-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LV7xBfxi3gL448QeAXJAu5LPe7rpSkOSBsHd1mPjf4VkveTessn7fTOl/EN2pFDx qOHTwyjsrLyHLRfYJQ+Ryw== 0001005477-00-003816.txt : 20000511 0001005477-00-003816.hdr.sgml : 20000511 ACCESSION NUMBER: 0001005477-00-003816 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20000326 FILED AS OF DATE: 20000510 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEW YORK TIMES CO CENTRAL INDEX KEY: 0000071691 STANDARD INDUSTRIAL CLASSIFICATION: NEWSPAPERS: PUBLISHING OR PUBLISHING & PRINTING [2711] IRS NUMBER: 131102020 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-05837 FILM NUMBER: 625163 BUSINESS ADDRESS: STREET 1: 229 W 43RD ST CITY: NEW YORK STATE: NY ZIP: 10036 BUSINESS PHONE: 2125561234 MAIL ADDRESS: STREET 1: 229 W 43RD STREET CITY: NEW YORK STATE: NY ZIP: 10036 10-Q 1 FORM 10-Q FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For Quarter Ended March 26, 2000 -------------- Commission file number 1-5837 -------------- THE NEW YORK TIMES COMPANY -------------------------- (Exact name of registrant as specified in its charter) NEW YORK 13-1102020 ------------------------------ ------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 229 WEST 43RD STREET, NEW YORK, NEW YORK ---------------------------------------- (Address of principal executive offices) 10036 ---------- (Zip Code) Registrant's telephone number, including area code 212-556-1234 ------------ 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, and (2) has been subject to such filing requirements for the past 90 days. Yes X No __. Number of shares of each class of the registrant's common stock outstanding as of May 1, 2000 (exclusive of treasury shares): Class A Common Stock 169,094,763 shares Class B Common Stock 847,158 shares PART I. FINANCIAL INFORMATION Item 1. Financial Statements THE NEW YORK TIMES COMPANY CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars and shares in thousands, except per share data)
For the Quarters Ended ----------------------------- March 26, March 28, 2000 1999 ----------------------------- Revenues Advertising ............................................................... $616,747 $522,886 Circulation ............................................................... 180,513 172,055 Other ..................................................................... 45,937 44,117 -------- -------- Total ................................................................. 843,197 739,058 -------- -------- Production costs Raw materials ............................................................. 85,589 87,291 Wages and benefits ........................................................ 165,205 151,222 Other ..................................................................... 108,494 104,612 -------- -------- Total ................................................................. 359,288 343,125 Selling, general and administrative expenses ................................... 328,976 280,692 -------- -------- Total ................................................................. 688,264 623,817 -------- -------- Operating profit ............................................................... 154,933 115,241 Income from joint ventures ..................................................... 3,627 4,203 Interest expense - net ......................................................... 15,342 11,896 -------- -------- Income before income taxes ..................................................... 143,218 107,548 Income taxes ................................................................... 60,155 46,138 -------- -------- Net income ..................................................................... $ 83,063 $ 61,410 ======== ======== Average number of common shares outstanding Basic ..................................................................... 172,960 179,686 Diluted ................................................................... 177,155 183,118 Per share of common stock Basic earnings ............................................................ $ .48 $ .34 ======== ======== Diluted earnings .......................................................... $ .47 $ .34 ======== ======== Dividends ................................................................. $ .105 $ .095 ======== ========
See Notes to Condensed Consolidated Financial Statements. 2 THE NEW YORK TIMES COMPANY CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands)
March 26, December 26, 2000 1999 ---------- ------------ ASSETS (Unaudited) Current Assets Cash and cash equivalents ................................................. $ 36,110 $ 63,861 Accounts receivable-net ................................................... 363,544 366,754 Inventories Newsprint and magazine paper ......................................... 25,768 23,666 Work-in-process and other ............................................ 5,469 4,984 ---------- ---------- Total inventories ............................................... 31,237 28,650 Deferred income taxes ..................................................... 53,611 53,611 Assets held for sale ...................................................... 37,443 37,796 Other current assets ...................................................... 68,157 64,236 ---------- ---------- Total current assets ............................................ 590,102 614,908 ---------- ---------- Other Assets Investments in joint ventures ............................................. 122,952 121,940 Property, plant and equipment (less accumulated depreciation of $1,008,375 in 2000 and $976,767 in 1999) ................................................ 1,236,155 1,218,396 Intangible assets acquired Cost in excess of net assets acquired (less accumulated amortization of $279,694 in 2000 and $270,235 in 1999) ........................................ 1,096,400 953,709 Other intangible assets acquired (less accumulated amortization of $92,695 in 2000 and $85,365 in 1999) ......................................... 455,379 351,309 Miscellaneous assets ...................................................... 241,613 235,540 ---------- ---------- TOTAL ASSETS ................................................................... $3,742,601 $3,495,802 ========== ==========
See Notes to Condensed Consolidated Financial Statements 3 THE NEW YORK TIMES COMPANY CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands)
March 26, December 26, 2000 1999 ----------- ----------- LIABILITIES AND STOCKHOLDERS' EQUITY (Unaudited) - ------------------------------------ Current Liabilities Commercial paper outstanding .............................................................. $ 239,200 $ -- Accounts payable .......................................................................... 200,355 191,706 Accrued payroll and other related liabilities ............................................. 81,899 105,257 Accrued expenses .......................................................................... 223,656 193,553 Unexpired subscriptions ................................................................... 87,963 80,161 Current portion of long-term debt and capital lease obligations ............................................................ 102,725 102,837 ----------- ----------- Total current liabilities ............................................................ 935,798 673,514 ----------- ----------- Other Liabilities Long-term debt ............................................................................ 552,813 512,627 Capital lease obligations ................................................................. 85,011 85,700 Deferred income taxes ..................................................................... 132,222 141,033 Other ..................................................................................... 647,169 634,270 ----------- ----------- Total other liabilities .............................................................. 1,417,215 1,373,630 ----------- ----------- Total liabilities .................................................................... 2,353,013 2,047,144 ----------- ----------- Stockholders' Equity Capital stock of $.10 par value Class A - authorized 300,000,000 shares; issued: 2000 - 178,699,332; 1999 - 177,971,194 (including treasury shares: 2000 - 8,061,996; 1999 - 5,000,000) ........................................... 17,870 17,797 Class B - convertible - authorized 847,158 shares; issued: 2000 - 847,158; 1999 - 847,240 (including treasury shares: 2000 and 1999 - none) ......................................................... 85 85 Additional paid-in capital ................................................................ 10,871 -- Accumulated other comprehensive (loss) income ............................................. (829) 3,170 Retained earnings ......................................................................... 1,669,853 1,600,743 Common stock held in treasury, at cost .................................................... (308,262) (173,137) ----------- ----------- Total stockholders' equity ........................................................... 1,389,588 1,448,658 ----------- ----------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ..................................................... $ 3,742,601 $ 3,495,802 =========== ===========
See Notes to Condensed Consolidated Financial Statements 4 THE NEW YORK TIMES COMPANY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Dollars in thousands)
For the Quarters Ended --------------------------------- March 26, March 28, 2000 1999 --------------------------------- OPERATING ACTIVITIES Net cash provided by operating activities .......................................... $ 148,722 $ 120,959 --------- --------- INVESTING ACTIVITIES Additions to property, plant and equipment ......................................... (13,578) (13,583) Business acquired .................................................................. (296,278) -- Other-net .......................................................................... (7,246) (1,599) --------- --------- Net cash used in investing activities .............................................. (317,102) (15,182) --------- --------- FINANCING ACTIVITIES Commercial paper borrowings ........................................................ 239,200 62,350 Long-term debt Increase ..................................................................... 40,000 (521) Reduction .................................................................... (393) -- Capital shares Issuances .................................................................... 15,667 4,544 Repurchases .................................................................. (135,709) (151,267) Dividends paid to stockholders ..................................................... (18,136) (17,064) --------- --------- Net cash provided by/(used in) financing activities ................................ 140,629 (101,958) --------- --------- (Decrease)/Increase in cash and cash equivalents ................................... (27,751) 3,819 Cash and cash equivalents at the beginning of the year ............................. 63,861 35,991 --------- --------- Cash and cash equivalents at the end of the quarter ................................ $ 36,110 $ 39,810 ========= =========
SUPPLEMENTAL CASH FLOW INFORMATION NONCASH FINANCING AND INVESTING TRANSACTIONS In 1999 the Company purchased a minority interest in TheStreet.com for $15.6 million, of which $3.6 million was in cash and $12.0 million represents an irrevocable credit for services to be used by TheStreet.com through February 2003. Investment and deferred revenue accounts were increased by $12.0 million accordingly. As of March 26, 2000, a total of $2.2 million of advertising credit has been utilized. BUSINESS ACQUIRED The Company acquired certain assets ($308.5 million) and assumed certain liabilities ($12.2 million) of a newspaper, the Worcester Telegram & Gazette, for $296.3 million in cash (see Note 3). OTHER Amounts in these statements of cash flows are presented on a cash basis and may differ from those shown in other sections of the financial statements. See Notes to Condensed Consolidated Financial Statements. 5 THE NEW YORK TIMES COMPANY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. General The accompanying Notes to Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements included in the annual report on Form 10-K for the year ended December 26, 1999, for The New York Times Company (the "Company") filed with the Securities and Exchange Commission (the "SEC"). In the opinion of management, all adjustments necessary for a fair presentation of the financial position and results of operations, as of and for the interim period ended, have been included. Due to the seasonal nature of the Company's business, results for the interim periods are not necessarily indicative of a full year's operations. The fiscal periods included herein comprise 13 weeks for the three-month periods. Certain reclassifications have been made to the 1999 Condensed Consolidated Financial Statements to conform with classifications used at March 26, 2000. 2. Proposed Tracking Stock On January 20, 2000, the Board of Directors of the Company authorized, subject to shareholder approval, the issuance of a new class of stock (Class C Stock). On January 28, 2000, the Company filed a registration statement with the SEC on Form S-3 (the "Form S-3") related to a proposed initial public offering of Class C Stock, which is intended to track the performance of the Company's Internet business division, New York Times Digital ("NYTD group"). This Form S-3 has not yet become effective. At the Annual Meeting of Stockholders to be held on May 23, 2000, stockholders of record as of the close of business on April 6, 2000, are entitled to vote on the proposal to create this new class of stock. The Company separates for financial reporting purposes the NYTD group and the "NYT group" (the Company excluding the NYTD group except for a retained interest in the NYTD group) (see Note 11). The NYT group includes all of the other business segments of the Company: Newspaper, Broadcast and Magazines, except for the businesses that comprise the NYTD group. The NYT group also includes a retained interest in the NYTD group which is currently 100%. This retained interest will decline to reflect the issuance of Class C Stock. The NYTD group includes NYTimes.com, NYToday.com, Boston.com, WineToday.com, GolfDigest.com and Abuzz. The NYTD group's operating results as presented in the financial statements included in Note 11 of the Notes to the Condensed Consolidated Financial Statements reflect the effect of various inter-group arrangements and policies for license fees, inter-group services and income taxes. Beginning in 2000, and coinciding with the effective date of these various arrangements (January 1, 2000), the Company's management determined that its reportable segments consist of Newspapers, Broadcast, Magazines and the operations of the NYTD group. These segments will be evaluated regularly by key management in assessing performance and allocating resources. 6 3. Acquisitions/Dispositions On January 7, 2000, the Company acquired certain assets and assumed certain liabilities of a newspaper, the Worcester Telegram & Gazette (T&G), in Worcester, Mass., for $296.3 million in cash. The cost of this acquisition was funded through the Company's commercial paper program. This transaction was accounted for as a purchase and, accordingly, the T&G was included (as of January 7, 2000) in the Company's Consolidated Financial Statements. A portion of the purchase price was allocated to goodwill ($152.2 million), a portion to other intangibles ($111.4 million) (principally advertiser and subscriber relationships), and the remainder to other assets acquired net of liabilities assumed. The amount allocated to goodwill will be amortized over a 40 year period and the amount allocated to other intangibles will be amortized over an average of 20 years. The purchase price allocation is preliminary and further adjustments are possible based on the completion of a final valuation. If this acquisition had occurred in the beginning of 1999, it would not have had a material impact on the results of operations for periods presented herein. On February 17, 2000, the Company made a decision to offer for sale the Santa Barbara News-Press in Santa Barbara, Calif., the Daily World in Opelousas, La., the Daily News in Palatka, Fla., the Lake City Reporter in Lake City, Fla., The News-Sun in Sebring/Avon Park, Fla., The News-Leader in Fernandina Beach, Fla., and the Marco Island Eagle in Marco Island, Fla. The net assets of these newspapers have been included in the caption "Assets held for sale" in the Company's Condensed Consolidated Balance Sheets as of March 26, 2000 and December 26, 1999, at their carrying value. The sale is expected to be completed by December 31, 2000. The results of operations for these newspapers are not material to the Company. 4. Income Taxes Reconciliations between the effective rate on income before income taxes and the federal statutory rate are as follows:
For the Quarters Ended --------------------------------------------------- March 26, March 28, 2000 1999 - -------------------------------------------------------------------------------------------------------------------- % of % of (Dollars in thousands) Amount Pre-tax Amount Pre-tax - -------------------------------------------------------------------------------------------------------------------- Tax at the federal statutory rate............................ $50,126 35.0% $37,642 35.0% State and local income taxes-net of federal benefit.......... 7,165 5.0 6,174 5.7 Amortization of nondeductible intangible assests acquired............................................. 2,864 2.0 1,978 1.8 Other-net.................................................... -- -- 344 0.4 --------------------------------------------------- Income tax expense $60,155 42.0% $46,138 42.9% ===================================================
5. Debt Obligations In March 2000 the Company issued $40.0 million of 7% subordinated notes due March 21, 2003, to three venture capital firms. After the consummation of the proposed initial public offering of Class C stock, this debt will be convertible, at the election of the venture capital firms, into shares of Class C stock intended to represent approximately 6.7% of the pre-offering equity of the NYTD group. If there is no offering, this debt will not be convertible. The Company has agreed to give the venture capital firms piggyback and demand registration rights for Class C stock issued upon conversion. The Company has a total of $400.0 million in revolving credit agreements, which require, among other provisions, specified levels of stockholders' equity. As of March 26, 2000, the amount outstanding under the Company's commercial paper program which is supported by these revolving credit agreements was $239.2 million. The amount available under the Company's commercial paper program was $160.8 million as of March 26, 2000. No amounts were outstanding under the Company's revolving credit agreements as of March 26, 2000. Approximately $429.3 million of stockholders' equity was unrestricted under these agreements as of March 26, 2000. 7 As of March 26, 2000, the Company had outstanding $979.7 million in total debt, including commercial paper and capital leases, of which $100.0 million was paid on April 28, 2000. 6. Stock Repurchase Program During the first quarter of 2000, the Company repurchased 3.1 million shares of Class A Common Stock at a cost of $135.7 million. The average price of these repurchases was $44 per share. As of May 1, 2000, the remaining amount of repurchase authorizations from the Company's Board of Directors was $230.5 million. 7. Voluntary Staff Reductions Work force reduction accruals included in "Accrued expenses" on the Company's Condensed Consolidated Balance Sheets amounted to $13.9 million at March 26, 2000, and $20.0 million at December 26, 1999. Most of the accruals outstanding at March 26, 2000, will be paid within one year. 8. Comprehensive Income Comprehensive income for the Company principally includes unrealized gains/(losses) on available-for-sale securities, as defined under SFAS No. 115, "Accounting for Certain Investments in Debt and Equity Securities," foreign currency translation adjustments, and net income as reported in the Company's Condensed Consolidated Statements of Income. Comprehensive income for 2000 and 1999 was as follows:
------------------------------------------------------------------------------------------------------- For the Quarters Ended ---------------------------------- March 26, March 28, ---------------------------------- (Dollars in thousands) 2000 1999 ------------------------------------------------------------------------------------------------------- Net Income $83,063 $61,410 Foreign currency translation (losses)/gains (239) 618 Change in unrealized (losses) on marketable securities (7,229) -- Income tax benefit/(charge) 3,469 (265) ------------------------------------------------------------------------------------------------------- Comprehensive income $79,064 $61,763 -------------------------------------------------------------------------------------------------------
The accumulated other comprehensive (loss) income on the Company's Condensed Consolidated Balance Sheets was net of a deferred income tax asset of $0.9 million as of March 26, 2000, and net of a deferred income tax liability of $2.6 million as of December 26, 1999. 9. Dividend Rate Increase On April 27, 2000, the Board of Directors authorized a $.01 per share increase in the quarterly dividend on its Class A and Class B common stock from $.105 per share to $.115 per share, effective with the June 1, 2000, record date. 8 10. Segment Statements of Income
- -------------------------------------------------------------------------------------------------------------------------- For the Quarters Ended ------------------------------- March 26, March 28, (Dollars in thousands) 2000 1999 - -------------------------------------------------------------------------------------------------------------------------- REVENUES Newspapers ............................................................... $ 770,870 $ 675,160 Broadcast ................................................................ 34,351 33,093 Magazines ................................................................ 28,909 27,715 New York Times Digital ................................................... 11,569 3,823 Intersegment eliminations (A) ............................................ (2,502) (733) ----------------------------- Total .................................................................... $ 843,197 $ 739,058 ============================= OPERATING PROFIT (LOSS) Newspapers ............................................................... $ 163,069 $ 117,401 Broadcast ................................................................ 7,385 6,985 Magazines ................................................................ 4,505 4,531 New York Times Digital ................................................... (10,049) (5,100) Unallocated corporate expenses ........................................... (9,977) (8,576) ----------------------------- Total .................................................................... 154,933 115,241 Income from joint ventures ............................................... 3,627 4,203 Interest expense, net .................................................... 15,342 11,896 ----------------------------- Income before income taxes ............................................... 143,218 107,548 Income taxes ............................................................. 60,155 46,138 ----------------------------- NET INCOME ............................................................... $ 83,063 $ 61,410 =============================
See Management's Discussion and Analysis of Financial Condition and Results of Operations in this Form 10-Q for more information on the Company's reportable operating segments. (A) Intersegment eliminations primarily include revenues between New York Times Digital and other segments. 9 11. Consolidating Information Below is the consolidating financial information of the NYT group and the NYTD group. The financial information reflects the businesses of the NYTD group and the NYT group, including the allocation of revenues and expenses between the NYTD group and the NYT group in accordance with the Company's allocation policies. The NYT group presented below excludes its retained interest in the NYTD group, which is currently 100%. This retained interest will decline to reflect the issuance of Class C Stock. The allocations are as follows: a) inter-group advertising revenues between the NYT and NYTD groups, b) a portion of classified advertising revenues from the NYT group to the NYTD group, c) license fees charged by the NYT group to the NYTD group for the electronic use of the trademarks and copyrights owned by the NYT group, and d) a portion of NYT group expenses for general and administrative services and shared processing services from the NYT group to the NYTD group. Additionally, the income tax benefit relating to the operations of the NYTD group, which could be utilized on a consolidated basis, were allocated to the NYTD group. The Company believes that the aforementioned allocations were made on a reasonable basis. Condensed CONSOLIDATING STATEMENTS OF INCOME
Quarter Ended March 26, 2000 ----------------------------------------------------------------------- The New The NYT The NYTD Elimina- York Times (In thousands) Group Group tions Company - ------------------------------------------------------------------------------------------------------------------------ REVENUES External non-internet revenues $ 830,914 $ -- $ -- $ 830,914 External internet revenues 714 11,569 -- 12,283 Inter-group revenue 2,502 -- (2,502) -- - ------------------------------------------------------------------------------------------------------------------------ Total 834,130 11,569 (2,502) 843,197 - ------------------------------------------------------------------------------------------------------------------------ COSTS AND EXPENSES Production costs: External expenses 353,257 6,031 -- 359,288 Inter-group expense -- 2,502 (2,502) -- Selling, general and administrative expenses: External expenses 316,301 12,675 -- 328,976 Inter-group allocated expenses (410) 410 -- -- - ------------------------------------------------------------------------------------------------------------------------ Total 669,148 21,618 (2,502) 688,264 - ------------------------------------------------------------------------------------------------------------------------ OPERATING PROFIT (LOSS) 164,982 (10,049) -- 154,933 Income from joint ventures 3,627 -- -- 3,627 Interest expense, net 15,342 -- -- 15,342 - ------------------------------------------------------------------------------------------------------------------------ Income (loss) before income taxes 153,267 (10,049) -- 143,218 - ------------------------------------------------------------------------------------------------------------------------ Income taxes (benefit) 64,376 (4,221) -- 60,155 - ------------------------------------------------------------------------------------------------------------------------ NET INCOME/(LOSS) $ 88,891 $ (5,828) -- $ 83,063 - ------------------------------------------------------------------------------------------------------------------------ Quarter Ended March 28, 1999 ----------------------------------------------------------------------- The New The NYT The NYTD Elimina- York Times (In thousands) Group Group tions Company - ------------------------------------------------------------------------------------------------------------------------ REVENUES External non-internet revenues $ 734,761 $ -- $ -- $ 734,761 External internet revenues 474 3,823 -- 4,297 Inter-group revenue 733 -- (733) -- - ------------------------------------------------------------------------------------------------------------------------ Total 735,968 3,823 (733) 739,058 - ------------------------------------------------------------------------------------------------------------------------ COSTS AND EXPENSES Production costs: External expenses 339,826 3,299 -- 343,125 Inter-group expense -- 733 (733) -- Selling, general and administrative expenses: External expenses 276,382 4,310 -- 280,692 Inter-group allocated expenses (581) 581 -- -- - ------------------------------------------------------------------------------------------------------------------------ Total 615,627 8,923 (733) 623,817 - ------------------------------------------------------------------------------------------------------------------------ OPERATING PROFIT (LOSS) 120,341 (5,100) -- 115,241 Income from joint ventures 4,203 -- -- 4,203 Interest expense, net 11,896 -- -- 11,896 - ------------------------------------------------------------------------------------------------------------------------ Income (loss) before income taxes 112,648 (5,100) -- 107,548 - ------------------------------------------------------------------------------------------------------------------------ Income taxes (benefit) 48,326 (2,188) -- 46,138 - ------------------------------------------------------------------------------------------------------------------------ NET INCOME/(LOSS) $ 64,322 $ (2,912) $ -- $ 61,410 - ------------------------------------------------------------------------------------------------------------------------
10 CONDENSED CONSOLIDATING BALANCE SHEETS
March 26, 2000 ----------------------------------------------------------------------------- Reclassifi- The New The NYT The NYTD cations/ York Times (In thousands) Group Group Eliminations Company - ----------------------------------------------------------------------------------------------------------------------------------- ASSETS Current assets $ 582,208 $ 7,894 $ -- $ 590,102 Investment in joint ventures 122,952 -- -- 122,952 Funds allocated to the NYTD group, net 42,886 -- (42,886) -- Property plant & equipment, net 1,225,221 10,934 -- 1,236,155 Intangible assets acquired, net 1,524,414 27,365 -- 1,551,779 Miscellaneous assets 241,011 602 -- 241,613 - ----------------------------------------------------------------------------------------------------------------------------------- Total $ 3,738,692 $ 46,795 $ (42,886) $ 3,742,601 - ----------------------------------------------------------------------------------------------------------------------------------- LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities $ 921,493 $ 14,305 $ -- $ 935,798 Other liabilities 1,375,775 41,440 -- 1,417,215 Funds allocated from the NYT group, net -- 42,886 (42,886) -- Common stock 17,955 -- -- 17,955 Additional paid-in capital 10,871 -- -- 10,871 Retained earnings (accumulated losses) 1,721,689 (51,836) -- 1,669,853 Common stock held in treasury, at cost, and other (309,091) -- -- (309,091) - ----------------------------------------------------------------------------------------------------------------------------------- Total $ 3,738,692 $ 46,795 $ (42,886) $ 3,742,601 - ----------------------------------------------------------------------------------------------------------------------------------- December 26, 1999 ----------------------------------------------------------------------------- Reclassifi- The New The NYT The NYTD cations/ York Times (In thousands) Group Group Eliminations Company - ----------------------------------------------------------------------------------------------------------------------------------- ASSETS Current assets $ 605,350 $ 9,558 $ -- $ 614,908 Investment in joint ventures 121,940 -- -- 121,940 Funds allocated to the NYTD group, net 80,440 -- (80,440) -- Property plant & equipment, net 1,208,601 9,795 -- 1,218,396 Intangible assets acquired, net 1,276,134 28,884 -- 1,305,018 Miscellaneous assets 235,052 488 -- 235,540 - ----------------------------------------------------------------------------------------------------------------------------------- Total $ 3,527,517 $ 48,725 $ (80,440) $ 3,495,802 - ----------------------------------------------------------------------------------------------------------------------------------- LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities $ 660,978 $ 12,536 $ -- $ 673,514 Other liabilities 1,371,873 1,757 -- 1,373,630 Funds allocated from the NYT group, net -- 80,440 (80,440) -- Common stock 17,882 -- -- 17,882 Additional paid-in capital -- -- -- -- Retained earnings (accumulated losses) 1,646,751 (46,008) -- 1,600,743 Common stock held in treasury, at cost, and other (169,967) -- -- (169,967) - ----------------------------------------------------------------------------------------------------------------------------------- Total $ 3,527,517 $ 48,725 $ (80,440) $ 3,495,802 - -----------------------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL INFORMATION TO THE CONDENSED CONSOLIDATING BALANCE SHEETS FUNDS ALLOCATED TO/FROM THE NYTD GROUP
Funds Funds allocated Debt proceeds allocated to/ from the advanced to the from the NYT (In thousands) NYT group NYT group group, net -------------------------------------------------- Balance at December 26, 1999 ............................................ $ 80,440 $ -- $ 80,440 Funds allocated from the NYT group ................................... 2,446 -- 2,446 Debt proceeds advanced to the NYT group(A) ........................... -- (40,000) (40,000) -------------------------------------------------- Balance at March 26, 2000 ............................................... $ 82,886 $(40,000) $ 42,886 ==================================================
(A) The Company will make the proceeds of this debt (see Note 5) available to the NYTD group as they are needed and as such the NYTD group will accrue interest income on the amount of proceeds still available to the NYTD group at the Company's short-term interest rate. Advertising Credits On March 3, 2000, the NYT group committed to provide $30.0 million in advertising credits to the NYTD group to be utilized in any of the NYT group's print publications. It is the NYTD group's current intention to use these credits as consideration to effect strategic alliances, investments and acquisitions. The advertising credits will be recorded on the NYTD group's financial statements as they are committed to independent third parties. The fair market value of what is received or the value of the advertising given up, whichever is more readily determinable, will be recorded as an asset with a corresponding amount recorded as funds allocated from the NYT group to the NYTD group, in the NYTD group's financial statements. 11 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
Quarter Ended March 26, 2000 ------------------------------------------------- The New The NYT The NYTD Elimina- York Times (In thousands) Group Group tions Company - ----------------------------------------------------------------------------------------------------------------------------------- OPERATING ACTIVITIES Net cash provided by operating activities $ 148,267 $ 455 $ -- $ 148,722 - ----------------------------------------------------------------------------------------------------------------------------------- INVESTING ACTIVITIES Additions to property, plant and equipment (11,653) (1,925) -- (13,578) Business acquired (296,278) -- -- (296,278) Other-net (7,246) -- -- (7,246) - ----------------------------------------------------------------------------------------------------------------------------------- Net cash used in investing activities (315,177) (1,925) -- (317,102) - ----------------------------------------------------------------------------------------------------------------------------------- FINANCING ACTIVITIES Commercial paper borrowings 239,200 -- -- 239,200 Long-term debt Increase -- 40,000 -- 40,000 Reduction (23) (370) -- (393) Capital shares Issuances 15,667 -- -- 15,667 Repurchases (135,709) -- -- (135,709) Dividends paid to stockholders (18,136) -- -- (18,136) Funds allocated between the NYT group to the NYTD group 38,325 (38,325) -- -- - ----------------------------------------------------------------------------------------------------------------------------------- Net cash provided/(used in) by financing activities 139,324 1,305 -- 140,629 - ----------------------------------------------------------------------------------------------------------------------------------- Net (decrease) increase in cash and short-term investments (27,586) (165) -- (27,751) Cash and cash equivalents at the beginning of the year 63,677 184 -- 63,861 - ----------------------------------------------------------------------------------------------------------------------------------- Cash and cash equivalents at the end of the year $ 36,091 $ 19 $ -- $ 36,110 - ----------------------------------------------------------------------------------------------------------------------------------- Quarter Ended March 28, 1999 ------------------------------------------------- The New The NYT The NYTD Elimina- York Times (In thousands) Group Group tions Company - ----------------------------------------------------------------------------------------------------------------------------------- OPERATING ACTIVITIES Net cash provided by operating activities $ 121,373 $ (414) $ -- $ 120,959 - ----------------------------------------------------------------------------------------------------------------------------------- INVESTING ACTIVITIES Additions to property, plant and equipment (12,444) (1,139) -- (13,583) Business acquired -- -- -- -- Other-net (1,599) -- -- (1,599) - ----------------------------------------------------------------------------------------------------------------------------------- Net cash used in investing activities (14,043) (1,139) -- (15,182) - ----------------------------------------------------------------------------------------------------------------------------------- FINANCING ACTIVITIES Commercial paper borrowings 62,350 -- -- 62,350 Long-term debt Increase -- -- -- -- Reduction (521) -- -- (521) Capital shares Issuances 4,544 -- -- 4,544 Repurchases (151,267) -- -- (151,267) Dividends paid to stockholders (17,064) -- -- (17,064) Funds allocated to/from the NYT group to the NYTD group (1,785) 1,785 -- -- - ----------------------------------------------------------------------------------------------------------------------------------- Net cash provided/(used in) by financing activities (103,743) 1,785 -- (101,958) - ----------------------------------------------------------------------------------------------------------------------------------- Net (decrease) increase in cash and short-term investments 3,587 232 -- 3,819 Cash and cash equivalents at the beginning of the year 35,950 41 -- 35,991 - ----------------------------------------------------------------------------------------------------------------------------------- Cash and cash equivalents at the end of the year $ 39,537 $ 273 $ -- $ 39,810 - -----------------------------------------------------------------------------------------------------------------------------------
12 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Advertising revenues accounted for approximately 73% and circulation revenues accounted for 21% of the Company's revenues in the first quarter of 2000. Advertising revenues influence the pattern of the Company's consolidated revenues because they are seasonal in nature. Traditionally, second-quarter and fourth-quarter advertising volume is higher than that which occurs in the first and third quarters when economic activity tends to be lower after the holiday season and in the summer period. Quarterly trends are also affected by the overall economy and economic conditions that may exist in specific markets served by each of the Company's business segments. Newsprint is the major component of the Company's cost of raw materials. The Company's cost of newsprint was lower in the first quarter of 2000 compared with the first quarter of 1999. The cost of newsprint is expected to rise in 2000 over 1999 levels. The Company's consolidated financial results for the first quarter of 2000 compared with the first quarter of 1999, were as follows:
- ------------------------------------------------------------------------------------------------------------------ For the Quarters Ended ------------------------------------------------- March 26, March 28, (Dollars in thousands, except per share data) 2000 1999 % Change - ------------------------------------------------------------------------------------------------------------------ Revenues $843,197 $ 739,058 14.1% - ------------------------------------------------------------------------------------------------------------------ Operating profit $154,933 $ 115,241 34.4% - ------------------------------------------------------------------------------------------------------------------ Net Income $ 83,063 $ 61,410 35.3% - ------------------------------------------------------------------------------------------------------------------ Diluted earning per share $ 0.47 $ 0.34 38.2% - ------------------------------------------------------------------------------------------------------------------
Revenues for the first quarter of 2000 were $843.2 million, a 14.1% increase over 1999 first-quarter revenues of $739.1 million. Excluding revenues from the Worcester Telegram & Gazette (T&G), which was acquired on January 7, 2000, revenues rose 11.7% and advertising revenues grew 15.6%. The increase was primarily from strong national and help-wanted advertising at the Newspaper Group with the largest increases at The New York Times and The Boston Globe. Operating profit in the first quarter of 2000 increased 34.4% to $154.9 million from $115.2 million in the 1999 first quarter. The 2000 first-quarter net income was $83.1 million, or $0.47 diluted earnings per share, compared with net income of $61.4 million, or $0.34 diluted earnings per share, in the first quarter of 1999. This increase was principally from strong revenue growth. EBITDA (earnings before interest, taxes, depreciation and amortization) in the first quarter of 2000 rose to $210.2 million from $167.9 million in the 1999 first quarter. EBITDA is presented since it is a widely accepted indicator of funds available to service debt, although it is not a measure of liquidity or of financial performance under generally accepted accounting principles ("GAAP"). The EBITDA presented may not be comparable to similarly titled measures reported by other companies. The Company believes that EBITDA, while providing useful information, should not be considered in isolation or as an alternative to net income or cash flows as determined under GAAP. 13 Consolidated operating expenses for the first quarter of 2000 and 1999 were as follows: - ------------------------------------------------------------------------------- For the Quarters Ended ------------------------------------------------- March 26, March 28, (Dollars in thousands) 2000 1999 % Change - ------------------------------------------------------------------------------- Production costs Raw materials $ 85,589 $87,291 -2.0% Wages and benefits 165,205 151,222 9.2% Other 108,494 104,612 3.7% - ------------------------------------------------------------------------------- Total production costs 359,288 343,125 4.7% Selling, general and administrative expenses 328,976 280,692 17.2% - ------------------------------------------------------------------------------- Total expenses $688,264 $623,817 10.3% - ------------------------------------------------------------------------------- Production costs for the first quarter of 2000 were $359.3 million, a 4.7% increase from the 1999 first-quarter production costs of $343.1 million. Excluding the T&G, production costs for the first quarter of 2000 were $353.9 million, a 3.1% increase from the 1999 first-quarter production costs of $343.1 million. For the first quarter of 2000 lower newsprint costs favorably affected raw material expenses. Selling, general and administrative expenses ("SGA expenses") in the first quarter of 2000 were $329.0 million, a 17.2% increase over the 1999 first quarter SGA expenses of $280.7 million. Excluding the T&G, SGA expenses in the first quarter of 2000 were $319.0 million, a $38.3 million or 13.7% increase over the 1999 first quarter SGA expenses of $280.7 million. The higher level of SGA expenses, excluding the addition of the T&G, is partly attributable to the continuing national expansion of The New York Times newspaper, increased costs for the expansion of New York Times Digital and higher incentive pay, linked to strong first-quarter results. The Company currently expects growth in its total expenses, excluding the effects of newsprint, New York Times Digital and the T&G, to be in the range of four to six percent for 2000. Other Items Interest expense-net increased to $15.3 million in the 2000 first quarter from $11.9 million in the 1999 first quarter principally due to additional borrowings to fund the purchase of the T&G and the Company's share repurchase program. The effective income tax rate for the first quarter of 2000 was 42.0% compared with 42.9% in the 1999 first quarter. The decrease in the effective income tax rates were primarily due to lower state and local income taxes. 14 Consolidated revenues, EBITDA, depreciation and amortization and operating profit by business segment were as follows:
- ----------------------------------------------------------------------------------------------------------------------------------- For the Quarters Ended --------------------------------------------------------------- March 26, March 28, (Dollars in thousands) 2000 1999 % Change - ----------------------------------------------------------------------------------------------------------------------------------- REVENUES Newspapers .................................................. $ 770,870 $ 675,160 14.2% Broadcast ................................................... 34,351 33,093 3.8% Magazines ................................................... 28,909 27,715 4.3% New York Times Digital ...................................... 11,569 3,823 202.6% Intersegment eliminations (A) ............................... (2,502) (733) N/A --------------------------------------------------------------- Total .................................................... $ 843,197 $ 739,058 14.1% =============================================================== EBITDA Newspapers .................................................. $ 204,964 $ 158,283 29.5% Broadcast ................................................... 11,685 11,355 2.9% Magazines ................................................... 4,834 4,879 -0.9% New York Times Digital ...................................... (7,632) (4,799) -59.0% Unallocated corporate expenses .............................. (7,342) (6,084) -20.7% Joint ventures .............................................. 3,714 4,291 -13.4% --------------------------------------------------------------- Total .................................................... $ 210,223 $ 167,925 25.2% =============================================================== DEPRECIATION AND AMORTIZATION Newspapers .................................................. $ 41,895 $ 40,882 2.5% Broadcast ................................................... 4,300 4,370 -1.6% Magazines ................................................... 329 348 -5.5% New York Times Digital ...................................... 2,417 301 N/A Corporate ................................................... 2,635 2,492 5.7% Joint ventures .............................................. 87 87 -- --------------------------------------------------------------- Total .................................................... $ 51,663 $ 48,480 6.6% =============================================================== OPERATING PROFIT (LOSS) Newspapers .................................................. $ 163,069 $ 117,401 38.9% Broadcast ................................................... 7,385 6,985 5.7% Magazines ................................................... 4,505 4,531 -0.6% New York Times Digital ...................................... (10,049) (5,100) -97.0% Unallocated corporate expenses .............................. (9,977) (8,576) -16.3% --------------------------------------------------------------- Total .................................................... $ 154,933 $ 115,241 34.4% ===============================================================
(A) Intersegment eliminations primarily include revenues between New York Times Digital and other segments. Newspaper Group: The Newspaper Group consists of The New York Times ("The Times"), The Boston Globe ("The Globe"), 22 other newspapers, newspaper distributors, a news service, a features syndicate, TimesFax, licensing operations of the New York Times databases and microfilm. - ------------------------------------------------------------------------------- For the Quarters Ended ----------------------------------------------- March 26, March 28, (Dollars in thousands) 2000 1999 % Change - ------------------------------------------------------------------------------- Revenues $770,870 $675,160 14.2% - ------------------------------------------------------------------------------- EBITDA $204,964 $158,283 29.5% - ------------------------------------------------------------------------------- Operating profit $163,069 $117,401 38.9% - ------------------------------------------------------------------------------- 15 Total Newspaper Group revenues in the first quarter of 2000 were $770.9 million, a 14.2% increase, compared with $675.2 million in the first quarter of 1999. Excluding the T&G, total Newspaper Group revenues increased 11.6% to $753.5 million in the first quarter of 2000 from $675.2 million in the same period of 1999, and advertising revenue grew 15.3%. Performance was strongest at The Times and The Globe where advertising revenues increased 19.9% and 13.3% for the first quarter of 2000. Both newspapers benefited from strong national and help-wanted advertising. Operating profit for the Newspaper Group increased 38.9% to $163.1 million ($161.0 million or 37.2% excluding the T&G) in the first quarter of 2000 from $117.4 million in the 1999 first quarter principally from strong revenue growth. The Company currently expects advertising revenue growth in the Newspaper Group, excluding the T&G, to be in the range of six to eight percent for 2000. Advertising, circulation and other revenue, by major product of the Newspaper Group, were as follows:
- ---------------------------------------------------------------------------------------------- For the Quarters Ended ------------------------------------------- March 26, March 28, (Dollars in thousands) 2000 1999 % Change - ---------------------------------------------------------------------------------------------- The New York Times Advertising $327,847 $273,431 19.9% Circulation 117,128 113,446 3.2% Other 36,191 34,422 5.1% - ---------------------------------------------------------------------------------------------- Total $481,166 $421,299 14.2% - ---------------------------------------------------------------------------------------------- New England Newspaper Group The Boston Globe Advertising $121,486 $107,253 13.3% Circulation 32,728 32,325 1.2% Other 2,581 2,314 11.5% - ---------------------------------------------------------------------------------------------- Subtotal $156,795 $141,892 10.5% - ---------------------------------------------------------------------------------------------- Worcester Telegram & Gazette Advertising $12,500 N/A N/A Circulation 4,485 N/A N/A Other 363 N/A N/A - ---------------------------------------------------------------------------------------------- Subtotal $17,348 N/A N/A - ---------------------------------------------------------------------------------------------- Total New England Newspaper Group Advertising $133,986 $107,253 24.9% Circulation 37,213 32,325 15.1% Other 2,944 2,314 27.2% - ---------------------------------------------------------------------------------------------- Total $174,143 $141,892 22.7% - ---------------------------------------------------------------------------------------------- Regional Newspapers Advertising $ 91,119 $87,891 3.7% Circulation 20,286 20,235 0.3% Other 4,156 3,843 8.1% - ---------------------------------------------------------------------------------------------- Total $115,561 $111,969 3.2% - ---------------------------------------------------------------------------------------------- Total Newspaper Group Advertising $552,952 $468,575 18.0% Circulation 174,627 166,006 5.2% Other 43,291 40,579 6.7% - ---------------------------------------------------------------------------------------------- Total $770,870 $675,160 14.2% ==============================================================================================
16 Advertising volume was as follows:
- ------------------------------------------------------------------------------------------------------------ For the Quarters Ended -------------------------------------------- March 26, March 28, (Inches in thousands, preprints in thousands of copies) 2000 1999 % Change - ------------------------------------------------------------------------------------------------------------ The New York Times Retail 125.4 125.1 0.2% National 415.2 351.0 18.3% Classified 251.3 252.8 -0.6% Zoned 245.1 226.1 8.4% - ------------------------------------------------------------------------------------------------------------ Total 1,037.0 955.0 8.6% - ------------------------------------------------------------------------------------------------------------ Preprints 98,527 96,509 2.1% - ------------------------------------------------------------------------------------------------------------ New England Newspaper Group The Boston Globe Retail 125.5 138.6 -9.5% National 191.5 173.3 10.5% Classified 345.5 337.4 2.4% Zoned 56.2 55.7 0.9% - ------------------------------------------------------------------------------------------------------------ Total 718.7 705.0 1.9% - ------------------------------------------------------------------------------------------------------------ Preprints 185,505 186,362 -0.5% - ------------------------------------------------------------------------------------------------------------ Worcester Telegram & Gazette Retail 63.5 N/A N/A National 12.3 N/A N/A Classified 126.1 N/A N/A Zoned 97.9 N/A N/A - ------------------------------------------------------------------------------------------------------------ Total 299.8 N/A N/A - ------------------------------------------------------------------------------------------------------------ Preprints 42,247 N/A N/A - ------------------------------------------------------------------------------------------------------------ Regional Newspapers Retail 1,819.1 1,848.8 -1.6% National 72.6 68.5 6.0% Classified 1,969.5 1,917.8 2.7% Legal 86.0 84.0 2.4% - ------------------------------------------------------------------------------------------------------------ Total 3,947.2 3,919.1 0.7% - ------------------------------------------------------------------------------------------------------------ Preprints 273,650 270,222 1.3% - ------------------------------------------------------------------------------------------------------------
17 Average circulation for The Times, The Globe, the T&G and the Regional Newspapers (excluding non-dailies) for the first quarter of 2000, compared with the first quarter of 1999, was as follows:
- ------------------------------------------------------------------------------------------------ For the Quarter Ended March 26, 2000 ----------------------------------------------------------- (Copies in thousands) Weekday % Change Sunday % Change - ------------------------------------------------------------------------------------------------ Average Net Paid Circulation The New York Times 1,154.5 2.3% 1,724.2 1.1% New England Newspaper The Boston Globe 466.6 0.9% 719.1 -1.0% Worcester Telegram & Gazette 103.6 N/A 128.8 N/A Regional Newspapers 764.8 -1.2% 815.1 -1.2% - ------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------ For the Quarter Ended March 28, 1999 ----------------------------------------------------------- (Copies in thousands) Weekday % Change Sunday % Change - ------------------------------------------------------------------------------------------------ Average Net Paid Circulation The New York Times 1,128.8 2.2% 1,705.8 3.0% The Boston Globe 462.4 0.1% 726.1 -2.7% Regional Newspapers 773.9 -0.5% 825.4 -1.0% - ------------------------------------------------------------------------------------------------
Circulation growth for The Times was primarily due to additional availability and promotion in major markets across the nation combined with programs to improve the quality and levels of its home delivery circulation base. Additionally, The Times and The Globe have continued to make improvements in delivery and customer service to attract new readers and retain existing ones. Broadcast Group: The Broadcast Group is comprised of eight network-affiliated television stations and two radio stations. - -------------------------------------------------------------------------------- For the Quarters Ended ------------------------------------- March 26, March 28, (Dollars in thousands) 2000 1999 % Change - -------------------------------------------------------------------------------- Revenues $34,351 $33,093 3.8% - -------------------------------------------------------------------------------- EBITDA $11,685 $11,355 2.9% - -------------------------------------------------------------------------------- Operating Profit $ 7,385 $ 6,985 5.7% - -------------------------------------------------------------------------------- Revenues increased 3.8% in the 2000 first quarter to $34.4 million from $33.1 million in the 1999 first quarter, while operating profit improved 5.7% to $7.4 million from $7.0 million in the first-quarter of last year. The improvement is mainly due to political advertising associated with the presidential primaries. 18 Magazine Group: The Magazine Group is comprised of three golf publications and related activities in the golf field. - -------------------------------------------------------------------------------- For the Quarters Ended ------------------------------------- March 26, March 28, (Dollars in thousands) 2000 1999 % Change - -------------------------------------------------------------------------------- Revenues $28,909 $27,715 4.3% - -------------------------------------------------------------------------------- EBITDA $ 4,834 $ 4,879 -0.9% - -------------------------------------------------------------------------------- Operating Profit $ 4,505 $ 4,531 -0.6% - -------------------------------------------------------------------------------- Revenue increased 4.3% in the 2000 first quarter to $28.9 million compared with $27.7 million in the 1999 first quarter. Operating profit remained flat in the 2000 first quarter compared to the 1999 first quarter. While revenues rose, total expenses increased, principally from the March launch of Golf Digest Woman and higher paper costs. New York Times Digital: New York Times Digital ("NYTD group") is the Company's Internet business division, which consists of NYTimes.com, Boston.com, NYToday.com, WineToday.com, GolfDigest.com and Abuzz. Abuzz develops and deploys technology to enable online communities to share knowledge, interests and experience. - ------------------------------------------------------------------------------ For the Quarters Ended --------------------------------------------- March 26, March 28, (Dollars in thousands) 2000 1999 % Change - ------------------------------------------------------------------------------ Revenues $ 11,569 $ 3,823 202.6% - ------------------------------------------------------------------------------ EBITDA $ (7,632) $ (4,799) -59.0% - ------------------------------------------------------------------------------ Operating loss $(10,049) $ (5,100) -97.0% - ------------------------------------------------------------------------------ NYTD group revenues for the first quarter of 2000 were $11.6 million compared with $3.8 million in the first quarter of 1999. The $7.8 million increase in 2000 revenues was primarily due to strong growth in advertising volume. Advertising revenue accounts for 90% of NYTD group total revenues for the first quarter of 2000 and 1999. Operating loss for the 2000 first quarter was $10.0 million compared with $5.1 million in the first quarter of 1999. The $4.9 million increase was the result of increased staffing, advertising, promotion and the acquisition of Abuzz Technologies, Inc., which was acquired in July 1999. The Company anticipates that costs for each quarter for the remainder of 2000 associated with the NYTD group will continue to increase over the 2000 first quarter, depending on the timing and extent of various marketing expenses and initiatives. Liquidity and Capital Resources Net cash provided by operating activities was $148.7 million in the 2000 first quarter compared with $121.0 million in the 1999 first quarter. The increase of $27.7 million was primarily due to improved earnings. Net cash used in investing activities was $317.1 million in the first quarter of 2000 compared with $15.2 million in the 1999 first quarter. The increase of $301.9 million was primarily due to the acquisition of the T&G. Net cash provided by financing activities was $140.6 million in the first quarter of 2000 compared with $102.0 million used in financing activities in the 1999 first quarter. The increase of $242.6 million was primarily related to increases in commercial paper outstanding used to fund the T&G acquisition. The Company believes that cash generated from its operations and the availability of funds from external sources should be adequate to cover all cash requirements, including working capital needs, stock repurchases, planned capital expenditures and acquisitions, and dividend payments to stockholders. The ratio of current assets to current liabilities was 63% at March 26, 2000, and 73% at March 28, 1999. This decrease is principally due to an increase in commercial paper outstanding at March 26, 2000, mostly resulting from the funding of the T&G acquisition. The ratio of long-term debt and capital lease obligations as a percentage of total capitalization was 31% at March 26, 2000, compared with 30% at March 28, 1999. 19 Financing: The Company's total debt, including commercial paper and capital leases, was $979.7 million at March 26, 2000, and $785.8 million at March 28, 1999. The increase in total debt was primarily from an increase in commercial paper outstanding and the issuance of additional medium-term notes to fund stock repurchases and the acquisition of the T&G. On April 28, 2000, $100.0 million of debt was repaid; the remainder of the Company's debt and capital leases generally mature between March 2003 and March 2025. The Company has $400.0 million available under its revolving credit agreements. These agreements require, among other provisions, specified levels of stockholders' equity. A revolving credit agreement for $200.0 million expires in June 2000, which date the Company intends to extend, and an additional revolving credit agreement for $200.0 million expires in July 2002. The Company had $239.2 million in commercial paper outstanding at March 26, 2000, and $186.5 million at March 28, 1999, which obligations are supported by these revolving credit agreements. No amounts are outstanding under these revolving credit agreements as of March 26, 2000. The amount available under the commercial paper program was $160.8 million as of March 26, 2000. Approximately $429.3 million of stockholders' equity was unrestricted under these agreements at March 26, 2000, and $583.2 million was unrestricted at March 28, 1999. The decline in the level of unrestricted stockholders' equity was primarily due to stock repurchases. In March 2000 the Company issued $40.0 million of 7% subordinated notes due March 21, 2003, to three venture capital firms. After the consummation of a proposed initial public offering of a new class of stock, this debt will be convertible, at the election of the venture capital firms, into shares of a new class of stock intended to represent approximately 6.7% of the pre-offering equity of the NYTD group. If there is no offering, this debt will not be convertible. The Company has agreed to give the venture capital firms piggyback and demand registration rights for the new class of stock issued upon conversion (see Proposed Tracking Stock below). Capital Expenditures: The Company currently estimates that capital expenditures for 2000 will range from $120.0 million to $140.0 million. The Company currently anticipates that depreciation and amortization expense will approximate $215.0 million for 2000 compared with $197.5 million in 1999. Proposed Tracking Stock On January 20, 2000, the Board of Directors of the Company authorized, subject to shareholder approval, the issuance of a new class of stock (Class C Stock). On January 28, 2000, the Company filed a registration statement with the SEC on Form S-3 (the "Form S-3") related to a proposed initial public offering of Class C Stock, which is intended to track the performance of the Company's Internet business division, the NYTD group. This Form S-3 has not yet become effective. At the Annual Meeting of Stockholders to be held on May 23, 2000, stockholders of record as of the close of business on April 6, 2000, are entitled to vote on the proposal to create this new class of stock. The Company separates for financial reporting purposes the NYTD group and the "NYT group" (the Company excluding the NYTD group) except for a retained interest in the NYTD group (see Note 11 of the Notes to the Consolidated Financial Statements). The NYT group includes all of the other business segments of the Company: Newspaper, Broadcast and Magazines, except for the businesses that comprise the NYTD group. The NYT group also includes a retained interest in the NYTD group which is currently 100%. This retained interest will decline to reflect the issuance of Class C Stock. The NYTD group includes NYTimes.com NYToday.com, Boston.com, WineToday.com, GolfDigest.com and Abuzz. The NYTD group's operating results as presented in the financial statements included in Note 11 of Notes to the Condensed Consolidated Financial 20 Statements reflect the effect of various inter-group arrangements and policies for license fees, inter-group services and income taxes. Beginning in 2000, and coinciding with the effective date of these various arrangements (January 1, 2000), the Company's management has determined that its reportable segments consist of Newspapers, Broadcast, Magazines and the operations of the NYTD group. These segments will be evaluated regularly by key management in assessing performance and allocating resources. Factors That Could Affect Operating Results Except for the historical information contained herein, the matters discussed in this quarterly report are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those predicted by such forward-looking statements. These risks and uncertainties include national and local conditions, as well as competition, that could influence the levels (rate and volume) of retail, national and classified advertising and circulation generated by the Company's various markets and material increases in newsprint and magazine paper prices. They also include other risks detailed from time to time in the Company's publicly-filed documents, including the Company's Annual Report on Form 10-K for the period ended December 26, 1999. Item 3. Quantitative and Qualitative Disclosures about Market Risk The Company's quantitative and qualitative market risk is principally associated with market interest rate fluctuations related to its debt obligations. The Company does not consider such market risk significant. 21 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 3.2 By-laws as amended through April 27, 2000 12 Ratio of Earnings to Fixed Charges 27 Financial Data Schedule (b) Reports on Form 8-K No reports on Form 8-K have been filed during the period for which this report is filed. 22 SIGNATURES Pursuant to the requirements 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 NEW YORK TIMES COMPANY -------------------------- (Registrant) Date: May 10, 2000 /s/ John M. O'Brien ------------ --------------------------- John M. O'Brien Senior Vice President and Chief Financial Officer (Principal Financial Officer) 23 Exhibit Index to Quarterly Report Form 10-Q Quarter Ended March 26, 2000 Exhibit No. Exhibit - ----------- ------- 3.2 By-laws as amended through April 27, 2000 12 Ratio of Earnings to Fixed Charges 27 Financial Data Schedule 24 EX-3.2 2 BY-LAWS EXHIBIT 3.2 THE NEW YORK TIMES COMPANY BY-LAWS As Amended by the Board of Directors October 21, 1968, February 26, 1969, March 24, 1971, March 29, 1972, March 28, 1973, May 30, 1973, November 28, 1973, March 27, 1974, March 31, 1976, April 26, 1977, January 30, 1978, October 25, 1978, April 3, 1979, July 23, 1979, March 20, 1980, May 15, 1980, March 19, 1981, March 18, 1982, February 17, 1983, April 28, 1983, February 16, 1984, July 18, 1985, February 20, 1986, April 30, 1986, October 16, 1986, February 19, 1987, February 18, 1988, March 16, 1989, February 15, 1990, February 21, 1991, February 20, 1992, February 18, 1993, October 21, 1993, December 16, 1993, February 17, 1994, February 16, 1995, March 20, 1997, October 16, 1997, February 19, 1998, May 21, 1998, and April 27, 2000. As Ratified by the Class B Stockholders April 22, 1969 and the Class A and Class B Stockholders (Article XI only) April 19, 1988 BY-LAWS OF THE NEW YORK TIMES COMPANY
As Amended by the Board of Directors October 21, 1968 As Ratified by the February 26, 1969 Class B Stockholders March 24, 1971 April 22, 1969 March 29, 1972 and the Class A and March 28, 1973 Class B Stockholders May 30, 1973 (Article XI only) November 28, 1973 April 19, 1988 March 27, 1974 March 31, 1976 April 26, 1977 January 30, 1978 October 25, 1978 April 3, 1979 July 23, 1979 March 20, 1980 May 15, 1980 March 19, 1981 March 18, 1982 February 17, 1983 April 28, 1983 February 16, 1984 July 18, 1985 February 20, 1986 April 30, 1986 October 16, 1986 February 19, 1987 February 18, 1988 March 16, 1989 February 15, 1990 February 21, 1991 February 20, 1992 February 18, 1993 October 21, 1993 December 16, 1993 February 17, 1994 February 16, 1995 March 20, 1997 October 16, 1997 February 19, 1998 May 21, 1998 April 27, 2000
INDEX
PAGE -------- ARTICLE I. STOCKHOLDERS................................................ 1 1. Annual Meeting........................................... 1 2. Special Meetings......................................... 1 3. Notice of Meetings....................................... 1 4. Quorum................................................... 1 5. Voting................................................... 1 ARTICLE II. CLOSING TRANSFER BOOKS; SETTING RECORD DATE................. 2 1. Qualification of Voters.................................. 2 2. Determination of Stockholders of Record for Other 2 Purposes.................................................. ARTICLE III. BOARD OF DIRECTORS.......................................... 2 1. Number, Classification, Election and Qualifications...... 2 2. Vacancies................................................ 2 3. Regular Meetings......................................... 2 4. Special Meetings......................................... 3 5. Quorum................................................... 3 6. Committees............................................... 3 7. Salaries................................................. 3 8. Resignation.............................................. 4 9. Telephonic Meetings...................................... 4 ARTICLE IV. OFFICERS.................................................... 4 1. Appointment.............................................. 4 2. Term of Office........................................... 4 3. The Chairman of the Board................................ 4 4. The Vice Chairman of the Board........................... 4 5. The President............................................ 4 6. Vice Presidents.......................................... 5 7. The Secretary............................................ 5 8. The Treasurer............................................ 5 9. Duties of Officers may be Delegated...................... 5 ARTICLE V. STOCK CERTIFICATES.......................................... 5 1. Issuance of Stock Certificates........................... 5 2. Lost Stock Certificates.................................. 5 3. Transfers of Stock....................................... 5 4. Regulations.............................................. 6 ARTICLE VI. SEAL........................................................ 6 ARTICLE VII. CHECKS...................................................... 6 ARTICLE VIII. BOOKS OF ACCOUNT AND STOCK BOOK............................. 6 ARTICLE IX. FISCAL YEAR................................................. 6 ARTICLE X. VOTING SECURITIES........................................... 6 ARTICLE XI. INDEMNIFICATION............................................. 7 1. Directors and Officers................................... 7 2. Non-Exclusivity.......................................... 7
ii
PAGE -------- 3. Continuity of Rights..................................... 7 ARTICLE XII. INTEREST OF DIRECTORS AND OFFICERS IN CONTRACTS WITH THE 7 COMPANY..................................................... ARTICLE XIII. NOTICES..................................................... 8 ARTICLE XIV. AMENDMENT................................................... 8
iii THE NEW YORK TIMES COMPANY BY-LAWS ARTICLE I STOCKHOLDERS 1. ANNUAL MEETING. The Annual Meeting of Stockholders for the election of directors and for the transaction of such other business as may properly come before the meeting shall be held on such date, at such time and place either within or without the State of New York as may be specified by the Board of Directors. 2. SPECIAL MEETINGS. Special meetings of the stockholders, to be held at such place either within or without the State of New York and for the purpose or purposes as may be specified in the notices of such meetings, may be called by the Chairman of the Board or the President and shall be called by the President or the Secretary at the request of a majority of the Board of Directors or of stockholders owning 25 per cent or more of the shares or stock of the Company issued and outstanding and entitled to vote on any action proposed by such stockholders for such meetings. Such request shall be in writing and shall state the purpose or purposes of the proposed meeting. 3. NOTICE OF MEETINGS. Notice of the time, place and purpose or purposes of every meeting of stockholders shall be in writing, signed by the President or the Secretary, and shall be mailed by the Secretary, or the person designated by him to perform this duty, at least ten, and not more than sixty, days before the meeting, to each stockholder of record entitled to vote at such meeting and to each stockholder of record who would be entitled to have his stock appraised if the action proposed at such meeting were taken. Such notice shall be directed to a stockholder at his address as it appears on the stock book, unless he shall have filed with the Secretary a written request that notices intended for him be mailed to some other address, in which case it will be mailed to the address designated in such request. 4. QUORUM. The holders of record of a majority of the shares of stock issued and outstanding and entitled to vote thereat, present in person or by proxy, shall be requisite and shall constitute a quorum at each meeting of stockholders for the transaction of business, except as otherwise provided by law, by the Certificate of Incorporation or by these By-laws; provided that, when any specified action is required to be voted upon by a class of stock voting as a class, the holders of a majority of the shares of such class shall be requisite and shall constitute a quorum for the transaction of such specified action. If, however, there shall be no quorum, the officer of the Company presiding as chairman of the meeting shall have the power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present, when any business may be transacted which might have been transacted at the meeting as first convened had there been a quorum. 5. VOTING. Each stockholder entitled to vote on any action proposed at a meeting of stockholders shall be entitled to one vote in person or by proxy for each share of voting stock held of record by him. Execution of a proxy may be accomplished by the stockholder or the stockholder's authorized officer, director, employee or agent. Proxies may be executed by facsimile signature or transmitted by telegram, cablegram or other means of electronic transmission authorized by the stockholder to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such telegram, cablegram or other means of electronic transmission must either set forth or be submitted with information from which it can be reasonably determined that the telegram, cablegram or other electronic transmission was authorized by the 1 stockholder. No proxy shall be valid after the expiration of eleven months from the date of its execution, unless the person executing it shall have specified therein its duration. The vote for directors shall be by ballot, and the election of each director shall be decided by a plurality vote. Except as otherwise provided by law, by the Certificate of Incorporation, by other certificate filed pursuant to law or by these By-laws, votes on any other matters coming before any meeting of stockholders shall be decided by the vote of the holders of a majority of the shares represented at such meeting, in person or by proxy, and entitled to vote on the specific matter. Except as required by law, by the Certificate of Incorporation, by other certificate filed pursuant to law or by these By-laws, the chairman presiding at any meeting of stockholders may rule on questions of order or procedure coming before the meeting or submit such questions to the vote of the meeting, which vote may at his direction be by ballot. The chairman shall submit any such questions to the vote of the meeting at the request of any stockholder entitled to vote present in person or by proxy at the meeting, which vote shall be by ballot. ARTICLE II CLOSING TRANSFER BOOKS; SETTING RECORD DATE 1. QUALIFICATION OF VOTERS. The Board of Directors may fix a date, which shall not be more than sixty days, nor fewer than 10 days prior to the date of any meeting of the stockholders or prior to the last day on which the consent or dissent of stockholders may be effectively expressed for any purpose without a meeting, as the record date for the determination of stockholders entitled to notice of and to vote at such a meeting or whose consent or dissent is required or may be expressed for any purpose, as the case may be, shall be determined, and all persons who were holders of record of voting stock on the date so fixed and no others shall be entitled to notice of and to vote at such meeting or to express their consent or dissent, as the case may be. 2. DETERMINATION OF STOCKHOLDERS OF RECORD FOR OTHER PURPOSES.The Board of Directors may fix a date, which shall not be more than sixty days, nor fewer than 10 days preceding the date fixed for the payment of any dividend or for the making of any distribution or for the delivery of evidences of rights or evidences of interests arising out of any change, conversion or exchange of capital stock, as the record date for the determination of the stockholders entitled to receive any such dividend, distribution, rights or interests, and in such case only stockholders of record on the date so fixed shall be entitled to receive such dividend, distribution, rights or interests. ARTICLE III BOARD OF DIRECTORS 1. NUMBER, CLASSIFICATION, ELECTION AND QUALIFICATIONS.The affairs of the Company shall be managed by a Board of Directors consisting of not fewer than three nor more than eighteen members. The number of directors shall be determined from time to time by resolution of a majority of the entire Board of Directors then in office, provided that no decrease in the number of directors shall shorten the term of any incumbent director. For the purpose of election of directors only, and not for any other purpose, the directors shall be divided into two classes, the holders of Class A Common Stock are entitled to elect 30% of the Board of Directors proposed to be elected at any meeting of stockholders held for that purpose (or the nearest larger whole number if such percentage is not a whole number), to be designated the Class A directors, and the holders of Class B Common Stock are entitled to elect the balance of the Board of Directors proposed to be elected at any such meeting, to be designated the Class B directors. The directors shall, except as provided in Section 2 of this Article III, be elected by the classes of shares entitled to elect them, by ballot at each annual meeting 2 of stockholders, and shall hold office until the next annual meeting of stockholders and until their successors shall be elected and qualified. All directors must be at least eighteen years of age and at least one shall be a citizen of the United States and a resident of New York State. 2. VACANCIES. Any vacancy in the Board of Directors, whether caused by resignation, death, increase in the number of directors, disqualification or otherwise, may be filled by a majority of the directors in office after the vacancy has occurred, although less than a quorum. A director so elected shall hold office for the unexpired term in respect of which such vacancy occurred. 3. REGULAR MEETINGS. A regular meeting of the Board shall be held in each year immediately following the Annual Meeting of Stockholders or if such meeting be adjourned, the final adjournment thereof at the same place as such meeting of stockholders. No notice of such meeting shall be necessary to the newly elected directors in order to legally constitute the meeting. Other regular meetings of the Board may be held at such time and place, either within or without the State of New York, as shall from time to time be determined by a resolution of the Board. Any business may be transacted at any regular meeting at which a quorum is present. The time and place of any such regular meeting may be changed (i) at the preceding regular meeting; or (ii) subsequent to the adjournment of the preceding regular meeting by consent in writing signed by a majority of the whole Board; provided, however, that in either case notice of such change be given to each director personally or by telegram, facsimile transmission or comparable means two days or by mail five days prior to the date originally designated for such regular meeting. 4. SPECIAL MEETINGS. A special meeting of the Board of Directors may be held at the time fixed by resolution of the Board or upon call of the Chairman of the Board, the President or any two directors and may be held at any place within or without the State of New York. Except as otherwise provided by law, by the Certificate of Incorporation, by other certificate filed pursuant to law or by these By-laws, notice of the time and place of any special meeting of the Board shall be given by the Secretary or other person designated by him to perform this duty by giving the same personally or by telegram, facsimile transmission or comparable means to each director at his address as the same shall appear on the books of the Company at least two days previous to such meeting or by mailing a copy of such notice, postage prepaid, to each director at such address at least five days previous to such meeting; provided, however, that no notice need be given to any director if waived by him either before or after the meeting or if he shall be present at such meeting, and any meeting of the Board may be held at any time without notice if all the directors then in office shall be present thereat. Any such notice shall also state the items of business which are expected to come before the meeting, and the items of business transacted at any special meeting of the Board shall be limited to those stated in such notice, unless all the directors are present at the meeting, or all those absent consent in writing either before or after the meeting, to the transaction of an item or items of business not stated in such notice. 5. QUORUM. At all meetings of the Board, the presence of at least one-third of the directors in office shall be necessary and sufficient to constitute a quorum for the transaction of business, and, except as otherwise required by law, by the Certificate of Incorporation, by other certificate filed pursuant to law or by these By-laws, the affirmative vote of a majority of the directors present at any meeting at which a quorum is present shall be necessary for the adoption of any business or resolution which may come before the meeting; provided, however, that in the absence of a quorum a majority of the directors present or any director solely present may adjourn any meeting from time to time until a quorum is present. No notice of any adjournment to a later hour on the date originally designated for the holding of a meeting need be given, but immediate notice by telegram, facsimile transmission or comparable means shall be given by the Secretary or other person designated by him to perform this duty to all directors of any adjournment to any subsequent date, and such notice shall be deemed sufficient, though less than the notice required by Section 3 if such meeting be an adjourned regular meeting of the Board, or by Section 4 if such meeting be an adjourned special meeting of the Board. 3 6. COMMITTEES. The Board of Directors may by resolution or resolutions passed by a majority of the whole Board designate one or more committees, each committee to consist of three or more of the directors, which, to the extent provided in said resolution or resolutions, shall have and may exercise powers of the Board of Directors in the management of the business and affairs of the Company and may have power to authorize the seal of the Company to be affixed to all papers which may require it. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board of Directors. All committees so appointed shall keep regular minutes of the business transacted at their meetings. 7. SALARIES. Directors, as such, shall not receive any stated salary for their services, provided that, by resolution of the Board, the Board of Directors shall have authority to fix the compensation of directors and provide for the reimbursement of expenses of attending meetings; provided further that nothing herein contained shall be construed to preclude any director from serving the Company in any other capacity and receiving compensation therefor. Members of committees may be allowed such compensation as may be fixed from time to time by the Board for attending committee meetings and reimbursement of expenses of attendance. 8. RESIGNATION. Any director may, at any time, resign, such resignation to take effect upon receipt of written notice thereof by the President or the Secretary, unless otherwise stated in the resignation. 9. TELEPHONIC MEETINGS. One or more directors may participate in a meeting of the Board of Directors, or a committee designated pursuant to Section 6 of this Article III, by a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear and speak to each other. Participation in a meeting pursuant to this provision shall constitute actual attendance at such meeting. ARTICLE IV OFFICERS 1. APPOINTMENT. The Board of Directors may appoint from their number a Chairman of the Board and a Vice Chairman of the Board. The Board of Directors shall appoint a President, a Secretary and a Treasurer and may also appoint one or more Vice Presidents, none of whom need be members of the Board, and may from time to time appoint such other officers as they may deem proper. The Chairman, President or Vice Chairman may appoint one or more Vice Presidents, the Secretary, the Treasurer, or any Assistant Secretary or Assistant Treasurer. Any two of the aforesaid offices, except those of President and Vice President, or President and Secretary, may be filled by the same person. The compensation of all officers of the Company shall be fixed by the Board. 2. TERM OF OFFICE. The officers of the Company shall hold office at the pleasure of the Board of Directors. Any officer may be removed from office at any time for or without cause by the affirmative vote of a majority of the whole Board of Directors. Any officer may resign his office at any time, such resignation to take effect upon receipt of written notice thereof by the Company, unless otherwise stated in the resignation. If the office of any officer becomes vacant for any reason, the vacancy may be filled by the Board or in the case of any Vice President, the Secretary or the Treasurer, or any Assistant Secretary or Assistant Treasurer, the vacancy may be filled by any two of the Chairman, President or Vice Chairman. 3. THE CHAIRMAN OF THE BOARD. The Chairman of the Board shall preside at all meetings of the Board of Directors and all meetings of the stockholders. He shall have final authority, subject to the control of the Board of Directors, over the general policy and business of the Company, and shall have such other powers and duties as may from time to time be prescribed by the Board of Directors. 4 4. THE VICE CHAIRMAN OF THE BOARD. The Vice Chairman of the Board shall have such powers and duties as may from time to time be prescribed by the Board of Directors or by the Chairman of the Board. In the absence or inability to act of the Chairman of the Board, the Vice Chairman of the Board shall preside at all meetings of the Board of Directors and all meetings of the stockholders. 5. THE PRESIDENT. The President shall be the chief executive officer of the Company and as such shall have the general control and management of the business and affairs of the Company subject, however, to the control of the Chairman of the Board. The President shall have the power, subject to the control of the Chairman of the Board, to appoint or discharge and to prescribe the duties and to fix the compensation of such agents and employees of the Company as he may deem necessary. He shall have, as does the Chairman of the Board, the authority to make and sign bonds, mortgages and other contracts and agreements in the name and on behalf of the Company, except when the Board of Directors by resolution instructs the same to be done by some other officer or agent. He shall see that all orders and resolutions of the Board of Directors are carried into effect and shall perform all other duties necessary to his office or properly required of him by the Board of Directors subject, however, to the right of the directors to delegate any specific powers, except such as may by statute be exclusively conferred upon the President, to any other officer or officers of the Company. In the absence or inability to act of the Chairman of the Board, the President shall have the duties prescribed for the Chairman of the Board subject, however, to Section 4 of this Article IV. 6. VICE PRESIDENTS. Each Vice President shall have such powers and perform such duties as may be assigned to him from time to time by the Chairman of the Board or the President. 7. THE SECRETARY. The Secretary shall attend all sessions of the Board and all meetings of the stockholders and record all votes and the minutes of all proceedings in a book to be kept for that purpose, and shall perform like duties for committees when required. He shall give, or cause to be given, notice of all meetings of the stockholders and meetings of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors or the President. He shall keep in safe custody the seal of the Company and shall see that it is affixed to all documents, the execution of which, on behalf of the Company, under its seal, is necessary or proper, and when so affixed may attest the same. 8. THE TREASURER. The Treasurer shall, if required by the Board of Directors, give a bond for the faithful discharge of his duties in such amount and with such surety or sureties as the Board of Directors may determine; the cost of any such bond, and any expenses incurred in connection therewith, shall be borne by the Company. He shall have the custody of the corporate funds and securities, except as otherwise provided by the Board, and shall cause to be kept full and accurate accounts of receipts and disbursements in books belonging to the Company and shall deposit all moneys and other valuable effects in the name and to the credit of the Company in such depositories as may be designated by the Board of Directors. He shall disburse the funds of the Company as may be ordered by the Board, taking proper vouchers for such disbursements, and shall render to the President and the directors, at the regular meetings of the Board, or whenever they may require it, an account of all his transactions as Treasurer and of the financial condition of the Company. 9. DUTIES OF OFFICERS MAY BE DELEGATED. In the case of the absence of any officer, or for any other reason that the Board may deem sufficient, the President or the Board may delegate for the time being the powers or duties of such officer to any other officer or to any director. ARTICLE V STOCK CERTIFICATES 1. ISSUANCE OF STOCK CERTIFICATES. The Capital Stock of the Company shall be represented by certificates signed by the Chairman or the President or a Vice President and by the Secretary or an 5 Assistant Secretary or the Treasurer or an Assistant Treasurer and sealed with the seal of the Company. Such seal may be a facsimile, engraved or printed and where any such certificate is signed by a transfer agent registered by a registrar other than the Company or an employee of the Company or the shares represented by such certificate are listed on a national security exchange, the signatures of any officers appearing thereon may be facsimiles, engraved or printed. 2. LOST STOCK CERTIFICATES. The Board of Directors may by resolution adopt, from time to time, such regulations concerning the issue of any new or duplicate certificates for lost, stolen or destroyed stock certificates of the Company as shall not be inconsistent with the provisions of the laws of the State of New York as presently in effect or as they may hereafter be amended. 3. TRANSFERS OF STOCK. Transfers of stock shall be made only on the stock transfer books of the Company, and, except in the case of any such certificate which has been lost, stolen or destroyed, in which case the resolutions of the Board then in effect respecting lost, stolen or destroyed stock certificates shall be complied with, such transfer shall only be made upon surrender to the Company of a certificate for shares for cancellation duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer. Upon the issue of a new certificate to the person entitled thereto, the Company shall cancel the old certificate and record the transaction upon its books. 4. REGULATIONS. Except to the extent that the exercise of such power shall be prohibited or circumscribed by these By-laws, by the Certificate of Incorporation, or other certificate filed pursuant to law, or by statute, the Board of Directors shall have power to make such rules and regulations concerning the issuance, registration, transfer and cancellation of stock certificates as it shall deem appropriate. ARTICLE VI SEAL The seal of the Company shall be circular in form, shall bear the legend: "The New York Times Company--1851 Inc. 1896" and shall contain in the center the Roman letter T. ARTICLE VII CHECKS All checks or demands for money and notes of the Company shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate. ARTICLE VIII BOOKS OF ACCOUNT AND STOCK BOOK The Company shall keep at its principal office correct books of account of all its business and transactions. A book to be known as the stock book, containing the names alphabetically arranged, of all persons who are stockholders of the Company, showing their addresses, the number and class of shares of stock held by them respectively and the times when they respectively became the owners thereof shall be kept at the principal office of the Company or its transfer agent. 6 ARTICLE IX FISCAL YEAR The fiscal year of the Company shall be the calendar year unless otherwise provided by the Board of Directors. ARTICLE X VOTING SECURITIES Unless otherwise ordered by the Board of Directors, the Chairman, the President or the Vice Chairman, or, in the event of their absence or inability to act, the Vice Presidents, in order of seniority or priority established by the Board or by the President, unless and until the Board shall otherwise direct, shall have full power and authority on behalf of the Company to attend and to act and to vote, or to execute in the name and on behalf of the Company a proxy authorizing an agent or attorney-in-fact for the Company to attend and to act and to vote at any meetings of security holders of corporations in which the Company may hold securities, and at such meetings he or his duly authorized agent or attorney-in-fact shall possess and may exercise any and all rights and powers incident to the ownership of such securities, and which as the owner thereof the Company might have possessed and exercised, if present. The Board of Directors by resolution from time to time may confer like powers upon any other person or persons. ARTICLE XI INDEMNIFICATION 1. DIRECTORS AND OFFICERS. The Company shall, to the fullest extent permitted by applicable law as the same exists or may hereafter be in effect, indemnify any person who is or was made or threatened to be made a party to or is involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, including an action by or in the right of the Company to procure a judgment in its favor and an action by or in the right of any other corporation of any type or kind, domestic or foreign, or any partnership, joint venture, trust, employee benefit plan or any other entity, which any director or officer of the Company is serving, has served or has agreed to serve in any capacity at the request of the Company, by reason of the fact that such person or such person's testator or intestate is or was or has agreed to become a director or officer of the Company, or is or was serving or has agreed to serve such other corporation, partnership, joint venture, trust, employee benefit plan or other entity in any capacity, against judgments, fines, amounts paid or to be paid in settlement, taxes or penalties, and costs, charges and expenses, including attorneys' fees, incurred in connection with such action or proceeding or any appeal therein; provided, however, that no indemnification shall be provided to any such person if a judgment or other final adjudication adverse to the director or officer establishes that (i) his or her acts were committed in bad faith or were the result of active and deliberate dishonesty and, in either case, were material to the cause of action so adjudicated or (ii) he or she personally gained in fact a financial profit or other advantage to which he or she was not legally entitled. 2. NON-EXCLUSIVITY. Nothing contained in this Article XI shall limit the right to indemnification and advancement of expenses to which any person would be entitled by law in the absence of this Article, or shall be deemed exclusive of any other rights to which such person seeking indemnification or advancement of expenses may have or hereafter may be entitled under law, any provision of the Certificate of Incorporation, or By-laws, any agreement approved by the Board of Directors, or a resolution of stockholders or directors; and the adoption of any such resolution or entering into of any such agreement approved by the Board of Directors is hereby authorized. 7 3. CONTINUITY OF RIGHTS. The indemnification and advancement of expenses provided by, or granted pursuant to, this Article XI shall (i) apply with respect to acts or omissions occurring prior to the adoption of this Article XI to the fullest extent permitted by law and (ii) survive the full or partial repeal or restrictive amendment hereof with respect to events occurring prior thereto. ARTICLE XII INTEREST OF DIRECTORS AND OFFICERS IN CONTRACTS WITH THE COMPANY A director or officer of the Company shall not be disqualified by his office from dealing or contracting with the Company either as a vendor, purchaser or otherwise, nor shall any transaction or contract of the Company be void or voidable by reason of the fact that any director or officer or any firm of which any director or officer is a member or any corporation or other entity of which any director or officer is a shareholder, officer or director or has a substantial interest, is in any way interested in such transaction or contract, provided that such transaction or contract is or shall be authorized, ratified or approved either (1) by a vote of a majority of a quorum of the Board of Directors, without counting in such majority any director so interested or member of a firm so interested, or a shareholder, officer or director or holder of substantial interest of a corporation so interested, or, if the disinterested directors are less than a majority of the directors present at such meeting, by unanimous vote of the disinterested directors and, in each case, the common or interested directors may be counted in determining the presence of a quorum at such meeting, or (2) by the written consent, or by the vote at any stockholders' meeting of the holders of record of a majority of all the outstanding shares of stock of the Company entitled to vote on such transaction or contract; nor shall any director or officer be liable to account to the Company for any profits realized by or from or through any such transaction or contract of the Company authorized, ratified or approved as aforesaid by reason of the fact that he, or any firm of which he is a member or any corporation of which he is a shareholder, officer or director, was interested in such transaction or contract. Nothing herein contained shall create liability in the events above described or prevent the authorization, ratification or approval of such transactions or contracts in any other manner permitted by law. ARTICLE XIII NOTICES Whenever, under the provisions of these By-laws, notice is required to be given to any director, officer, or stockholder, it shall not be construed to mean personal notice, but unless otherwise expressly stated in these By-laws, such notice may be given in writing by depositing the same, with postage pre-paid, in a post office or official depositary under the exclusive care and custody of the United States Postal Service, addressed to such stockholder, officer or director, at such address as appears on the books of the Company, and such notice shall be deemed to have been given at the time when the same was thus mailed. ARTICLE XIV AMENDMENT These By-laws may be amended, altered, changed, added to or repealed by a majority vote of all the Class B Common Stock issued and outstanding and entitled to vote at any annual or special meeting of the stockholders, provided that such amendments are not inconsistent with any provisions of the Company's Certificate of Incorporation. The Board of Directors, at any regular or at any special meeting, by a majority vote of the whole Board, may amend, alter, change, add to or repeal these By-laws, provided that such amendments are 8 not inconsistent with any provisions of the Company's Certificate of Incorporation, and provided further that if any By-law regulating an impending election of directors is adopted or amended or repealed by the Board, there shall be set forth in the notice of the next stockholders meeting for the election of directors the By-laws so adopted or amended or repealed, together with a concise statement of the changes made. 9 EX-27 3 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the Consolidated Condensed Financial Statements as of and for the quarter ended March 26, 2000 an is qualified in its entirety by reference to such financial statements. 1,000 3-MOS DEC-31-2000 DEC-27-1999 MAR-26-2000 36,110 0 404,629 41,085 31,237 590,102 2,244,530 1,008,375 3,742,601 935,798 0 0 0 17,955 1,371,633 3,742,601 0 843,197 0 359,288 0 0 15,342 143,218 60,155 83,063 0 0 0 83,063 .48 .47
EX-12 4 RATIO OF EARNINGS TO FIXED CHARGES Exhibit 12 THE NEW YORK TIMES COMPANY Ratio of Earnings to Fixed Charges (Dollars in thousands, except ratio) (Unaudited)
Three Months Ended March 26, 2000 March 28, 1999 -------------- -------------- Earnings from continuing operations before fixed charges Income before income taxes, income from joint ventures $139,591 $103,345 Distributed earnings from less than fifty percent owned affiliates 2,703 1,475 -------- -------- Adjusted pre-tax earnings from continuing operations 142,294 104,820 Fixed charges 18,412 14,910 -------- -------- Earnings from continuing operations before fixed charges $160,706 $119,730 ======== ======== Fixed charges Interest expense $ 15,858 $ 12,342 Portion of rentals representative of interest factor 2,554 2,568 -------- -------- Total fixed charges $ 18,412 $ 14,910 ======== ======== Ratio of earnings to fixed charges 8.73 8.03 ======== ========
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