Delaware | 42-0823980 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Large accelerated filer | [ ] | Accelerated filer | [X] | |
Non-accelerated filer | [ ] (Do not check if a smaller reporting company) | Smaller reporting company | [ ] |
Table Of Contents | PAGE | |||
PART I | ||||
Item 1. | ||||
Consolidated Statements of Cash Flows - 39 weeks ended June 30, 2013 and June 24, 2012 | ||||
Item 2. | ||||
Item 3. | ||||
Item 4. | ||||
PART II | ||||
Item 1. | ||||
Item 6. | ||||
(Thousands of Dollars) | June 30 2013 | September 30 2012 | ||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | 11,630 | 13,920 | ||
Accounts receivable, net | 63,881 | 67,925 | ||
Income taxes receivable | — | 7,887 | ||
Inventories | 6,277 | 7,271 | ||
Deferred income taxes | 789 | 789 | ||
Other | 6,219 | 6,241 | ||
Assets of discontinued operations | — | 18,305 | ||
Total current assets | 88,796 | 122,338 | ||
Investments: | ||||
Associated companies | 40,693 | 42,201 | ||
Other | 10,405 | 10,033 | ||
Total investments | 51,098 | 52,234 | ||
Property and equipment: | ||||
Land and improvements | 24,558 | 24,519 | ||
Buildings and improvements | 188,091 | 188,048 | ||
Equipment | 296,623 | 298,300 | ||
Construction in process | 4,541 | 2,369 | ||
513,813 | 513,236 | |||
Less accumulated depreciation | 339,131 | 328,866 | ||
Property and equipment, net | 174,682 | 184,370 | ||
Goodwill | 243,729 | 243,729 | ||
Other intangible assets, net | 418,382 | 447,017 | ||
Postretirement assets, net | 8,516 | 7,551 | ||
Other | 3,827 | 3,897 | ||
Total assets | 989,030 | 1,061,136 |
(Thousands of Dollars and Shares, Except Per Share Data) | June 30 2013 | September 30 2012 | ||
LIABILITIES AND EQUITY | ||||
Current liabilities: | ||||
Current maturities of long-term debt | 11,988 | 11,982 | ||
Accounts payable | 18,499 | 22,434 | ||
Compensation and other accrued liabilities | 35,647 | 38,509 | ||
Income taxes payable | 689 | — | ||
Unearned revenue | 33,848 | 34,850 | ||
Liabilities of discontinued operations | — | 2,536 | ||
Total current liabilities | 100,671 | 110,311 | ||
Long-term debt, net of current maturities | 847,385 | 914,244 | ||
Pension obligations | 61,122 | 68,636 | ||
Postretirement and postemployment benefit obligations | 7,803 | 7,160 | ||
Deferred income taxes | 61,968 | 60,140 | ||
Income taxes payable | 6,240 | 6,062 | ||
Other | 6,470 | 8,639 | ||
Total liabilities | 1,091,659 | 1,175,192 | ||
Equity (deficit): | ||||
Stockholders' equity (deficit): | ||||
Serial convertible preferred stock, no par value; authorized 500 shares; none issued | — | — | ||
Common Stock, $0.01 par value; authorized 120,000 shares; issued and outstanding: | 524 | 523 | ||
June 30, 2013; 52,389 shares; | ||||
September 30, 2012; 52,291 shares | ||||
Class B Common Stock, $2 par value; authorized 30,000 shares; none issued | — | — | ||
Additional paid-in capital | 242,303 | 241,039 | ||
Accumulated deficit | (332,388 | ) | (342,760 | ) |
Accumulated other comprehensive loss | (13,715 | ) | (13,435 | ) |
Total stockholders' deficit | (103,276 | ) | (114,633 | ) |
Non-controlling interests | 647 | 577 | ||
Total deficit | (102,629 | ) | (114,056 | ) |
Total liabilities and deficit | 989,030 | 1,061,136 |
13 Weeks Ended | 39 Weeks Ended | |||||||
(Thousands of Dollars, Except Per Common Share Data) | June 30 2013 | June 24 2012 | June 30 2013 | June 24 2012 | ||||
Operating revenue: | ||||||||
Advertising and marketing services | 113,636 | 120,546 | 349,345 | 370,263 | ||||
Subscription | 43,583 | 42,098 | 133,609 | 128,909 | ||||
Other | 9,800 | 9,101 | 29,323 | 28,305 | ||||
Total operating revenue | 167,019 | 171,745 | 512,277 | 527,477 | ||||
Operating expenses: | ||||||||
Compensation | 62,340 | 67,975 | 192,505 | 205,738 | ||||
Newsprint and ink | 10,471 | 12,366 | 33,357 | 38,600 | ||||
Other operating expenses | 53,461 | 51,317 | 160,929 | 157,138 | ||||
Depreciation | 5,215 | 5,811 | 16,146 | 17,755 | ||||
Amortization of intangible assets | 9,542 | 10,438 | 28,635 | 31,982 | ||||
Workforce adjustments | 945 | 2,404 | 2,260 | 3,171 | ||||
Total operating expenses | 141,974 | 150,311 | 433,832 | 454,384 | ||||
Equity in earnings of associated companies | 1,893 | 1,762 | 6,671 | 6,003 | ||||
Operating income | 26,938 | 23,196 | 85,116 | 79,096 | ||||
Non-operating income (expense): | ||||||||
Financial income | 134 | 3 | 219 | 113 | ||||
Interest expense | (21,991 | ) | (24,468 | ) | (68,390 | ) | (57,533 | ) |
Debt financing costs | (468 | ) | (42 | ) | (557 | ) | (2,780 | ) |
Other, net | 520 | — | 7,466 | — | ||||
Total non-operating expense, net | (21,805 | ) | (24,507 | ) | (61,262 | ) | (60,200 | ) |
Income (loss) before reorganization costs and income taxes | 5,133 | (1,311 | ) | 23,854 | 18,896 | |||
Reorganization costs | — | (250 | ) | — | 37,617 | |||
Income (loss) before income taxes | 5,133 | (1,061 | ) | 23,854 | (18,721 | ) | ||
Income tax expense (benefit) | 3,165 | (119 | ) | 11,805 | (6,002 | ) | ||
Income (loss) from continuing operations | 1,968 | (942 | ) | 12,049 | (12,719 | ) | ||
Discontinued operations, net of income taxes | — | (412 | ) | (1,247 | ) | (553 | ) | |
Net income (loss) | 1,968 | (1,354 | ) | 10,802 | (13,272 | ) | ||
Net income attributable to non-controlling interests | (173 | ) | (119 | ) | (430 | ) | (272 | ) |
Income (loss) attributable to Lee Enterprises, Incorporated | 1,795 | (1,473 | ) | 10,372 | (13,544 | ) | ||
Other comprehensive income (loss), net of income taxes | (93 | ) | 152 | (280 | ) | 456 | ||
Comprehensive income (loss) attributable to Lee Enterprises, Incorporated | 1,702 | (1,321 | ) | 10,092 | (13,088 | ) | ||
Income (loss) from continuing operations attributable to Lee Enterprises, Incorporated | 1,795 | (1,061 | ) | 11,619 | (12,991 | ) | ||
Earnings (loss) per common share: | ||||||||
Basic: | ||||||||
Continuing operations | 0.03 | (0.02 | ) | 0.22 | (0.27 | ) | ||
Discontinued operations | — | (0.01 | ) | (0.02 | ) | (0.01 | ) | |
0.03 | (0.03 | ) | 0.20 | (0.28 | ) | |||
Diluted: | ||||||||
Continuing operations | 0.03 | (0.02 | ) | 0.22 | (0.27 | ) | ||
Discontinued operations | — | (0.01 | ) | (0.02 | ) | (0.01 | ) | |
0.03 | (0.03 | ) | 0.20 | (0.28 | ) |
39 Weeks Ended | ||||
(Thousands of Dollars) | June 30 2013 | June 24 2012 | ||
Cash provided by operating activities: | ||||
Net income (loss) | 10,802 | (13,272 | ) | |
Results of discontinued operations | (1,247 | ) | (553 | ) |
Income (loss) from continuing operations | 12,049 | (12,719 | ) | |
Adjustments to reconcile income (loss) from continuing operations to net cash provided by operating activities of continuing operations: | ||||
Depreciation and amortization | 44,781 | 49,737 | ||
Amortization of debt present value adjustment | 3,932 | 2,557 | ||
Stock compensation expense | 1,109 | 802 | ||
Distributions greater than earnings of MNI | 1,342 | 347 | ||
Deferred income tax expense (benefit) | 2,022 | (16,092 | ) | |
Debt financing costs | 527 | 2,805 | ||
Reorganization costs | — | 37,617 | ||
Gain on sale of investments | (7,093 | ) | — | |
Changes in operating assets and liabilities: | ||||
Decrease in receivables | 4,044 | 1,964 | ||
Decrease in inventories and other | 409 | 644 | ||
Increase (decrease) in accounts payable, compensation and other accrued liabilities and unearned revenue | (6,946 | ) | 1,444 | |
Decrease in pension, postretirement and postemployment benefit obligations | (8,310 | ) | (5,164 | ) |
Change in income taxes receivable or payable | 9,423 | 9,930 | ||
Other, net | (1,237 | ) | (2,006 | ) |
Net cash provided by operating activities of continuing operations | 56,052 | 71,866 | ||
Cash provided by (required for) investing activities of continuing operations: | ||||
Purchases of property and equipment | (6,835 | ) | (4,612 | ) |
Decrease in restricted cash | — | 4,972 | ||
Proceeds from sales of assets | 7,615 | 1,546 | ||
Distributions greater than earnings of TNI | 166 | 910 | ||
Other, net | (330 | ) | (500 | ) |
Net cash provided by investing activities of continuing operations | 616 | 2,316 | ||
Cash provided by (required for) financing activities of continuing operations: | ||||
Proceeds from long-term debt | 94,000 | 1,004,795 | ||
Payments on long-term debt | (166,350 | ) | (1,055,305 | ) |
Debt financing and reorganization costs paid | (766 | ) | (31,334 | ) |
Common stock transactions, net | 21 | — | ||
Net cash required for financing activities of continuing operations | (73,095 | ) | (81,844 | ) |
Net cash provided by (required for) discontinued operations | ||||
Operating activities | (552 | ) | 27 | |
Investing activities | 14,689 | 3,256 | ||
Net decrease in cash and cash equivalents | (2,290 | ) | (4,379 | ) |
Cash and cash equivalents: | ||||
Beginning of period | 13,920 | 23,555 | ||
End of period | 11,630 | 19,176 |
1 | BASIS OF PRESENTATION |
(Thousands of Dollars) | February 28 2013 | ||
Current assets | 433 | ||
Property and equipment, net | 770 | ||
Goodwill | 500 | ||
Other intangible assets, net | 4,025 | ||
Current liabilities | (271 | ) | |
Assets, net | 5,457 |
(Thousands of Dollars) | September 30 2012 | ||
Current assets | 2,093 | ||
Property and equipment, net | 5,158 | ||
Goodwill | 3,042 | ||
Other intangible assets, net | 1,920 | ||
Current liabilities | (1,714 | ) | |
Assets, net | 10,499 |
13 Weeks Ended | 39 Weeks Ended | ||||||
(Thousands of Dollars) | June 24 2012 | June 30 2013 | June 24 2012 | ||||
Operating revenue | 7,563 | 1,321 | 23,650 | ||||
Costs and expenses | (8,197 | ) | (1,697 | ) | (24,501 | ) | |
Gain on sale of the North County Times | — | 1,800 | — | ||||
Loss on sale of The Garden Island | — | (3,340 | ) | — | |||
Loss from discontinued operations, before income taxes | (634 | ) | (1,916 | ) | (851 | ) | |
Income tax benefit | (222 | ) | (669 | ) | (298 | ) | |
Net loss | (412 | ) | (1,247 | ) | (553 | ) |
13 Weeks Ended | 40 Weeks Ended | 39 Weeks Ended | |||||||
(Thousands of Dollars) | June 30 2013 | June 24 2012 | June 30 2013 | June 24 2012 | |||||
Operating revenue | 14,644 | 14,155 | 48,110 | 45,878 | |||||
Operating expenses, excluding workforce adjustments, depreciation and amortization | 12,300 | 11,986 | 39,051 | 37,926 | |||||
Workforce adjustments | — | 33 | — | (31 | ) | ||||
Operating income | 2,344 | 2,136 | 9,059 | 7,983 | |||||
Company's 50% share of operating income | 1,172 | 1,068 | 4,530 | 3,992 | |||||
Less amortization of intangible assets | 155 | 181 | 517 | 542 | |||||
Equity in earnings of TNI | 1,017 | 887 | 4,013 | 3,450 |
13 Weeks Ended | 39 Weeks Ended | ||||||||
(Thousands of Dollars) | June 30 2013 | June 24 2012 | June 30 2013 | June 24 2012 | |||||
Operating revenue | 16,046 | 17,215 | 50,084 | 52,845 | |||||
Operating expenses, excluding workforce adjustments, depreciation and amortization | 12,773 | 13,993 | 40,450 | 43,440 | |||||
Workforce adjustments | 74 | (6 | ) | 63 | 22 | ||||
Depreciation and amortization | 383 | 424 | 1,147 | 1,271 | |||||
Operating income | 2,816 | 2,804 | 8,424 | 8,112 | |||||
Net income | 1,754 | 1,748 | 5,249 | 5,106 | |||||
Equity in earnings of MNI | 876 | 874 | 2,658 | 2,553 |
4 | GOODWILL AND OTHER INTANGIBLE ASSETS |
39 Weeks Ended | |||
(Thousands of Dollars) | June 30 2013 | ||
Goodwill, gross amount | 1,536,000 | ||
Accumulated impairment losses | (1,288,729 | ) | |
Goodwill, beginning of period, as previously reported | 247,271 | ||
Goodwill allocated to discontinued operations | (3,542 | ) | |
Goodwill, beginning of period, as reclassified | 243,729 | ||
Goodwill, end of period | 243,729 |
(Thousands of Dollars) | June 30 2013 | September 30 2012 | |||
Nonamortized intangible assets: | |||||
Mastheads | 28,605 | 28,605 | |||
Amortizable intangible assets: | |||||
Customer and newspaper subscriber lists | 855,773 | 855,773 | |||
Less accumulated amortization | 466,000 | 437,366 | |||
389,773 | 418,407 | ||||
Noncompete and consulting agreements | 28,524 | 28,524 | |||
Less accumulated amortization | 28,520 | 28,519 | |||
4 | 5 | ||||
418,382 | 447,017 |
5 | DEBT |
13 Weeks Ended | 13 Weeks Ending | ||||||||
(Thousands of Dollars) | December 30 2012 | March 31 2013 | June 30 2013 | September 29 2013 | |||||
Mandatory | 2,500 | 2,500 | 3,000 | 3,000 | |||||
Voluntary | 9,750 | 15,350 | 2,260 | — | |||||
Asset sales | 7,750 | — | 240 | — | |||||
Excess cash flow | — | — | — | — | |||||
20,000 | 17,850 | 5,500 | 3,000 |
13 Weeks Ended | 14 Weeks Ended | |||||||
(Thousands of Dollars) | March 25 2012 | June 24 2012 | September 30 2012 | |||||
Mandatory | — | 2,500 | 2,500 | |||||
Voluntary | 12,600 | 3,850 | 3,000 | |||||
Asset sales | 2,410 | 150 | 650 | |||||
Excess cash flow | — | — | — | |||||
15,010 | 6,500 | 6,150 |
13 Weeks Ended | 13 Weeks Ending | ||||||||
(Thousands of Dollars) | December 30 2012 | March 31 2013 | June 30 2013 | September 29 2013 | |||||
Mandatory | 3,800 | 2,600 | — | — | |||||
Voluntary | — | 1,500 | 14,000 | — | |||||
Asset sales | 5,200 | 1,900 | — | — | |||||
Excess cash flow | — | — | — | — | |||||
9,000 | 6,000 | 14,000 | — |
13 Weeks Ended | 14 Weeks Ended | ||||||||
(Thousands of Dollars) | December 25 2011 | March 25 2012 | June 24 2012 | September 30 2012 | |||||
Prior to 2012 refinancing | 500 | — | — | — | |||||
Pursuant to the Plan, net | 10,145 | 1,500 | — | — | |||||
Mandatory | — | 1,400 | — | — | |||||
Voluntary | — | 8,955 | 3,000 | 4,000 | |||||
Asset sales | — | — | — | — | |||||
Excess cash flow | — | — | — | — | |||||
10,645 | 11,855 | 3,000 | 4,000 |
(Thousands of Dollars) | ||||
Fees paid in cash to lenders, attorneys and others | 38,628 | |||
Unamortized loan fees from previous debt agreements | 1,740 | |||
Fair value of stock granted to 2nd Lien Lenders | 9,576 | |||
Noncash fees paid in the form of additional debt | 12,250 | |||
Present value adjustment | (23,709 | ) | ||
38,485 | ||||
Charged to expense in 2012 | 37,765 | |||
Charged to expense in 2011 as other non-operating expense | 720 |
Interest Rates (%) | ||||||
(Thousands of Dollars) | June 30 2013 | September 30 2012 | June 30 2013 | |||
Revolving credit facility | — | — | 6.75 | |||
1st Lien Agreement | 618,500 | 661,850 | 7.50 | |||
2nd Lien Agreement | 175,000 | 175,000 | 15.00 | |||
New Pulitzer Notes | 80,000 | — | 9.00 | |||
Pulitzer Notes | — | 109,000 | — | |||
Unamortized present value adjustment | (14,127 | ) | (19,624 | ) | ||
859,373 | 926,226 | |||||
Less current maturities of long-term debt | 16,775 | 17,400 | ||||
Current amount of present value adjustment | (4,787 | ) | (5,418 | ) | ||
Total long-term debt | 847,385 | 914,244 |
6 | PENSION, POSTRETIREMENT AND POSTEMPLOYMENT DEFINED BENEFIT PLANS |
PENSION PLANS | 13 Weeks Ended | 39 Weeks Ended | |||||||
(Thousands of Dollars) | June 30 2013 | June 24 2012 | June 30 2013 | June 24 2012 | |||||
Service cost for benefits earned during the period | 54 | 7 | 162 | 21 | |||||
Interest cost on projected benefit obligation | 1,882 | 1,994 | 5,646 | 5,982 | |||||
Expected return on plan assets | (2,459 | ) | (2,223 | ) | (7,377 | ) | (6,669 | ) | |
Amortization of net loss | 572 | 593 | 1,716 | 1,779 | |||||
Amortization of prior service benefit | (34 | ) | (34 | ) | (102 | ) | (102 | ) | |
15 | 337 | 45 | 1,011 | ||||||
POSTRETIREMENT MEDICAL PLANS | 13 Weeks Ended | 39 Weeks Ended | |||||||
(Thousands of Dollars) | June 30 2013 | June 24 2012 | June 30 2013 | June 24 2012 | |||||
Service cost for benefits earned during the period | 182 | 182 | 546 | 546 | |||||
Interest cost on projected benefit obligation | 281 | 277 | 843 | 831 | |||||
Expected return on plan assets | (368 | ) | (532 | ) | (1,104 | ) | (1,596 | ) | |
Amortization of net gain | (331 | ) | (613 | ) | (993 | ) | (1,839 | ) | |
Amortization of prior service benefit | (365 | ) | (365 | ) | (1,095 | ) | (1,095 | ) | |
(601 | ) | (1,051 | ) | (1,803 | ) | (3,153 | ) |
7 | INCOME TAXES |
13 Weeks Ended | 39 Weeks Ended | ||||||||
(Percent of Income Before Income Taxes) | June 30 2013 | June 24 2012 | June 30 2013 | June 24 2012 | |||||
Computed “expected” income tax expense (benefit) | 35.0 | (35.0 | ) | 35.0 | (35.0 | ) | |||
State income taxes (benefit), net of federal tax effect | 3.5 | (3.3 | ) | 3.4 | (3.3 | ) | |||
Dividends received deductions and credits | (8.4 | ) | 5.9 | (5.9 | ) | (3.0 | ) | ||
Domestic production deduction | 3.4 | — | 3.4 | — | |||||
Reorganization costs | — | 4.0 | — | 4.9 | |||||
Valuation allowance | (1.8 | ) | — | 4.2 | (0.5 | ) | |||
Resolution of tax matters | 5.0 | 22.8 | 2.6 | 4.2 | |||||
Deferred income tax rate adjustments | 22.1 | (3.0 | ) | 4.8 | (1.6 | ) | |||
Other | 2.9 | (2.6 | ) | 2.0 | 2.2 | ||||
61.7 | (11.2 | ) | 49.5 | (32.1 | ) |
8 | EARNINGS (LOSS) PER COMMON SHARE |
13 Weeks Ended | 39 Weeks Ended | ||||||||
(Thousands of Dollars and Shares, Except Per Share Data) | June 30 2013 | June 24 2012 | June 30 2013 | June 24 2012 | |||||
Income (loss) attributable to Lee Enterprises, Incorporated: | |||||||||
Continuing operations | 1,795 | (1,061 | ) | 11,619 | (12,991 | ) | |||
Discontinued operations | — | (412 | ) | (1,247 | ) | (553 | ) | ||
1,795 | (1,473 | ) | 10,372 | (13,544 | ) | ||||
Weighted average common shares | 52,325 | 51,731 | 52,305 | 48,733 | |||||
Less non-vested restricted Common Stock | 500 | — | 500 | — | |||||
Basic average common shares | 51,825 | 51,731 | 51,805 | 48,733 | |||||
Dilutive stock options and restricted Common Stock | 213 | — | 107 | — | |||||
Diluted average common shares | 52,038 | 51,731 | 51,912 | 48,733 | |||||
Earnings (loss) per common share: | |||||||||
Basic: | |||||||||
Continuing operations | 0.03 | (0.02 | ) | 0.22 | (0.27 | ) | |||
Discontinued operations | — | (0.01 | ) | (0.02 | ) | (0.01 | ) | ||
0.03 | (0.03 | ) | 0.20 | (0.28 | ) | ||||
Diluted: | |||||||||
Continuing operations | 0.03 | (0.02 | ) | 0.22 | (0.27 | ) | |||
Discontinued operations | — | (0.01 | ) | (0.02 | ) | (0.01 | ) | ||
0.03 | (0.03 | ) | 0.20 | (0.28 | ) |
9 | STOCK OWNERSHIP PLANS |
(Thousands of Dollars and Shares, Except Per Share Data) | Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value | ||||
Outstanding, September 30, 2012 | 3,102 | 3.18 | ||||||
Granted | 51 | 1.20 | ||||||
Exercised | (18 | ) | 1.13 | |||||
Cancelled | (281 | ) | 5.67 | |||||
Outstanding, June 30, 2013 | 2,854 | 2.91 | 7.6 | 1,211 | ||||
Exercisable, June 30, 2013 | 1,487 | 4.18 | 6.8 | 328 |
(Thousands of Shares, Except Per Share Data) | Shares | Weighted Average Grant Date Fair Value | |||
Outstanding, September 30, 2012 | 500 | 1.31 | |||
Outstanding, June 30, 2013 | 500 | 1.31 |
10 | FAIR VALUE MEASUREMENTS |
(Thousands of Dollars) | June 30 2013 | September 30 2012 | ||
Level 3 - Herald Value - liability | 300 | 300 |
11 | COMMITMENTS AND CONTINGENT LIABILITIES |
12 | COMMON STOCK |
13 Weeks Ended | ||||||||
(Thousands of Dollars) | June 30 2013 | Percent of Revenue | June 24 2012 | Percent of Revenue | ||||
Operating cash flow | 39,802 | 23.8 | 37,683 | 21.9 | ||||
Depreciation and amortization | (14,757 | ) | (8.8 | ) | (16,249 | ) | (9.5 | ) |
Equity in earnings of associated companies | 1,893 | 1.1 | 1,762 | 1.0 | ||||
Operating income | 26,938 | 16.1 | 23,196 | 13.5 |
39 Weeks Ended | ||||||||
(Thousands of Dollars) | June 30 2013 | Percent of Revenue | June 24 2012 | Percent of Revenue | ||||
Operating cash flow | 123,226 | 24.1 | 122,830 | 23.3 | ||||
Depreciation and amortization | (44,781 | ) | (8.7 | ) | (49,737 | ) | (9.4 | ) |
Equity in earnings of associated companies | 6,671 | 1.3 | 6,003 | 1.1 | ||||
Operating income | 85,116 | 16.6 | 79,096 | 15.0 |
• | 50 daily and 38 Sunday newspapers with subscribers totaling 1.1 million and 1.4 million, respectively, for the 13 weeks ended June 30, 2013, read by nearly four million people in print; |
• | Websites and mobile and tablet products in all of our markets that complement our newspapers and attracted 20.8 million unique visitors in June 2013, with 188.5 million page views; and |
• | Nearly 300 weekly newspapers and classified and niche publications. |
13 Weeks Ended | ||||||
(Thousands of Dollars, Except Per Share Data) | June 30 2013 | June 24 2012 | Percent Change | |||
Operating revenue: | ||||||
Retail | 70,944 | 74,049 | (4.2 | ) | ||
Classified: | ||||||
Employment | 8,824 | 9,929 | (11.1 | ) | ||
Automotive | 8,417 | 9,540 | (11.8 | ) | ||
Real estate | 4,864 | 4,990 | (2.5 | ) | ||
All other | 12,491 | 13,320 | (6.2 | ) | ||
Total classified | 34,596 | 37,779 | (8.4 | ) | ||
National | 4,997 | 5,874 | (14.9 | ) | ||
Niche publications and other | 3,099 | 2,844 | 9.0 | |||
Total advertising and marketing services revenue | 113,636 | 120,546 | (5.7 | ) | ||
Subscription | 43,583 | 42,098 | 3.5 | |||
Commercial printing | 3,258 | 3,368 | (3.3 | ) | ||
Digital services and other | 6,542 | 5,733 | 14.1 | |||
Total operating revenue | 167,019 | 171,745 | (2.8 | ) | ||
Operating expenses: | ||||||
Compensation | 62,340 | 67,975 | (8.3 | ) | ||
Newsprint and ink | 10,471 | 12,366 | (15.3 | ) | ||
Other operating expenses | 53,461 | 51,317 | 4.2 | |||
Workforce adjustments | 945 | 2,404 | (60.7 | ) | ||
127,217 | 134,062 | (5.1 | ) | |||
Operating cash flow | 39,802 | 37,683 | 5.6 | |||
Depreciation and amortization | 14,757 | 16,249 | (9.2 | ) | ||
Equity in earnings of associated companies | 1,893 | 1,762 | 7.4 | |||
Operating income | 26,938 | 23,196 | 16.1 | |||
Non-operating expense, net | (21,805 | ) | (24,507 | ) | (11.0 | ) |
Income (loss) from continuing operations before reorganization costs and income taxes | 5,133 | (1,311 | ) | NM | ||
Reorganization costs | — | (250 | ) | NM | ||
Income (loss) from continuing operations before income taxes | 5,133 | (1,061 | ) | NM | ||
Income tax expense (benefit) | 3,165 | (119 | ) | NM | ||
Income (loss) from continuing operations | 1,968 | (942 | ) | NM | ||
Discontinued operations, net of income taxes | — | (412 | ) | NM | ||
Net income (loss) | 1,968 | (1,354 | ) | NM | ||
Net income attributable to non-controlling interests | (173 | ) | (119 | ) | 45.4 | |
Income (loss) attributable to Lee Enterprises, Incorporated | 1,795 | (1,473 | ) | NM | ||
Other comprehensive income (loss), net of income taxes | (93 | ) | 152 | NM | ||
Comprehensive income (loss) attributable to Lee Enterprises, Incorporated | 1,702 | (1,321 | ) | NM | ||
Income (loss) from continuing operations attributable to Lee Enterprises, Incorporated | 1,795 | (1,061 | ) | NM | ||
Income (loss) per common share: | ||||||
Basic | 0.03 | (0.03 | ) | NM | ||
Diluted | 0.03 | (0.03 | ) | NM |
13 Weeks Ended | ||||||||
June 30 2013 | June 24 2012 | |||||||
(Thousands of Dollars, Except Per Share Data) | Amount | Per Share | Amount | Per Share | ||||
Income (loss) attributable to Lee Enterprises, Incorporated, as reported | 1,795 | 0.03 | (1,473 | ) | (0.03 | ) | ||
Adjustments: | ||||||||
Debt financing and reorganization costs | 468 | (208 | ) | |||||
Amortization of debt present value adjustment | 1,216 | 1,387 | ||||||
Other, net | 544 | 2,975 | ||||||
2,228 | 4,154 | |||||||
Income tax effect of adjustments, net | (763 | ) | (1,454 | ) | ||||
1,465 | 0.03 | 2,700 | 0.05 | |||||
Unusual matters related to discontinued operations | — | — | 272 | 0.01 | ||||
Income attributable to Lee Enterprises, Incorporated, as adjusted | 3,260 | 0.06 | 1,499 | 0.03 |
39 Weeks Ended | ||||||
(Thousands of Dollars, Except Per Share Data) | June 30 2013 | June 24 2012 | Percent Change | |||
Operating revenue: | ||||||
Retail | 221,107 | 229,323 | (3.6 | ) | ||
Classified: | ||||||
Employment | 25,165 | 27,309 | (7.9 | ) | ||
Automotive | 26,039 | 29,047 | (10.4 | ) | ||
Real estate | 13,941 | 15,215 | (8.4 | ) | ||
All other | 35,634 | 37,594 | (5.2 | ) | ||
Total classified | 100,779 | 109,165 | (7.7 | ) | ||
National | 18,373 | 23,125 | (20.5 | ) | ||
Niche publications and other | 9,086 | 8,650 | 5.0 | |||
Total advertising and marketing services revenue | 349,345 | 370,263 | (5.6 | ) | ||
Subscription | 133,609 | 128,909 | 3.6 | |||
Commercial printing | 9,681 | 9,390 | 3.1 | |||
Digital services and other | 19,642 | 18,915 | 3.8 | |||
Total operating revenue | 512,277 | 527,477 | (2.9 | ) | ||
Operating expenses: | ||||||
Compensation | 192,505 | 205,738 | (6.4 | ) | ||
Newsprint and ink | 33,357 | 38,600 | (13.6 | ) | ||
Other operating expenses | 160,929 | 157,138 | 2.4 | |||
Workforce adjustments | 2,260 | 3,171 | (28.7 | ) | ||
389,051 | 404,647 | (3.9 | ) | |||
Operating cash flow | 123,226 | 122,830 | 0.3 | |||
Depreciation and amortization | 44,781 | 49,737 | (10.0 | ) | ||
Equity in earnings of associated companies | 6,671 | 6,003 | 11.1 | |||
Operating income | 85,116 | 79,096 | 7.6 | |||
Non-operating expense, net | (61,262 | ) | (60,200 | ) | 1.8 | |
Income from continuing operations before reorganization costs and income taxes | 23,854 | 18,896 | 26.2 | |||
Reorganization costs | — | 37,617 | NM | |||
Income (loss) from continuing operations before income taxes | 23,854 | (18,721 | ) | NM | ||
Income tax expense (benefit) | 11,805 | (6,002 | ) | NM | ||
Income (loss) from continuing operations | 12,049 | (12,719 | ) | NM | ||
Discontinued operations, net of income taxes | (1,247 | ) | (553 | ) | NM | |
Net income (loss) | 10,802 | (13,272 | ) | NM | ||
Net income attributable to non-controlling interests | (430 | ) | (272 | ) | 58.1 | |
Income (loss) attributable to Lee Enterprises, Incorporated | 10,372 | (13,544 | ) | NM | ||
Other comprehensive income (loss), net of income taxes | (280 | ) | 456 | NM | ||
Comprehensive income (loss) attributable to Lee Enterprises, Incorporated | 10,092 | (13,088 | ) | NM | ||
Income (loss) from continuing operations attributable to Lee Enterprises, Incorporated | 11,619 | (12,991 | ) | NM | ||
Earnings (loss) per common share: | ||||||
Basic | 0.20 | (0.28 | ) | NM | ||
Diluted | 0.20 | (0.28 | ) | NM |
39 Weeks Ended | ||||||||
June 30 2013 | June 24 2012 | |||||||
(Thousands of Dollars, Except Per Share Data) | Amount | Per Share | Amount | Per Share | ||||
Income (loss) attributable to Lee Enterprises, Incorporated, as reported | 10,372 | 0.20 | (13,544 | ) | (0.28 | ) | ||
Adjustments: | ||||||||
Debt financing and reorganization costs | 557 | 40,397 | ||||||
Amortization of debt present value adjustment | 3,932 | 2,557 | ||||||
Gain on sale of investment, net | (6,909 | ) | — | |||||
Other, net | 2,170 | 3,717 | ||||||
(250 | ) | 46,671 | ||||||
Income tax effect of adjustments, net | 102 | (16,457 | ) | |||||
(148 | ) | — | 30,214 | 0.62 | ||||
Unusual matters related to discontinued operations | 1,014 | 0.02 | 345 | 0.01 | ||||
Income attributable to Lee Enterprises, Incorporated, as adjusted | 11,238 | 0.22 | 17,015 | 0.35 |
Interest Rates (%) | ||||||
(Thousands of Dollars) | June 30 2013 | September 30 2012 | June 30 2013 | |||
Revolving credit facility | — | — | 6.75 | |||
1st Lien Agreement | 618,500 | 661,850 | 7.50 | |||
2nd Lien Agreement | 175,000 | 175,000 | 15.00 | |||
New Pulitzer Notes | 80,000 | — | 9.00 | |||
Pulitzer Notes | — | 109,000 | — | |||
Unamortized present value adjustment | (14,127 | ) | (19,624 | ) | ||
859,373 | 926,226 | |||||
Less current maturities of debt | 16,775 | 17,400 | ||||
Current amount of present value adjustment | (4,787 | ) | (5,418 | ) | ||
Total long-term debt | 847,385 | 914,244 |
Number | Description | |
31.1 | Rule 13a-14(a)/15d-14(a) certification | |
31.2 | Rule 13a-14(a)/15d-14(a) certification | |
32 | Section 1350 certification |
LEE ENTERPRISES, INCORPORATED | ||
/s/ Carl G. Schmidt | August 9, 2013 | |
Carl G. Schmidt | ||
Vice President, Chief Financial Officer and Treasurer | ||
(Principal Financial and Accounting Officer) |
1 | I have reviewed this quarterly report on Form 10-Q ("Quarterly Report") of Lee Enterprises, Incorporated ("Registrant"); | ||
2 | Based on my knowledge, this Quarterly 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 Quarterly Report; | ||
3 | Based on my knowledge, the Consolidated Financial Statements, and other financial information included in this Quarterly 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 Quarterly Report; | ||
4 | The Registrant's other certifying officer 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 Quarterly 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 Quarterly Report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this Quarterly Report based on such evaluation; and | ||
d) | disclosed in this Quarterly 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 officer 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 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. |
/s/ Mary E. Junck | |
Mary E. Junck | |
Chairman, President and Chief Executive Officer |
1 | I have reviewed this quarterly report on Form 10-Q ("Quarterly Report") of Lee Enterprises, Incorporated ("Registrant"); | ||
2 | Based on my knowledge, this Quarterly 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 Quarterly Report; | ||
3 | Based on my knowledge, the Consolidated Financial Statements, and other financial information included in this Quarterly 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 Quarterly Report; | ||
4 | The Registrant's other certifying officer 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 Quarterly 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 Quarterly Report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this Quarterly Report based on such evaluation; and | ||
d) | disclosed in this Quarterly 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 officer 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 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. |
/s/ Carl G. Schmidt | |
Carl G. Schmidt | |
Vice President, Chief Financial Officer and Treasurer |
(i) | this quarterly report on Form 10-Q for the period ended June 30, 2013 ("Quarterly Report"), fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and | |
(ii) | the information contained in this Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of Lee Enterprises, Incorporated for the periods presented in the Quarterly Report. |
/s/ Mary E. Junck | /s/ Carl G. Schmidt | |
Mary E. Junck | Carl G. Schmidt | |
Chairman, President and | Vice President, Chief Financial Officer | |
Chief Executive Officer | and Treasurer |
Common Stock and Class B Common Stock
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9 Months Ended |
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Jun. 30, 2013
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Common Stock And Class B Common Stock [Abstract] | |
Schedule of Stock by Class [Text Block] | COMMON STOCK Under the Plan, the par value of our Common Stock was changed from $2.00 per share to $0.01 per share effective January 30, 2012. 2nd Lien Lenders shared in the issuance of 6,743,640 shares of our Common Stock, an amount equal to 13% of outstanding shares on a pro forma basis as of January 30, 2012. As of July 1, 2011, our Common Stock traded at an average 30-day closing market price of less than $1 per share. Under the New York Stock Exchange ("NYSE") listing standards, if our Common Stock fails to maintain an adequate per share price and total market capitalization of less than $50,000,000, our Common Stock could be removed from the NYSE and traded in the over-the-counter market. In July 2011, the NYSE first notified us that our Common Stock did not meet the NYSE continued listing standards due to the failure to maintain an adequate share price. Under the NYSE rules, our Common Stock was allowed to continue to be listed during a cure period. In February 2012, after completing our debt refinancing, the NYSE notified us that we were again in compliance with the minimum closing price standard. In January 2013, the NYSE notified us that we had returned to full compliance with all continued listing standards. |
Consolidated Statements of Operations and Comprehensive Income (Loss) (USD $)
In Thousands, except Per Share data, unless otherwise specified |
3 Months Ended | 9 Months Ended | ||
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Jun. 30, 2013
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Jun. 24, 2012
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Jun. 30, 2013
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Jun. 24, 2012
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Operating revenue: | ||||
Advertising and marketing services | $ 113,636 | $ 120,546 | $ 349,345 | $ 370,263 |
Subscription | 43,583 | 42,098 | 133,609 | 128,909 |
Other | 9,800 | 9,101 | 29,323 | 28,305 |
Total operating revenue | 167,019 | 171,745 | 512,277 | 527,477 |
Operating expenses: | ||||
Compensation | 62,340 | 67,975 | 192,505 | 205,738 |
Newsprint and ink | 10,471 | 12,366 | 33,357 | 38,600 |
Other operating expenses | 53,461 | 51,317 | 160,929 | 157,138 |
Depreciation | 5,215 | 5,811 | 16,146 | 17,755 |
Amortization of intangible assets | 9,542 | 10,438 | 28,635 | 31,982 |
Workforce adjustments | 945 | 2,404 | 2,260 | 3,171 |
Total operating expenses | 141,974 | 150,311 | 433,832 | 454,384 |
Equity in earnings of associated companies | 1,893 | 1,762 | 6,671 | 6,003 |
Operating income | 26,938 | 23,196 | 85,116 | 79,096 |
Non-operating income (expense): | ||||
Financial income | 134 | 3 | 219 | 113 |
Financial expense | (21,991) | (24,468) | (68,390) | (57,533) |
Debt financing costs | (468) | (42) | (557) | (2,780) |
Other, net | 520 | 0 | 7,466 | 0 |
Total non-operating expense, net | (21,805) | (24,507) | (61,262) | (60,200) |
Income (loss) before reorganization costs and income taxes | 5,133 | (1,311) | 23,854 | 18,896 |
Reorganization costs | 0 | (250) | 0 | 37,617 |
Income (loss) before income taxes | 5,133 | (1,061) | 23,854 | (18,721) |
Income tax expense (benefit) | 3,165 | (119) | 11,805 | (6,002) |
Income (loss) from continuing operations | 1,968 | (942) | 12,049 | (12,719) |
Discontinued operations, net of income taxes | 0 | (412) | (1,247) | (553) |
Net income (loss) | 1,968 | (1,354) | 10,802 | (13,272) |
Net income attributable to non-controlling interests | (173) | (119) | (430) | (272) |
Income (loss) attributable to Lee Enterprises, Incorporated | 1,795 | (1,473) | 10,372 | (13,544) |
Other comprehensive income (loss), net of income taxes | (93) | 152 | (280) | 456 |
Comprehensive income (loss) attributable to Lee Enterprises, Incorporated | 1,702 | (1,321) | 10,092 | (13,088) |
Income (loss) from continuing operations attributable to Lee Enterprises, Incorporated | $ 1,795 | $ (1,061) | $ 11,619 | $ (12,991) |
Basic: | ||||
Continuing operations | $ 0.03 | $ (0.02) | $ 0.22 | $ (0.27) |
Discontinued operations | $ 0.00 | $ (0.01) | $ (0.02) | $ (0.01) |
Earnings Per Share, Basic | $ 0.03 | $ (0.03) | $ 0.20 | $ (0.28) |
Diluted: | ||||
Continuing operations | $ 0.03 | $ (0.02) | $ 0.22 | $ (0.27) |
Discontinued operations | $ 0.00 | $ (0.01) | $ (0.02) | $ (0.01) |
Diluted | $ 0.03 | $ (0.03) | $ 0.20 | $ (0.28) |
Debt
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Jun. 30, 2013
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Debt Disclosure [Text Block] |
As discussed more fully below (and certain capitalized terms used below defined), in January 2012, in conjunction with the effectiveness of the Plan, we refinanced all of our debt. The Plan refinanced our then-existing credit agreement and extended the April 2012 maturity in a structure of first and second lien debt with the existing lenders ("Lenders"). We also amended the Pulitzer Notes, and extended the April 2012 maturity with the existing Noteholders. In May 2013, we again refinanced the remaining balance of the Pulitzer Notes. 1st Lien Agreement In January 2012, we entered into a credit agreement (the “1st Lien Agreement”) with a syndicate of lenders (the “1st Lien Lenders”). The 1st Lien Agreement consists of a term loan of $689,510,000, and a new $40,000,000 revolving credit facility under which we have not drawn. The revolving credit facility also supports issuance of letters of credit. Interest Payments Debt under the 1st Lien Agreement bears interest, at our option, at either a base rate or an adjusted Eurodollar rate (“LIBOR”), plus an applicable margin. The base rate for the facility is the greater of (a) the prime lending rate of Deutsche Bank Trust Company Americas at such time; (b) 0.5% in excess of the overnight federal funds rate at such time; or (c) 30 day LIBOR plus 1.0%. LIBOR loans are subject to a minimum rate of 1.25%. The applicable margin for term loan base rate loans is 5.25%, and 6.25% for LIBOR loans. The applicable margin for revolving credit facility base rate loans is 4.5%, and is 5.5% for LIBOR loans. At June 30, 2013, all borrowing under the 1st Lien Agreement is based on LIBOR at a total rate of 7.5%. Principal Payments At June 30, 2013, the balance outstanding under the term loan is $618,500,000. We may voluntarily prepay principal amounts outstanding or reduce commitments under the 1st Lien Agreement at any time, in whole or in part, without premium or penalty, upon proper notice and subject to certain limitations as to minimum amounts of prepayments. We are required to repay principal amounts, on a quarterly basis until maturity, under the 1st Lien Agreement. Principal payments are required quarterly beginning in June 2012, and total $11,000,000 in 2013, $12,750,000 in 2014, $13,500,000 in 2015 and $3,375,000 in 2016, prior to the final maturity. In addition to the scheduled payments, we are required to make mandatory prepayments under the 1st Lien Agreement under certain other conditions, such as from the net proceeds from asset sales. The 1st Lien Agreement also requires us to accelerate future payments in the amount of our quarterly excess cash flow, as defined. The acceleration of such payments due to future asset sales or excess cash flow does not change the due dates of other 1st Lien Agreement payments prior to the December 2015 maturity. 2013 payments made under the 1st Lien Agreement, and required to be made for the remainder of the year, are summarized as follows:
2012 payments made under the 1st Lien Agreement are summarized as follows:
There were no net principal payments made in 2012 under the previous credit agreement. Security The 1st Lien Agreement is fully and unconditionally guaranteed on a joint and several basis by all of our existing and future, direct and indirect subsidiaries in which we hold a direct or indirect interest of more than 50% (the “Credit Parties”); provided however, that our wholly-owned subsidiary Pulitzer Inc. (“Pulitzer”) and its subsidiaries are not Credit Parties. The 1st Lien Agreement is secured by first priority security interests in the stock and other equity interests owned by the Credit Parties in their respective subsidiaries. The Credit Parties have also granted a first priority security interest on substantially all of their tangible and intangible assets, and granted mortgages covering certain real estate, as collateral for the payment and performance of their obligations under the 1st Lien Agreement. Assets of Pulitzer and its subsidiaries, TNI and our ownership interest in, and assets of, MNI are excluded. The revolving credit facility has a super-priority security interest over all of the collateral securing the term loan under the 1st Lien Agreement, superior to that of the term loan lenders. Covenants and Other Matters The 1st Lien Agreement contains customary affirmative and negative covenants for financing of its type. These financial covenants include a maximum total leverage ratio, as defined. The total leverage ratio is designed to assess the leverage of the Company, excluding Pulitzer, and does not reflect our overall leverage position due to the lower leverage of Pulitzer. It is based primarily on the sum of the principal amount of debt under the 1st Lien Agreement, plus debt under the 2nd Lien Agreement, as discussed more fully below, which totals $793,500,000 at June 30, 2013, plus letters of credit and certain other factors, divided by a measure of trailing 12 month operating results, which includes distributions from MNI and other elements, but excludes the operating results of Pulitzer. Our actual total leverage ratio at June 30, 2013 under the 1st Lien Agreement was 6.26:1 Our maximum total leverage ratio covenant will decrease, in stages, from 10.0:1 at June 30, 2013 to 9.1:1 in December 2015. On a consolidated basis, using the definitions in the 1st Lien Agreement, our leverage ratio is 5.25:1 at June 30, 2013. This consolidated measure is not the subject of a covenant in any of our debt agreements. The 1st Lien Agreement also includes a minimum interest expense coverage ratio, as defined, which is based on the sum of interest expense, as defined, incurred under the 1st Lien Agreement and 2nd Lien Agreement, divided by the same measure of trailing 12 month operating results discussed above. The interest expense coverage ratio is similarly designed to assess the interest coverage of the Company, excluding Pulitzer, and does not reflect our overall interest coverage position. Our actual interest expense coverage ratio at June 30, 2013 was 1.66:1. Our minimum interest expense coverage ratio covenant is 1.08:1 at June 30, 2013. The 1st Lien Agreement requires us to suspend stockholder dividends and share repurchases through December 2015. The 1st Lien Agreement also limits capital expenditures to $20,000,000 per year, with a provision for carryover of unused amounts from the prior year. Further, the 1st Lien Agreement restricts our ability to make additional investments, acquisitions, dispositions and mergers without the consent of the 1st Lien Lenders and limits our ability to incur additional debt. Such covenants require that substantially all of our future cash flows are required to be directed toward debt reduction or accumulation of cash collateral and that the cash flows of the Credit Parties are largely segregated from those of Pulitzer. 2nd Lien Agreement In January 2012, we entered into a second lien term loan (the “2nd Lien Agreement”) with a syndicate of lenders (the “2nd Lien Lenders”). The 2nd Lien Agreement consists of a term loan of $175,000,000. The 2nd Lien Agreement bears interest at 15.0%, payable quarterly. Principal Payments and Redemption The 2nd Lien Agreement requires no principal amortization, except in March 2017 if required for income tax purposes. From January 30, 2013 until January 30, 2014, the 2nd Lien Agreement may be redeemed at 102% of the principal amount, at 101% thereafter until January 30, 2015 and at 100% thereafter until the April 2017 final maturity. Terms of the 1st Lien Agreement also restrict principal payments under the 2nd Lien Agreement. Security The 2nd Lien Agreement is fully and unconditionally guaranteed on a joint and several basis by the Credit Parties and by Pulitzer and its subsidiaries, other than TNI (collectively, the "2nd Lien Credit Parties"). The 2nd Lien Agreement is secured by second priority security interests in the stock and other equity interests owned by the 2nd Lien Credit Parties. The 2nd Lien Credit Parties have also granted a second priority security interest on substantially all of their tangible and intangible assets, and granted second lien mortgages or deeds of trust covering certain real estate, as collateral for the payment and performance of their obligations under the 2nd Lien Agreement. Assets of TNI and our ownership interest in, and assets of, MNI are excluded. However, assets of Pulitzer and its subsidiaries, excluding TNI, become subject to a first priority security interest of the 2nd Lien Lenders upon repayment in full of the Pulitzer Notes and any successor debt. The 2nd Lien Lenders were granted a second priority security interest in our ownership interest in TNI under the New Pulitzer Notes, as discussed more fully below. Covenants and Other Matters The 2nd Lien Agreement has no affirmative financial covenants. Restrictions on capital expenditures, permitted investments, indebtedness and other provisions are similar to, but generally less restrictive than, those provisions under the 1st Lien Agreement. 2nd Lien Lenders shared in the issuance of 6,743,640 shares of our Common Stock valued at $9,576,000 based on the closing stock price of $1.42 on the date of issuance, an amount equal to 13% of outstanding shares on a pro forma basis as of January 30, 2012. 2nd Lien Lenders also received $8,750,000 in the form of non-cash fees, which were added to and included in the principal amount of the second lien term loan. Pulitzer Notes In conjunction with its formation in 2000, St. Louis Post-Dispatch LLC ("PD LLC") borrowed $306,000,000 (the “Pulitzer Notes”) from a group of institutional lenders (the “Noteholders”). The Pulitzer Notes were guaranteed by Pulitzer pursuant to a Guaranty Agreement with the Noteholders. The aggregate principal amount of the Pulitzer Notes was payable in April 2009. In February 2009, the Pulitzer Notes and the Guaranty Agreement were amended (the “Notes Amendment”). Under the Notes Amendment, PD LLC repaid $120,000,000 of the principal amount of the debt obligation. The remaining debt balance of $186,000,000 was refinanced by the Noteholders until April 2012. In January 2012, in connection with the Plan, we entered into an amended Note Agreement and Guaranty Agreement, which amended the Pulitzer Notes and extended the maturity with the Noteholders. After consideration of unscheduled principal payments totaling $15,145,000 ($10,145,000 in December 2011 and $5,000,000 in January 2012), offset by $3,500,000 of non-cash fees paid to the Noteholders in the form of additional Pulitzer Notes debt, the amended Pulitzer Notes had a balance of $126,355,000 in January 2012. The Pulitzer Notes carried an interest rate at 10.55%, which increased 0.75% to 11.3% in January 2013 and was to increase in January of each year thereafter. Due to the increasing interest rate, interest on the Pulitzer Notes was charged to expense using a calculated effective interest rate during the period. In May 2013, we refinanced the $94,000,000 remaining balance of the Pulitzer Notes (the “New Pulitzer Notes”) with a subsidiary of Berkshire Hathaway Inc. (“Berkshire”). The New Pulitzer Notes bear interest at a fixed rate of 9.0%, payable quarterly. Pulitzer is a co-borrower under the the New Pulitzer Notes, which eliminates the former Guaranty Agreement made by Pulitzer under the Pulitzer Notes. Principal Payments At June 30, 2013, the balance of the New Pulitzer Notes is $80,000,000. We may voluntarily prepay principal amounts outstanding under the New Pulitzer Notes at any time, in whole or in part, without premium or penalty (except as noted below), upon proper notice, and subject to certain limitations as to minimum amounts of prepayments. The New Pulitzer Notes provide for mandatory scheduled prepayments totaling $6,400,000 annually, beginning in 2014. In addition to the scheduled payments, we are required to make mandatory prepayments under the New Pulitzer Notes under certain other conditions, such as from the net proceeds from asset sales. The New Pulitzer Notes also require us to accelerate future payments in the amount of our quarterly excess cash flow, as defined. The acceleration of such payments due to future asset sales or excess cash flow does not change the due dates of other New Pulitzer Notes payments prior to the final maturity in April 2017. The New Pulitzer Notes are subject to a 5% redemption premium if 100% of the remaining balance of the New Pulitzer Notes is again refinanced by lenders, the majority of which are not holders of the New Pulitzer Notes at the time of such refinancing. This redemption premium is not otherwise applicable to any of the types of payments noted above. 2013 payments made under the New Pulitzer Notes and Pulitzer Notes are summarized below. No payments are required to be made for the remainder of the year under the New Pulitzer Notes.
2012 payments made under the Pulitzer Notes are summarized as follows:
Security Obligations under the New Pulitzer Notes are fully and unconditionally guaranteed on a joint and several basis by Pulitzer's existing and future subsidiaries other than PD LLC and TNI. The New Pulitzer Notes are also secured by first priority security interests in the stock and other equity interests owned by Pulitzer's subsidiaries including the 50% ownership interest in TNI. Also, Pulitzer, certain of its subsidiaries and PD LLC granted a first priority security interest on substantially all of its tangible and intangible assets, excluding the assets of Star Publishing leased to, or used in the operations or business of, TNI and granted deeds of trust covering certain real estate in the St. Louis area, as collateral for the payment and performance of their obligations under the New Pulitzer Notes. Covenants and Other Matters The New Pulitzer Notes contain certain covenants and conditions including the maintenance, by Pulitzer, of minimum trailing 12 month EBITDA (minimum of $25,200,000 beginning June 30, 2013), as defined in the New Pulitzer Notes Agreement, and limitations on capital expenditures and the incurrence of other debt. Further, the New Pulitzer Notes have limitations or restrictions on distributions, loans, advances, investments, acquisitions, dispositions and mergers. Such covenants require that substantially all future cash flows of Pulitzer are required to be directed first toward repayment of the New Pulitzer Notes, interest due under the 2nd Lien Agreement, or accumulation of cash collateral and that cash flows of Pulitzer are largely segregated from those of the Credit Parties. Intercreditor Agreements The 1st Lien Agreement, 2nd Lien Agreement and New Pulitzer Notes contain cross-default provisions tied to each of the various agreements. Intercreditor agreements and an intercompany subordination agreement are also in effect. Other Cash payments to the Lenders, Noteholders and legal and professional fees related to the Plan totaled $38,628,000, of which $6,273,000 was paid in 2011, and the remainder of which was paid in 2012. $720,000 of such costs were charged to expense in 2011. In addition, previously capitalized financing costs of $4,514,000 at September 25, 2011 were charged to expense in 2012 as debt financing costs prior to consummation of the Plan, with the remainder classified as reorganization costs in the Consolidated Statements of Operations and Comprehensive Income (Loss) upon consummation of the Plan. Debt under the Plan was considered compromised. As a result, the 1st Lien Agreement, 2nd Lien Agreement and Pulitzer Notes were recorded at their respective present values, which resulted in a discount to the stated principal amount totaling $23,709,000. We used the effective rates of the respective debt agreements to discount the debt to its present value. In determining the effective rates, we considered all cash outflows of the respective debt agreements including: mandatory principal payments, interest payments, fees paid to lenders in connection with the refinancing as well as, in the case of the 2nd Lien Agreement, Common Stock issued. The present value is being amortized as a non-cash component of financial expense over the terms of the related debt. The refinancing of the Pulitzer Notes with the New Pulitzer Notes resulted in the acceleration of $1,565,000 of the present value adjustment discussed above, which was partially offset by eliminating deferred interest expense of $1,189,000, and the net amount of which was recognized in the 13 weeks ended June 30, 2013. Expenses related to the issuance of the New Pulitzer Notes are capitalized as debt issuance costs and will be amortized until April 2017. Amortization of the present value adjustment and other costs totaled $4,085,000 in 2012. Amortization of such costs is estimated to total $6,681,000 in 2013, $4,779,000 in 2014, $4,742,000 in 2015, $2,297,000 in 2016 and $1,125,000 in 2017. As a result of the Plan, we recognized $37,765,000 of reorganization costs in the 2012 Consolidated Statements of Operations and Comprehensive Income (Loss). The components of reorganization costs are summarized as follows:
Debt is summarized as follows:
At June 30, 2013, our weighted average cost of debt was 9.1%. Aggregate maturities of debt total $3,000,000 for the remainder of 2013, $19,150,000 in 2014, $19,900,000 in 2015, $595,650,000 in 2016 and $235,800,000 in 2017. Liquidity At June 30, 2013, after consideration of letters of credit, we have approximately $29,942,000 available for future use under our revolving credit facility. Including cash, our liquidity at June 30, 2013 totals $41,572,000. This liquidity amount excludes any future cash flows. We expect all interest and principal payments due in the next twelve months will be satisfied by our continuing cash flows, which will allow us to maintain an adequate level of liquidity. At June 30, 2013, the principal amount of our outstanding debt totals $873,500,000, approximately $20 million less than the amount projected for September 2014 under the Plan. Lower cash balances and asset sales have contributed to the improvement in debt repayment compared to the Plan. There are numerous potential consequences under the 1st Lien Agreement, 2nd Lien Agreement, and the New Pulitzer Notes, if an event of default, as defined, occurs and is not remedied. Many of those consequences are beyond our control. The occurrence of one or more events of default would give rise to the right of the 1st Lien Lenders, 2nd Lien Lenders and/or Berkshire, to exercise their remedies under the 1st Lien Agreement, 2nd Lien Agreement, and the New Pulitzer Notes, respectively, including, without limitation, the right to accelerate all outstanding debt and take actions authorized in such circumstances under applicable collateral security documents. Our ability to operate as a going concern is dependent on our ability to remain in compliance with debt covenants and to refinance or amend our debt agreements as they become due, or earlier if available liquidity is consumed. We are in compliance with our debt covenants at June 30, 2013. In 2010, we filed a Form S-3 shelf registration statement ("Shelf") with the SEC, which has been declared effective. The Shelf gives us the flexibility to issue and publicly distribute various types of securities, including preferred stock, common stock, secured or unsecured debt securities, purchase contracts and units consisting of any combination of such securities, from time to time, in one or more offerings, up to an aggregate amount of $750,000,000. In July 2011, the SEC announced changes to the issuer eligibility rules which will require us to have a public float of at least $75,000,000 in order to use the Shelf. Subject to maintenance of the minimum level of equity market float and the conditions of our existing debt agreements, the Shelf may enable us to sell securities quickly and efficiently when market conditions are favorable or financing needs arise. Net proceeds from the sale of any securities must be used generally to reduce debt. |
Debt Reorganization Cost (Tables)
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reorganization Costs [Table Text Block] | The components of reorganization costs are summarized as follows:
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Impact of Recently Issued Accounting Pronouncements
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Jun. 30, 2013
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Impact of Recently Issued Accounting Pronouncements [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS In 2012, the Financial Accounting Standards Board ("FASB") issued an amendment to an existing accounting standard, which provides entities an option to perform a qualitative assessment to determine whether further impairment testing on indefinite-lived intangible assets is necessary. Specifically, an entity has the option to first assess qualitative factors to determine whether it is necessary to perform a quantitative impairment test. If an entity believes, as a result of its qualitative assessment, that it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, the quantitative impairment test is required. Otherwise, no further testing is required. This guidance is effective for annual and interim indefinite-lived intangible asset impairment tests performed for fiscal years beginning after September 15, 2012, and early adoption is permitted. The adoption of this amendment in 2013 did not have a material impact on our Consolidated Financial Statements. |
Common Stock and Class B Common Stock NYSE Requirements (Details) (USD $)
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Jun. 30, 2013
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NYSE Listing Requirements [Line Items] | |
Price Per Share- NYSE Listing Requirement | $ 1 |
Minimum Market Capitalization- NYSE Listing | $ 50,000,000 |
Earnings per Common Share (Tables)
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following table sets forth the computation of basic and diluted earnings (loss) per common share:
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Income Taxes (Tables)
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Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | Income tax expense related to continuing operations differs from the amounts computed by applying the U.S. federal income tax rate to income before income taxes. The reasons for these differences are as follows:
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Commitments and Contingencies (Details) (USD $)
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Jun. 28, 2009
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Jun. 30, 2013
Fair Value, Inputs, Level 3 [Member]
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Jun. 24, 2012
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Feb. 18, 2009
Fair Value, Inputs, Level 3 [Member]
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Loss Contingencies [Line Items] | |||||
Pulitzer Step Up Tax Benefit- Amortization Period | 15 years | ||||
Noncontrolling Interest Redeemed PDLLC, Percent Redeemed | 5.00% | ||||
Heral Value Liability- Liability Input | 10.00% | ||||
Obligations, Fair Value Disclosure | $ 300,000 | $ 300,000 | $ 2,300,000 | ||
Hearld Value- Increase in Amortizable Tax Basis | $ 258,000,000 |
Pension, Postretirement, and Postemployement Obligations (Tables)
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Pension Postretirement And Postemployment Defined Benefit Plans [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Defined Benefit Plans Disclosures [Table Text Block] | The net periodic cost (benefit) components of our pension and postretirement medical plans are as follows:
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Basis of Presentation
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Jun. 30, 2013
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Basis of Presentation [Abstract] | |
Organization Consolidation and Presentation of Financial Statements Disclosure [Text Block] | BASIS OF PRESENTATION The Consolidated Financial Statements included herein are unaudited. In the opinion of management, these financial statements contain all adjustments (consisting of only normal recurring items) necessary to present fairly the financial position of Lee Enterprises, Incorporated and subsidiaries (the “Company”) as of June 30, 2013 and their results of operations and cash flows for the periods presented. The Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in the Company's 2012 Annual Report on Form 10-K. Because of seasonal and other factors, the results of operations for the 13 weeks and 39 weeks ended June 30, 2013 are not necessarily indicative of the results to be expected for the full year. Certain amounts as previously reported have been reclassified to conform with the current period presentation. See Notes 2 and 4. References to “we”, “our”, “us” and the like throughout the Consolidated Financial Statements refer to the Company. References to “2013”, “2012” and the like refer to the fiscal years ended the last Sunday in September. The Consolidated Financial Statements include our accounts and those of our subsidiaries, all of which are wholly-owned, except for our 50% interest in TNI Partners (“TNI”), 50% interest in Madison Newspapers, Inc. (“MNI”), and 82.5% interest in INN Partners, L.C. On December 12, 2011, the Company and certain of its subsidiaries filed voluntary, prepackaged petitions in the U.S. Bankruptcy Court for the District of Delaware (the "Bankruptcy Court") for relief under Chapter 11 of the U.S. Bankruptcy Code (the "U.S. Bankruptcy Code") (collectively, the "Chapter 11 Proceedings"). Our interests in TNI and MNI were not included in the filings. During the Chapter 11 Proceedings, we, and certain of our subsidiaries, continued to operate as "debtors in possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the U.S. Bankruptcy Code. In general, as debtors-in-possession, we were authorized under the U.S. Bankruptcy Code to continue to operate as an ongoing business, but were not to engage in transactions outside the ordinary course of business without the prior approval of the Bankruptcy Court. On January 23, 2012, the Bankruptcy Court approved our Second Amended Joint Prepackaged Plan of Reorganization (the "Plan") under the U.S. Bankruptcy Code and on January 30, 2012 (the "Effective Date") the Company emerged from the Chapter 11 Proceedings. On the Effective Date, the Plan became effective and the transactions contemplated by the Plan were consummated. Implementation of the Plan resulted primarily in a comprehensive refinancing of our debt. The Chapter 11 Proceedings did not adversely affect employees, vendors, contractors, customers or any aspect of Company operations. Stockholders retained their interest in the Company, subject to modest dilution. See Notes 5 and 12. |
Investments in Associated Companies
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Equity Method Investments Disclosure [Text Block] | INVESTMENTS IN ASSOCIATED COMPANIES TNI Partners In Tucson, Arizona, TNI, acting as agent for our subsidiary, Star Publishing Company (“Star Publishing”), and Citizen Publishing Company (“Citizen”), a subsidiary of Gannett Co. Inc., is responsible for printing, delivery, advertising, and circulation of the Arizona Daily Star as well as the related digital platforms and specialty publications. TNI collects all receipts and income and pays substantially all operating expenses incident to the partnership's operations and publication of the newspapers and other media. Income or loss of TNI (before income taxes) is allocated equally to Star Publishing and Citizen. Summarized results of TNI are as follows:
Certain assets utilized by TNI are owned by Star Publishing and Citizen. Star Publishing's 50% share of TNI depreciation and certain general and administrative expenses (income) associated with its share of the operation and administration of TNI are reported as operating expenses (benefit) in our Consolidated Statements of Operations and Comprehensive Income (Loss). These amounts totaled $(173,000) and $(128,000) in the 13 weeks ended June 30, 2013 and June 24, 2012, respectively, $(449,000) in the 40 weeks ended June 30, 2013 and $(440,000) in the 39 weeks ended June 24, 2012. Annual amortization of intangible assets is estimated to be $418,000 in each of the 52 week periods ending June 2014, June 2015, June 2016, June 2017 and June 2018. Madison Newspapers, Inc. We have a 50% ownership interest in MNI, which publishes daily and Sunday newspapers, and other publications in Madison, Wisconsin, and other Wisconsin locations, and operates their related digital platforms. Net income or loss of MNI (after income taxes) is allocated equally to us and The Capital Times Company (“TCT”). MNI conducts its business under the trade name Capital Newspapers. Summarized results of MNI are as follows:
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Pension, Postretirement, and Postemployement Obligations
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Pension Postretirement And Postemployment Defined Benefit Plans [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension and Other Postretirement Benefits Disclosure [Text Block] | PENSION, POSTRETIREMENT AND POSTEMPLOYMENT DEFINED BENEFIT PLANS We have several noncontributory defined benefit pension plans that together cover selected employees. Benefits under the plans were generally based on salary and years of service. Effective in 2012, all benefits are frozen and no additional benefits are being accrued. Our liability and related expense for benefits under the plans are recorded over the service period of active employees based upon annual actuarial calculations. Plan funding strategies are influenced by government regulations and income tax laws. Plan assets consist primarily of domestic and foreign corporate equity securities, government and corporate bonds, and cash. In addition, we provide retiree medical and life insurance benefits under postretirement plans at several of our operating locations. The level and adjustment of participant contributions vary depending on the specific plan. In addition, PD LLC provides postemployment disability benefits to certain employee groups prior to retirement. Our liability and related expense for benefits under the postretirement plans are recorded over the service period of active employees based upon annual actuarial calculations. We accrue postemployment disability benefits when it becomes probable that such benefits will be paid and when sufficient information exists to make reasonable estimates of the amounts to be paid. Plan assets may also be used to fund medical costs of certain active employees. We use a fiscal year end measurement date for all of our pension and postretirement medical plan obligations. The net periodic cost (benefit) components of our pension and postretirement medical plans are as follows:
Based on our forecast at June 30, 2013, we do not expect to contribute to our pension plans for the remainder of 2013. Based on our forecast at June 30, 2013, we do not expect to make significant contributions to our postretirement plans for the remainder of 2013. |
Goodwill and other Intangible Assets
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Jun. 30, 2013
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Goodwill And Other Intangible Assets [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Text Block] | GOODWILL AND OTHER INTANGIBLE ASSETS Changes in the carrying amount of goodwill are as follows:
Identified intangible assets consist of the following:
In assessing the recoverability of goodwill and other nonamortized intangible assets, we annually assess qualitative factors affecting our business to determine if the probability of a goodwill impairment is more likely than not. Our assessment includes reviewing internal and external factors affecting our business such as cash flow projections, stock price and other industry or market considerations. This assessment is made in the last fiscal quarter of each year. We analyze goodwill and other nonamortized intangible assets for impairment more frequently if impairment indicators are present. Such indicators of impairment include, but are not limited to, changes in business climate and operating or cash flow losses related to such assets. Should we determine that a goodwill impairment is more likely than not, we make a determination of the fair value of our business. Fair value is determined using a combination of an income approach, which estimates fair value based upon future revenue, expenses and cash flows discounted to their present value, and a market approach, which estimates fair value using market multiples of various financial measures compared to a set of comparable public companies in the publishing industry. A non-cash impairment charge will generally be recognized when the carrying amount of the net assets of the business exceeds its estimated fair value. Should we determine that a nonamortized intangible asset impairment is more likely than not, we make a determination of the individual asset's fair value. Fair value is determined using the relief from royalty method, which estimates fair value based upon appropriate royalties of future revenue discounted to their present value. The impairment amount, if any, is calculated based on the excess of the carrying amount over the fair value of such asset. The required valuation methodology and underlying financial information that are used to determine fair value require significant judgments to be made by us. These judgments include, but are not limited to, long-term projections of future financial performance and the selection of appropriate discount rates used to determine the present value of future cash flows. Changes in such estimates or the application of alternative assumptions could produce significantly different results. We review our amortizable intangible assets for impairment when indicators of impairment are present. We assess recoverability of these assets by comparing the estimated undiscounted cash flows associated with the asset or asset group with their carrying amount. The impairment amount, if any, is calculated based on the excess of the carrying amount over the fair value of those assets. We also periodically evaluate our determination of the useful lives of amortizable intangible assets. Any resulting changes in the useful lives of such intangible assets will not impact our cash flows. However, a decrease in the useful lives of such intangible assets would increase future amortization expense and decrease future reported operating results and earnings per common share. Annual amortization of intangible assets for the 52 week periods ending June 2014, June 2015, June 2016, June 2017 and June 2018 is estimated to be $38,000,000, $37,804,000, $36,674,000, $35,434,000 and $35,048,000, respectively. |
Stock Ownership Plans (Tables)
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Jun. 30, 2013
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Restricted Stock [Member]
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block] | The table summarizes restricted Common Stock activity during the 39 weeks ended June 30, 2013.
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Stock Options [Member]
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Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block] | A summary of stock option activity during the 39 weeks ended June 30, 2013 follows:
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Debt Schedule of Debt Covenants (Details) (USD $)
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Dec. 27, 2015
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Jun. 30, 2013
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1st Lien Agreement [Member]
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Schedule Of Debt Covenants [Line Items] | ||
Debt Covenants, Maximum Capital Expenditures | $ 20,000,000 | |
Lee Legacy [Member]
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Schedule Of Debt Covenants [Line Items] | ||
Debt Covenants, Total Debt | 793,500,000 | |
1st Lien Agreement [Member] | Lee Legacy [Member]
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Schedule Of Debt Covenants [Line Items] | ||
Leverage Ratio | 6.3 | |
Covenant Limitation, Leverage Ratio | 9.1 | 10.0 |
Consolidated Leverage Ratio | 5.25 | |
Interest Coverage Ratio | 1.66 | |
Covenant Limitation, Interest Coverage Ratio | 1.08 | |
Pulitzer Notes [Member] | Pulitzer [Member]
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Schedule Of Debt Covenants [Line Items] | ||
Minimum EBITDA Covenant Limitation | $ 25,200,000 | |
January 30, 2014 to January 29, 2015 [Member] | 2nd Lien Agreement [Member]
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Schedule Of Debt Covenants [Line Items] | ||
Long Term Debt, Repayments Of Principal, Redemption Percentage | 101.00% |