Revenues

Revenue initiatives in 2015 included adding resources to our digital sales team, revamping our sales forces in our six largest markets and growing our digital marketing product thatprovides agency services to small and medium-sized businesses in our markets. We realigned and improved delivery of our content on all platforms, from printed newspapers to websites to mobile apps in nearly every market. We also expanded our video efforts to improve storytelling and generate additional advertising revenues.

Our revenues from areas other than traditional newspaper print advertising continue to grow as a percentage of total revenues. Digital and direct marketing advertising, coupled with audience and other revenues generated outside of traditional print and preprinted insert advertising, represented 66.7%, 62.4% and59.2%of total revenues in 2015, 2014 and 2013, respectively. Our strategy has been to focus on growing revenue sources that include digital and direct marketing advertising, audience and other non-traditional revenues. Management expects newspaper print advertising to be a smaller share of overall advertising in the future, due in part to expected strong growth in digital-only advertising revenues, improved performance in direct marketing advertising and more stable performance in audience revenues. However, we continue to look for opportunities to expand our advertiser base, including print.

Overall, advertising revenues comprise a large majority of our revenues, making the quality of our sales forces of utmost importance and were approximately 60.3% of total revenues in 2015 and 63.8% in 2014. We have a local sales force in each of our markets, and believe that these sales forces are generally larger than those of other local media outlets and websites in those markets. Our sales forces are responsible for delivering to advertisers the broad array of our advertising products, including print, digital and direct marketing. Our advertisers range from large national retail chains to local automobile dealerships to small businesses and classified advertisers.

Increasingly, our emphasis has been on growing the breadth of products offered to advertisers, particularly our digital products and our direct marketing products, while expanding our relationships with local advertisers. For example, over the last several years we have provided a “Sunday Select” program, which delivers a package of preprinted advertisements on Sunday to non‑newspaper subscribers that are interested in circulars.  For 2015, total digital and direct marketing advertising revenues represented 44.9% of total advertising revenues on a combined basis compared to 41.1% and 39.6% in 2014 and 2013, respectively.Our digital products are discussed in more detail below.

In 2015, we expanded our sponsorship of special events programs in our markets, designed for advertisers to connect with their customers, and expect this type of advertising to grow in 2016.  

Audience revenues were approximately34.8% of consolidated total revenues in 2015 and 32.0% in 2014. Our subscription packages have helped diversify our revenues while continuing to drive growth indigital audience revenues.

Expanding McClatchy’s Digital Business

We continue to be anindustry leader in digital advertising revenues generated on our newspaper websites and mobile

3

platforms as a percent of total advertising.  In 2015,26.2%  of advertising revenues came from digital products compared to23.7% in 2014. For 2015,  63.5% of our digital advertising revenues came from digital-only advertisements where the online buy was not tied to an “up-sale” of a joint print buy, compared to 59.4% in 2014. We believe this independent advertising revenue stream positions us well for the future of our digital business and is evidence of its importance as a delivery channel for advertisers.During 2015,total digital advertising revenues declined 3.7% compared to a decline of 10.9% in 2014, due primarily to a change in fees associated with one digital contract.

Our newspaper websites and mobile apps, e‑mail projects, mobile services and other electronic media enable us to engage our readers with real‑time news and information that matters to them. During 2015, our newspaper websites attracted an average of approximately 44.7 million unique visitors per month, up 3.4% compared to an average of approximately 43.2 million unique visitors per month in 2014.As of December 27, 2015, we had 50.6 million monthly unique visitors to our sites. Increasing our number of unique visitors brings additional digital advertising revenue opportunities to our sales teams. In addition, our mobile traffic was up 18.6% as compared to 2014, and accounted for 53.4% of all digital traffic we received on a monthly basis.

During 2015, our websites offered classified digital advertising products provided by companies in which we hold a  minority investment, including CareerBuilder.com for employment.We continue to pursue additional new digital products and offerings. We  offer impressLOCAL®, our proprietary comprehensive digital marketing solution for local small and medium‑size businesses, in all of our markets. By offering advertisers integrated packages including website customization, search engine marketing and optimization, social media presence and marketing services, and other multi‑platform advertising opportunities, impressLOCAL® helps businesses improve the effectiveness of their marketing and advertising efforts.

In 2015, we expanded our advertising efforts on ad exchanges. Our real-time, programmatic buying and selling of digital advertising inventory – often targeting very specific audiences at very specific times – grew 77.6% in 2015 compared to 2014.  Our growth has been bolstered by our participation in the Local Media Consortium (“LMC”) and its more than 70 member companies representing more than 1,600 daily newspapers and broadcast members. The LMC has created a private advertising exchange that includes the inventory of the entire collective digital advertising inventory for participating companies.  LMC’s goal is to offer customers access to all member companies and allow the LMC member the opportunity to provide their 10 billion monthly advertising impressions to advertisers, improving the results for all member companies.

Video revenue increased 30.7% in 2015 compared to 2014, due to our continued expansionof the use of video in all of our digital products to both enhance the content that we bring to readers and viewers and also to compete for a growing advertising stream.During 2015, more than 82 million video views were recorded across all digital platforms, including those on social media platforms and distribution partners.

All of our markets now offer subscription packages for digital content. The packages include a combined digital and print subscription and a digital‑only subscription. Digital‑only subscriptions grew to approximately 79,300 subscriptions, an increase of 11.3% in 2015 compared to 71,200 subscriptions in 2014.

Maintaining Our Commitment to Public Service Journalism

We believe that high‑quality news content is the foundation of the mass reach necessary for the press to play its role in a democratic society. It is also the underpinning of our success in the marketplace.

We are committed to developing best‑in‑class journalism and local content. Every market is expected to improve annually as evidenced by peer awards, readership studies in its market, maintenance of readership (both print and electronic) and review of its content and quality. Most importantly, when we talk about our mission, from news meetings to board meetings, a constant theme is how to stay true to the public service role that we believe defines our work.

During the transition that has reshaped the industry over the past decade, we have moved quickly to expand our digital reach and deliver the news in a changing technological landscape. We have also made it a key plank in our evolution to maintain the deeper coverage that our communities need. When we launched a broad revamping of our approach to news in 2015, one of the central concepts was how to enhance the depth of coverage along with the speed of our work. Every market added an element across all platforms that highlighted the deeper story. Our larger newspapers, from Sacramento to Charlotte to Miami, included a full section on in-depth coverage.

4

Our legacy of public service journalism is the cornerstone of our business and the work of McClatchy's journalists received significant recognition last year. Our Washington bureau finished as a 2015 Pulitzer Prize finalist for National Reporting for its coverage of the Senate’s investigation of the CIA’s interrogation program. With this honor we extend our impressive streak of being a Pulitzer winner or finalist every year for more than a decade.

In 2015, journalists from The Miami Herald won several awards for their “Innocents Lost” series, which examined the deaths of nearly 500 children in Florida who had a history with the state’s Department of Children & Families. The awards received included the Goldsmith Prize, the Selden Ring Award and the Worth Bingham Prize.

Also in Miami, one of our journalists won a George Polk as well as a Robert F. Kennedy Award for Justice Reporting last year for work that uncovered physical abuse of inmates by Florida prison guards. Also in 2015, a Charlotte Observer investigation that revealed glaring problems with North Carolina’s medical examiner system won the top national, public service award from the Society of Professional Journalists.

These stories are just a few of hundreds of examples of powerful McClatchy journalism published across the company. We intend to build on our legacy in the years ahead, propelled by the success of our ongoing digital transformation.

Broadening Newspapers’ Audiences in Their Local Markets

Each of our daily newspapers has the largest print circulation of any newspaper serving its respective community, and coupled with its local website and other digital platforms in each community, reaches a broad audience in each market. We believe that our broad reach in each market is of primary importance in attracting advertising, which is our principal source of revenues.

Daily newspaper paid circulation volumes for 2015were down 4.8% compared to 2014,an improvement from the 6.5% rate of decline in 2014 compared to 2013. The declines in daily circulation reflectthe fragmentation of audiences faced by all media, including our own digital‑only subscriptions, as available media outlets proliferate and readership trends change. Our Sunday circulation volumes were down 6.3% in 2015 compared to2014.

Our digital audience continued to grow in 2015. During 2015, average monthly unique visitors to our digital sites grew 3.4% as a result of continued focus and initiatives to improve our total revenues. As discussed above, we realigned and improved delivery of our content on all platforms, from printed newspapers to websites to mobile apps in nearly every market. Our websites offer mobile‑friendly versions for smartphones, and our content is available on e‑readers, tablets and other mobile devices.

As noted earlier, in 2015, our monthly mobile traffic was up 18.6% as compared to 2014 and accounted for 53.4% of all monthly digital traffic we received. We work hard to appeal to our mobile audience. We have invested in new digital publishing systems to better serve this mobile audience and we have rebuilt all of our news websites to be responsive – that is to automatically resize to best fit a user’s screen, be it a smartphone or a tablet or desktop computer, and provide the optimal viewing experience.

Our news and information can follow readers throughout their day. To start their day, we reach our readers with the morning newspaper or they can check out our latest headlines and stories on their mobile phone. Our news websites, updated frequently throughout the day, are available to readers via their desktop computers at work and optimized for all of their different mobile devices.

We also reach audiences through our direct marketing products. In 2015, we distributed approximately 680,000 Sunday Select packages per week, which are packages of preprinted advertisements generally delivered on Sunday to non‑newspaper subscribers who have interest in circulars. We also distribute thousands of e-mail alerts, including editorial and advertising content, dealsaver® alerts and other alerts to subscribers and non‑subscribers in our markets which supplement the reach of our print and digital subscriptions.

To remain the leading local media company for the communities we serve and a must‑buy for advertisers, we are focused on maintaining a broad reach of print and digital audiences in each of our markets. We will continue to refine and strengthen our print platform, but our growth increasingly comes from our digital products and the beneficial impact those products have on the total audience we deliver for our advertisers.

5

Focusing on Cost Efficiencies While Investing for the Future

While continuing to maintain our core business in news, advertising sales and digital, we are also focused on cost efficiencies. Our cost initiatives in 2015 were focused on reducing legacy costs from our traditional print business and we have realized significant savings from these efforts, primarily in production and distribution, including substantial savings in newsprint costs. We realized approximately $32 million of cost savings in 2015 from these specific initiatives, while still investing in our digital infrastructure and products. In addition, our media companies made additional reductions in costs to help protect our profitability in a period of declining print advertising in 2015. Total expenses excluding depreciation, amortization and non-cash impairment charges declined $46.9million in 2015, compared to2014.  The ongoing structural and cyclical changes in our markets demand that we respond by reengineering and restructuring our operations, as needed, to achieve an efficient and sustainable cost structure. Over the past several years, we have substantially lowered our cost structure through reducing our workforce, optimizing technology and maximizing printing, distribution and content efficiencies, all while maintaining profitability at each of our newspapers.

In 2015, we continued regionalizing our audience distribution operations, certain human resource functions and certain administrative functions. We will continue to outsource, regionalize and consolidate legacy operations to achieve a more streamlined and efficient cost structure. In January 2015, we named a new corporate director of production responsible for all production services across the Company. The corporate production director continued to further regionalize production operations. These moves resulted in cost savings, whilegiving our operating executives in our markets the ability to focus more of their time on our growing digital and direct marketing media businesses.

As of December 27, 2015,  16of our 29 of our newspapers are printed through outsourcing arrangements with nearby newspapers owned by us or other companies. In other cases we in‑source the printing of nearby newspapers from other companies to maximize the use of our existing press capacity and generate additional revenues.

We also believe using technology is an important component of our ability to continue to operate cost‑effectively and to invest in our business for the future. Much of that technology is employed behind the scenes with a digital publishing system that can distribute news content to any number of platforms and new enterprise-wide systems to support audience and advertising in the digital environment.

Other Operational Information

Each of our media companies is largely autonomous in its local advertising and editorial operations in order to meet most effectively the needs of the particular community it serves. However, during 2015we reengineered our operations across our local media companies to strengthen areas driving performance in news, audience, advertising and digital growth.

We have two operating segments that are aggregated into a single reportable segment. Each operating segment consists primarily of a group of local media companies with similar economic characteristics, products, customers and distribution methods. Both operating segments report to the same segment manager. Effective July 1, 2015, one of our operating segments (“Western Segment”) consists of our newspaper operations in California, the Northwest and the Midwest, while the other operating segment (“Eastern Segment”) consists primarily of newspaper operations in the Southeast and Florida.There was no change to our single reportable segment as a result of the changes to our operating segments. Publishers of each of the media companies make the day‑to‑day decisions and report to the segment manager, whois responsible for implementing the operating and financial plans at each operation within the respective operating segment. The corporate managers, including executive officers, set the basic business, accounting, financial and reporting policies.

As noted previously under “Focusing on Cost Efficiencies While Investing for the Future,” our media companies also work together to consolidate functions and share resources regionally and across operating segments that lend themselves to such efficiencies, such as certain regional or national sales efforts, accounting functions, digital publishing systems and products, information technology functions and others. Our corporate advertising department is headed by a vice president of advertising who works with our largest advertisers in placing advertising across our operating segments’ print and online products. These efforts are often coordinated through the vice president of operations and corporate personnel.

Our business is somewhat seasonal, with peak revenues and profits generally occurring in the second and fourth quarters of each year, reflecting the spring holidays and the Thanksgiving and Christmas holidays, respectively. The first and third quarters, when holidays are not prevalent, are historically the slowest quarters for revenues and profits.

6

The following table summarizes our media companies, their digital platforms, newspaper circulation and total unique visitors:

			Circulation (1)		Total
Media Company	Website	Location	Daily	Sunday	UV (2)
The Sacramento Bee	www.sacbee.com	Sacramento, CA	166,155	282,719	3,784,000
Star-Telegram	www.star-telegram.com	FortWorth, TX	203,361	260,337	2,690,000
The Kansas City Star	www.kansascity.com	Kansas City, MO	157,661	241,831	3,752,000
The Charlotte Observer	www.charlotteobserver.com	Charlotte, NC	113,235	156,839	5,335,000
Miami Herald	www.miamiherald.com	Miami, FL	114,192	161,344	10,632,000
TheNews & Observer	www.newsobserver.com	Raleigh, NC	105,382	146,463	2,100,000
The Fresno Bee	www.fresnobee.com	Fresno, CA	89,936	139,061	1,257,000
Lexington Herald-Leader	www.kentucky.com	Lexington, KY	64,525	87,530	2,129,000
TheNews Tribune	www.thenewstribune.com	Tacoma, WA	57,327	115,760	1,228,000
The Wichita Eagle	www.kansas.com	Wichita, KS	49,004	103,041	1,366,000
TheState	www.thestate.com	Columbia, SC	52,277	111,786	2,092,000
The Modesto Bee	www.modbee.com	Modesto, CA	51,460	81,294	853,000
El Nuevo Herald	www.elnuevoherald.com	Miami, FL	42,495	58,394	2,215,000
Idaho Statesman	www.idahostatesman.com	Boise, ID	40,921	59,763	996,000
BellevilleNews-Democrat	www.bnd.com	Belleville, IL	33,523	65,848	765,000
TheTelegraph	www.macon.com	Macon, GA	28,578	39,369	989,000
TheSun News	www.thesunnews.com	Myrtle Beach, SC	29,576	39,424	698,000
TheTribune	www.sanluisobispo.com	San Luis Obispo, CA	27,281	38,308	593,000
Sun Herald	www.sunherald.com	Biloxi, MS	25,547	37,323	820,000
The BradentonHerald	www.brandenton.com	Bradenton, FL	25,913	34,355	1,082,000
Ledger-Enquirer	www.ledger-enquirer.com	Columbus, GA	22,995	29,382	661,000
Tri-CityHerald	www.tri-cityherald.com	Kennewick, WA	23,717	37,089	665,000
The Island Packet	www.islandpacket.com	Hilton Head, SC	17,982	20,035	565,000
The Olympian	www.theolympian.com	Olympia, WA	17,764	34,740	504,000
TheHerald	www.heraldonline.com	Rock Hill, SC	15,696	18,782	697,000
Centre Daily Times	www.centredaily.com	State College, PA	14,640	19,727	613,000
The BellinghamHerald	www.bellinghamherald.com	Bellingham, WA	14,573	18,114	570,000
MercedSun-Star	www.mercedsunstar.com	Merced, CA	13,723	N/A	319,000
The Beaufort Gazette	www.beaufortgazette.com	Beaufort, SC	6,234	6,609	N/A	(3)
McClatchy DC Bureau	www.mcclatchydc.com		N/A	N/A	697,000
			1,625,673	2,445,267	50,667,000

⁽¹⁾ Circulation figures are reported as of the end of our fiscal year and are not meant to reflect Alliance for Audited Media (“AAM”) reported figures.

⁽²⁾ Total monthly unique visitors for December 2015 according to Adobe Analytics.

⁽³⁾ The Beaufort Gazette unique visitor activity is included inThe Island Packet activity.

Other Operations

We also have ownership interests and investments in unconsolidated companies and joint ventures. This includes ownership interests in digital assets, including 15.0% of CareerBuilder, LLC, which operates the nation’s largest online job website, CareerBuilder.com; 33.3% of HomeFinder, LLC, which operates the online real estate website HomeFinder.com; as well as certain other digital company investments. Our ownership interests and investments in unconsolidated companies and joint ventures provided us with $7.5 million of cash distributions in 2015. In addition, in early 2015, we received $7.5 million from Classified Ventures (see below) as a result of a final cash distribution anda $0.6 million final working capital adjustment.

During the second quarter of 2014, Classified Ventures sold its Apartments.com business. During the fourth quarter of 2014, we sold our ownership interest in Classified Ventures, which operated the classified website Cars.com. Upon closing this transaction, we entered into a new, five-year affiliate agreement with Cars.com that will allow us to continue to sell Cars.com products and services exclusively in our local markets. 

We own 49.5% of the voting stock and 70.6% of the nonvoting stock of The Seattle Times Company. The Seattle Times Company owns The Seattle Times newspaper, weekly newspapers in the Puget Sound area and daily newspapers located in Walla Walla and Yakima, Washington, and all of their related websites and mobile applications.

In addition, we own a 27.0% interest in Ponderay Newsprint Company (“Ponderay”), a general partnership, that owns and

7

operates a newsprint mill in the state of Washington.

Raw Materials

During 2015 we consumed approximately 99,000 metric tons of newsprint for our operations compared to 121,000 metric tons in 2014. The decrease in tons consumed was primarily due to changes in our print products at numerous newspapers, as well aslower print advertising sales and print circulation volumes. We estimate that we will use approximately 86,000 metric tons of newsprint in 2016, depending on the level of print advertising, circulation volumes and other business considerations.

We currently obtain newsprint from Ponderay,  as well as a number of other suppliers, primarily under long‑term contracts. We purchased approximately 18,200 metric tons of newsprint from Ponderay in 2015.

Our earnings are sensitive to changes in newsprint prices. Newsprint expense accounted for 5.7% of total operating expenses, excluding impairments, in 2015 and 7.1% in 2014.  

Competition

Our newspapers, direct marketing programs, websites and mobile content compete for advertising revenues and readers’ time with television, radio, other websites, direct mail companies, free shoppers, suburban neighborhood and national newspapers and other publications, and billboard companies, among others. In some of our markets, our newspapers also compete with other newspapers published in nearby cities and towns. Competition for advertising is generally based upon print readership levels and demographics, advertising rates, internet usage and advertiser results, while competition for circulation and readership is generally based upon the content, journalistic quality, service, competing news sources and the price of the newspaper.

Our major daily newspapers are the primary general circulation newspaper in each of their respective markets. However, in recent years, newspapers have experienced difficulty maintaining or increasing print circulation levels because of a number of factors. These include increased competition from other publications and other forms of media technologies available in various markets, including the internet and other new media formats that are often free for users; and a  proliferation of news outlets that fragments audiences. In addition, while our newspaper internet sites are generally the leading local websites in each of our major daily newspaper markets, based upon research conducted by us and various independent sources, we have noted changes in readership trends, including a shift of readers to digital media and mobile devices, and have continued to experience a shift of advertising to digital advertising. We face greater competition, particularly in the areas of employment, automotive and real estate advertising, from online competitors. To address the structural shift to digital media, we reengineered our operations to strengthen areas driving performance in news, audience, advertising and digital growth. Our newsroomsalso provide editorial content on a wide variety of platforms and formats from our daily newspaper to leading local websites; on social network sites such as Facebook and Twitter; on smartphones and on e‑readers; on websites and blogs; in niche online publications and in e‑mail newsletters; through RSS (rich site summary) feeds and mobile applications.  Upgradesare continually madeto our mobile apps and websites. In addition, our websites offer leading digital classified products such as CareerBuilder.com, Cars.com and HomeFinder.com. We also operate dealsaver®, our proprietary daily deals service, in nearlyall of our markets.

Employees — Labor

As of December 27, 2015, we had approximately 5,600 full and part‑time employees (equating to approximately 5,100 full‑time equivalent employees), of whom approximately 6.8% were represented by unions. Most of our union‑represented employees are currently working under labor agreements with expiration dates through 2017. We have no unions at 21 of our 29 daily newspapers.

While our newspapers have not had a strike for decades, and we do not currently anticipate a strike occurring, we cannot preclude the possibility that a strike may occur at one or more of our newspapers when future negotiations take place. We believe that in the event of a newspaper strike we would be able to continue to publish and deliver to subscribers, a capability that is critical to retaining revenues from advertising and audience, although there can be no assurance that we will be able to continue to publish in the event of a strike.

8

Compliance with Environmental Laws

We use appropriate waste disposal techniques for items such as ink and other hazardous materials. As of December 27, 2015, we have $1.0 million in a letter of credit shared among various state environmental agencies and the U.S. Environmental Protection Agency to provide collateral related to existing or previously removed storage tanks. However, we do not believe that we currently have any significant environmental issues and in 2015, 2014 and 2013 had no significant expenses or capital expenditures related to environmental control facilities.

Available Information

Our Annual Report on Form 10‑K, Quarterly Reports on Form 10‑Q, Current Reports on Form 8‑K, and amendments to reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are made available, free of charge, on our website at www.mcclatchy.com,  as soon as reasonably practicable after we file or furnish them with the U.S. Securities and Exchange Commission (the “SEC”).

ITEM 1A.  RISK FACTORS

We have significant competition in the market for news and advertising, which may reduce our advertising and audience revenues in the future.

Our primary source of revenues is advertising, followed by audience. The competition we face in the advertising industry generally results from  an increasing number of digital media options available on the internet, which are expanding advertiser and consumer choices significantly, including social networking tools and mobile and other devices distributing news and other content. Faced with a multitude of media choices and a dramatic increase in accessible information, consumers may place greater value on when, where, how and at what price they consume digital content than they do on the source or reliability of such content. News aggregation websites and customized news feeds (often free to users) may reduce our traffic levels by minimizing the need for the audience to visit our websites or use our digital applications directly. Online traffic is also driven by internet search results; therefore, such results are critical to our ability to compete successfully. Search engines frequently update and change the methods for directing search queries to web pages or change methodologies and metrics for valuing the quality and performance of internet traffic on delivering cost‑per‑click advertisements. The failure to successfully manage search engine optimization efforts across our businesses could result in significant decreases in traffic to our various websites, which could result in substantial decreases in conversion rates and repeat business, as well as increased costs if we were to replace free traffic with paid traffic, any or all of which could adversely affect our business, financial condition and results of operations. If traffic levels stagnate or decline, we may not be able to create sufficient advertiser interest in our digital businesses or to maintain or increase the advertising rates of the inventory on our digital platforms. This increased competition for our advertisers and consumers has had and is expected to continue to have an adverse effect on our business and financial results, including negatively impacting revenues and operating income.

Our advertising revenues may decline due to weak general economic and business conditions.

Our advertising revenuesare dependent on general economic and business conditions. Certain aspects of the U.S. economy continue to bechallenging in some of our markets. Many traditional retail companies also face greater competition from online retailers and have faced uncertainty in their businesses, affecting their advertising spending. These challenging economic and business conditions have had and may continue to have an adverse effect on our advertising revenues. To the extent these economic conditions continue or worsen,our business and advertising revenues could be further adversely affected, which could negatively impact our operations and cash flows and our ability to meet the covenants in our debt agreements. Our advertising revenues will be particularly adversely affected if advertisers respond to weak and uneven economic conditions or online competition by continuing to reduce their budgets or shift spending patterns or priorities, or if they are forced to consolidate or cease operations. Consolidation across various industries may also reduce our overall advertising revenues. In addition, seasonal variations in consumer spending cause our quarterly advertising revenues to fluctuate. Advertising revenues in the second and fourth quarters, which contain more holidays, are typically higher than in the first and third quarters, in which economic activity is generally slower. If general economic conditions and other factors cause a decline in revenues, particularly during the second or fourth quarters, we may not be able to increase or maintain our revenues for the year, which would have an adverse effect on our business and financial results.

9

To remain competitive, we must be able to respond to and exploit changes in technology, services and standards and changes in consumer behavior. Significant capital investments may be required.

Technology in the media industry continues to evolve rapidly. Advances in technology have led to an increasing number of methods for delivery of news and other content and have resulted in a wide variety of consumer demands and expectations, which are also rapidly evolving. For example, the number of people who access online services through devices other than personal computers, including smartphones, handheld tablets and mobile devices has increased dramatically in the past several years and is projected to continue to increase. If we are unable to exploit new and existing technologies to distinguish our products and services from those of our competitors or adapt to new distribution methods that provide optimal user experiences, our business and financial results may be adversely affected.

Technological developments also pose other challenges that could adversely affect our revenues and competitive position. New delivery platforms may lead to pricing restrictions, the loss of distribution control and the loss of a direct relationship with consumers. We may also be adversely affected if the use of technology developed to block the display of advertising on websites proliferates. We have noted changes in readership trends, including a shift of readers to mobile devices. A continued shift of readership to mobile devices without a corresponding increase in mobile advertising revenues could adversely affect our results in the future.

Technological developments and any changes we make to our business model may require significant capital investments. We may be limited in our ability to invest funds and resources in digital products, services or opportunities and we may incur costs of research and development in building and maintaining the necessary and continually evolving technology infrastructure. Some of our existing competitors and new entrants may have greater operational, financial and other resources or may otherwise be better positioned to compete for opportunities and as a result, our digital businesses may be less successful, which could adversely affect our business and financial results.

If we are not successful in growing and managing our digital businesses, our business, financial condition will be adversely affected.

Our future growth depends to a significant degree upon the development and management of our digital businesses. The growth of our digital businesses over the long term depends on various factors, including, among other things, the ability to:

· continue to increase digital audiences;

· attract advertisers to our digital products;

· tailor our product for mobile devices;

· maintain or increase the advertising rates on our digital products;

· exploit new and existing technologies to distinguish our products and services from those of competitors and develop new content, products and services; and

· invest funds and resources in digital opportunities.

In addition, we expect that our digital business will continue to increase as a percentage of our total revenues in future periods. For 2015, digital advertising revenues comprised 26.2% of total advertising revenues compared to 23.7% in 2014.  Digital‑only advertising revenues increased 2.9% in 2015 compared to a decline of 10.5% in2014that resulted fromthe change to net revenue accounting for certain digital advertising contracts in 2014 and the sale of Apartments.com by Classified Ventures in April 2014. Total digital‑only, which includes digital‑only revenues from advertising and audience, was up 4.7% in 2015 compared to being down 9.3% in2014, also resulting from the change to net revenue accounting for certain digital advertising contracts and the sale of Apartments.com in 2014. As our digital business becomes a greater portion of our overall business, we will face a number of increased risks from managing our digital operations, including, but not limited, to the following:

· structuring our sales force to effectively sell advertising in the digital advertising arena versus our historical

10

print advertising business;

· attracting and retaining employees with the skill sets and knowledge base needed to successfully operate in digital business; and

· managing the transition to a digital business from a historical print-focused business and the need to concurrently reduce the physical infrastructure, distribution infrastructure and related fixed costs associated with the historical print business.

If we are unable to execute cost‑control measures successfully, our total operating costs may be greater than expected, which may adversely affect our profitability.

As a result of adverse general economic and business conditions and our operating results, we have taken steps to lower operating costs by reducing workforce, consolidating or regionalizing operations and implementing general cost‑control measures. If we do not achieve expected savings from these initiatives, or if our operating costs increase as a result of these initiatives, our total operating costs may be greater than anticipated. These cost‑control measures may also affect our business and our ability to generate future revenue. Because portions of our expenses are fixed costs that neither increase nor decrease proportionately with revenues, we are limited in our ability to reduce costs in the shortterm to offset any declines in revenues. If these cost‑control efforts do not reduce costs sufficiently or otherwise adversely affect our business, income from continuing operations may decline.

Difficult business conditions in the economy generally and in our industry or changes to our business and operations may result in goodwill and masthead impairment charges.

Due to business conditions, including lower revenues and operating cash flow, we recorded goodwill impairment charges of $290.9 million and masthead impairment charges of $13.9 million in 2015. We also recorded masthead impairment charges of $5.2 million $5.3 million, $2.8 million and $59.6 million in 2014, 2013, 2011 and 2008, respectively, and $3.0 billion of goodwill and masthead impairment charges in 2007. As of December 27, 2015, we have goodwill of $705.2 million and mastheads of $179.1 million. Further erosion of general economic, market or business conditions could have a negative impact on our business and stock price, which may require that we record additional impairment charges in the future, which negatively affects our results of operations.

Our business, reputation and results of operations could be negatively impacted by data security breaches and other security threats and disruptions.

Certain network and information systems are critical to our business activities. Network and information systems may be affected by cyber security incidents that can result from deliberate attacks or system failures. Threats include, but are not limited to, computer hackings, computer viruses, worms or other destructive or disruptive software, or other malicious activities. Our security measures may also be breached due to employee error, malfeasance, or otherwise. As a result of these breaches, an unauthorized party may obtain access to our data or our users’ data or our systems may be compromised. These events evolve quickly and often are not recognized until after an attack is launched, so we may be unable to anticipate these attacks or to implement adequate preventative measures. Our network and information systems may also be compromised by power outages, fire, natural disasters, terrorist attacks, war or other similar events. There can be no assurance that the actions, measures and controls we have implemented will be sufficient to prevent disruptions to mission critical systems, the unauthorized release of confidential information or corruption of data. Although we have experienced cyber security incidents, to date none has had a material impact on our financial condition, results of operations or liquidity. Nonetheless, these types of events are likely to occur in the future and such events could disrupt our operations or other third party information technology systems in which we are involved. A significant breakdown, invasion, corruption, destruction or interruption of critical information technology systems, or infrastructure by employees, others with authorized access to our systems, or unauthorized persons could result in legal or financial liability or otherwise negatively impact our operations. They also could require significant management attention and resources, and could negatively impact our reputation among our customers, advertisers and the public, which could have a negative impact on our financial condition, results of operations or liquidity.

11

We are subject to significant financial risk as a result of our $937 million in total consolidated debt.

As of December 27, 2015, we had approximately $937.3 million in total principal indebtedness outstanding. This level of debt increases our vulnerability to general adverse economic and industry conditions and we may need to refinance our debt prior to its scheduled maturity. Higher leverage ratios, our credit ratings, our economic performance, adverse financial markets or other factors could adversely affect our future ability to refinance maturing debt on commercially acceptable terms, or at all, or the ultimate structure of such refinancing.

Covenants in the indenture governing the notes and our other existing debt agreements will restrict our business.

The indenture governing our 9.00% Senior Secured Notes due in 2022 (the “9.00% Notes”) and our secured credit agreement contain various covenants that limit, subject to certain exceptions, our ability and/or our restricted subsidiaries’ ability to, among other things:

· incur or assume liens;

· incur additional debt or provide guarantees in respect of obligations of other persons;

· issue redeemable stock and preferred stock;

· pay dividends or make distributions on capital stock, repurchase, redeem or make payments on capital stock or prepay, repurchase, redeem, retire, defease, acquire or cancel certain of our existing notes or debentures prior to the stated maturity thereof;

· make loans, investments or acquisitions;

· create or permit restrictions on the ability of our subsidiaries to pay dividends or make other distributions to us or to guarantee our debt, limit our or any of our subsidiaries’ ability to create liens, or make or pay intercompany loans or advances;

· enter into certain transactions with affiliates;

· sell, transfer, license, lease or dispose of our or our subsidiaries’ assets, including the capital stock of our subsidiaries; and

· dissolve, liquidate, consolidate or merge with or into, or sell substantially all the assets of us and our subsidiaries, taken as a whole, to, another person.

The restrictions contained in the indenture governing the 9.00% Notes and the secured credit agreement could adversely affect our ability to:

· finance our operations;

· make needed capital expenditures;

· dispose of assets

· make strategic acquisitions or investments or enter into alliances;

· withstand a future downturn in our business or the economy in general;

· refinance our outstanding indebtedness prior to maturity;

· engage in business activities, including future opportunities, that may be in our interest; and

12

· plan for or react to market conditions or otherwise execute our business strategies.

Our ability to comply with covenants contained in the indenture for the 9.00% Notes and our secured credit agreement may be affected by events beyond our control, including prevailing economic, financial and industry conditions. Even if we are able to comply with all of the applicable covenants, the restrictions on our ability to manage our business in our sole discretion could adversely affect our business by, among other things, limiting our ability to take advantage of financings, mergers, acquisitions and other corporate opportunities that we believe would be beneficial to us. In addition, our obligations under the 9.00% Notes and the secured credit agreement are secured, subject to permitted liens, on a first‑priority basis, and in the event of default such security interests could be enforced by the collateral agent for the secured credit agreement. In the event of such enforcement, we cannot assure you that the proceeds from the enforcement would be sufficient to pay our obligations under the 9.00% Notes or secured credit agreement or at all.

We have significant financial obligations and in the future we will need cash to repay our existing indebtedness and meet our other obligations. Our inability to generate sufficient cash to pay our obligations would adversely affect our business.

We may not be able to generate sufficient cash internally to repay all of our indebtedness at maturity or to meet our other obligations. As of December 27, 2015, we had approximately $937.3 million of total indebtedness outstanding and approximately $33.0 million in face amount of letters of credit outstanding under the Collateralized Issuance and Reimbursement Agreement. Of the $937.3million aggregate principal amount outstanding as of December 27, 2015, we have approximately $55.5 million of notes with an interest rate of 5.750% due in 2017; $516.4 million of 9.00% Notes due in 2022; approximately $89.2 million of debentures with an interest rate of 7.150% due in 2027 and approximately $276.2 million of debentures with an interest rate of 6.875% due in 2029.

As of December 27, 2015, the projected benefit obligations of our qualified defined benefit pension plan (“Pension Plan”) exceeded Pension Plan assets by $464.8 million. In February 2016, we contributed company-owned real property valued at $47.1 million to our Pension Plan that will exceed our 2016 funding requirements and will reduce future pension contributions and expense.  Future contributions are subject to numerous assumptions, including, among others, changes in interest rates, returns on assets in the Pension Plan and future government regulations. In addition, we have a limited number of supplemental retirement plans, which provide certain key employees with additional retirement benefits. These plans have no assets; however as of December 27, 2015, our projected benefit obligation of these plans was $116.9 million. These plans are on a pay‑as‑you‑go basis.

Our ability to make payments on and to refinance our indebtedness, including the 9.00% Notes and our other series of outstanding notes, to make required contributions to the Pension Plan, to fund the supplemental retirement plans and to fund working capital needs and planned capital expenditures will depend on our ability to generate cash in the future. Our ability to generate cash, to a certain extent, is subject to general economic, financial, competitive, business, legislative, regulatory and other factors that are beyond our control.

If our business does not generate sufficient cash flow from operations or if future borrowings are not available to us in an amount sufficient to enable us to pay our indebtedness, including the 9.00% Notes and our other series of outstanding notes or to fund our other liquidity needs, we may need to refinance all or a portion of our indebtedness, on or before the maturity thereof, reduce or delay capital investments or seek to raise additional capital, any of which could have a material adverse effect on our operations. In addition, we may not be able to affect any of these actions, if necessary, on commercially reasonable terms or at all. Our ability to restructure or refinance our indebtedness will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations or our ability to refinance our existing debt. The terms of existing or future debt instruments, including the indenture governing the 9.00% Notes and the secured credit agreement, may limit or prevent us from taking any of these actions. In addition, any failure to make scheduled payments of interest and principal on our outstanding indebtedness would likely result in a reduction of our credit rating, which could harm our ability to incur additional indebtedness on commercially reasonable terms or at all. Our inability to generate sufficient cash flow to satisfy our debt service obligations, or to refinance or restructure our obligations on commercially reasonable terms or at all, would have an adverse effect, which could be material, on our business, financial condition and results of operations, as well as on our ability to satisfy our obligations with respect to our outstanding debt.

13

We may be required to make greater contributions to our qualified defined benefit pension plans in the next several years than previously required, placing greater liquidity needs upon our operations.

The projected benefit obligations of the Pension Plan exceeded Pension Plan assets by $464.8 million as of December 27, 2015, an increase of $20.5 million from December 28, 2014, primarily due to unfavorable asset performance partially offset by a favorable change in the discount rate. The value of the Pension Plan assets fluctuates based on many factors, including changes in interest rates and market returns. In February 2016, we contributed company-owned real property valued at $47.1 million to our Pension Plan that will exceed our 2016 funding requirements and will reduce future pension contributions and expense, all other things being equal.

The excess of benefit obligations over pension assets is expected to give rise to required pension contributions over the next several years. Over the last several years federal legislation has provided for pension funding relief in the form of mandated changes in the discount rates used to calculate the projected benefit obligations for purposes of funding pension plans. Recent new legislation and calculations use historical averages of long‑term highly‑rated corporate bonds (within ranges as defined in the legislation) which have an impact of applying a higher discount rate to determine the projected benefit obligations for funding and current long‑term interest rates, but also mandated increases in fees paid to the Pension Benefit Guaranty Corporation, also known as the PBGC, based in part on the level of underfunding in various company’s’ qualified defined pension plans. Even with the relief provided by these legislative rules, we expect future contributions to be required. In addition, adverse conditions in the capital markets and/or lower long‑term interest rates may result in greater annual contribution requirements, placing greater liquidity needs upon our operations.

We require newsprint for operations and, therefore, our operating results may be adversely affected if the price of newsprint increases or if we experience disruptions in our newsprint supply chain.

Newsprint is the major component of our cost of raw materials. Newsprint accounted for 5.7% of our operating expenses, excluding impairments, in 2015 compared to 7.1% in 2014. Accordingly, our earnings are sensitive to changes in newsprint prices. The price of newsprint has historically been volatile and may increase as a result of various factors, including:

· declining newsprint supply from mill closures;

· reduction in newsprint suppliers because of consolidation in the newsprint industry;

· paper mills reducing their newsprint supply because of switching their production to other paper grades; and

· a decline in the financial situation of newsprint suppliers.

We have not attempted to hedge price fluctuations in the normal purchases of newsprint or enter into contracts with embedded derivatives for the purchase of newsprint other than the natural hedge created by our ownership interest in Ponderay. If the price of newsprint increases materially, our operating results could be adversely affected. In addition, we rely on a limited number of suppliers for deliveries of newsprint. If newsprint suppliers experience labor unrest, transportation difficulties or other supply disruptions, our ability to produce and deliver newspapers could be impaired and/or the cost of the newsprint could increase, both of which would negatively affect our operating results.

A portion of our employees are members of unions, and if we experience labor unrest, our ability to produce and deliver newspapers could be impaired.

If we experience labor unrest, our ability to produce and deliver newspapers could be impaired in some locations. In addition, the results of future labor negotiations could harm our operating results. Our newspapers have not experienced a labor strike for decades. However, we cannot ensure that a strike will not occur at one or more of our newspapers in the future. As of December 27, 2015,  approximately 6.8% of full‑time and part‑time employees were represented by unions. Most of our union‑represented employees are currently working under labor agreements, with expiration dates through 2017. We face collective bargaining upon the expirations of these labor agreements. Even if our newspapers do not suffer a labor strike, our operating results could be harmed if the results of labor negotiations restrict our ability to maximize the efficiency of our newspaper operations. In addition, our ability to make short‑term adjustments to control compensation and benefits costs, rebalance our portfolio of businesses or otherwise adapt to changing business needs may be limited by the terms and duration of our collective bargaining agreements.

14

We have invested in certain digital ventures, but such ventures may not be as successful as expected, which could adversely affect our results of operations.

We continue to evaluate our business and make strategic investments in digital ventures, either alone or with partners, to further our digital growth. We have, among others, investments with other partners in CareerBuilder LLC, which operates the nation’s largest online job website, CareerBuilder.com, and HomeFinder LLC, which operates the real estate website HomeFinder.com, as well as certain other digital company investments. The success of these ventures is dependent to an extent on the efforts of our partners. Further, our ability to monetize the investments and/or the value we may receive upon any disposition may depend on the actions of our partners. As a result, our ability to control the timing or process relating to a disposition may be limited, which could adversely affect the liquidity of these investments or the value we may ultimately attain upon disposition. If the value of the companies in which we invest declines, we may be required to record a charge to earnings. There can be no assurances that we will receive a return on these investments or that they will result in advertising growth or will produce equity income or capital gains in future years.

Circulation volume declines could adversely affect our print audience and print advertising revenues, and audience price increases could exacerbate declines in circulation volumes.

Print advertising and audience revenues are affected by circulation volumes and readership levels of our newspapers. In recent years, newspapers have experienced difficulty maintaining or increasing print circulation levels because of a number of factors, including:

· increased competition from other publications and other forms of media technologies available in various markets, including the internet and other new media formats that are often free for users;

· continued fragmentation of media audiences;

· a growing preference among some consumers to receive all or a portion of their news online or other than from a newspaper;

· increases in subscription and newsstand rates; and

· declining discretionary spending by consumers affected by negative economic conditions.

These factors could also affect our newspapers’ ability to institute circulation price increases for print products. Also, print price increases have historically had an initial negative impact on circulation volumes that may not be mitigated with additional marketing and promotion. A prolonged reduction in circulation volumes would have a material adverse effect on advertising revenues. To maintain our circulation base, we may be required to incur additional costs that we may not be able to recover through audience and advertising revenues.

We rely on third party vendors for various services and if any of those third parties fail to fulfill their obligations to us with quality and timeliness we expect, or if our relationship with such vendors is damaged, our business may be harmed.

We rely on third party vendors to provide various services such as printing, distribution and production, as well as information technology systems. We do not control the operation of these vendors. If any of these third party vendors terminate their relationship with us, or donot provide an adequate level of service, it would be disruptive to our business as we seek to replace the vendor or remedy the inadequate level of service. This disruption may adversely affect our operating results.

15

Developments in the laws and regulations to which we are subject may result in increased costs and lower advertising revenues from our digital businesses.

We are generally subject to government regulation in the jurisdictions in which we operate. In addition, our websites are available worldwide and are subject to laws regulating the internet both within and outside the United States. We may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply. Advertising revenues from our digital businesses could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to the use of consumer data in digital media.

Adverse results from litigation or governmental investigations can impact our business practices and operating results.

In the ordinary course of business, we and our subsidiaries are parties to litigation and regulatory, environmental and other proceedings with governmental authorities and administrative agencies. For example, we are currently involved in two class action lawsuits that are described further in Note 9, Commitments and Contingencies to the consolidated financial statements.  Adverse outcomes in lawsuits or investigations could result in significant monetary damages or injunctive relief that could adversely affect our operating results or financial condition as well as our ability to conduct our business as it is presently being conducted.  

We were notified by the New York Stock Exchange (“NYSE”) that we did not meet its continued listing requirements, and we potentially face delisting if we do not comply with NYSE standards.

We received notification from the NYSE on February 16, 2016, that we are not in compliance with the NYSE’s continued listing standard requiring that our stock trade at a minimum average closing price of $1.00 for thirty consecutive trading days. Under the NYSE rules, we have until August 16, 2016 (the “compliance date”) to comply with the listing standard. We have a plan in place that we believe will allow us to address the average stock price deficiency by the compliance date. If we are unable to regain compliance with the NYSE listing requirements, our Class A common stock will be delisted from the NYSE, and, as a result, we would likely have our Class A common stock quoted on the Over-the-Counter Bulletin Board (“OTC BB”). Securities that trade on the OTC BB generally have less liquidity and greater volatility than securities that trade on the NYSE. In addition, because issuers whose securities trade on the OTC BB are not subject to the corporate governance and other standards imposed by the NYSE, our reputation may suffer, which could result in a decrease in the trading price of our shares. The market price of our Class A common stock has historically fluctuated and is likely to fluctuate in the future.

ITEM 1B.  UNRESOLVED STAFF COMMENTS

None

ITEM 2.  PROPERTIES

Our corporate headquarters are located at 2100 Q Street, Sacramento, California. At December 27, 2015, we had newspaper production facilities in 13 markets in 11 states. Our facilities vary in size and in total occupy about 5.5 million square feet. Approximately 1.8 million of the total square footage is leased from others, while we own the properties for the remaining square footage. We own substantially all of our production equipment, although certain office equipment is leased.

We maintain our properties in good condition and believe that our current facilities are adequate to meet the present needs of our newspapers.

See Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, specifically Recent Developments, regarding discussion of contributed properties to our qualified defined benefit pension plan.

ITEM 3.  LEGAL PROCEEDINGS

See Note 9, Commitments and Contingencies to the consolidated financial statements included as part of this Annual Report on Form 10-K.

16

ITEM 4.  MINE SAFETY DISCLOSURES

None

17

PART II

ITEM 5.  MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Our Class A Common Stock is listed on the New York Stock Exchange (“NYSE”) under the symbol “MNI.” A small amount of Class A Common Stock is also traded on other exchanges. Our Class B Common Stock is not publicly traded. As of February 29, 2016, there were approximately 4,974 and 20 record holders of our Class A and Class B Common Stock, respectively. We believe that the total number of holders of our Class A Common Stock is much higher since many shares are held in street names. The following table lists the high and low prices of our Class A Common Stock as reported by the NYSE for each fiscal quarter of 2015 and 2014:

Fiscal Year 2015 Quarters Ended:	High		Low
March 29, 2015	$	3.48	$	1.75
June 28, 2015	$	1.93	$	1.08
September 27, 2015	$	1.28	$	0.75
December 27, 2015	$	1.64	$	0.93

Fiscal Year 2014 Quarters Ended:	High		Low
March 30, 2014	$	7.39	$	3.30
June 29, 2014	$	7.00	$	4.82
September 28, 2014	$	5.93	$	3.50
December 27, 2015	$	3.95	$	2.84

Dividends:

During 2009, we suspended our quarterly dividend; therefore, we have not paid any cash dividends since the first quarter of 2009. The payment and amount of future dividends remain within the discretion of the Board of Directors and will depend upon our future earnings, financial condition, and other factors considered relevant by the Board of Directors. Our credit agreement prohibits the payment of a dividend if a payment would not be permitted under the indenture for the 9.00% Notes (discussed below). Dividends under the indenture for the 9.00% Notes are allowed if the consolidated leverage ratio (as defined in the indenture) is less than 5.25 to 1.00 and we have sufficient amounts under our restricted payments basket (as defined in the indenture). However, the payment and amount of future dividends remain within the discretion of the Board of Directors and will depend upon our future earnings, financial condition, and other factors considered relevant by the Board of Directors.

Equity Securities:

In April 2015, our Board of Directors authorized a new share repurchase program for the repurchase of up to $7.0 million of our Class A Common Stock through December 31, 2016. This program was further amended in August 2015 to authorize a total of up to $15.0 million to repurchase shares. The shares will be repurchased from time to time depending on prevailing market prices, availability, and market conditions, among other factors.During the year ended December 27, 2015, we repurchased 6.1 million shares at an average price of$1.28 per share.

					(c) Total Number of		(d) Approximate Dollar
	(a) Total Number				Shares Purchased as Part		Value of Shares that May
	of Shares		(b) Average Price		of Publicly Announced		Yet Be Purchased Under
Period	Purchased		Paid per Share		Program		the Program
09/28/2015 - 11/01/2015		1,266,182	$	1.27		3,182,006	$	11,222,632
11/02/2015 - 11/29/2015		1,313,583	$	1.42		4,495,589	$	9,355,972
11/30/2015 - 12/27/2015		1,651,165	$	1.33		6,146,754	$	7,160,379
Total Fourth Quarter 2015		4,230,930	$	1.34		6,146,754	$	7,160,379

During the year ended December 27, 2015, we did not sell any equity securities of the Company, which were not registered under the Securities Act of 1933, as amended.

18

Performance Graph:

The following graph compares the cumulative five‑year total return attained by shareholders on The McClatchy Company’s common stock versus the cumulative total returns of the S&P Midcap 400 index and a customized peer group composed of six companies (“New Peer Group”) and a customized peer group composed of five companies used during the fiscal year ended December 28, 2014, (“Old Peer Group”).

Our New Peer Group is customized to include six companies that are publicly traded with at least 40% of their revenues from newspaper publishing. This peer group includes: A.H. Belo Corp., Gannett Co. Inc., Lee Enterprises, Inc., New Media Investment Group, Inc., The New York Times Company and Tribune Publishing Company. In customizing the New Peer Group we added New Media Investment Group, Inc. and Tribune Publishing Company and removed E.W. Scripps Company from the Old Peer Group. E.W. Scripps Company was removed because it merged with another company.

	Fiscal Years Ended:
	12/26/2010		12/25/2011		12/30/2012		12/29/2013		12/28/2014		12/27/2015
The McClatchy Company	$	100	$	49	$	62	$	70	$	72	$	25
S&P Midcap 400	$	100	$	98	$	116	$	155	$	170	$	166
Old Peer Group (1)	$	100	$	75	$	83	$	162	$	161	$	153
New Peer Group (2)	$	100	$	73	$	79	$	150	$	145	$	123

⁽¹⁾ Old Peer group includes: A.H. Belo Corp., E.W. Scripps Company, Gannett Co. Inc., Lee Enterprises Inc. and New York Times Company

⁽²⁾ New Peer group includes: A.H. Belo Corp., Gannett Co. Inc., Lee Enterprises Inc., New Media Investment Group Inc., The New York Times Company and Tribune Publishing Company

19

ITEM 6.  SELECTED FINANCIAL DATA

The selected financial data set forth below should be read in conjunction with Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” our consolidated financial statements and the related notes, and other financial data included elsewhere in this annual report. Historical results are not necessarily indicative of the results to be expected in future periods.

	December 27,		December 28,		December 29,		December 30,		December 25,
(in thousands, except per share amounts)	2015		2014		2013		2012 (1)		2011
REVENUES — NET:
Advertising	$	637,415	$	731,783	$	822,128	$	895,640	$	936,418
Audience		367,858		366,592		346,311		334,580		339,504
Other		51,301		48,177		46,409		49,624		47,955
		1,056,574		1,146,552		1,214,848		1,279,844		1,323,877
OPERATING EXPENSES:
Other operating expenses		895,470		942,364		955,153		975,525		1,005,700
Depreciation and amortization		101,595		113,638		121,570		124,348		120,384
Asset impairments		304,848		8,227		17,181		—		2,800
		1,301,913		1,064,229		1,093,904		1,099,873		1,128,884
OPERATING INCOME (LOSS)		(245,339)		82,323		120,944		179,971		194,993
NON-OPERATING (EXPENSE) INCOME:
Interest expense		(85,973)		(127,503)		(135,381)		(151,334)		(165,434)
Interest income		331		254		53		88		97
Equity income in unconsolidated companies, net		18,252		26,925		45,680		31,935		27,762
Gains related to equity investments		8,061		705,247		—		—		—
Gain (loss) on extinguishment of debt		1,167		(72,777)		(13,643)		(88,430)		(1,203)
Other — primarily write down of investments and Miami property gain		(8,166)		(7,841)		9,909		—		—
Other — net		(292)		579		541		79		248
		(66,620)		524,884		(92,841)		(207,662)		(138,530)
Income (loss) from continuing operations before income taxes		(311,959)		607,207		28,103		(27,691)		56,463
Income tax provision (benefit)		(11,797)		231,230		11,659		(23,725)		6,023
NET INCOME (LOSS) FROM CONTINUING OPERATIONS		(300,162)		375,977		16,444		(3,966)		50,440
Income (loss) from discontinued operations, net of tax		—		(1,988)		2,359		3,822		3,949
NET INCOME (LOSS)	$	(300,162)	$	373,989	$	18,803	$	(144)	$	54,389
Basic earnings per common share:
Income (loss) from continuing operations	$	(3.47)	$	4.33	$	0.19	$	(0.05)	$	0.59
Discontinued operations, net of tax		—		(0.02)		0.03		0.05		0.05
Net income (loss) per basic common share	$	(3.47)	$	4.31	$	0.22	$	—	$	0.64
Diluted earnings per common share:
Income (loss) from continuing operations	$	(3.47)	$	4.26	$	0.19	$	(0.05)	$	0.59
Discontinued operations, net of tax		—		(0.03)		0.03		0.05		0.04
Net income (loss) per diluted common share	$	(3.47)	$	4.23	$	0.22	$	—	$	0.63
Dividends per common share:	$	—	$	—	$	—	$	—	$	—
CONSOLIDATED BALANCE SHEET DATA:
Total assets (2)	$	1,923,034	$	2,540,716	$	2,577,739	$	2,968,853	$	3,009,851
Long-term debt (2)		905,425		994,812		1,473,460		1,565,458		1,563,873
Financing obligations		32,398		34,551		40,264		279,325		272,795
Stockholders’ equity		192,763		503,385		240,386		42,501		175,187

(1) Due to our fiscal calendar, the year ended on December 30, 2012 encompassed a 53‑week period as compared to the other fiscal year ends identified in this table, which only have 52‑week periods.

In 2015, we early adopted FASB issued Accounting Standards Update (“ASU”) No. 2015-03 and ASU 2015-17 (see Note 1 to our consolidated financial statements). These standards were applied retrospectively and therefore for 2011-2014, we reclassified all of our unamortized debt issuance costs from current assets to be a reduction to long-term debt and we reclassified current deferred income tax assets to noncurrent deferred income tax liabilities on our consolidated balance sheets.

20

ITEM 7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Reference is made to Part I, Item 1 “Forward‑Looking Statements” and Item 1A “Risk Factors,” which describes important factors that could cause actual results to differ from expectations and non‑historical information contained herein. In addition, the following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help the reader understand our results of operations and financial condition. MD&A should be read in conjunction with our audited consolidated financial statements and accompanying notes to the consolidated financial statements (“Notes”) as of and for each of the three years ended December 27, 2015, December 28, 2014, and December 29, 2013 included elsewhere in this Annual Report on Form 10‑K.

Overview

We are a 21st century news and information publisher of well-respected publications such as the Miami Herald, The Kansas City Star, The Sacramento Bee, The Charlotte Observer,  The (Raleigh) News and Observer, and the (Fort Worth) Star-Telegram. We operate media companies in 28 U.S. markets in 14 states, providing each of these communities with high-quality news and advertising services in a wide array of digital and print formats. We are headquartered in Sacramento, California, and our Class A Common Stock is listed on the New York Stock Exchange under the symbol MNI.

We also own 15.0% of CareerBuilder, LLC, which operates the nation’s largest online job website, CareerBuilder.com; 33.3% of HomeFinder, LLC, which operates the online real estate website HomeFinder.com.

Our fiscal year ends on the last Sunday in December. The fiscal years ended December 27, 2015, December 28, 2014, and December 29, 2013 consisted of 52‑week periods.

The following table reflects our sources of revenues as a percentage of total revenues for the periods presented:

	Years Ended
	December 27,		December 28,		December 29,
	2015		2014		2013
Revenues:
Advertising	60.3	%	63.8	%	67.7	%
Audience	34.8	%	32.0	%	28.5	%
Other	4.9	%	4.2	%	3.8	%
Total revenues	100.0	%	100.0	%	100.0	%

Our primary sources of revenues are print and digital advertising. All categories (retail, national and classified) of advertising discussed below include both print and digital advertising. Retail advertising revenues include advertising carried as a part of newspapers (run of press (“ROP”) advertising), advertising inserts placed in newspapers (“preprint advertising”) and/or advertising delivered digitally. Audience revenues include print and digital subscriptions or a combination of both. Our print newspapers are primarily delivered by large distributors and certain newspapers utilize independent contractors. Other revenues include primarily commercial printing and distribution revenues.

See “Results of Operations” section below for a discussion of our revenue performance and contribution by category for the 2015, 2014 and 2013.

Recent Developments

Non-Cash Impairment Charges

Our financial operating results for 2015 include $304.8 million of non-cash impairment charges that reduced our carrying value of goodwill and intangible newspaper mastheads, consisting of $290.9 million for goodwill and $13.9 million for intangible newspaper mastheads.

Debt Repurchases and Extinguishment of Debt

During 2015 we repurchased a total of $95.2 million in aggregate principal amount of our notes through privately

21

negotiated transactions, consisting of $55.8 million of our 5.75% Notes due in 2017 and $39.4 million of our 9.00% Senior Secured Notes (“9.00% Notes”). We recorded a net gain on extinguishment of debt of $1.2 million in 2015.

Share Repurchase Program

In April 2015, our Board of Directors authorized a new share repurchase program for the repurchase of up to $7.0 million of our Class A Common Stock through December 31, 2016. This program was further amended in August 2015 to authorize a total of up to $15.0 million to repurchase shares. The shares are to be repurchased from time to time depending on prevailing market prices, availability, and market conditions, among other factors. As of December 27, 2015, we have repurchased approximately 6.1 million shares at a weighted average price of $1.28 per share, or $7.8 million of the total buyback approved.

Contribution of Company-Owned Real Property to Pension Plan

In February 2016, we contributed certain of our real property appraised at $47.1 million to our qualified defined benefit pension plan consisting of buildings and related land. We are leasing back the properties from our pension plan for 11 years at an aggregate annual rent of approximately $3.5 million. The properties will be managed by an independent fiduciary, and the appraisals and lease payments have been determined by that fiduciary.

We expected our required pension contribution under the Employee Retirement Income Security Act to be approximately $2.0 million in 2016, and the contribution of real property described abovewill satisfy all of our required pension contribution for 2016 and is expected to reduce ourfuture pension contributions and expense, all other things being equal.  See Note 12 for a greater description of this transaction and the “Liquidity and Capital Resources” section below for a discussion of potential future pension contributions.

Investments in Unconsolidated Companies Activity

On April 1, 2014, Classified Ventures sold its Apartments.com business for $585 million. Accordingly, during fiscal year 2014, we recorded our share of the gain on the sale of approximately $144.2 million, before taxes. On April 1, 2014, we received a cash distribution of approximately $146.9 million from Classified Ventures, which was equal to our share of the net proceeds from the sale.

On October 1, 2014, we, along with Tribune Media Company, Graham Holdings Company and A. H. Belo Corporation (the “Selling Partners”) completed the sale of all of the Selling Partners’ ownership interests in Classified Ventures to TEGNA, Inc. (formerly Gannett Co., Inc.) for a price that valued Classified Ventures at $2.5 billion. We recorded a gain on sale of our ownership interest in Classified Ventures of $559.3 million, before taxes, during fourth quarter of fiscal year 2014. Our portion of the cash proceeds, net of transaction costs, was approximately $631.8 million. Pursuant to the sale agreement, $25.6 million of net proceeds was held in escrow until October 1, 2015. On October 1, 2014, we received our portion of the net cash proceeds, less the escrow amount, of $606.2 million. Upon the closing of the transaction, we entered into a new, five-year affiliate agreement with Cars.com that allowed us to continue to sell Cars.com products and services exclusively in our local markets. In the fourth quarter of 2015, we received the $25.6 million escrow balance from the escrow account.

Gains Related to Equity Investments

We recognized $8.1 million in gains related to equity investments during 2015. During the first quarter of 2015, we received $0.6 million from Classified Ventures as a result of the final working capital adjustment from our sale of Classified Ventures in the fourth quarter of 2014. In addition, in April 2015, we received a final cash distribution of $7.5 million from Classified Ventures. Both of these transactions were recorded as gains related to equity investments during 2015, because the company has no continuing ownership interest in Classified Ventures, as discussed above.

Results of Operations

The following table reflects our financial results on a consolidated basis for 2015, 2014 and 2013:

22

	Years Ended
	December 27,		December 28,		December 29,
	2015		2014		2013
Income (loss) from continuing operations	$	(300,162)	$	375,977	$	16,444
Income (loss) from discontinued operations, net of tax		—		(1,988)		2,359
Net income (loss)	$	(300,162)	$	373,989	$	18,803
Net income (loss) per diluted common share:
Income (loss) from continuing operations	$	(3.47)	$	4.26	$	0.19
Income (loss) from discontinued operations		—		(0.03)		0.03
Net income (loss) per share	$	(3.47)	$	4.23	$	0.22

The loss from continuing operations in 2015 is primarily related to non-cash impairment charges of $304.8 million (see Note 4 and theprevious discussion in Recent Developments) and the net income from continuing operations in 2014 was due to several transactions, primarily related to the gains related to the Classified Ventures transaction as described previously in Recent Developments. In addition, as described more fully below, results for 2015 compared to 2014 were impacted by decreases in total revenues, lower equity investment income and our portion of the gains related to equity investments, offset by decreases in operating expenses, interest expense and the extinguishment of debt.

The increase in income from continuing operations in 2014 compared to 2013 is primarily related to gains related to equity investments in 2014, partially offset by losses on extinguishment of debt.

2015 Compared to 2014

Revenues

The following table summarizes our revenues by category, which compares 2015 to 2014:

	Years Ended
	December 27,		December 28,		$		%
(in thousands)	2015		2014		Change		Change
Advertising:
Retail	$	318,953	$	374,425	$	(55,472)	(14.8)
National		45,861		50,796		(4,935)	(9.7)
Classified:
Automotive		37,789		53,025		(15,236)	(28.7)
Real estate		27,083		30,240		(3,157)	(10.4)
Employment		30,120		34,378		(4,258)	(12.4)
Other		58,707		61,227		(2,520)	(4.1)
Total classified		153,699		178,870		(25,171)	(14.1)
Direct marketing and other		118,902		127,692		(8,790)	(6.9)
Total advertising		637,415		731,783		(94,368)	(12.9)
Audience		367,858		366,592		1,266	0.3
Other		51,301		48,177		3,124	6.5
Total revenues	$	1,056,574	$	1,146,552	$	(89,978)	(7.8)

During 2015 total revenues decreased 7.8% compared to 2014 primarily due to the continued decline in demand for print advertising. The largest impact on print advertising came from large retail advertisers who began pulling back preprinted insert advertising and in-newspaper ROP advertising in 2015. In addition, advertisers’ desire to reach online customers and the secular shift in advertising demand from print to digital products, which are widely available from many media competitors and are generally sold at lower prices than print products, contributed to the decline in print advertising revenues. In addition, the decreases in total advertising revenues were also a result of higher wholesale costs associated with purchasing certain digital products and services, which are recorded as a reduction to the related revenues, as described below. The declines in total advertising revenues were partially offset by an increase in our audience revenues, due primarily to increases in pricing and sales of our subscription products, as well as an increase in other revenues.

Advertising Revenues

Total advertising revenues decreased 12.9% in 2015 compared to 2014. While we experienced declines in all of our advertising revenue categories, including certain digital advertising revenue categories, the decrease in total advertising revenues was primarily related to declines in print retail and print and digital classified advertising revenues. These

23

decreases in advertising revenues were partially offset by increases in certain digital revenue categories, as discussed below. The decreases are also partially a result of the five-year affiliate agreement we entered into with Cars.com on October 1, 2014, which resulted in higher wholesale costs related to their digital products and services in 2015. These wholesale costs are recorded as a reduction in the related revenues for these products and services, and generally reduce total advertising revenues by approximately two percentage points due to the higher costs in the new affiliate agreement in 2015 compared to prior years.

Newspaper advertising is typically display advertising, or in the case of classified, display and/or liner advertising, while digital advertising can be in the form of display, coupon or banner ads, video, search advertising and/or liner ads. Advertising printed directly in the newspaper is considered ROP advertising while preprint advertising consists of preprinted advertising inserts delivered with the newspaper.

The following table reflects the category of advertising revenues as a percentage of total advertising revenues for the periods presented:

	Years Ended
	December 27,		December 28,
	2015		2014
Advertising:
Retail	50.0	%	51.2	%
National	7.2	%	6.9	%
Classified	24.1	%	24.4	%
Direct marketing and other	18.7	%	17.5	%
Total advertising	100.0	%	100.0	%

We categorize advertising revenues as follows:

· Retail – local retailers, local stores of national retailers, department and furniture stores, restaurants and other consumer‑related businesses. Retail advertising also includes revenues from preprinted advertising inserts distributed in the newspaper.

· National – national and major accounts such as telecommunications companies, financial institutions, movie studios, airlines and other national companies.

· Classified – local auto dealers, employment, real estate and other classified advertising, which includes remembrances, legal advertisements and other miscellaneous advertising.

· Direct Marketing and Other – primarily preprint advertisements in direct mail, shared mail and niche publications, events programs total market coverage publications and other miscellaneous advertising not included in the daily newspaper.

Retail:

During 2015 retail advertising revenues decreased 14.8% compared to 2014, primarily due to decreases of 20.2% in print ROP advertising revenues and 18.6% in preprint advertising revenues, compared to 2014. These decreases were partially offset by increases in digital retail advertising of 1.3% in 2015 compared to 2014. The overall decreases in retail advertising revenues in 2015 mainly reflect a pullback by large retailers in preprint and ROP advertising.

National:

National advertising revenues decreased 9.7% during 2015 compared to 2014, with growth coming in the second half of 2015. National advertising grew 1.5% in the second half of 2015 compared to the same period in 2014. For 2015, we experienced a 24.2% decrease in print national advertising and an 18.1% increase in digital national advertising compared to 2014. Overall the decrease in total national advertising revenues during 2015 was led by the telecommunications category, as a result of declines in that category during the first half of 2015, offset by new customers entering the digital marketplace and new programmatic product offerings.

24

Classified:

During 2015 classified advertising revenues decreased 14.1% compared to 2014. During 2015 compared to 2014, we experienced decreases in print classified advertising of 13.9% and decreases in digital classified advertising of 14.3%. The decreases were across the major classified categories of automotive, employment and real estate. Almost half of the decrease in automotive was a result of the five-year affiliate agreement with Cars.com signed on October 1, 2014, which resulted in higher wholesale costs for their digital products and services in 2015. These wholesale costs are recorded as a reduction in the related revenues for these products and services. We had $28.1 million in wholesale fees during 2015 compared to $21.3 million in 2014. In addition, advertisers are increasingly using digital advertising, which is more competitive than print advertising.

The following is a discussion of the major classified advertising categories for 2015 compared to 2014:

· Automotive advertising revenues decreased 28.7% in 2015. Print automotive advertising revenues declined 32.0% in 2015 as advertisers continued to shift advertising buys to digital products. Digital automotive advertising revenues were down 26.4% in 2015 primarily due to higher wholesale fees to third-party providers of the automotive products and services.

· Real estate advertising revenues decreased 10.4% in 2015. Print real estate advertising revenues declined 16.0% in 2015 and digital real estate advertising revenues decreased slightly at 0.7% in 2015. Print real estate revenues have decreased due to the continued decrease of the real estate advertising market as it shifts from traditional media to digital media. Digital real estate advertising in 2014 included $0.4 million of revenues from Apartments.com that were not included in 2015 due to the April 1, 2014, sale of that business by Classified Ventures (former equity investment). We no longer sell the Apartments.com products or services.

· Employment advertising revenues decreased 12.4% in 2015 reflecting an employment market that continues to shift from traditional media to digital media, which includes a wider array of options. Print employment advertising revenues declined 12.1% in 2015 and digital employment advertising revenues were down 12.6% in 2015.

· Other classified advertising revenues, which include legal, remembrance and celebration notices and miscellaneous advertising, decreased 4.1% in 2015. Print other classified advertising revenues declined 5.1% in 2015 and digital other classified advertising revenues were down slightly at 0.9% in 2015.

Digital:

Digital advertising revenues, which are included in each of the advertising categories discussed above, constituted 26.2% of total advertising revenues in 2015 compared to 23.7% in 2014. Total digital advertising includes digital advertising both bundled with print and sold on a stand-alone basis. In 2015 total digital advertising revenues decreased 3.7% to $167.0 million compared to 2014. Digital-only advertising revenues increased 2.9% to $106.1 million in 2015 compared to 2014. Certain digital-only advertising revenues declined due to the elimination of the Apartments.com revenues, as described above, and also due to higher wholesale fees paid to third-party providers of the digital automotive products and services. The advertising industry is still experiencing a secular shift in advertising demand from print to digital products as advertisers look for multiple advertising channels to reach their customers, and while our position in the digital revenue market over time has improved, we expect to continue to face intense competition in the digital advertising space. Digital advertising revenues sold in conjunction with print products declined 13.4% in 2015 compared to 2014 as a result of fewer print advertising sales. 

Direct Marketing and Other:

Direct marketing and other advertising revenues decreased 6.9% during 2015 compared to 2014.  The decrease was partially due to the declines in the preprint retail advertising by large retail customers as described above and the elimination of certain niche products during fiscal year 2014 that did not meet our profit expectations.

Audience Revenues

Audience revenues increased 0.3% during 2015 compared to 2014. Overall, audience revenues included an increase of 10.8% in digital audience revenues during 2015, partially offset by lower print audience revenues as a result of lower

25

circulation volumes. Circulation volumes continue to decline as a result of fragmentation of audiences faced by all media as available media outlets proliferate and readership trends change. We continue to look for new opportunities to reduce our declines in circulation volumes and increase our audience revenues.

Operating Expenses

Total operating expenses increased 22.3% in 2015 compared to 2014. The increase in 2015 was primarily due to the impairment charges of $304.8 million incurred during 2015, offset by decreases in newsprint expense and a greater amount of accelerated depreciation in 2014. Our total operating expenses reflect our continued effort to reduce costs through streamlining processes to gain efficiencies as well as headcount reductions.

The following table summarizes our operating expenses, which compares 2015 to 2014:

	Years Ended
	December 27,		December 28,		$		%
	2015		2014		Change		Change
Compensation expenses	$	395,449	$	411,881	$	(16,432)	(4.0)
Newsprint, supplements and printing expenses		95,674		114,801		(19,127)	(16.7)
Depreciation and amortization expenses		101,595		113,638		(12,043)	(10.6)
Other operating expenses		404,347		415,682		(11,335)	(2.7)
Asset impairments		304,848		8,227		296,621	nm
	$	1,301,913	$	1,064,229	$	237,684	22.3

nm – not meaningful

Compensation expenses decreased 4.0% in 2015 compared to 2014. The decrease was primarily due to a  decrease in payroll expenses in 2015 of 3.5% compared to 2014, reflecting a 9.0% decline in average full-time equivalent employees. The decrease in payroll expense was partially offset by higher severance costs. Fringe benefits costs in 2015 decreased 6.8% compared to 2014.

Newsprint, supplements and printing expenses decreased 16.7% in 2015 compared to 2014. During 2015 compared to 2014, newsprint expense declined 23.4%. The newsprint declines reflect an 18.0% decrease in newsprint usage and a 6.7% decrease in newsprint prices during 2015compared to 2014.

Depreciation and amortization expenses decreased 10.6% in 2015 compared to 2014. Depreciation expense decreased $7.5 million in 2015 compared to 2014, partially due to the impact and timing of accelerated depreciation during the periods and due to assets that became fully depreciated in 2014 or early 2015. During 2015, we incurred accelerated depreciation of $10.3 million related to the production equipment associated with outsourcing our printing process at a few of our newspapers, compared to $13.5 million in accelerated depreciation during 2014. The accelerated depreciation during 2014, (i) related to the production equipment associated with outsourcing our printing process at one newspaper and (ii) resulted from moving the printing operations for another newspaper to a newly purchased production facility. Amortization expense decreased $4.6 million in 2015compared to 2014 primarily due to certain circulation subscriber lists that became fully amortized during the third quarter of 2014.

Other operating expenses decreased 2.7% in 2015 compared to 2014. The decrease in other operating expenses is primarily due to a decrease in postage of $5.6 million, professional fees of $4.6 million, as well as other miscellaneous expenses of $8.7 million, which were partially offset by increases in circulation delivery costs of $3.1 million and sales costs for digital advertising of $4.3 million.  

26

Goodwill and other asset impairments increased during 2015 compared to 2014. In 2015, we recorded non-cash impairment charges related to goodwill of $290.9 million resulting from an interim goodwill impairment test during the second quarter of 2015, and to intangible newspaper mastheads of $13.9 million resulting from interim and annual impairment testing. See Notes 1 and 4 for additional discussion. During 2014, we recorded $8.2 million of non-cash impairment charges to reduce the carrying value of mastheads, real property, land and non-newsprint inventory. The charges consisted of $5.2 million for masthead impairments resulting from our annual impairment testing, $2.0 millionwrite-down of non-newsprint inventory and $1.0 million for a write-down of buildings and land at one of our newspapers.

Non‑Operating Items

Interest Expense:

Total interest expense decreased 32.6% in 2015 compared to 2014, primarily reflecting lower overall debt balances due to the retirements and repurchases made in the fourth quarter of 2014 and to a lesser degree repurchases of debt during 2015.

Equity Income:

Total income from unconsolidated investments decreased 47.1% during 2015 compared to 2014 due to lower income from our equity method investments. The equity income in unconsolidated companies in the first nine month of 2014 included income from Classified Ventures, which was sold in October 2014 (see Recent Developments). During 2015, we had no equity income as a result of our sale of our equity interest in Classified Ventures. Except for the final distribution of $7.5 million received in April 2015, we will no longer receive equity income or distributions from this former investment. The final distribution was recorded as a gain on the sale of our ownership interest in Classified Ventures in 2015, as discussed below. In addition, during 2015 and 2014, we recorded write‑downs of $8.2 million and $7.8 million, respectively, which reduced our equity income in unconsolidated companies, net, in the consolidated statements of operations.The write-down in 2015 was primarily related to CareerBuilder, LLC, which recorded a non-cash, goodwill impairment charge related to their international reporting unit in the fourth quarter of 2015. Our portion of that impairment charge was $7.5 million. The write-down in 2014 was primarily our interest in the Ponderay Newsprint Company.

Gains related to equity investments:

We recognized $8.1 million in gains related to equity investments during 2015 from Classified Ventures as a result of a final cash distribution that was received in April 2015 and a final working capital adjustment received in the first quarter of 2015. See previous discussion in Recent Developments.

Extinguishment of Debt:

During 2015, we repurchased $95.2 million aggregate principal amount of various series of our outstanding notes. We repurchased these notes at either par or at a price lower than par value and wrote off historical discounts and unamortized issuance costs related to these notes, as applicable, which resulted in a net gain on extinguishment of debt of $1.2 million in 2015.

During 2014, we repurchased $494.2 million aggregate principal amount of various series of our outstanding notes. We repurchased these notes at a price higher than par value and wrote off historical discounts and unamortized issuance costs related to these notes, as applicable, which resulted in a loss on extinguishment of debt of $72.8 million in 2014.

Income Taxes:

In 2015, we recorded an income tax benefit on continuing operations of $11.8 million. The income tax benefit differs from the expected federal amounts primarily due to the tax impact of state income taxes, the impact of non-tax-deductible goodwill, the reversal of unrecognized tax benefits and certain expenses not deductible for income tax purposes. 

In 2014 we recorded an income tax provision on continuing operations of $231.2 million.  The income tax provision differs from the expected federal amount primarily due to state taxes, including benefits from certain favorable state tax adjustments and certain state taxes that do not vary with net income.  For 2014, our income tax provision includes the tax impact of certain discrete tax items, such as (i) gains related to equity investments (ii) certain asset disposals, impairments and accelerated depreciation, (iv) loss on the repurchase of debt, and (iii) severance.

27

2014 Compared to 2013

Revenues

The following table summarizes our revenues by category, which compares 2014 to 2013:

	Years Ended
	December 28,		December 29,			$	%
(in thousands)	2014		2013			Change	Change
Advertising:
Retail	$	374,425	$	414,482	$	(40,057)	(9.7)
National		50,796		62,558		(11,762)	(18.8)
Classified:
Automotive		53,025		76,238		(23,213)	(30.4)
Real estate		30,240		33,786		(3,546)	(10.5)
Employment		34,378		38,779		(4,401)	(11.3)
Other		61,227		65,125		(3,898)	(6.0)
Total classified		178,870		213,928		(35,058)	(16.4)
Direct marketing and other		127,692		131,160		(3,468)	(2.6)
Total advertising		731,783		822,128		(90,345)	(11.0)
Audience		366,592		346,311		20,281	5.9
Other		48,177		46,409		1,768	3.8
Total revenues	$	1,146,552	$	1,214,848	$	(68,296)	(5.6)

During 2014, total revenues decreased 5.6% compared to 2013 primarily due to the continued decline in demand for advertising in our industry and due to a change to net revenue accounting for certain digital advertising contracts in 2014 (as discussed previously). The continued volatility in consumer spending and a secular shift in advertising demand from print to digital products, which are widely available from many media competitors and are generally sold at lower prices than print products, are the principal causes of the decline in total advertising revenues. The decline in total advertising revenues was partially offset by increases in our audience revenues due primarily to the shift of some of our newspapers to fee-for-service circulation delivery contracts and sales of our subscription products.

Advertising Revenues

Total advertising revenues decreased 11.0% in 2014 compared to 2013. While we experienced declines in almost all of our revenue categories, the decrease in total advertising revenues related primarily to declines in retail and national advertisingand due to a change to net revenue accounting for certain digital advertising contracts in 2014. The decreases in total advertising revenues were partially offset by an increase in our digital retail revenues. In addition, our affiliate agreement to sell products from Apartments.com terminated in connection with Classified Ventures’ sale of that business on April 1, 2014, resulting in $0.4 million in revenues from Apartments.com during 2014 compared to $3.7 million in 2013. 

The following table reflects the category of advertising revenues as a percentage of total advertising revenues for the periods presented:

	Years Ended
	December 28,		December 29,
	2014		2013
Advertising:
Retail	51.2	%	50.4	%
National	6.9	%	7.6	%
Classified	24.4	%	26.0	%
Direct marketing and other	17.5	%	16.0	%
Total advertising	100.0	%	100.0	%

Retail:

Retail advertising revenues decreased 9.7% in 2014 compared to 2013. The decrease in retail advertising revenues was

28

primarily due to decreases of 13.5% in print ROP advertising revenues and 12.5% in preprint advertising revenues compared to 2013. These decreases were partially offset by an increase in digital retail advertising of 4.5% during 2014 compared to 2013. The overall decreases in retail advertising revenues reflected a sluggish retail advertising environment.

National:

National advertising revenues decreased 18.8% in 2014 compared to 2013. The industry has seen a persistent decline in national advertising at regional newspaper companies over the last several years. We experienced a 23.2% decrease in print national advertising and an 8.7% decrease in digital national advertising during 2014 compared to 2013.  Decreases in total national advertising revenues during 2014 were led by decreases in the telecommunications category, which showed stronger performances in 2013. Also contributing to the decline in total national advertising revenues for 2014, was a decrease in the entertainment category.

Classified:

Classified advertising revenues decreased 16.4% in 2014 compared to 2013. The print and digital automotive, print and digital employment, print and digital real estate, and print other (primarily including legal, remembrance and celebration notices and miscellaneous advertising) categories represented our largest declines in classified advertising during 2014. The decreases were partially due to a change to net revenue accounting for certain digital advertising contracts in 2014 and the sale of Apartments.com by Classified Ventures in April 2014. Advertisers are increasingly using digital advertising, which is widely available from many of our competitors, instead of print advertising. During 2014 compared to 2013, we experienced a decrease in print classified advertising of 10.2% and digital classified advertising decreased 23.8%. The decreases in digital classified advertising were impacted by the lack of Apartments.com revenue in most of 2014 compared to 2013 and due to a change to net revenue accounting for certain digital advertising contracts in 2014.

The following is a discussion of the major classified advertising categories for 2014 as compared to 2013:

· Automotive advertising revenues decreased 30.4% in 2014. Print automotive advertising revenues declined 22.2% in 2014, while digital automotive advertising revenues were down 35.5%. The decline in print automotive advertising revenues reflects the continued migration of automotive advertising to digital platforms, including the popularity of the Cars.com products with local auto dealerships.The digital automotive advertising revenues results primarily reflect the change to net revenue accounting for certain digital advertising contracts in 2014.

· Real estate advertising revenues decreased 10.5% in 2014. Print real estate advertising revenues declined 6.8% and digital real estate advertising revenues decreased 16.3% in 2014. Real estate revenues have decreased, partially due to having no revenues from Apartments.com after the first quarter of 2014 and also due to the continued shifts from traditional media to digital media, which is widely available from many media competitors. We had $0.4 million in real estate revenues from Apartments.com in 2014 compared to $3.7 million in 2013.

· Employment advertising revenues decreased 11.3% in 2014 reflecting an employment market that continues to shift from traditional media to digital media, which included a wider array of options and due to a change to net revenue accounting for certain digital advertising contracts in 2014. Print employment advertising revenues declined 6.4% in 2014. Digital employment advertising revenues were down 15.2% in 2014, due mostly to a change to net revenue accounting for certain digital advertising contracts in 2014. 

· Other classified advertising revenues, which include legal, remembrance and celebration notices and miscellaneous advertising, decreased 6.0% in 2014. Print other classified advertising revenues declined 5.9% and digital other classified advertising revenues were down 6.1% in 2014.

Digital:

Digital advertising revenues, which are included in each of the advertising categories discussed above, constituted 23.7% of total advertising revenues in both 2014 and 2013. Total digital advertising includes digital advertising both bundled as a print up-sale and sold on a stand-alone basis. Digital advertising revenues declined 10.9% to $173.4 million in 2014 compared to $194.7 million in 2013 and digital‑only advertising revenues decreased 10.5% to $103.0 million in 2014 compared to $115.2 million in 2013. The decreases in total digital advertising revenues and digital-only advertising reflect

29

the change to net revenue accounting for certain digital advertising contracts in 2014. In addition, we had $0.4 million in revenues from sales of Apartments.com products in 2014 compared to $3.7 million in 2013. Digital advertising revenues sold in conjunction with print products declined 11.5% in 2014 compared to 2013 as a result of fewer print advertising sales. We expect the secular shift in advertising demand from print to digital products to continue as advertisers look for multiple advertising channels to reach their customers. 

Direct Marketing and Other:

Direct marketing and other advertising revenues decreased 2.6% during 2014 compared to 2013. The decrease was partially due to the sluggish print retail environment and the elimination of certain niche products that did not meet profit expectations. We continued to experience growth in revenues from our “Sunday Select” product, a package of preprinted advertisements delivered to non‑subscribers upon request, which grew 4.1% in 2014 compared to 2013.

Audience Revenues

Audience revenues increased 5.9% during 2014 compared to 2013. Contributing to the growth in total audience revenues in 2014 compared to 2013 was an increase of $22.0 million in revenues related to newspapers that changed to fee-for-service circulation delivery contracts. The increase in revenues related to changing contracts also had a corresponding increase in other operating expenses as discussed below. During 2014 we had six newspapers in various stages of transition to fee-for-service contracts for home-delivery subscribers. In total, 27 of our 29 daily newspapers had transitioned or were in the process of transitioning to fee-for-service contracts for home-delivery subscribers as of December 28, 2014, and the two remaining newspapers were transitioned in 2015. The overall audience revenues increase was partially offset by lower circulation volumes. Daily circulation volumes declined 6.5% in 2014 compared to 2013. In 2013, daily circulation volumes had declined 6.0% as compared to 2012. Sunday circulation volumes declined 2.4% in 2014 compared to 2013. As expected, circulation volumes continued to decline as a result of fragmentation of audiences faced by all media as available media outlets proliferate and readership trends change.

Operating Expenses

During 2014, total operating expenses decreased 2.7% compared to 2013. As discussed above, during 2014, we changed to net revenue accounting for certain digital advertising contracts, which resulted in expenses previously reported in other operating expenses being recorded as a reduction in the associated revenues. In addition, our total operating expenses reflected our continued effort to reduce costs through streamlining processes to gain efficiencies, as well as headcount reductions. However, operating expenses in 2014 reflect increases in non-cash operating expenses, including non-cash impairment charges and accelerated depreciation, as well as increases for newspapers that changed to fee-for-service circulation delivery contracts as discussed in the Audience Revenues section above. Operating expenses in all periods presented included employee severance related to headcount reductions. 2013 also included moving expenses primarily related to the relocation of our Miami newspaper operations and other production facility moves and outsourcing.

The following table summarizes our operating expenses, which compares 2014 to 2013:

	Years Ended
	December 29,		December 29,		$		%
(in thousands)	2014		2013		Change		Change
Compensation expenses	$	411,881	$	422,981	$	(11,100)	(2.6)
Newsprint, supplements and printing expenses		114,801		120,551		(5,750)	(4.8)
Depreciation and amortization expenses		113,638		121,570		(7,932)	(6.5)
Other operating expenses		415,682		411,621		4,061	1.0
Asset impairments		8,227		17,181		(8,954)	(52.1)
	$	1,064,229	$	1,093,904	$	(29,675)	(2.7)

Compensation expenses, which includes the severance costs discussed above, decreased 2.6% during 2014 compared to 2013. Payroll expenses in 2014 decreased 1.7% compared to 2013, reflecting a 6.6% decline in average full‑time equivalent employees partially offset by higher severance costs in 2014. In addition, fringe benefits costs in 2014 decreased 6.8% compared to 2013, primarily as a result of lower pension and post retirement expenses.

Newsprint, supplements and printing expenses decreased 4.8% in 2014 compared to 2013. Newsprint expense decreased by 11.7% in 2014 compared to 2013, reflecting a 10.9% decrease in newsprint usage and a 0.9% decrease in newsprint

30

prices during 2014 compared to 2013. These decreases in newsprint were partially offset by increases in outsourced printing costs of $7.4 million in 2014, primarily related to the outsourcing of our printing process at one newspaper.

Depreciation and amortization expenses decreased 6.5% in 2014 compared to 2013. The decrease in depreciation expense during 2014 compared to 2013 was primarily related to approximately $5.9 million associated with assets that became fully depreciated. This decrease was partially offset by $13.5 million in accelerated depreciation in 2014; (i) related to the production equipment associated with outsourcing our printing process at one newspaper and (ii) resulting from moving the printing operations for another newspaper to the newly purchased production facility. During 2013, we incurred $11.4 million in accelerated depreciation (i) related to equipment formerly used in our Miami operations prior to the relocation of these operations, (ii) related to the production equipment associated with outsourcing our printing process at one of our newspapers and (iii) moving the printing operations for another newspaper.Amortization expense decreased $4.2 million in 2014 compared to 2013 primarily due to certain circulation subscriber listing amortization schedules which became fully amortized at the beginning of the quarter ended September 28, 2014.

Other operating expenses increased 1.0% in 2014 compared to 2013. The increase included $22.0 million in expenses related to newspapers that changed to fee-for-service circulation delivery contracts, $6.2 million net in other sales costs for digital advertising and customer sales costs, and $1.3 million in additional professional fees. The expenses related to changing to fee-for-service contracts also have a corresponding increase in audience revenues as discussed previously. The increase in operating expenses was partially offset by a decrease of $6.0 million in 2014 compared to 2013, for moving costs related to the relocation of our Miami operations in 2013 and due to a change to net revenue accounting for certain digital advertising contracts in 2014.

Asset impairments for 2014 included $8.2 million of non‑cash impairment charges to reduce the carrying value of mastheads, real property, land and non-newsprint inventory. The charges consist of $5.2 million for masthead impairments resulting from our annual impairment testing, $2.0 million write-down of non-newsprint inventory and $1.0 million for a write-down of buildings and land at one of our newspapers. Asset impairments in 2013 include $17.2 million of non-cash impairment charges to reduce the carrying value of mastheads and real property, land, and production equipment. The charges include $5.3 million for masthead impairments resulting from our annual impairment testing and $11.9 million for impairment charges related to our existing production facilities and equipment as a result of entering into an agreement to outsource our printing process at one of our newspapers.

Non‑Operating Items

Interest Expense:

Total interest expense decreased 5.8% during 2014 compared to 2013. Interest expense related to debt decreased 5.5% during 2014 compared to 2013, reflecting lower debt balances. Other fluctuations in total interest expense were primarily due to reductions in interest expense on our financial obligations resulting from the elimination of our Miami financial obligation in the quarter ended June 30, 2013, when we completed our move of the Miami operation to a new facility.

Equity Income:

Total income from unconsolidated investments decreased 55.3% during 2014 compared to 2013. The decrease was primarily due to (i) lower results from our internet-related investments and from our newsprint mill partnership, (ii) a $7.8 million write‑down of certain unconsolidated investments, primarily our interest in the Ponderay Newsprint Company, (iii) the sale of Apartments.com by Classified Ventures in April 2014, and (iv) the sale of our ownership interest in the remainder of Classified Ventures on October 1, 2014.

As discussed more fully in Recent Developments previously, Classified Ventures sold its Apartments.com business on April 1, 2014, and as a result, incurred additional legal, accounting and other transaction-related costs in 2014 associated with the sale. We only reported our share of Classified Ventures’ income from its Apartments.com business through the quarter ended March 30, 2014, compared to all of 2013.

Also, discussed more fully in Recent Developments previously, we sold our ownership interest in Classified Ventures on October 1, 2014, and as a result, weonly reported our share of Classified Ventures’ income through the quarter ended September 28, 2014, compared to all of 2013.

31

Gains related to equity investments:

We recognized $705.2 million in gains related to equity investments for 2014, which were more fully described in the Recent Developments section previously. Specifically we recognized(i)  our $144.2 million share of the gain, when Classified Ventures sold its Apartments.com business on April 1, 2014; (ii)  a  gain on the sale of $1.7 million when we transferred our partnership interest in MCT and entered into a contributor agreement with MCT on May 7, 2014; and (iii) a gain of $559.3 million on the sale of our ownership interest in Classified Ventures on October 1, 2014. We no longer receive equity income from these former investments.

Loss on Extinguishment of Debt:

During 2014, we repurchased $494.2 million aggregate principal amount of various series of our outstanding notes. We repurchased these notes at a price higher than par value and wrote off historical discounts and unamortized issuance costs related to these notes, which resulted in a loss on extinguishment of debt of $72.8 million in 2014. During 2013, we redeemed or repurchased $155.9 million aggregate principal amount of various series of our outstanding notes. We redeemed or repurchased these notes at a price higher than par value and wrote off historical discounts and unamortized issuance costs related to these notes, which resulted in a loss on extinguishment of debt of $13.6 million in 2013.

Income Taxes:

In 2014, we recorded an income tax provision on continuing operations of $231.2 million.  For 2014, the income tax provision differs from the expected federal amount primarily due to state taxes, including benefits from certain favorable state tax adjustments and certain state taxes that do not vary with net income.  For 2014, our income tax provision included the tax impact of certain discrete tax items, such as (i) gains related to equity investments (ii) certain asset disposals, impairments and accelerated depreciation, (iv) loss on the repurchase of debt, and (iii) severance.

In 2013, we recorded an income tax provision on continuing operations of $11.7 million.  The income tax provision was lower than the expected federal amount primarily due to state taxes including benefits from certain favorable state tax adjustments and certain state taxes that do not vary with net income. For 2013, the income tax provision included the tax impact of certain discrete tax items, such as (i) loss on the refinancing of debt, (ii) certain asset disposals and impairments, and (iii) severance.

Liquidity and Capital Resources

Sources and Uses of Liquidity and Capital Resources:

Our cash and cash equivalents were $9.3 million as of December 27, 2015, compared to $220.9 million of cash and cash equivalents at December 28, 2014.  The cash and cash equivalents balance as of December 28, 2014, reflected a $146.9 million cash distribution from Classified Ventures, which was equal to our share of the proceeds from its sale of Apartments.com business; the $34.0 million in cash proceeds received from the sale of one of our newspapers; and the $606.2 million in cash proceeds received from the sale of our ownership interest in Classified Ventures. The cash and cash equivalents balance as of December 28, 2014, was also impacted by the partial payment of taxes on these transactions, as well as the repurchase of debt for a total amount of $494.2 million in cash plus accrued and unpaid interest in November 2014.

We expect that most of our cash and cash equivalents, and our cash generated from operations, for the foreseeable future will be used to repay debt, pay income taxes, fund our capital expenditures, invest in new revenue initiatives, digital investments and enterprise-wide operating systems, make required contributions to the Pension Plan, repurchase stock, and other corporate uses as determined by management and our Board of Directors. As of December 27, 2015, we had approximately $937.3 million in total aggregate principal amounts of debt outstanding, consisting of $55.5 million of our 5.750% notes due in 2017, $516.4 million of our 9.00% Notes due 2022 and $365.4 million of our notes maturing in 2027 and 2029. We expect that we will need to refinance a significant portion of this debt prior to the scheduled maturity of such debt. However, we may not be able to do so on terms favorable to us or at all. We may also be required to use cash on hand or cash from operations to meet these obligations. We believe that our cash from operations is sufficient to satisfy our liquidity needs over the next 12 months, while maintaining adequate cash and cash equivalents.

32

The following table summarizes our cash flows:

	Years Ended
	December 27,		December 28,		December 30,
(in thousands)	2015		2014		2013
Cash flows provided by (used in)
Operating activities:
Continuing operations	$	(122,529)	$	143,181	$	153,581
Discontinued operations		—		(37)		2,459
Investing activities:
Continuing operations		13,840		552,012		(19,847)
Discontinued operations		—		32,953		(200)
Financing activities;
Continuing operations		(102,840)		(588,059)		(168,270)
Increase (decrease) in cash and cash equivalents	$	(211,529)	$	140,050	$	(32,277)

Operating Activities:

We used $122.5 million of cash from continuing operations in 2015 compared to generating $143.2 million of cash from continuing operations in 2014. The decrease in cash from continuing operations during the period was primarily due to cash we received, primarily from the sale of Apartments.com by Classified Ventures of $146.9 million in 2014, and the timing of net income tax payments in 2015, offset by lower pension contributions in 2015, as discussed below. In 2015 we made income tax payments of $207.0 million compared to $77.6 million in 2014. The increase was primarily related to the 2015 tax payments on the gain on the sale of Classified Ventures (previous owned equity investment) recorded in the fourth quarter of 2014, offset by the net of tax losses on bond repurchases in the fourth quarter of 2014.

The decrease in cash generated in 2014 compared to 2013 was primarily due to the difference in contributions we made to our Pension Plan (as discussed below), and the timing of net income tax payments and receipts. In 2014 we had net payments of $77.6 million in income taxes compared to $21.0 million in 2013.

Pension Plan Matters

In February 2016 we contributed certain of our real property appraised at $47.1 million to our Pension Plan. We expected our required pension contribution under the Employee Retirement Income Security Act to be approximately $2.0 million in 2016, and the contribution of real property will exceedour required pension contribution for 2016 and we expect it toreduceour future pension contributions and expense, all other things being equal.  

We made $25.0 million and $7.6 million in cash contributions to the Pension Plan to meet our required contributions during 2014 and 2013, respectively.

As of the end of 2015, the projected benefit obligations of our Pension Plan exceeded plan assets by $464.8 million compared to $444.3 million at the end of 2014. Over the last several years federal legislation has provided for pension funding relief in the form of mandated changes in the discount rates used to calculate the projected benefit obligations for purposes of funding pension plans. Recent new legislation and calculations use historical averages of long‑term highly‑rated corporate bonds (within ranges as defined in the legislation) which have an impact of applying a higher discount rate to determine the projected benefit obligations for funding and current long‑term interest rates, but also mandated increases in fees paid to the Pension Benefit Guaranty Corporation, also known as the PBGC, based in part on the level of underfunding in various companies’ qualified defined pension plans.

Even with the relief provided by the legislative rules discussed above, based on the current funding position of the Pension Plan, we expect future contributions will be required. Future contributions are subject to numerous assumptions, including, among others, changes in interest rates, returns on assets in the Pension Plan and future government regulations. The timing and amount of payments to the Pension Plan reflect actuarial estimates we believe to be reasonable but are subject to changes in estimates. While we do not expect there to be a required contribution in 2017, after the contribution we made in February 2016 discussed above, we have not determined whether we will make a voluntary contribution to the Pension Plan in 2017. We believe cash flows from operations will be sufficient to satisfy our contribution requirements, if any.

33

Investing Activities:

We generated $13.8 million of cash from investing activities in 2015, which reflected the receipts associated with a former equity investment of $25.6 million from an escrow account and a final cash distribution of $7.5 million, offset by the purchase of property, plant and equipment of $18.6 million.

We generated $552.0 million of cash from investing activities in 2014, which was primarily due to the proceeds received from the sale of our ownership interest in Classified Ventures (see Recent Developments previously) offset by the purchase of $6.8 million in insurance-related deposits; the purchase of property plant and equipment (“PP&E”) for $23.4 million, which includes the purchase of a production facility for $5.2 million; and the purchase of $33.5 million in certificates of deposit, which collateralized our outstanding letters of credit.

We used $19.8 million of cash from investing activities in 2013, which was primarily due to the purchase of PP&E for $33.3 million, partially offset by the return of an insurance‑related deposit of $6.4 million and distributions from our equity investments, as discussed above.

Financing Activities:

We used $102.8 million of cash from financing activities in 2015 primarily related to the repurchase of our 5.75% Notes and 9.00% Notes. During 2015, we repurchased $95.2 million of aggregate principal amount of notes for $92.3 million in cash in privately negotiated repurchases (see Debt and Related Matters below). In addition, $8.4 million was used to purchase treasury shares during 2015, primarily related to $7.8 million that used to repurchase 6.1 million shares of our Class A Common Stock (see Recent Developments previously).

We used $588.1 million of cash from financing activities in 2014 primarily related to the repurchase of debt.During 2014, we repurchased $494.2 million of aggregate principal amount of notes for $584.4 million in cash in privately negotiated repurchases (see Debt and Related Matters below).

We used $168.3 million of cash from financing activities in 2013. During 2013, we redeemed or repurchased $155.9 million of aggregate principal amount of notes for $165.5 million in cash.

Debt and Related Matters

As of December 27, 2015, we had approximately $937.3 million in total principal indebtedness outstanding, including approximately $55.5 million of 5.750% notes due in 2017, $516.4 million of 9.00% Notes due in 2022, $89.2 million of 7.150% debentures due in 2027 and $276.2 million of 6.875% debentures due in 2029.

Debt Repurchases/Retirements and Extinguishment of Debt

During 2015, we repurchased a total of $95.2 million of aggregate principal amount notes through privately negotiated transactions, as follows:

(in thousands)	Face Value
9.00% senior secured notes due in 2022	$	39,370
5.750% notes due in 2017		55,857
Total notes repurchased	$	95,227

During 2015, we recorded a net gain on extinguishment of debt of $1.2 million. We repurchased most of these notes at a price lower than par value, which was partially offset by the write-off of historical discounts and unamortized issuance costs related to these notes.

During 2014, we retired $29.0 million of the 4.625% notes that matured on November 1, 2014. Additionally, during 2014 we repurchased a total of $494.2 million of aggregate principal amount notes through privately negotiated transactions. We repurchased these notes at a price higher than par value and wrote off historical discounts and unamortized issuance costs related to these notes, which resulted in a loss on extinguishment of debt of $72.8 million in 2014.

34

Credit Agreement

Our Third Amended and Restated Credit Agreement dated December 18, 2012, and as amended on October 21, 2014, (“Credit Agreement”) is secured by a first-priority security interest in certain of our assets as described below. The Credit Agreement, among other things, provides for commitments of $65 million and a maturity date of December 18, 2019.  On October 21, 2014, we entered into a Collateralized Issuance and Reimbursement Agreement (“LC Agreement”). Pursuant to the terms of LC Agreement, we may request letters of credit be issued on our behalf in an aggregate face amount not to exceed $35 million. We are required to provide cash collateral equal to 101% of the aggregate undrawn stated amount of each outstanding letter of credit.

As of December 27, 2015, there were standby letters of credit outstanding under the LC Agreement with an aggregate face amount of $33.0 million and no amounts drawn under the Credit Agreement. The amounts of standby letters of credit declined to $31.0 million in January 2016.

Under the Credit Agreement, we may borrow at either the London Interbank Offered Rate plus a spread ranging from 275 basis points to 425 basis points, or at a base rate plus a spread ranging from 175 basis points to 325 basis points, in each case based upon our consolidated total leverage ratio. The Credit Agreement provides for a commitment fee payable on the unused revolving credit ranging from 50 basis points to 62.5 basis points, based upon our consolidated total leverage ratio.

Senior Secured Notes and Indenture

In December 2012, we issued 9.00% Notes. Substantially all of our subsidiaries guarantee the obligations under the 9.00% Notes and the Credit Agreement. We own 100% of each of the guarantor subsidiaries, and we have no significant independent assets or operations separate from the subsidiaries that guarantee our 9.00% Notes and the Credit Agreement. The guarantees provided by the guarantor subsidiaries are full and unconditional and joint and several, and the subsidiaries other than the subsidiary guarantors, are minor.

In addition, we have granted a security interest to the banks that are a party to the Credit Agreement and the trustee under the indenture governing the 9.00% Notes that includes, but is not limited to, intangible assets, inventory, receivables and certain minority investments as collateral for the debt. The security interest does not include any PP&E, leasehold interests or improvements with respect to such PP&E which would be reflected on our consolidated balance sheets or shares of stock and indebtedness of our subsidiaries.

Covenants under the Senior Debt Agreements

Under the Credit Agreement, we are required to comply with a maximum consolidated total leverage ratio measured on a quarterly basis. As of December 27, 2015, we are required to maintain a consolidated total leverage ratio of not more than 6.00 to 1.00.  For purposes of the consolidated total leverage ratio, debt is largely defined as debt, net of cash on hand in excess of $20 million. As of December 27, 2015, we were in compliance with our financial debt covenant.

At December 27, 2015, our consolidated leverage ratio (as defined in the Credit Agreement) was 4.77 to 1.00 and we were in compliance with all of our other debt covenants. Due to the significance of our outstanding debt, remaining in compliance with debt covenants is critical to our operations. We will continue to optimize operations and/or reduce debt to maintain compliance with our covenants.

The Credit Agreement also prohibits the payment of a dividend if a payment would not be permitted under the indenture for the 9.00% Notes (discussed below). Dividends under the indenture for the 9.00% Notes are allowed if the consolidated leverage ratio (as defined in the indenture) is less than 5.25 to 1.00 and we have sufficient amounts under our restricted payments basket (as defined in the indenture). However, the payment and amount of future dividends remain within the discretion of our Board of Directors and will depend upon our future earnings, financial condition, and other factors considered relevant by our Board of Directors.

The indenture for the 9.00% Notes and the Credit Agreement include a number of restrictive covenants that are applicable to us and our restricted subsidiaries. The covenants are subject to a number of important exceptions and qualifications set forth in those agreements. These covenants include, among other things, restrictions on our ability to incur additional debt; make investments and other restricted payments; pay dividends on capital stock or redeem or repurchase capital stock or

35

certain of our outstanding notes or debentures prior to stated maturity; sell assets or enter into sale/leaseback transactions; create specified liens; create or permit restrictions on the ability of our restricted subsidiaries to pay dividends or make other distributions; engage in certain transactions with affiliates; and consolidate or merge with or into other companies or sell all or substantially all of the Company’s and our subsidiaries’ assets, taken as a whole.

Off‑Balance‑Sheet Arrangements

As of December 27, 2015, we did not have any significant off‑balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S‑K.

Contractual Obligations:

As of the end of 2015 our contractual obligations were as follows:

	Payments Due By Period
			Less than		1-3		3-5		More than
(in thousands)	Total		1 Year		Years		Years		5 Years
Long-term debt principal	$	937,275	$	—	$	55,442	$	—	$	881,833
Interest on long-term debt		667,256		75,695		148,214		144,332		299,015
Pension obligations (a)		581,717		10,450		59,430		182,475		329,362
Post-retirement obligations (a)		9,883		1,297		2,303		1,968		4,315
Workers’ compensation obligations (b)		16,608		3,599		4,247		2,401		6,361
Other long-term obligations (c)		72,990		14,680		16,610		12,877		28,823
Financing obligations (d)		36,384		3,987		7,973		7,973		16,451
Other obligations:
Purchase obligations (e)		70,509		19,364		16,704		10,860		23,581
Operating leases (f)		67,508		11,467		18,965		12,341		24,735
Total (g)	$	2,460,130	$	140,539	$	329,888	$	375,227	$	1,614,476

(a) Pension and Post-retirement obligations do not take into account the tax‑deductibility of the payments. This does not include the February 2016, contribution of $47.1 million in real property to our Pension Plan, described in Recent Developments previously. This contribution in February 2016 will satisfy our $2 million, $18.2 million and $24.5 million minimum required contributions for 2016, 2017 and 2018, respectively, that are included in the table above.

(b) Future expected workers’ compensation payments are based on undiscounted ultimate losses and are shown net of estimated recoveries.

(c) Primarily deferred compensation, future lease obligations and indemnification obligation reserves related to disposed newspapers.

(d) Financing obligations include the obligations related to our contribution and leaseback of certain property to the Pension Plan in 2011. See further discussion in Note 7. This does not include any future obligations related to our contribution and leaseback of certain property to the Pension Plan in 2016, as described above.

(e) Primarily printing outsource agreements and capital expenditures for property, plant and equipment.

(f) Excludes payments on leases included in financing obligation above.

(g) The table excludes unrecognized tax benefits, and related penalties and interest, totaling $18.1 million because a reasonably reliable estimate of the timing of future payments, if any, cannot be determined.

Critical Accounting Policies

The accompanying MD&A is based upon our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. These estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We base our estimates and judgments on historical experience and on various other assumptions that we believe are reasonable under the

36

circumstances. However, future events are subject to change and the best estimates and judgments routinely require adjustment. The most significant areas involving estimates and assumptions are amortization and/or impairment of goodwill and other intangibles, pension and post‑retirement expenses, insurance reserves, and our accounting for income taxes. We believe the following critical accounting policies, in particular, affect our more significant judgments and estimates used in the preparation of our consolidated financial statements.

Goodwill

Goodwill consists of the excess of cost of acquired enterprises over the sum of the amounts assigned to identifiable assets acquired less liabilities assumed. We assess goodwill for impairment on an annual basis at a reporting unit level and we have identified two reporting units. Effective July 1, 2015, following the retirement of a segment manager,  one reporting unit (“West” reporting unit) primarily consists of operations in our California, Northwest and the Midwest operating regions and the other reporting unit (“East” reporting unit) primarily consists of operations in our Southeast and Florida operating regions. Goodwill is assessed between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. These events or circumstances could include a significant change in the business climate, a change in strategic direction, legal factors, operating performance indicators, a change in the competitive environment, the sale or disposition of a significant portion of a reporting unit, or future economic factors such as unfavorable changes in our stock price and market capitalization or unfavorable changes in the estimated future discounted cash flows of our reporting units. Our annual test is performed at our fiscal year end.

Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. We considered both a market approach and an income approach in order to develop an estimate of the fair value of each reporting unit for purposes of our annual impairment test. When available, and as appropriate, we use market multiples derived from a set of competitors or companies with comparable market characteristics to establish fair values for a particular reporting unit (market approach). We also estimate fair value using discounted projected cash flow analysis (income approach). Potential impairment is indicated when the carrying value of a reporting unit, including goodwill, exceeds its estimated fair value. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long‑term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital. Changes in these estimates and assumptions could materiallyaffect the determination of fair value and goodwill impairment for each reporting unit. In addition, financial and credit market volatility directly impacts our fair value measurement through our weighted average cost of capital, used to determine our discount rate, and through our stock price, used to determine our market capitalization. We may be required to recognize impairment of goodwill based on future economic factors such as unfavorable changes in our stock price and market capitalization or unfavorable changes in the estimated future discounted cash flows of our reporting units.

If we determine that the estimated fair value of any reporting unit is less than the reporting unit’s carrying value, then we proceed to the second step of the goodwill impairment analysis to measure the potential impairment charge. An impairment loss is recognized for any excess of the carrying value of the reporting unit’s goodwill over the implied fair value. If goodwill on our consolidated balance sheet becomes impaired during a future period, the resulting impairment charge could have a material impact on our results of operations and financial condition.

Due to the current economic environment and the uncertainties regarding potential future economic impacts on our reporting units, there can be no assurances that estimates and assumptions made for purposes of our annual goodwill impairment test will prove to be accurate predictions of the future. If assumptions regarding forecasted revenues or margins of certain of our reporting units are not achieved, we may be required to record goodwill impairment losses in future periods. It is not possible at this time to determine if any such future impairment loss would occur, and if it did occur, whether such charge would be material.

We performed an interim goodwill impairment testing at June 28, 2015, based on the reporting units that existed at that time. Based on that testing, the fair value of our reporting unit that primarily consisted of operations in California, the Northwest and Texas, exceeded the carrying value by approximately 12.9%, and we did not incur any goodwill impairment for this reporting unit. The reporting unit that primarily consisted of operations in the Southeast, Florida and the Midwest, recorded an impairment charge of $290.9 million during the quarter and six months ended June 28, 2015, as described in Note 2, Intangible Assets and Goodwill.

Based on our annual impairment testing analysis, at December 27, 2015, the fair value of our West reporting unit exceeded the carrying value by approximately 32.9%, and the fair value of the East reporting unit exceeded the carrying value by approximately 25.8%. Assumptions are highly subjective and sensitive to industry and our performance.

37

Mastheads:

Newspaper mastheads (newspaper titles and website domain names) are not subject to amortization and are tested for impairment annually (at year‑end), or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of each newspaper masthead with its carrying amount. We use a relief from royalty approach that utilizes discounted cash flows to determine the fair value of each newspaper masthead. Our judgments and estimates of future operating results in determining the reporting unit fair values are consistently applied to each newspaper in determining the fair value of each newspaper masthead.

We performed an interim impairment test as of June 28, 2015 on newspaper mastheads, and annual impairment tests on as of December 27, 2015, December 28, 2014, and December 29, 2013. As a result of our testing, we recorded a charge of $9.5 million for the quarter and six months ended June 28, 2015, and a total of $13.9 million in 2015. We recorded a charge of $5.2 million and $5.3 million for masthead impairments in 2014 and 2013, respectively.

Other Intangible Assets:

Long‑lived assets such as other intangible assets are subject to amortization (primarily advertiser and subscriber lists) and are tested for recoverability whenever events or change in circumstances indicate that their carrying amounts may not be recoverable. The carrying amount of each asset group is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use of such asset group. No impairment loss was recognized on intangible assets subject to amortization in 2015, 2014 or 2013.

Pension and Post‑Retirement Benefits:

We have significant pension and post‑retirement benefit costs and credits that are developed from actuarial valuations. Inherent in these valuations are key assumptions including discount rates and expected returns on plan assets. We are required to consider current market conditions, including changes in interest rates, in establishing these assumptions. Changes in the related pension and post‑retirement benefit costs or credits may occur in the future because of changes resulting from fluctuations in our employee headcount and/or changes in the various assumptions.

Current standards of accounting for defined benefit pension plans and post‑retirement benefit plans require recognition of (1) the funded status of a pension plan (difference between the plan assets at fair value and the projected benefit obligation) and (2) the funded status of a post‑retirement plan (difference between the plan assets at fair value and the accumulated benefit obligation), as an asset or liability on the balance sheet. At December 27, 2015, net retirement obligations in excess of the retirement plans’ assets were $581.7 million. This amount included $116.9 million for non‑qualified plans that do not have assets and $464.8 million for our qualified plan. The funded status as of December 27, 2015, does not include the contribution of real property of $47.1 million to the qualified pension plan in February 2016 that is discussed in Note 12. At December 28, 2014, net retirement obligations in excess of the retirement plans’ assets were $573.2 million. This amount included $128.9 million for non‑qualified plans that do not have assets and $444.3 for our qualified plan.

We used discount rates of 3.69% to 4.25% and an assumed long‑term return on assets of 7.75% to calculate our retirement plan expenses in 2015.

For 2015, a change in the weighted average rates would have had the following impact on our net benefit cost:

· A decrease of 50 basis points in the long‑term rate of return would have increased our net benefit cost by approximately $6.9 million;

· A decrease of 25 basis points in the discount rate would have increased our net benefit cost by approximately $0.1 million.

Income Taxes:

Our current and deferred income tax provisions are calculated based on estimates and assumptions that could differ from the actual results reflected in income tax returns filed during the subsequent year. These estimates are reviewed and adjusted, if needed, throughout the year. Adjustments between our estimates and the actual results of filed returns are recorded when identified.

The amount of income taxes paid is subject to periodic audits by federal and state taxing authorities, which may result in proposed assessments. These audits may challenge certain aspects of our tax positions such as the timing and amount of deductions and allocation of taxable income to the various tax jurisdictions. Income tax contingencies require significant

38

judgment in estimating final outcomes. Actual results could materially differ from these estimates and could significantly affect the effective tax rate and cash flows in future periods.

Insurance:

We are insured for workers’ compensation using both self‑insurance and large deductible programs. We rely on claims experience in determining an adequate provision for insurance claims.

We used a discount rate of 1.8% to calculate workers’ compensation reserves as of December 27, 2015. A decrease of 25 basis points in the discount rate would have had a $0.2 million effect on total workers’ compensation reserves. A 10% increase in the claims would have increased the total workers’ compensation reserves, net of estimated recoveries, by approximately $1.5 million.

Recent Accounting Pronouncements

For information regarding the impact of certain recent accounting pronouncements, see Note 1 “Summary of Significant Accounting Policies”.

39

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The primary objective of the following information is to provide forward‑looking quantitative and qualitative information about our potential exposure to market risks. The term “market risk” refers to the risk of loss arising from adverse changes in interest rates and credit risk. The disclosure is not meant to be a precise indicator of expected future losses but rather an indicator of reasonably possible losses. Our exposure to market risk primarily relates to discount rates used in our pension liabilities.

Interest Rate Risks in Our Debt Obligations

Substantially all of our outstanding debt is composed of fixed‑rate bonds and, therefore, is not subject to interest rate fluctuations.

Discount Rate Risks in Our Pension and Post‑Retirement Obligations

The discount rate used to measure our obligations under our qualified defined benefit pension plan is generally based upon long‑term interest rates on highly‑rated corporate bonds. Hence, changes in long‑term interest rates may have a significant impact on the funding position of our qualified defined pension plan. We estimate that a 1.0% increase in our discount rate could decrease our pension obligations by approximately $198 million. Conversely, a 1.0% decrease in our discount rate could increase our pension obligations by approximately $241 million. Based on current interest rates, the amount of contributions due to the plan and the timing of the payments of these obligations are included in the table of contractual obligations above and reflect actuarial estimates we believe to be reasonable.

40

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Report of Independent Registered Public Accounting Firm	42
Consolidated Statements of Operations	43
Consolidated Statements of Comprehensive Income (Loss)	44
Consolidated Balance Sheets	45
Consolidated Statements of Cash Flows	46
Consolidated Statements of Stockholders’ Equity	47
Notes to Consolidated Financial Statements	48

41

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of The McClatchy Company:

We have audited the accompanying consolidated balance sheets of The McClatchy Company and its subsidiaries (the “Company”) as of December 27, 2015 and December 28, 2014, and the related consolidated statements operations, comprehensive income (loss), stockholders' equity, and cash flows for each of the three years in the period ended December 27, 2015. We also have audited the Company’s internal control over financial reporting as of December 27, 2015, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying “Management Report on Internal Control over Financial Reporting.” Our responsibility is to express an opinion on these financial statements and an opinion on the Company’s internal control over financial reporting based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed by, or under the supervision of, the company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the company’s board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company and its subsidiaries as of December 27, 2015 and December 28, 2014, and the results of their operations and their cash flows for each of the three years in the period ended December 27, 2015, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 27, 2015, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

/S/ DELOITTE & TOUCHE LLP

Sacramento, California

March 7, 2016

42

THE MCCLATCHY COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except per share amounts)

	Years Ended
	December 27,		December 28,		December 29,
	2015		2014		2013
REVENUES — NET:
Advertising	$	637,415	$	731,783	$	822,128
Audience		367,858		366,592		346,311
Other		51,301		48,177		46,409
		1,056,574		1,146,552		1,214,848
OPERATING EXPENSES:
Compensation		395,449		411,881		422,981
Newsprint, supplements and printing expenses		95,674		114,801		120,551
Depreciation and amortization		101,595		113,638		121,570
Other operating expenses		404,347		415,682		411,621
Goodwill and other asset impairments (see Notes 1 and 4)		304,848		8,227		17,181
		1,301,913		1,064,229		1,093,904
OPERATING INCOME (LOSS)		(245,339)		82,323		120,944
NON-OPERATING (EXPENSE) INCOME:
Interest expense		(85,973)		(127,503)		(135,381)
Interest income		331		254		53
Equity income in unconsolidated companies, net		10,086		19,084		42,651
Gains related to equity investments		8,061		705,247		—
Gain (loss) on extinguishment of debt, net		1,167		(72,777)		(13,643)
Gain on sale of Miami property		—		—		12,938
Other — net		(292)		579		541
		(66,620)		524,884		(92,841)
Income (loss) from continuing operations before income taxes		(311,959)		607,207		28,103
Income tax provision (benefit)		(11,797)		231,230		11,659
INCOME (LOSS) FROM CONTINUING OPERATIONS		(300,162)		375,977		16,444
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAXES		—		(1,988)		2,359
NET INCOME (LOSS)	$	(300,162)	$	373,989	$	18,803
Net income (loss) per common share:
Basic:
Income (loss) from continuing operations	$	(3.47)	$	4.33	$	0.19
Loss from discontinued operations		—		(0.02)		0.03
Net income (loss) per share	$	(3.47)	$	4.31	$	0.22
Diluted:
Income (loss) from continuing operations	$	(3.47)	$	4.26	$	0.19
Loss from discontinued operations		—		(0.03)		0.03
Net income (loss) per share	$	(3.47)	$	4.23	$	0.22
Weighted average number of common shares used
to calculate basic and diluted earnings per share:
Basic		86,591		86,797		86,201
Diluted		86,591		88,357		87,136

See notes to consolidated financial statements.

43

THE MCCLATCHY COMPANY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Amounts in thousands)

	Years Ended
	December 27,		December 28,		December 29,
	2015		2014		2013
NET INCOME (LOSS)	$	(300,162)	$	373,989	$	18,803
OTHER COMPREHENSIVE INCOME (LOSS):
Pension and post retirement plans:
Change in pension and post-retirement benefit plans, net of taxes of $2,936,  $73,922 and $(117,853)		(4,404)		(110,883)		176,779
Investment in unconsolidated companies:
Other comprehensive income (loss), net of taxes of $534,  $546, and $243		(801)		(819)		(364)
Other comprehensive income (loss)		(5,205)		(111,702)		176,415
Comprehensive income (loss)	$	(305,367)	$	262,287	$	195,218

See notes to consolidated financial statements.

44

THE MCCLATCHY COMPANY

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share amounts)

	December 27,		December 28,
	2015		2014
ASSETS
Current assets:
Cash and cash equivalents	$	9,332	$	220,861
Trade receivables (net of allowances of $4,451 in 2015 and $5,900 in 2014)		138,153		144,565
Other receivables		16,367		36,780
Newsprint, ink and other inventories		16,659		19,491
Assets held for sale		5,357		173
Other current assets		19,194		14,945
		205,062		436,815
Property, plant and equipment, net		364,219		404,238
Intangible assets:
Identifiable intangibles — net		348,651		410,915
Goodwill		705,174		996,115
		1,053,825		1,407,030
Investments and other assets:
Investments in unconsolidated companies		233,538		230,473
Deferred income taxes		1,312		—
Other assets		65,078		62,160
		299,928		292,633
	$	1,923,034	$	2,540,716
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	41,751	$	49,095
Accrued pension liabilities		8,450		8,529
Accrued compensation		29,410		32,912
Income taxes payable		687		186,805
Unearned revenue		60,811		62,035
Accrued interest		9,423		10,592
Other accrued liabilities		15,195		14,957
		165,727		364,925
Non-current liabilities:
Long-term debt		905,425		994,812
Deferred income taxes		—		25,108
Pension and postretirement obligations		581,852		574,024
Financing obligations		32,398		34,551
Other long-term obligations		44,869		43,911
		1,564,544		1,672,406
Commitments and contingencies
Stockholders’ equity:
Common stock $.01 par value:
Class A (authorized 200,000,000 shares, issued 58,782,535 in 2015 and 62,600,676 in 2014)		588		626
Class B (authorized 60,000,000 shares, issued 24,431,962 in 2015 and 24,585,962 in 2014)		244		246
Additional paid-in-capital		2,219,481		2,222,675
Accumulated deficit		(1,603,546)		(1,303,384)
Treasury stock at cost, 1,652,165 shares in 2015 and 45,374 shares in 2014		(2,196)		(175)
Accumulated other comprehensive loss		(421,808)		(416,603)
		192,763		503,385
	$	1,923,034	$	2,540,716

See notes to consolidated financial statements.

45

THE MCCLATCHY COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

	Years Ended
	December 27,		December 28,		December 29,
	2015		2014		2013
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(300,162)	$	373,989	$	18,803
Less income (loss) from discontinued operations, net of tax		—		(1,988)		2,359
Income (loss) from continuing operations		(300,162)		375,977		16,444
Reconciliation to net cash provided by (used in) operating activities:
Depreciation and amortization		101,595		113,638		121,570
(Gains) loss on disposal of equipment (excluding asset impairments)		347		(918)		(1,914)
Contribution to qualified defined benefit pension plan		—		(25,000)		(7,600)
Retirement benefit expense		9,971		4,632		12,162
Stock-based compensation expense		3,178		3,479		3,481
Deferred income taxes		(23,087)		(32,233)		(9,774)
Equity income in unconsolidated companies		(10,086)		(19,084)		(42,651)
Gains related to equity investments		(8,061)		(705,247)		—
Distributions of income from equity investments		7,500		160,707		39,504
(Gain) loss on extinguishment of debt, net		(1,167)		72,777		13,643
Gain on disposal of Miami property		—		—		(12,938)
Goodwill and other asset impairments		304,848		8,227		17,181
Other		(5,501)		(4,137)		(3,865)
Changes in certain assets and liabilities:
Trade receivables		6,412		19,390		9,877
Inventories		2,832		3,822		3,534
Other assets		(7,707)		(111)		(391)
Accounts payable		(7,344)		(1,870)		1,085
Accrued compensation		(3,529)		(6,291)		(57)
Income taxes		(190,581)		186,208		3,745
Accrued interest		(1,169)		(4,452)		(3,631)
Other liabilities		(818)		(6,333)		(5,824)
Net cash provided by (used in) continuing operations		(122,529)		143,181		153,581
Net cash provided by (used in) discontinued operations		—		(37)		2,459
Net cash provided by (used in) operating activities		(122,529)		143,144		156,040
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment		(18,605)		(23,441)		(33,273)
Proceeds from sale of property, plant and equipment and other		414		10,301		4,703
Purchase of certificates of deposit		—		(33,483)		—
Proceeds from redemption of certificates of deposit		—		—		2,210
Purchase of insurance-related deposits		—		(6,770)		—
Proceeds from return of insurance-related deposit		—		—		6,400
Distributions from equity investments		7,428		1,621		2,932
Contributions to equity investments		(1,583)		(4,158)		(1,319)
Proceeds from sale of equity investments		26,186		607,942		—
Other-net		—		—		(1,500)
Net cash provided by (used in) continuing operations		13,840		552,012		(19,847)
Net cash provided by (used in) discontinued operations		—		32,953		(200)
Net cash provided by (used in) investing activities		13,840		584,965		(20,047)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase of public notes		(92,254)		(584,366)		(165,549)
Purchase of treasury shares		(8,434)		(7,603)		(1,793)
Other		(2,152)		3,910		(928)
Net cash used in financing activities		(102,840)		(588,059)		(168,270)
Increase (decrease) in cash and cash equivalents		(211,529)		140,050		(32,277)
Cash and cash equivalents at beginning of period		220,861		80,811		113,088
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	9,332	$	220,861	$	80,811

See notes to consolidated financial statements.

46

THE MCCLATCHY COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Amounts in thousands, except share and per share amounts)

	Common Stock								Accumulated
	Class A		Class B		Additional				Other
	$.01 par		$.01 par		Paid-In		Accumulated		Comprehensive		Treasury
	value		value		Capital		Deficit		Income (Loss)		Stock		Total
Balance at December 30, 2012	$	611	$	248	$	2,219,163	$	(1,696,176)	$	(481,316)	$	(29)	$	42,501
Net income		—		—		—		18,803		—		—		18,803
Other comprehensive income		—		—		—		—		176,415		—		176,415
Issuance of 1,030,750 Class A shares under stock plans		10		—		927		—		—		—		937
Stock compensation expense		—		—		3,523		—		—		—		3,523
Purchase of 580,219 shares of treasury stock		—		—		—		—		—		(1,793)		(1,793)
Retirement of 575,046 shares of treasury stock		(6)		—		(1,779)		—		—		1,785		—
Balance at December 29, 2013		615		248		2,221,834		(1,677,373)		(304,901)		(37)		240,386
Net income		—		—		—		373,989		—		—		373,989
Other comprehensive loss		—		—		—		—		(111,702)		—		(111,702)
Conversion of 215,000 Class B shares to Class A shares		2		(2)		—		—		—		—		—
Issuance of 2,391,100 Class A shares under stock plans		24		—		4,784		—		—		—		4,808
Stock compensation expense		—		—		3,507		—		—		—		3,507
Purchase of 1,594,115 shares of treasury stock		—		—		—		—		—		(7,603)		(7,603)
Retirement of 1,559,948 shares of treasury stock		(15)		—		(7,450)		—		—		7,465		—
Balance at December 28, 2014		626		246		2,222,675		(1,303,384)		(416,603)		(175)		503,385
Net loss		—		—		—		(300,162)		—		—		(300,162)
Other comprehensive loss		—		—		—		—		(5,205)		—		(5,205)
Conversion of 154,000 Class B shares to Class A shares		2		(2)		—		—		—		—		—
Issuance of 915,550 Class A shares under stock plans		9		—		(8)		—		—		—		1
Stock compensation expense		—		—		3,178		—		—		—		3,178
Purchase of 6,494,482 shares of treasury stock		—		—		—		—		—		(8,434)		(8,434)
Retirement of 4,887,691 shares of treasury stock		(49)		—		(6,364)		—		—		6,413		—
Balance at December 27, 2015	$	588	$	244	$	2,219,481	$	(1,603,546)	$	(421,808)	$	(2,196)	$	192,763

See notes to consolidated financial statements.

47

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

1.  SIGNIFICANT ACCOUNTING POLICIES

The McClatchy Company (the “Company,” “we,” “us” or “our”) is a 21st century news and information publisher of publications such as the Miami Herald, The Kansas City Star, The Sacramento Bee, The Charlotte Observer,  The (Raleigh) News and Observer, and the (Fort Worth) Star-Telegram. We operate 29 media companies in 28 U.S. markets in 14 states, providing each of our communities with high-quality news and advertising services in a wide array of digital and print formats. We are headquartered in Sacramento, California, and our Class A Common Stock is listed on the New York Stock Exchange under the symbol MNI.

We also own 15.0% of CareerBuilder, LLC, which operates the nation’s largest online job website, CareerBuilder.com; 33.3% of HomeFinder, LLC, which operates the online real estate website HomeFinder.com; as well as certain other digital company investments. See Note 3 for additional discussion.

Our fiscal year ends on the last Sunday in December. The years ended December 27, 2015, December 28, 2014, and December 29, 2013, consist of 52-week periods.

Preparation of the financial statements in conformity with accounting principles generally accepted in the United States and pursuant to the rules and regulation of the Securities and Exchange Commission requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. The consolidated financial statements include the Company and our subsidiaries. Intercompany items and transactions are eliminated. For purposes of presentation only, we updated the term “circulation” to “audience” as it relates to our discussion of revenues. The term “circulation” was used in prior filings with the Securities and Exchange Commission and no other changes were made in conjunction with this language change.

Changes in basis of presentation

As discussed more fully in Recently Adopted Accounting Pronouncements below, we elected to early adopt authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) related to the presentation of deferred income taxes and debt issuance costs. As required by this guidance, we have recast our consolidated balance sheet as of December 28, 2014, and certain related footnotes, to conform to the presentation as of December 27, 2015.

Revenue recognition

We recognize revenues (i) from advertising placed in a newspaper, a website and/or a mobile service over the advertising contract period or as services are delivered, as appropriate; (ii) from the sale of certain third party digital advertising products and services on a net basis, with wholesale fees reported as a reduction of the associated revenues; and (iii) for audience subscriptions as newspapers and access to online sites are delivered over the applicable subscription term. Audience revenues are recorded net of direct delivery costs for contracts that are not on a “fee-for-service” arrangement. Audience revenues on our “fee-for-service” contracts are recorded on a gross basis and associated delivery costs are recorded as other operating expenses.

We enter into certain revenue transactions, primarily related to advertising contracts and circulation subscriptions that are considered multiple element arrangements (arrangements with more than one deliverable). As such we must: (i) determine whether and when each element has been delivered; (ii) determine fair value of each element using the selling price hierarchy of vendor‑specific objective evidence of fair value, third party evidence or best estimated selling price, as applicable and (iii) allocate the total price among the various elements based on the relative selling price method.

Other revenues are recognized when the related product or service has been delivered. Revenues are recorded net of estimated incentives, including special pricing agreements, promotions and other volume‑based incentives and net of sales tax collected from the customer. Revisions to these estimates are charged to revenues in the period in which the facts that give rise to the revision become known.

48

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

Concentrations of credit risks

Financial instruments, which potentially subject us to concentrations of credit risks, are principally cash and cash equivalents and trade accounts receivables. Cash and cash equivalents are placed with major financial institutions. As of December 27, 2015, substantially all of our cash and cash equivalents are in excess of the FDIC insured limits. We routinely assess the financial strength of significant customers and this assessment, combined with the large number and geographic diversity of our customers, limits our concentration of risk with respect to trade accounts receivable. We have not experienced any losses related to amounts in excess of FDIC limits.

Allowance for doubtful accounts

We maintain an allowance account for estimated losses resulting from the risk that our customers will not make required payments. At certain of our newspapers we establish our allowances based on collection experience, aging of our receivables and significant individual account credit risk. At the remaining newspapers we use the aging of accounts receivable, reserving for all accounts due 90 days or longer, to establish allowances for losses on accounts receivable; however, if we become aware that the financial condition of specific customers has deteriorated, additional allowances are provided.

We provide an allowance for doubtful accounts as follows:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Balance at beginning of year	$	5,900	$	6,040	$	5,920
Charged to costs and expenses		8,181		9,305		8,481
Amounts written off		(9,630)		(9,229)		(8,361)
Disposition of discontinued operations		—		(216)		—
Balance at end of year	$	4,451	$	5,900	$	6,040

Newsprint, ink and other inventories

Newsprint, ink and other inventories are stated at the lower of cost (based principally on the first‑in, first‑out method) or current market value. During 2014, we recorded a $2.0 million write‑down of non-newsprint inventory.

Property, plant and equipment

Property, plant and equipment (“PP&E”) are recorded at cost. Additions and substantial improvements, as well as interest expense incurred during construction, are capitalized. Capitalized interest was not material in 2015, 2014 or 2013. Expenditures for maintenance and repairs are charged to expense as incurred. When PP&E is sold or retired, the asset and related accumulated depreciation are removed from the accounts and the associated gain or loss is recognized.

Property, plant and equipment consisted of the following:

	December 27,		December 28,		Estimated
(in thousands)	2015		2014		Useful Lives
Land	$	85,721	$	89,083
Building and improvements		332,502		337,727	5	-	60	years
Equipment		648,206		691,289	2	-	25	years	(1)
Construction in process		7,090		2,696
		1,073,519		1,120,795
Less accumulated depreciation		(709,300)		(716,557)
Property, plant and equipment, net	$	364,219	$	404,238

⁽¹⁾ Presses are 9 - 25 years and other equipment is 2 - 15 years

49

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

We record depreciation using the straight‑line method over estimated useful lives. The useful lives are estimated at the time the assets are acquired and are based on historical experience with similar assets and anticipated technological changes. Our depreciation expense was $53.2 million, $60.7 million and $64.4 million in 2015, 2014 and 2013, respectively.

We review the carrying amount of long‑lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events that result in an impairment review include the decision to close a location or a significant decrease in the operating performance of the long‑lived asset. Long‑lived assets are considered impaired if the estimated undiscounted future cash flows of the asset or asset group are less than the carrying amount. For impaired assets, we recognize a loss equal to the difference between the carrying amount of the asset or asset group and its estimated fair value, which is recorded in operating expenses in the consolidated statements of operations. The estimated fair value of the asset or asset group is based on the discounted future cash flows of the asset or asset group. The asset group is defined as the lowest level for which identifiable cash flows are available.

During 2015 we incurred $10.3 million in accelerated depreciation related to the production equipment associated with outsourcing our printing process at a few of our newspapers. During 2014 we incurred $13.5 million in accelerated depreciation (i) related to the production equipment associated with outsourcing our printing process at one of our newspapers and (ii) resulting from moving the printing operations for another newspaper to a newly purchased production facility.  

Assets held for sale

During 2015 we began to actively market for sale a parking lot at one of our newspapers and a parking structure at another newspaper. No impairment charges were incurred during 2015 as a result of placing these assets in assets held for sale during 2015.

Investments in unconsolidated companies

We use the equity method of accounting for our investments in, and earnings or losses of, companies that we do not control but over which we do exert significant influence. We consider whether the fair values of any of our equity method investments have declined below their carrying value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If we consider any decline to be other than temporary (based on various factors, including historical financial results and the overall health of the investee), then a write‑down would be recorded to estimated fair value. See Note 3 for discussion of investments in unconsolidated companies.

Segment reporting

Our primary business is the publication of newspapers and related digital site and direct marketing products. We have two operating segments that we aggregate into a single reportable segment because each has similar economic characteristics, products, customers and distribution methods. Our operating segments are based on how our chief executive officer, who is also our Chief Operating Decision Maker (“CODM”), makes decisions about allocating resources and assessing performance. The CODM is provided discrete financial information for the two operating segments. Each operating segment consists of a group of newspapers and, effective July 1, 2015, following the retirement of a segment manager, both operating segments report to the same segment manager. There was no change to our single reportable segment as a result of the changes to our operating segments. Effective July 1, 2015, one of our operating segments (“Western Segment”) consists of our newspaper operations in California, the Northwest, and the Midwest, while the other operating segment (“Eastern Segment”) consists primarily of newspaper operations in the Southeast and Florida.

Goodwill and intangible impairment

We test for impairment of goodwill annually, at year‑end, or whenever events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The required two‑step approach uses accounting judgments and estimates of future operating results. Changes in estimates or the application of alternative assumptions could produce significantly different results. Impairment testing is done at a reporting unit level. We perform this testing on operating segments, which are also considered our reporting units. An impairment loss generally is recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit. The fair value of our reporting units is determined using a combination of a discounted cash flow model and market based approaches. The estimates and judgments that most significantly affect the fair value calculation are assumptions

50

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

related to revenue growth, newsprint prices, compensation levels, discount rate and private and public market trading multiples for newspaper assets for the market based approach. We consider current market capitalization, based upon the recent stock market prices, plus an estimated control premium in determining the reasonableness of the aggregate fair value of the reporting units. We determined an impairment charge of $290.9 million in 2015 was required. We determined that no impairment charge was required in 2014 or 2013. Also see Note 4.

Newspaper mastheads (newspaper titles and website domain names) are not subject to amortization and are tested for impairment annually, at year‑end, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of each newspaper masthead with its carrying amount. We use a relief from royalty approach which utilizes a discounted cash flow model, as discussed above, to determine the fair value of each newspaper masthead. We determined that an impairment charges of $13.9 million, $5.2 million and $5.3 million in 2015, 2014 and 2013, respectively, were required. Also see Note 4.

Long‑lived assets such as intangible assets (primarily advertiser and subscriber lists) are amortized and tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. The carrying amount of each asset group is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use of such asset group. We had no impairment of long‑lived assets subject to amortization during 2015, 2014 or 2013.

Stock‑based compensation

All stock‑based payments, including grants of stock appreciation rights, restricted stock units and common stock under equity incentive plans, are recognized in the financial statements based on their fair values. At December 27, 2015, we had two stock‑based compensation plans. See Note 10.

Income taxes

We account for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.

Current accounting standards in the United States prescribe a recognition threshold and measurement of a tax position taken or expected to be taken in an enterprise’s tax returns. We recognize accrued interest related to unrecognized tax benefits in interest expense. Accrued penalties are recognized as a component of income tax expense.

Fair value of financial instruments

We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

Level 1	—	Unadjusted quoted prices available in active markets for identical investments as of the reporting date.
Level 2	—	Observable inputs to the valuation methodology are other than Level 1 inputs and are either directly or indirectly observable as of the reporting date and fair value can be determined through the use of models or other valuation methodologies.
Level 3	—	Inputs to the valuation methodology are unobservable inputs in situations where there is little or no market activity for the asset or liability, and the reporting entity makes estimates and assumptions related to the pricing of the asset or liability including assumptions regarding risk.

Our policy is to recognize significant transfers between levels at the actual date of the event or circumstance that caused the transfer.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

51

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

Cash and cash equivalents, accounts receivable, other current assets, accounts payable and other current liabilities. As of December 27, 2015, and December 28, 2014, the carrying amount of these items approximates fair value because of the short maturity of these financial instruments.

Long‑term debt. The fair value of long‑term debt is determined using quoted market prices and other inputs that were derived from available market information including the current market activity of our publicly‑traded notes and bank debt, trends in investor demand and market values of comparable publicly‑traded debt. These are considered to be Level 2 inputs under the fair value measurements and disclosure guidance, and may not be representative of actual. At December 27, 2015, and December 28, 2014, the estimated fair value of long‑term debt was $729.8 million and $994.8 million, respectively. At December 27, 2015, and December 28, 2014, the carrying value of long‑term debt was $905.4 million and $1.0 billion, respectively.

Pension plan. As of December 27, 2015, and December 28, 2014, we had assets related to our qualified defined benefit pension plan measured at fair value. The required disclosures regarding such assets are presented in Note 7.

Certain assets are measured at fair value on a nonrecurring basis; that is, they are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). Our non‑financial assets measured at fair value on a nonrecurring basis in the accompanying consolidated balance sheet as of December 27, 2015, were assets held for sale, goodwill, intangible assets not subject to amortization and equity method investments. All of these were measured using Level 3 inputs. We utilize valuation techniques that seek to maximize the use of observable inputs and minimize the use of unobservable inputs. The significant unobservable inputs include our expected cash flows and discount rate that we estimate market participants would seek for bearing the risk associated with such assets.

Accumulated other comprehensive loss

We record changes in our net assets from non‑owner sources in our consolidated statements of stockholders’ equity. Such changes relate primarily to valuing our pension liabilities, net of tax effects.

Our accumulated other comprehensive loss (“AOCL”) and reclassifications from AOCL, net of tax, consisted of the following:

			Other
	Minimum		Comprehensive
	Pension and		Loss
	Post-		Related to
	Retirement		Equity
(in thousands)	Liability		Investments		Total
Balance at December 29, 2013	$	(296,669)	$	(8,232)	$	(304,901)
Other comprehensive income (loss) before reclassifications		—		(819)		(819)
Amounts reclassified from AOCL		(110,883)		—		(110,883)
Other comprehensive income (loss)		(110,883)		(819)		(111,702)
Balance at December 28, 2014	$	(407,552)	$	(9,051)	$	(416,603)
Other comprehensive income (loss) before reclassifications		—		(801)		(801)
Amounts reclassified from AOCL		(4,404)		—		(4,404)
Other comprehensive income (loss)		(4,404)		(801)		(5,205)
Balance at December 27, 2015	$	(411,956)	$	(9,852)	$	(421,808)

52

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

	Amount Reclassified from AOCL (in thousands)
	Year Ended		Year Ended
	December 27,		December 28,		Affected Line in the
AOCL Component	2015		2014		Consolidated Statements of Operations
Minimum pension and post-retirement liability	$	(7,340)	$	(184,805)	Compensation
		2,936		73,922	Provision (benefit) for income taxes
	$	(4,404)	$	(110,883)	Net of tax

Earnings per share (EPS)

Basic EPS excludes dilution from common stock equivalents and reflects income divided by the weighted average number of common shares outstanding for the period. Diluted EPS is based upon the weighted average number of outstanding shares of common stock and dilutive common stock equivalents in the period. Common stock equivalents arise from dilutive stock options, restricted stock units and restricted stock and are computed using the treasury stock method. The weighted average anti‑dilutive stock options that could potentially dilute basic EPS in the future, but were not included in the weighted average share calculation consisted of the following:

	Years Ended
	December 27,	December 28,	December 29,
(shares in thousands)	2015	2014	2013
Anti-dilutive stock options	5,173	1,519	4,941

Recently Issued Accounting Pronouncements

In May 2014, the FASB issued Accounting Standards Update (“ASU”) ASU No. 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized. The new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. It is effective for us for annual and interim periods beginning on or after December 15, 2017, and early adoption is permitted for interim or annual reporting periods beginning after December 15, 2016. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

In August 2014, the FASB issued ASU No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” ASU 2014-15 requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnotes disclosures in certain circumstances. It is effective for us for annual and interim periods beginning on or after December 15, 2016, with early adoption permitted. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In February 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810); Amendments to the Consolidated Analysis,” which changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. It is effective for us for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-05, "Customer's Accounting for Fees Paid in a Cloud Computing Arrangement." ASU 2015-05 provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance does not change the accounting for service contracts. It is effective for us for interim and annual reporting periods beginning after December 15, 2015. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

53

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” ASU 2015-11 simplifies the measurement of inventory by requiring certain inventory to be measured at the “lower of cost and net realizable value” and options that currently exist for “market value” will be eliminated. The ASU defines net realizable value as the “estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.” It is effective for us for interim and annual reporting periods beginning after December 15, 2016. The standard should be applied prospectively with early adoption permitted. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” ASU 2016-01 addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 is effective for us for interim and annual reporting periods beginning after December 15, 2017. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, “Leases” (Accounting Standards Codification 842 (“ASC 842”)) and it replaces the existing guidance in ASC 840, “Leases.”  ASC 842 requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. The new lease standard does not substantially change lessor accounting. It is effective for us for interim and annual reporting periods beginning after December 15, 2018,with early adoption permitted. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

Recently Adopted Accounting Pronouncements

In April 2014, the FASB issued ASU No. 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which raised the threshold for a disposal to qualify as a discontinued operation and required new disclosures of both discontinued operations and certain other disposals that did not meet the definition of a discontinued operation. This guidance was effective for us at the beginning of 2015.

In April 2015 the FASB issued ASU No. 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which amended existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability instead of deferred charges. It was effective for us for annual and interim periods beginning on or after December 15, 2015, however early adoption was permitted. In August 2015, the FASB issued ASU No. 2015-15, “Interest-Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of Credit Arrangements-Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting,” to clarify that an entity may elect to present debt issuance costs related to a line-of-credit arrangement as an asset, regardless of whether or not there are any outstanding borrowings on the line-of-credit arrangement. We early adopted these standards retrospectively and elected to present the debt issuance costs related to our line-of credit arrangement, combined with the other debt issuance costs on our term loan debt, as a reduction in long-term debt. As of December 28, 2014, we reclassified unamortized debt issuance costs of $12.1 million from other assets to a reduction in long-term debt on the consolidated balance sheet.

In April 2015 the FASB issued ASU No. 2015-04, "Compensation – Retirement Benefits: Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets," which provided practical expedient, which permitted a reporting entity with a fiscal year-end that does not coincide with a month-end, to measure defined benefit plan assets and obligations using the month-end that is closest to the entity’s fiscal year-end and apply that practical expedient consistently from year to year. It is effective for us for interim and annual reporting periods beginning after December 15, 2015, with early application permitted. We early adopted this standard and it did not have a material impact on our consolidated financial statements.

In November 2015 the FASB issued ASU No. 2015-17, "Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes," which simplifies the presentation of deferred income taxes by requiring deferred tax assets and liabilities to be classified as noncurrent on the balance sheet. It was effective for us for interim and annual reporting periods beginning

54

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

after December 15, 2015, with early adoption permitted. We early adopted this standard retrospectively, and reclassified our current deferred income taxes to net them with noncurrent deferred income taxes for all periods presented. As of December 28, 2014, we reclassified deferred income taxes of $1.1 million from current assets to a reduction in deferred income taxes in noncurrent liabilities on the consolidated balance sheet.

2.  DIVESTITURE

On May 5, 2014, we completed the sale of the outstanding capital stock of Anchorage Daily News, Inc. (“Anchorage”) to an assignee of Alaska Dispatch Publishing, LLC for $34.0 million in cash. In accordance with the FASB Accounting Standards Codification (“ASC”) 205-20, “Discontinued Operations,” the financial results of Anchorage have been reported as a discontinued operation in our consolidated financial statements for the periods presented.

The following table summarizes the financial information for the Anchorage’s operations for 2014 and 2013:

	Year Ended
	December 28,		December 29,
(in thousands)	2014		2013
Revenues	$	9,071	$	27,389
Loss from discontinued operations, before taxes	$	(203)	$	3,956
Income tax benefit		251		1,597
Loss from discontinued operations, net of tax, before loss on sale	$	(454)	$	2,359
Gain (loss) on sale of discontinued operations	$	5,391	$	—
Income tax provision		6,925		—
Loss on sale of discontinued operations, net of tax		(1,534)		—
Loss from discontinued operations, net of tax	$	(1,988)	$	2,359

3.  INVESTMENTS IN UNCONSOLIDATED COMPANIES

Our ownership interest and investment in unconsolidated companies consisted of the following:

(in thousands)	% Ownership	December 27,		December 28,
Company	Interest	2015		2014
CareerBuilder, LLC	15.0	$	230,170	$	226,965
Other	Various		3,368		3,508
		$	233,538	$	230,473

Classified Ventures, LLC

On April 1, 2014, Classified Ventures, LLC (“Classified Ventures”) sold its Apartments.com business for $585 million. Accordingly, during 2014, we recorded our share of the net gain of $144.2 million, before taxes, as gains related to equity investments in our consolidated statements of operations. On April 1, 2014, we received a cash distribution of $146.9 million from Classified Ventures, which is equal to our share of the net proceeds.

On October 1, 2014, we, along with Tribune Media Company, Graham Holdings Company and A. H. Belo Corporation (the “Selling Partners”) sold all of the Selling Partners’ ownership interests in Classified Ventures to TEGNA, Inc. (formerly Gannett Co., Inc.) for a price that valued Classified Ventures at $2.5 billion. We recorded gain on sale of our ownership interest in Classified Ventures of $559.3 million, before taxes, during the fourth quarter of 2014. Our portion of the cash proceeds, net of transaction costs, was $631.8 million. Pursuant to the sale agreement, $25.6 million of net proceeds was being held in escrow until October 1, 2015. On October 1, 2014, we received our portion of the net cash proceeds, less the escrow amount, of $606.2 million. Upon the closing of the transaction, we entered into a new, five-year affiliate agreement with Cars.com that will allow us to continue to sell Cars.com products and services exclusively in our local markets.

In the fourth quarter of 2015, we received the $25.6 million escrow balance from the escrow account.

55

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

During the first quarter of 2015, we received $0.6 million from Classified Ventures as a result of the final working capital adjustment from our sale of Classified Ventures in the fourth quarter of 2014. In addition, in April 2015, we received a final cash distribution of $7.5 million from Classified Ventures. Both of these transactions were recorded as gains related to equity investments during 2015, because the company has no continuing ownership interest in Classified Ventures (see above).

McClatchy-Tribune Information Services

On May 7, 2014, we transferred our partnership interest in McClatchy-Tribune Information Services (“MCT”) to TCA News Service, LLC (“TCA”) for cash and future newswire content. Concurrently, we entered into a contributor agreement with MCT pursuant to which we both continue to be a contributor of newswire content to MCT for an agreed upon rate and we will receive newswire content from MCT or its successor at no cost for approximately 10 years. We recognized a $3.1 million intangible asset in the consolidated balance sheets with respect to the value of the content we will receive from MCT at no cost under these agreements, and a $1.7 million gain on sale of the equity investment in gains related to equity investments in the consolidated statements of operations.

During 2015 and 2014, we recorded write‑downs of $8.2 million and $7.8 million, respectively, which reduced our equity income in unconsolidated companies, net, in the consolidated statements of operations. The write-down in 2015 was primarily related to CareerBuilder, LLC, which recorded a non-cash, goodwill impairment charge related to their international reporting unit in the fourth quarter of 2015. Our portion of that impairment charge was $7.5 million. The write-down in 2014 was primarily our interest in the Ponderay Newsprint Company.

We received dividends and other equity distributions from our investments in unconsolidated companies as follows:

	Years Ended
	December 27,		December 28,
(in thousands)	2015		2014
CareerBuilder, LLC	$	7,500	$	6,750
Other		7,460		155,576
	$	14,960	$	162,326

For 2015, the $15.0 million in total distributions from our equity investments included $7.5 million from CareerBuilder LLC, which represented a return on investment and was recorded as an operating activity, and the $7.5 million from Classified Ventures (see above) was considered a return of investment because there were no cumulative earnings from the investee and, therefore, was treated as an investing activity on our consolidated statements of cash flows.

For 2014, the $162.3 million in total distributions from our equity investments included $160.7 million, which represented a return on investment, was shown as an operating activity, and the remaining $1.6 million, which exceeded the cumulative earnings from an investee and was considered a return of investment and therefore was treated as an investing activity in our consolidated statements of cash flows.

We have a 27% general partnership interest in Ponderay Newsprint Company (“Ponderay”) and we purchased some of our newsprint supply from Ponderay during 2015, 2014 and 2013. Our investment in Ponderay is zero as a result of a write off in 2014 and accumulative losses exceeding our carrying value. No future income or losses from Ponderay will be recorded until our carrying value on our balance sheet is restored through future earnings by Ponderay.

We have a 49.5% ownership interest in The Seattle Times Company (“STC”). Our investment in STC is zero as a result of accumulative losses in previous years exceeding our carrying value. No future income or losses from STC will be recorded until our carrying value on our balance sheet is restored through future earnings by STC.

We also incurred expenses related to the purchase of products and services provided by these companies. We purchase newsprint from Ponderay and we incur wholesale fees from CareerBuilder, LLC for the uploading and hosting of online advertising on behalf of our newspapers’ advertisers. We record these expenses for CareerBuilder, LLC as a reduction to the associated digital classified advertising revenues and expenses related to Ponderay are recorded in operating expenses. The following table summarizes expenses incurred for products and services provided by unconsolidated companies:

56

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
CareerBuilder, LLC	$	1,001	$	1,024	$	1,109
Ponderay (general partnership)		8,200		10,433		16,313

As of December 27, 2015, and December 28, 2014, we had approximately $1.0 million and $1.5 million, respectively, payable collectively to CareerBuilder, LLC and Ponderay.

The tables below present the summarized financial information, as provided to us by these investees, for our investments in unconsolidated companies on a combined basis:

	December 27,		December 28,
(in thousands)	2015		2014
Current assets	$	365,993	$	359,349
Noncurrent assets		540,629		577,837
Current liabilities		236,630		247,825
Noncurrent liabilities		228,209		180,764
Equity		441,783		508,597

	Year ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Net revenues	$	988,871	$	1,368,593	$	1,512,534
Gross profit		843,680		1,155,091		1,262,104
Operating income		38,561		146,809		231,952
Net income		39,143		151,519		247,441

4.  INTANGIBLE ASSETS AND GOODWILL

Changes in identifiable intangible assets and goodwill consisted of the following:

	December 28,		Acquired		Disposition		Impairment		Amortization		December 27,
(in thousands)	2014		Adjustment		Adjustment		Charges		Expense		2015
Intangible assets subject to amortization	$	833,254	$	—	$	—	$	—	$	—	$	833,254
Accumulated amortization		(615,378)		—		—		—		(48,357)		(663,735)
		217,876		—		—		—		(48,357)		169,519
Mastheads		193,039		—		—		(13,907)		—		179,132
Goodwill		996,115		—		—		(290,941)		—		705,174
Total	$	1,407,030	$	—	$	—	$	(304,848)	$	(48,357)	$	1,053,825

	December 29,		Acquired		Disposition		Impairment		Amortization		December 28,
(in thousands)	2013		Adjustment		Adjustment		Charges		Expense		2014
Intangible assets subject to amortization	$	835,461	$	3,100	$	(5,307)	$	—	$	—	$	833,254
Accumulated amortization		(567,737)		—		5,307		—		(52,948)		(615,378)
		267,724		3,100		—		—		(52,948)		217,876
Mastheads		198,242		—		—		(5,203)		—		193,039
Goodwill		1,013,002		—		(16,887)		—		—		996,115
Total	$	1,478,968	$	3,100	$	(16,887)	$	(5,203)	$	(52,948)	$	1,407,030

During the quarter ended June 28, 2015, we performed interim tests of impairment of goodwill and intangible newspaper mastheads due to the continuing challenging business conditions and the resulting weakness in our stock price. The fair

57

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

values of our reporting units for goodwill impairment testing and individual newspaper mastheads were estimated using the present value of expected future cash flows, using estimates, judgments and assumptions (see Note 1) that we believe were appropriate in the circumstances. As a result, we recorded an impairment charge related to goodwill of $290.9 million and an intangible newspaper masthead impairment charge of $9.5 million in the quarter ended June 28, 2015, which were recorded in the goodwill and other asset impairments line item on our consolidated statements of operations. In addition, based on our annual impairment testing of goodwill and intangible newspaper mastheads at December 27, 2015, we recorded an additional $4.4 million in masthead impairments, which was recorded in the goodwill and other asset impairment line item on our consolidated statements of operations.

Based on our annual impairment testing of goodwill and intangible newspaper mastheads at December 28, 2014, we recorded $5.2 million in masthead impairments, which was recorded in the goodwill and other asset impairment line item on our consolidated statements of operations.

During 2014, we sold Anchorage, resulting in the removal of the applicable intangible assets subject to amortization, accumulated amortization and goodwill from our consolidated balance sheet. In addition, in 2014 we acquired an intangible asset related to an agreement we entered into with MCT under which we will receive MCT newswire content, at no cost, over approximately 10 years.

Accumulated changes in indefinite lived intangible assets and goodwill as of December 27, 2015, and December 28, 2014, consisted of the following:

	December 27, 2015						December 28, 2014
	Original Gross		Accumulated		Carrying		Original Gross		Accumulated		Carrying
(in thousands)	Amount		Impairment		Amount		Amount		Impairment		Amount
Mastheads	$	683,000	$	(503,868)	$	179,132	$	683,000	$	(489,961)	$	193,039
Goodwill		3,571,111		(2,865,937)		705,174		3,571,111		(2,574,996)		996,115
Total	$	4,254,111	$	(3,369,805)	$	884,306	$	4,254,111	$	(3,064,957)	$	1,189,154

Amortization expense was $48.4 million, $52.9 million and $57.2 million in 2015, 2014 and 2013, respectively. The estimated amortization expense for the five succeeding fiscal years is as follows:

	Amortization
	Expense
Year	(in thousands)
2016	$	47,986
2017		48,907
2018		47,275
2019		23,769
2020		418

5.  LONG‑TERM DEBT

All of our long‑term debt is in fixed rate obligations. As of December 27, 2015, and December 28, 2014, our outstanding long‑term debt consisted of senior secured notes and unsecured notes. They are stated net of unamortized debt issuance costs and unamortized discounts, if applicable, totaling $31.9 million and $37.6 million as of December 27, 2015, and December 28, 2014, respectively. The unamortized discounts resulted from recording assumed liabilities at fair value during a 2006 acquisition.

The face values of the notes, as well as the carrying values are as follows:

Face Value at	Carrying Value
December 27,	December 27,	December 28,

58

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

(in thousands)	2015		2015		2014
Notes:
9.00% senior secured notes due in 2022	$	516,415	$	506,571	$	543,640
5.750% notes due in 2017		55,442		54,551		108,489
7.150% debentures due in 2027		89,188		84,469		84,076
6.875% debentures due in 2029		276,230		259,834		258,607
Long-term debt	$	937,275	$	905,425	$	994,812

Debt Repurchases and Extinguishment of Debt

During the year ended December 27, 2015, we repurchased a total of $95.2 million of notes through privately negotiated transactions, as follows:

(in thousands)	Face Value
9.00% senior secured notes due in 2022	$	39,370
5.750% notes due in 2017		55,857
Total notes repurchased	$	95,227

We recorded a gain on extinguishment of debt of $1.2 million in 2015, and we recorded a loss on extinguishment of debt of $72.8 million and $13.6 million in 2014 and 2013, respectively.

During 2015, we repurchased $95.2 million aggregate principal of outstanding notes in privately negotiated transactions. We repurchased these notes at either par or at a price lower than par value, which was partially offset by the write-off of historical discounts and unamortized issuance costs related to these notes, as applicable, which resulted in a net gain on extinguishment of debt of $1.2 million in 2015.

During 2014, we repurchased $494.2 million aggregate principal amount of various series of our outstanding notes. We repurchased these notes at a price higher than par value and wrote off historical discounts and unamortized issuance costs related to these notes, which resulted in a loss on extinguishment of debt of $72.8 million in 2014. During 2013, we redeemed or repurchased $155.9 million aggregate principal amount of various series of our outstanding notes. We redeemed or repurchased these notes at a price higher than par value, and wrote off historical discounts and unamortized issuance costs related to these notes, which resulted in a loss on extinguishment of debt of $13.6 million in 2013.

Credit Agreement

Our Third Amended and Restated Credit Agreement, dated as of December 18, 2012, and as amended on October 21, 2014, (“Credit Agreement”) is secured by a first-priority security interest in certain of our assets as described below. The Credit Agreement, among other things, provides for commitments of $65 million and a maturity date of December 18, 2019. On October 21, 2014, we entered into a Collateralized Issuance and Reimbursement Agreement (“LC Agreement”). Pursuant to the terms of the LC Agreement, we may request letters of credit be issued on our behalf in an aggregate face amount not to exceed $35.0 million. We are required to provide cash collateral equal to 101% of the aggregate undrawn stated amount of each outstanding letter of credit.

As of December 27, 2015, there were $33.0 million face amount of letters of credit outstanding under the LC Agreement and no amounts drawn under the Credit Agreement. The amounts of standby letters of credit declined to $31.0 million in January 2016.

Under the Credit Agreement, we may borrow at either the London Interbank Offered Rate plus a spread ranging from 275 basis points to 425 basis points, or at a base rate plus a spread ranging from 175 basis points to 325 basis points, in each case based upon our consolidated total leverage ratio. The Credit Agreement provides for a commitment fee payable on the unused revolving credit ranging from 50 basis points to 62.5 basis points, based upon our consolidated total leverage ratio.

59

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

Senior Secured Notes and Indenture

In December 2012, we issued 9.00% Senior Secured Notes due in 2022 (“9.00% Notes”). Substantially all of our subsidiaries guarantee the obligations under the 9.00% Notes and the Credit Agreement. We own 100% of each of the guarantor subsidiaries and we have no significant independent assets or operations separate from the subsidiaries that guarantee our 9.00% Notes and the Credit Agreement. The guarantees provided by the guarantor subsidiaries are full and unconditional and joint and several, and the subsidiaries, other than the subsidiary guarantors, are minor.

In addition, we have granted a security interest to the banks that are a party to the Credit Agreement and the trustee under the indenture governing the 9.00% Notes that includes, but is not limited to, intangible assets, inventory, receivables and certain minority investments as collateral for the debt. The security interest does not include any PP&E, leasehold interests and improvements with respect to such PP&E which would be reflected on our consolidated balance sheets or shares of stock and indebtedness of our subsidiaries.

Covenants under the Senior Debt Agreements

Under the Credit Agreement, we are required to comply with a maximum consolidated total leverage ratio measured on a quarterly basis. As of December 27, 2015, we are required to maintain a consolidated total leverage ratio of not more than 6.00 to 1.00. For purposes of the consolidated total leverage ratio, debt is largely defined as debt, net of cash on hand in excess of $20 million. As of December 27, 2015, we were in compliance with all financial debt covenants.

The Credit Agreement also prohibits the payment of a dividend if a payment would not be permitted under the indenture for the 9.00% Notes (discussed below). Dividends under the indenture for the 9.00% Notes are allowed if the consolidated leverage ratio (as defined in the indenture) is less than 5.25 to 1.00 and we have sufficient amounts under our restricted payments basket (as defined in the indenture).

The indenture for the 9.00% Notes and the Credit Agreement include a number of restrictive covenants that are applicable to us and our restricted subsidiaries. The covenants are subject to a number of important exceptions and qualifications set forth in those agreements. These covenants include, among other things, restrictions on our ability to incur additional debt; make investments and other restricted payments; pay dividends on capital stock or redeem or repurchase capital stock or certain of our outstanding notes or debentures prior to stated maturity; sell assets or enter into sale/leaseback transactions; create specified liens; create or permit restrictions on the ability of our restricted subsidiaries to pay dividends or make other distributions; engage in certain transactions with affiliates; and consolidate or merge with or into other companies or sell all or substantially all of the Company’s and our subsidiaries’ assets, taken as a whole.

Maturities

The following table presents the approximate annual maturities of outstanding long‑term debt as of December 27, 2015, based upon our required payments, for the next five years and thereafter:

	Payments
Year	(in thousands)
2016	$	—
2017		55,442
2018		—
2019		—
2020		—
Thereafter		881,833
Debt principal	$	937,275

60

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

6.  INCOME TAXES

Income tax provision (benefit) consisted of:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Current:
Federal	$	13,317	$	233,247	$	16,100
State		(2,027)		30,216		5,108
Deferred:
Federal		(17,642)		(29,182)		(7,262)
State		(5,445)		(3,051)		(2,287)
Income tax provision (benefit)	$	(11,797)	$	231,230	$	11,659

The effective tax rate expense (benefit) and the statutory federal income tax rate are reconciled as follows:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Statutory rate	(35.0)	%	35.0	%	35.0	%
State taxes, net of federal benefit	(2.1)		3.0		12.3
Changes in estimates	0.1		—		—
Changes in unrecognized tax benefits	0.3		—		(6.0)
Settlements	—		(0.1)		(1.5)
Other	—		0.1		3.1
Goodwill impairment	32.5		—		—
Stock compensation	0.4		0.1		(1.4)
Effective tax rate	(3.8)	%	38.1	%	41.5	%

The components of deferred tax assets and liabilities consisted of the following:

	December 27,		December 28,
(in thousands)	2015		2014
Deferred tax assets:
Compensation benefits	$	233,101	$	248,585
State taxes		3,586		6,061
State loss carryovers		2,877		2,266
Other		3,765		4,508
Total deferred tax assets		243,329		261,420
Valuation allowance		(2,877)		(2,265)
Net deferred tax assets		240,452		259,155
Deferred tax liabilities:
Depreciation and amortization		160,752		195,616
Investments in unconsolidated subsidiaries		50,434		52,711
Debt discount		8,301		9,618
Deferred gain on debt		19,653		26,318
Total deferred tax liabilities		239,140		284,263
Net deferred tax (assets) liabilities	$	(1,312)	$	25,108

The valuation allowance relates to state net operating loss and capital loss carryovers, andincreased by $0.6 million in 2015 and decreased by$1.5 million in2014.

61

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

As of December 27, 2015, we have net operating loss carryforwards in various states totaling approximately $196.5 million. The net operating losses carryforwards expire in various years between 2024 and 2035 if not used.

As of December 27, 2015, we had approximately $18.1 million of long‑term liabilities relating to uncertain tax positions consisting of approximately $15.6 million in gross unrecognized tax benefits (primarily state tax positions before the offsetting effect of federal income tax) and $2.5 million in gross accrued interest and penalties. If recognized, approximately $8.1 million of the net unrecognized tax benefits would impact the effective tax rate, with the remainder impacting other accounts, primarily deferred taxes. It is reasonably possible that a reduction of up to $1.1 million of unrecognized tax benefits and related interest may occur within the next 12 months as a result of the expiration of statutes of limitations.

We record interest on unrecognized tax benefits as a component of interest expense, while penalties are recorded as part of income tax expense.  Related to the unrecognized tax benefits noted below, we recorded interest expense (benefit), of ($0.3) million,  $0.1 million and ($0.7) million for 2015,  2014and 2013, respectively.  We also recorded penalty expense (benefit) of $0.1 million and ($0.1) million during 2015 and 2014, respectively.  During 2013, our recorded penalty expense was immaterial. Accrued interest and penalties at December 27, 2015,  December 28, 2014, and December 29, 2013, were approximately $2.5 million, $2.7 million and $2.7 million, respectively.

A reconciliation of the beginning and ending amount of unrecognized tax benefits consists of the following:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Balance at beginning of fiscal year	$	13,046	$	12,889	$	8,649
Increases based on tax positions in prior year		4,433		1		7,631
Decreases based on tax positions in prior year		—		(363)		(935)
Increases based on tax positions in current year		1,435		1,357		1,386
Settlements		—		(49)		(259)
Lapse of statute of limitations		(3,293)		(789)		(3,583)
Balance at end of fiscal year	$	15,621	$	13,046	$	12,889

As of December 27, 2015, the following tax years and related taxing jurisdictions were open:

	Open	Years Under
Taxing Jurisdiction	Tax Year	Exam
Federal	2012-2015	2013
California	2011-2015	—
Other States	2006-2015	2011-2014

7.  EMPLOYEE BENEFITS

We have a qualified defined benefit pension plan (“Pension Plan”) covering substantially all of our employees who began their employment prior to March 31, 2009. Effective March 31, 2009, the Pension Plan was frozen such that no new participants may enter the Pension Plan and no further benefits will accrue. However, years of service continue to count toward early retirement calculations and vesting of benefits previously earned.

We also have a limited number of supplemental retirement plans to provide key employees hired prior to March 31, 2009, with additional retirement benefits. These plans are funded on a pay‑as‑you‑go basis and the accrued pension obligation is largely included in other long‑term obligations. We paid $8.5 million, $8.5 million and $8.3 million in 2015, 2014 and 2013, respectively, for these plans. We also provide or subsidize certain life insurance benefits for employees.

62

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

The following tables provide reconciliations of the pension and post‑ retirement benefit plans’ benefit obligations, fair value of assets and funded status as of December 27, 2015, and December 28, 2014:

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Change in Benefit Obligation
Benefit obligation, beginning of year	$	2,051,907	$	1,849,321	$	10,602	$	12,586
Service cost		11,680		8,030		—		—
Interest cost		84,994		91,004		368		514
Plan participants’ contributions		—		—		35		267
Actuarial (gain)/loss		(101,952)		213,176		(87)		467
Gross benefits paid		(103,062)		(101,441)		(1,035)		(1,611)
Plan amendment		—		—		—		(1,621)
Administrative expenses		(12,247)		(8,183)		—		—
Benefit obligation, end of year	$	1,931,320	$	2,051,907	$	9,883	$	10,602

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Change in Plan Assets
Fair value of plan assets, beginning of year	$	1,478,686	$	1,432,695	$	—	$	—
Actual return on plan assets		(22,307)		122,133		—		—
Employer contribution		8,533		33,482		1,000		1,344
Plan participants’ contributions		—		—		35		267
Gross benefits paid		(103,062)		(101,441)		(1,035)		(1,611)
Administrative expenses		(12,247)		(8,183)		—		—
Fair value of plan assets, end of year	$	1,349,603	$	1,478,686	$	—	$	—

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Funded Status
Fair value of plan assets	$	1,349,603	$	1,478,686	$	—	$	—
Benefit obligations		(1,931,320)		(2,051,907)		(9,883)		(10,602)
Funded status and amount recognized, end of year	$	(581,717)	$	(573,221)	$	(9,883)	$	(10,602)

Amounts recognized in the consolidated balance sheets at December 27, 2015, and December 28, 2014, consists of:

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Current liability	$	(8,450)	$	(8,529)	$	(1,298)	$	(1,270)
Noncurrent liability		(573,267)		(564,692)		(8,585)		(9,332)
	$	(581,717)	$	(573,221)	$	(9,883)	$	(10,602)

Amounts recognized in accumulated other comprehensive income for the years ended December 27, 2015, and December 28, 2014, consist of:

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Net actuarial loss/(gain)	$	705,853	$	701,408	$	(8,568)	$	(9,385)
Prior service cost/(credit)		—		—		(10,690)		(12,768)
	$	705,853	$	701,408	$	(19,258)	$	(22,153)

63

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

The elements of retirement and post‑retirement costs are as follows:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Pension plans:
Service Cost	$	11,680	$	8,030	$	5,545
Interest Cost		84,994		91,004		84,596
Expected return on plan assets		(106,283)		(107,460)		(101,053)
Prior service cost amortization		—		12		14
Actuarial loss		22,194		16,009		25,557
Net pension expense		12,585		7,595		14,659
Net post-retirement benefit credit		(2,614)		(2,963)		(2,497)
Net retirement expenses	$	9,971	$	4,632	$	12,162

Our discount rate was determined by matching a portfolio of long‑term, non‑callable, high-quality bonds to the plans’ projected cash flows.

Weighted average assumptions used for valuing benefit obligations were:

	Pension Benefit				Post-retirement
	Obligations				Obligations
	2015		2014		2015		2014
Discount rate	4.71	%	4.24	%	4.21	%	3.69	%

Weighted average assumptions used in calculating expense:

	Pension Benefit Expense						Post-retirement Expense
	December 27,		December 28,		December 29,		December 27,		December 28,		December 29,
	2015		2014		2013		2015		2014		2013
Expected long-term return on plan assets	7.75	%	8.00	%	8.00	%	N/A		N/A		N/A
Discount rate	4.24	%	5.01	%	4.17	%	3.69	%	4.36	%	3.39	%

Contributions and Cash Flows

We did not have a required cash minimum contribution to the Pension Plan in 2015 and made no voluntary contributions. In 2014 and 2013, we contributed $25 million and $7.6 million, respectively, of cash to the Pension Plan.

In February 2016, we contributed certain of our real property appraised at $47.1 million to our Pension Plan and we entered into leases for the contributed properties. We expected our required pension contribution under the Employee Retirement Income Security Act to be approximately $2.0 million in 2016, and the contribution of real property will exceed our required pension contribution for 2016. The contribution and leaseback of these properties in 2016 will be treated as a financing transaction and, accordingly, we will continue to depreciate the carrying value of the properties in our financial statements. No gain or loss will be recognized on the contributions until the termination of the individual leases on those properties. At the time of our contribution, our pension obligation was reduced and a financing obligation will be recorded. The financing obligation will be reduced by a portion of the lease payments made to the Pension Plan each month. The balance of this obligation at December 27, 2015, was $32.4 million and relates to certain real properties that were contributed to the Pension Plan in 2011.

64

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

Expected benefit payments to retirees under our retirement and post‑retirement plans over the next 10 years are summarized below:

	Retirement		Post-retirement
(in thousands)	Plans (1)		Plans
2016	$	101,524	$	1,297
2017		104,592		1,198
2018		107,158		1,105
2019		112,402		1,026
2020		113,173		942
2021-2025		612,003		3,567
Total	$	1,150,852	$	9,135

⁽¹⁾ Largely to be paid from the qualified defined benefit pension plan

Pension Plan Assets

Our investment policies are designed to maximize Pension Plan returns within reasonable and prudent levels of risk, with an investment horizon of greater than 10 years so that interim investment returns and fluctuations are viewed with appropriate perspective. The policy also aims to maintain sufficient liquid assets to provide for the payment of retirement benefits and plan expenses, hence, small portions of the equity and debt investments are held in marketable mutual funds.

Our policy seeks to provide an appropriate level of diversification of assets, as reflected in its target allocations, as well as limits placed on concentrations of equities in specific sectors or industries. It uses a mix of active managers and passive index funds and a mix of separate accounts, mutual funds, common collective trusts and other investment vehicles.

Our assumed long‑term return on assets was developed using a weighted average return based upon the Pension Plan’s portfolio of assets and expected returns for each asset class, taking into account projected inflation, interest rates and market returns. The assumed return was also reviewed in light of historical and recent returns in total and by asset class.

As of December 27, 2015, and December 28, 2014, the target allocations for the Pension Plan assets were 61% equity securities, 33% debt securities and 6% real estate securities.

The table below summarizes the Pension Plan’s financial instruments that are carried at fair value on a recurring basis by the fair value hierarchy levels discussed above, as of the year ended December 27, 2015:

	2015
	Plan Assets
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents	$	844	$	—	$	—	$	844
Mutual funds		436,316		—		—		436,316
Corporate debt instruments		—		112		—		112
Common collective trusts		—		845,686		—		845,686
Real estate		—		—		50,360		50,360
Private equity funds		—		—		7,282		7,282
Total	$	437,160	$	845,798	$	57,642	$	1,340,600
Pending trades								9,003
							$	1,349,603

65

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

The table below summarizes changes in the fair value of the Pension Plan’s Level 3 investment assets held for the year ended December 27, 2015:

(in thousands)	Real Estate		Private Equity		Total
Beginning Balance, December 28, 2014	$	47,579	$	6,636	$	54,215
Purchases, issuances, sales, settlements		—		—		—
Realized gains (losses)		2,479		—		2,479
Transfer in or out of level 3		(3,936)		—		(3,936)
Unrealized gains (losses)		4,238		646		4,884
Ending Balance, December 27, 2015	$	50,360	$	7,282	$	57,642

The table below summarizes the Pension Plan’s financial instruments that are carried at fair value on a recurring basis by the fair value hierarchy levels discussed above, as of the year ended December 28, 2014:

	2014
	Plan Assets
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents	$	1,068	$	—	$	—	$	1,068
Mutual funds		485,488		—		—		485,488
Corporate debt instruments		—		106		—		106
Common collective trusts		—		937,809		—		937,809
Real estate		—		—		47,579		47,579
Private equity funds		—		—		6,636		6,636
Total	$	486,556	$	937,915	$	54,215	$	1,478,686

The table below summarizes changes in the fair value of the Pension Plan’s Level 3 investment assets held for the year ended December 28, 2014:

(in thousands)	Real Estate		Private Equity (1)		Total
Beginning Balance, December 29, 2013	$	52,265	$	7,167	$	59,432
Purchases, issuances, sales, settlements		(3,312)		—		(3,312)
Realized gains		3,973		(16,153)		(12,180)
Transfer in or out of level 3		(3,973)		(483)		(4,456)
Unrealized gains		(1,374)		16,105		14,731
Ending Balance, December 28, 2014	$	47,579	$	6,636	$	54,215

⁽¹⁾ The activity within the unrealized gains (losses) and the realized gains (losses) relates to closing out two funds within the private equity funds. There was no impact to the total asset value of the private equity funds as a result of these transactions.

Cash and cash equivalents.  The carrying value of these items approximates fair value.

Mutual funds.  These investments are publicly traded investments, which are valued using the Net Asset Value (NAV). The NAV of the mutual funds is a quoted price in an active market. The NAV is determined once a day after the closing of the exchange based upon the underlying assets in the fund, less the fund’s liabilities, expressed on a per‑share basis.

Corporate debt instruments.  The fair value of corporate debt instruments is based on yields currently available on comparable securities of issuers with similar credit ratings. When quoted prices are not available for identical or similar debt instruments, the fair value is based upon an industry valuation model, which maximizes observable inputs.

Common collective trusts.  These investments are valued based on the NAV of the underlying investments and are provided by the fund issuers. NAV for these funds represent the quoted price in a non‑market environment. There are no restrictions on participants’ ability to withdraw funds from the common collective trusts.

66

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

Real estate.  On January 13, 2011, we contributed Company‑owned real property from seven locations to our Pension Plan. The Pension Plan obtained independent appraisals of the property, and based on these appraisals, the Pension Plan recorded the contribution at fair value on January 13, 2011. The properties are leased by us for our newspaper operations. The properties are managed on behalf of the Pension Plan by an independent fiduciary, and the terms of the leases between us and the Pension Plan were negotiated with the fiduciary. The property was valued by independent appraisals conducted under the direction of the independent fiduciary. Certain properties have been sold by the Pension Plan and others may be sold by the Pension Plan in the future.

Private equity funds.  Private equity funds represent investments in limited partnerships, which invest in start‑up or other private companies. Fair value was estimated based on valuations of comparable public companies, recent sales of comparable private and public companies and discounted cash flow analysis of portfolio companies.

401(k) Plan

We have a deferred compensation plan (“401(k) plan”), which enables qualified employees to voluntarily defer compensation. The 401(k) plan includes a matching company contribution and a supplemental contribution that is tied to our performance. We suspended our matching contributions to the 401(k) plan in 2009 and as of December 27, 2015, we have not reinstated that benefit.

8.  CASH FLOW INFORMATION

Cash paid during the 2015, 2014 and 2013 for interest and income taxes were:

	Year Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Interest paid (net of amount capitalized)	$	80,514	$	121,375	$	127,257
Income taxes paid (net of refunds)		207,043		77,622		21,019

The income tax payments in 2015 were primarily related to the gain on the sale of Classified Venture, LLC (previously owned equity investment) in the fourth quarter 2014, offset by the net of tax losses on bonds repurchased in the fourth quarter of 2014.

Other non-cash investing activities from continuing operations, related to the recognition of an intangible asset during 2014, was $3.1 million.

We had $0.5 million, $1.3 million and $0.2 million of non‑cash financing activities related to purchases of PP&E on credit as of the end of 2015, 2014 and 2013, respectively.

As of December 29, 2013, other non‑cash financing activities included the release of $238.1 million for the financing obligation related to the Miami property transaction because we no longer have a continuing involvement with the Miami property that was sold. As of December 29, 2013, other non‑cash investing activities included the release of $227.7 million from PP&E, which also relates to the conclusion of the Miami property transaction.

67

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

9.  COMMITMENTS AND CONTINGENCIES

We have certain other obligations for various contractual agreements that secure future rights to goods and services to be used in the normal course of operations. These include purchase commitments for printing outsource agreements, planned capital expenditures, lease commitments and self‑ insurance obligations.

The following table summarizes our minimum annual contractual obligations as of December 27, 2015:

	Payments Due By Period
(in thousands)	2016		2017		2018		2019		2020		Thereafter		Total
Purchase obligations (1)	$	19,364	$	10,035	$	6,669	$	5,829	$	5,031	$	23,581	$	70,509
Operating leases (2)
Lease obligations		11,467		10,146		8,819		7,122		5,219		24,735		67,508
Sublease income		(3,336)		(2,342)		(1,441)		(1,028)		(611)		(1,748)		(10,506)
Net lease obligation		8,131		7,804		7,378		6,094		4,608		22,987		57,002
Workers’ compensation obligations (3)		3,599		2,425		1,822		1,356		1,045		6,361		16,608
Total (4)	$	31,094	$	20,264	$	15,869	$	13,279	$	10,684	$	52,929	$	144,119

(1) Represents our purchase obligations primarily related to printing outsource agreements and capital expenditures for property, plant and equipment expiring at various dates through 2028.

(2) Represents minimum rental commitments under operating leases with non‑cancelable terms in excess of one year and sublease income from leased space. We rent certain facilities and equipment under operating leases expiring at various dates through 2028. Total rental expense, included in other operating expenses, from continuing operations amounted to $11.6 million, $12.5 million and $11.2 million in 2015, 2014 and 2013, respectively. Most of the leases provide that we pay taxes, maintenance, insurance and certain other operating expenses applicable to the leased premises in addition to the minimum monthly payments. Some of the operating leases have built in escalation clauses. We sublease office space to other companies under noncancellable agreements that expire at various dates through 2024. Sublease income from operating leases totaled $4.6million, $2.2 million and $3.9 million in 2015, 2014 and 2013, respectively.

(3) Represents the expected insurance payments of undiscounted ultimate losses, net of estimated insurance recoveries of approximately $3.2 million, and wasbased on our historical payment patterns. We retain the risk for workers’ compensation resulting from uninsured deductibles per accident or occurrence that are subject to annual aggregate limits. Losses up to the deductible amounts are accrued based upon known claims incurred and an estimate of claims incurred but not reported. For the year ended December 27, 2015, we compiled our historical data pertaining to the self‑insurance experiences and actuarially developed the ultimate loss associated with our self‑insurance programs for workers’ compensation liability. We believe that the actuarial valuation provides the best estimate of the ultimate losses to be expected under these programs. The undiscounted ultimate losses of all our self‑insurance reserves related to our workers’ compensation liabilities, net of insurance recoveries at December 27, 2015, and December 28, 2014, were $16.6 million and $18.0 million, respectively. We discount the net amount above to present value using an approximate risk‑free rate over the average life of our insurance claims. For the years ended December 27, 2015, and December 28, 2014, the discount rate used was 1.8% and 2.0%, respectively. The present value of all self‑insurance reserves, net of estimated insurance recoveries, for our workers’ compensation liability recorded at December 27, 2015, and December 28, 2014, was $15.3 million and $17.5 million, respectively.

Legal Proceedings and other contingent claims

In December 2008, carriers of The Fresno Bee filed a purported class action lawsuit against us and The Fresno Bee in the Superior Court of the State of California in Fresno County captioned Becerra v. The McClatchy Company (“Fresno case”) alleging that the carriers were misclassified as independent contractors and seeking mileage reimbursement. In February 2009, a substantially similar lawsuit, Sawin v. The McClatchy Company, involving similar allegations was filed by carriers of The Sacramento Bee (“Sacramento case”) in the Superior Court of the State of California in Sacramento County. Both courts have certified the class in these cases.  The class consists of roughly 5,000 carriers in the Sacramento case and 3,500

68

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

carriers in the Fresno case. The plaintiffs in both cases are seeking unspecified restitution for mileage reimbursement. With respect to the Sacramento case, in September 2013, all wage and hour claims were dismissed and the only remaining claim is an equitable claim for mileage reimbursement under the California Civil Code.  In the Fresno case, in March 2014, all wage and hour claims were dismissed and the only remaining claim is an equitable claim for mileage reimbursement under the California Civil Code.

The court in the Sacramento case has trifurcated the trial into three separate phases: the first phase addressed independent contractor status, the second phase will address liability, if any, and the third phase will address restitution, if any. On September 22, 2014, the court in the Sacramento case issued a tentative decision following the first phase, finding that the carriers that contracted directly with The Sacramento Bee during the period from February 2005 to July 2009 were misclassified as independent contractors. We objected to the tentative decision but the court ultimately adopted it as final. The court has not yet established a date for the second and third phases of trial concerning whether The Sacramento Bee is liable to the carriers in the class for mileage reimbursement or owes any restitution. 

The court in the Fresno case has bifurcated the trial into two separate phases: the first phase addressed independent contractor status and liability for mileage reimbursement and the second phase will address restitution, if any. The first phase of the Fresno case began in the fourth quarter of 2014 and concluded in late March 2015. The parties are awaiting a ruling on the first phase.

We are defending these actions vigorously and expect that we will ultimately prevail. As a result, we have not established a reserve in connection with the cases. While we believe that a material impact on our consolidated financial position, results of operations or cash flows from these claims is unlikely, given the inherent uncertainty of litigation, a possibility exists that future adverse rulings or unfavorable developments could result in future charges that could have a material impact. We have and will continue to periodically reexamine our estimates of probable liabilities and any associated expenses and make appropriate adjustments to such estimates based on experience and developments in litigation.

Other than the cases described above, we are subject to a variety of legal proceedings (including libel, employment, wage and hour, independent contractor and other legal actions) and governmental proceedings (including environmental matters) that arise from time to time in the ordinary course of our business. We are unable to estimate the amount or range of reasonably possible losses for these matters. However, we currently believe, after reviewing such actions with counsel, that the expected outcome of pending actions will not have a material effect on our consolidated financial statements. No material amounts for any losses from litigation that may ultimately occur have been recorded in the consolidated financial statements as we believe that any such losses are not probable.

We have certain indemnification obligations related to the sale of assets including but not limited to insurance claims and multi‑employer pension plans of disposed newspaper operations. We believe the remaining obligations related to disposed assets will not be material to our financial position, results of operations or cash flows.

As of December 27, 2015, we had $33.0 million of standby letters of credit secured under the LC Agreement (see Note 5 for further discussion).

10.  COMMON STOCK AND STOCK PLANS

Common Stock

We have two classes of stock; Class A and Class B Common Stock. Both classes of stock participate equally in dividends. Holders of Class B are entitled to one vote per share and to elect as a class 75% of the Board of Directors, rounded down to the nearest whole number. Holders of Class A Common Stock are entitled to one-tenth of a vote per share and to elect as a class 25% of the Board of Directors, rounded up to the nearest whole number.

Class B Common Stock is convertible at the option of the holder into Class A Common Stock on a share‑for‑share basis. During 2015, 154,000 Class B Common Shares were converted to Class A Common Shares at the request of a holder.

The holders of shares of Class B Common Stock are parties to an agreement, the intent of which is to preserve control of the Company by the McClatchy family. Under the terms of the agreement, the Class B shareholders have agreed to restrict

69

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

the transfer of any shares of Class B Common Stock to one or more “Permitted Transferees,” subject to certain exceptions. A “Permitted Transferee” is any of our current holders of shares of Class B Common Stock; any lineal descendant of Charles K. McClatchy (1858 to 1936); or a trust for the exclusive benefit of, or in which all of the remainder beneficial interests are owned by, one or more lineal descendants of Charles K. McClatchy.

Generally, Class B shares can be converted into shares of Class A Common Stock and then transferred freely (unless, following conversion, the outstanding shares of Class B Common Stock would constitute less than 25% of the total number of all our outstanding shares of common stock). In the event that a Class B shareholder attempts to transfer any shares of Class B Common Stock in violation of the agreement, or upon the happening of certain other events enumerated in the agreement as “Option Events,” each of the remaining Class B shareholders has an option to purchase a percentage of the total number of shares of Class B Common Stock proposed to be transferred equal to such remaining Class B shareholder’s ownership percentage of the total number of outstanding shares of Class B Common Stock. If all the shares proposed to be transferred are not purchased by the remaining Class B shareholders, we have the option of purchasing the remaining shares. The agreement can be terminated by the vote of the holders of 80% of the outstanding shares of Class B Common Stock who are subject to the agreement. The agreement will terminate on September 17, 2047, unless terminated earlier in accordance with its terms.

In April 2015, our Board of Directors authorized a new share repurchase program for the repurchase of up to $7.0 million of our Class A Common Stock through December 31, 2016. This program was further amended in August 2015 to authorize a total of up to $15.0 million to repurchase shares. The shares are to be repurchased from time to time depending on prevailing market prices, availability, and market conditions, among other factors. As of December 27, 2015, we have repurchased approximately 6.1 million shares at a weighted average price of $1.28 per share, or $7.8 million of the total buyback approved.

Stock Plans

During 2015, we had two stock‑based compensation plans, which are described below.

We have a stock incentive plan (the “2004 Plan”) that reserved 9,000,000 Class A Common shares for issuance to key employees and outside directors. The options vested in installments over four years, and once vested are exercisable up to 10 years from the date of grant. In addition, the 2004 Plan permitted the following type of incentive awards in addition to common stock, stock options and stock appreciation rights (“SARs”): restricted stock, unrestricted stock, stock units and dividend equivalent rights. The 2004 Plan was frozen in May 2012.

In May 2012 the shareholders approved The McClatchy Company 2012 Omnibus Incentive Plan (“2012 Plan”) to replace the 2004 Plan, for all future awards. The 2012 Plan provided that the Class A Common Stock available for issuance equal to 5,000,000 shares plus the number of shares available for future awards under the 2004 Plan as of the date of May 16, 2012 (the shareholder meeting date) plus the number of shares subject to awards outstanding under the 2004 Plan as of May 16, 2012, which terminate by expiration, forfeiture, cancellation or otherwise without the issuance of such shares. The 2012 Plan generally provides for granting of stock options or SARs only at an exercise price at least equal to fair market value on the grant date; a 10-year maximum term for stock options and SARs; no repricing of stock options or SARs without prior shareholder approval; and no reload or “evergreen” share replenishment features.

Stock Plans Activity

In both 2015 and 2014, we granted 15,000 shares of Class A Common Stock to each non‑employee director, resulting in the issuance of 150,000 shares from the 2012 Plan in each year. In 2013, we granted 15,000 shares of Class A Common Stock to each non-employee director, resulting in the issuance of 165,000 shares from the 2012 Plan.

We granted restricted stock units (“RSUs”) at fair market value on the date of grant to certain key employees from the 2012 Plan as summarized below. The RSUs generally vest three years after grant date but terms of each grant are at the discretion of the compensation committee of the board of directors.

70

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

The following table summarizes the RSUs stock activity:

		Weighted
		Average Grant
		Date Fair
	RSUs	Value
Nonvested — December 30, 2012	1,102,000	$	2.98
Granted	483,150	$	2.46
Vested	(320,000)	$	4.08
Forfeited	(33,500)	$	2.48
Nonvested — December 29, 2013	1,231,650	$	2.50
Granted	856,950	$	4.61
Vested	(717,150)	$	2.92
Forfeited	(41,900)	$	2.93
Nonvested — December 28, 2014	1,329,550	$	3.62
Granted	1,365,300	$	2.28
Vested	(970,000)	$	2.85
Forfeited	(186,050)	$	3.08
Nonvested — December 27, 2015	1,538,800	$	2.98

As of December 27, 2015, the total fair value of the RSUs that vested during the period was $1.6 million. As of December 27, 2015, there were $3.0 million of unrecognized compensation costs for nonvested RSUs, which are expected to be recognized over 1.8 years.

When SARs are granted they are granted at fair market value on the date of grant to certain key employees from the 2012 Plan. The SARs generally vest four years after grant date but terms of each grant is at the discretion of the compensation committee of the board of directors.

Outstanding options and SARs are summarized as follows:

		Weighted		Aggregate
		Average		Intrinsic Value
	SARs	Exercise Price		(in thousands)
Outstanding December 30, 2012	6,194,500	$	11.45	$	1,846
Granted	775,000	$	2.46
Exercised	(545,750)	$	1.72	$	847
Forfeited	(58,500)	$	3.30
Expired	(254,750)	$	48.97
Outstanding December 29, 2013	6,110,500	$	9.69	$	2,384
Exercised	(1,678,250)	$	2.86	$	3,138
Forfeited	(67,250)	$	3.38
Expired	(516,250)	$	35.74
Outstanding December 28, 2014	3,848,750	$	9.28	$	1,542
Forfeited	(68,750)	$	2.61
Expired	(578,750)	$	20.76
Outstanding December 27, 2015	3,201,250	$	7.35	$	—
Vested and Expected to Vest December 27, 2015	3,179,366	$	8.09	$	—
Options exercisable:
December 29, 2013	3,983,875			$	1,306
December 28, 2014	2,719,750			$	716
December 27, 2015	2,774,125			$	—

As of December 27, 2015, there were $0.3 million of unrecognized compensation costs related to options and SARs granted under our plans. The cost is expected to be recognized over a weighted average period of 1.1 years.

71

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

The following tables summarize information about stock options and SARs outstanding in the stock plans at December 27, 2015:

		Average
		Remaining	Weighted			Weighted
Range of Exercise	Options/SARs	Contractual	Average		Options/SARs	Average
Prices	Outstanding	Life	Exercise Price		Exercisable	Exercise Price
$1.70 – $9.07	2,426,250	4.70	$	3.06	1,999,125	$	3.17
$9.73 – $35.94	574,000	1.91	$	13.17	574,000	$	13.17
$40.95 – $73.36	201,000	0.92	$	42.48	201,000	$	42.48
Total	3,201,250	3.96	$	7.35	2,774,125	$	8.09

The weighted average remaining contractual life of options exercisable at December 27, 2015, was 3.5 years. The weighted average remaining contractual life of options vested and expected to vest at December 27, 2015, was 3.5 years.

The fair value of the stock options and SARs granted in 2013 were estimated on the date of grant using a Black‑Scholes option valuation model that used the assumptions noted in the following table. The expected life of the options represents the period of time that options granted were expected to be outstanding using the historical exercise behavior of employees. The expected dividend yield was based on historical dividends declared per year, giving consideration for any anticipated change and the estimated stock price over the expected life of the options based on historical experience. Expected volatility was based on historical volatility for a period equal to the stock option’s expected life for shares granted. The risk‑free rate for periods within the contractual life of the option was based on the U.S. Treasury yield curve in effect at the time of grant. We did not grant any SARs in 2015 or 2014.

	2013
Expected life in years		4.51
Dividend yield		NIL
Volatility		1.08
Risk-free interest rate		0.76	%
Weighted average exercise price of options/SARs granted	$	2.46
Weighted average fair value of options/SARs granted	$	1.85

Stock‑Based Compensation

Total stock‑based compensation expense consisted of the following:

	Years Ended
	December 27,		December 29,		December 29,
(in thousands)	2015		2014		2013
Stock-based compensation expense	$	3,178	$	3,479	$	3,481

72

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

11.  QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

Our business is somewhat seasonal with peak revenues and profits generally occurring in the second and fourth quarters of each year as a result of increased advertising activity during the holiday seasons. The first and third quarters are historically the slowest quarters for revenues and profits. Our quarterly results are summarized as follows:

	Quarters Ended
(in thousands, except per share	March 29,		June 28,		September 27,		December 27,
amounts)	2015		2015		2015		2015
Net revenues	$	257,178	$	262,360	$	251,211	$	285,825
Operating income (loss)	$	(1,158)	$	(288,966)	$	8,389	$	36,396
Income (loss) from continuing operations	$	(11,346)	$	(296,497)	$	(1,149)	$	8,830
Income (loss) from discontinued operations		—		—		—		—
Net income (loss)	$	(11,346)	$	(296,497)	$	(1,149)	$	8,830
Income (loss) from continuing operations per share - diluted	$	(0.13)	$	(3.39)	$	(0.01)	$	0.10
Income (loss) from discontinued operations per share - diluted		—		—		—		—
Net income (loss) per share - diluted	$	(0.13)	$	(3.39)	$	(0.01)	$	0.10

	Quarters Ended
(in thousands, except per share	March 30,		June 29,		September 28,		December 28,
amounts)	2014		2014		2014		2014
Net revenues	$	276,171	$	287,391	$	272,899	$	310,091
Operating income	$	(4,698)	$	27,307	$	18,550	$	41,164
Income (loss) from continuing operations	$	(16,062)	$	91,648	$	(2,619)	$	303,010
Income from discontinued operations		220		(1,699)		(141)		(368)
Net income (loss)	$	(15,842)	$	89,949	$	(2,760)	$	302,642
Income (loss) from continuing operations per share - diluted	$	(0.18)	$	1.03	$	(0.03)	$	3.45
Income from discontinued operations per share - diluted		—		(0.01)		—		(0.01)
Net income (loss) per share - diluted	$	(0.18)	$	1.02	$	(0.03)	$	3.44

The following are significant activities in 2015:

· During the quarter ended June 28, 2015, we recognized a goodwill impairment charge of $290.9 million and masthead impairment charges of $9.5 million as described in Note 1 and Note 4.

· During the quarter ended December 27, 2015, we recognized masthead impairment charges of $4.4 million as described in Note 1 and Note 4.

The following are significant activities in 2014:

· During the quarter ended June 29, 2014, we recognized gains related to our sale of MCT for $1.7 million before taxes and from our portion of the sale of Apartments.com by Classified Ventures for $144.2 million before taxes as described in Note 3.

During the quarter ended December 28, 2014, we recognized a gain on the sale of our ownership interest in Classified Ventures for $559.3 million before taxes as described in Note 3, write-downs of certain equity investments for $7.8 million as described in Note 3, masthead impairment charges of $5.2 million as described in Note 1, and loss on extinguishment of debt of $72.8 million as described in Note 5.

73

THE MCCLATCHY COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 27, 2015,  DECEMBER 28, 2014, AND DECEMBER 29, 2013

12. CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN

On February 11, 2016,  we contributed company-owned real property from sixlocations to ourPension Plan. The Pension Plan obtained independent appraisals of the property, and based on these appraisals, recorded the contribution (the fair value of the property) at $47.1 million on February 11, 2016.  

We have entered into leases for the contributed properties for 11 years at an aggregate annual rent of approximately $3.5 million and we expect to continue to use the properties in our newspaper operations at the sixlocations. The properties will be managed on behalf of the pension plan by an independent fiduciary, and the terms of the leases were negotiated with the fiduciary.

The contribution and leaseback of the properties are treated as a financing transaction and accordingly, we will continue to depreciate the carrying value of the properties in our financial statements and no gain or loss is recognized. The $47.1 million will be recorded in financing obligations and will be reduced by a portion of lease payments made to the pension plan. The transaction will be recorded in the quarter ended March 27, 2016 and therefore the funded status of our qualified pension plan disclosed in Note 7 and elsewhere in these financial statements does not reflect this transaction.

74

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Not applicable.

ITEM 9A.  CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures.

Our management evaluated, with the participation of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a ‑ 15(e) or 15d ‑ 15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Annual Report on Form 10‑K. Based on this evaluation, our management, including the CEO and CFO, concluded that our disclosure controls and procedures were effective at that time to ensure that information we are required to disclose in reports that we file or submit under the Securities Exchange Act of 1934 is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure and that such information is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission Rules and Forms.

Changes in internal control over financial reporting.

There was no change in our internal control over financial reporting that occurred during the fourth fiscal quarter of fiscal 2015 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

MANAGEMENT REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in the Securities Exchange Act of 1934, as amended Rules 13a‑15(f). The Company’s internal control system over financial reporting is designed to provide reasonable assurance regarding the preparation and fair presentation of the Company’s financial statements presented in accordance with generally accepted accounting principles in the United States of America.

An internal control system over financial reporting has inherent limitations and may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Management of the Company assessed the effectiveness of the Company’s internal control over financial reporting as of December 27, 2015. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in the Internal Control – Integrated Framework (2013 framework). Based on management’s assessment and those criteria, management believes that the Company’s internal control over financial reporting was effective as of December 27, 2015.

The McClatchy Company’s independent registered public accounting firm has issued an attestation report on the Company’s internal control over financial reporting. This report appears in Item 8 – “Financial Statements and Supplementary Data.”

ITEM 9B.  OTHER INFORMATION

Not Applicable.

75

PART III

ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Incorporated herein by reference from the proxy statement for the annual meeting of our stockholders to be filed pursuant to Regulation 14A within 120 days after our fiscal year‑end of December 27, 2015.

ITEM 11.  EXECUTIVE COMPENSATION

Incorporated herein by reference from the proxy statement for the annual meeting of our stockholders to be filed pursuant to Regulation 14A within 120 days after our fiscal year‑end of December 27, 2015.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Incorporated herein by reference from the proxy statement for the annual meeting of our stockholders to be filed pursuant to Regulation 14A within 120 days after our fiscal year‑end of December 27, 2015.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Incorporated herein by reference from the proxy statement for the annual meeting of our stockholders to be filed pursuant to Regulation 14A within 120 days after our fiscal year‑end of December 27, 2015.

ITEM 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES

Incorporated herein by reference from the proxy statement for the annual meeting of our stockholders to be filed pursuant to Regulation 14A within 120 days after our fiscal year‑end of December 27, 2015.

76

PART IV

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)&(c)	Financial Statements and Financial Statement Schedules filed as a part of this Report are listed in Item 8 – “Financial Statements and Supplementary Data”.
(b)	Exhibits listed on the accompanying Index of Exhibits are filed or furnished as part of this report, following the signature pages.

77

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

THE MCCLATCHY COMPANY

(Registrant)

	President, Chief Executive Officer and Director
	/s/ Patrick J. Talamantes Patrick J. Talamantes, President, Chief Executive Officer and Director
March 7, 2016

78

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Patrick J. Talamantes Patrick J. Talamantes	President, Chief Executive Officer And Director (Principal Executive Officer)	March 7, 2016
/s/ R. Elaine Lintecum R. Elaine Lintecum	Vice President‑Finance, Chief Financial Officer and Treasurer (Principal Financial Officer)	March 7, 2016
/s/ Stephanie Shepherd Stephanie Shepherd	Controller (Principal Accounting Officer)	March 7, 2016
/s/ Kevin S. McClatchy Kevin S. McClatchy	Chairman of the Board	March 3, 2016
/s/ Elizabeth Ballantine Elizabeth Ballantine	Director	March 3, 2016
/s/ Leroy Barnes, Jr. Leroy Barnes, Jr.	Director	March 3, 2016
/s/ Molly Maloney Evangelisti Molly Maloney Evangelisti	Director	March 3, 2016
/s/ Kathleen Foley Feldstein Kathleen Foley Feldstein	Director	March 3, 2016
/s/ Craig I. Forman Craig I. Forman	Director	March 3, 2016
/s/ Brown McClatchy Maloney Brown McClatchy Maloney	Director	March 3, 2016
/s/ William B. McClatchy William B. McClatchy	Director	March 3, 2016
/s/ Clyde W. Ostler Clyde W. Ostler	Director	March 3, 2016
/s/ Frederick R. Ruiz Frederick R. Ruiz	Director	March 3, 2016

79

INDEX OF EXHIBITS

(Item 15 (a) 3.)

		Incorporated by reference herein
Exhibit Number	Description	Form	Exhibit	File Date
3.1	The Company’s Restated Certificate of Incorporation, dated June 26, 2006	10‑Q	3.1	June 25, 2006
3.2	The Company’s Bylaws as amended and restated effective March 20, 2012	8‑K	3.1	March 22, 2012
10.1	Amended and Restated Guaranty dated as of September 26, 2008, executed by certain subsidiaries of The McClatchy Company in favor of the lenders under the Credit Agreement	8‑K	10.3	September 30, 2008
10.2	Security Agreement dated as of September 26, 2008, executed by The McClatchy Company and certain of its subsidiaries in favor of Bank of America, N.A., as Administrative Agent	8‑K	10.2	September 30, 2008
10.3	Commitment Reduction and Amendment and Restatement Agreement, dated as of June 22, 2012, among the Company and Bank of America, N.S., as Administrative Agent	8‑K	10.1	June 25, 2012
10.4	Third Amended and Restated Credit Agreement dated December 18, 2012, among the Company, the lenders from time to time party thereto, and Bank of America, N.A., Administrative Agent, Swing Line Lender and L/C Issuer	8‑K	10.1	December 20, 2012
10.5	Amendment No. 1 to the Third Amended and Restated Credit Agreement and Amendment No. 1 to the Security Agreement, dated October 21, 2014, between the Company and Bank of America, N.A., as Administrative Agent.	8‑K	10.1	October 23, 2014
10.6	Collateralized Issuance and Reimbursement Agreement, dated October 21, 2014, between the Company and Bank of America, N.A	8-K	10.2	October 23, 2014
10.7	Indenture, dated as of November 4, 1997, between Knight‑ Ridder, Inc. and The Chase Manhattan Bank of New York, as Trustee, [Knight‑Ridder’s Registration Statement on Form S‑3]	S‑3	4.1	October 10, 1997
10.8	First Supplemental Indenture, dated as of June 1, 2001, Knight‑ Ridder, Inc.; The Chase Manhattan Bank of New York, as original Trustee; and The Bank of New York, as series Trustee [Knight‑Ridder, Inc. Report on Form 8‑K]	8‑K	4	June 1, 2001
10.9	Second Supplemental Indenture, dated as of November 1, 2004, among Knight‑Ridder, Inc., JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as trustee, and The Bank of New York Trust Company, N.A., as series trustee for the Notes [Knight‑Ridder, Inc. Report on Form 8‑K]	8‑K	4.1	November 4, 2004

80

			Incorporated by reference herein
Exhibit Number		Description	Form	Exhibit	File Date
10.10		Third Supplemental Indenture, dated as of August 16, 2005, among Knight‑Ridder, Inc., JPMorgan Chase Bank, N.A. (formerly known as The Chase Manhattan Bank), as trustee, and The Bank of New York Trust Company, N.A., as series trustee for the Notes [Knight‑Ridder, Inc. Report on Form 8‑K]	8‑K	4.1	August 22, 2005
10.11		Fourth Supplemental Indenture dated June 27, 2006, between the Company and Knight‑Ridder Inc.	10‑Q	10.4	June 25, 2006
10.12		Indenture dated December 18, 2012, among The McClatchy Company, the subsidiary guarantors party thereto and the Bank of New York Mellon Trust Company, N.A. relating to the 9.00% Senior Secured Notes due 2022	8‑K	4.2	December 20, 2012
10.13		Registration Rights Agreement dated December 18, 2012, between The McClatchy Company and J.P. Morgan Securities LLC, relating to the 9.00% Senior Secured Notes due 2022	8‑K	4.3	December 20, 2012
10.14		Purchase and Sale Agreement Between the Company, a Delaware corporation, and Richwood, Inc., a Florida corporation and Bayfront 2011 Property, LLC dated May 26, 2011	10‑Q	10.42	June 26, 2011
10.15	*	The McClatchy Company Management Objective Plan Description.	10‑K	10.4	December 30, 2000
10.16	*	Amended and Restated Supplemental Executive Retirement Plan	10‑K	10.4	December 29, 2002
10.17	*	Amendment Number 1 to The McClatchy Company Supplemental Executive Retirement Plan	8‑K	10.1	February 10, 2009
10.18	*	Amended and Restated McClatchy Company Benefit Restoration Plan	8‑K	10.1	July 29, 2011
10.19	*	Amended and Restated McClatchy Company Bonus Recognition Plan	8‑K	10.2	July 29, 2011
10.20	*	The Company’s 2004 Stock Incentive Plan, as amended and restated	10‑Q	10.25	June 29, 2008
10.21	*	Form of 2004 Stock Incentive Plan Nonqualified Stock Option Agreement	8‑K	99.1	December 16, 2004
10.22	*	Form of Restricted Stock Agreement related to the Company’s 2004 Stock Incentive Plan	8‑K	99.1	January 28, 2005
10.23	*	Form of Restricted Stock Unit Agreement related to the Company’s 2004 Stock Incentive Plan	8‑K	10.1	December 18, 2009
10.24	*	The McClatchy Company 2012 Omnibus Incentive Plan	DEF 14A	Appendix A	April 2, 2012
10.25	*	Form of Restricted Stock Unit Agreement under The McClatchy Company 2012 Omnibus Incentive Plan	8‑K	10.3	May 18, 2012
10.26	*	Form of Stock Appreciation Right Agreement under The McClatchy Company 2012 Omnibus Incentive Plan	8‑K	10.2	May 18, 2012

81

			Incorporated by reference herein
Exhibit Number		Description	Form	Exhibit	File Date
10.27	*	Employment Agreement between the Company and Patrick Talamantes dated February 6, 2015	8‑K	10.1	February 6, 2015
10.28	*	2012 Senior Executive Retention Bonus Plan	8‑K	10.4	May 18, 2012
10.29	*	Form of Indemnification Agreement between the Company and each of its officers and directors	8‑K	99.1	May 23, 2005
10.30	*	The McClatchy Company Director Deferral Program under The McClatchy Company 2012 Omnibus Incentive Plan
10.31	*	Form of Stock Award Deferral Election Agreement under The McClatchy Company 2012 Omnibus Incentive Plan
10.32		Unit Purchase Agreement by and among Classified Ventures, LLC, Gannett Co., Inc., Tribune Media Company, The McClatchy Company, Graham Holdings Company, and A. H. Belo, and certain of their respective wholly-owned subsidiaries, dated August 5, 2014	8‑K	10.1	August 6, 2014
10.33		Consulting Agreement dated July 1, 2015 by and between Robert J. Weil and the McClatchy Company	8-K	10.1	July 2, 2015
12		Computation of Earnings to Fixed Charges
21		Subsidiaries of the Company
23		Consent of Deloitte & Touche LLP
23.1		Consent of Ernst & Young LLP
23.2		Consent of PricewaterhouseCoopers LLP
31.1		Certification of the Chief Executive Officer of The McClatchy Company pursuant to Rule 13a‑14(a) under the Exchange Act
31.2		Certification of the Chief Financial Officer of The McClatchy Company pursuant to Rule 13a‑14(a) under the Exchange Act
32.1	**	Certification of the Chief Executive Officer of The McClatchy Company pursuant to 18 U.S.C. Section 1350
32.2	**	Certification of the Chief Financial Officer of The McClatchy Company pursuant to 18 U.S.C. Section 1350
99.1		Consolidated balance sheet of CareerBuilder, LLC as of December 31, 2015 and December 31, 2014 and the related consolidated statements of operations, comprehensive income, equity, and cash flows for each of the three years ended December 31, 2015 and Report of Independent Auditors as it relates to 2013.
99.2		Consolidated balance sheets of Classified Ventures, LLC as of October 1, 2014 and December 31, 2013 and the related consolidated statements of operations, changes in members’ equity, and cash flows for the period ended October 1, 2014 and the year ended December 31, 2013 and Independent Auditor’s Report as it relates to 2013.

82

		Incorporated by reference herein
Exhibit Number	Description	Form	Exhibit	File Date
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

*Compensation plans or arrangements for the Company’s executive officers and directors

**Furnished, not filed

83

EX-10.30

Exhibit 10.30

THE McCLATCHY COMPANY

DIRECTOR DEFERRAL PROGRAM

non-employee director Deferred Stock Unit AGREEMENT

THIS AGREEMENT, entered into as of September   , 201[6] (the “Grant Date”), and between THE McCLATCHY COMPANY, a Delaware corporation (the “Company”) and [Director]  (the “Director”),

W I T N E S S E T H:

WHEREAS, the Board of Directors of the Company has established THE DIRECTOR DEFERRAL PROGRAM (the “Program”) under the THE McCLATCHY COMPANY 2012 OMNIBUS INCENTIVE PLAN (the “Plan”) in order to permit nonemployee members of the Board of Directors (the “Board”) to elect to defer the receipt of shares of the Company’s Class A Common Stock (the “Stock”) granted to them under the Plan by virtue of their Service as a nonemployee member of the Board of Directors; and

WHEREAS, the Director is a non-employee member of the Board, who prior to the close of calendar year [2015] filed an irrevocable election with the Company under the Program to receive the Deferred Stock Units covering all of the Stock that otherwise would be granted to the Director in calendar year [2016].

NOW, THEREFORE, it is agreed as follows:

SECTION 1.GRANT OF DEFERRED STOCK UNITS.

(a)Grant.  The Company hereby grants to the Director an award of _____ DeferredStock Units, each such unit representing a share of Stock, subject to the terms and conditions set forth in this Agreement, the Program and the Plan.

(b)Director Deferral Program.  The Deferred Stock Units under this Agreement are granted pursuant to the Program and the Plan, copies of which the Director acknowledges having received and read.  The provisions of the Program and the Plan are incorporated into this Agreement by reference and any capitalized terms not defined herein shall have the meaning prescribed in the Plan or the Program, as applicable.

SECTION 2.CONSIDERATION.  

The grant of the Deferred Stock Units is made in consideration of the services to be rendered by the Director to the Company.

SECTION 3.VESTING.

The Deferred Stock Units shall be 100% vested as of the Grant Date.

SECTION 4.RESTRICTIONS.

The Deferred Stock Units may not be sold, assigned, transferred, pledged, hypothecated, or otherwise encumbered, whether by operation of law or otherwise, nor may the Deferred Stock Units be made subject to execution, attachment, or similar process.  Any attempt by the Director to sell, assign, transfer, pledge, hypothecate, or otherwise encumber the Deferred Stock Units or any rights relating thereto shall be wholly ineffective and, if any such attempt is made, the Deferred Stock Units will be forfeited by the Director and all of the Director's rights to such Deferred Stock Units shall immediately terminate without any payment or consideration by the Company.

SECTION 5.RIGHTS AS A STOCKHOLDER; DIVIDEND EQUIVALENTS.

(a)The Director has no rights as a stockholder with respect to the Deferred Stock Units unless and until the Stock relating to the Deferred Stock Units has been delivered to the Director.

(b)Upon the Company’s payment of a cash dividend on outstanding Stock, the Director shall be entitled to receive a dividend equivalent for each Deferred Stock Unit that he holds as of the record date for such dividend equal to the per-share dividend paid on the Stock.  Such dividend equivalent shall be paid in cash at the same time paid to other stockholders of the Company as of the record date for such dividend [and shall not be subject to the Deferral Election].

SECTION 6.DELIVERY.

Delivery of the shares of Stock represented by the Deferred Stock Units will be made in accordance with the Director’s deferral election under the Program (the “Deferral Election”), which is attached to this Agreement as Exhibit A.

SECTION 7.EVIDENCE OF ISSUANCE.

The issuance of the shares of Stock with respect to the Deferred Stock Units will be evidenced in such a manner as the Company, in its discretion, deems appropriate, including, without limitation, book-entry, registration, or issuance of one or more share certificates.

SECTION 8.CLAWBACK.

The Deferred Stock Units are subject to mandatory repayment by the Director to the Company to the extent the Director becomes subject to applicable law that requires the repayment by the Director to the Company of compensation paid by the Company to the Director, in the event that the Director fails to comply with, or violates, the terms or requirements of such policy or applicable law.

SECTION 9.CODE SECTION 409A.

2

The grant of Deferred Stock Units under this Agreement is intended to comply with Section 409A to the extent subject thereto, and, accordingly, to the maximum extent permitted, this Agreement will be interpreted and administered to be in compliance with Section 409A.  Notwithstanding anything to the contrary in the Plan or this Agreement, neither the Company, its Affiliates, the Board, nor the Committee will have any obligation to take any action to prevent the assessment of any excise tax or penalty on the Director under Section 409A, and neither the Company, its Affiliates, the Board, nor the Committee will have any liability to the Director for such tax or penalty. For purposes of this grant, a termination of employment or other service relationship only occurs upon an event that would be a Separation from Service within the meaning of Section 409A.

SECTION 10.DISCLAIMER OF RIGHTS.

The grant of Deferred Stock Units under this Agreement will in no way be interpreted to require the Company to transfer any amounts to a third party trustee or otherwise hold any amounts in trust or escrow for payment to the Director.  The Director will have no rights under this Agreement or the Plan other than those of a general unsecured creditor of the Company.  Deferred Stock Units represent unfunded and unsecured obligations of the Company, subject to the terms and conditions of the Plan and this Agreement.

SECTION 11.MISCELLANEOUS PROVISIONS.

(a)No Right to Service on the Board.  Neither the Program nor this Agreement shall confer upon the Director any right to be retained as a Director of the Company or in any other capacity. Further, nothing in the Program, the Plan or this Agreement shall be construed to limit the discretion of the Company to remove the Director from Service.

(b)Notice.  Any notice required by the terms of this Agreement shall be given in writing and shall be deemed effective upon personal delivery or upon deposit with the United States Postal Service, by registered or certified mail with postage and fees prepaid and addressed to the party entitled to such notice at the address shown below such party's signature on this Agreement, or at such other address as such party may designate by 10 days' advance written notice to the other party to this Agreement.

(c)Consent to Electronic Delivery.  The Company may choose to deliver certain statutory materials relating to the Program in electronic form.  By accepting this grant, the Director agrees that the Company may deliver the Plan prospectus and the Company’s annual report to the Director in electronic format.  If at any time the Director prefers to receive paper copies of such documents, as the Director is entitled to, the Company will provide copies.  Request for paper copies of such documents may be made to the Secretary of the Company at [916-321-1940 or bmcconkey@mcclatchy.com].

(d)Entire Agreement.  This Agreement, the Program and the Plan constitute the entire contract between the parties hereto with regard to the subject matter hereof.

3

Any prior agreements, commitments, or negotiations concerning the Deferred Stock Units are superseded.

(e)Choice of Law.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of California, as such laws are applied to contracts entered into and performed in such State.

(f)Data Privacy.  To administer the Plan and the Program, the Company may process personal data about the Director.  Such data includes, but is not limited to, information provided in this Agreement and any changes thereto, other appropriate personal and financial data about the Director, such as contact information, payroll information, and any other information that might be deemed appropriate by the Company to facilitate the administration of the Plan and the Program.  By accepting the Deferred Stock Units, the Director gives explicit consent to the Company to process any such personal data.

4

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by its officer duly authorized to act on behalf of the Committee, and the Director has personally executed this Agreement.

THE McCLATCHY COMPANY
By
	Secretary
Company's Address:
	2100 Q Street
	Sacramento, CA 95816
Director
By
Director's Address:

5

Exhibit A

STOCK AWARD deferral election agreement UNDER
THE MCCLATCHY COMPANY 2012 OMNIBUS INCENTIVE PLAN

Calendar Year 2016

	/		/			-		-
Print Full Name		Date of Birth			Social		Security
Number
Residence Address
Please complete and return the form to:				Lori Albright, Legal Department
				The McClatchy Company
				2100 Q Street
				Sacramento, CA 95816-6899

STOCK AWARD DEFERRAL ELECTION

In accordance with the terms of The McClatchy Company 2012 Omnibus Incentive Plan and the Director Deferral Program thereunder (together, the “Plan”), I hereby make the following election with respect to any shares of Stock granted to me under the Plan as Unrestricted Stock (such award, the “2016 Stock Award”) by virtue of my 2016 Service as a nonemployee member of the Board of Directors of The McClatchy Company (the “Company”)

¨ I elect to defer 100% of my 2016 Stock Award.  In accordance with the terms of the Plan and this Stock Award Deferral Election Agreement, my 2016 Stock Award shall be distributed (1) as soon as practicable following my “separation from service” (within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended) from the Company, but in no event later than March 15 of the year immediately following my separation from service and (2) in the form of a single lump sum distribution of Stock.     

Certain capitalized terms used herein are defined in the Plan and have the meaning set forth in the Plan.

ACKNOWLEDGEMENT & SIGNATURE

I also acknowledge and agree to the following:

6

Ø I understand that this Stock Award Deferral Election Agreement must be executed and delivered to the Company by December 31, 2015 for any deferral election to be valid.

Ø I understand that, if timely executed and delivered to the Company, this Stock Award Deferral Election Agreement will be given effect on December 31, 2015 and will be irrevocable on or after such date.

Accepted and Agreed:

Signature Date

Company Use: 

Date of receipt: _________________, 20___        Initials:  ________________

Beneficiary Designation FORM UNDER
THE MCCLATCHY COMPANY 2012 OMNIBUS INCENTIVE PLAN
Calendar Year 2016

	/		/		-		-
Print Full Name		Date of Birth		Social		Security
Number

If my “separation from service” (within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended) from The McClatchy Company (the “Company”) is on account of my death, then the distribution of Stock with respect to my deferral of all shares of Stock granted to me under The McClatchy Company 2012 Omnibus Incentive Plan and the Director Deferral Program thereunder (together, the “Plan”) as Unrestricted Stock (such award, the “2016 Stock Award”) by virtue of my 2016 Service as a nonemployee member of the Company’s Board of Directors will be paid to my designated beneficiary(ies) at the time of my death according to this beneficiary designation.  (Certain capitalized terms used herein are defined in the Plan and have the meaning set forth in the Plan.)  Payment is to be made as follows [please choose only one]:

q To my surviving spouse.

q To all of my children who survive me in equal shares. [Please provide names and addresses below.] The term “children” means natural or legally adopted children but excludes stepchildren (if not adopted).

q To my estate.

q Other [please enter a description, and provide names and addresses, if necessary]:

______________________________________________________

______________________________________________________

In the event no designated beneficiary survives me, any remaining payments shall be made to my estate. 

7

The names and addresses of my beneficiaries are as follows [please use a separate sheet if necessary]:

1.   Name:	Relationship:
Address:		SSN:
2.   Name:	Relationship:
Address:		SSN:
3.   Name:	Relationship:
Address:		SSN:
4.   Name:	Relationship:
Address:		SSN:

This beneficiary designation is to take effect on the date when it is received by:

Lori Albright, Legal Department

The McClatchy Company

2100 Q Street

Sacramento, CA 95816-6899

This beneficiary designation supersedes any prior designations that I may have made concerning the above-referenced 2016 Stock Award.

Signature Date

Company Use: 

Date of receipt: __________________, 20__                             Initials:  ________________

8

EX-10.31

Exhibit 10.31

STOCK AWARD deferral election agreement UNDER
THE MCCLATCHY COMPANY 2012 OMNIBUS INCENTIVE PLAN

Calendar Year 2016

	/		/		-	-
Print Full Name		Date of Birth		SocialSecurityNumber
Residence Address
Please complete and return the form to:				Lori Albright, Legal Department
				The McClatchy Company
				2100 Q Street
				Sacramento, CA 95816-6899

STOCK AWARD DEFERRAL ELECTION

In accordance with the terms of The McClatchy Company 2012 Omnibus Incentive Plan and the Director Deferral Program thereunder (together, the “Plan”), I hereby make the following election with respect to any shares of Stock granted to me under the Plan as Unrestricted Stock (such award, the “2016Stock Award”) by virtue of my 2016Service as a nonemployee member oftheBoard of Directors of The McClatchy Company (the “Company”)

¨ I elect to defer 100% of my 2016 Stock Award.  In accordance with the terms of the Plan and this Stock Award Deferral Election Agreement, my 2016 Stock Award shall be distributed (1) as soon as practicable following my “separation from service” (within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended) from the Company, but in no event later than March 15 of the year immediately following my separation from service and (2) in the form of a single lump sum distribution of Stock.  

Certain capitalized terms used herein are defined in the Plan and have the meaning set forth in the Plan.

ACKNOWLEDGEMENT & SIGNATURE

I also acknowledge and agree to the following:

Ø I understand that this Stock Award Deferral Election Agreement must be executed and delivered to the Company by December 31, 2015 for any deferral election to be valid.

Ø I understand that, if timely executed and delivered to the Company, this Stock Award Deferral Election Agreement will be given effect on December 31, 2015 and will be irrevocable on or after such date.

Accepted and Agreed:

Signature Date

Company Use: 

Date of receipt: _________________, 20___                                                                                    Initials:  ________________

Beneficiary Designation FORM UNDER
THE MCCLATCHY COMPANY 2012 OMNIBUS INCENTIVE PLAN
Calendar Year 2016

	/		/		-	-
Print Full Name		Date of Birth		SocialSecurityNumber

If my “separation from service” (within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended) from The McClatchy Company (the “Company”) is on account of my death, then the distribution of Stock with respect to my deferral of all shares of Stock granted to me under The McClatchy Company 2012 Omnibus Incentive Plan and the Director Deferral Program thereunder (together, the “Plan”) as Unrestricted Stock (such award, the “2016 Stock Award”) by virtue of my 2016 Service as a nonemployee member of the Company’s Board of Directors will be paid to my designated beneficiary(ies) at the time of my death according to this beneficiary designation.  (Certain capitalized terms used herein are defined in the Plan and have the meaning set forth in the Plan.)Payment is to be made as follows  [please choose only one]:

q To my surviving spouse.

q To all of my children who survive me in equal shares. [Please provide names and addresses below.] The term “children” means natural or legally adopted children but excludes stepchildren (if not adopted).

q To my estate.

q Other [please enter a description, and provide names and addresses, if necessary]:

______________________________________________________

______________________________________________________

In the event no designated beneficiary survives me, any remaining payments shall be made to my estate. 

The names and addresses of my beneficiaries are as follows [please use a separate sheet if necessary]:

1.   Name:	Relationship:
Address:		SSN:
2.   Name:	Relationship:
Address:		SSN:
3.   Name:	Relationship:
Address:		SSN:
4.   Name:	Relationship:
Address:		SSN:

This beneficiary designation is to take effect on the date when it is received by:

Lori Albright, Legal Department

The McClatchy Company

2100 Q Street

Sacramento, CA 95816-6899

This beneficiary designation supersedes any prior designations that I may have made concerning the above-referenced 2016Stock Award.

Signature Date

Company Use: 

Date of receipt: __________________, 20__ Initials:  ________________

EX-12

Exhibit 12

The McClatchy Company

COMPUTATION OF EARNINGS TO FIXED CHARGES RATIO

(in thousands of dollars, except ratio data)

		Year Ended
	December 27,		December 28,		December 29,		December 30,		December 25,
	2015		2014		2013		2012		2011
Fixed Charge Computation
Interest expenses:
Net interest expense	$	85,973	$	127,503	$	135,381	$	151,334	$	165,434
Plus: capitalized interest		100		434		798		748		193
Gross interest		86,073		127,937		136,179		152,082		165,627
Interest on unrecognized tax benefits		293		(131)		735		11,689		5,960
Amortization of debt discount		(3,550)		(6,063)		(6,673)		(9,821)		(11,092)
Interest component of rent expense		4,319		4,859		4,585		5,666		4,509
Total fixed charges		87,135		126,602		134,826		159,616		165,004
Earnings Computation
Income (loss) from continuing operations
before income taxes (1)		(311,959)		607,207		28,103		(27,691)		56,463
Earnings of equity investments		(10,086)		(19,084)		(42,651)		(31,935)		(27,762)
Impairment related charge recorded by equity investee (2)		7,500		—		—		—		—
Interest on unrecognized tax benefits		(293)		131		(735)		(735)		(11,689)
Distributed income of equity investees (3)		14,960		162,329		42,436		38,600		31,625
Add: fixed charges		87,135		126,602		134,826		134,826		159,616
Less: capitalized interest		(100)		(434)		(798)		(798)		(748)
Total earnings (loss) as adjusted	$	(212,843)	$	876,751	$	161,181	$	112,266	$	207,505
Ratio Of Earnings to Fixed Charges (4)		—		6.93		1.20		0.70		1.26

⁽¹⁾ The income from continuing operations before taxes in 2015 includes non-cash impairment charges of $304.8 million for goodwill and intangibles, and 2014 includes a gain on sale of our equity investments of $561.0 million.

⁽²⁾ Reflects the Company's portion of loss related to an impairment and it is recorded in "Equity income in unconsolidated companies, net" in the Consolidated Statements of Operations.

⁽³⁾ The distributed income of equity investees in 2014 includes the Company's portion (approximately $147 million) of Classified Ventures LLP's sale of the Apartments.com business.

⁽⁴⁾ Earnings were inadequate to cover fixed charges by $214 million for the year ended December 27, 2015, as a result of non-cash charges of $304.8 million.

EX-21

Exhibit 21

THE MCCLATCHY COMPANY

SUBSIDIARIES

The following is a list of subsidiaries of the Company as of December 27, 2015, omitting subsidiaries which, considered in the aggregate, would not constitute a significant subsidiary.

Name of Entity	Jurisdiction of Organization
Aboard Publishing, Inc.	Florida
Bellingham Herald Publishing, LLC	Delaware
Belton Publishing Company, Inc.	Missouri
Big Valley, Inc.	California
Biscayne Bay Publishing, Inc.	Florida
Cass County Publishing Company	Missouri
Columbus‑Ledger Enquirer, Inc.	Georgia
Cypress Media, Inc.	New York
Cypress Media, LLC	Delaware
Dagren, Inc.	Florida
Double A Publishing, Inc.	Florida
East Coast Newspapers, Inc.	South Carolina
El Dorado Newspapers	California
Gulf Publishing Company, Inc.	Mississippi
HLB Newspapers, Inc.	Missouri
Idaho Statesman Publishing, LLC	Delaware
Keltatim Publishing Company, Inc.	Kansas
Keynoter Publishing Company, Inc.	Florida
Lee’s Summit Journal, Inc.	Missouri
Lexington H‑L Services, Inc.	Kentucky
Macon Telegraph Publishing Company	Georgia
Mail Advertising Corporation	Texas
McClatchy Interactive LLC	Delaware
McClatchy Interactive West	Delaware
McClatchy International, Inc.	Delaware
McClatchy Investment Company	Delaware
McClatchy Leasing Company, Inc.	Florida
McClatchy Management Services, Inc.	Delaware
McClatchy Net Ventures, Inc.	Delaware
McClatchy News Services, Inc.	Michigan
McClatchy Newspaper Sales, Inc.	New York
McClatchy Newspapers, Inc.	Delaware
McClatchy Newsprint Company	Florida
McClatchy Property, Inc.	Florida
McClatchy Resources, Inc.	Florida
McClatchy Sales, Inc.	Delaware
McClatchy Shared Services, Inc.	Florida
McClatchy U.S.A., Inc.	Delaware
Mediastream, Inc.	Delaware
Miami Herald Media Company	Delaware
N&O Holdings, Inc.	Delaware
Newsprint Ventures, Inc.	California
Nittany Printing and Publishing Company	Pennsylvania
Nor‑Tex Publishing, Inc.	Texas
Oak Street Redevelopment Corporation	Missouri
Olympian Publishing, LLC	Delaware
Olympic‑Cascade Publishing, Inc.	Washington
Pacific Northwest Publishing Company, Inc.	Florida
Quad County Publishing, Inc.	Illinois
Richwood, Inc.	Florida
Runways Pub, Inc.	Delaware
San Luis Obispo Tribune, LLC	Delaware
Star‑Telegram, Inc.	Delaware
Tacoma News, Inc.	Washington
The Bradenton Herald, Inc.	Florida
The Charlotte Observer Publishing Company	Delaware
The Gables Publishing Company	Florida
The News and Observer Publishing Company	North Carolina
The State Media Company	South Carolina
The Sun Publishing Company, Inc.	South Carolina
Tribune Newsprint Company	Utah
Wichita Eagle and Beacon Publishing Company, Inc.	Kansas
Wingate Paper Company	Delaware

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statements No. 333‑181167 on Form S‑8 and No. 333‑47909 on Form S‑3 of our report dated March 7, 2016, relating to the consolidated financial statements of The McClatchy Company, and the effectiveness of The McClatchy Company’s internal control over financial reporting, appearing in this Annual Report on Form 10‑K of The McClatchy Company for the year ended December 27, 2015.

/s/ Deloitte & Touche LLP

Sacramento, California

March 7, 2016

EX-23.1

Exhibit 23.1

Consentof IndependentAuditors

We consent to the incorporation by reference in the Registration Statement on Form S‑3 (No. 333‑47909) and onForm S‑8 (No. 333‑181167) of The McClatchy Company of our report dated March3, 2014,  with respect to the consolidated financial statements of CareerBuilder, LLC and Subsidiaries included in this Form 10-K of The McClatchy Company for the year ended December 27, 2015.

/s/ Ernst & Young LLP

March 7, 2016

McLean, VA

EX-23.2

Exhibit 23.2

Consentof IndependentAccountants

We consent to the incorporation by reference in the Registration Statements on Form S‑8 (333‑181167) and onForm S‑3  (No. 333‑47909)  of The McClatchy Company of our report dated February 21, 2014, relating to the financial statements of Classified Ventures, LLC, which appears in this Form 10-K.

/s/ PricewaterhouseCoopers LLP

Chicago, Illinois

March 7, 2016

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Patrick J. Talamantes, certify that:

1. I have reviewed this annual report on Form 10‑K of The McClatchy Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e) and 15d‑15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a‑15(f) and 15d‑15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

3	Chief Executive Officer
Date: March 7, 2016	/s/ Patrick J. Talamantes    Patrick J. Talamantes    Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, R. Elaine Lintecum, certify that:

1. I have reviewed this annual report on Form 10‑K of The McClatchy Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e) and 15d‑15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a‑15(f) and 15d‑15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	Chief Financial Officer
Date: March 7, 2016	/s/ R. Elaine Lintecum    R. Elaine Lintecum    Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES‑OXLEY ACT OF 2002

In connection with the annual report of The McClatchy Company (the “Company”) on Form 10‑K for the fiscal year ended December 27, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Patrick J. Talamantes, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

	Chief Executive Officer
Dated: March 7, 2016	/s/ Patrick J. Talamantes    Patrick J. Talamantes    Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to The McClatchy Company and will be retained by The McClatchy Company and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certificate is being furnished to the Securities and Exchange Commission as an exhibit to the Form 10‑K and shall not be considered filed as part of the Form 10‑K.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES‑OXLEY ACT OF 2002

In connection with the annual report of The McClatchy Company (the “Company”) on Form 10‑K for the fiscal year ended December 27, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, R. Elaine Lintecum, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

	Chief Financial Officer
Dated: March 7, 2016	/s/ R. Elaine Lintecum    R. Elaine Lintecum    Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to The McClatchy Company and will be retained by The McClatchy Company and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certificate is being furnished to the Securities and Exchange Commission as an exhibit to the Form 10‑K and shall not be considered filed as part of the Form 10‑K.

EX-99.1

Exhibit 99.1

Consolidated  Financial  Statements

CareerBuilder, LLC and Subsidiaries

Years Ended December 31, 2015 (Unaudited),

2014 (Unaudited), and 2013 (Audited)

CareerBuilder, LLC and Subsidiaries

Consolidated Financial Statements

Years Ended December 31, 2015 (Unaudited), 2014 (Unaudited),
and 2013 (Audited)

Contents

Report of Independent Auditors	1
Consolidated Balance Sheets	3
Consolidated Statements of Operations	4
Consolidated Statements of Comprehensive Income	5
Consolidated Statements of Equity	6
Consolidated Statements of Cash Flows	7
Notes to Consolidated Financial Statements	8

Report of Independent Auditors

The Board of Directors

CareerBuilder, LLC

We have audited the accompanying consolidated financial statements of CareerBuilder, LLC and Subsidiaries, which comprise the consolidated balance sheet as of December 31, 2013, and the related consolidated statements of operations, comprehensive income, equity, and cash flows for the year then ended, and the related notes to consolidated financial statements.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in conformity with U.S. generally accepted accounting principles; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

1

Opinion

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of CareerBuilder, LLC and Subsidiaries at December 31, 2013, and the consolidated results of their operations and their cash flows for the year then ended, in conformity with U.S. generally accepted accounting principles.

December 31, 2012 and 2011 Financial Statements

The accompanying consolidated balance sheet of CareerBuilder, LLC and Subsidiaries as of December 31, 2012, and the related consolidated statements of operations, comprehensive income, equity, and cash flows for the years ended December 31, 2012 and 2011, were not audited, reviewed, or compiled by us and, accordingly, we do not express an opinion or any other form of assurance on them.

/s/ Ernst & Young LLP

March 3, 2014

2

CareerBuilder, LLC and Subsidiaries

Consolidated Balance Sheets (unaudited)

(In Thousands)

	December 31
	2015		2014
Assets
Current assets:
Cash and cash equivalents	$	103,004	$	64,937
Investments in marketable securities		25,146		25,521
Accounts receivable, net of allowance of $1,647 and $1,673, respectively		98,194		95,445
Prepaid expenses		16,651		13,120
Other current assets		3,999		2,671
Total current assets		246,994		201,694
Property and equipment, net of accumulated depreciation		40,081		31,486
Goodwill		382,169		417,629
Intangible assets, net of accumulated amortization		34,130		41,397
Other noncurrent assets		2,949		2,372
Total assets	$	706,323	$	694,578
Liabilities, redeemable noncontrolling interest, and equity
Current liabilities:
Accounts payable	$	13,397	$	9,702
Due to related parties		387		630
Accrued expenses and other current liabilities		17,342		17,556
Accrued compensation-related expenses		29,287		36,603
Accrued interactive marketing		1,948		3,214
Current portion of acquisition-related contingencies		484		7,950
Deferred revenue		127,175		127,616
Total current liabilities		190,020		203,271
Noncurrent liabilities:
Acquisition-related contingencies, less current portion		—		986
Other noncurrent liabilities		23,105		20,294
Total liabilities		213,125		224,551
Redeemable noncontrolling interest		24,666		20,470
Commitments and contingencies (Note 12)
Equity:
Paid-in capital		293,679		346,084
Retained earnings		207,205		126,925
Accumulated other comprehensive loss, net		(32,413)		(23,514)
Total CareerBuilder equity		468,471		449,495
Noncontrolling interest		61		62
Total equity		468,532		449,557
Total liabilities, redeemable noncontrolling interest, and equity	$	706,323	$	694,578

See accompanying notes.

3

CareerBuilder, LLC and Subsidiaries

Consolidated Statements of Operations

(In Thousands)

	Year Ended December 31
	2015		2014		2013
	(Unaudited)		(Unaudited)		(Audited)
Revenues	$	698,041	$	713,306	$	678,595
Operating expenses:
Cost of revenue		45,269		71,252		78,183
Sales and marketing		325,030		329,721		323,468
Product development		78,677		70,572		65,180
General and administrative		82,667		75,803		68,267
Depreciation and amortization		32,235		29,739		25,915
Goodwill impairment charge		50,012		—		—
Changes in fair value of acquisition-related contingencies		(48)		(4,594)		1,123
Total operating expenses		613,842		572,493		562,136
Income from operations		84,199		140,813		116,459
Investment (loss) income		(352)		258		2,511
Other expense, net		(2,119)		(2,202)		(72)
Income before income taxes		81,728		138,869		118,898
Income tax (expense) benefit		(923)		(453)		16
Net income		80,805		138,416		118,914
Net (income) loss attributable to noncontrolling interest		(525)		(686)		448
Net income attributable to CareerBuilder, LLC	$	80,280	$	137,730	$	119,362

See accompanying notes.

4

CareerBuilder, LLC and Subsidiaries

Consolidated Statements of Comprehensive Income

(In Thousands)

	Year Ended December 31
	2015		2014		2013
	(Unaudited)		(Unaudited)		(Audited)
Net income	$	80,805	$	138,416	$	118,914
Foreign currency translation (loss) gain		(8,899)		(10,597)		1,559
Total other comprehensive (loss) income		(8,899)		(10,597)		1,559
Comprehensive income		71,906		127,819		120,473
Comprehensive (income) loss attributable to noncontrolling interest		(525)		(686)		448
Comprehensive income attributable to CareerBuilder, LLC	$	71,381	$	127,133	$	120,921

See accompanying notes.

5

CareerBuilder, LLC and Subsidiaries

Consolidated Statements of Equity

(In Thousands)

Years Ended December 31, 2015 (Unaudited), 2014 (Unaudited), and 2013 (Audited)

			Retained		Accumulated
			Earnings		Other
	Paid-In		(Accumulated		Comprehensive		Noncontrolling
	Capital		Deficit)		Income (Loss)		Interest		Total
Balances, December 31, 2012	$	492,136	$	(130,167)	$	(14,476)	$	—	$	347,493
Net income		—		119,362		—		(448)		118,914
Redeemable noncontrolling interest		(5,012)		—		—		441		(4,571)
Contributions from noncontrolling interest holders		—		—		—		71		71
Dividend to members		(90,000)		—		—		—		(90,000)
Other comprehensive income		—		—		1,559		—		1,559
Balances, December 31, 2013		397,124		(10,805)		(12,917)		64		373,466
Net income		—		137,730		—		686		138,416
Redeemable noncontrolling interest		(6,040)		—		—		(688)		(6,728)
Dividend to members		(45,000)		—		—		—		(45,000)
Other comprehensive loss		—		—		(10,597)		—		(10,597)
Balances, December 31, 2014		346,084		126,925		(23,514)		62		449,557
Net income		—		80,280		—		525		80,805
Redeemable noncontrolling interest		(2,405)		—		—		(526)		(2,931)
Dividend to members		(50,000)		—		—		—		(50,000)
Other comprehensive loss		—		—		(8,899)		—		(8,899)
Balances, December 31, 2015	$	293,679	$	207,205	$	(32,413)	$	61	$	468,532

See accompanying notes.

6

CareerBuilder, LLC and Subsidiaries

Consolidated Statements of Cash Flows

(In Thousands)

	Year Ended December 31
	2015		2014		2013
	(Unaudited)		(Unaudited)		(Audited)
Operating activities
Net income	$	80,805	$	138,416	$	118,914
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		32,235		29,739		25,915
Deferred income taxes		(878)		(1,191)		(573)
Provision for doubtful accounts		2,042		1,412		985
Goodwill impairment charge		50,012		—		—
Changes in fair value of acquisition-related contingencies		(48)		(4,594)		1,123
Realized and unrealized loss (gain) on marketable securities		375		(250)		(2,502)
Changes in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable		(5,056)		(8,655)		5,409
Prepaid expenses and other assets		(5,732)		640		(3,135)
Accounts payable		3,194		(2,825)		1,315
Due to related parties		(243)		(7,154)		503
Accrued expenses and other liabilities		(5,830)		(2,292)		1,748
Deferred revenue		202		3,726		(12,088)
Net cash provided by operating activities		151,078		146,972		137,614
Investing activities
Purchase of property and equipment		(29,217)		(21,867)		(20,228)
Proceeds from sale of property and equipment		194		—		—
Purchase of intangible asset		—		(608)		(15)
Purchases of marketable securities		—		(2,245)		(2,060)
Exercise of call option on redeemable noncontrolling interest		(8,850)		—		—
Acquisitions, net of cash acquired		(16,363)		(55,960)		(17,383)
Net cash used in investing activities		(54,236)		(80,680)		(39,686)
Financing activities
Payment of acquisition related contingencies		(7,288)		(15,553)		(5,505)
Dividends paid to members		(50,000)		(45,000)		(90,000)
Dividends paid to redeemable noncontrolling interest holders		(1,233)		(876)		(218)
Net cash used in financing activities		(58,521)		(61,429)		(95,723)
Effect of exchange rate fluctuations on cash		(254)		1,014		(1,315)
Net increase in cash and cash equivalents		38,067		5,877		890
Cash and cash equivalents at beginning of year		64,937		59,060		58,170
Cash and cash equivalents at end of year	$	103,004	$	64,937	$	59,060
Supplemental cash flow information
Income taxes paid	$	2,650	$	1,606	$	4,017

See accompanying notes.

7

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements

(In Thousands)

December 31, 2015

All 2015 and 2014 amounts included in the Notes to Consolidated Financial Statements are Unaudited.

1. Basis of Presentation

CareerBuilder, LLC, a Delaware limited liability company, and Subsidiaries (the Company), is a privately owned provider of global human capital solutions that helps employers target and attract employees. In addition to operating online career sites, such as CareerBuilder.com, the Company provides employers with recruitment resources ranging from labor market intelligence to talent management software and other recruitment solutions. At December 31, 2015, the Company was owned by TEGNA, Inc., Tribune National Marketing Company, and The McClatchy Company (the Members). The Company operates in the United States, and internationally in Canada, Asia, Europe, the Middle East, Australia and South America through its owned subsidiaries, joint ventures and partnerships.

2. Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly and majority-owned subsidiaries after elimination of all significant intercompany transactions and balances. Investments in which the Company does not have a controlling interest, or is not the primary beneficiary, are accounted for under the equity method. Equity method investments are included in other noncurrent assets in the Consolidated Balance Sheets, and the Company’s share of net earnings is included in other expense, net in the Consolidated Statements of Operations.

Cash and Cash Equivalents

Highly liquid investments with an original maturity of three months or less are classified as cash equivalents.

Letters of Credit

As of December 31, 2015 and 2014, the Company had standby unused letters of credit with financial institutions totaling $2,154 and $2,661, respectively.

Marketable Securities

At December 31, 2015 and 2014, the Company’s marketable securities were investments in mutual funds, and classified as trading securities with unrealized holding gains and losses included in the Company’s Consolidated Statements of Operations. These investments are classified as current assets given their short term liquidity.

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which range from two to five years. The costs of leasehold improvements are capitalized and amortized using the straight-line method over the shorter of their useful lives or the terms of the respective leases.

8

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

Business Acquisitions

The Company accounts for business acquisitions using the purchase method. The Company allocates the purchase price to the assets acquired and the liabilities assumed based on their estimated fair values at the date of acquisition, including identifiable intangible assets.

Goodwill

Goodwill represents the excess of the total purchase price of acquisitions over the fair value of the net identified tangible and intangible acquired assets. Goodwill generally results from the expansion of the Company’s market share, from intangible assets that do not qualify for separate recognition, and from expected synergies from combining operations with the acquired company. Goodwill is not amortized, but is subject to an impairment review annually, and whenever indicators of impairment exist. The Company tests for goodwill impairment at the reporting unit level using a qualitative assessment or a two-step quantitative analysis. The qualitative analysis includes consideration of factors including, but not limited to, macroeconomic conditions, industry and market conditions, cost factors that have an impact on earnings and cash flows, and other relevant entity specific or relevant factors affecting the reporting unit. If after performing the assessment, the Company concludes it is more likely than not that the fair value of the reporting unit is less than its carrying amount, then it is required to perform a two-step quantitative test. Otherwise, the two-step test is not required for the reporting units where the qualitative assessment is performed.

In the two-step quantitative analysis, the first step involves a comparison of the estimated fair value of the reporting unit with its carrying value. Fair value of the reporting unit is determined using various techniques, including multiple earnings and discounted cash flow valuation techniques. If the carrying value exceeds the fair value, the second step of the process is necessary. The second step measures the difference between the carrying value and implied fair value of goodwill. If the carrying value exceeds fair value, goodwill is considered impaired, and is reduced to fair value. See Note 8 for additional goodwill disclosures.

Intangible Assets

CareerBuilder has intangible assets including acquired technology, trademarks and customer relationships. Intangible assets acquired in business combinations are recorded at fair value on the date of acquisition and are amortized on a straight line basis over their estimated useful lives, which generally range from two to twelve years. Intangible assets subject to amortization are tested for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. CareerBuilder does not have any indefinite lived intangible assets other than goodwill.

Valuation of Long-Lived Assets

The Company evaluates the carrying value of long-lived assets to be held and used whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The carrying value of a long-lived asset is considered impaired when the projected undiscounted future cash flows are less than the carrying value of the asset. The Company measures impairment based on the amount by which the carrying value exceeds the fair value. Fair value is determined primarily using projected future cash flows, discounted at a rate commensurate with the risk involved. No impairment losses on long lived assets were incurred in 2015, 2014, and 2013.

9

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

Noncontrolling Interest

In July 2015, the Company acquired 60% of Textkernel B.V. (Textkernel).  See Note 4 for additional information on the acquisition.  Shareholders for the remaining 40% of ownership hold put rights that permit them to put their equity interest to the Company.

In March 2013, the Company purchased an 87.5% interest in VON Joint Stock Company (VON). See Note 4 for additional information on the acquisition. The Company entered into a Call and Put Option Agreement, which includes call rights for 12.5% and put rights for 11.5%. In May 2013, the Company exercised a call for 11.5%, and the remaining 1% is recorded as noncontrolling interest at December 31, 2015.

In August 2012, the Company acquired 74% of Economic Modeling, LLC (EMSI).  During 2015, the Company acquired an additional 11.3% for $8,850, bringing the Company’s ownership to 85.3%.  Shareholders for the remaining 14.7% of ownership hold put rights that permit them to put their equity interest to the Company.

Since redemption of the noncontrolling interest for Textkernel and EMSI is outside of the Company’s control, their equity interest is presented on the Consolidated Balance Sheets as redeemable noncontrolling interest. The exercise price of the puts are based on the fair value at the exercise date. The fair value of the redeemable noncontrolling interest is remeasured at the end of each reporting period. A summary of changes in redeemable noncontrolling interest for the years ended December 31, 2015 and 2014, is as follows:

Balance, December 31, 2013 (Audited)	$	14,618
Remeasurement of redeemable noncontrolling interest		6,040
Net gain attributable to redeemable noncontrolling interest		688
Distribution to noncontrolling interest members		(876)
Balance, December 31, 2014 (Unaudited)		20,470
Remeasurement of redeemable noncontrolling interest		2,405
Net gain attributable to redeemable noncontrolling interest		526
Foreign exchange adjustment		(101)
Distribution to noncontrolling interest members		(1,233)
Purchase of additional EMSI shares		(8,850)
Textkernel acquisition		11,449
Balance, December 31, 2015 (Unaudited)	$	24,666

Net income for the years ended December 31, 2015, 2014 and 2013, in the Consolidated Statements of Operations, reflect 100% of Textkernel, VON and EMSI results, since the respective acquisition dates, as the Company holds the controlling interest. Net income is subsequently adjusted to remove the noncontrolling interest to arrive at net income attributable to the Company.

Foreign Currency Translation

The income statements of foreign subsidiaries have been translated to U.S. dollars using the average currency exchange rates in effect during the relevant period. The Consolidated Balance Sheets have been translated using the currency exchange rate as of the end of the accounting period. The impact of currency exchange rate changes on the translation is included in other comprehensive income (loss) and is classified as accumulated other comprehensive income (loss) in Equity.

10

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

The Company uses forward foreign exchange rate contracts to manage risks related to non-functional currency contingent payments related to acquisitions. The Company does not engage in speculative derivative activities or derivative trading activities.

The Company recognizes all contracts that meet the definition of a derivative, as either assets or liabilities in the accompanying Consolidated Balance Sheets and measure those derivatives at fair value under accounting standards for derivatives and hedging. Changes to the fair value of the derivatives are recorded in the Consolidated Statements of Operations. The Company does not offset derivative assets and derivative liabilities in the accompanying Consolidated Balance Sheets. See Note 7 for additional information.

Revenue Recognition

The Company recognizes revenue when persuasive evidence of an arrangement exists, service has been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. Revenue from sales agreements that contain multiple deliverable elements is allocated to each element based on their relative selling price. Deliverables are treated as separate units of accounting if they have value to the customer on a standalone basis.

The sources of revenue include various types of recruitment solutions which consist of advertisements, employment branding services, talent intelligence, other recruitment support, and access to the Company’s online resume database and recruitment software as a service. Generally, recruitment solutions revenue is recognized once delivery has occurred, and revenue related to access to the online resume database and recruitment software as a service is recognized ratably over the subscription period. Amounts billed or collected in excess of revenue recognized are included as deferred revenue.

Cost of Revenue

Costs of revenue primarily include operating costs associated with hosting websites, merchant fees for online transactions, outsourcing fees associated with website operations, and commissions and fees paid to the Company’s members.

Advertising Costs

The Company expenses all advertising costs as incurred. Advertising expense was $64,993, $75,185, and $94,607 for the years ended December 31, 2015, 2014, and 2013, respectively.

Product and Website Development Costs

Development costs include the cost to purchase and develop software for internal use. The Company capitalizes certain costs incurred for software development. Costs incurred during the application-development stage for software developed internally, bought and further customized by outside vendors for the Company’s use, and software developed by a vendor for the Company’s proprietary use, have been capitalized. Development costs that include expenses incurred by the Company for research and development of the Company’s proprietary technology incorporated in the Company’s product offerings are expensed as incurred.

Income Taxes

The Company is a Limited Liability Company (LLC) which elected partnership treatment and, therefore, is not a taxable entity for U.S. federal income tax purposes, and in most states. There are some states that impose an income tax on LLCs, and the Company’s three domestic corporate subsidiaries and its foreign subsidiaries are subject to corporate

11

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

income taxes in their respective jurisdictions. The Company accounts for income taxes in accordance with the balance sheet method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributed to temporary differences between the financial statement and income tax basis of assets and liabilities and tax credit and operating loss carryforwards. Valuation allowances are established when management determines it is “more likely than not” that some portion or all of the deferred tax asset may not be realized. The Company considers all positive and negative evidence in evaluating its ability to realize its deferred income tax assets, including its historical operating results, ongoing tax planning, and forecast of future taxable income, on a jurisdiction- by-jurisdiction basis.

During 2015, the Company adopted the provisions of Accounting Standards Update (“ASU”) 2015-17, Balance Sheet Classification of Deferred Taxes. Under the new guidance, deferred taxes will no longer be divided between current and noncurrent amounts, simply presenting all deferred tax items as noncurrent.  The December 31, 2014 deferred taxes have been reclassified to be consistent with the 2015 presentation.

With respect to uncertain tax positions, the Company recognizes in the consolidated financial statements those tax positions determined to be “more likely than not” of being sustained upon examination, based on the technical merits of the positions. The Company records a liability for the difference between the benefit recognized and measured pursuant to the accounting guidance for income taxes and the tax position taken on its tax return. The Company’s policy is to recognize, when applicable, interest and penalties on uncertain tax positions as part of income tax expense. Management has analyzed the Company’s inventory of tax positions taken with respect to all applicable income tax issues (in each respective jurisdiction), and has concluded that no reserve for uncertain tax positions is required in the consolidated financial statements as of December 31, 2015 and 2014.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results may differ from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include asset impairments, reserves established for doubtful accounts, depreciation and amortization, business combinations, valuation allowances, litigation matters, and contingencies.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk consist principally of cash and accounts receivable. The Company maintains its cash and equivalents balances in the form of deposits with financial institutions. The Company maintains cash deposits with banks that at times exceed applicable insurance limits. The Company reduces its exposure to credit risk by maintaining such deposits with high-quality financial institutions that management believes are creditworthy.

The Company extends credit to its customers on an unsecured basis in the normal course of business. The Company maintains reserves for credit losses, and such losses have historically been within management’s expectations. The Company evaluates the collectability of its accounts receivable based on the length of time the receivable is past due and the anticipated future write-off based on historical experience. Accounts receivable are written off when all reasonable collection efforts have been exhausted. There are no customers that individually represent more than 10% of the Company’s accounts receivable as of December 31, 2015 or 2014, or more than 10% of revenues for the years ended December 31, 2015, 2014, or 2013.

12

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

Changes in the allowance for doubtful accounts are as follows:

	2015		2014		2013
		(Unaudited)		(Unaudited)		(Audited)
Balance at January 1	$	1,673	$	1,676	$	1,863
Acquisitions		30		165		45
Charges to expenses		2,042		1,412		985
Write-offs and other		(2,098)		(1,580)		(1,217)
Balance at December 31	$	1,647	$	1,673	$	1,676

Fair Value of Financial Instruments

The Company’s financial instruments include cash and cash equivalents, accounts receivable, marketable securities, accounts payable, accrued expenses, and amounts due to related parties. Due to the short-term nature of these items, the carrying values are deemed to approximate their fair values.

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers, that will supersede virtually all revenue recognition guidance in US generally accepted accounting principles. The core principle contemplated by ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. New disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers are also required. In July 2015, the FASB approved a one-year deferral of the effective date of the standard to 2018 for public companies, with an option that would permit companies to early adopt the standard in 2017. Early adoption prior to 2017 is not permitted. The new standard may be adopted either retrospectively or on a modified retrospective basis, which recognizes a cumulative catch up adjustment to the operating balance of retained earnings. In addition, the FASB is contemplating making additional changes to certain elements of the new standard. The Company is currently evaluating the methods of adoption allowed by the new standard and the effect the standard is expected to have on our consolidated financial statements and related disclosures.

3. Retirement and Incentive Plans

Defined-Contribution Plan

The Company sponsors a defined-contribution retirement plan available to substantially all U.S.-based employees. The Company has elected to match 50% of the first 6% of contributions made by participants. Participants are fully vested after two years of service. The Company expensed $5,749, $4,504, and $4,298 in matching contributions for the years ended December 31, 2015, 2014, and 2013, respectively.

Deferred Compensation Plan

The Company has established a management incentive plan to attract and retain key personnel. Cash awards are discretionary, and are typically based on the achievement of predetermined Company performance metrics. The awards vest in periods ranging from three to five years. Awards are expensed ratably over the vesting period. The related compensation expense was $5,372, $5,785, and $6,762 for the years ended December 31, 2015, 2014, and 2013, respectively.

13

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

4. Acquisitions

Below is a summary of the acquisitions completed from January 1, 2013 to December 31, 2015. The consolidated financial statements of the Company include the financial results of these acquisitions from the date of each acquisition.

2015 Acquisitions

In July 2015, the Company acquired 60% ownership interest in Textkernel, a software company based in the Netherlands that specializes in multilingual semantic search and matching recruitment technology.  In addition to the purchase agreement, the Company and the minority shareholders entered into a Shareholders Agreement which includes call and put rights for the remaining 40% ownership interest. The Company has the ability to call up to 20% of the shares in 2017 and all of the remaining shares in 2018 and 2020 and beyond. The noncontrolling owners have the option to put any of their remaining shares in 2019 and any outstanding noncontrolling interest shares in 2020 and beyond.

The purchase price (less cash acquired) of this acquisition was a cash payment of $16,363. The Company recorded $23,419 of goodwill and $6,044 of intangible assets related to this acquisition.  The Company also recorded the fair value of the redeemable noncontrolling interest of $11,449 related to Textkernel. The fair value was calculated using the estimated enterprise value at the acquisition date. The intangible assets associated with this acquisition consist of non-compete agreements, technology, customer relationships, and trade names which are being amortized on a straight-line basis over a weighted-average period of approximately 6.3 years.  Goodwill related to the purchase of Textkernel is not deductible for income tax purposes in the Netherlands.

In connection with the purchase of EMSI in 2012, the Company had the ability to call an additional 6.5% of the units in 2014 and all of the remaining units in 2015. The noncontrolling owners have the option to put any of their remaining units in 2016 and the Company has the option to call any outstanding noncontrolling interest units in 2017 and beyond. During 2015, the Company exercised call options to acquire an additional 11% for $8,624 and an additional .3% from other shareholders for $226, bringing the Company’s ownership to 85.3%.  In January of 2016, the Company revised the EMSI operating agreement.  The noncontrolling owners no longer have the option to put any of their shares to the Company in 2016 and can only put the shares in 2018.  In addition, the Company can no longer call shares in 2017 and 2018 and can only call shares in 2019 and beyond.  

2014 Acquisitions

In March 2014, the Company acquired all of the ownership interest in Broadbean Technology Limited (a UK entity), Broadbean Technology PTY (an Australian entity) and Broadbean Incorporated (a US entity), collectively “Broadbean.”  Broadbean is a leader in job distribution, candidate sourcing and big data analytics software.

The purchase price (less cash acquired) was a cash payment of $55,960. The Company recorded $37,841 of goodwill and $19,688 of intangible assets related to this acquisition. The intangible assets associated with this acquisition consist of noncompete agreements, technology, customer relationships, and trade names which are being amortized on a straight-line basis over a weighted-average period of approximately 5.3 years.  Goodwill related to the purchase of Broadbean Incorporated is deductible for domestic income tax purposes.  Goodwill related to Broadbean Technology Limited and Broadbean Technology PTY is not deductible for income tax purposes in their respective countries.

2013 Acquisitions

In March 2013, the Company purchased an 87.5% interest in VON Joint Stock Company, which operates as KiemViec.com, a leading careersite in Vietnam, and HR Vietnam, which specializes in recruitment and human resource

14

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

solutions for employers. In connection with the purchase, the Company entered into a Call and Put Option Agreement, which included call rights for 12.5% and put rights for 11.5%. In May 2013, the Company exercised a call for 11.5%, and the remaining 1% is recorded as noncontrolling interest at December 31, 2015.

In April 2013, the Company purchased all of the outstanding capital of Oil and Gas Job Search.com Limited, an online niche career site located in the United Kingdom.

The aggregate purchase price (less cash acquired) of these acquisitions was approximately $34,042, of which $17,383 was paid in cash, and $16,659 was recorded as a liability for the fair value of future payments related to contingent arrangements with the former owners of the businesses. The payments are contingent upon the businesses meeting certain earnings and revenue-based targets (see Note 7 for additional information). The Company recorded $28,121 of goodwill and $9,383 of intangible assets related to these acquisitions. The intangible assets associated with these acquisitions consist of noncompete agreements, technology, customer relationships, and trade names which are being amortized on a straight-line basis over a weighted-average period of approximately 6.2 years.

Goodwill from these acquisitions is not deductible for income tax purposes in their respective countries.

Other Acquisition Information

During the year ended December 31, 2015, the Company paid $5,510 and $1,778 in connection with the achievement of contingent consideration targets related to acquisitions made in 2013 and 2012 respectively. During the year ended December 31, 2014, the Company paid $10,101 and $3,217, and $2,235 in connection with the achievement of contingent consideration targets related to acquisitions made in 2013, 2012, and 2011 respectively. During the year ended December 31, 2013, the Company paid $2,407 and $3,098 in connection with the achievement of contingent consideration targets related to acquisitions made in 2012 and 2011, respectively. 

5. Property and Equipment

Property and equipment consisted of the following:

	December 31
	2015		2014
		(Unaudited)		(Unaudited)
Computer software and hardware	$	87,630	$	70,138
Furniture and equipment		17,089		13,810
Leasehold improvements		35,511		28,554
		140,230		112,502
Less accumulated depreciation		(100,149)		(81,016)
Property and equipment, net	$	40,081	$	31,486

Depreciation expense of property and equipment was $20,501, $18,031 and $16,725 for the years ended December 31, 2015, 2014, and 2013, respectively.

Unamortized computer software development costs for the years ended December 31, 2015, 2014 and 2013 were $7,712, $3,965 and $1,314, respectively and are included in computer software and hardware.  For the years ended December 31, 2015, 2014 and 2013 total amortization of capitalized computer software development costs was $2,710, $1,457 and $641, respectively and is included in depreciation and amortization on the Consolidated Statement of Operations.

15

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

6. Investments in Marketable Securities

The Company’s investments at December 31, 2015 and 2014 are mutual funds held in conjunction with the Company’s deferred compensation plan (see Note 3 for additional information), which are classified as trading securities.

For the year ending December 31, 2015, a net loss of $375 was recorded related to trading securities in the Consolidated Statement of Operations, of which $875 were realized gains. For the year ending December 31, 2014, a net gain of $250 was recorded related to trading securities in the Consolidated Statement of Operations, of which $843 were realized. For the year ending December 31, 2013, $2,502 of gains related to trading securities were recorded in the Consolidated Statement of Operations, of which $630 were realized.

7. Fair Value Measurement

The Company values its financial assets and liabilities based on the fair value hierarchy in accordance with ASC Topic 820, Fair Value Measurements and Disclosures. The hierarchy consists of three levels:

Level 1 – Quoted market prices in active markets for identical assets or liabilities.

Level 2 – Inputs other than Level 1 inputs that are either directly or indirectly observable.

Level 3 – Unobservable inputs developed using estimates and assumptions developed by the Company, which reflect those that a market participant would use.

Financial assets and liabilities measured at fair value at December 31, 2015 and 2014 based on the fair value hierarchy are as follows:

	December 31, 2015
	Level 1		Level 2		Level 3		Total
	(Unaudited)
Assets:
Foreign exchange contracts	$	—	$	515	$	—	$	515
Mutual funds		25,146		—		—		25,146
Total assets	$	25,146	$	515	$	—	$	25,661
Liabilities:
Foreign exchange contracts	$	—	$	88	$	—	$	88
Acquisition-related contingency		—		—		484		484
Total liabilities	$	—	$	88	$	484	$	572

16

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

	December 31, 2014
	Level 1		Level 2		Level 3		Total
	(Unaudited)
Assets:
Foreign exchange contracts	$	—	$	1,132	$	—	$	1,132
Mutual funds		25,521		—		—		25,521
Total assets	$	25,521	$	1,132	$	—	$	26,653
Liabilities:
Foreign exchange contracts	$	—	$	124	$	—	$	124
Acquisition-related contingency		—		—		8,936		8,936
Total liabilities	$	—	$	124	$	8,936	$	9,060

The mutual funds are valued using quoted prices in the market.

The foreign exchange forwards are valued using pricing models that use observable inputs and, therefore, are classified as Level 2. As of December 31, 2015 and 2014, the fair value of derivative instruments were as follows:

	December 31, 2015
		Notional
	Component of	Amount		Fair Value
			(Unaudited)
Foreign currency exchange forwards	Other current assets	$	2,539	$	515
Foreign currency exchange forwards	Accrued expenses and other current liabilities		1,900		(88)
Total derivative instruments		$	4,439	$	427

	December 31, 2014
		Notional
	Component of	Amount		Fair Value
			(Unaudited)
Foreign currency exchange forwards	Other current assets	$	13,112	$	820
Foreign currency exchange forwards	Other noncurrent assets		5,092		312
Foreign currency exchange forwards	Accrued expenses and other current liabilities		2,641		(74)
Foreign currency exchange forwards	Other noncurrent liabilities		1,476		(50)
Total derivative instruments		$	22,321	$	1,008

The corresponding unrealized gains (losses) were ($582), $1,966 and ($399), which are included in other expense, net in the Consolidated Statements of Operations for the years ended December 31, 2015, 2014 and 2013, respectively. Realized gains (losses) of $1,358, ($362) and ($145) were also included in other expense, net in the Consolidated Statements of Operations for the years ended December 31, 2015, 2014, and 2013 respectively.

17

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

As part of certain acquisitions, the Company has agreed to pay the sellers earn-outs based on the financial performance of the acquired businesses. The acquisition-related contingency in the table below represents the estimated fair value of future amounts payable under such agreements. The fair value of the contingent payments is measured based on the present value of the consideration expected to be transferred. The discount rate is a significant unobservable input in such present value computations.  The discount rate is 23.8% based on the risk associated with the cash flows. Changes in the acquisition-related contingencies for the years ended December 31, 2015 and 2014, are as follows:

	Amount
Balance, December 31, 2013 (Audited)		29,597
Payments of contingencies		(15,553)
Change in fair value		(4,594)
Foreign exchange adjustment		(514)
Balance, December 31, 2014 (Unaudited)	$	8,936
Payments of contingencies		(7,288)
Change in fair value		(48)
Foreign exchange adjustment		(1,116)
Balance, December 31, 2015 (Unaudited)	$	484

Certain assets and liabilities are measured at fair value on a nonrecurring basis, and therefore, not included in the tables above. These assets include goodwill and intangible assets and result as acquisitions occur. The amounts assigned to intangible assets and goodwill as they relate to the Company’s acquisitions are based on the Company’s best estimate of the fair value. The Company uses an independent valuation specialist to assist in determining the fair value of the identified intangible assets at acquisition. The fair value of the significant identified intangible assets is generally estimated by performing a discounted cash flow analysis using the “income” approach, which represents a Level 3 fair value measurement. The income approach includes a forecast of direct revenues and costs associated with the respective intangible assets and charges for economic returns on tangible and intangible assets utilized in cash flow generation. Net cash flows attributable to the identified intangible assets are discounted to their present value at a rate commensurate with the perceived risk.

8. Goodwill

A summary of changes in goodwill for the years ended December 31, 2015 and 2014, is as follows:

	Gross				Net
	Goodwill		Impairments		Goodwill
Balance, December 31, 2013 (Audited)		437,451		(46,796)		390,655
Acquisitions		37,841		—		37,841
Currency translation adjustment		(10,867)		—		(10,867)
Balance, December 31, 2014 (Unaudited)	$	464,425	$	(46,796)	$	417,629
Acquisitions		23,419		—		23,419
Impairment		—		(50,012)		(50,012)
Currency translation adjustment		(8,867)		—		(8,867)
Balance, December 31, 2015 (Unaudited)	$	478,977	$	(96,808)	$	382,169

In 2015, Management has determined the Company has two reporting units – North America and International. In 2014, there were three reporting units - North America, EMEA, and APAC. As of January 1, 2015, due to certain internal restructurings, the EMEA and APAC were combined into the International reporting unit.

18

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

The Company performs the required annual impairment assessment of the goodwill at the reporting unit level on October 1. Due to the economic challenges primarily in Europe the International reporting unit did not pass the first-step of the quantitative analysis. In the second step, the carrying value of the goodwill exceeded the implied fair value of the goodwill by $50,012. Therefore, an impairment of $50,012 associated with the International reporting unit was recorded in the Consolidated Statement of Operations for the year ended December 31, 2015. There was no impairment in the North America reporting unit in 2015. Management noted no impairment in any of the reporting units in 2014 or 2013.

9. Intangible Assets

A summary of intangible assets by type is as follows:

	December 31, 2015
			Trade and
			Internet
	Customer		Domain
	Relationships		Names		Other		Total
		(Unaudited)
Gross intangible assets	$	61,510	$	42,549	$	23,859	$	127,918
Accumulated amortization		(41,350)		(36,254)		(16,184)		(93,788)
Intangible assets, net	$	20,160	$	6,295	$	7,675	$	34,130

	December 31, 2014
			Trade and
			Internet
	Customer		Domain
	Relationships		Names		Other		Total
		(Unaudited)
Gross intangible assets	$	62,694	$	42,953	$	20,689	$	126,336
Accumulated amortization		(38,095)		(35,555)		(11,289)		(84,939)
Intangible assets, net	$	24,599	$	7,398	$	9,400	$	41,397

In December 2014, the Company acquired software to power employee referral programs using social media for $608, which is being amortized on a straight-line basis over a period of 3 years.

Amortization expense of intangible assets was $11,734, $11,708, and $9,190 for the years ended December 31, 2015, 2014, and 2013, respectively. Based upon the current amount of intangibles subject to amortization, the estimated amortization expense for each of the succeeding five years is as follows: 2016: $10,226; 2017: $7,924; 2018: $5,985; 2019: $4,548; 2020: $3,577.

10. Related-Party Transactions

The Company has operating agreements with the Members under which the Company earns revenue and incurs expense. Related-party transaction types and amounts related to Member relationships are shown in the table below:

	For the Year Ended December 31
	2015		2014		2013
	(Unaudited)		(Unaudited)		(Audited)
Wholesale product sales, included in revenue	$	8,740	$	19,312	$	20,061
Revenue share fees, included in cost of revenue		9,664		34,716		43,759
Advertising fees, included in sales and marketing		4,445		7,982		9,297

19

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

Gross amounts due from the Members as of December 31, 2015 and 2014 amounted to $24 and $4,112, respectively. Gross amounts due to the Members as of December 31, 2015 and 2014 amounted to $411 and $4,742, respectively. These amounts are reflected on a net basis in the Consolidated Balance Sheets.

11. Income Taxes

Deferred tax assets and liabilities are as follows:

	December 31
	2015		2014
		(Unaudited)		(Unaudited)
Deferred tax assets:
Foreign tax loss carryforwards	$	41,735	$	37,754
Other		733		583
Valuation allowance		(41,174)		(36,060)
Total deferred tax assets		1,294		2,277
Deferred tax liabilities:
Intangible assets		6,110		7,079
Net deferred tax liability	$	4,816	$	4,802

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. Based upon the level of historical pretax losses and projections for future taxable income over the periods in which the deferred tax assets are deductible, management concluded that it was not more likely than not that the Company would fully realize the benefits of its tax loss carryforwards and deductible differences in some of the foreign locations and for U.S. corporate entities.

Sources of income from continuing operations before income taxes are as follows:

	Year Ended December 31
	2015		2014		2013
		(Unaudited)		(Unaudited)		(Audited)
U.S.	$	148,304	$	148,407	$	137,295
Foreign		(66,576)		(9,538)		(18,397)
Total	$	81,728	$	138,869	$	118,898

20

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

The components of the income tax expense (benefit) are as follows:

	Year Ended December 31
	2015		2014		2013
		(Unaudited)		(Unaudited)		(Audited)
Current income tax expense:
U.S. — state	$	322	$	46	$	377
Foreign		1,479		1,598		180
Total current income tax expense		1,801		1,644		557
Deferred income tax expense (benefit):
U.S. — state		110		(47)		156
Foreign		(988)		(1,144)		(729)
Total deferred income tax benefit		(878)		(1,191)		(573)
Income tax expense (benefit)	$	923	$	453	$	(16)

The income tax benefit differs from the amount computed by applying the statutory U.S. federal income tax rate of 35% to income before income taxes. The sources and tax effects of the differences are as follows:

	Year Ended December 31
	2015		2014		2013
		(Unaudited)		(Unaudited)		(Audited)
Income taxes at U.S. federal statutory rate	$	28,605	$	48,604	$	41,614
U.S. income not subject to tax		(50,912)		(48,546)		(45,070)
Increase in valuation allowance		7,101		5,451		6,802
Foreign rate differential		(1,405)		(3,571)		(4,314)
State taxes net of federal		46		169		151
Goodwill write-off		17,504		—		—
Other		(15)		(1,654)		801
Income tax expense (benefit)	$	924	$	453	$	(16)

The Company and its subsidiaries file income tax returns in the U.S., various states, provinces, and foreign jurisdictions. The Company’s federal, state, local, and most other foreign tax returns remain subject to examination for the year ended December 31, 2012, and all subsequent periods.

As of December 31, 2015, the Company has net operating loss (NOL) carryforwards, primarily in foreign jurisdictions, of approximately $152,616, which will be available to offset future taxable income. If not used, these NOL carryforwards will begin to expire in 2018.

21

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

12. Commitments and Contingencies

Leases

As of December 31, 2015, future minimum rental payments under noncancelable operating leases are as follows:

	Amount
2016	$	12,099
2017		11,979
2018		11,054
2019		8,642
2020		4,753
Thereafter		10,196
	$	58,723

Rental expense under noncancelable operating leases was $9,717, $9,367, and $8,486 for the years ended December 31, 2015, 2014, and 2013, respectively. Certain of the Company’s leases contain renewal options and rent escalation provisions.

Other Contractual Commitments

The Company has entered into noncancelable contracts for various services, including marketing partnerships, hardware and software maintenance, and facilities expenses. As of December 31, 2015, these future commitments totaled $76,409.

Legal Matters

The Company is currently party to routine litigation incidental to its business, none of which, individually or in the aggregate, is expected to have a material adverse effect on the Company.

13. Equity

Each Member’s ownership interest is used to determine the distribution of profits and losses and the allocation of capital contributions as required. TEGNA Inc. (TEGNA) and Tribune National Marketing Company (Tribune) each hold Class A membership interests of approximately 52.9% and 32.1%, respectively. TEGNA has the right to designate three directors to serve on the Company’s Board of Directors (Board), one being the chairman. The McClatchy Company (McClatchy) holds the remaining 15% with Class B nonvoting membership interest. Tribune and McClatchy are each allowed to designate one director to the Board. The affirmative vote of a majority of directors is required for Board action.

The Company declared and paid dividends of $50,000, $45,000, and $90,000 in August 2015, December 2014, and December 2013 respectively. The dividends were treated as a return on capital to Members based on the terms of the LLC agreement.

The Company also paid distributions of $1,233, $876 and $218 to redeemable noncontrolling interest holders in March 2015, March 2014 and March 2013, respectively.

22

CareerBuilder, LLC and Subsidiaries

Notes to Consolidated Financial Statements (continued)

(In Thousands)

14. Subsequent Events

The Company has evaluated subsequent events through March 7, 2016, which is the date the consolidated financial statements were available to be issued.

On March 1, 2016, the Company acquired Aurico Investigations, LLC and Aurico Reports, LLC (collectively “Aurico”)for approximately $52,500.  Aurico is a provider of background screening and drug testing serving U.S. andInternational customers.

23

EX-99.2

Exhibit 99.2

Classified Ventures, LLC

Consolidated Financial Statements

For the Period Ended October 1, 2014 and Twelve Months Ended December 31, 2013

Classified Ventures, LLC

Index

October 1, 2014 and December 31, 2013

	Page(s)
Report of Independent Auditors	1-2
Financial Statements
Consolidated Balance Sheet	3
Consolidated Statements of Operations	4
Consolidated Statements of Cash Flows	5
Consolidated Statements of Changes in Members’ Equity	6
Notes to Consolidated Financial Statements	7-20

Independent Auditor's Report

To the Board of Directors and Members of

Classified Ventures, LLC

We have audited the accompanying consolidated financial statements of Classified Ventures, LLC and its subsidiaries, which comprise the consolidated statements of operations, of changes in members’ equity and of cash flows for the yearended December 31, 2013.

Management's Responsibility for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on the consolidated financial statements based on our audit.  We conducted our audit in accordance with auditing standards generally accepted in the United States of America.  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. 

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements.  The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error.  In making those risk assessments, we consider internal control relevant to the Company's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.  Accordingly, we express no such opinion.  An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.  We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and the cash flows of Classified Ventures, LLC’s and its subsidiaries’ for the year ended December 31, 2013in accordance with accounting principles generally accepted in the United States of America.

Emphasis of Matter

As discussed in Note 9 to the financial statements, the Company has entered into significant transactions with Investor Affiliates of Classified Ventures, LLC, all related parties.

Other Matter

The accompanying consolidated balance sheet of Classified Ventures LLC as of October 1, 2014, and the related consolidated statements of operations, cash flows and changes in members' equity for the period then ended are presented for purposes of complying with Rule 3-09 of SEC Regulation S-X; however, Rule 3-09 does not require the financial statements as of and for the period ended October 1, 2014 to be audited and they are, therefore, not covered by this report.

[PricewaterhouseCoopers LLP (signed)]

Chicago, IL

February 21, 2014

2

Classified Ventures, LLC

Consolidated Balance Sheets

As of October 1, 2014

(In thousands of dollars)	2014*
Assets
Current assets
Cash and cash equivalents	$	43,767
Marketable securities held in trust		748
Accounts receivable, net of allowance for doubtful accounts of $1,584		56,634
Affiliate Investor accounts receivable		11,459
Prepaid expenses & other current assets		40,083
Total current assets		152,691
Property and equipment, net of accumulated depreciation		17,399
Marketable securities held in trust, less current portion		6,508
Goodwill		12,428
Investment		7,002
Definite lived intangible assets		237
Total assets	$	196,265
Liabilities and Members' Equity
Current liabilities
Accounts payable	$	4,716
Accrued compensation and related costs		11,622
Accrued expenses & other current liabilities		43,219
Deferred revenue		708
Current portion deferred incentive plans		17,804
Total current liabilities		78,069
Deferred incentive plans, less current portion		32,614
Deferred rent		2,499
Total liabilities		113,182
Commitments and contingencies (Note 15)
Members' equity		83,083
Total liabilities and members' equity	$	196,265

* Not covered by report included herein

The accompanying notes are an integral part of these financial statements.

3

Classified Ventures, LLC

Consolidated Statements of Operations

Period Ended October 1, 2014 and Twelve Months Ended December 31, 2013

(In thousands of dollars)	2014*		2013
Operating revenue
Net revenue	$	280,283	$	335,119
Net revenue Affiliate Investor		69,732		83,085
Total net operating revenue	$	350,015	$	418,204
Operating expenses
Product support, technology and operations		86,374		106,550
Marketing and sales		155,945		186,274
General and administrative		68,299		40,265
Affiliate revenue share		13,104		17,774
Professional fees related to sale		19,942		—
Total operating expenses		343,664		350,863
Operating income		6,351		67,341
Other income
Interest income		14		—
Gain on investments		12		1,901
Income from continuing operations		6,377		69,242
Discontinued operations
Discontinued operations - Apartments		569,001		32,945
Discontinued operations - HomeGain		—		2,503
Income from discontinued operations		569,001		35,448
Net income	$	575,378	$	104,690

* Not covered by report included herein

The accompanying notes are an integral part of these financial statements.

4

Classified Ventures, LLC

Consolidated Statements of Cash Flows

Period Ended October 1, 2014 and Twelve Months Ended December 31, 2013

(In thousands of dollars)	2014*		2013
Cash flows from operating activities
Net income	$	575,378	$	104,690
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		7,398		9,260
Deferred compensation		38,165		8,136
Loss (gain) on disposition of property and equipment		(24)		375
Loss (gain) on trading securities related to deferred compensation		(5)		(1,912)
Gain on sale of HomeGain		—		(3,461)
Gain on sale of Apartments		(563,388)		—
Provision for accounts receivable		1,976		2,377
Investments		—		(183)
Change in operating assets and liabilities
Accounts receivable		(4,358)		(6,823)
Prepaid expenses and other current assets		(1,947)		(2,372)
Accounts payable		(697)		(1,498)
Accrued expenses and other current liabilities		13,645		9,423
Deferred revenue		(1,138)		49
Deferred rent		(1,181)		(260)
Purchase of trading securities related to deferred compensation plan		(436)		(58)
Net cash provided by operating activities		63,388		117,743
Cash flows from investing activities
Proceeds from the sale of property and equipment		45		21
Purchase of investment		(2,000)		—
Purchase of property and equipment		(6,625)		(10,678)
Fees associated with sale of HomeGain		—		(329)
Proceeds from sale of HomeGain		—		3,589
Fees associated with sale of Apartments		(7,093)		—
Proceeds from sale of Apartments		554,968		—
Net cash provided / (used) in investing activities		539,295		(7,397)
Cash flows from financing activities
Dividend paid to investors		(598,321)		(90,000)
Net cash used in financing activities		(598,321)		(90,000)
Net increase (decrease) in cash		4,362		20,346
Cash and cash equivalents
Beginning of period		39,405		19,059
End of period	$	43,767	$	39,405
Supplemental disclosure of noncash investing and financing activities
Purchases of property, plant and equipment in accrued liabilities and accounts payables at the end of the reporting period	$	125	$	2,422

* Not covered by report included herein

The accompanying notes are an integral part of these financial statements.

5

Classified Ventures, LLC

Consolidated Statements of Changes in Members’ Equity

Period Ended October 1, 2014 and Twelve Months Ended December 31, 2013

	Members' Equity
	Common Units						Treasury Units						Additional
	Class A			Class B			Class A			Class B			Paid-In		Accumulated
	Units	Amount		Units	Amount		Units	Amount		Units	Amount		Capital		Deficit		Total
Balance at December 31, 2012	184,873	$	1,848	1,579	$	16	(5,710)	$	—	(1,579)	$	(2,416)	$	231,960	$	(140,072)	$	91,336
Net Income																104,690		104,690
Dividends paid to investors														(90,000)				(90,000)
Balance at December 31, 2013	184,873	$	1,848	1,579	$	16	(5,710)	$	—	(1,579)	$	(2,416)	$	141,960	$	(35,382)	$	106,026
Net Income*																575,378		575,378
Dividends paid to investors*														(44,753)	$	(553,568)		(598,321)
Balance at October 1, 2014*	184,873	$	1,848	1,579	$	16	(5,710)	$	—	(1,579)	$	(2,416)	$	97,207	$	(13,572)	$	83,083

* Not covered by report included herein

The accompanying notes are an integral part of these financial statements.

6

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

1. Summary of Significant Accounting Policies

Basis of Presentation

Classified Ventures, LLC (the “Company”) is a strategic joint venture among five large media partners whose objectives are to collectively capitalize on revenue growth in the online classified categories of automotive, rentals and real estate. The strategic partners are Gannett Co., Inc., The McClatchy Company, Tribune Company, Graham Holdings (formerlyThe Washington Post Company) and A.H. Belo Corporation (the “Investors”).  As of and for the period ended October 1, 2014, the Company does not meet the significant subsidiary test for purposes of S-X 3-09 and as a result, the financial statements for that period is not covered by the audit report included herein.

The Company provides online services in classified advertising marketplaces that build upon the local capabilities and expertise of its affiliated network of approximately105newspapers and television stations (the “Affiliates”). Investor Affiliates are Affiliates that are owned by our Investors and Non-Investor Affiliates are Affiliates that are not owned by our Investors. In the automotive category, the Company has the nationally branded website, cars.com ™, (www.cars.com).  In the rentals category, the Company has the nationally branded website, apartments.com™, (www.apartments.com).  In the real estate category, the Company hadthe nationally branded website, HomeGain.com™, (www.homegain.com).

On February 4, 2013, the net assets of HomeGain, Inc., a wholly owned subsidiary of Classified Ventures, LLC, were sold to a third party for $4.0 million. This consisted of a $3.6 million cash payment at closing and a $0.4 million note payable that was paidby the buyer in 2014. As a result of the sale, the Company’s consolidated financial results contain onemonth of HomeGain, Inc.’s results in 2013.  These financial results are included in the financial statements as discontinued operations (see Note 8). In November 2013, the HomeGain, Inc. legal entity was dissolved.

On April 1, 2014, the net assets of Apartments.com, a division of Classified Ventures, LLC, were sold to a third party for $585.0 million. This consisted of a $555.7 million cash payment at closing and a $29.3 million escrow to be paid by the buyer in March 2015.  The sale included an agreement for the Company to provide shared services to Apartments.com until March 2015 which may be cancelled by the buyer at any point with appropriate thirty-day notice.  As a result of the sale, the Company’s consolidated financial results contain three months of Apartments.com results in 2014 and twelve months of results in 2013.  These financial results are included in the financial statements as discontinued operations (see Note 8).

In August 2014, Gannett Co., Inc. signed an agreement to acquire full ownership of the Company from the other investors.  On October 1, 2014, Gannett Co., Inc. completed the acquisition of the remaining 73% interest in Classified Ventures, LLC for $1.8 billion and subsequently renamed the Company to Cars.com, LLC.The Company’s consolidated financial results include nine months of results in 2014 and twelve months of results in 2013.  The 2014 results include an $18.8 million in investment banker fees and $1.1 million in attorney fees related to the sale.

Revenue Recognition

The primary source of revenue for the Company is the sale of online subscription advertising products for the automotive, rentals and real estate industry segments. Online advertising sales to Affiliates, auto dealers, property managers, real estate agents, brokers and private parties are recognized as the service is delivered.Revenue is recorded net of credits.

7

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

The Company also sells banner and sponsorship advertising on its websites, pursuant to fixed fee or transaction based contracts.The customers are billed for impressions delivered or click-throughs on their advertisements. An impression is the display of an advertisement to an end-user on the website and is a measure of volume. A click-through occurs when an end-user clicks on an impression. Revenue is recognized evenly over the contract term for fixed fee contracts where a minimum number of impressions or click-throughs is not guaranteed.  Revenue is recognized as the service is delivered for transaction based contracts. If the impressions or click-throughs delivered are less than the amount billed, the difference isrecorded as deferred revenue and recognized as earned.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.  Cash equivalents consist primarily of deposits in money market funds.

Marketable Securities Held in Trust

The Company’s marketable securities held in trust relate to the deferred compensation plan (see Note 13) and are classified as trading securities, with unrealized gains and losses included in the Company’s consolidated statements of operations.  The marketable securities held in trust were $7.3 million andas of October 1, 2014.

Property and Equipment

Property and equipment are stated at cost and depreciated on a straight-line basis over the estimated useful lives as follows:

Computer software and hardware	3-5 years
Furniture and fixtures	7 years
Leasehold improvements	shorter of lease term or estimated useful life

Normal repairs and maintenance are expensed as incurred. The costs and related accumulated depreciation of assets sold or disposed of are removed from the balance sheet and any resulting gain or loss is included in the consolidated statement of operations.

Equity Investments

Investments in 20% to 50% owned companies, in which the Company has the ability to exercise significant influence over operating and financial policies of the invested company, but does not control the entity, are accounted for using the equity method. Non-marketable equity investments are recorded using the cost method or the equity method of accounting, depending on the facts and circumstances of each investment. Non-marketable investments in preferred shares that that do not meet criteria of in-substance common stock are accounted for at cost. The Company’s non-marketable equity investments are classified within other long-term assets on the consolidated balance sheet.

8

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

Under current accounting guidance, the Company is exempt from estimating the annual fair value of the cost method investment if no impairment indicators are present because it meets all the following criteria: is a non-public entity, has total assets less than $100 million as of the financial reporting date and has no instrument that, in whole or in part, is accounted for as a derivative instrument.  The Company assesses annually if there are any identified events or changes in circumstances that may have a significant adverse effect on the fair value of the investment which may indicate impairment. See Note 7 for additional investment information.

Goodwill

Goodwill represents the excess of the total purchase price of acquisitions over the fair value of the acquired assets.Goodwill is not amortized, but is subject to an impairment review annually and whenever indicators of impairment exist. Starting in 2012, the option was available to the Company to use the qualitative assessment of impairment.The Company chose to test for goodwill impairment, at the reporting unit level, using the two-step process. The first step involves a comparison of the estimated fair value of each reporting unit with its carrying value. Fair value is estimated using discounted cash flows of the reporting unit based on planned growth rates, and estimates of discount rates and residual values. If the carrying value exceeds the fair value, the second step of the process is necessary. The second step measures the difference between the carrying value and implied fair value of goodwill. If the carrying value exceeds fair value, goodwill is considered impaired and is reduced to fair value.The Company has goodwill as a result of its past acquisitions.  See Note 5 for additional goodwill disclosures.

Valuation of Long-Lived Assets

The Company evaluates the carrying value of long-lived assets to be held or used whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The carrying value of a long-lived asset is considered impaired when the projected undiscounted cash flows are less than the carrying value. No impairment losses were incurred in the first nine months of 2014, and in the twelve months of 2013.  

Website and Product Development Costs

Website product development costs are capitalized based upon the nature of the costs incurred and the stage of the website’s development.

For software developed or obtained for internal use, the Company capitalizes costs based upon the nature of the costs incurred and the stage of software development. There were no internal-use software costs capitalized for the nine months ended October 1,2014 and the twelve months ended December 31,2013.

Advertising Expenses

The Company expenses all advertising costs as incurred.  Total advertising expense was $70.0 million and$87.6 million for the nine months ended October 1, 2014 and the twelve months endedDecember 31, 2013 respectively.

Income Taxes

As a limited liability company, the Company is generally not subject to income taxes.  Accordingly, no income taxes have been recognized by the Company.

9

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

Use of Estimates and Assumptions

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.Actual results could differ from those estimates.Estimates are used for, but are not limited to, the accounting for: allowance for uncollectible accounts receivable, useful lives of definite-lived assets, accrued expenses, valuation of goodwill, commitments and contingencies, among others.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of accounts receivable. To date, accounts receivable have primarily been derived from advertising fees billed to Affiliates, auto dealers, property managers, private parties, banner and sponsorship advertising clients and automobile manufacturers located in the United States. At October 1,  2014 net accounts receivable from total Affiliates was $11.4 million, which represented 17%  of the netaccounts receivable.At October 1, 2014 net accounts receivable from Investor Affiliates was$11.5 million, which represents 17% of the net accounts receivable. At October 1, 2014,net accounts receivable from Non-Investor Affiliates was less than $.01 million, which represents less than 1%of the net accounts receivable.

No Affiliate individually had accounts receivable greater than 10% of the consolidated total. The Company requires no collateral to support accounts receivable and maintains reserves for potential credit losses. Historically, such losses have been within management’s expectations. The Company maintains reserves based upon the expected collectability of accounts receivable and establishes specific reserves when appropriate. The Company also has potential credit risk concentration in the auto manufacturing and newspaper publishing sectors. Of the gross accounts receivable balance of $69.7 million as ofOctober 1, 2014 the auto manufacturing and newspaper publishing sectors represent 31% and 34%as of October 1, 2014.No individual customer had a significant accounts receivable or revenue concentration.

Changes in the allowance for doubtful accounts for nine months ended October 1, 2014 and twelve months ended December 31, 2013 are as follows:

	2014		2013
Balance at January 1	$	1,398	$	1,375
Charges to expenses		1,793		1,793
Write-offs, net of recoveries		(1,607)		(1,770)
Balance at Period End	$	1,584	$	1,398

Fair Value of Financial Instruments

The Company’s financial instruments include cash and cash equivalents, marketable securities, accounts receivable, accounts payable and accrued liabilities. Due to the short-term nature of these items, the carrying values are deemed to approximate fair value.

10

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

2. Recently Issued Pronouncements

In December 2013, the FASB issued Accounting Standards Update No. 2013-12, Definition of a Public Business Entity. This ASU defines public business entity. The definition of a public business entity will be used in considering the scope of new financial guidance and will identify whether the guidance does or does not apply to public business entities. The term public business entity will be used in Accounting Standards Updates issued in 2014. As of October 1, 2014 this guidance did not impact the Company’s consolidated financial statements.

In April 2014, the FASB issued Accounting Standards Update No. 2014-08,  ReportingDiscontinuedOperations and Disclosures of Disposals of Components of an Entity. The ASU requires expanded disclosures for discontinued operations. The amendments also change the definition of discontinued operations by limiting discontinued operations reporting to disposals of components of an entity that represent strategic shifts that have a major effect on an entity’s operations and financial results. This update will be effective for the Company for annual periods beginning after December 15, 2014. The updated guidance is not expected to have a material impact on the Company’s financial statements.

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers. The core principle of the new standard update is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The unit of account for revenue recognition under the new standard is a performance obligation to be accounted for separately if it is distinct. This update will be effective for the Company for annual periods beginning after December 15, 2016. The updated guidance is not expected to have a material impact on the Company’s financial statements.

In August 2014, the FASB issued Accounting Standards Update No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. The update provides enhanced guidance on management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. This update will be effective for the Company for annual periods ending after December 15, 2016. The updated guidance is not expected to have an impact on the Company’s financial statements.

In November 2014, the FASB issued Accounting Standards Update No. 2014-17, Business Combinations (Topic 805): Pushdown Accounting. The amendments provide an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. The update is effective on November 18, 2014. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. The Company has elected not to apply pushdown accounting on the most recent change-in-control event related to the acquisition of the Company by Gannett Co., Inc.

3. Operating Leases

The company is obligated as lessee under certain non-cancelable operating leases for office space, and is also obligated to pay insurance, maintenance and other executory costs associated with the leases. Rental expense during the nine months ended October 1,  2014 andthe twelve months ended December 31, 2013was approximately $5.3 million and$6.8million, respectively.

11

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

Future minimum operating lease payments atOctober 1, 2014are as follows:

2014 remainder	$	1,591
2015		6,721
2016		6,500
2017		5,609
2018		625
2019 and thereafter		374
Total	$	21,420

4. Property and Equipment

Property and equipment at October 1, 2014 consisted of the following:

Computer software and hardware	$	47,893
Furniture and equipment		5,654
Leasehold improvements		7,291
		60,838
Less accumulated depreciation		(43,439)
Total	$	17,399

Depreciation expense was $7.0 million and$8.7 million for the nine monthsended October 1, 2014,and the twelve months ended December 31,  2013 respectively.

5. Goodwill

As of October 1, 2014, the Company had $12.4 million of goodwill related to the Cars.com business.

Based on the October 2014 sale of the remaining 73% interest in the Company to Gannett Co., Inc. for $1.8 billion  management determined that the fair value of the Cars.comexceeded the carrying value significantly and accordingly, goodwill was not determined to be impaired. 

6. Definite Lived Intangible Assets

The Company has definite lived intangible assets from recent acquisitions which will be fully amortized by the year 2020.  The following table sets forth balance sheet information for intangible assets subject to amortization, excluding goodwill:

	Patent		Total
At October 1, 2014
Gross intangible assets	$	510	$	510
Accumulated amortization		(273)		(273)
Intangible assets, net	$	237	$	237

12

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

Amortization expense was less than $0.1 million and$0.1 millionfor the nine months ended October 1, 2014 and the twelve months ended December 31,2013 respectively. Based upon the current amount of intangibles subject to amortization, the estimated amortization expense for each of the succeeding five years is as follows: 2014 remainder: $0.01 million,2015: $0.05 million; 2016: $0.05 million; 2017: $0.05 million; 2018: $0.03 million.  The estimated useful lives range from 1- 10 years.

7. Business Investments

In November 2012, the Company invested $5.0 million for a 25% interest in RepairPal, Inc., an online marketplace offering consumers a price estimator for car repairs and an ability to research repair shop reviews, for preferred stock, initially convertible into an equal number of shares of common stock.Each share of preferred stock carries a number of votes equal to the number of shares of common stock, has substantive liquidation preference and is not actively traded.  

In March 2014, the Company invested an additional $2.0 million in RepairPal, Inc. increasing the total investment to $7.0 million.

The Company accounts for its investment in RepairPal under the cost method. While the Company believes it has the ability to exercise significant influence, it has determined that its investment was not substantially similar to common stock on the acquisition date because it has a substantive liquidation preference over common stock. This factor precludes the Company from accounting for the investment under the equity method. 

The aggregate carrying amount of the investments at October 1, 2014was$7.0 million.  The Company did not estimate the fair value of the investments because it did not identify any events or circumstances that may have had a significant adverse effect on the investments’ values. 

8. Discontinued Operations

On February 4, 2013, the net assets of HomeGain, Inc.were sold to a third party for $4.0 million. This consisted of a $3.6 million cash payment at closing and a $0.4 million note paid by the buyer in 2014. As a result of the sale, the Company consolidated financial results contain one month of HomeGain, Inc.’s results in 2013.In November 2013, the HomeGain, Inc. legal entity was dissolved.

Results of the HomeGaindiscontinued operations at October 1, 2014 and December 31, 2013 are summarized as follows (in thousands):

	2014		2013
Total net operating revenue		—	$	748
Total operating expenses		—		1,706
Gain on sale of HomeGain		—		3,461
Income from discontinued operations		—	$	2,503

There were no assets and liabilities of HomeGainheld for saleat October 1, 2014.

13

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

In April 2014, the net assets of Apartments.com, a wholly owned subsidiary of Classified Ventures, LLC, were sold to a third party for a purchase price of $585.0 million. This consisted of a $555.7 million immediate payment and a $29.3 escrow to be paid by the buyer in March 2015.  Subsequent to the sale, the Company has no significant involvement in the Apartments.com business other than a limited shared service agreement for the remainder of 2014. Under this agreement, the Company will provide legal, facilities, technology, office space and accounting to the buyer.As a result of the sale, the financial results for Apartments.com are included in discontinued operations.

Results of the Apartments discontinued operations at October 1, 2014 and December 31, 2013 are summarized as follows (in thousands):

	2014		2013
Net revenue	$	20,835	$	78,542
Net revenue Affiliate Investor		1,571		7,325
Total operating expenses		16,792		52,922
Gain on sale of Apartments.com		563,388		—
Income from discontinued operations	$	569,001	$	32,945

There were no assets and liabilities of Apartments held for sale at October 1, 2014.

9. Related Party Transactions

Net sales to Investor Affiliates totaled $69.7 million and$83.1 million for the nine months ended October 1, 2014 and the twelve months ended December 31, 2013 respectively. Revenue share to the Affiliates totaled $13.1 million and$17.8 million for the nine months ended October 1, 2014 and the twelve months ended December 31,2013  respectively.  Net accounts receivable from InvestorAffiliatestotaled$11.5 million as of October 1,  2014. 

Pursuant to Affiliate Agreements between the Company and each of its Affiliates, Affiliates are assigned a sales territory to sell the Company’s products on a wholesale/retail basis. The Affiliate

Agreements specify print and online promotion obligations of the Affiliate, bar the Affiliates from engaging in specified activities and identify performance obligations of the Company and the Affiliate. Each Investor owned Affiliate Agreement contains language requiring the Company to treat all similarly situated InvestorAffiliates equally.

The Company also has a shared service agreement with HomeFinder.com as a result of the spin-off that occurred in March 2009. Under the agreement, the Company provides legal, facilities, technology, office space, accounting, and human resource servicesto HomeFinder.com at cost without any markup on the services. Total shared service revenue recognized for nine months ended October 1, 2014 and twelve months ended December 31, 2013was $1.2 million and$1.7 million respectively,to offset the$1.1 million and$1.7 million of incurred expensesduring the respective periods.HomeFinder.com shared services revenue is included within the net revenue line item on the income statement.

14

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

10. Fair Value Measurements

The Company accounts for certain items using the fair market value method of accounting which establishes a fair value hierarchy for those items measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s assumptions (unobservable inputs).  The fair value hierarchy consists of the following three levels:

§ Level 1- Quoted prices in active markets that the Company has the ability to access for identical assets or liabilities;

§ Level 2 - Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuations in which all significant inputs are observable in the market; and

§ Level 3 - Valuations using significant inputs that are unobservable in the market and include the use of judgment by the Company's management about the assumptions market participants would use in pricing the asset or liability.

The Company's financial assets and liabilities that are carried at fair value on a recurring basis in the consolidated balance sheet include the Long Term Incentive Plan (“LTIP”)  assets and liabilities and marketable securities.

The following table presents the LTIP investments carried at fair value as of October 1, 2014, by category on the consolidated balance sheet in accordance with the valuation hierarchy defined above:

	Level1		Level2		Level3		Total
Mutual funds	$	6,280	$	—	$	—	$	6,280
Fixed income fund		—		907		—		907
	$	6,280	$	907	$	—	$	7,187

The following is a description of the Company's valuation methodologies for assets and liabilities measured at fair value.

Fair value for mutual funds is measured using quoted market prices at the reporting date multiplied by the quantity held.

The Company has an investment in a commingled fund for which quoted market prices are not available. The value of the investment represents the net asset value as provided by the trustee.Management performs its own pricing diligence by reviewing the net asset value and by obtaining audited financial statements from the trustee.

11. Retirement Plan

The Company has a 401(k) Retirement Savings Plan, which is qualified under Section 401(k) of the Internal Revenue Code and for which all full-time Company employees are eligible. Participants are eligible on the first day of the quarter following the date of hire after one month of service and are allowed to make tax-deferred contributions up to 100% of annual compensation, subject to limitations specified by the Internal Revenue Code. 

15

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

The Company match is 100% of the employee’s contribution up to 3% of the employee’s salary, and thereafter 50% of the employee’s contribution, until the employee’s contributions reach 5% of the employee’s salary. All employees are immediately fully vested.  For the nine months endedOctober 1, 2014, and the twelve months ended December 31,2013,  the Company expensed matching contributions in the amounts of $2.7 million and$3.0million respectively.

12. Class A Common Units and Members’ Equity

As ofOctober 1, 2014 and December 31,2013, there were 184.9 million authorized, issued and outstanding Class A common units and 1.6 million authorized and issued Class B common units, none of which were outstanding. Class A common units have voting rights of one vote per unit.

In September 2014and December 2013, the Company declared a dividend of $23.3 million and$90 million, respectively. These dividends  were treated as a return of capital to Investors given the overall accumulated deficit balance.There was a dividend paid in April 2014 from the sale of Apartments.com for $575 million.  This dividend was treated as a reduction in retained earnings to the extent these were available upon distribution and partially as a return on capital.

13. Long-Term Incentive Plan

In June 2001, the Company’s LTIP was established. The Company, at its discretion, may designate up to 60 key employees to participate in the LTIP and may make annual contributions to the participants’ account. The contributions are invested at the participant’s direction among investment options including mutual funds and money market funds. In the nine months ended October 1,2014 and the twelve months ended December 31, 2013,the Company contributed $0.6 million and$0.5 million and $2.4 million respectively. The total amount contributed by the Company is marked to market quarterly and any unrealized gains (losses) are recognized through the income statement.

The amounts contributed to participants’ accounts vest over a three-year period. One-third of the amount contributed in a plan year (and any increases or decreases in the account as a result of income, gains, losses or costs allocated to the account) vests and is payable on February 15th of each of the three succeeding plan years after the plan year in which the contribution was made.  Once a portion of an award vests, it is either deferred for one year or paid to the participant. This initial deferral election is made by the participant prior to the plan year for which the award was issued. One year following the vesting date, that same portion of the deferred award is either deferred for five years or paid to the participant.  This subsequent deferral election is made not later than December 31st of the plan year prior to the plan year for which the award was issued. If a participant is involuntarily terminated other than for cause as defined by the plan, the participant’s account becomes 100% vested and distributed.  If a participant resigns, the vested portion of the participant’s account is distributed and the unvested portion is forfeited. The forfeited funds are retained within the Trust and used to offset future contributions.  The amount of funds forfeited in the nine months endedOctober 1, 2014 and the twelve months ended December 31, 2013were $0.1 million and $0.1 million, respectively.

The Company applies accounting guidance for stock appreciation rights and other variable stock option or award plans for the cash awarded under this deferred compensation plan. Under this plan, deferred compensation expense was $0.6 million and$1.1 millionfor the nine months ended October 1, 2014 and the twelve months ended December 31, 2013, respectively. The deferred compensation liability was$6.9 millionat October 1, 2014.

16

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

14. Share Appreciation Rights Plan

Effective as of January 1, 2012, the Company established a Share Appreciation Rights (SAR) Plan. The Classified Ventures Share Appreciation Rights Plan is intended to motivate certain key employees of Classified Ventures, LLC to maximize their contributions to the long-term success of the Company and to encourage them to remain in the employ of the Company through awards of Share Appreciation Rights. The Compensation Committee of the Company, at its discretion, may designate key employees to participate in the plan. Eligible participants will receive a number of stock appreciation rights annually that entitle the employee to receive the appreciation in the fair market value of a share from the date of grant up to a specified date or dates plus an amount equal to the distributions per share.  Benefits paid under this plan will be made in cash, not common stock, at the end of the three-year vesting period from the original grant date. Expenses related to the Share Appreciation Rights Plan have been recorded in accordance with the accounting standards for share based payments. Due to the cash settlement at the end of the performance period, the awards are classified as a liability and are remeasured each reporting period at fair value.

Under the SARs  Plan, deferred compensation is based upon award of share appreciation rights, the value of which is related to the appreciation in the value of the common units of the Company.Awards granted in a given year vest to the participant over a three-year period and are settled in cash at the end of the three-year performance period. Inthe years 2014 and 2013,  the Company awarded 1.4 million and2.6 million of share appreciation rights, respectively,to participants employed by the Company with a base price of $5.84 and$4.48 per right, respectively.  The 2014 price was determined by considering the price obtained for the sale of Apartments.com and the sale of the remaining interest of the Company. The 2013 price was determined by the Company including the use of a third party valuation analysis which based the Company value on the combination of income and market approaches. Upon the settlement of vested rights, the participant receives a lump sum cash payment in an amount equal to (i) the value of a common unit as of the date of settlement less (ii) the grant price value of a common unit on the grant date,  plus dividend distributions per unit.  

In April 2014, as a result of the Apartments.com sale, the vesting of the rights was accelerated per a board of directors’ resolutionand they became immediately exercisable. The SARs settlement was made in April 2014 to active Apartments.com participants.

In July 2014, the Company’s board of directors passed a resolution that upon the sale of the Company, all unvested share appreciation rights would immediately vest on the date of sale.  On October 1, 2014, as a result of the sale of the Company to Gannett, Co., Inc., the vesting of the non-vested rights was accelerated and became immediately exercisable.  Future SARs settlements will be paid in January of the year following the initial three-year vesting period. 

17

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

Appreciation rights outstanding and exercisable as of October 1, 2014 and changes during the year ended were as follows:

			Weighted		Remaining
			Avg.		Avg.		Aggregate
	Rights /		Grant		Contract		Intrinsic
	Units		Price		Terms		Value
	(in thousands)		(per right)		(in years)		(in thousands)
Rights outstanding as of December 31, 2013		5,102	$	4.33
Granted		1,388		5.84
Exercised		(961)		4.32
Forfeited or terminated		(7)		4.48
Rights outstanding as of October 1, 2014		5,522	$	4.71		—	$	43,795
Rights exercisable as of October 1, 2014		5,522	$	4.71		—	$	43,795

The Company measures the cost associated with awards issued under the SARsPlan using a graded vesting intrinsic value method, which includes a price increase in market value and a dividend component.Under this method, the cost of services related to the SARsPlan reflects changes in the Company common unit price and the relative vesting period of the rights.

In 2014, $40.6 million of additional SARs expense, including a tax component, was recorded as a result of the acceleration of the vesting of stock appreciation rights due to the sale transactions.  Total SARs expense was $43.8 million and$5.3 million for thenine months endedOctober 1, 2014, andthe twelve months ended December 31, 2013, respectively.  No SARsPlan expense was capitalized as part of an asset.Deferred compensation liability related to the SARsPlan was$44.4 million at October 1, 2014. 

The following table summarizes the aggregate intrinsic value, which includes a dividend component, related to vested rights as of October 1, 2014:

			Increase
			in		Aggregate
	Rights /		Intrinsic		Intrinsic
	Units		Value		Value
	(in thousands)		(per right)		(in thousands)
Exercised rights		961		3.94	$	3,787
Vested rights outstanding		5,522	$	7.93	$	43,795

Total unrecognized compensation cost related to nonvested rights, which includes a dividend component, is estimated to be zero and$4.5 millionatOctober 1, 2014, andDecember 31, 2013, respectively.  All remaining costswere recognized in 2014.  Future SARs cash settlements totaling $44.4 million, including tax expense incurred by the Company, are as follows:  2015: $19.0 million; 2016: $16.3 million; 2017: $9.1 million.

18

Classified Ventures, LLC

Notes to Consolidated Financial Statements

October 1, 2014 and December 31, 2013(Amounts as of and for the period ended October 1, 2014 are not covered by the report included herein)

15. Commitments and Contingencies

The Company engages a number of vendors for various goods and services.  At the time of this report, the Company is currently in process of assessing possible additional licensing costs from a software vendor related to past periods.  Management believes that additional costs are reasonably possible to be incurred based on the final outcome of the future audits and related negotiations with the software vendor.

16. Subsequent Events

For purposes of the October 1, 2104 financial statements, the Company assessed events occurring subsequent to October 1, 2014 and through January 8, 2015, for potential recognition and disclosure in such consolidated financial statements.

For purposes of the 2013 financial statements, the Company assessed subsequent events through February 21, 2014, for potential recognition and disclosure in such consolidated financial statements.

19

XML

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 27, 2015	Feb. 29, 2016	Jun. 28, 2015
Entity Registrant Name	MCCLATCHY CO
Entity Central Index Key	0001056087
Document Type	10-K
Document Period End Date	Dec. 27, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-27
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 86.6
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	FY
Common Class A
Entity Common Stock, Shares Outstanding		54,507,190
Common Class B
Entity Common Stock, Shares Outstanding		24,431,962

XML

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
REVENUES - NET:
Advertising	$ 637,415	$ 731,783	$ 822,128
Audience	367,858	366,592	346,311
Other	51,301	48,177	46,409
Revenues, total	1,056,574	1,146,552	1,214,848
OPERATING EXPENSES:
Compensation	395,449	411,881	422,981
Newsprint, supplements and printing expenses	95,674	114,801	120,551
Depreciation and amortization	101,595	113,638	121,570
Other operating expenses	404,347	415,682	411,621
Goodwill and other asset impairments (see Notes 1 and 4)	304,848	8,227	17,181
Operating expenses, total	1,301,913	1,064,229	1,093,904
OPERATING INCOME (LOSS)	(245,339)	82,323	120,944
NON-OPERATING (EXPENSE) INCOME:
Interest expense	(85,973)	(127,503)	(135,381)
Interest income	331	254	53
Equity income in unconsolidated companies, net	10,086	19,084	42,651
Gains related to equity investments	8,061	705,247
Gain (loss) on extinguishment of debt, net	1,167	(72,777)	(13,643)
Gain on sale of Miami property			12,938
Other - net	(292)	579	541
Non-operating (expense) income, total	(66,620)	524,884	(92,841)
Income (loss) from continuing operations before income taxes	(311,959)	607,207	28,103
Income tax provision (benefit)	(11,797)	231,230	11,659
INCOME (LOSS) FROM CONTINUING OPERATIONS	(300,162)	375,977	16,444
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAXES		(1,988)	2,359
NET INCOME (LOSS)	$ (300,162)	$ 373,989	$ 18,803
Basic:
Income (loss) from continuing operations (in dollars per share)	$ (3.47)	$ 4.33	$ 0.19
Loss from discontinued operations (in dollars per share)		(0.02)	0.03
Net income (loss) per share (in dollars per share)	(3.47)	4.31	0.22
Diluted:
Income (loss) from continuing operations - diluted (in dollars per share)	(3.47)	4.26	0.19
Loss from discontinued operations - diluted (in dollars per share)		(0.03)	0.03
Net income (loss) per share - diluted (in dollars per share)	$ (3.47)	$ 4.23	$ 0.22
Weighted average number of common shares used to calculate basic and diluted earnings per share:
Basic (in shares)	86,591	86,797	86,201
Diluted (in shares)	86,591	88,357	87,136

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Net Income (Loss)	$ (300,162)	$ 373,989	$ 18,803
Pension and post retirement plans:
Change in pension and post-retirement benefit plans, net of taxes of $2,936, $73,922 and $(117,853)	(4,404)	(110,883)	176,779
Investment in unconsolidated companies:
Other comprehensive income (loss), net of taxes of $534, $546, and $243	(801)	(819)	(364)
Other comprehensive income (loss)	(5,205)	(111,702)	176,415
Comprehensive income (loss)	$ (305,367)	$ 262,287	$ 195,218

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Unamortized net loss and other components of benefit plans, taxes	$ 2,936	$ 73,922	$ (117,853)
Other comprehensive loss, taxes	$ 534	$ 546	$ 243

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 27, 2015	Dec. 28, 2014
Current assets:
Cash and cash equivalents	$ 9,332	$ 220,861
Trade receivables (net of allowances of $4,451 in 2015 and $5,900 in 2014)	138,153	144,565
Other receivables	16,367	36,780
Newsprint, ink and other inventories	16,659	19,491
Assets held for sale	5,357	173
Other current assets	19,194	14,945
Total current assets	205,062	436,815
Property, plant and equipment, net	364,219	404,238
Intangible assets:
Identifiable intangibles - net	348,651	410,915
Goodwill	705,174	996,115
Total intangible assets	1,053,825	1,407,030
Investments and other assets:
Investments in unconsolidated companies	233,538	230,473
Deferred income taxes	1,312
Other assets	65,078	62,160
Total investments and other assets	299,928	292,633
TOTAL ASSETS	1,923,034	2,540,716
Current liabilities:
Accounts payable	41,751	49,095
Accrued pension liabilities	8,450	8,529
Accrued compensation	29,410	32,912
Income taxes payable	687	186,805
Unearned revenue	60,811	62,035
Accrued interest	9,423	10,592
Other accrued liabilities	15,195	14,957
Total current liabilities	165,727	364,925
Non-current liabilities :
Long-term debt	905,425	994,812
Deferred income taxes		25,108
Pension and postretirement obligations	581,852	574,024
Financing obligations	32,398	34,551
Other long-term obligations	44,869	43,911
Total non-current liabilities	$ 1,564,544	$ 1,672,406
Commitments and contingencies
Stockholders' equity:
Additional paid-in capital	$ 2,219,481	$ 2,222,675
Accumulated deficit	(1,603,546)	(1,303,384)
Treasury stock at cost, 1,652,165 shares in 2015 and 45,374 shares in 2014	(2,196)	(175)
Accumulated other comprehensive loss	(421,808)	(416,603)
Total stockholders' equity	192,763	503,385
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	1,923,034	2,540,716
Common Class A
Stockholders' equity:
Common stock	588	626
Common Class B
Stockholders' equity:
Common stock	$ 244	$ 246

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 27, 2015	Dec. 28, 2014
Trade receivables, allowance	$ 4,451	$ 5,900
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Treasury stock, shares	1,652,165	45,374
Common Class A
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	58,782,535	62,600,676
Common Class B
Common stock, shares authorized	60,000,000	60,000,000
Common stock, shares issued	24,431,962	24,585,962

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)	$ (300,162)	$ 373,989	$ 18,803
Less income (loss) from discontinued operations, net of tax		(1,988)	2,359
Income (loss) from continuing operations	(300,162)	375,977	16,444
Reconciliation to net cash provided by (used in) operating activities:
Depreciation and amortization	101,595	113,638	121,570
(Gains) loss on disposal of equipment (excluding asset impairments)	347	(918)	(1,914)
Contribution to qualified defined benefit pension plan		(25,000)	(7,600)
Retirement benefit expense	9,971	4,632	12,162
Stock-based compensation expense	3,178	3,479	3,481
Deferred income taxes	(23,087)	(32,233)	(9,774)
Equity income in unconsolidated companies	(10,086)	(19,084)	(42,651)
Gains related to equity investments	(8,061)	(705,247)
Distributions of income from equity investments	7,500	160,707	39,504
(Gain) loss on extinguishment of debt, net	(1,167)	72,777	13,643
Gain on disposal of Miami property			(12,938)
Goodwill and other asset impairments	304,848	8,227	17,181
Other	(5,501)	(4,137)	(3,865)
Changes in certain assets and liabilities:
Trade receivables	6,412	19,390	9,877
Inventories	2,832	3,822	3,534
Other assets	(7,707)	(111)	(391)
Accounts payable	(7,344)	(1,870)	1,085
Accrued compensation	(3,529)	(6,291)	(57)
Income taxes	(190,581)	186,208	3,745
Accrued interest	(1,169)	(4,452)	(3,631)
Other liabilities	(818)	(6,333)	(5,824)
Net cash provided by (used in) continuing operations	(122,529)	143,181	153,581
Net cash provided by (used in) discontinued operations		(37)	2,459
Net cash provided by (used in) operating activities	(122,529)	143,144	156,040
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment	(18,605)	(23,441)	(33,273)
Proceeds from sale of property, plant and equipment and other	414	10,301	4,703
Purchase of certificates of deposit		(33,483)
Proceeds from redemption of certificates of deposit			2,210
Purchase of insurance-related deposits		(6,770)
Proceeds from return of insurance-related deposit			6,400
Distributions from equity investments	7,428	1,621	2,932
Contributions to equity investments	(1,583)	(4,158)	(1,319)
Proceeds from sale of equity investments	26,186	607,942
Other-net			(1,500)
Net cash provided by (used in) continuing operations	13,840	552,012	(19,847)
Net cash provided by (used in) discontinued operations		32,953	(200)
Net cash provided by (used in) investing activities	13,840	584,965	(20,047)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase of public notes and related expenses	(92,254)	(584,366)	(165,549)
Purchase of treasury shares	(8,434)	(7,603)	(1,793)
Other	(2,152)	3,910	(928)
Net cash used in financing activities	(102,840)	(588,059)	(168,270)
Increase (decrease) in cash and cash equivalents	(211,529)	140,050	(32,277)
Cash and cash equivalents at beginning of period	220,861	80,811	113,088
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$ 9,332	$ 220,861	$ 80,811

XML

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Class A Common Stock [Member]	Common Class B Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Treasury Stock [Member]	Total
Stockholders' Equity Attributable to Parent, Beginning Balance at Dec. 30, 2012	$ 611	$ 248	$ 2,219,163	$ (1,696,176)	$ (481,316)	$ (29)	$ 42,501
Changes in accumulated other comprehensive loss
Net Income (Loss)				18,803			18,803
Other comprehensive income					176,415		176,415
Issuance of shares	10		927				937
Stock compensation expense			3,523				3,523
Treasury stock, acquired						(1,793)	(1,793)
Treasury stock, retired	(6)		(1,779)			1,785
Stockholders' Equity Attributable to Parent, Ending Balance at Dec. 29, 2013	615	248	2,221,834	(1,677,373)	(304,901)	(37)	240,386
Changes in accumulated other comprehensive loss
Net Income (Loss)				373,989			373,989
Other comprehensive income					(111,702)		(111,702)
Issuance of shares	24		4,784				4,808
Conversion of shares	2	(2)
Stock compensation expense			3,507				3,507
Treasury stock, acquired						(7,603)	(7,603)
Treasury stock, retired	(15)		(7,450)			7,465
Stockholders' Equity Attributable to Parent, Ending Balance at Dec. 28, 2014	626	246	2,222,675	(1,303,384)	(416,603)	(175)	503,385
Changes in accumulated other comprehensive loss
Net Income (Loss)				(300,162)			(300,162)
Other comprehensive income					(5,205)		(5,205)
Issuance of shares	9		(8)				1
Conversion of shares	2	(2)
Stock compensation expense			3,178				3,178
Treasury stock, acquired						(8,434)	(8,434)
Treasury stock, retired	(49)		(6,364)			6,413
Stockholders' Equity Attributable to Parent, Ending Balance at Dec. 27, 2015	$ 588	$ 244	$ 2,219,481	$ (1,603,546)	$ (421,808)	$ (2,196)	$ 192,763

XML

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - shares	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Treasury Stock, Shares, Acquired	6,494,482	1,594,115	580,219
Treasury Stock, Shares, Retired	4,887,691	1,559,948	575,046
Common Class A
Stock Issued During Period, Shares, Employee Stock Purchase Plans	915,550	2,391,100	1,030,750
Stock Issued During Period, Shares, Conversion of Convertible Securities	154,000	215,000

XML

SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 27, 2015

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

1.  SIGNIFICANT ACCOUNTING POLICIES

The McClatchy Company (the “Company,” “we,” “us” or “our”) is a 21st century news and information publisher of publications such as the Miami Herald, The Kansas City Star, The Sacramento Bee, The Charlotte Observer,  The (Raleigh) News and Observer, and the (Fort Worth) Star-Telegram. We operate 29 media companies in 28 U.S. markets in 14 states, providing each of our communities with high-quality news and advertising services in a wide array of digital and print formats. We are headquartered in Sacramento, California, and our Class A Common Stock is listed on the New York Stock Exchange under the symbol MNI.

We also own 15.0% of CareerBuilder, LLC, which operates the nation’s largest online job website, CareerBuilder.com; 33.3% of HomeFinder, LLC, which operates the online real estate website HomeFinder.com; as well as certain other digital company investments. See Note 3 for additional discussion.

Our fiscal year ends on the last Sunday in December. The years ended December 27, 2015, December 28, 2014, and December 29, 2013, consist of 52-week periods.

Preparation of the financial statements in conformity with accounting principles generally accepted in the United States and pursuant to the rules and regulation of the Securities and Exchange Commission requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. The consolidated financial statements include the Company and our subsidiaries. Intercompany items and transactions are eliminated. For purposes of presentation only, we updated the term “circulation” to “audience” as it relates to our discussion of revenues. The term “circulation” was used in prior filings with the Securities and Exchange Commission and no other changes were made in conjunction with this language change.

Changes in basis of presentation

As discussed more fully in Recently Adopted Accounting Pronouncements below, we elected to early adopt authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) related to the presentation of deferred income taxes and debt issuance costs. As required by this guidance, we have recast our consolidated balance sheet as of December 28, 2014, and certain related footnotes, to conform to the presentation as of December 27, 2015.

Revenue recognition

We recognize revenues (i) from advertising placed in a newspaper, a website and/or a mobile service over the advertising contract period or as services are delivered, as appropriate; (ii) from the sale of certain third party digital advertising products and services on a net basis, with wholesale fees reported as a reduction of the associated revenues; and (iii) for audience subscriptions as newspapers and access to online sites are delivered over the applicable subscription term. Audience revenues are recorded net of direct delivery costs for contracts that are not on a “fee-for-service” arrangement. Audience revenues on our “fee-for-service” contracts are recorded on a gross basis and associated delivery costs are recorded as other operating expenses.

We enter into certain revenue transactions, primarily related to advertising contracts and circulation subscriptions that are considered multiple element arrangements (arrangements with more than one deliverable). As such we must: (i) determine whether and when each element has been delivered; (ii) determine fair value of each element using the selling price hierarchy of vendor‑specific objective evidence of fair value, third party evidence or best estimated selling price, as applicable and (iii) allocate the total price among the various elements based on the relative selling price method.

Other revenues are recognized when the related product or service has been delivered. Revenues are recorded net of estimated incentives, including special pricing agreements, promotions and other volume‑based incentives and net of sales tax collected from the customer. Revisions to these estimates are charged to revenues in the period in which the facts that give rise to the revision become known.

Concentrations of credit risks

Financial instruments, which potentially subject us to concentrations of credit risks, are principally cash and cash equivalents and trade accounts receivables. Cash and cash equivalents are placed with major financial institutions. As of December 27, 2015, substantially all of our cash and cash equivalents are in excess of the FDIC insured limits. We routinely assess the financial strength of significant customers and this assessment, combined with the large number and geographic diversity of our customers, limits our concentration of risk with respect to trade accounts receivable. We have not experienced any losses related to amounts in excess of FDIC limits.

Allowance for doubtful accounts

We maintain an allowance account for estimated losses resulting from the risk that our customers will not make required payments. At certain of our newspapers we establish our allowances based on collection experience, aging of our receivables and significant individual account credit risk. At the remaining newspapers we use the aging of accounts receivable, reserving for all accounts due 90 days or longer, to establish allowances for losses on accounts receivable; however, if we become aware that the financial condition of specific customers has deteriorated, additional allowances are provided.

We provide an allowance for doubtful accounts as follows:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Balance at beginning of year	$	5,900	$	6,040	$	5,920
Charged to costs and expenses		8,181		9,305		8,481
Amounts written off		(9,630)		(9,229)		(8,361)
Disposition of discontinued operations		—		(216)		—
Balance at end of year	$	4,451	$	5,900	$	6,040

Newsprint, ink and other inventories

Newsprint, ink and other inventories are stated at the lower of cost (based principally on the first‑in, first‑out method) or current market value. During 2014, we recorded a $2.0 million write‑down of non-newsprint inventory.

Property, plant and equipment

Property, plant and equipment (“PP&E”) are recorded at cost. Additions and substantial improvements, as well as interest expense incurred during construction, are capitalized. Capitalized interest was not material in 2015, 2014 or 2013. Expenditures for maintenance and repairs are charged to expense as incurred. When PP&E is sold or retired, the asset and related accumulated depreciation are removed from the accounts and the associated gain or loss is recognized.

Property, plant and equipment consisted of the following:

	December 27,		December 28,		Estimated
(in thousands)	2015		2014		Useful Lives
Land	$	85,721	$	89,083
Building and improvements		332,502		337,727	5	-	60	years
Equipment		648,206		691,289	2	-	25	years	(1)
Construction in process		7,090		2,696
		1,073,519		1,120,795
Less accumulated depreciation		(709,300)		(716,557)
Property, plant and equipment, net	$	364,219	$	404,238

⁽¹⁾ Presses are 9 - 25 years and other equipment is 2 - 15 years

We record depreciation using the straight‑line method over estimated useful lives. The useful lives are estimated at the time the assets are acquired and are based on historical experience with similar assets and anticipated technological changes. Our depreciation expense was $53.2 million, $60.7 million and $64.4 million in 2015, 2014 and 2013, respectively.

We review the carrying amount of long‑lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events that result in an impairment review include the decision to close a location or a significant decrease in the operating performance of the long‑lived asset. Long‑lived assets are considered impaired if the estimated undiscounted future cash flows of the asset or asset group are less than the carrying amount. For impaired assets, we recognize a loss equal to the difference between the carrying amount of the asset or asset group and its estimated fair value, which is recorded in operating expenses in the consolidated statements of operations. The estimated fair value of the asset or asset group is based on the discounted future cash flows of the asset or asset group. The asset group is defined as the lowest level for which identifiable cash flows are available.

During 2015 we incurred $10.3million in accelerated depreciation related to the production equipment associated with outsourcing our printing process at a few of our newspapers. During 2014 we incurred $13.5 million in accelerated depreciation (i) related to the production equipment associated with outsourcing our printing process at one of our newspapers and (ii) resulting from moving the printing operations for another newspaper to a newly purchased production facility.  

Assets held for sale

During 2015 we began to actively market for sale a parking lot at one of our newspapers and a parking structure at another newspaper. No impairment charges were incurred during 2015 as a result of placing these assets in assets held for sale during 2015.

Investments in unconsolidated companies

We use the equity method of accounting for our investments in, and earnings or losses of, companies that we do not control but over which we do exert significant influence. We consider whether the fair values of any of our equity method investments have declined below their carrying value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If we consider any decline to be other than temporary (based on various factors, including historical financial results and the overall health of the investee), then a write‑down would be recorded to estimated fair value. See Note 3 for discussion of investments in unconsolidated companies.

Segment reporting

Our primary business is the publication of newspapers and related digital site and direct marketing products. We have two operating segments that we aggregate into a single reportable segment because each has similar economic characteristics, products, customers and distribution methods. Our operating segments are based on how our chief executive officer, who is also our Chief Operating Decision Maker (“CODM”), makes decisions about allocating resources and assessing performance. The CODM is provided discrete financial information for the two operating segments. Each operating segment consists of a group of newspapers and, effective July 1, 2015, following the retirement of a segment manager, both operating segments report to the same segment manager. There was no change to our single reportable segment as a result of the changes to our operating segments. Effective July 1, 2015, one of our operating segments (“Western Segment”) consists of our newspaper operations in California, the Northwest, and the Midwest, while the other operating segment (“Eastern Segment”) consists primarily of newspaper operations in the Southeast and Florida.

Goodwill and intangible impairment

We test for impairment of goodwill annually, at year‑end, or whenever events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The required two‑step approach uses accounting judgments and estimates of future operating results. Changes in estimates or the application of alternative assumptions could produce significantly different results. Impairment testing is done at a reporting unit level. We perform this testing on operating segments, which are also considered our reporting units. An impairment loss generally is recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit. The fair value of our reporting units is determined using a combination of a discounted cash flow model and market based approaches. The estimates and judgments that most significantly affect the fair value calculation are assumptions related to revenue growth, newsprint prices, compensation levels, discount rate and private and public market trading multiples for newspaper assets for the market based approach. We consider current market capitalization, based upon the recent stock market prices, plus an estimated control premium in determining the reasonableness of the aggregate fair value of the reporting units. We determined an impairment charge of $290.9 million in 2015 was required. We determined that no impairment charge was required in 2014 or 2013. Also see Note 4.

Newspaper mastheads (newspaper titles and website domain names) are not subject to amortization and are tested for impairment annually, at year‑end, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of each newspaper masthead with its carrying amount. We use a relief from royalty approach which utilizes a discounted cash flow model, as discussed above, to determine the fair value of each newspaper masthead. We determined that an impairment charges of $13.9 million, $5.2 million and $5.3 million in 2015, 2014 and 2013, respectively, were required. Also see Note 4.

Long‑lived assets such as intangible assets (primarily advertiser and subscriber lists) are amortized and tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. The carrying amount of each asset group is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use of such asset group. We had no impairment of long‑lived assets subject to amortization during 2015, 2014 or 2013.

Stock‑based compensation

All stock‑based payments, including grants of stock appreciation rights, restricted stock units and common stock under equity incentive plans, are recognized in the financial statements based on their fair values. At December 27, 2015, we had two stock‑based compensation plans. See Note 10.

Income taxes

We account for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.

Current accounting standards in the United States prescribe a recognition threshold and measurement of a tax position taken or expected to be taken in an enterprise’s tax returns. We recognize accrued interest related to unrecognized tax benefits in interest expense. Accrued penalties are recognized as a component of income tax expense.

Fair value of financial instruments

We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

Level 1	—	Unadjusted quoted prices available in active markets for identical investments as of the reporting date.
Level 2	—	Observable inputs to the valuation methodology are other than Level 1 inputs and are either directly or indirectly observable as of the reporting date and fair value can be determined through the use of models or other valuation methodologies.
Level 3	—	Inputs to the valuation methodology are unobservable inputs in situations where there is little or no market activity for the asset or liability, and the reporting entity makes estimates and assumptions related to the pricing of the asset or liability including assumptions regarding risk.

Our policy is to recognize significant transfers between levels at the actual date of the event or circumstance that caused the transfer.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

Cash and cash equivalents, accounts receivable, other current assets, accounts payable and other current liabilities. As of December 27, 2015, and December 28, 2014, the carrying amount of these items approximates fair value because of the short maturity of these financial instruments.

Long‑term debt. The fair value of long‑term debt is determined using quoted market prices and other inputs that were derived from available market information including the current market activity of our publicly‑traded notes and bank debt, trends in investor demand and market values of comparable publicly‑traded debt. These are considered to be Level 2 inputs under the fair value measurements and disclosure guidance, and may not be representative of actual. At December 27, 2015, and December 28, 2014, the estimated fair value of long‑term debt was $729.8 million and $994.8 million, respectively. At December 27, 2015, and December 28, 2014, the carrying value of long‑term debt was $905.4 million and $1.0 billion, respectively.

Pension plan. As of December 27, 2015, and December 28, 2014, we had assets related to our qualified defined benefit pension plan measured at fair value. The required disclosures regarding such assets are presented in Note 7.

Certain assets are measured at fair value on a nonrecurring basis; that is, they are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). Our non‑financial assets measured at fair value on a nonrecurring basis in the accompanying consolidated balance sheet as of December 27, 2015, were assets held for sale, goodwill, intangible assets not subject to amortization and equity method investments. All of these were measured using Level 3 inputs. We utilize valuation techniques that seek to maximize the use of observable inputs and minimize the use of unobservable inputs. The significant unobservable inputs include our expected cash flows and discount rate that we estimate market participants would seek for bearing the risk associated with such assets.

Accumulated other comprehensive loss

We record changes in our net assets from non‑owner sources in our consolidated statements of stockholders’ equity. Such changes relate primarily to valuing our pension liabilities, net of tax effects.

Our accumulated other comprehensive loss (“AOCL”) and reclassifications from AOCL, net of tax, consisted of the following:

			Other
	Minimum		Comprehensive
	Pension and		Loss
	Post-		Related to
	Retirement		Equity
(in thousands)	Liability		Investments		Total
Balance at December 29, 2013	$	(296,669)	$	(8,232)	$	(304,901)
Other comprehensive income (loss) before reclassifications		—		(819)		(819)
Amounts reclassified from AOCL		(110,883)		—		(110,883)
Other comprehensive income (loss)		(110,883)		(819)		(111,702)
Balance at December 28, 2014	$	(407,552)	$	(9,051)	$	(416,603)
Other comprehensive income (loss) before reclassifications		—		(801)		(801)
Amounts reclassified from AOCL		(4,404)		—		(4,404)
Other comprehensive income (loss)		(4,404)		(801)		(5,205)
Balance at December 27, 2015	$	(411,956)	$	(9,852)	$	(421,808)

	Amount Reclassified from AOCL (in thousands)
	Year Ended		Year Ended
	December 27,		December 28,		Affected Line in the
AOCL Component	2015		2014		Consolidated Statements of Operations
Minimum pension and post-retirement liability	$	(7,340)	$	(184,805)	Compensation
		2,936		73,922	Provision (benefit) for income taxes
	$	(4,404)	$	(110,883)	Net of tax

Earnings per share (EPS)

Basic EPS excludes dilution from common stock equivalents and reflects income divided by the weighted average number of common shares outstanding for the period. Diluted EPS is based upon the weighted average number of outstanding shares of common stock and dilutive common stock equivalents in the period. Common stock equivalents arise from dilutive stock options, restricted stock units and restricted stock and are computed using the treasury stock method. The weighted average anti‑dilutive stock options that could potentially dilute basic EPS in the future, but were not included in the weighted average share calculation consisted of the following:

	Years Ended
	December 27,	December 28,	December 29,
(shares in thousands)	2015	2014	2013
Anti-dilutive stock options	5,173	1,519	4,941

Recently Issued Accounting Pronouncements

In May 2014, the FASB issued Accounting Standards Update (“ASU”) ASU No. 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized. The new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. It is effective for us for annual and interim periods beginning on or after December 15, 2017, and early adoption is permitted for interim or annual reporting periods beginning after December 15, 2016. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

In August 2014, the FASB issued ASU No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” ASU 2014-15 requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnotes disclosures in certain circumstances. It is effective for us for annual and interim periods beginning on or after December 15, 2016, with early adoption permitted. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In February 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810); Amendments to the Consolidated Analysis,” which changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. It is effective for us for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-05, "Customer's Accounting for Fees Paid in a Cloud Computing Arrangement." ASU 2015-05 provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance does not change the accounting for service contracts. It is effective for us for interim and annual reporting periods beginning after December 15, 2015. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” ASU 2015-11 simplifies the measurement of inventory by requiring certain inventory to be measured at the “lower of cost and net realizable value” and options that currently exist for “market value” will be eliminated. The ASU defines net realizable value as the “estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.” It is effective for us for interim and annual reporting periods beginning after December 15, 2016. The standard should be applied prospectively with early adoption permitted. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” ASU 2016-01 addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 is effective for us for interim and annual reporting periods beginning after December 15, 2017. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, “Leases” (Accounting Standards Codification 842 (“ASC 842”)) and it replaces the existing guidance in ASC 840, “Leases.”  ASC 842 requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. The new lease standard does not substantially change lessor accounting. It is effective for us for interim and annual reporting periods beginning after December 15, 2018,with early adoption permitted. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

Recently Adopted Accounting Pronouncements

In April 2014, the FASB issued ASU No. 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which raised the threshold for a disposal to qualify as a discontinued operation and required new disclosures of both discontinued operations and certain other disposals that did not meet the definition of a discontinued operation. This guidance was effective for us at the beginning of 2015.

In April 2015 the FASB issued ASU No. 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which amended existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability instead of deferred charges. It was effective for us for annual and interim periods beginning on or after December 15, 2015, however early adoption was permitted. In August 2015, the FASB issued ASU No. 2015-15, “Interest-Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of Credit Arrangements-Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting,” to clarify that an entity may elect to present debt issuance costs related to a line-of-credit arrangement as an asset, regardless of whether or not there are any outstanding borrowings on the line-of-credit arrangement. We early adopted these standards retrospectively and elected to present the debt issuance costs related to our line-of credit arrangement, combined with the other debt issuance costs on our term loan debt, as a reduction in long-term debt. As of December 28, 2014, we reclassified unamortized debt issuance costs of $12.1 million from other assets to a reduction in long-term debt on the consolidated balance sheet.

In April 2015 the FASB issued ASU No. 2015-04, "Compensation – Retirement Benefits: Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets," which provided practical expedient, which permitted a reporting entity with a fiscal year-end that does not coincide with a month-end, to measure defined benefit plan assets and obligations using the month-end that is closest to the entity’s fiscal year-end and apply that practical expedient consistently from year to year. It is effective for us for interim and annual reporting periods beginning after December 15, 2015, with early application permitted. We early adopted this standard and it did not have a material impact on our consolidated financial statements.

In November 2015 the FASB issued ASU No. 2015-17, "Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes," which simplifies the presentation of deferred income taxes by requiring deferred tax assets and liabilities to be classified as noncurrent on the balance sheet. It was effective for us for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We early adopted this standard retrospectively, and reclassified our current deferred income taxes to net them with noncurrent deferred income taxes for all periods presented. As of December 28, 2014, we reclassified deferred income taxes of $1.1 million from current assets to a reduction in deferred income taxes in noncurrent liabilities on the consolidated balance sheet.

XML

DIVESTITURE

12 Months Ended

Dec. 27, 2015

DIVESTITURE

DIVESTITURE

2.  DIVESTITURE

On May 5, 2014, we completed the sale of the outstanding capital stock of Anchorage Daily News, Inc. (“Anchorage”) to an assignee of Alaska Dispatch Publishing, LLC for $34.0 million in cash. In accordance with the FASB Accounting Standards Codification (“ASC”) 205-20, “Discontinued Operations,” the financial results of Anchorage have been reported as a discontinued operation in our consolidated financial statements for the periods presented.

The following table summarizes the financial information for the Anchorage’s operations for 2014 and 2013:

	Year Ended
	December 28,		December 29,
(in thousands)	2014		2013
Revenues	$	9,071	$	27,389
Loss from discontinued operations, before taxes	$	(203)	$	3,956
Income tax benefit		251		1,597
Loss from discontinued operations, net of tax, before loss on sale	$	(454)	$	2,359
Gain (loss) on sale of discontinued operations	$	5,391	$	—
Income tax provision		6,925		—
Loss on sale of discontinued operations, net of tax		(1,534)		—
Loss from discontinued operations, net of tax	$	(1,988)	$	2,359

XML

INVESTMENTS IN UNCONSOLIDATED COMPANIES

12 Months Ended

Dec. 27, 2015

INVESTMENTS IN UNCONSOLIDATED COMPANIES

INVESTMENTS IN UNCONSOLIDATED COMPANIES

3.  INVESTMENTS IN UNCONSOLIDATED COMPANIES

Our ownership interest and investment in unconsolidated companies consisted of the following:

(in thousands)	% Ownership	December 27,		December 28,
Company	Interest	2015		2014
CareerBuilder, LLC	15.0	$	230,170	$	226,965
Other	Various		3,368		3,508
		$	233,538	$	230,473

Classified Ventures, LLC

On April 1, 2014, Classified Ventures, LLC (“Classified Ventures”) sold its Apartments.com business for $585 million. Accordingly, during 2014, we recorded our share of the net gain of $144.2 million, before taxes, as gains related to equity investments in our consolidated statements of operations. On April 1, 2014, we received a cash distribution of $146.9 million from Classified Ventures, which is equal to our share of the net proceeds.

On October 1, 2014, we, along with Tribune Media Company, Graham Holdings Company and A. H. Belo Corporation (the “Selling Partners”) sold all of the Selling Partners’ ownership interests in Classified Ventures to TEGNA, Inc. (formerly Gannett Co., Inc.) for a price that valued Classified Ventures at $2.5 billion. We recorded gain on sale of our ownership interest in Classified Ventures of $559.3 million, before taxes, during the fourth quarter of 2014. Our portion of the cash proceeds, net of transaction costs, was $631.8 million. Pursuant to the sale agreement, $25.6 million of net proceeds was being held in escrow until October 1, 2015. On October 1, 2014, we received our portion of the net cash proceeds, less the escrow amount, of $606.2 million. Upon the closing of the transaction, we entered into a new, five-year affiliate agreement with Cars.com that will allow us to continue to sell Cars.com products and services exclusively in our local markets.

In the fourth quarter of 2015, we received the $25.6 million escrow balance from the escrow account.

During the first quarter of 2015, we received $0.6 million from Classified Ventures as a result of the final working capital adjustment from our sale of Classified Ventures in the fourth quarter of 2014. In addition, in April 2015, we received a final cash distribution of $7.5 million from Classified Ventures. Both of these transactions were recorded as gains related to equity investments during 2015, because the company has no continuing ownership interest in Classified Ventures (see above).

McClatchy-Tribune Information Services

On May 7, 2014, we transferred our partnership interest in McClatchy-Tribune Information Services (“MCT”) to TCA News Service, LLC (“TCA”) for cash and future newswire content. Concurrently, we entered into a contributor agreement with MCT pursuant to which we both continue to be a contributor of newswire content to MCT for an agreed upon rate and we will receive newswire content from MCT or its successor at no cost for approximately 10 years. We recognized a $3.1 million intangible asset in the consolidated balance sheets with respect to the value of the content we will receive from MCT at no cost under these agreements, and a $1.7 million gain on sale of the equity investment in gains related to equity investments in the consolidated statements of operations.

During 2015 and 2014, we recorded write‑downs of $8.2 million and $7.8 million, respectively, which reduced our equity income in unconsolidated companies, net, in the consolidated statements of operations. The write-down in 2015 was primarily related to CareerBuilder, LLC, which recorded a non-cash, goodwill impairment charge related to their international reporting unit in the fourth quarter of 2015. Our portion of that impairment charge was $7.5 million. The write-down in 2014 was primarily our interest in the Ponderay Newsprint Company.

We received dividends and other equity distributions from our investments in unconsolidated companies as follows:

	Years Ended
	December 27,		December 28,
(in thousands)	2015		2014
CareerBuilder, LLC	$	7,500	$	6,750
Other		7,460		155,576
	$	14,960	$	162,326

For 2015, the $15.0 million in total distributions from our equity investments included $7.5 million from CareerBuilder LLC, which represented a return on investment and was recorded as an operating activity, and the $7.5 million from Classified Ventures (see above) was considered a return of investment because there were no cumulative earnings from the investee and, therefore, was treated as an investing activity on our consolidated statements of cash flows.

For 2014, the $162.3 million in total distributions from our equity investments included $160.7million, which represented a return on investment, was shown as an operating activity, and the remaining $1.6million, which exceeded the cumulative earnings from an investee and was considered a return of investment and therefore was treated as an investing activity in our consolidated statements of cash flows.

We have a 27% general partnership interest in Ponderay Newsprint Company (“Ponderay”) and we purchased some of our newsprint supply from Ponderay during 2015, 2014 and 2013. Our investment in Ponderay is zero as a result of a write off in 2014 and accumulative losses exceeding our carrying value. No future income or losses from Ponderay will be recorded until our carrying value on our balance sheet is restored through future earnings by Ponderay.

We have a 49.5% ownership interest in The Seattle Times Company (“STC”). Our investment in STC is zero as a result of accumulative losses in previous years exceeding our carrying value. No future income or losses from STC will be recorded until our carrying value on our balance sheet is restored through future earnings by STC.

We also incurred expenses related to the purchase of products and services provided by these companies. We purchase newsprint from Ponderay and we incur wholesale fees from CareerBuilder, LLC for the uploading and hosting of online advertising on behalf of our newspapers’ advertisers. We record these expenses for CareerBuilder, LLC as a reduction to the associated digital classified advertising revenues and expenses related to Ponderay are recorded in operating expenses. The following table summarizes expenses incurred for products and services provided by unconsolidated companies:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
CareerBuilder, LLC	$	1,001	$	1,024	$	1,109
Ponderay (general partnership)		8,200		10,433		16,313

As of December 27, 2015, and December 28, 2014, we had approximately $1.0 million and $1.5 million, respectively, payable collectively to CareerBuilder, LLC and Ponderay.

The tables below present the summarized financial information, as provided to us by these investees, for our investments in unconsolidated companies on a combined basis:

	December 27,		December 28,
(in thousands)	2015		2014
Current assets	$	365,993	$	359,349
Noncurrent assets		540,629		577,837
Current liabilities		236,630		247,825
Noncurrent liabilities		228,209		180,764
Equity		441,783		508,597

	Year ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Net revenues	$	988,871	$	1,368,593	$	1,512,534
Gross profit		843,680		1,155,091		1,262,104
Operating income		38,561		146,809		231,952
Net income		39,143		151,519		247,441

XML

INTANGIBLE ASSETS AND GOODWILL

12 Months Ended

Dec. 27, 2015

INTANGIBLE ASSETS AND GOODWILL

INTANGIBLE ASSETS AND GOODWILL

4.  INTANGIBLE ASSETS AND GOODWILL

Changes in identifiable intangible assets and goodwill consisted of the following:

	December 28,		Acquired		Disposition		Impairment		Amortization		December 27,
(in thousands)	2014		Adjustment		Adjustment		Charges		Expense		2015
Intangible assets subject to amortization	$	833,254	$	—	$	—	$	—	$	—	$	833,254
Accumulated amortization		(615,378)		—		—		—		(48,357)		(663,735)
		217,876		—		—		—		(48,357)		169,519
Mastheads		193,039		—		—		(13,907)		—		179,132
Goodwill		996,115		—		—		(290,941)		—		705,174
Total	$	1,407,030	$	—	$	—	$	(304,848)	$	(48,357)	$	1,053,825

	December 29,		Acquired		Disposition		Impairment		Amortization		December 28,
(in thousands)	2013		Adjustment		Adjustment		Charges		Expense		2014
Intangible assets subject to amortization	$	835,461	$	3,100	$	(5,307)	$	—	$	—	$	833,254
Accumulated amortization		(567,737)		—		5,307		—		(52,948)		(615,378)
		267,724		3,100		—		—		(52,948)		217,876
Mastheads		198,242		—		—		(5,203)		—		193,039
Goodwill		1,013,002		—		(16,887)		—		—		996,115
Total	$	1,478,968	$	3,100	$	(16,887)	$	(5,203)	$	(52,948)	$	1,407,030

During the quarter ended June 28, 2015, we performed interim tests of impairment of goodwill and intangible newspaper mastheads due to the continuing challenging business conditions and the resulting weakness in our stock price. The fair values of our reporting units for goodwill impairment testing and individual newspaper mastheads were estimated using the present value of expected future cash flows, using estimates, judgments and assumptions (see Note 1) that we believe were appropriate in the circumstances. As a result, we recorded an impairment charge related to goodwill of $290.9 million and an intangible newspaper masthead impairment charge of $9.5 million in the quarter ended June 28, 2015, which were recorded in the goodwill and other asset impairments line item on our consolidated statements of operations. In addition, based on our annual impairment testing of goodwill and intangible newspaper mastheads at December 27, 2015, we recorded an additional $4.4 million in masthead impairments, which was recorded in the goodwill and other asset impairment line item on our consolidated statements of operations.

Based on our annual impairment testing of goodwill and intangible newspaper mastheads at December 28, 2014, we recorded $5.2 million in masthead impairments, which was recorded in the goodwill and other asset impairment line item on our consolidated statements of operations.

During 2014, we sold Anchorage, resulting in the removal of the applicable intangible assets subject to amortization, accumulated amortization and goodwill from our consolidated balance sheet. In addition, in 2014 we acquired an intangible asset related to an agreement we entered into with MCT under which we will receive MCT newswire content, at no cost, over approximately 10 years.

Accumulated changes in indefinite lived intangible assets and goodwill as of December 27, 2015, and December 28, 2014, consisted of the following:

	December 27, 2015						December 28, 2014
	Original Gross		Accumulated		Carrying		Original Gross		Accumulated		Carrying
(in thousands)	Amount		Impairment		Amount		Amount		Impairment		Amount
Mastheads	$	683,000	$	(503,868)	$	179,132	$	683,000	$	(489,961)	$	193,039
Goodwill		3,571,111		(2,865,937)		705,174		3,571,111		(2,574,996)		996,115
Total	$	4,254,111	$	(3,369,805)	$	884,306	$	4,254,111	$	(3,064,957)	$	1,189,154

Amortization expense was $48.4 million, $52.9 million and $57.2million in 2015, 2014 and 2013, respectively. The estimated amortization expense for the five succeeding fiscal years is as follows:

	Amortization
	Expense
Year	(in thousands)
2016	$	47,986
2017		48,907
2018		47,275
2019		23,769
2020		418

XML

LONG-TERM DEBT

12 Months Ended

Dec. 27, 2015

LONG-TERM DEBT

LONG-TERM DEBT

5.  LONG‑TERM DEBT

All of our long‑term debt is in fixed rate obligations. As of December 27, 2015, and December 28, 2014, our outstanding long‑term debt consisted of senior secured notes and unsecured notes. They are stated net of unamortized debt issuance costs and unamortized discounts, if applicable, totaling $31.9 million and $37.6 million as of December 27, 2015, and December 28, 2014, respectively. The unamortized discounts resulted from recording assumed liabilities at fair value during a 2006 acquisition.

The face values of the notes, as well as the carrying values are as follows:

	Face Value at		Carrying Value
	December 27,		December 27,		December 28,
(in thousands)	2015		2015		2014
Notes:
9.00% senior secured notes due in 2022	$	516,415	$	506,571	$	543,640
5.750% notes due in 2017		55,442		54,551		108,489
7.150% debentures due in 2027		89,188		84,469		84,076
6.875% debentures due in 2029		276,230		259,834		258,607
Long-term debt	$	937,275	$	905,425	$	994,812

Debt Repurchases and Extinguishment of Debt

During the year ended December 27, 2015, we repurchased a total of $95.2 million of notes through privately negotiated transactions, as follows:

(in thousands)	Face Value
9.00% senior secured notes due in 2022	$	39,370
5.750% notes due in 2017		55,857
Total notes repurchased	$	95,227

We recorded a gain on extinguishment of debt of $1.2 million in 2015, and we recorded a loss on extinguishment of debt of $72.8 million and $13.6 million in 2014 and 2013, respectively.

During 2015, we repurchased $95.2 million aggregate principal of outstanding notes in privately negotiated transactions. We repurchased these notes at either par or at a price lower than par value, which was partially offset by the write-off of historical discounts and unamortized issuance costs related to these notes, as applicable, which resulted in a net gain on extinguishment of debt of $1.2 million in 2015.

During 2014, we repurchased $494.2 million aggregate principal amount of various series of our outstanding notes. We repurchased these notes at a price higher than par value and wrote off historical discounts and unamortized issuance costs related to these notes, which resulted in a loss on extinguishment of debt of $72.8 million in 2014. During 2013, we redeemed or repurchased $155.9 million aggregate principal amount of various series of our outstanding notes. We redeemed or repurchased these notes at a price higher than par value, and wrote off historical discounts and unamortized issuance costs related to these notes, which resulted in a loss on extinguishment of debt of $13.6 million in 2013.

Credit Agreement

Our Third Amended and Restated Credit Agreement, dated as of December 18, 2012, and as amended on October 21, 2014, (“Credit Agreement”) is secured by a first-priority security interest in certain of our assets as described below. The Credit Agreement, among other things, provides for commitments of $65 million and a maturity date of December 18, 2019. On October 21, 2014, we entered into a Collateralized Issuance and Reimbursement Agreement (“LC Agreement”). Pursuant to the terms of the LC Agreement, we may request letters of credit be issued on our behalf in an aggregate face amount not to exceed $35.0 million. We are required to provide cash collateral equal to 101% of the aggregate undrawn stated amount of each outstanding letter of credit.

As of December 27, 2015, there were $33.0 million face amount of letters of credit outstanding under the LC Agreement and no amounts drawn under the Credit Agreement. The amounts of standby letters of credit declined to $31.0 million in January 2016.

Under the Credit Agreement, we may borrow at either the London Interbank Offered Rate plus a spread ranging from 275 basis points to 425 basis points, or at a base rate plus a spread ranging from 175 basis points to 325 basis points, in each case based upon our consolidated total leverage ratio. The Credit Agreement provides for a commitment fee payable on the unused revolving credit ranging from 50 basis points to 62.5 basis points, based upon our consolidated total leverage ratio.

Senior Secured Notes and Indenture

In December 2012, we issued 9.00% Senior Secured Notes due in 2022 (“9.00% Notes”). Substantially all of our subsidiaries guarantee the obligations under the 9.00% Notes and the Credit Agreement. We own 100% of each of the guarantor subsidiaries and we have no significant independent assets or operations separate from the subsidiaries that guarantee our 9.00% Notes and the Credit Agreement. The guarantees provided by the guarantor subsidiaries are full and unconditional and joint and several, and the subsidiaries, other than the subsidiary guarantors, are minor.

In addition, we have granted a security interest to the banks that are a party to the Credit Agreement and the trustee under the indenture governing the 9.00% Notes that includes, but is not limited to, intangible assets, inventory, receivables and certain minority investments as collateral for the debt. The security interest does not include any PP&E, leasehold interests and improvements with respect to such PP&E which would be reflected on our consolidated balance sheets or shares of stock and indebtedness of our subsidiaries.

Covenants under the Senior Debt Agreements

Under the Credit Agreement, we are required to comply with a maximum consolidated total leverage ratio measured on a quarterly basis. As of December 27, 2015, we are required to maintain a consolidated total leverage ratio of not more than 6.00 to 1.00. For purposes of the consolidated total leverage ratio, debt is largely defined as debt, net of cash on hand in excess of $20 million. As of December 27, 2015, we were in compliance with all financial debt covenants.

The Credit Agreement also prohibits the payment of a dividend if a payment would not be permitted under the indenture for the 9.00% Notes (discussed below). Dividends under the indenture for the 9.00% Notes are allowed if the consolidated leverage ratio (as defined in the indenture) is less than 5.25 to 1.00 and we have sufficient amounts under our restricted payments basket (as defined in the indenture).

The indenture for the 9.00% Notes and the Credit Agreement include a number of restrictive covenants that are applicable to us and our restricted subsidiaries. The covenants are subject to a number of important exceptions and qualifications set forth in those agreements. These covenants include, among other things, restrictions on our ability to incur additional debt; make investments and other restricted payments; pay dividends on capital stock or redeem or repurchase capital stock or certain of our outstanding notes or debentures prior to stated maturity; sell assets or enter into sale/leaseback transactions; create specified liens; create or permit restrictions on the ability of our restricted subsidiaries to pay dividends or make other distributions; engage in certain transactions with affiliates; and consolidate or merge with or into other companies or sell all or substantially all of the Company’s and our subsidiaries’ assets, taken as a whole.

Maturities

The following table presents the approximate annual maturities of outstanding long‑term debt as of December 27, 2015, based upon our required payments, for the next five years and thereafter:

	Payments
Year	(in thousands)
2016	$	—
2017		55,442
2018		—
2019		—
2020		—
Thereafter		881,833
Debt principal	$	937,275

XML

INCOME TAXES

12 Months Ended

Dec. 27, 2015

INCOME TAXES

INCOME TAXES

6.  INCOME TAXES

Income tax provision (benefit) consisted of:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Current:
Federal	$	13,317	$	233,247	$	16,100
State		(2,027)		30,216		5,108
Deferred:
Federal		(17,642)		(29,182)		(7,262)
State		(5,445)		(3,051)		(2,287)
Income tax provision (benefit)	$	(11,797)	$	231,230	$	11,659

The effective tax rate expense (benefit) and the statutory federal income tax rate are reconciled as follows:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Statutory rate	(35.0)	%	35.0	%	35.0	%
State taxes, net of federal benefit	(2.1)		3.0		12.3
Changes in estimates	0.1		—		—
Changes in unrecognized tax benefits	0.3		—		(6.0)
Settlements	—		(0.1)		(1.5)
Other	—		0.1		3.1
Goodwill impairment	32.5		—		—
Stock compensation	0.4		0.1		(1.4)
Effective tax rate	(3.8)	%	38.1	%	41.5	%

The components of deferred tax assets and liabilities consisted of the following:

	December 27,		December 28,
(in thousands)	2015		2014
Deferred tax assets:
Compensation benefits	$	233,101	$	248,585
State taxes		3,586		6,061
State loss carryovers		2,877		2,266
Other		3,765		4,508
Total deferred tax assets		243,329		261,420
Valuation allowance		(2,877)		(2,265)
Net deferred tax assets		240,452		259,155
Deferred tax liabilities:
Depreciation and amortization		160,752		195,616
Investments in unconsolidated subsidiaries		50,434		52,711
Debt discount		8,301		9,618
Deferred gain on debt		19,653		26,318
Total deferred tax liabilities		239,140		284,263
Net deferred tax (assets) liabilities	$	(1,312)	$	25,108

The valuation allowance relates to state net operating loss and capital loss carryovers, and increased by $0.6 million in 2015 and decreased by $1.5 million in 2014.

As of December 27, 2015, we have net operating loss carryforwards in various states totaling approximately $196.5 million. The net operating losses carryforwards expire in various years between 2024 and 2035 if not used.

As of December 27, 2015, we had approximately $18.1 million of long‑term liabilities relating to uncertain tax positions consisting of approximately $15.6 million in gross unrecognized tax benefits (primarily state tax positions before the offsetting effect of federal income tax) and $2.5 million in gross accrued interest and penalties. If recognized, approximately $8.1 million of the net unrecognized tax benefits would impact the effective tax rate, with the remainder impacting other accounts, primarily deferred taxes. It is reasonably possible that a reduction of up to $1.1 million of unrecognized tax benefits and related interest may occur within the next 12 months as a result of the expiration of statutes of limitations.

We record interest on unrecognized tax benefits as a component of interest expense, while penalties are recorded as part of income tax expense.  Related to the unrecognized tax benefits noted below, we recorded interest expense (benefit), of ($0.3) million, $0.1 million and ($0.7) million for 2015, 2014 and 2013, respectively.  We also recorded penalty expense (benefit) of $0.1 million and ($0.1) million during 2015 and 2014, respectively. During 2013, our recorded penalty expense was immaterial. Accrued interest and penalties at December 27, 2015, December 28, 2014, and December 29, 2013, were approximately $2.5 million, $2.7 million and $2.7 million, respectively.

A reconciliation of the beginning and ending amount of unrecognized tax benefits consists of the following:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Balance at beginning of fiscal year	$	13,046	$	12,889	$	8,649
Increases based on tax positions in prior year		4,433		1		7,631
Decreases based on tax positions in prior year		—		(363)		(935)
Increases based on tax positions in current year		1,435		1,357		1,386
Settlements		—		(49)		(259)
Lapse of statute of limitations		(3,293)		(789)		(3,583)
Balance at end of fiscal year	$	15,621	$	13,046	$	12,889

As of December 27, 2015, the following tax years and related taxing jurisdictions were open:

	Open	Years Under
Taxing Jurisdiction	Tax Year	Exam
Federal	2012-2015	2013
California	2011-2015	—
Other States	2006-2015	2011-2014

XML

EMPLOYEE BENEFITS

12 Months Ended

Dec. 27, 2015

EMPLOYEE BENEFITS

EMPLOYEE BENEFITS

7.  EMPLOYEE BENEFITS

We have a qualified defined benefit pension plan (“Pension Plan”) covering substantially all of our employees who began their employment prior to March 31, 2009. Effective March 31, 2009, the Pension Plan was frozen such that no new participants may enter the Pension Plan and no further benefits will accrue. However, years of service continue to count toward early retirement calculations and vesting of benefits previously earned.

We also have a limited number of supplemental retirement plans to provide key employees hired prior to March 31, 2009, with additional retirement benefits. These plans are funded on a pay‑as‑you‑go basis and the accrued pension obligation is largely included in other long‑term obligations. We paid $8.5 million, $8.5 million and $8.3 million in 2015, 2014 and 2013, respectively, for these plans. We also provide or subsidize certain life insurance benefits for employees.

The following tables provide reconciliations of the pension and post‑ retirement benefit plans’ benefit obligations, fair value of assets and funded status as of December 27, 2015, and December 28, 2014:

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Change in Benefit Obligation
Benefit obligation, beginning of year	$	2,051,907	$	1,849,321	$	10,602	$	12,586
Service cost		11,680		8,030		—		—
Interest cost		84,994		91,004		368		514
Plan participants’ contributions		—		—		35		267
Actuarial (gain)/loss		(101,952)		213,176		(87)		467
Gross benefits paid		(103,062)		(101,441)		(1,035)		(1,611)
Plan amendment		—		—		—		(1,621)
Administrative expenses		(12,247)		(8,183)		—		—
Benefit obligation, end of year	$	1,931,320	$	2,051,907	$	9,883	$	10,602

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Change in Plan Assets
Fair value of plan assets, beginning of year	$	1,478,686	$	1,432,695	$	—	$	—
Actual return on plan assets		(22,307)		122,133		—		—
Employer contribution		8,533		33,482		1,000		1,344
Plan participants’ contributions		—		—		35		267
Gross benefits paid		(103,062)		(101,441)		(1,035)		(1,611)
Administrative expenses		(12,247)		(8,183)		—		—
Fair value of plan assets, end of year	$	1,349,603	$	1,478,686	$	—	$	—

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Funded Status
Fair value of plan assets	$	1,349,603	$	1,478,686	$	—	$	—
Benefit obligations		(1,931,320)		(2,051,907)		(9,883)		(10,602)
Funded status and amount recognized, end of year	$	(581,717)	$	(573,221)	$	(9,883)	$	(10,602)

Amounts recognized in the consolidated balance sheets at December 27, 2015, and December 28, 2014, consists of:

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Current liability	$	(8,450)	$	(8,529)	$	(1,298)	$	(1,270)
Noncurrent liability		(573,267)		(564,692)		(8,585)		(9,332)
	$	(581,717)	$	(573,221)	$	(9,883)	$	(10,602)

Amounts recognized in accumulated other comprehensive income for the years ended December 27, 2015, and December 28, 2014, consist of:

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Net actuarial loss/(gain)	$	705,853	$	701,408	$	(8,568)	$	(9,385)
Prior service cost/(credit)		—		—		(10,690)		(12,768)
	$	705,853	$	701,408	$	(19,258)	$	(22,153)

The elements of retirement and post‑retirement costs are as follows:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Pension plans:
Service Cost	$	11,680	$	8,030	$	5,545
Interest Cost		84,994		91,004		84,596
Expected return on plan assets		(106,283)		(107,460)		(101,053)
Prior service cost amortization		—		12		14
Actuarial loss		22,194		16,009		25,557
Net pension expense		12,585		7,595		14,659
Net post-retirement benefit credit		(2,614)		(2,963)		(2,497)
Net retirement expenses	$	9,971	$	4,632	$	12,162

Our discount rate was determined by matching a portfolio of long‑term, non‑callable, high-quality bonds to the plans’ projected cash flows.

Weighted average assumptions used for valuing benefit obligations were:

	Pension Benefit				Post-retirement
	Obligations				Obligations
	2015		2014		2015		2014
Discount rate	4.71	%	4.24	%	4.21	%	3.69	%

Weighted average assumptions used in calculating expense:

	Pension Benefit Expense						Post-retirement Expense
	December 27,		December 28,		December 29,		December 27,		December 28,		December 29,
	2015		2014		2013		2015		2014		2013
Expected long-term return on plan assets	7.75	%	8.00	%	8.00	%	N/A		N/A		N/A
Discount rate	4.24	%	5.01	%	4.17	%	3.69	%	4.36	%	3.39	%

Contributions and Cash Flows

We did not have a required cash minimum contribution to the Pension Plan in 2015 and made no voluntary contributions. In 2014 and 2013, we contributed $25 million and $7.6 million, respectively, of cash to the Pension Plan.

In February 2016, we contributed certain of our real property appraised at $47.1 million to our Pension Plan and we entered into leases for the contributed properties. We expected our required pension contribution under the Employee Retirement Income Security Act to be approximately $2.0 million in 2016, and the contribution of real property will exceed our required pension contribution for 2016. The contribution and leaseback of these properties in 2016 will be treated as a financing transaction and, accordingly, we will continue to depreciate the carrying value of the properties in our financial statements. No gain or loss will be recognized on the contributions until the termination of the individual leases on those properties. At the time of our contribution, our pension obligation was reduced and a financing obligation will be recorded. The financing obligation will be reduced by a portion of the lease payments made to the Pension Plan each month. The balance of this obligation at December 27, 2015, was $32.4 million and relates to certain real properties that were contributed to the Pension Plan in 2011.

Expected benefit payments to retirees under our retirement and post‑retirement plans over the next 10 years are summarized below:

	Retirement		Post-retirement
(in thousands)	Plans (1)		Plans
2016	$	101,524	$	1,297
2017		104,592		1,198
2018		107,158		1,105
2019		112,402		1,026
2020		113,173		942
2021-2025		612,003		3,567
Total	$	1,150,852	$	9,135

⁽¹⁾ Largely to be paid from the qualified defined benefit pension plan

Pension Plan Assets

Our investment policies are designed to maximize Pension Plan returns within reasonable and prudent levels of risk, with an investment horizon of greater than 10 years so that interim investment returns and fluctuations are viewed with appropriate perspective. The policy also aims to maintain sufficient liquid assets to provide for the payment of retirement benefits and plan expenses, hence, small portions of the equity and debt investments are held in marketable mutual funds.

Our policy seeks to provide an appropriate level of diversification of assets, as reflected in its target allocations, as well as limits placed on concentrations of equities in specific sectors or industries. It uses a mix of active managers and passive index funds and a mix of separate accounts, mutual funds, common collective trusts and other investment vehicles.

Our assumed long‑term return on assets was developed using a weighted average return based upon the Pension Plan’s portfolio of assets and expected returns for each asset class, taking into account projected inflation, interest rates and market returns. The assumed return was also reviewed in light of historical and recent returns in total and by asset class.

As of December 27, 2015, and December 28, 2014, the target allocations for the Pension Plan assets were 61% equity securities, 33% debt securities and 6% real estate securities.

The table below summarizes the Pension Plan’s financial instruments that are carried at fair value on a recurring basis by the fair value hierarchy levels discussed above, as of the year ended December 27, 2015:

	2015
	Plan Assets
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents	$	844	$	—	$	—	$	844
Mutual funds		436,316		—		—		436,316
Corporate debt instruments		—		112		—		112
Common collective trusts		—		845,686		—		845,686
Real estate		—		—		50,360		50,360
Private equity funds		—		—		7,282		7,282
Total	$	437,160	$	845,798	$	57,642	$	1,340,600
Pending trades								9,003
							$	1,349,603

The table below summarizes changes in the fair value of the Pension Plan’s Level 3 investment assets held for the year ended December 27, 2015:

(in thousands)	Real Estate		Private Equity		Total
Beginning Balance, December 28, 2014	$	47,579	$	6,636	$	54,215
Purchases, issuances, sales, settlements		—		—		—
Realized gains (losses)		2,479		—		2,479
Transfer in or out of level 3		(3,936)		—		(3,936)
Unrealized gains (losses)		4,238		646		4,884
Ending Balance, December 27, 2015	$	50,360	$	7,282	$	57,642

The table below summarizes the Pension Plan’s financial instruments that are carried at fair value on a recurring basis by the fair value hierarchy levels discussed above, as of the year ended December 28, 2014:

	2014
	Plan Assets
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents	$	1,068	$	—	$	—	$	1,068
Mutual funds		485,488		—		—		485,488
Corporate debt instruments		—		106		—		106
Common collective trusts		—		937,809		—		937,809
Real estate		—		—		47,579		47,579
Private equity funds		—		—		6,636		6,636
Total	$	486,556	$	937,915	$	54,215	$	1,478,686

The table below summarizes changes in the fair value of the Pension Plan’s Level 3 investment assets held for the year ended December 28, 2014:

(in thousands)	Real Estate		Private Equity (1)		Total
Beginning Balance, December 29, 2013	$	52,265	$	7,167	$	59,432
Purchases, issuances, sales, settlements		(3,312)		—		(3,312)
Realized gains		3,973		(16,153)		(12,180)
Transfer in or out of level 3		(3,973)		(483)		(4,456)
Unrealized gains		(1,374)		16,105		14,731
Ending Balance, December 28, 2014	$	47,579	$	6,636	$	54,215

⁽¹⁾ The activity within the unrealized gains (losses) and the realized gains (losses) relates to closing out two funds within the private equity funds. There was no impact to the total asset value of the private equity funds as a result of these transactions.

Cash and cash equivalents.  The carrying value of these items approximates fair value.

Mutual funds.  These investments are publicly traded investments, which are valued using the Net Asset Value (NAV). The NAV of the mutual funds is a quoted price in an active market. The NAV is determined once a day after the closing of the exchange based upon the underlying assets in the fund, less the fund’s liabilities, expressed on a per‑share basis.

Corporate debt instruments.  The fair value of corporate debt instruments is based on yields currently available on comparable securities of issuers with similar credit ratings. When quoted prices are not available for identical or similar debt instruments, the fair value is based upon an industry valuation model, which maximizes observable inputs.

Common collective trusts.  These investments are valued based on the NAV of the underlying investments and are provided by the fund issuers. NAV for these funds represent the quoted price in a non‑market environment. There are no restrictions on participants’ ability to withdraw funds from the common collective trusts.

Real estate.  On January 13, 2011, we contributed Company‑owned real property from seven locations to our Pension Plan. The Pension Plan obtained independent appraisals of the property, and based on these appraisals, the Pension Plan recorded the contribution at fair value on January 13, 2011. The properties are leased by us for our newspaper operations. The properties are managed on behalf of the Pension Plan by an independent fiduciary, and the terms of the leases between us and the Pension Plan were negotiated with the fiduciary. The property was valued by independent appraisals conducted under the direction of the independent fiduciary. Certain properties have been sold by the Pension Plan and others may be sold by the Pension Plan in the future.

Private equity funds.  Private equity funds represent investments in limited partnerships, which invest in start‑up or other private companies. Fair value was estimated based on valuations of comparable public companies, recent sales of comparable private and public companies and discounted cash flow analysis of portfolio companies.

401(k) Plan

We have a deferred compensation plan (“401(k) plan”), which enables qualified employees to voluntarily defer compensation. The 401(k) plan includes a matching company contribution and a supplemental contribution that is tied to our performance. We suspended our matching contributions to the 401(k) plan in 2009 and as of December 27, 2015, we have not reinstated that benefit.

XML

CASH FLOW INFORMATION

12 Months Ended

Dec. 27, 2015

CASH FLOW INFORMATION

CASH FLOW INFORMATION

8.  CASH FLOW INFORMATION

Cash paid during the 2015, 2014 and 2013 for interest and income taxes were:

	Year Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Interest paid (net of amount capitalized)	$	80,514	$	121,375	$	127,257
Income taxes paid (net of refunds)		207,043		77,622		21,019

The income tax payments in 2015 were primarily related to the gain on the sale of Classified Venture, LLC (previously owned equity investment) in the fourth quarter 2014, offset by the net of tax losses on bonds repurchased in the fourth quarter of 2014.

Other non-cash investing activities from continuing operations, related to the recognition of an intangible asset during 2014, was $3.1million.

We had $0.5 million, $1.3 million and $0.2 million of non‑cash financing activities related to purchases of PP&E on credit as of the end of 2015, 2014 and 2013, respectively.

As of December 29, 2013, other non‑cash financing activities included the release of $238.1 million for the financing obligation related to the Miami property transaction because we no longer have a continuing involvement with the Miami property that was sold. As of December 29, 2013, other non‑cash investing activities included the release of $227.7 million from PP&E, which also relates to the conclusion of the Miami property transaction.

XML

COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 27, 2015

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

9.  COMMITMENTS AND CONTINGENCIES

We have certain other obligations for various contractual agreements that secure future rights to goods and services to be used in the normal course of operations. These include purchase commitments for printing outsource agreements, planned capital expenditures, lease commitments and self‑ insurance obligations.

The following table summarizes our minimum annual contractual obligations as of December 27, 2015:

	Payments Due By Period
(in thousands)	2016		2017		2018		2019		2020		Thereafter		Total
Purchase obligations (1)	$	19,364	$	10,035	$	6,669	$	5,829	$	5,031	$	23,581	$	70,509
Operating leases (2)
Lease obligations		11,467		10,146		8,819		7,122		5,219		24,735		67,508
Sublease income		(3,336)		(2,342)		(1,441)		(1,028)		(611)		(1,748)		(10,506)
Net lease obligation		8,131		7,804		7,378		6,094		4,608		22,987		57,002
Workers’ compensation obligations (3)		3,599		2,425		1,822		1,356		1,045		6,361		16,608
Total (4)	$	31,094	$	20,264	$	15,869	$	13,279	$	10,684	$	52,929	$	144,119

(1) Represents our purchase obligations primarily related to printing outsource agreements and capital expenditures for property, plant and equipment expiring at various dates through 2028.

(2) Represents minimum rental commitments under operating leases with non‑cancelable terms in excess of one year and sublease income from leased space. We rent certain facilities and equipment under operating leases expiring at various dates through 2028. Total rental expense, included in other operating expenses, from continuing operations amounted to $11.6 million, $12.5 million and $11.2 million in 2015, 2014 and 2013, respectively. Most of the leases provide that we pay taxes, maintenance, insurance and certain other operating expenses applicable to the leased premises in addition to the minimum monthly payments. Some of the operating leases have built in escalation clauses. We sublease office space to other companies under noncancellable agreements that expire at various dates through 2024. Sublease income from operating leases totaled $4.6 million, $2.2 million and $3.9 million in 2015, 2014 and 2013, respectively.

(3) Represents the expected insurance payments of undiscounted ultimate losses, net of estimated insurance recoveries of approximately $3.2 million, and was based on our historical payment patterns. We retain the risk for workers’ compensation resulting from uninsured deductibles per accident or occurrence that are subject to annual aggregate limits. Losses up to the deductible amounts are accrued based upon known claims incurred and an estimate of claims incurred but not reported. For the year ended December 27, 2015, we compiled our historical data pertaining to the self‑insurance experiences and actuarially developed the ultimate loss associated with our self‑insurance programs for workers’ compensation liability. We believe that the actuarial valuation provides the best estimate of the ultimate losses to be expected under these programs. The undiscounted ultimate losses of all our self‑insurance reserves related to our workers’ compensation liabilities, net of insurance recoveries at December 27, 2015, and December 28, 2014, were $16.6 million and $18.0 million, respectively. We discount the net amount above to present value using an approximate risk‑free rate over the average life of our insurance claims. For the years ended December 27, 2015, and December 28, 2014, the discount rate used was 1.8% and 2.0%, respectively. The present value of all self‑insurance reserves, net of estimated insurance recoveries, for our workers’ compensation liability recorded at December 27, 2015, and December 28, 2014, was $15.3 million and $17.5 million, respectively.

Legal Proceedings and other contingent claims

In December 2008, carriers of The Fresno Bee filed a purported class action lawsuit against us and The Fresno Bee in the Superior Court of the State of California in Fresno County captioned Becerra v. The McClatchy Company (“Fresno case”) alleging that the carriers were misclassified as independent contractors and seeking mileage reimbursement. In February 2009, a substantially similar lawsuit, Sawin v. The McClatchy Company, involving similar allegations was filed by carriers of The Sacramento Bee (“Sacramento case”) in the Superior Court of the State of California in Sacramento County. Both courts have certified the class in these cases.  The class consists of roughly 5,000 carriers in the Sacramento case and 3,500 carriers in the Fresno case. The plaintiffs in both cases are seeking unspecified restitution for mileage reimbursement. With respect to the Sacramento case, in September 2013, all wage and hour claims were dismissed and the only remaining claim is an equitable claim for mileage reimbursement under the California Civil Code.  In the Fresno case, in March 2014, all wage and hour claims were dismissed and the only remaining claim is an equitable claim for mileage reimbursement under the California Civil Code.

The court in the Sacramento case has trifurcated the trial into three separate phases: the first phase addressed independent contractor status, the second phase will address liability, if any, and the third phase will address restitution, if any. On September 22, 2014, the court in the Sacramento case issued a tentative decision following the first phase, finding that the carriers that contracted directly with The Sacramento Bee during the period from February 2005 to July 2009 were misclassified as independent contractors. We objected to the tentative decision but the court ultimately adopted it as final. The court has not yet established a date for the second and third phases of trial concerning whether The Sacramento Bee is liable to the carriers in the class for mileage reimbursement or owes any restitution. 

The court in the Fresno case has bifurcated the trial into two separate phases: the first phase addressed independent contractor status and liability for mileage reimbursement and the second phase will address restitution, if any. The first phase of the Fresno case began in the fourth quarter of 2014 and concluded in late March 2015. The parties are awaiting a ruling on the first phase.

We are defending these actions vigorously and expect that we will ultimately prevail. As a result, we have not established a reserve in connection with the cases. While we believe that a material impact on our consolidated financial position, results of operations or cash flows from these claims is unlikely, given the inherent uncertainty of litigation, a possibility exists that future adverse rulings or unfavorable developments could result in future charges that could have a material impact. We have and will continue to periodically reexamine our estimates of probable liabilities and any associated expenses and make appropriate adjustments to such estimates based on experience and developments in litigation.

Other than the cases described above, we are subject to a variety of legal proceedings (including libel, employment, wage and hour, independent contractor and other legal actions) and governmental proceedings (including environmental matters) that arise from time to time in the ordinary course of our business. We are unable to estimate the amount or range of reasonably possible losses for these matters. However, we currently believe, after reviewing such actions with counsel, that the expected outcome of pending actions will not have a material effect on our consolidated financial statements. No material amounts for any losses from litigation that may ultimately occur have been recorded in the consolidated financial statements as we believe that any such losses are not probable.

We have certain indemnification obligations related to the sale of assets including but not limited to insurance claims and multi‑employer pension plans of disposed newspaper operations. We believe the remaining obligations related to disposed assets will not be material to our financial position, results of operations or cash flows.

As of December 27, 2015, we had $33.0 million of standby letters of credit secured under the LC Agreement (see Note 5 for further discussion).

XML

COMMON STOCK AND STOCK PLANS

12 Months Ended

Dec. 27, 2015

COMMON STOCK AND STOCK PLANS

COMMON STOCK AND STOCK PLANS

10.  COMMON STOCK AND STOCK PLANS

Common Stock

We have two classes of stock; Class A and Class B Common Stock. Both classes of stock participate equally in dividends. Holders of Class B are entitled to one vote per share and to elect as a class 75% of the Board of Directors, rounded down to the nearest whole number. Holders of Class A Common Stock are entitled to one-tenth of a vote per share and to elect as a class 25% of the Board of Directors, rounded up to the nearest whole number.

Class B Common Stock is convertible at the option of the holder into Class A Common Stock on a share‑for‑share basis. During 2015, 154,000 Class B Common Shares were converted to Class A Common Shares at the request of a holder.

The holders of shares of Class B Common Stock are parties to an agreement, the intent of which is to preserve control of the Company by the McClatchy family. Under the terms of the agreement, the Class B shareholders have agreed to restrict the transfer of any shares of Class B Common Stock to one or more “Permitted Transferees,” subject to certain exceptions. A “Permitted Transferee” is any of our current holders of shares of Class B Common Stock; any lineal descendant of Charles K. McClatchy (1858 to 1936); or a trust for the exclusive benefit of, or in which all of the remainder beneficial interests are owned by, one or more lineal descendants of Charles K. McClatchy.

Generally, Class B shares can be converted into shares of Class A Common Stock and then transferred freely (unless, following conversion, the outstanding shares of Class B Common Stock would constitute less than 25% of the total number of all our outstanding shares of common stock). In the event that a Class B shareholder attempts to transfer any shares of Class B Common Stock in violation of the agreement, or upon the happening of certain other events enumerated in the agreement as “Option Events,” each of the remaining Class B shareholders has an option to purchase a percentage of the total number of shares of Class B Common Stock proposed to be transferred equal to such remaining Class B shareholder’s ownership percentage of the total number of outstanding shares of Class B Common Stock. If all the shares proposed to be transferred are not purchased by the remaining Class B shareholders, we have the option of purchasing the remaining shares. The agreement can be terminated by the vote of the holders of 80% of the outstanding shares of Class B Common Stock who are subject to the agreement. The agreement will terminate on September 17, 2047, unless terminated earlier in accordance with its terms.

In April 2015, our Board of Directors authorized a new share repurchase program for the repurchase of up to $7.0 million of our Class A Common Stock through December 31, 2016. This program was further amended in August 2015 to authorize a total of up to $15.0 million to repurchase shares. The shares are to be repurchased from time to time depending on prevailing market prices, availability, and market conditions, among other factors. As of December 27, 2015, we have repurchased approximately 6.1 million shares at a weighted average price of $1.28 per share, or $7.8 million of the total buyback approved.

Stock Plans

During 2015, we had two stock‑based compensation plans, which are described below.

We have a stock incentive plan (the “2004 Plan”) that reserved 9,000,000 Class A Common shares for issuance to key employees and outside directors. The options vested in installments over four years, and once vested are exercisable up to 10 years from the date of grant. In addition, the 2004 Plan permitted the following type of incentive awards in addition to common stock, stock options and stock appreciation rights (“SARs”): restricted stock, unrestricted stock, stock units and dividend equivalent rights. The 2004 Plan was frozen in May 2012.

In May 2012 the shareholders approved The McClatchy Company 2012 Omnibus Incentive Plan (“2012 Plan”) to replace the 2004 Plan, for all future awards. The 2012 Plan provided that the Class A Common Stock available for issuance equal to 5,000,000 shares plus the number of shares available for future awards under the 2004 Plan as of the date of May 16, 2012 (the shareholder meeting date) plus the number of shares subject to awards outstanding under the 2004 Plan as of May 16, 2012, which terminate by expiration, forfeiture, cancellation or otherwise without the issuance of such shares. The 2012 Plan generally provides for granting of stock options or SARs only at an exercise price at least equal to fair market value on the grant date; a 10-year maximum term for stock options and SARs; no repricing of stock options or SARs without prior shareholder approval; and no reload or “evergreen” share replenishment features.

Stock Plans Activity

In both 2015 and 2014, we granted 15,000 shares of Class A Common Stock to each non‑employee director, resulting in the issuance of 150,000 shares from the 2012 Plan in each year. In 2013, we granted 15,000 shares of Class A Common Stock to each non-employee director, resulting in the issuance of 165,000 shares from the 2012 Plan.

We granted restricted stock units (“RSUs”) at fair market value on the date of grant to certain key employees from the 2012 Plan as summarized below. The RSUs generally vest three years after grant date but terms of each grant are at the discretion of the compensation committee of the board of directors.

The following table summarizes the RSUs stock activity:

		Weighted
		Average Grant
		Date Fair
	RSUs	Value
Nonvested — December 30, 2012	1,102,000	$	2.98
Granted	483,150	$	2.46
Vested	(320,000)	$	4.08
Forfeited	(33,500)	$	2.48
Nonvested — December 29, 2013	1,231,650	$	2.50
Granted	856,950	$	4.61
Vested	(717,150)	$	2.92
Forfeited	(41,900)	$	2.93
Nonvested — December 28, 2014	1,329,550	$	3.62
Granted	1,365,300	$	2.28
Vested	(970,000)	$	2.85
Forfeited	(186,050)	$	3.08
Nonvested — December 27, 2015	1,538,800	$	2.98

As of December 27, 2015, the total fair value of the RSUs that vested during the period was $1.6 million. As of December 27, 2015, there were $3.0 million of unrecognized compensation costs for nonvested RSUs, which are expected to be recognized over 1.8 years.

When SARs are granted they are granted at fair market value on the date of grant to certain key employees from the 2012 Plan. The SARs generally vest four years after grant date but terms of each grant is at the discretion of the compensation committee of the board of directors.

Outstanding options and SARs are summarized as follows:

		Weighted		Aggregate
		Average		Intrinsic Value
	SARs	Exercise Price		(in thousands)
Outstanding December 30, 2012	6,194,500	$	11.45	$	1,846
Granted	775,000	$	2.46
Exercised	(545,750)	$	1.72	$	847
Forfeited	(58,500)	$	3.30
Expired	(254,750)	$	48.97
Outstanding December 29, 2013	6,110,500	$	9.69	$	2,384
Exercised	(1,678,250)	$	2.86	$	3,138
Forfeited	(67,250)	$	3.38
Expired	(516,250)	$	35.74
Outstanding December 28, 2014	3,848,750	$	9.28	$	1,542
Forfeited	(68,750)	$	2.61
Expired	(578,750)	$	20.76
Outstanding December 27, 2015	3,201,250	$	7.35	$	—
Vested and Expected to Vest December 27, 2015	3,179,366	$	8.09	$	—
Options exercisable:
December 29, 2013	3,983,875			$	1,306
December 28, 2014	2,719,750			$	716
December 27, 2015	2,774,125			$	—

As of December 27, 2015, there were $0.3 million of unrecognized compensation costs related to options and SARs granted under our plans. The cost is expected to be recognized over a weighted average period of 1.1 years.

The following tables summarize information about stock options and SARs outstanding in the stock plans at December 27, 2015:

		Average
		Remaining	Weighted			Weighted
Range of Exercise	Options/SARs	Contractual	Average		Options/SARs	Average
Prices	Outstanding	Life	Exercise Price		Exercisable	Exercise Price
$1.70 – $9.07	2,426,250	4.70	$	3.06	1,999,125	$	3.17
$9.73 – $35.94	574,000	1.91	$	13.17	574,000	$	13.17
$40.95 – $73.36	201,000	0.92	$	42.48	201,000	$	42.48
Total	3,201,250	3.96	$	7.35	2,774,125	$	8.09

The weighted average remaining contractual life of options exercisable at December 27, 2015, was 3.5 years. The weighted average remaining contractual life of options vested and expected to vest at December 27, 2015, was 3.5 years.

The fair value of the stock options and SARs granted in 2013 were estimated on the date of grant using a Black‑Scholes option valuation model that used the assumptions noted in the following table. The expected life of the options represents the period of time that options granted were expected to be outstanding using the historical exercise behavior of employees. The expected dividend yield was based on historical dividends declared per year, giving consideration for any anticipated change and the estimated stock price over the expected life of the options based on historical experience. Expected volatility was based on historical volatility for a period equal to the stock option’s expected life for shares granted. The risk‑free rate for periods within the contractual life of the option was based on the U.S. Treasury yield curve in effect at the time of grant. We did not grant any SARs in 2015 or 2014.

	2013
Expected life in years		4.51
Dividend yield		NIL
Volatility		1.08
Risk-free interest rate		0.76	%
Weighted average exercise price of options/SARs granted	$	2.46
Weighted average fair value of options/SARs granted	$	1.85

Stock‑Based Compensation

Total stock‑based compensation expense consisted of the following:

	Years Ended
	December 27,		December 29,		December 29,
(in thousands)	2015		2014		2013
Stock-based compensation expense	$	3,178	$	3,479	$	3,481

XML

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

12 Months Ended

Dec. 27, 2015

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

11.  QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

Our business is somewhat seasonal with peak revenues and profits generally occurring in the second and fourth quarters of each year as a result of increased advertising activity during the holiday seasons. The first and third quarters are historically the slowest quarters for revenues and profits. Our quarterly results are summarized as follows:

	Quarters Ended
(in thousands, except per share	March 29,		June 28,		September 27,		December 27,
amounts)	2015		2015		2015		2015
Net revenues	$	257,178	$	262,360	$	251,211	$	285,825
Operating income (loss)	$	(1,158)	$	(288,966)	$	8,389	$	36,396
Income (loss) from continuing operations	$	(11,346)	$	(296,497)	$	(1,149)	$	8,830
Income (loss) from discontinued operations		—		—		—		—
Net income (loss)	$	(11,346)	$	(296,497)	$	(1,149)	$	8,830
Income (loss) from continuing operations per share - diluted	$	(0.13)	$	(3.39)	$	(0.01)	$	0.10
Income (loss) from discontinued operations per share - diluted		—		—		—		—
Net income (loss) per share - diluted	$	(0.13)	$	(3.39)	$	(0.01)	$	0.10

	Quarters Ended
(in thousands, except per share	March 30,		June 29,		September 28,		December 28,
amounts)	2014		2014		2014		2014
Net revenues	$	276,171	$	287,391	$	272,899	$	310,091
Operating income	$	(4,698)	$	27,307	$	18,550	$	41,164
Income (loss) from continuing operations	$	(16,062)	$	91,648	$	(2,619)	$	303,010
Income from discontinued operations		220		(1,699)		(141)		(368)
Net income (loss)	$	(15,842)	$	89,949	$	(2,760)	$	302,642
Income (loss) from continuing operations per share - diluted	$	(0.18)	$	1.03	$	(0.03)	$	3.45
Income from discontinued operations per share - diluted		—		(0.01)		—		(0.01)
Net income (loss) per share - diluted	$	(0.18)	$	1.02	$	(0.03)	$	3.44

The following are significant activities in 2015:

· During the quarter ended June 28, 2015, we recognized a goodwill impairment charge of $290.9 million and masthead impairment charges of $9.5 million as described in Note 1 and Note 4.

· During the quarter ended December 27, 2015, we recognized masthead impairment charges of $4.4 million as described in Note 1 and Note 4.

The following are significant activities in 2014:

· During the quarter ended June 29, 2014, we recognized gains related to our sale of MCT for $1.7 million before taxes and from our portion of the sale of Apartments.com by Classified Ventures for $144.2 million before taxes as described in Note 3.

During the quarter ended December 28, 2014, we recognized a gain on the sale of our ownership interest in Classified Ventures for $559.3 million before taxes as described in Note 3, write-downs of certain equity investments for $7.8 million as described in Note 3, masthead impairment charges of $5.2 million as described in Note 1, and loss on extinguishment of debt of $72.8 million as described in Note 5.

XML

CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN

12 Months Ended

Dec. 27, 2015

CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN

CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN

12.  CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN

On February 11, 2016,  we contributed company-owned real property from sixlocations to ourPension Plan. The Pension Plan obtained independent appraisals of the property, and based on these appraisals, recorded the contribution (the fair value of the property) at $47.1 million on February 11, 2016.  

We have entered into leases for the contributed properties for 11 years at an aggregate annual rent of approximately $3.5 million and we expect to continue to use the properties in our newspaper operations at the six locations. The properties will be managed on behalf of the pension plan by an independent fiduciary, and the terms of the leases were negotiated with the fiduciary.

The contribution and leaseback of the properties are treated as a financing transaction and accordingly, we will continue to depreciate the carrying value of the properties in our financial statements and no gain or loss is recognized. The $47.1 million will be recorded in financing obligations and will be reduced by a portion of lease payments made to the pension plan. The transaction will be recorded in the quarter ended March 27, 2016 and therefore the funded status of our qualified pension plan disclosed in Note 7 and elsewhere in these financial statements does not reflect this transaction.

XML

SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 27, 2015

SIGNIFICANT ACCOUNTING POLICIES

Reclassifications and Corrections

Changes in basis of presentation

As discussed more fully in Recently Adopted Accounting Pronouncements below, we elected to early adopt authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) related to the presentation of deferred income taxes and debt issuance costs. As required by this guidance, we have recast our consolidated balance sheet as of December 28, 2014, and certain related footnotes, to conform to the presentation as of December 27, 2015.

Revenue recognition

Revenue recognition

We recognize revenues (i) from advertising placed in a newspaper, a website and/or a mobile service over the advertising contract period or as services are delivered, as appropriate; (ii) from the sale of certain third party digital advertising products and services on a net basis, with wholesale fees reported as a reduction of the associated revenues; and (iii) for audience subscriptions as newspapers and access to online sites are delivered over the applicable subscription term. Audience revenues are recorded net of direct delivery costs for contracts that are not on a “fee-for-service” arrangement. Audience revenues on our “fee-for-service” contracts are recorded on a gross basis and associated delivery costs are recorded as other operating expenses.

We enter into certain revenue transactions, primarily related to advertising contracts and circulation subscriptions that are considered multiple element arrangements (arrangements with more than one deliverable). As such we must: (i) determine whether and when each element has been delivered; (ii) determine fair value of each element using the selling price hierarchy of vendor‑specific objective evidence of fair value, third party evidence or best estimated selling price, as applicable and (iii) allocate the total price among the various elements based on the relative selling price method.

Other revenues are recognized when the related product or service has been delivered. Revenues are recorded net of estimated incentives, including special pricing agreements, promotions and other volume‑based incentives and net of sales tax collected from the customer. Revisions to these estimates are charged to revenues in the period in which the facts that give rise to the revision become known.

Concentrations of credit risks

Concentrations of credit risks

Financial instruments, which potentially subject us to concentrations of credit risks, are principally cash and cash equivalents and trade accounts receivables. Cash and cash equivalents are placed with major financial institutions. As of December 27, 2015, substantially all of our cash and cash equivalents are in excess of the FDIC insured limits. We routinely assess the financial strength of significant customers and this assessment, combined with the large number and geographic diversity of our customers, limits our concentration of risk with respect to trade accounts receivable. We have not experienced any losses related to amounts in excess of FDIC limits.

Allowance for doubtful accounts

Allowance for doubtful accounts

We maintain an allowance account for estimated losses resulting from the risk that our customers will not make required payments. At certain of our newspapers we establish our allowances based on collection experience, aging of our receivables and significant individual account credit risk. At the remaining newspapers we use the aging of accounts receivable, reserving for all accounts due 90 days or longer, to establish allowances for losses on accounts receivable; however, if we become aware that the financial condition of specific customers has deteriorated, additional allowances are provided.

We provide an allowance for doubtful accounts as follows:

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Balance at beginning of year	$	5,900	$	6,040	$	5,920
Charged to costs and expenses		8,181		9,305		8,481
Amounts written off		(9,630)		(9,229)		(8,361)
Disposition of discontinued operations		—		(216)		—
Balance at end of year	$	4,451	$	5,900	$	6,040

Newsprint, ink and other inventories

Newsprint, ink and other inventories

Newsprint, ink and other inventories are stated at the lower of cost (based principally on the first‑in, first‑out method) or current market value. During 2014, we recorded a $2.0 million write‑down of non-newsprint inventory

Property, plant and equipment

Property, plant and equipment

Property, plant and equipment (“PP&E”) are recorded at cost. Additions and substantial improvements, as well as interest expense incurred during construction, are capitalized. Capitalized interest was not material in 2015, 2014 or 2013. Expenditures for maintenance and repairs are charged to expense as incurred. When PP&E is sold or retired, the asset and related accumulated depreciation are removed from the accounts and the associated gain or loss is recognized.

Property, plant and equipment consisted of the following:

	December 27,		December 28,		Estimated
(in thousands)	2015		2014		Useful Lives
Land	$	85,721	$	89,083
Building and improvements		332,502		337,727	5	-	60	years
Equipment		648,206		691,289	2	-	25	years	(1)
Construction in process		7,090		2,696
		1,073,519		1,120,795
Less accumulated depreciation		(709,300)		(716,557)
Property, plant and equipment, net	$	364,219	$	404,238

⁽¹⁾ Presses are 9 - 25 years and other equipment is 2 - 15 years

We record depreciation using the straight‑line method over estimated useful lives. The useful lives are estimated at the time the assets are acquired and are based on historical experience with similar assets and anticipated technological changes. Our depreciation expense was $53.2 million, $60.7 million and $64.4 million in 2015, 2014 and 2013, respectively.

We review the carrying amount of long‑lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events that result in an impairment review include the decision to close a location or a significant decrease in the operating performance of the long‑lived asset. Long‑lived assets are considered impaired if the estimated undiscounted future cash flows of the asset or asset group are less than the carrying amount. For impaired assets, we recognize a loss equal to the difference between the carrying amount of the asset or asset group and its estimated fair value, which is recorded in operating expenses in the consolidated statements of operations. The estimated fair value of the asset or asset group is based on the discounted future cash flows of the asset or asset group. The asset group is defined as the lowest level for which identifiable cash flows are available.

During 2015 we incurred $10.3million in accelerated depreciation related to the production equipment associated with outsourcing our printing process at a few of our newspapers. During 2014 we incurred $13.5 million in accelerated depreciation (i) related to the production equipment associated with outsourcing our printing process at one of our newspapers and (ii) resulting from moving the printing operations for another newspaper to a newly purchased production facility.  

Assets held for sale

Assets held for sale

During 2015 we began to actively market for sale a parking lot at one of our newspapers and a parking structure at another newspaper. No impairment charges were incurred during 2015 as a result of placing these assets in assets held for sale during 2015.

Investments in unconsolidated companies

Investments in unconsolidated companies

We use the equity method of accounting for our investments in, and earnings or losses of, companies that we do not control but over which we do exert significant influence. We consider whether the fair values of any of our equity method investments have declined below their carrying value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If we consider any decline to be other than temporary (based on various factors, including historical financial results and the overall health of the investee), then a write‑down would be recorded to estimated fair value. See Note 3 for discussion of investments in unconsolidated companies.

Segment reporting

Segment reporting

Our primary business is the publication of newspapers and related digital site and direct marketing products. We have two operating segments that we aggregate into a single reportable segment because each has similar economic characteristics, products, customers and distribution methods. Our operating segments are based on how our chief executive officer, who is also our Chief Operating Decision Maker (“CODM”), makes decisions about allocating resources and assessing performance. The CODM is provided discrete financial information for the two operating segments. Each operating segment consists of a group of newspapers and, effective July 1, 2015, following the retirement of a segment manager, both operating segments report to the same segment manager. There was no change to our single reportable segment as a result of the changes to our operating segments. Effective July 1, 2015, one of our operating segments (“Western Segment”) consists of our newspaper operations in California, the Northwest, and the Midwest, while the other operating segment (“Eastern Segment”) consists primarily of newspaper operations in the Southeast and Florida.

Intangible Assets and Goodwill

Goodwill and intangible impairment

We test for impairment of goodwill annually, at year‑end, or whenever events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The required two‑step approach uses accounting judgments and estimates of future operating results. Changes in estimates or the application of alternative assumptions could produce significantly different results. Impairment testing is done at a reporting unit level. We perform this testing on operating segments, which are also considered our reporting units. An impairment loss generally is recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit. The fair value of our reporting units is determined using a combination of a discounted cash flow model and market based approaches. The estimates and judgments that most significantly affect the fair value calculation are assumptions related to revenue growth, newsprint prices, compensation levels, discount rate and private and public market trading multiples for newspaper assets for the market based approach. We consider current market capitalization, based upon the recent stock market prices, plus an estimated control premium in determining the reasonableness of the aggregate fair value of the reporting units. We determined an impairment charge of $290.9 million in 2015 was required. We determined that no impairment charge was required in 2014 or 2013. Also see Note 4.

Newspaper mastheads (newspaper titles and website domain names) are not subject to amortization and are tested for impairment annually, at year‑end, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of each newspaper masthead with its carrying amount. We use a relief from royalty approach which utilizes a discounted cash flow model, as discussed above, to determine the fair value of each newspaper masthead. We determined that an impairment charges of $13.9 million, $5.2 million and $5.3 million in 2015, 2014 and 2013, respectively, were required. Also see Note 4.

Long‑lived assets such as intangible assets (primarily advertiser and subscriber lists) are amortized and tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. The carrying amount of each asset group is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use of such asset group. We had no impairment of long‑lived assets subject to amortization during 2015, 2014 or 2013.

Stock-based compensation

Stock‑based compensation

All stock‑based payments, including grants of stock appreciation rights, restricted stock units and common stock under equity incentive plans, are recognized in the financial statements based on their fair values. At December 27, 2015, we had two stock‑based compensation plans. See Note 10.

Income Taxes

Income taxes

We account for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse.

Current accounting standards in the United States prescribe a recognition threshold and measurement of a tax position taken or expected to be taken in an enterprise’s tax returns. We recognize accrued interest related to unrecognized tax benefits in interest expense. Accrued penalties are recognized as a component of income tax expense.

Fair Value of Financial Instruments

Fair value of financial instruments

We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

Level 1	—	Unadjusted quoted prices available in active markets for identical investments as of the reporting date.
Level 2	—	Observable inputs to the valuation methodology are other than Level 1 inputs and are either directly or indirectly observable as of the reporting date and fair value can be determined through the use of models or other valuation methodologies.
Level 3	—	Inputs to the valuation methodology are unobservable inputs in situations where there is little or no market activity for the asset or liability, and the reporting entity makes estimates and assumptions related to the pricing of the asset or liability including assumptions regarding risk.

Our policy is to recognize significant transfers between levels at the actual date of the event or circumstance that caused the transfer.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

Cash and cash equivalents, accounts receivable, other current assets, accounts payable and other current liabilities. As of December 27, 2015, and December 28, 2014, the carrying amount of these items approximates fair value because of the short maturity of these financial instruments.

Long‑term debt. The fair value of long‑term debt is determined using quoted market prices and other inputs that were derived from available market information including the current market activity of our publicly‑traded notes and bank debt, trends in investor demand and market values of comparable publicly‑traded debt. These are considered to be Level 2 inputs under the fair value measurements and disclosure guidance, and may not be representative of actual. At December 27, 2015, and December 28, 2014, the estimated fair value of long‑term debt was $729.8 million and $994.8 million, respectively. At December 27, 2015, and December 28, 2014, the carrying value of long‑term debt was $905.4 million and $1.0 billion, respectively.

Pension plan. As of December 27, 2015, and December 28, 2014, we had assets related to our qualified defined benefit pension plan measured at fair value. The required disclosures regarding such assets are presented in Note 7.

Certain assets are measured at fair value on a nonrecurring basis; that is, they are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). Our non‑financial assets measured at fair value on a nonrecurring basis in the accompanying consolidated balance sheet as of December 27, 2015, were assets held for sale, goodwill, intangible assets not subject to amortization and equity method investments. All of these were measured using Level 3 inputs. We utilize valuation techniques that seek to maximize the use of observable inputs and minimize the use of unobservable inputs. The significant unobservable inputs include our expected cash flows and discount rate that we estimate market participants would seek for bearing the risk associated with such assets.

Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss

We record changes in our net assets from non‑owner sources in our consolidated statements of stockholders’ equity. Such changes relate primarily to valuing our pension liabilities, net of tax effects.

Our accumulated other comprehensive loss (“AOCL”) and reclassifications from AOCL, net of tax, consisted of the following:

			Other
	Minimum		Comprehensive
	Pension and		Loss
	Post-		Related to
	Retirement		Equity
(in thousands)	Liability		Investments		Total
Balance at December 29, 2013	$	(296,669)	$	(8,232)	$	(304,901)
Other comprehensive income (loss) before reclassifications		—		(819)		(819)
Amounts reclassified from AOCL		(110,883)		—		(110,883)
Other comprehensive income (loss)		(110,883)		(819)		(111,702)
Balance at December 28, 2014	$	(407,552)	$	(9,051)	$	(416,603)
Other comprehensive income (loss) before reclassifications		—		(801)		(801)
Amounts reclassified from AOCL		(4,404)		—		(4,404)
Other comprehensive income (loss)		(4,404)		(801)		(5,205)
Balance at December 27, 2015	$	(411,956)	$	(9,852)	$	(421,808)

	Amount Reclassified from AOCL (in thousands)
	Year Ended		Year Ended
	December 27,		December 28,		Affected Line in the
AOCL Component	2015		2014		Consolidated Statements of Operations
Minimum pension and post-retirement liability	$	(7,340)	$	(184,805)	Compensation
		2,936		73,922	Provision (benefit) for income taxes
	$	(4,404)	$	(110,883)	Net of tax

Earnings Per Share (EPS)

Earnings per share (EPS)

Basic EPS excludes dilution from common stock equivalents and reflects income divided by the weighted average number of common shares outstanding for the period. Diluted EPS is based upon the weighted average number of outstanding shares of common stock and dilutive common stock equivalents in the period. Common stock equivalents arise from dilutive stock options, restricted stock units and restricted stock and are computed using the treasury stock method. The weighted average anti‑dilutive stock options that could potentially dilute basic EPS in the future, but were not included in the weighted average share calculation consisted of the following:

	Years Ended
	December 27,	December 28,	December 29,
(shares in thousands)	2015	2014	2013
Anti-dilutive stock options	5,173	1,519	4,941

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

In May 2014, the FASB issued Accounting Standards Update (“ASU”) ASU No. 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 outlines a new, single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized. The new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services. It is effective for us for annual and interim periods beginning on or after December 15, 2017, and early adoption is permitted for interim or annual reporting periods beginning after December 15, 2016. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

In August 2014, the FASB issued ASU No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” ASU 2014-15 requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnotes disclosures in certain circumstances. It is effective for us for annual and interim periods beginning on or after December 15, 2016, with early adoption permitted. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In February 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810); Amendments to the Consolidated Analysis,” which changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. It is effective for us for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-05, "Customer's Accounting for Fees Paid in a Cloud Computing Arrangement." ASU 2015-05 provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance does not change the accounting for service contracts. It is effective for us for interim and annual reporting periods beginning after December 15, 2015. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” ASU 2015-11 simplifies the measurement of inventory by requiring certain inventory to be measured at the “lower of cost and net realizable value” and options that currently exist for “market value” will be eliminated. The ASU defines net realizable value as the “estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.” It is effective for us for interim and annual reporting periods beginning after December 15, 2016. The standard should be applied prospectively with early adoption permitted. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” ASU 2016-01 addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 is effective for us for interim and annual reporting periods beginning after December 15, 2017. We do not believe the adoption of this guidance will have an impact on our consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, “Leases” (Accounting Standards Codification 842 (“ASC 842”)) and it replaces the existing guidance in ASC 840, “Leases.”  ASC 842 requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. The new lease standard does not substantially change lessor accounting. It is effective for us for interim and annual reporting periods beginning after December 15, 2018,with early adoption permitted. We are currently in the process of evaluating the impact of the adoption on our consolidated financial statements.

Recently Adopted Accounting Pronouncements

In April 2014, the FASB issued ASU No. 2014-08, “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” which raised the threshold for a disposal to qualify as a discontinued operation and required new disclosures of both discontinued operations and certain other disposals that did not meet the definition of a discontinued operation. This guidance was effective for us at the beginning of 2015.

In April 2015 the FASB issued ASU No. 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which amended existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability instead of deferred charges. It was effective for us for annual and interim periods beginning on or after December 15, 2015, however early adoption was permitted. In August 2015, the FASB issued ASU No. 2015-15, “Interest-Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of Credit Arrangements-Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting,” to clarify that an entity may elect to present debt issuance costs related to a line-of-credit arrangement as an asset, regardless of whether or not there are any outstanding borrowings on the line-of-credit arrangement. We early adopted these standards retrospectively and elected to present the debt issuance costs related to our line-of credit arrangement, combined with the other debt issuance costs on our term loan debt, as a reduction in long-term debt. As of December 28, 2014, we reclassified unamortized debt issuance costs of $12.1 million from other assets to a reduction in long-term debt on the consolidated balance sheet.

In April 2015 the FASB issued ASU No. 2015-04, "Compensation – Retirement Benefits: Practical Expedient for the Measurement Date of an Employer’s Defined Benefit Obligation and Plan Assets," which provided practical expedient, which permitted a reporting entity with a fiscal year-end that does not coincide with a month-end, to measure defined benefit plan assets and obligations using the month-end that is closest to the entity’s fiscal year-end and apply that practical expedient consistently from year to year. It is effective for us for interim and annual reporting periods beginning after December 15, 2015, with early application permitted. We early adopted this standard and it did not have a material impact on our consolidated financial statements.

In November 2015 the FASB issued ASU No. 2015-17, "Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes," which simplifies the presentation of deferred income taxes by requiring deferred tax assets and liabilities to be classified as noncurrent on the balance sheet. It was effective for us for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We early adopted this standard retrospectively, and reclassified our current deferred income taxes to net them with noncurrent deferred income taxes for all periods presented. As of December 28, 2014, we reclassified deferred income taxes of $1.1 million from current assets to a reduction in deferred income taxes in noncurrent liabilities on the consolidated balance sheet

XML

SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 27, 2015

SIGNIFICANT ACCOUNTING POLICIES

Schedule of allowance for doubtful accounts

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Balance at beginning of year	$	5,900	$	6,040	$	5,920
Charged to costs and expenses		8,181		9,305		8,481
Amounts written off		(9,630)		(9,229)		(8,361)
Disposition of discontinued operations		—		(216)		—
Balance at end of year	$	4,451	$	5,900	$	6,040

Schedule of components of property, plant and equipment

	December 27,		December 28,		Estimated
(in thousands)	2015		2014		Useful Lives
Land	$	85,721	$	89,083
Building and improvements		332,502		337,727	5	-	60	years
Equipment		648,206		691,289	2	-	25	years	(1)
Construction in process		7,090		2,696
		1,073,519		1,120,795
Less accumulated depreciation		(709,300)		(716,557)
Property, plant and equipment, net	$	364,219	$	404,238

⁽¹⁾ Presses are 9 - 25 years and other equipment is 2 - 15 years

Schedule of components of accumulated other comprehensive loss, net of tax

			Other
	Minimum		Comprehensive
	Pension and		Loss
	Post-		Related to
	Retirement		Equity
(in thousands)	Liability		Investments		Total
Balance at December 29, 2013	$	(296,669)	$	(8,232)	$	(304,901)
Other comprehensive income (loss) before reclassifications		—		(819)		(819)
Amounts reclassified from AOCL		(110,883)		—		(110,883)
Other comprehensive income (loss)		(110,883)		(819)		(111,702)
Balance at December 28, 2014	$	(407,552)	$	(9,051)	$	(416,603)
Other comprehensive income (loss) before reclassifications		—		(801)		(801)
Amounts reclassified from AOCL		(4,404)		—		(4,404)
Other comprehensive income (loss)		(4,404)		(801)		(5,205)
Balance at December 27, 2015	$	(411,956)	$	(9,852)	$	(421,808)

Schedule of reclassification out of accumulated other comprehensive income

	Amount Reclassified from AOCL (in thousands)
	Year Ended		Year Ended
	December 27,		December 28,		Affected Line in the
AOCL Component	2015		2014		Consolidated Statements of Operations
Minimum pension and post-retirement liability	$	(7,340)	$	(184,805)	Compensation
		2,936		73,922	Provision (benefit) for income taxes
	$	(4,404)	$	(110,883)	Net of tax

Summary of anti-dilutive stock options

	Years Ended
	December 27,	December 28,	December 29,
(shares in thousands)	2015	2014	2013
Anti-dilutive stock options	5,173	1,519	4,941

XML

DIVESTITURE (Tables)

12 Months Ended

Dec. 27, 2015

DIVESTITURE

Summary of financial information for the operations

	Year Ended
	December 28,		December 29,
(in thousands)	2014		2013
Revenues	$	9,071	$	27,389
Loss from discontinued operations, before taxes	$	(203)	$	3,956
Income tax benefit		251		1,597
Loss from discontinued operations, net of tax, before loss on sale	$	(454)	$	2,359
Gain (loss) on sale of discontinued operations	$	5,391	$	—
Income tax provision		6,925		—
Loss on sale of discontinued operations, net of tax		(1,534)		—
Loss from discontinued operations, net of tax	$	(1,988)	$	2,359

XML

INVESTMENTS IN UNCONSOLIDATED COMPANIES (Tables)

12 Months Ended

Dec. 27, 2015

INVESTMENTS IN UNCONSOLIDATED COMPANIES

Summary of carrying value of investments in unconsolidated companies

(in thousands)	% Ownership	December 27,		December 28,
Company	Interest	2015		2014
CareerBuilder, LLC	15.0	$	230,170	$	226,965
Other	Various		3,368		3,508
		$	233,538	$	230,473

Schedule of dividend received and other equity distributions

	Years Ended
	December 27,		December 28,
(in thousands)	2015		2014
CareerBuilder, LLC	$	7,500	$	6,750
Other		7,460		155,576
	$	14,960	$	162,326

Summary of expenses incurred for products provided by unconsolidated companies and recorded in operating expenses

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
CareerBuilder, LLC	$	1,001	$	1,024	$	1,109
Ponderay (general partnership)		8,200		10,433		16,313

Summary of financial information for company's investments in unconsolidated companies on a combined basis

	December 27,		December 28,
(in thousands)	2015		2014
Current assets	$	365,993	$	359,349
Noncurrent assets		540,629		577,837
Current liabilities		236,630		247,825
Noncurrent liabilities		228,209		180,764
Equity		441,783		508,597

Summary of income statement information from the entities accounted for under the equity method

	Year ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Net revenues	$	988,871	$	1,368,593	$	1,512,534
Gross profit		843,680		1,155,091		1,262,104
Operating income		38,561		146,809		231,952
Net income		39,143		151,519		247,441

XML

INTANGIBLE ASSETS AND GOODWILL (Tables)

12 Months Ended

Dec. 27, 2015

INTANGIBLE ASSETS AND GOODWILL

Schedule of intangible assets (primarily advertiser lists, subscriber lists and developed technology), mastheads and goodwill

	December 28,		Acquired		Disposition		Impairment		Amortization		December 27,
(in thousands)	2014		Adjustment		Adjustment		Charges		Expense		2015
Intangible assets subject to amortization	$	833,254	$	—	$	—	$	—	$	—	$	833,254
Accumulated amortization		(615,378)		—		—		—		(48,357)		(663,735)
		217,876		—		—		—		(48,357)		169,519
Mastheads		193,039		—		—		(13,907)		—		179,132
Goodwill		996,115		—		—		(290,941)		—		705,174
Total	$	1,407,030	$	—	$	—	$	(304,848)	$	(48,357)	$	1,053,825

	December 29,		Acquired		Disposition		Impairment		Amortization		December 28,
(in thousands)	2013		Adjustment		Adjustment		Charges		Expense		2014
Intangible assets subject to amortization	$	835,461	$	3,100	$	(5,307)	$	—	$	—	$	833,254
Accumulated amortization		(567,737)		—		5,307		—		(52,948)		(615,378)
		267,724		3,100		—		—		(52,948)		217,876
Mastheads		198,242		—		—		(5,203)		—		193,039
Goodwill		1,013,002		—		(16,887)		—		—		996,115
Total	$	1,478,968	$	3,100	$	(16,887)	$	(5,203)	$	(52,948)	$	1,407,030

Summary of amortization expense with respect to intangible assets

	December 27, 2015						December 28, 2014
	Original Gross		Accumulated		Carrying		Original Gross		Accumulated		Carrying
(in thousands)	Amount		Impairment		Amount		Amount		Impairment		Amount
Mastheads	$	683,000	$	(503,868)	$	179,132	$	683,000	$	(489,961)	$	193,039
Goodwill		3,571,111		(2,865,937)		705,174		3,571,111		(2,574,996)		996,115
Total	$	4,254,111	$	(3,369,805)	$	884,306	$	4,254,111	$	(3,064,957)	$	1,189,154

Amortization expense for the five succeeding fiscal years

	Amortization
	Expense
Year	(in thousands)
2016	$	47,986
2017		48,907
2018		47,275
2019		23,769
2020		418

XML

LONG-TERM DEBT (Tables)

12 Months Ended

Dec. 27, 2015

LONG-TERM DEBT

Summary of company's long-term debt

	Face Value at		Carrying Value
	December 27,		December 27,		December 28,
(in thousands)	2015		2015		2014
Notes:
9.00% senior secured notes due in 2022	$	516,415	$	506,571	$	543,640
5.750% notes due in 2017		55,442		54,551		108,489
7.150% debentures due in 2027		89,188		84,469		84,076
6.875% debentures due in 2029		276,230		259,834		258,607
Long-term debt	$	937,275	$	905,425	$	994,812

Redeemed or repurchase of notes

(in thousands)	Face Value
9.00% senior secured notes due in 2022	$	39,370
5.750% notes due in 2017		55,857
Total notes repurchased	$	95,227

Annual maturities of debt

	Payments
Year	(in thousands)
2016	$	—
2017		55,442
2018		—
2019		—
2020		—
Thereafter		881,833
Debt principal	$	937,275

XML

INCOME TAXES (Tables)

12 Months Ended

Dec. 27, 2015

INCOME TAXES

Schedule of income tax provision (benefit) related to continuing operations

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Current:
Federal	$	13,317	$	233,247	$	16,100
State		(2,027)		30,216		5,108
Deferred:
Federal		(17,642)		(29,182)		(7,262)
State		(5,445)		(3,051)		(2,287)
Income tax provision (benefit)	$	(11,797)	$	231,230	$	11,659

Schedule of reconciliation of effective tax rate expense (benefit) for continuing operations and the statutory federal income tax rate

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Statutory rate	(35.0)	%	35.0	%	35.0	%
State taxes, net of federal benefit	(2.1)		3.0		12.3
Changes in estimates	0.1		—		—
Changes in unrecognized tax benefits	0.3		—		(6.0)
Settlements	—		(0.1)		(1.5)
Other	—		0.1		3.1
Goodwill impairment	32.5		—		—
Stock compensation	0.4		0.1		(1.4)
Effective tax rate	(3.8)	%	38.1	%	41.5	%

Schedule of components of deferred tax assets and liabilities

	December 27,		December 28,
(in thousands)	2015		2014
Deferred tax assets:
Compensation benefits	$	233,101	$	248,585
State taxes		3,586		6,061
State loss carryovers		2,877		2,266
Other		3,765		4,508
Total deferred tax assets		243,329		261,420
Valuation allowance		(2,877)		(2,265)
Net deferred tax assets		240,452		259,155
Deferred tax liabilities:
Depreciation and amortization		160,752		195,616
Investments in unconsolidated subsidiaries		50,434		52,711
Debt discount		8,301		9,618
Deferred gain on debt		19,653		26,318
Total deferred tax liabilities		239,140		284,263
Net deferred tax (assets) liabilities	$	(1,312)	$	25,108

Schedule of reconciliation of the beginning and ending amount of unrecognized tax benefits

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Balance at beginning of fiscal year	$	13,046	$	12,889	$	8,649
Increases based on tax positions in prior year		4,433		1		7,631
Decreases based on tax positions in prior year		—		(363)		(935)
Increases based on tax positions in current year		1,435		1,357		1,386
Settlements		—		(49)		(259)
Lapse of statute of limitations		(3,293)		(789)		(3,583)
Balance at end of fiscal year	$	15,621	$	13,046	$	12,889

Schedule of tax years and related taxing jurisdictions that were open for audit

	Open	Years Under
Taxing Jurisdiction	Tax Year	Exam
Federal	2012-2015	2013
California	2011-2015	—
Other States	2006-2015	2011-2014

XML

EMPLOYEE BENEFITS (Tables)

12 Months Ended

Dec. 27, 2015

EMPLOYEE BENEFITS

Schedule of elements of retirement expense

	Years Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Pension plans:
Service Cost	$	11,680	$	8,030	$	5,545
Interest Cost		84,994		91,004		84,596
Expected return on plan assets		(106,283)		(107,460)		(101,053)
Prior service cost amortization		—		12		14
Actuarial loss		22,194		16,009		25,557
Net pension expense		12,585		7,595		14,659
Net post-retirement benefit credit		(2,614)		(2,963)		(2,497)
Net retirement expenses	$	9,971	$	4,632	$	12,162

Schedule of reconciliations of the pension and post-retirement benefit plans' benefit obligations, fair value of assets and funded status

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Change in Benefit Obligation
Benefit obligation, beginning of year	$	2,051,907	$	1,849,321	$	10,602	$	12,586
Service cost		11,680		8,030		—		—
Interest cost		84,994		91,004		368		514
Plan participants’ contributions		—		—		35		267
Actuarial (gain)/loss		(101,952)		213,176		(87)		467
Gross benefits paid		(103,062)		(101,441)		(1,035)		(1,611)
Plan amendment		—		—		—		(1,621)
Administrative expenses		(12,247)		(8,183)		—		—
Benefit obligation, end of year	$	1,931,320	$	2,051,907	$	9,883	$	10,602

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Change in Plan Assets
Fair value of plan assets, beginning of year	$	1,478,686	$	1,432,695	$	—	$	—
Actual return on plan assets		(22,307)		122,133		—		—
Employer contribution		8,533		33,482		1,000		1,344
Plan participants’ contributions		—		—		35		267
Gross benefits paid		(103,062)		(101,441)		(1,035)		(1,611)
Administrative expenses		(12,247)		(8,183)		—		—
Fair value of plan assets, end of year	$	1,349,603	$	1,478,686	$	—	$	—

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Funded Status
Fair value of plan assets	$	1,349,603	$	1,478,686	$	—	$	—
Benefit obligations		(1,931,320)		(2,051,907)		(9,883)		(10,602)
Funded status and amount recognized, end of year	$	(581,717)	$	(573,221)	$	(9,883)	$	(10,602)

Schedule of amounts recognized in the consolidated balance sheet

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Current liability	$	(8,450)	$	(8,529)	$	(1,298)	$	(1,270)
Noncurrent liability		(573,267)		(564,692)		(8,585)		(9,332)
	$	(581,717)	$	(573,221)	$	(9,883)	$	(10,602)

Schedule of amounts recognized in accumulated other comprehensive income

	Pension Benefits				Post-retirement Benefits
(in thousands)	2015		2014		2015		2014
Net actuarial loss/(gain)	$	705,853	$	701,408	$	(8,568)	$	(9,385)
Prior service cost/(credit)		—		—		(10,690)		(12,768)
	$	705,853	$	701,408	$	(19,258)	$	(22,153)

Schedule of weighted average assumptions used for valuing benefit obligations

	Pension Benefit				Post-retirement
	Obligations				Obligations
	2015		2014		2015		2014
Discount rate	4.71	%	4.24	%	4.21	%	3.69	%

Schedule of weighted average assumptions used in calculating expense

	Pension Benefit Expense						Post-retirement Expense
	December 27,		December 28,		December 29,		December 27,		December 28,		December 29,
	2015		2014		2013		2015		2014		2013
Expected long-term return on plan assets	7.75	%	8.00	%	8.00	%	N/A		N/A		N/A
Discount rate	4.24	%	5.01	%	4.17	%	3.69	%	4.36	%	3.39	%

Summary of expected benefit payments to retirees under the Company's retirement and post-retirement plans

	Retirement		Post-retirement
(in thousands)	Plans (1)		Plans
2016	$	101,524	$	1,297
2017		104,592		1,198
2018		107,158		1,105
2019		112,402		1,026
2020		113,173		942
2021-2025		612,003		3,567
Total	$	1,150,852	$	9,135

⁽¹⁾ Largely to be paid from the qualified defined benefit pension plan

Summary of pension plan's financial instruments that are carried at fair value on a recurring basis by the fair value hierarchy levels

	2015
	Plan Assets
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents	$	844	$	—	$	—	$	844
Mutual funds		436,316		—		—		436,316
Corporate debt instruments		—		112		—		112
Common collective trusts		—		845,686		—		845,686
Real estate		—		—		50,360		50,360
Private equity funds		—		—		7,282		7,282
Total	$	437,160	$	845,798	$	57,642	$	1,340,600
Pending trades								9,003
							$	1,349,603

	2014
	Plan Assets
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents	$	1,068	$	—	$	—	$	1,068
Mutual funds		485,488		—		—		485,488
Corporate debt instruments		—		106		—		106
Common collective trusts		—		937,809		—		937,809
Real estate		—		—		47,579		47,579
Private equity funds		—		—		6,636		6,636
Total	$	486,556	$	937,915	$	54,215	$	1,478,686

Summary of changes in the fair value of the pension plan's Level 3 investment assets

(in thousands)	Real Estate		Private Equity		Total
Beginning Balance, December 28, 2014	$	47,579	$	6,636	$	54,215
Purchases, issuances, sales, settlements		—		—		—
Realized gains (losses)		2,479		—		2,479
Transfer in or out of level 3		(3,936)		—		(3,936)
Unrealized gains (losses)		4,238		646		4,884
Ending Balance, December 27, 2015	$	50,360	$	7,282	$	57,642

⁽¹⁾ The activity within the unrealized gains (losses) and the realized gains (losses) relates to closing out two funds within the private equity funds. There was no impact to the total asset value of the private equity funds as a result of these transactions.

(in thousands)	Real Estate		Private Equity (1)		Total
Beginning Balance, December 29, 2013	$	52,265	$	7,167	$	59,432
Purchases, issuances, sales, settlements		(3,312)		—		(3,312)
Realized gains		3,973		(16,153)		(12,180)
Transfer in or out of level 3		(3,973)		(483)		(4,456)
Unrealized gains		(1,374)		16,105		14,731
Ending Balance, December 28, 2014	$	47,579	$	6,636	$	54,215

XML

CASH FLOW INFORMATION (Tables)

12 Months Ended

Dec. 27, 2015

CASH FLOW INFORMATION

Schedule of cash paid for interest and income taxes

	Year Ended
	December 27,		December 28,		December 29,
(in thousands)	2015		2014		2013
Interest paid (net of amount capitalized)	$	80,514	$	121,375	$	127,257
Income taxes paid (net of refunds)		207,043		77,622		21,019

XML

COMMITMENTS AND CONTINGENCIES (Tables)

12 Months Ended

Dec. 27, 2015

COMMITMENTS AND CONTINGENCIES

Summary of minimum annual contractual obligations

	Payments Due By Period
(in thousands)	2016		2017		2018		2019		2020		Thereafter		Total
Purchase obligations (1)	$	19,364	$	10,035	$	6,669	$	5,829	$	5,031	$	23,581	$	70,509
Operating leases (2)
Lease obligations		11,467		10,146		8,819		7,122		5,219		24,735		67,508
Sublease income		(3,336)		(2,342)		(1,441)		(1,028)		(611)		(1,748)		(10,506)
Net lease obligation		8,131		7,804		7,378		6,094		4,608		22,987		57,002
Workers’ compensation obligations (3)		3,599		2,425		1,822		1,356		1,045		6,361		16,608
Total (4)	$	31,094	$	20,264	$	15,869	$	13,279	$	10,684	$	52,929	$	144,119

(1) Represents our purchase obligations primarily related to printing outsource agreements and capital expenditures for property, plant and equipment expiring at various dates through 2028.

(2) Represents minimum rental commitments under operating leases with non‑cancelable terms in excess of one year and sublease income from leased space. We rent certain facilities and equipment under operating leases expiring at various dates through 2028. Total rental expense, included in other operating expenses, from continuing operations amounted to $11.6 million, $12.5 million and $11.2 million in 2015, 2014 and 2013, respectively. Most of the leases provide that we pay taxes, maintenance, insurance and certain other operating expenses applicable to the leased premises in addition to the minimum monthly payments. Some of the operating leases have built in escalation clauses. We sublease office space to other companies under noncancellable agreements that expire at various dates through 2024. Sublease income from operating leases totaled $4.6 million, $2.2 million and $3.9 million in 2015, 2014 and 2013, respectively.

(3) Represents the expected insurance payments of undiscounted ultimate losses, net of estimated insurance recoveries of approximately $3.2 million, and was based on our historical payment patterns. We retain the risk for workers’ compensation resulting from uninsured deductibles per accident or occurrence that are subject to annual aggregate limits. Losses up to the deductible amounts are accrued based upon known claims incurred and an estimate of claims incurred but not reported. For the year ended December 27, 2015, we compiled our historical data pertaining to the self‑insurance experiences and actuarially developed the ultimate loss associated with our self‑insurance programs for workers’ compensation liability. We believe that the actuarial valuation provides the best estimate of the ultimate losses to be expected under these programs. The undiscounted ultimate losses of all our self‑insurance reserves related to our workers’ compensation liabilities, net of insurance recoveries at December 27, 2015, and December 28, 2014, were $16.6 million and $18.0 million, respectively. We discount the net amount above to present value using an approximate risk‑free rate over the average life of our insurance claims. For the years ended December 27, 2015, and December 28, 2014, the discount rate used was 1.8% and 2.0%, respectively. The present value of all self‑insurance reserves, net of estimated insurance recoveries, for our workers’ compensation liability recorded at December 27, 2015, and December 28, 2014, was $15.3 million and $17.5 million, respectively.

XML

COMMONS STOCK AND STOCK PLANS (Tables)

12 Months Ended

Dec. 27, 2015

COMMON STOCK AND STOCK PLANS

Summary of the restricted stock units ("RSUs") activity

		Weighted
		Average Grant
		Date Fair
	RSUs	Value
Nonvested — December 30, 2012	1,102,000	$	2.98
Granted	483,150	$	2.46
Vested	(320,000)	$	4.08
Forfeited	(33,500)	$	2.48
Nonvested — December 29, 2013	1,231,650	$	2.50
Granted	856,950	$	4.61
Vested	(717,150)	$	2.92
Forfeited	(41,900)	$	2.93
Nonvested — December 28, 2014	1,329,550	$	3.62
Granted	1,365,300	$	2.28
Vested	(970,000)	$	2.85
Forfeited	(186,050)	$	3.08
Nonvested — December 27, 2015	1,538,800	$	2.98

Summary of the stock appreciation rights ("SARs") activity

		Weighted		Aggregate
		Average		Intrinsic Value
	SARs	Exercise Price		(in thousands)
Outstanding December 30, 2012	6,194,500	$	11.45	$	1,846
Granted	775,000	$	2.46
Exercised	(545,750)	$	1.72	$	847
Forfeited	(58,500)	$	3.30
Expired	(254,750)	$	48.97
Outstanding December 29, 2013	6,110,500	$	9.69	$	2,384
Exercised	(1,678,250)	$	2.86	$	3,138
Forfeited	(67,250)	$	3.38
Expired	(516,250)	$	35.74
Outstanding December 28, 2014	3,848,750	$	9.28	$	1,542
Forfeited	(68,750)	$	2.61
Expired	(578,750)	$	20.76
Outstanding December 27, 2015	3,201,250	$	7.35	$	—
Vested and Expected to Vest December 27, 2015	3,179,366	$	8.09	$	—
Options exercisable:
December 29, 2013	3,983,875			$	1,306
December 28, 2014	2,719,750			$	716
December 27, 2015	2,774,125			$	—

Summary of stock-based compensation expense

	Years Ended
	December 27,		December 29,		December 29,
(in thousands)	2015		2014		2013
Stock-based compensation expense	$	3,178	$	3,479	$	3,481

Summary of information about stock options and SARs outstanding in the stock plans

		Average
		Remaining	Weighted			Weighted
Range of Exercise	Options/SARs	Contractual	Average		Options/SARs	Average
Prices	Outstanding	Life	Exercise Price		Exercisable	Exercise Price
$1.70 – $9.07	2,426,250	4.70	$	3.06	1,999,125	$	3.17
$9.73 – $35.94	574,000	1.91	$	13.17	574,000	$	13.17
$40.95 – $73.36	201,000	0.92	$	42.48	201,000	$	42.48
Total	3,201,250	3.96	$	7.35	2,774,125	$	8.09

Schedule of weighted average assumptions used to estimate the fair value of SARs granted

	2013
Expected life in years		4.51
Dividend yield		NIL
Volatility		1.08
Risk-free interest rate		0.76	%
Weighted average exercise price of options/SARs granted	$	2.46
Weighted average fair value of options/SARs granted	$	1.85

XML

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Tables)

12 Months Ended

Dec. 27, 2015

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

Schedule of the Company's quarterly results

	Quarters Ended
(in thousands, except per share	March 29,		June 28,		September 27,		December 27,
amounts)	2015		2015		2015		2015
Net revenues	$	257,178	$	262,360	$	251,211	$	285,825
Operating income (loss)	$	(1,158)	$	(288,966)	$	8,389	$	36,396
Income (loss) from continuing operations	$	(11,346)	$	(296,497)	$	(1,149)	$	8,830
Income (loss) from discontinued operations		—		—		—		—
Net income (loss)	$	(11,346)	$	(296,497)	$	(1,149)	$	8,830
Income (loss) from continuing operations per share - diluted	$	(0.13)	$	(3.39)	$	(0.01)	$	0.10
Income (loss) from discontinued operations per share - diluted		—		—		—		—
Net income (loss) per share - diluted	$	(0.13)	$	(3.39)	$	(0.01)	$	0.10

	Quarters Ended
(in thousands, except per share	March 30,		June 29,		September 28,		December 28,
amounts)	2014		2014		2014		2014
Net revenues	$	276,171	$	287,391	$	272,899	$	310,091
Operating income	$	(4,698)	$	27,307	$	18,550	$	41,164
Income (loss) from continuing operations	$	(16,062)	$	91,648	$	(2,619)	$	303,010
Income from discontinued operations		220		(1,699)		(141)		(368)
Net income (loss)	$	(15,842)	$	89,949	$	(2,760)	$	302,642
Income (loss) from continuing operations per share - diluted	$	(0.18)	$	1.03	$	(0.03)	$	3.45
Income from discontinued operations per share - diluted		—		(0.01)		—		(0.01)
Net income (loss) per share - diluted	$	(0.18)	$	1.02	$	(0.03)	$	3.44

XML

SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions	12 Months Ended
	Dec. 27, 2015 USD ($) item	Dec. 28, 2014 USD ($)	Dec. 29, 2013
Investments in Unconsolidated Companies Activity
Number of media companies	29
Number of markets	28
Number of states	14
Length of fiscal year	364 days	364 days	364 days
Long-term debt fair value disclosure
Estimated fair value of long-term debt | $	$ 729.8	$ 994.8
Career Builder LLC
Investments in Unconsolidated Companies Activity
Ownership Interest (as a percent)	15.00%
Home Finder LLC
Investments in Unconsolidated Companies Activity
Ownership Interest (as a percent)	33.30%

XML

SIGNIFICANT ACCOUNTING POLICIES - Allowance (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Changes in allowance for doubtful accounts
Balance at beginning of year	$ 5,900	$ 6,040	$ 5,920
Charged to costs and expenses	8,181	9,305	8,481
Amounts written off	(9,630)	(9,229)	(8,361)
Disposition of discontinued operations		(216)
Balance at end of year	$ 4,451	5,900	$ 6,040
Newsprint, ink and other inventories
Inventory Write-down		$ 2,000

XML

SIGNIFICANT ACCOUNTING POLICIES - Property thru Debt (Details) $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 28, 2014 USD ($)	Dec. 27, 2015 USD ($) item	Dec. 28, 2014 USD ($) item	Dec. 29, 2013 USD ($)	Dec. 30, 2012 USD ($)
Depreciation
Property, plant and equipment, gross	$ 1,120,795	$ 1,073,519	$ 1,120,795
Less accumulated depreciation	(716,557)	(709,300)	(716,557)
Property, plant and equipment, net	404,238	364,219	404,238
Depreciation expense		53,200	60,700	$ 64,400
Accelerated depreciation incurred		10,300	$ 13,500
Number of newspapers impaired | item			1
Impairment charge of assets held for sale		0
Segment reporting
Number of operating segments | item			2
Goodwill and intangible impairment
Goodwill impairment charge		290,941	$ 0	0	$ 0
Impairment charge of newspaper masthead	5,200	$ 13,907	5,203	0
Impairment of long-lived assets subject to amortization			0	$ 0	$ 0
Stock-based compensation
Number of stock-based compensation plans | item		2
Long-term debt fair value disclosure
Estimated fair value of long-term debt	994,800	$ 729,800	994,800
Carrying value of long-term debt	994,812	905,425	994,812
Land
Depreciation
Property, plant and equipment, gross	89,083	85,721	89,083
Buildings and improvements
Depreciation
Property, plant and equipment, gross	337,727	$ 332,502	337,727
Buildings and improvements | Minimum
Depreciation
Estimated Useful Lives		5 years
Buildings and improvements | Maximum
Depreciation
Estimated Useful Lives		60 years
Equipment
Depreciation
Property, plant and equipment, gross	691,289	$ 648,206	691,289
Equipment | Minimum
Depreciation
Estimated Useful Lives		2 years
Equipment | Maximum
Depreciation
Estimated Useful Lives		25 years
Construction in process
Depreciation
Property, plant and equipment, gross	$ 2,696	$ 7,090	$ 2,696
Presses | Minimum
Depreciation
Estimated Useful Lives		9 years
Presses | Maximum
Depreciation
Estimated Useful Lives		25 years
Other Machinery and Equipment [Member] | Minimum
Depreciation
Estimated Useful Lives		2 years
Other Machinery and Equipment [Member] | Maximum
Depreciation
Estimated Useful Lives		15 years

XML

SIGNIFICANT ACCOUNTING POLICIES - AOCI (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 27, 2015	Sep. 27, 2015	Jun. 28, 2015	Mar. 29, 2015	Dec. 28, 2014	Sep. 28, 2014	Jun. 29, 2014	Mar. 30, 2014	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Changes in accumulated other comprehensive loss
Balance at the beginning of the period				$ (416,603)				$ (304,901)	$ (416,603)	$ (304,901)
Other comprehensive income (loss) before reclassifications									(801)	(819)
Amounts reclassified from AOCL									(4,404)	(110,883)
Other comprehensive income (loss)									(5,205)	(111,702)	$ 176,415
Balance at the end of the period	$ (421,808)				$ (416,603)				(421,808)	(416,603)	(304,901)
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Compensation									395,449	411,881	422,981
Provision for income taxes									(11,797)	231,230	11,659
Net of tax	(8,830)	$ 1,149	$ 296,497	11,346	(302,642)	$ 2,760	$ (89,949)	15,842	300,162	(373,989)	(18,803)
Minimum Pension and Post-Retirement Liability
Changes in accumulated other comprehensive loss
Balance at the beginning of the period				(407,552)				(296,669)	(407,552)	(296,669)
Amounts reclassified from AOCL									(4,404)	(110,883)
Other comprehensive income (loss)									(4,404)	(110,883)
Balance at the end of the period	(411,956)				(407,552)				(411,956)	(407,552)	(296,669)
Minimum Pension and Post-Retirement Liability | Amount Reclassified from AOCI
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Compensation									(7,340)	(184,805)
Provision for income taxes									2,936	73,922
Net of tax									(4,404)	(110,883)
Other Comprehensive Loss Related to Equity Investments
Changes in accumulated other comprehensive loss
Balance at the beginning of the period				$ (9,051)				$ (8,232)	(9,051)	(8,232)
Other comprehensive income (loss) before reclassifications									(801)	(819)
Other comprehensive income (loss)									(801)	(819)
Balance at the end of the period	$ (9,852)				$ (9,051)				$ (9,852)	$ (9,051)	$ (8,232)

XML

SIGNIFICANT ACCOUNTING POLICIES - EPS (Details) - shares shares in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Anti-dilutive stock options, restricted stock units and restricted stock
Weighted average anti-dilutive stock options
Anti-dilutive stock options (in shares)	5,173	1,519	4,941

XML

SIGNIFICANT ACCOUNTING POLICIES - Adopted Pronouncements (Details) - USD ($) $ in Thousands	Dec. 27, 2015	Dec. 28, 2014
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Other assets	$ 65,078	$ 62,160
Long-term debt	905,425	994,812
Deferred income taxes		25,108
Current assets	205,062	$ 436,815
Accounting Standards Update 2015 03 | Adjustments for New Accounting Principle, Early Adoption
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Other assets	(12,100)
Long-term debt	(12,100)
Accounting Standards Update 2015 17 | Adjustments for New Accounting Principle, Early Adoption
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Deferred income taxes	(1,100)
Current assets	$ (1,100)

XML

DIVESTITURE (Details) - USD ($) $ in Thousands		3 Months Ended				12 Months Ended
	May. 05, 2014	Dec. 28, 2014	Sep. 28, 2014	Jun. 29, 2014	Mar. 30, 2014	Dec. 28, 2014	Dec. 29, 2013
Financial information for operations
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAXES		$ (368)	$ (141)	$ (1,699)	$ 220	$ (1,988)	$ 2,359
Anchorage Daily News | Discontinued Operations, Disposed of by Sale
DIVESTITURE
Proceeds from sale	$ 34,000
Financial information for operations
Revenues						9,071	27,389
Loss from discontinued operations, before taxes						(203)	3,956
Income tax benefit						251	1,597
Loss from discontinued operations, net of tax, before loss on sale						(454)	2,359
Gain (loss) on sale of discontinued operations						5,391
Income tax provisions						6,925
Loss on sale of discontinued operations, net of tax						(1,534)
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAXES						$ (1,988)	$ 2,359

XML

INVESTMENTS IN UNCONSOLIDATED COMPANIES (Details) - USD ($) $ in Thousands				1 Months Ended	3 Months Ended				12 Months Ended
	Oct. 01, 2014	May. 07, 2014	Apr. 01, 2014	Apr. 30, 2015	Dec. 27, 2015	Mar. 29, 2015	Dec. 28, 2014	Jun. 29, 2014	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013	Dec. 30, 2012
Investments in unconsolidated companies and joint ventures
Investments in unconsolidated companies					$ 233,538		$ 230,473		$ 233,538	$ 230,473
Intangible asset - newswire content										3,100
Equity Method Investment, Realized Gain (Loss) on Disposal									8,061	705,247
Write down of certain unconsolidated investments							7,800		8,200	7,800
Dividends paid by the equity investees to the entity									14,960	162,326
Amount payable to the entity's less-than 50% owned companies					1,000		1,500		1,000	1,500
Proceeds from sale of equity investments									7,428	1,621	$ 2,932
Distributions of income from equity investments									7,500	160,707	39,504
Goodwill impairment charge									290,941	0	0	$ 0
Apartments.Com Business
Investments in unconsolidated companies and joint ventures
Gain on sale								$ 144,200
Apartments.Com Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations
Investments in unconsolidated companies and joint ventures
Gain on sale										144,200
Distributions of income from equity investments			$ 146,900
Classified Ventures LLC
Investments in unconsolidated companies and joint ventures
Gain on sale							559,300
Classified Ventures LLC | Disposal Group, Disposed of by Sale, Not Discontinued Operations
Investments in unconsolidated companies and joint ventures
Proceeds from sale	$ 606,200				25,600
Gain on sale				$ 7,500		$ 600	559,300
Proceeds before taxes and escrow	$ 631,800
Escrow Deposit					$ 25,600				25,600
Term of Agreement	5 years
McClatchy Tribune Information Services Member
Investments in unconsolidated companies and joint ventures
Gain on sale								$ 1,700
McClatchy Tribune Information Services Member | Disposal Group, Disposed of by Sale, Not Discontinued Operations
Investments in unconsolidated companies and joint ventures
Gain on sale		$ 1,700
Term of Agreement		10 years
Newswire Content Cost									$ 0
Intangible asset - newswire content		$ 3,100
Career Builder LLC
Investments in unconsolidated companies and joint ventures
Ownership Interest (as a percent)					15.00%				15.00%
Investments in unconsolidated companies					$ 230,170		226,965		$ 230,170	226,965
Dividends paid by the equity investees to the entity									7,500	6,750
Expenses incurred for products provided by the entity's less-than 50% owned companies									$ 1,001	1,024	1,109
Seattle Times Company (C-Corporation)
Investments in unconsolidated companies and joint ventures
Ownership Interest (as a percent)					49.50%				49.50%
Investments in unconsolidated companies					$ 0				$ 0
Ponderay (general partnership)
Investments in unconsolidated companies and joint ventures
Ownership Interest (as a percent)					27.00%				27.00%
Expenses incurred for products provided by the entity's less-than 50% owned companies									$ 8,200	10,433	$ 16,313
Goodwill impairment charge					$ 7,500
Other
Investments in unconsolidated companies and joint ventures
Investments in unconsolidated companies					$ 3,368		$ 3,508		3,368	3,508
Dividends paid by the equity investees to the entity									$ 7,460	$ 155,576
Classified Ventures, LLC Selling Partners | Classified Ventures LLC | Disposal Group, Disposed of by Sale, Not Discontinued Operations
Investments in unconsolidated companies and joint ventures
Proceeds from sale	$ 2,500,000
Classified Ventures LLC | Apartments.Com Business | Disposal Group, Disposed of by Sale, Not Discontinued Operations
Investments in unconsolidated companies and joint ventures
Proceeds from sale			$ 585,000

XML

INVESTMENTS IN UNCONSOLIDATED COMPANIES - Condensed info (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Equity Method Investment, Summarized Financial Information [Abstract]
Current assets	$ 365,993	$ 359,349
Noncurrent assets	540,629	577,837
Current liabilities	236,630	247,825
Noncurrent liabilities	228,209	180,764
Equity	441,783	508,597
Condensed financial information
Net revenues	988,871	1,368,593	$ 1,512,534
Gross profit	843,680	1,155,091	1,262,104
Operating income	38,561	146,809	231,952
Net income	$ 39,143	$ 151,519	$ 247,441

XML

INTANGIBLE ASSETS AND GOODWILL (Details) - USD ($) $ in Thousands		3 Months Ended		12 Months Ended
	May. 07, 2014	Dec. 27, 2015	Dec. 28, 2014	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013	Dec. 30, 2012
Intangible assets subject to amortization, gross
Balance at the beginning of the period				$ 833,254	$ 835,461
Acquired Assets					3,100
Disposition Adjustment					(5,307)
Balance at the end of the period		$ 833,254	$ 833,254	833,254	833,254	$ 835,461
Accumulated amortization
Balance at the beginning of the period				(615,378)	(567,737)
Disposition Adjustment					5,307
Amortization Expense				(48,357)	(52,948)	(57,200)
Balance at the end of the period		(663,735)	(615,378)	(663,735)	(615,378)	(567,737)
Intangible assets subject to amortization, net
Balance at the beginning of the period				217,876	267,724
Finite-lived Intangible Assets Acquired					3,100
Amortization Expense				(48,357)	(52,948)	(57,200)
Intangible assets, net		169,519	217,876	217,876	267,724	267,724
Mastheads
Balance at the beginning of the period				193,039	198,242
Impairment Charges			(5,200)	(13,907)	(5,203)	0
Balance at the end of the period		179,132	193,039	179,132	193,039	198,242
Goodwill [Roll Forward]
Balance at the beginning of the period				996,115	1,013,002
Goodwill impairment charge				(290,941)	0	0	$ 0
Disposition Adjustment					(16,887)
Balance at the end of the period		705,174	996,115	705,174	996,115	1,013,002
Total
Balance at the beginning of the period				1,407,030	1,478,968
Acquired Assets					3,100
Impairment Charges				(304,848)	(5,203)
Amortization Expense				(48,357)	(52,948)	(57,200)
Balance at the end of the period		$ 1,053,825	$ 1,407,030	1,053,825	$ 1,407,030	$ 1,478,968
McClatchy Tribune Information Services Member | Disposal Group, Disposed of by Sale, Not Discontinued Operations
Intangible assets subject to amortization, net
Finite-lived Intangible Assets Acquired	$ 3,100
Total
Term of Agreement	10 years
Newswire Content Cost				$ 0

XML

INTANGIBLE ASSETS AND GOODWILL - Indefinite-lived (Details) - USD ($) $ in Thousands	3 Months Ended			12 Months Ended
	Dec. 27, 2015	Jun. 28, 2015	Dec. 28, 2014	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Indefinite lived intangible assets and goodwill
Goodwill, Gross	$ 3,571,111		$ 3,571,111	$ 3,571,111	$ 3,571,111
Original Gross Amount	4,254,111		4,254,111	4,254,111	4,254,111
Accumulated Impairment, Goodwill	(2,865,937)		(2,574,996)	(2,865,937)	(2,574,996)
Accumulated Impairment, Amount	(3,369,805)		(3,064,957)	(3,369,805)	(3,064,957)
Carrying Amount, Mastheads	179,132		193,039	179,132	193,039	$ 198,242
Goodwill	705,174		996,115	705,174	996,115	1,013,002
Carrying Amount, Total	884,306		1,189,154	884,306	1,189,154
Impairment Charges			(5,200)	(13,907)	(5,203)	$ 0
Newspaper mastheads
Indefinite lived intangible assets and goodwill
Original Gross Amount, Mastheads	683,000		683,000	683,000	683,000
Accumulated Impairment, Mastheads	(503,868)		(489,961)	(503,868)	(489,961)
Carrying Amount, Mastheads	179,132		$ 193,039	$ 179,132	$ 193,039
Impairment Charges	$ (4,400)	$ (9,500)

XML

INTANGIBLE ASSETS AND GOODWILL - Amortization (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
INTANGIBLE ASSETS AND GOODWILL
Amortization expense	$ 48,357	$ 52,948	$ 57,200
Estimated amortization expense
2016	47,986
2017	48,907
2018	47,275
2019	23,769
2020	$ 418

XML

LONG-TERM DEBT (Details) - USD ($) $ in Thousands	Dec. 27, 2015	Dec. 28, 2014
Long-term debt disclosures
Face Value	$ 937,275
Carrying value	905,425	$ 994,812
Total long-term debt, net of current	905,425	994,812
Unamortized discounts	$ 31,900	$ 37,600
9.00% senior secured notes due in 2022
Long-term debt disclosures
Interest rate (as a percent)	9.00%	9.00%
Face Value	$ 516,415
Carrying value	$ 506,571	$ 543,640
5.750% notes due in 2017
Long-term debt disclosures
Interest rate (as a percent)	5.75%	5.75%
Face Value	$ 55,442
Carrying value	$ 54,551	$ 108,489
7.150% debentures due in 2027
Long-term debt disclosures
Interest rate (as a percent)	7.15%	7.15%
Face Value	$ 89,188
Carrying value	$ 84,469	$ 84,076
6.875% debentures due in 2029
Long-term debt disclosures
Interest rate (as a percent)	6.875%	6.875%
Face Value	$ 276,230
Carrying value	$ 259,834	$ 258,607

XML

LONG-TERM DEBT - Notes and Covenants (Details) $ in Thousands		3 Months Ended	12 Months Ended
	Oct. 21, 2014 USD ($)	Dec. 28, 2014 USD ($)	Dec. 27, 2015 USD ($)	Dec. 28, 2014 USD ($)	Dec. 29, 2013 USD ($)	Jan. 31, 2016 USD ($)	Jul. 31, 2013
LONG-TERM DEBT
Face value of notes redeemed or repurchased			$ 95,227	$ 494,200	$ 155,900
Gain (loss) on extinguishment of debt, net		$ (72,800)	1,167	$ (72,777)	$ (13,643)
Notes repurchased privately			95,200
Amendment 21 October 2014
LONG-TERM DEBT
Maximum borrowing capacity			$ 65,000
Revolving credit facility | LIBOR
LONG-TERM DEBT
Variable rate basis			London Interbank Offered Rate
Revolving credit facility | LIBOR | Minimum
LONG-TERM DEBT
Basis spread on variable rate (as a percent)			2.75%
Revolving credit facility | LIBOR | Maximum
LONG-TERM DEBT
Basis spread on variable rate (as a percent)			4.25%
Revolving credit facility | Base rate | Minimum
LONG-TERM DEBT
Basis spread on variable rate (as a percent)			1.75%
Revolving credit facility | Base rate | Maximum
LONG-TERM DEBT
Basis spread on variable rate (as a percent)			3.25%
Revolving credit facility | Amendment 21 October 2014
LONG-TERM DEBT
Outstanding line of credit			$ 0
Maximum consolidated leverage ratio			6.00
Minimum threshold amount of debt used to calculate consolidated total leverage ratio			$ 20,000
Dividends restricted if consolidated leverage ratio is exceeded			5.25
Revolving credit facility | Amendment 21 October 2014 | Minimum
LONG-TERM DEBT
Commitment fees for the unused revolving credit (as a percent)			0.50%
Revolving credit facility | Amendment 21 October 2014 | Maximum
LONG-TERM DEBT
Commitment fees for the unused revolving credit (as a percent)			0.625%
Letter of credit
LONG-TERM DEBT
Maximum borrowing capacity	$ 35,000
Percentage of aggregate undrawn amount of letter of credit required to provide cash collateral	101.00%
Outstanding letters of credit			$ 33,000
Letter of credit | Expected
LONG-TERM DEBT
Outstanding letters of credit						$ 31,000
9.00% Notes
LONG-TERM DEBT
Ownership percentage in each of the guarantor subsidiaries			100.00%
9.00% Notes | Original notes
LONG-TERM DEBT
Interest rate (as a percent)							9.00%
9.00% senior secured notes due in 2022
LONG-TERM DEBT
Interest rate (as a percent)		9.00%	9.00%	9.00%
Face value of notes redeemed or repurchased			$ 39,370
5.750% notes due in 2017
LONG-TERM DEBT
Interest rate (as a percent)		5.75%	5.75%	5.75%
Face value of notes redeemed or repurchased			$ 55,857

XML

LONG-TERM DEBT - Maturities (Details) $ in Thousands	Dec. 27, 2015 USD ($)
Annual maturities of debt for the next five years and thereafter
2017	$ 55,442
Thereafter	881,833
Debt principal	$ 937,275

XML

INCOME TAXES (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Current:
Federal	$ 13,317	$ 233,247	$ 16,100
State	(2,027)	30,216	5,108
Deferred:
Federal	(17,642)	(29,182)	(7,262)
State	(5,445)	(3,051)	(2,287)
Income Tax Expense (Benefit), Total	$ (11,797)	$ 231,230	$ 11,659
Reconciliation of effective tax rate expense (benefit) and the statutory federal income tax rate
Statutory rate (as a percent)	(35.00%)	35.00%	35.00%
State taxes, net of federal benefit (as a percent)	(2.10%)	3.00%	12.30%
Changes in estimates (as a percent)	0.10%
Changes in unrecognized tax benefits (as a percent)	0.30%		(6.00%)
Settlements (as a percent)		(0.10%)	(1.50%)
Other (as a percent)		0.10%	3.10%
Goodwill impairment (as a percent)	32.50%
Stock compensation (as a percent)	0.40%	0.10%	(1.40%)
Effective tax rate (as a percent)	(3.80%)	38.10%	41.50%
Deferred tax assets:
Compensation benefits	$ 233,101	$ 248,585
State taxes	3,586	6,061
State loss carryovers	2,877	2,266
Other	3,765	4,508
Total deferred tax assets	243,329	261,420
Valuation allowance	(2,877)	(2,265)
Net deferred tax assets	240,452	259,155
Net deferred tax assets	1,312
Deferred tax liabilities:
Depreciation and amortization	160,752	195,616
Investments in unconsolidated subsidiaries	50,434	52,711
Debt discount	8,301	9,618
Deferred gain on debt	19,653	26,318
Total deferred tax liabilities	239,140	284,263
Net deferred tax liabilities		25,108
Valuation allowance
Decrease in valuation allowance	$ 600	$ 1,500

XML

INCOME TAXES - Credits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013	Dec. 30, 2012
INCOME TAXES
Operating Loss Carryforwards	$ 196,500
Long-term liabilities relating to uncertain tax positions	18,100
Unrecognized tax benefits	15,621	$ 13,046	$ 12,889	$ 8,649
Gross accrued interest and penalties	2,500
Unrecognized Tax Benefits that Would Impact Effective Tax Rate	8,100
Decreases in unrecognized tax benefits	1,100
Unrecognized Tax Benefits, Interest on Income Taxes Expense	(300)	100	(700)
Unrecognized Tax Benefits, Income Tax Penalties Expense	100	(100)
Net accrued interest and penalties	$ 2,500	$ 2,700	$ 2,700

XML

INCOME TAXES - Unrecognized (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Reconciliation of the beginning and ending amount of unrecognized tax benefits
Balance at beginning of fiscal year	$ 13,046	$ 12,889	$ 8,649
Increases based on tax positions in prior year	4,433	1	7,631
Decreases based on tax positions in prior year		(363)	(935)
Increases based on tax positions in current year	1,435	1,357	1,386
Settlements		(49)	(259)
Lapse of statute of limitations	(3,293)	(789)	(3,583)
Balance at end of fiscal year	$ 15,621	$ 13,046	$ 12,889

XML

EMPLOYEE BENEFITS (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013	Dec. 27, 2015	Dec. 28, 2014
Changes in the fair value of the plan's Level 3 investment assets
Fair value of plan assets, end of year	$ 1,349,603
Funded Status
Fair value of plan assets	1,349,603			$ 1,349,603
Amounts recognized in the statement of financial position consist of:
Noncurrent liability				(581,852)	$ (574,024)
Pension plan
Change in Benefit Obligation
Benefit obligation, beginning of year	2,051,907	$ 1,849,321
Service cost	11,680	8,030	$ 5,545
Interest cost	84,994	91,004	84,596
Actuarial (gain)/loss	(101,952)	213,176
Gross benefits paid	(103,062)	(101,441)
Administrative expenses	(12,247)	(8,183)
Benefit obligation, end of year	1,931,320	2,051,907	1,849,321
Changes in the fair value of the plan's Level 3 investment assets
Fair value of plan assets, beginning of year	1,478,686	1,432,695
Actual return on plan assets	(22,307)	122,133
Employer contribution	8,533	33,482
Gross benefits paid	(103,062)	(101,441)
Administrative expenses	(12,247)	(8,183)
Fair value of plan assets, end of year	1,349,603	1,478,686	1,432,695
Funded Status
Fair value of plan assets	1,478,686	1,432,695	1,432,695	1,349,603	1,478,686
Benefit obligations	(2,051,907)	(1,849,321)	(1,849,321)	(1,931,320)	(2,051,907)
Funded status and amount recognized, end of year				(581,717)	(573,221)
Amounts recognized in the statement of financial position consist of:
Current liability				(8,450)	(8,529)
Noncurrent liability				(573,267)	(564,692)
Amounts recognized in the statement of financial position				(581,717)	(573,221)
Amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss/(gain)				705,853	701,408
Amounts recognized in accumulated other comprehensive income				705,853	701,408
Supplemental retirement plans
Changes in the fair value of the plan's Level 3 investment assets
Employer contribution	8,500	8,500	8,300
Post-retirement plans
Change in Benefit Obligation
Benefit obligation, beginning of year	10,602	12,586
Interest cost	368	514
Plan participants' contributions	35	267
Actuarial (gain)/loss	(87)	467
Gross benefits paid	(1,035)	(1,611)
Plan amendment		(1,621)
Benefit obligation, end of year	9,883	10,602	12,586
Changes in the fair value of the plan's Level 3 investment assets
Employer contribution	1,000	1,344
Plan participants' contributions	35	267
Gross benefits paid	(1,035)	(1,611)
Funded Status
Benefit obligations	$ (10,602)	$ (12,586)	$ (12,586)	(9,883)	(10,602)
Funded status and amount recognized, end of year				(9,883)	(10,602)
Amounts recognized in the statement of financial position consist of:
Current liability				(1,298)	(1,270)
Noncurrent liability				(8,585)	(9,332)
Amounts recognized in the statement of financial position				(9,883)	(10,602)
Amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss/(gain)				(8,568)	(9,385)
Prior service cost/(credit)				(10,690)	(12,768)
Amounts recognized in accumulated other comprehensive income				$ (19,258)	$ (22,153)

XML

EMPLOYEE BENEFITS - Obligation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Change in Benefit Obligation
Net retirement expenses	$ 9,971	$ 4,632	$ 12,162
Pension plan
Change in Benefit Obligation
Service cost	11,680	8,030	5,545
Interest cost	84,994	91,004	84,596
Expected return on plan assets	(106,283)	(107,460)	(101,053)
Prior service cost amortization		12	14
Actuarial loss	22,194	16,009	25,557
Net pension expense	12,585	7,595	14,659
Post-retirement plans
Change in Benefit Obligation
Interest cost	368	514
Net pension expense	$ (2,614)	$ (2,963)	$ (2,497)

XML

EMPLOYEE BENEFITS - Assumptions (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Feb. 29, 2016	Dec. 31, 2016	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Pension plan
Weighted average assumptions used for valuing benefit obligations
Discount rate (as a percent)			4.71%	4.24%
Weighted average assumptions used in calculating expense
Expected long-term return on plan assets (as a percent)			7.75%	8.00%	8.00%
Discount rate (as a percent)			4.24%	5.01%	4.17%
Medical cost trend rates
Value of contributions to plan			$ 8,533	$ 33,482
Contribution				$ 25,000	$ 7,600
Gain or loss recognized on the contribution of property			0
Financing obligation from contribution of real property			32,400
Expected benefit payments
2016			101,524
2017			104,592
2018			107,158
2019			112,402
2020			113,173
2021-2025			612,003
Total			$ 1,150,852
Post-retirement plans
Weighted average assumptions used for valuing benefit obligations
Discount rate (as a percent)			4.21%	3.69%
Weighted average assumptions used in calculating expense
Discount rate (as a percent)			3.69%	4.36%	3.39%
Medical cost trend rates
Value of contributions to plan			$ 1,000	$ 1,344
Expected benefit payments
2016			1,297
2017			1,198
2018			1,105
2019			1,026
2020			942
2021-2025			3,567
Total			$ 9,135
Expected | Pension plan
Medical cost trend rates
Value of contributions to plan	$ 47,100	$ 2,000

XML

EMPLOYEE BENEFITS - Contributions (Details) - Pension plan	12 Months Ended
	Dec. 27, 2015
Equity securities
Contributions and Cash Flows [Line Items]
Target Allocation (as a percent)	61.00%
Debt securities
Contributions and Cash Flows [Line Items]
Target Allocation (as a percent)	33.00%
Real estate
Contributions and Cash Flows [Line Items]
Target Allocation (as a percent)	6.00%
Minimum
Contributions and Cash Flows [Line Items]
Investment horizon of plan assets	10 years

XML

EMPLOYEE BENEFITS - Fair value (Details) - USD ($) $ in Thousands	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
EMPLOYEE BENEFITS
Pending trades	$ 9,003
Fair value of plan assets	1,349,603
Pension plan
EMPLOYEE BENEFITS
Total	1,340,600	$ 1,478,686
Fair value of plan assets	1,349,603	1,478,686	$ 1,432,695
Cash and cash equivalents | Pension plan
EMPLOYEE BENEFITS
Total	844	1,068
Mutual funds | Pension plan
EMPLOYEE BENEFITS
Total	436,316	485,488
Corporate debt instruments | Pension plan
EMPLOYEE BENEFITS
Total	112	106
Common collective trust | Pension plan
EMPLOYEE BENEFITS
Total	845,686	937,809
Real Estate | Pension plan
EMPLOYEE BENEFITS
Total	50,360	47,579
Other | Pension plan
EMPLOYEE BENEFITS
Total	7,282	6,636
Level 1 | Pension plan
EMPLOYEE BENEFITS
Total	437,160	486,556
Level 1 | Cash and cash equivalents | Pension plan
EMPLOYEE BENEFITS
Total	844	1,068
Level 1 | Mutual funds | Pension plan
EMPLOYEE BENEFITS
Total	436,316	485,488
Level 2 | Pension plan
EMPLOYEE BENEFITS
Total	845,798	937,915
Level 2 | Corporate debt instruments | Pension plan
EMPLOYEE BENEFITS
Total	112	106
Level 2 | Common collective trust | Pension plan
EMPLOYEE BENEFITS
Total	845,686	937,809
Level 3 | Pension plan
EMPLOYEE BENEFITS
Total	57,642	54,215	$ 59,432
Level 3 | Real Estate | Pension plan
EMPLOYEE BENEFITS
Total	50,360	47,579
Level 3 | Other | Pension plan
EMPLOYEE BENEFITS
Total	$ 7,282	$ 6,636

XML

EMPLOYEE BENEFITS - Investmt assets (Details) - Pension plan $ in Thousands		12 Months Ended
	Jan. 14, 2011 item	Dec. 27, 2015 USD ($) item	Dec. 28, 2014 USD ($)
Changes in the fair value of the plan's Level 3 investment assets
Fair value of plan assets, beginning of year		$ 1,478,686
Fair value of plan assets, end of year		1,340,600	$ 1,478,686
Additional disclosures on plan assets
Number of locations from which properties were contributed | item	7
Level 3
Changes in the fair value of the plan's Level 3 investment assets
Fair value of plan assets, beginning of year		54,215	59,432
Purchases, issuances, sales, settlements			(3,312)
Realized gains		2,479	(12,180)
Transfer in or out of level 3		(3,936)	(4,456)
Unrealized gains		4,884	14,731
Fair value of plan assets, end of year		57,642	54,215
Real estate | Level 3
Changes in the fair value of the plan's Level 3 investment assets
Fair value of plan assets, beginning of year		47,579	52,265
Purchases, issuances, sales, settlements			(3,312)
Realized gains		2,479	3,973
Transfer in or out of level 3		(3,936)	(3,973)
Unrealized gains		4,238	(1,374)
Fair value of plan assets, end of year		$ 50,360	47,579
Private Equity
Additional disclosures on plan assets
Number of funds closed out | item		2
Private Equity | Level 3
Changes in the fair value of the plan's Level 3 investment assets
Fair value of plan assets, beginning of year		$ 6,636	7,167
Realized gains			(16,153)
Transfer in or out of level 3			(483)
Unrealized gains		646	16,105
Fair value of plan assets, end of year		$ 7,282	$ 6,636

XML

CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Cash paid for interest and income taxes
Interest paid (net of amount capitalized)	$ 80,514	$ 121,375	$ 127,257
Income taxes paid (net of refunds)	207,043	77,622	21,019
Non-cash transactions
Intangible asset - newswire content		3,100
Non-cash financing activities related to purchases of PP&E on credit	$ 500	$ 1,300	200
Sale of land and building
Non-cash transactions
Financing obligations released			238,100
Investing obligations released			$ 227,700

XML

COMMITMENTS AND CONTINGENCIES - Obligations by year (Details) - USD ($) $ in Thousands	Dec. 27, 2015	Dec. 28, 2014
Purchase obligations
2016	$ 19,364
2017	10,035
2018	6,669
2019	5,829
2020	5,031
Thereafter	23,581
Total	70,509
Lease Obligation
2016	11,467
2017	10,146
2018	8,819
2019	7,122
2020	5,219
Thereafter	24,735
Total	67,508
Sublease Income
2016	(3,336)
2017	(2,342)
2018	(1,441)
2019	(1,028)
2020	(611)
Thereafter	(1,748)
Total	(10,506)
Net lease obligations
2016	8,131
2017	7,804
2018	7,378
2019	6,094
2020	4,608
Thereafter	22,987
Total	57,002
Contractual Obligation, Fiscal Year Maturity [Abstract]
2016	31,094
2017	20,264
2018	15,869
2019	13,279
2020	10,684
Thereafter	52,929
Total	144,119
Self-Insurance
Workers' compensation obligations
2016	3,599
2017	2,425
2018	1,822
2019	1,356
2020	1,045
Thereafter	6,361
Total	$ 16,608	$ 18,000

XML

COMMITMENTS AND CONTINGENCIES - Purchases and Leases (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Operating leases
Total rental expense, included in other operating expenses, from continuing operations	$ 11.6	$ 12.5	$ 11.2
Sublease income from operating leases	$ 4.6	$ 2.2	$ 3.9

XML

COMMITMENTS AND CONTINGENCIES - Obligations disclosures (Details) - Self-Insurance - USD ($) $ in Thousands	Dec. 27, 2015	Dec. 28, 2014
Loss Contingencies [Line Items]
Estimated Insurance Recoveries	$ 3,200
Additional disclosures
Undiscounted ultimate losses of all self-insurance reserves related to our workers' compensation liabilities, net of insurance recoveries	$ 16,608	$ 18,000
Discount rate of ultimate losses (as a percent)	1.80%	2.00%
Present value of self-insurance reserves	$ 15,300	$ 17,500

XML

COMMITMENTS AND CONTINGENCIES - Legal Proceedings (Details) $ in Millions	12 Months Ended
	Dec. 27, 2015 USD ($) item
Letter of credit
Additional disclosures
Outstanding letters of credit | $	$ 33.0
"Sacramento Case"
Contingencies
Number of carriers	5,000
Number of phases	3
"Fresno Case"
Contingencies
Number of carriers	3,500
Number of phases	2

XML

COMMON STOCK AND STOCK PLANS (Details)	12 Months Ended
	Dec. 27, 2015 item shares	Dec. 28, 2014 shares
Class of Stock [Line Items]
Number of classes of common stock	2
Minimum number of "Permitted Transferees"	1
Minimum number of lineal descendants of Charles K. McClatchy who owns the beneficial interests of "Permitted Transferees"	1
Common Class A
Class of Stock [Line Items]
Number of votes per share	0.1
Percentage of Board of Directors selected from voting	25.00%
Shares issued in conversion | shares	154,000	215,000
Common Class B
Class of Stock [Line Items]
Number of votes per share	1
Percentage of Board of Directors selected from voting	75.00%
Minimum percentage of common stock outstanding before conversion	25.00%
Vote of the holders as a percentage of outstanding shares required for termination of the agreement	80.00%

XML

COMMON STOCK AND STOCK PLANS - Share Repurchase (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013	Aug. 31, 2015	Apr. 30, 2015
Equity, Class of Treasury Stock [Line Items]
Treasury stock, acquried (in shares)	6,494,482	1,594,115	580,219
Treasury stock, acquired	$ 8,434	$ 7,603	$ 1,793
Share Repurchase Program 2015
Equity, Class of Treasury Stock [Line Items]
Stock repurchase program, authorized amount				$ 15,000	$ 7,000
Treasury stock, acquried (in shares)	6,100,000
Repurchase weighted average price (in dollars per share)	$ 1.28
Treasury stock, acquired	$ 7,800

XML

COMMON STOCK AND STOCK PLANS - Activity and FV (Details) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 27, 2015 USD ($) item $ / shares shares	Dec. 28, 2014 USD ($) $ / shares shares	Dec. 29, 2013 USD ($) $ / shares shares	May. 31, 2012 shares
Stock Plans Activity
Number of stock-based compensation plans | item	2
Options/SARs
Outstanding at the beginning of the period (in shares)	3,848,750	6,110,500	6,194,500
Granted (in shares)			775,000
Exercised (in shares)		(1,678,250)	(545,750)
Forfeited (in shares)	(68,750)	(67,250)	(58,500)
Expired (in shares)	(578,750)	(516,250)	(254,750)
Outstanding at the end of the period (in shares)	3,201,250	3,848,750	6,110,500
Vested and Expected to Vest at the end of the period (in shares)	3,179,366
Options exercisable (in shares)	2,774,125	2,719,750	3,983,875
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share) | $ / shares	$ 9.28	$ 9.69	$ 11.45
Granted (in dollars per share) | $ / shares			2.46
Exercised (in dollars per share) | $ / shares		2.86	1.72
Forfeited (in dollars per share) | $ / shares	2.61	3.38	3.30
Expired (in dollars per share) | $ / shares	20.76	35.74	48.97
Outstanding at the end of the period (in dollars per share) | $ / shares	7.35	$ 9.28	$ 9.69
Vested and Expected to Vest at the end of the period (in dollars per share) | $ / shares	$ 8.09
Aggregate Intrinsic Value
Outstanding at the beginning of the period (in dollars) | $	$ 1,542	$ 2,384	$ 1,846
Exercised (in dollars) | $		3,138	847
Outstanding at the end of the period (in dollars) | $		1,542	2,384
Options exercisable (in dollars) | $		$ 716	$ 1,306
2004 Plan
Stock Plans Activity
Vesting period	4 years
Terms of award	10 years
Stock options and SARs
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized [Abstract]
Unrecognized compensation costs | $	$ 300
Period in which compensation costs will be recognized	1 year 1 month 6 days
Weighted Average Exercise Price
Granted (in dollars per share) | $ / shares			$ 2.46
Stock Appreciation Rights (SARs) [Member]
Stock Plans Activity
Vesting period	4 years
Stock Appreciation Rights (SARs) [Member] | 2012 Plan | Maximum
Stock Plans Activity
Terms of award	10 years
RSUs
Stock Plans Activity
Granted (in shares)	1,365,300	856,950	483,150
RSU's
Nonvested at the beginning of the period (in shares)	1,329,550	1,231,650	1,102,000
Granted (in shares)	1,365,300	856,950	483,150
Vested (in shares)	(970,000)	(717,150)	(320,000)
Forfeited (in shares)	(186,050)	(41,900)	(33,500)
Nonvested at the end of the period (in shares)	1,538,800	1,329,550	1,231,650
Weighted Average Grant Date Fair Value
Outstanding at the beginning of the period (in dollars per share) | $ / shares	$ 3.62	$ 2.50	$ 2.98
Granted (in dollars per share) | $ / shares	2.28	4.61	2.46
Vested (in dollars per share) | $ / shares	2.85	2.92	4.08
Forfeited (in dollars per share) | $ / shares	3.08	2.93	2.48
Outstanding at the end of the period (in dollars per share) | $ / shares	$ 2.98	$ 3.62	$ 2.50
Additional disclosures
Total fair value | $	$ 1,600
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized [Abstract]
Unrecognized compensation costs | $	$ 3,000
Period in which compensation costs will be recognized	1 year 9 months 18 days
RSUs | Maximum
Stock Plans Activity
Vesting period	3 years
Common Class A | 2004 Plan
Stock Plans Activity
Shares reserved for issuance to employees	9,000,000
Common Class A | 2012 Plan
Stock Plans Activity
Outstanding grants (in shares)				5,000,000
Common Class A | Non-employee director | 2012 Plan
Stock Plans Activity
Granted (in shares)	15,000	15,000	15,000
Issued (in shares)	150,000	150,000	165,000
RSU's
Granted (in shares)	15,000	15,000	15,000

XML

COMMON STOCK AND STOCK PLANS - Outstanding Options and SARs (Details) - Stock options and SARs	12 Months Ended
	Dec. 27, 2015 $ / shares shares
Share Based Compensation Shares Authorized under Stock Option and SARs Exercise Price Range Outstanding Options [Abstract]
Number of Options/SARs (in shares) | shares	3,201,250
Average Remaining Contractual Life	3 years 11 months 16 days
Weighted Average Exercise Price (in dollars per share)	$ 7.35
Options/SARs Exercisable
Number of Options/SARs (in shares) | shares	2,774,125
Weighted Average Exercise Price (in dollars per share)	$ 8.09
Weighted average remaining contractual life	3 years 6 months
Weighted average remaining contractual term for fully vested and expected to vest	3 years 6 months
$1.50-$9.07
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, low end of range (in dollars per share)	$ 1.70
Exercise price, high end of range (in dollars per share)	$ 9.07
Share Based Compensation Shares Authorized under Stock Option and SARs Exercise Price Range Outstanding Options [Abstract]
Number of Options/SARs (in shares) | shares	2,426,250
Average Remaining Contractual Life	4 years 8 months 12 days
Weighted Average Exercise Price (in dollars per share)	$ 3.06
Options/SARs Exercisable
Number of Options/SARs (in shares) | shares	1,999,125
Weighted Average Exercise Price (in dollars per share)	$ 3.17
$9.73-$35.94
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, low end of range (in dollars per share)	9.73
Exercise price, high end of range (in dollars per share)	$ 35.94
Share Based Compensation Shares Authorized under Stock Option and SARs Exercise Price Range Outstanding Options [Abstract]
Number of Options/SARs (in shares) | shares	574,000
Average Remaining Contractual Life	1 year 10 months 28 days
Weighted Average Exercise Price (in dollars per share)	$ 13.17
Options/SARs Exercisable
Number of Options/SARs (in shares) | shares	574,000
Weighted Average Exercise Price (in dollars per share)	$ 13.17
$40.95-$73.36
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Exercise price, low end of range (in dollars per share)	40.95
Exercise price, high end of range (in dollars per share)	$ 73.36
Share Based Compensation Shares Authorized under Stock Option and SARs Exercise Price Range Outstanding Options [Abstract]
Number of Options/SARs (in shares) | shares	201,000
Average Remaining Contractual Life	11 months 1 day
Weighted Average Exercise Price (in dollars per share)	$ 42.48
Options/SARs Exercisable
Number of Options/SARs (in shares) | shares	201,000
Weighted Average Exercise Price (in dollars per share)	$ 42.48

XML

COMMON STOCK AND STOCK PLANS - Assumptions (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield (as a percent)
Weighted average exercise price of options/SARs granted (in dollars per share)			$ 2.46
Stock-based compensation expense	$ 3,178	$ 3,479	$ 3,481
Stock options and SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected life			4 years 6 months 4 days
Volatility (as a percent)			1.08%
Risk-free interest rate (as a percent)			0.76%
Weighted average exercise price of options/SARs granted (in dollars per share)			$ 2.46
Weighted average fair value of options/SARs granted (in dollars per share)			$ 1.85

XML

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 27, 2015	Sep. 27, 2015	Jun. 28, 2015	Mar. 29, 2015	Dec. 28, 2014	Sep. 28, 2014	Jun. 29, 2014	Mar. 30, 2014	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013
Selected Quarterly Financial Information [Abstract]
Net Revenues	$ 285,825	$ 251,211	$ 262,360	$ 257,178	$ 310,091	$ 272,899	$ 287,391	$ 276,171	$ 1,056,574	$ 1,146,552	$ 1,214,848
Operating income	36,396	8,389	(288,966)	(1,158)	41,164	18,550	27,307	(4,698)	(245,339)	82,323	120,944
INCOME (LOSS) FROM CONTINUING OPERATIONS	8,830	(1,149)	(296,497)	(11,346)	303,010	(2,619)	91,648	(16,062)	(300,162)	375,977	16,444
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAXES					(368)	(141)	(1,699)	220		(1,988)	2,359
NET INCOME (LOSS)	$ 8,830	$ (1,149)	$ (296,497)	$ (11,346)	$ 302,642	$ (2,760)	$ 89,949	$ (15,842)	$ (300,162)	$ 373,989	$ 18,803
Income (loss) from continuing operations - diluted (in dollars per share)	$ 0.10	$ (0.01)	$ (3.39)	$ (0.13)	$ 3.45	$ (0.03)	$ 1.03	$ (0.18)	$ (3.47)	$ 4.26	$ 0.19
Loss from discontinued operations - diluted (in dollars per share)					(0.01)		(0.01)			(0.03)	0.03
Net income (loss) per share - diluted (in dollars per share)	$ 0.10	$ (0.01)	$ (3.39)	$ (0.13)	$ 3.44	$ (0.03)	$ 1.02	$ (0.18)	$ (3.47)	$ 4.23	$ 0.22

XML

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) - Debt, Tax (Details) - USD ($) $ in Thousands	3 Months Ended				12 Months Ended
	Dec. 27, 2015	Jun. 28, 2015	Dec. 28, 2014	Jun. 29, 2014	Dec. 27, 2015	Dec. 28, 2014	Dec. 29, 2013	Dec. 30, 2012
Debt Instrument [Line Items]
Gains (Losses) on Extinguishment of Debt			$ (72,800)		$ 1,167	$ (72,777)	$ (13,643)
Goodwill impairment charge					290,941	0	0	$ 0
Impairment Charges			5,200		13,907	5,203	$ 0
Write down of certain unconsolidated investments			7,800		$ 8,200	$ 7,800
Newspaper mastheads
Debt Instrument [Line Items]
Impairment Charges	$ 4,400	$ 9,500
McClatchy Tribune Information Services Member
Debt Instrument [Line Items]
Gain on sale				$ 1,700
Apartments.Com Business
Debt Instrument [Line Items]
Gain on sale				$ 144,200
Classified Ventures LLC
Debt Instrument [Line Items]
Gain on sale			$ 559,300

XML

CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN (Details) - Pension plan - Expected $ in Thousands	1 Months Ended	3 Months Ended
	Feb. 29, 2016 USD ($) property	Mar. 27, 2016 USD ($)
Defined Benefit Plan Real Property Contributed Number of Locations | property	6
Lease Term of Contributed Property	11 years
Financing Obligations Not Long Term Debt Current and Noncurrent		$ 47,100
Aggregate Annual Rent Payments On Contributed Property	$ 3,500
Gain or loss recognized on the contribution of property		$ 0
Real Estate
Defined Benefit Plan, Contributions by Employer	$ 47,100