-----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, P46k2XmVwq1bpnD6j54/hD0kA6kYFCt06AVlBEGJPGDbYzTmKNVfnXsm2gX0bnXL 9nMPPiplGS3Tbb5gVRSKhA== 0001005477-99-003569.txt : 19990812 0001005477-99-003569.hdr.sgml : 19990812 ACCESSION NUMBER: 0001005477-99-003569 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990627 FILED AS OF DATE: 19990811 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: 99684385 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 June 27, 1999 ------------- 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 43D 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 August 6, 1999 (exclusive of treasury shares): Class A Common Stock 173,262,836 shares Class B Common Stock 849,602 shares PART I. FINANCIAL INFORMATION Item 1. Financial Statements THE NEW YORK TIMES COMPANY CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited) (Dollars and shares in thousands, except per share data)
Three Months Ended Six Months Ended ------------------------- ------------------------- June 27, June 28, June 27, June 28, 1999 1998 1999 1998 ------------------------- ------------------------- (13 Weeks) (26 Weeks) Revenues Advertising ................................... $ 562,467 $ 531,977 $ 1,085,268 $ 1,039,455 Circulation ................................... 173,003 170,503 345,560 340,025 Other ......................................... 43,915 46,710 87,615 92,273 ----------- ----------- ----------- ----------- Total ...................................... 779,385 749,190 1,518,443 1,471,753 ----------- ----------- ----------- ----------- Production costs Raw materials ................................. 82,463 88,745 169,783 176,523 Wages and benefits ............................ 152,228 148,269 294,300 289,502 Other ......................................... 102,537 97,472 202,941 198,443 ----------- ----------- ----------- ----------- Total ...................................... 337,228 334,486 667,024 664,468 Selling, general and administrative expenses ...... 287,296 269,590 581,317 545,801 ----------- ----------- ----------- ----------- Total ...................................... 624,524 604,076 1,248,341 1,210,269 ----------- ----------- ----------- ----------- Operating profit .................................. 154,861 145,114 270,102 261,484 Income from joint ventures ........................ 3,265 3,907 7,468 8,278 Interest expense - net ............................ 12,841 10,484 24,737 20,627 Gain on dispositions of assets .................... -- 8,000 -- 12,619 ----------- ----------- ----------- ----------- Income before income taxes and extraordinary item ............................ 145,285 146,537 252,833 261,754 Income taxes ...................................... 61,822 63,806 107,960 114,386 ----------- ----------- ----------- ----------- Income before extraordinary item .................. 83,463 82,731 144,873 147,368 Extraordinary item, net of tax: Debt extinguishment ........................... -- 7,716 -- 7,716 ----------- ----------- ----------- ----------- Net Income ........................................ $ 83,463 $ 75,015 $ 144,873 $ 139,652 =========== =========== =========== =========== Average number of common shares outstanding Basic ........................................ 176,083 191,530 177,885 192,060 Diluted ...................................... 179,331 196,138 181,225 196,474 Per share of common stock Basic earnings before extraordinary item ..... $ 0.47 $ 0.43 $ 0.81 $ 0.77 Extraordinary item, net of tax ............... -- (0.04) -- (0.04) =========== =========== =========== =========== Basic earnings after extraordinary item ...... $ 0.47 $ 0.39 $ 0.81 $ 0.73 =========== =========== =========== =========== Diluted earnings before extraordinary item ... $ 0.47 $ 0.42 $ 0.80 $ 0.75 Extraordinary item, net of tax ............... -- (0.04) -- (0.04) ----------- ----------- ----------- ----------- Diluted earnings after extraordinary item .... $ 0.47 $ 0.38 $ 0.80 $ 0.71 =========== =========== =========== =========== Dividends .................................... $ 0.105 $ 0.095 $ 0.200 $ 0.180 =========== =========== =========== ===========
See Notes to Consolidated Condensed Financial Statements. 2 THE NEW YORK TIMES COMPANY CONSOLIDATED CONDENSED BALANCE SHEETS (Dollars in thousands) June 27, December 27, 1999 1998 ---------- ------------ ASSETS (Unaudited) Current Assets Cash and short-term investments .................. $ 31,912 $ 35,991 Accounts receivable-net ......................... 342,533 331,933 Inventories Newsprint and magazine paper .................. 22,163 27,705 Work-in-process and other ..................... 5,836 4,582 ---------- ---------- Total inventories ......................... 27,999 32,287 Deferred income taxes ............................ 40,612 40,612 Other current assets ............................. 77,359 76,153 ---------- ---------- Total current assets ...................... 520,415 516,976 ---------- ---------- Other Assets Investments in joint ventures .................... 128,358 122,273 Property, plant and equipment (less accumulated depreciation of $961,952 in 1999 and $897,304 in 1998) ......................... 1,283,094 1,326,196 Intangible assets acquired Cost in excess of net assets acquired (less accumulated amortization of $255,610 in 1999 and $240,676 in 1998) ................. 948,413 963,347 Other intangible assets acquired (less accumulated amortization of $75,261 in 1999 and $64,746 in 1998) .................. 353,711 364,226 Miscellaneous assets ............................. 223,578 172,091 ---------- ---------- TOTAL ASSETS .................................... $3,457,569 $3,465,109 ========== ========== See Notes to Consolidated Condensed Financial Statements. 3 THE NEW YORK TIMES COMPANY CONSOLIDATED CONDENSED BALANCE SHEETS (Dollars in thousands) June 27, December 27, 1999 1998 ----------- ----------- LIABILITIES AND STOCKHOLDERS' EQUITY (Unaudited) Current Liabilities Commercial paper outstanding ................... $ 206,630 $ 124,100 Accounts payable ............................... 153,432 163,783 Accrued payroll and other related liabilities .. 83,030 87,265 Accrued expenses ............................... 170,474 166,761 Unexpired subscriptions ........................ 80,916 81,080 Current portion of long-term debt and capital lease obligations ................... 1,756 1,867 ----------- ----------- Total current liabilities ................... 696,238 624,856 ----------- ----------- Other Liabilities Long-term debt ................................. 513,965 513,695 Capital lease obligations ...................... 83,550 84,123 Deferred income taxes .......................... 177,117 165,268 Other .......................................... 581,916 545,697 ----------- ----------- Total other liabilities ..................... 1,356,548 1,308,783 ----------- ----------- Total liabilities ........................... 2,052,786 1,933,639 ----------- ----------- Stockholders' Equity Capital stock .................................. 18,863 18,661 Additional paid-in capital ..................... 28,282 -- Accumulated other comprehensive income (loss) .. 11,950 (2,609) Retained earnings .............................. 1,786,740 1,677,469 Common stock held in treasury, at cost ......... (441,052) (162,051) ----------- ----------- Total stockholders' equity .................. 1,404,783 1,531,470 ----------- ----------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ......... $ 3,457,569 $ 3,465,109 =========== =========== See Notes to Consolidated Condensed Financial Statements. 4 THE NEW YORK TIMES COMPANY CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (Dollars in thousands)
Six Months Ended ---------------------- June 27, June 28, 1999 1998 ---------------------- (26 Weeks) OPERATING ACTIVITIES Net cash provided by operating activities ...................... $ 228,290 $ 214,968 --------- --------- INVESTING ACTIVITIES Additions to property, plant and equipment ..................... (29,291) (37,601) Net proceeds from dispositions ................................. 11,434 9,934 Other-net ...................................................... (10,238) 5,865 --------- --------- Net cash used in investing activities .......................... (28,095) (21,802) --------- --------- FINANCING ACTIVITIES Commercial paper borrowings .................................... 82,530 494 Debt extinguishment ............................................ -- (75,616) Other long-term debt reduction ................................. (684) (2,184) Capital shares Issuances ................................................. 7,447 4,653 Repurchases ............................................... (257,965) (150,579) Dividends paid to stockholders ................................. (35,602) (34,517) --------- --------- Net cash used in financing activities .......................... (204,274) (257,749) --------- --------- Decrease in cash and short-term investments .................... (4,079) (64,583) Cash and short-term investments at the beginning of the year ... 35,991 106,820 --------- --------- Cash and short-term investments at the end of the quarter ...... $ 31,912 $ 42,237 ========= =========
SUPPLEMENTAL CASH FLOW INFORMATION NONCASH FINANCING AND INVESTING TRANSACTIONS 1. Repurchases of common stock in connection with noncash exercises under the Company's stock option plans increased treasury stock by $21.5 million in 1999 and $25.5 million in 1998. Additional paid-in capital was increased by a corresponding amount. The cost of shares reacquired in connection with taxes due from optionees on noncash exercises under the Company's stock option plans is included in repurchases in the consolidated condensed statements of cash flows above and amounted to $12.9 million in the first six months of 1999 and $17.7 million in the first six months of 1998. 2. In February 1999 the Company purchased a minority interest in TheStreet.com for $15.0 million, of which $3.0 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. 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 Consolidated Condensed Financial Statements. 5 THE NEW YORK TIMES COMPANY NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) 1. General The accompanying Notes to Consolidated Condensed 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 27, 1998, for The New York Times Company (the "Company") filed with the Securities and Exchange Commission. 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. Certain reclassifications have been made to the 1998 Consolidated Condensed Financial Statements to conform with classifications used at June 27, 1999. 2. Income Taxes Reconciliations between the effective rate on income before income taxes and extraordinary item, and the federal statutory rate are as follows:
- ---------------------------------------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended -------------------------------------------------------------------------------- June 27, 1999 June 28, 1998 June 27, 1999 June 28,1998 - ---------------------------------------------------------------------------------------------------------------------------------- % of % of % of % of (Dollars in thousands) Amount Pre-tax Amount Pre-tax Amount Pre-tax Amount Pre-tax - ---------------------------------------------------------------------------------------------------------------------------------- Tax at the federal statutory rate .............. $ 50,850 35.0% $ 48,488 35.0% $ 88,492 35.0% $ 87,197 35.0% State and local income taxes-net of federal benefit .............................. 8,249 5.7 9,296 6.7 14,355 5.7 16,817 6.8 Amortization of nondeductible intangible assets acquired .............................. 2,627 1.8 2,632 1.9 4,572 1.8 4,852 1.9 Other-net ...................................... 96 0.1 (96) (0.1) 541 0.2 7 0.0 -------------------------------------------------------------------------------- Subtotal ....................................... $ 61,822 42.6% $ 60,320 43.5% $107,960 42.7% $108,873 43.7% -------------------------------------------------------------------------------- Gain on dispositions of assets ................. -- -- 3,486 -- -- -- 5,513 -- -------------------------------------------------------------------------------- Income tax expense ............................. $ 61,822 -- $ 63,806 -- $107,960 -- $114,386 -- ================================================================================
3. Debt Obligations In July 1999 the availability of funds under a revolving credit agreement was increased to $200 million from $100 million, and that agreement expires in June 2000. An additional $200 million revolving credit agreement remains unchanged and expires in July 2002. The Company has a total of $400 million available under revolving credit agreements, which require, among other provisions, specified levels of stockholders' equity. 4. Stock Repurchase Program During the first six months of 1999, the Company repurchased 7,585,000 shares of Class A Common Stock at a cost of $245,103,000. The average price of these repurchases was $32 per share. On June 17, 1999, the Board of Directors authorized additional repurchase expenditures of up to $500,000,000. As of August 6, 1999, the remaining amount of repurchase authorizations from the Company's Board of Directors was $548,475,000. 6 5. Voluntary Staff Reductions The Company recorded work force reduction charges of $4,000,000 in the second quarter of 1999. No charges were recorded in the first quarter of 1999 or in the first six months of 1998. Staff reduction accruals included in accrued expenses on the Company's Consolidated Condensed Balance Sheets amounted to $18,944,000 at June 27, 1999, and $22,000,000 at December 27, 1998. Most of the accruals at June 27, 1999, will be paid within one year. 6. Comprehensive Income The Statement of Financial Accounting Standards ("FASB") No. 130, "Reporting Comprehensive Income" established standards for reporting comprehensive income and requires that all components of comprehensive income be presented in financial statements. Comprehensive income for the Company principally includes an unrealized gain on available-for-sale securities, as defined under FASB No. 115, "Accounting For Certain Investments in Debt and Equity Securities," as well as foreign currency translation adjustments, in addition to net income as reported in the Company's Consolidated Condensed Statements of Income. The unrealized appreciation on available-for-sale securities, which were purchased in 1999, were included in miscellaneous assets on the Company's Consolidated Condensed Balance Sheets and amounted to $24,968,000 as of June 27, 1999. Comprehensive income was $97,669,000 for the quarter ended June 27, 1999, and $159,432,000 for the first six months of 1999. For the quarter ended June 28, 1998, comprehensive income was $75,515,000 and for the first six months of 1998 was $140,152,000. The accumulated other comprehensive income (loss) on the Company's Consolidated Condensed Balance Sheets was net of a deferred income tax liability of $9,717,000 as of June 27, 1999, and net of a deferred income tax asset of $2,135,000 as of December 27, 1998. 7 7. Segment Statements of Income
- -------------------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended -------------------------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands) 1999 1998 1999 1998 - -------------------------------------------------------------------------------------------------------------- (13 Weeks) (26 Weeks) REVENUES Newspapers........................... $705,995 $671,786 $1,384,245 $1,329,116 Broadcast............................ 40,805 41,049 73,897 74,347 Magazines............................ 32,585 36,355 60,301 68,290 -------------------------------------------------------------------- Total.............................. $779,385 $749,190 $1,518,443 $1,471,753 ==================================================================== OPERATING PROFIT (LOSS) Newspapers........................... $143,814 $129,484 $ 256,175 $ 237,073 Broadcast............................ 14,705 13,610 21,691 20,894 Magazines............................ 8,107 12,003 12,576 20,321 Unallocated corporate expenses....... (11,765) (9,983) (20,340) (16,804) -------------------------------------------------------------------- Total.............................. 154,861 145,114 270,102 261,484 -------------------------------------------------------------------- Income from joint ventures........... 3,265 3,907 7,468 8,278 Interest expense, net................ 12,841 10,484 24,737 20,627 Gain on dispositions of assets....... -- 8,000 -- 12,619 -------------------------------------------------------------------- Income before income taxes and extraordinary item............. 145,285 146,537 252,833 261,754 Income taxes......................... 61,822 63,806 107,960 114,386 -------------------------------------------------------------------- Income before extraordinary item..... 83,463 82,731 144,873 147,368 Extraordinary item, net of tax: Debt extinguishment................ -- 7,716 -- 7,716 -------------------------------------------------------------------- NET INCOME........................... $ 83,463 $ 75,015 $ 144,873 $ 139,652 ====================================================================
See Management's Discussion and Analysis of Financial Condition and Results of Operations in this Form 10-Q for more details on the Company's reportable operating segments. 8. Dividend Rate Increase On June 17, 1999, the Board of Directors authorized a $.01 increase in the quarterly dividend payments on both Class A and B Common Stock effective with the September 1, 1999, record date. 9. Abuzz Acquisition On July 22, 1999, the Company acquired Abuzz Technologies, Inc. ("Abuzz"), an Internet knowledge management concern. The principal business of Abuzz involves a software solution that facilitates the building of online communities of interest by connecting people with questions to people with answers. This acquisition is not material to the Company's consolidated financial statements. 8 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Advertising revenues accounted for approximately 72% and circulation revenues accounted for 22% of the Company's revenues in the second quarter and first six months of 1999. 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 second quarter and the first six months of 1999 than in the comparable 1998 periods. The cost of newsprint during the remainder of 1999 is expected to be below that of 1998. The Company's consolidated financial results for the quarter and six months ended June 27, 1999, compared with the quarter and six months ended June 28, 1998, were as follows:
- ---------------------------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended ---------------------------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands, except per share data) 1999 1998 % Change 1999 1998 % Change - ---------------------------------------------------------------------------------------------------------------------- Revenues $779,385 $749,190 4.0% $1,518,443 $1,471,753 3.2% - ---------------------------------------------------------------------------------------------------------------------- Operating profit $154,861 $145,114 6.7% $ 270,102 $ 261,484 3.3% - ---------------------------------------------------------------------------------------------------------------------- Net Income before special items $ 85,755 $ 78,227 9.6% $ 147,165 $ 140,273 4.9% Special items (2,292) (3,212) N/A (2,292) (621) N/A - ---------------------------------------------------------------------------------------------------------------------- Net Income $ 83,463 $ 75,015 11.3% $ 144,873 $ 139,652 3.7% - ---------------------------------------------------------------------------------------------------------------------- Diluted earnings per share: Net Income before special items $ 0.48 $ 0.40 20.0% $ 0.81 $ 0.72 12.5% Special items (0.01) (0.02) N/A (0.01) (0.01) N/A - ---------------------------------------------------------------------------------------------------------------------- Diluted earnings per share $ 0.47 $ 0.38 23.7% $ 0.80 $ 0.71 12.7% - ----------------------------------------------------------------------------------------------------------------------
The 1999 second-quarter net income was $85.8 million or $.48 diluted earnings per share compared with net income of $78.2 million or $.40 diluted earnings per share in the second quarter of 1998, excluding special items. For the first six months, net income was $147.2 million or $.81 diluted earnings per share compared with net income of $140.3 million or $.72 diluted earning per share for the first six months of 1998, excluding special items. Including special items, the 1999 second-quarter net income was $83.5 million or $.47 diluted earnings per share compared with net income of $75.0 million or $.38 diluted earnings per share in the second quarter of 1998. For the first six months net income, including special items, was $144.9 million or $.80 diluted earnings per share compared with the net income of $139.7 million or $.71 diluted earnings per share for the first six months of 1998. Revenues for the second quarter of 1999 were $779.4 million, a 4.0% increase over 1998 second-quarter revenues of $749.2 million. Revenues for the first six months of 1999 were $1,518.4 million, a 3.2% increase from $1,471.8 million for the same period in 1998. The increase was primarily from higher advertising rates. Operating profit in the second quarter increased 9.5% to a record $158.9 million from $145.1 million, excluding special items. On the same basis, operating profit for the first half of the year rose 4.8% to $274.1 million from $261.5 million in the corresponding period of 1998. Operating profit increased to $154.9 million in the second quarter of 1999 from $145.1 million in the second quarter of 1998, including special items. For the first six months of 1999, operating profit rose to $270.1 million from $261.5 million in the corresponding period of 1998. Special items in the second quarter of 1999 included a $4.0 million pre-tax charge ($.01 diluted earnings per share) for work force reduction expenses at The Boston Globe. In the second quarter of 1998, special items included a debt extinguishment charge and a gain on the sale of magazine properties, which together amounted to a $5.7 million pre-tax 9 charge ($.02 diluted earnings per share). In addition, in the first quarter of 1998 there was a pre-tax gain on the sale of equipment, which totaled $4.6 million ($.01 diluted earnings per share). Excluding special items, EBITDA (earnings before interest, taxes, depreciation and amortization) in the second quarter rose to $210.7 million from $196.0 million in the 1998 second quarter. On the same basis, EBITDA for the six months of 1999 was $378.6 million compared with $362.6 million in the same period of 1998. The 1999 second-quarter EBITDA rose to $206.7 million from $196.0 million in the comparable 1998 period, including special items. On the same basis, EBITDA for the first six months of 1999 was $374.6 million compared with $362.6 million in the same period of 1998. 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 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. Consolidated operating expenses for 1999 and 1998 were as follows:
- --------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended ---------------------------------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands) 1999 1998 % Change 1999 1998 % Change - --------------------------------------------------------------------------------------------------- Production costs Raw materials $ 82,463 $ 88,745 -7.1% $ 169,783 $ 176,523 -3.8% Wages and benefits 152,228 148,269 2.7% 294,300 289,502 1.7% Other 102,537 97,472 5.2% 202,941 198,443 2.3% - --------------------------------------------------------------------------------------------------- Total production costs 337,228 334,486 0.8% 667,024 664,468 0.4% Selling, general and administrative expenses 287,296 269,590 6.6% 581,317 545,801 6.5% - --------------------------------------------------------------------------------------------------- Total expenses $624,524 $604,076 3.4% $1,248,341 $1,210,269 3.1% - ---------------------------------------------------------------------------------------------------
Production costs for the second quarter of 1999 were $337.2 million, a 0.8% increase from 1998 second-quarter production costs of $334.5 million. For the first six months of 1999, production costs were $667.0 million, a 0.4% increase from $664.5 million in the comparable period of 1998. Selling, general and administrative expenses ("SGA expenses") in the second quarter of 1999 were $287.3 million, a 6.6% increase over the 1998 second-quarter SGA expenses of $269.6 million. For the first six months of 1999, SGA expenses were $581.3 million, a 6.5% increase, compared to $545.8 million for the same period in 1998. These amounts include the $4.0 million buyout charge for The Boston Globe in the second quarter of 1999. The higher level of SGA expenses is partly attributable to increased national distribution and promotion costs for The New York Times newspaper, as well as higher total salary costs and buyouts. Other Items Interest expense-net increased to $12.8 million in the 1999 second quarter and $24.7 million in the first six months of 1999 compared with $10.5 million and $20.6 million in the comparable 1998 periods, principally due to additional borrowings to fund the Company's share repurchase program. The effective income tax rate for the second quarter of 1999 was 42.6%, compared with 43.5% in the 1998 second quarter. For the first six months of 1999 the effective income tax rate was 42.7% compared with 43.7% in the first six months of 1998. The decreases in the effective income tax rates were primarily due to lower state and local income taxes. 10 Consolidated revenues, EBITDA, depreciation and amortization and operating profit by business segment were as follows:
- -------------------------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended ------------------------------------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands) 1999 1998 % Change 1999 1998 % Change - -------------------------------------------------------------------------------------------------------------------- (13 Weeks) (26 Weeks) REVENUES Newspapers ...................... $ 705,995 $ 671,786 5.1% $ 1,384,245 $ 1,329,116 4.1% Broadcast ....................... 40,805 41,049 -0.6% 73,897 74,347 -0.6% Magazines ....................... 32,585 36,355 -10.4% 60,301 68,290 -11.7% ------------------------------------------------------------------------------- Total ......................... $ 779,385 $ 749,190 4.0% $ 1,518,443 $ 1,471,753 3.2% =============================================================================== EBITDA Newspapers ...................... $ 184,850 $ 172,113 7.4% $ 338,391 $ 321,717 5.2% Broadcast ....................... 19,068 18,020 5.8% 30,423 29,760 2.2% Magazine ........................ 8,462 9,877 -14.3% 13,262 16,064 -17.4% Unallocated Corporate Expenses .. (9,010) (7,969) -13.1% (15,093) (13,381) -12.8% Joint Ventures .................. 3,353 3,995 -16.1% 7,644 8,454 -9.6% ------------------------------------------------------------------------------- Total ......................... $ 206,723 $ 196,036 5.5% $ 374,627 $ 362,614 3.3% =============================================================================== DEPRECIATION AND AMORTIZATION Newspapers ...................... $ 41,036 $ 42,629 -3.7% $ 82,216 $ 84,644 -2.9% Broadcast ....................... 4,362 4,410 -1.1% 8,732 8,866 -1.5% Magazine ........................ 355 (2,126) N/A 686 (4,257) N/A Corporate ....................... 2,756 2,014 36.9% 5,247 3,423 53.3% Joint Ventures .................. 88 88 -- 176 176 -- ------------------------------------------------------------------------------- Total ......................... $ 48,597 $ 47,015 3.4% $ 97,057 $ 92,852 4.5% =============================================================================== OPERATING PROFIT (LOSS) Newspapers ...................... $ 143,814 $ 129,484 11.1% $ 256,175 $ 237,073 8.1% Broadcast ....................... 14,705 13,610 8.1% 21,691 20,894 3.8% Magazines ....................... 8,107 12,003 -32.5% 12,576 20,321 -38.1% Unallocated Corporate Expenses .. (11,765) (9,983) -17.9% (20,340) (16,804) -21.0% ------------------------------------------------------------------------------- Total ......................... $ 154,861 $ 145,114 6.7% $ 270,102 $ 261,484 3.3% ===============================================================================
Newspaper Group: The Newspaper Group consists of The New York Times ("The Times"), The Boston Globe ("The Globe"), 21 regional newspapers, newspaper distributors, a news service, a features syndicate, TimesFax, licensing operations of the New York Times databases and microfilm and Internet-related ventures. - -------------------------------------------------------------------------------- Three Months Ended Six Months Ended ----------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands) 1999 1998 1999 1998 - -------------------------------------------------------------------------------- (13 Weeks) (26 Weeks) Revenues $705,995 $671,786 $1,384,245 $1,329,116 - -------------------------------------------------------------------------------- EBITDA $184,850 $172,113 $ 338,391 $ 321,717 - -------------------------------------------------------------------------------- Operating Profit $143,814 $129,484 $ 256,175 $ 237,073 - -------------------------------------------------------------------------------- Revenues from Internet-related ventures in the Newspaper Group grew 41.4% in the second quarter to $5.9 million versus $4.2 million in the 1998 second quarter. For the first six months of 1999 revenue increased 31.8% to $10.7 million from $8.1 million in the comparable 1998 period. 11 Internet-related revenue and operating loss in the Newspaper Group were as follows:
- ---------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended -------------------------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands) 1999 1998 % Change 1999 1998 % Change - ---------------------------------------------------------------------------------------------- Revenues Advertising $ 5,130 $ 2,893 77.3% $ 9,103 $ 5,645 61.3% Circulation and Other 771 1,281 -39.8% 1,622 2,492 -34.9% -------------------------------------------------------------------- Total $ 5,901 $ 4,174 41.4% $ 10,725 $ 8,137 31.8% ==================================================================== Operating Loss $ (3,211) $(2,722) -18.0% $ (6,614) $(3,941) -67.8% ====================================================================
Internet-related revenue and operating loss includes The New York Times on the Web, New York Today, boston.com and the Regional Newspapers' Web sites. In July 1998, The New York Times on the Web stopped charging users outside the United States for subscription fees. Total Newspaper Group revenues in the second quarter were $706.0 million compared to $671.8 million in the comparable period of 1998. For the first six months of 1999, revenues were $1,384.2 million compared with $1,329.1 million in the first six months of 1998. The increase in 1999 revenues for the second quarter and the first six months was primarily due to higher advertising rates. Performance was strongest at The Times where advertising revenues increased 8.8% for the quarter and 7.1% for the first six months. At the Regional Newspaper Group, advertising revenues were also strong, increasing 6.0% for the quarter and 6.4% for the first six months, due in part to the success of Celebrate 2000, a comprehensive program of millennium-related advertising, circulation and promotion initiatives. The Globe showed favorable variances in advertising revenues, increasing 1.8% in the quarter, after experiencing two consecutive quarters of declines. Circulation revenue was particularly strong at The Times, increasing 2.7% for the quarter and 3.3% year to date, reflecting gains in both daily and Sunday circulation. Second-quarter operating profit for the Newspaper Group increased 14.2% to $147.8 million from $129.5 million in the 1998 second quarter, excluding special items. For the first half of the year, operating profit increased 9.7% to $260.2 million from $237.1 million in the comparable 1998 period, excluding special items. 12 Advertising, circulation and other revenue, by major product of the Newspaper Group, were as follows:
- ---------------------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended --------------------------------------------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands) 1999 1998 % Change 1999 1998 % Change - ---------------------------------------------------------------------------------------------------------------- The New York Times Advertising $292,683 $269,146 8.8% $ 568,236 $ 530,495 7.1% Circulation 113,976 110,982 2.7% 227,594 220,397 3.3% Other 34,031 33,924 0.3% 68,135 68,149 - - ---------------------------------------------------------------------------------------------------------------- Total $440,690 $414,052 6.4% $ 863,965 $ 819,041 5.5% - ---------------------------------------------------------------------------------------------------------------- The Boston Globe Advertising $116,726 $114,616 1.8% $ 225,236 $ 225,911 -0.3% Circulation 33,578 33,661 -0.3% 65,903 66,523 -0.9% Other 2,153 2,093 2.9% 4,322 4,076 6.0% - ---------------------------------------------------------------------------------------------------------------- Total $152,457 $150,370 1.4% $ 295,461 $ 296,510 -0.4% - ---------------------------------------------------------------------------------------------------------------- Regional Newspapers Advertising $ 89,773 $ 84,688 6.0% $ 177,667 $ 167,043 6.4% Circulation 19,112 19,136 -0.1% 39,347 39,545 -0.5% Other 3,963 3,540 12.0% 7,805 6,977 11.9% - ---------------------------------------------------------------------------------------------------------------- Total $112,848 $107,364 5.1% $ 224,819 $ 213,565 5.3% - ---------------------------------------------------------------------------------------------------------------- Total Newspaper Group Advertising $499,182 $468,451 6.6% $ 971,139 $ 923,449 5.2% Circulation 166,666 163,779 1.8% 332,844 326,465 2.0% Other 40,147 39,556 1.5% 80,262 79,202 1.3% - ---------------------------------------------------------------------------------------------------------------- Total $705,995 $671,786 5.1% $1,384,245 $1,329,116 4.2% - ----------------------------------------------------------------------------------------------------------------
Advertising volume on a comparable basis for the quarter was as follows:
- ---------------------------------------------------------------------------------------------------------------- Three Months Ended Six months Ended ------------------------------------------------------------------------------------- (Inches in thousands, preprints in thousands of June 27, June 28, June 27, June 28, copies) 1999 1998 % Change 1999 1998 % Change - ---------------------------------------------------------------------------------------------------------------- The New York Times Retail 137.4 136.0 1.0% 262.6 260.0 1.0% National 379.6 352.0 7.8% 729.8 692.7 5.4% Classified 264.2 263.7 0.2% 519.0 518.4 0.1% Zoned 275.5 270.3 1.9% 499.7 492.8 1.4% - ---------------------------------------------------------------------------------------------------------------- Total 1,056.7 1,022.0 3.4% 2,011.1 1,963.9 2.4% - ---------------------------------------------------------------------------------------------------------------- Preprints 95,521 77,089 23.9% 192,030 151,988 26.3% - ---------------------------------------------------------------------------------------------------------------- The Boston Globe Retail 156.7 170.5 -8.1% 295.3 309.9 -4.7% National 180.9 186.7 -3.1% 354.2 355.1 -0.3% Classified 357.3 350.1 2.1% 694.7 693.0 0.2% Zoned 75.0 79.1 -5.1% 130.7 140.6 -7.0% - ---------------------------------------------------------------------------------------------------------------- Total 769.9 786.4 -2.1% 1,474.9 1,498.6 -1.6% - ---------------------------------------------------------------------------------------------------------------- Preprints 190,836 181,132 5.4% 377,198 351,613 7.3% - ---------------------------------------------------------------------------------------------------------------- Regional Newspapers Retail 1,857.2 1,960.8 -5.3% 3,706.0 3,864.3 -4.1% National 72.4 63.1 14.7% 140.9 132.5 6.4% Legal 189.4 213.7 -11.4% 273.4 296.0 -7.6% Classified 2,037.0 1,922.8 5.9% 3,954.8 3,714.8 6.5% - ---------------------------------------------------------------------------------------------------------------- Total 4,156.0 4,160.4 -0.1% 8,075.1 8,007.6 0.8% - ---------------------------------------------------------------------------------------------------------------- Preprints 269,634 258,854 4.2% 539,856 520,386 3.7% - ----------------------------------------------------------------------------------------------------------------
Average circulation for The Times, The Globe and the Regional Newspapers (excluding non-dailies) for the quarter and six months ended June 27, 1999, compared with the quarter and six months ended June 28, 1998, was as follows: 13 - -------------------------------------------------------------------------------- Three Months Ended June 27, 1999 ------------------------------------------------ (Copies in thousands) Weekday % Change Sunday % Change - -------------------------------------------------------------------------------- Average Net Paid Circulation The New York Times 1,102.6 2.9% 1,671.4 2.4% The Boston Globe 462.1 -1.4% 722.8 -4.0% Regional Newspapers 724.8 -- 765.6 -0.7% - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Six Months Ended June 27, 1999 ------------------------------------------------ (Copies in thousands) Weekday % Change Sunday % Change - -------------------------------------------------------------------------------- Average Net Paid Circulation The New York Times 1,115.6 2.6% 1,689.4 2.7% The Boston Globe 462.2 -0.7% 724.3 -3.4% Regional Newspapers 749.8 -0.2% 795.9 -0.8% - -------------------------------------------------------------------------------- Circulation growth for The Times was primarily due to improved availability in major markets across the nation and 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 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. - -------------------------------------------------------------------------------- Three Months Ended Six Months Ended -------------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands) 1999 1998 1999 1998 - -------------------------------------------------------------------------------- (13 Weeks) (26 Weeks) Revenues $40,805 $41,049 $73,897 $74,347 - -------------------------------------------------------------------------------- EBITDA $19,068 $18,020 $30,423 $29,760 - -------------------------------------------------------------------------------- Operating Profit $14,705 $13,610 $21,691 $20,894 - -------------------------------------------------------------------------------- Operating profit increased 8.1% in the second quarter to $14.7 million from $13.6 million while revenues remained flat. For the first half of 1999, revenues and operating profit totaled $73.9 million and $21.7 million compared with $74.3 million and $20.9 million in the same period of 1998, when four of the Company's eight television stations benefited from broadcasting the Winter Olympics. Second-quarter and first-half operating profit and revenues were adversely affected by tornado storm coverage at the Company's Oklahoma City station. 14 Magazine Group: The Magazine Group is comprised of three golf publications and related activities in the golf field. - -------------------------------------------------------------------------------- Three Months Ended Six Months Ended ----------------------------------------------------- June 27, June 28, June 27, June 28, (Dollars in thousands) 1999 1998 1999 1998 - -------------------------------------------------------------------------------- (13 Weeks) (26 Weeks) Revenues Magazines $32,585 $33,855 $60,301 $63,290 Non-Compete Agreement -- 2,500 -- 5,000 - -------------------------------------------------------------------------------- Total Revenues $32,585 $36,355 $60,301 $68,290 - -------------------------------------------------------------------------------- EBITDA $ 8,462 $ 9,877 $13,262 $16,064 - -------------------------------------------------------------------------------- Operating Profit Magazines $ 8,107 $ 9,503 $12,576 $15,321 Non-Compete Agreement -- 2,500 -- 5,000 - -------------------------------------------------------------------------------- Total Operating Profit $ 8,107 $12,003 $12,576 $20,321 - -------------------------------------------------------------------------------- The Magazine Group's second-quarter revenues and operating profit were $32.6 million and $8.1 million compared with $33.9 million and $9.5 million in the 1998 second quarter. For the first half of 1999, revenues and operating profit were $60.3 million and $12.6 million compared with $63.3 million and $15.3 million in the first half of 1998. Excluded from these results is revenue from the amortization of a non-compete agreement that ended last July, which increased 1998 second-quarter and first-half operating profit by $2.5 million and $5.0 million. Consolidation in the golf equipment industry and a competitive rate environment adversely affected the Group's revenues. Liquidity and Capital Resources Net cash provided by operating activities was $228.3 million for the first six months of 1999, compared with $215.0 million for the first six months of 1998. The increase of $13.3 million in 1999 was primarily due to improved earnings. Net cash used in investing activities was $28.1 million in the first six months of 1999, compared with $21.8 million in the 1998 comparable period. The increase of $6.3 million in 1999 was primarily due to additional contributions to minority interest investments in Internet-related companies. This increase was partially offset by reduced levels of capital expenditures. Net cash used in financing activities was $204.3 million in the first six months of 1999, compared with $257.7 million in the 1998 comparable period. The decrease of $53.4 million in 1999 was primarily related to an increase in commercial paper borrowings to fund increased levels of stock repurchases, and partially offset by the debt extinguishment in 1998. The Company believes that cash generated from its operations and the availability of funds from external sources should be adequate to cover working capital needs, stock repurchases, planned capital expenditures, dividend payments to stockholders and other cash requirements. The ratio of current assets to current liabilities was 75% at June 27, 1999, and 87% at June 28, 1998. This decrease is principally due to an increase in commercial paper outstanding at June 27, 1999, mostly resulting from the funding of stock repurchases. The ratio of long-term debt and capital lease obligations as a percentage of total capitalization was 30% at June 27, 1999, compared with 21% at June 28, 1998. This increase was principally due to stock repurchases. 15 Financing: The Company's total debt, including commercial paper and capital leases, was $805.9 million at June 27, 1999, and $562.0 million at June 28, 1998. The increase in total debt was primarily from an increase in commercial paper. Effective July 1999, the Company increased the funds available under its revolving credit agreements from $300 million to $400 million, which require, among other provisions, specified levels of stockholders' equity. A revolving credit agreement for $200 million expires in June 2000, and an additional revolving credit agreement for $200 million expires in July 2002. The Company had $206.6 million in commercial paper outstanding at June 27, 1999, which obligations are supported by these revolving credit agreements. No commercial paper was outstanding at June 28, 1998. Approximately $564.0 million of stockholders' equity was unrestricted under these agreements at June 27, 1999, and $898.6 million was unrestricted at June 28, 1998. This decrease was principally due to stock repurchases. Capital Expenditures: The Company currently estimates that capital expenditures for 1999 will range from $90.0 million to $100.0 million. The Company currently anticipates that depreciation and amortization expense will approximate $195.0 million for 1999 compared with $188.2 million in 1998. Year 2000 Readiness Disclosure: The Company has evaluated the potential impact of the situation commonly known as the "Year 2000 problem." The Year 2000 problem, which is common to most corporations, concerns the ability of information systems, primarily computer software programs, to properly recognize and process date-sensitive information related to the Year 2000. In April 1997 the Company began to identify all of its Year 2000 concerns for all facets of its operations. A Year 2000 Program Office was established, and a detailed inventory of all systems issues required to be addressed in connection with the Year 2000 was created. Information was gathered for each system including: o type of system and its relative importance o probable method and cost of remediation and o targeted start and end dates for addressing Year 2000 issues. This inventory includes systems to: o create the Company's publications o operate the Company's production and distribution facilities o operate the Company's broadcast stations o operate the Company's business and financial applications and o control facility and infrastructure areas (building systems, utilities, security systems, etc.). The systems identified in the inventory were further categorized into five priority classifications: o Shutdown - highest priority. If these systems (e.g., editorial systems, presses, and utilities) were to fail, the Company's ability to continue its operations would be seriously impaired. Approximately 8% of the identified systems are in this category. o Impractical Workaround - If these systems were to fail, the available alternatives are too expensive to implement. Approximately 9%. 16 o Costly Workaround - If these systems were to fail, a feasible but costly alternative exists. Approximately 28%. o Additional But Manageable Cost - If these systems fail, an alternative solution exists at a moderate cost. Approximately 22%. o No Impact - Little if any consequence to the business if these systems fail. Approximately 33%. By October 1997 the Company had completed the inventory phase and turned its attention to the remediation phase. Target dates for each item in the inventory were identified and are continually monitored to ensure timely resolution of the issues. The remediation strategy involves a mix of purchasing new systems, modifying existing systems, retiring obsolete systems and confirming vendor compliance. As of June 27, 1999, 97% of all systems had been remediated and tested. Testing systems for Year 2000 compliance includes the use of dates that simulate transactions and environments, both prior and subsequent to the Year 2000, including specific testing for leap year. The Company has communicated with most of its suppliers and other vendors, and is contacting its significant advertisers, seeking assurances that they will be Year 2000 compliant. Although there is no certainty that any major business partner will function without disruption in the Year 2000, the Company's goal is to obtain detailed information about its advertisers' and suppliers' Year 2000 plans and to identify those companies that could pose a significant risk of failure. The Company will make alternate arrangements where necessary. Generally, the Company is not dependent on a single source for any products or services, except for products or services supplied by public utilities. In the event a significant supplier or other vendor is unable to provide products or services to the Company due to a Year 2000 failure, the Company believes it has adequate alternate sources for such products or services. There is no guarantee, however, that such alternate products or services would be available at the same terms and conditions or that the Company would not experience some adverse effects as a result of switching to alternate sources. To date, the Company has identified total estimated costs in connection with the Year 2000 problem of between $15 million and $20 million. This estimate does not include systems previously scheduled for replacement without regard to the Year 2000 issue. Of this amount, approximately $10 million will be for systems replacements involving capital outlays (which are not deducted as an expense on the Company's Consolidated Statements of Income). The remaining amount is being deducted as an expense on the Company's Consolidated Statements of Income through 1999. Approximately 75% of this expense total is attributable to the use of currently available internal resources. The cost of the Company's Year 2000 remediation efforts is being funded with cash flows from operations. With respect to its internal operations, those over which the Company has direct control, the Company believes that all of its critical systems (i.e., those categorized in the shutdown or impractical workaround categories described above) will be remediated and tested by the end of the third quarter of 1999. Like most large business enterprises, the Company is reliant upon certain critical vendors. Certain of these vendors have yet to provide a Year 2000 compliant product, while services that are provided by certain other vendors cannot be tested (i.e., power and telecommunications). The Company believes the possibility of critical vendor failures to be remote based on the information supplied to date by such critical vendors. 17 The Company's Year 2000 strategies include contingency planning, encompassing business continuity both within the Company and in the external business environment. The planning effort encompasses all critical Company areas. The Company's contingency planning for the Year 2000 will address a variety of scenarios that could occur. Because of the Company's extensive efforts to formulate and carry out an effective Year 2000 remediation program, the Company believes that such remediation will be completed on a timely basis and should effectively minimize any disruption to the Company's operations due to Year 2000 issues. The Company does not expect Year 2000 issues to have a material effect on its results of operations, liquidity or financial condition. 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 or 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 27, 1998. 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. 18 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 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. 19 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: August 11, 1999 /S/ John M. O'Brien ----------------------------- John M. O'Brien Senior Vice President and Chief Financial Officer (Principal Financial Officer) 20 Exhibit Index to Quarterly Report Form 10-Q Quarter Ended June 27, 1999 Exhibit No. Exhibit - ----------- ------- 12 Ratio of Earnings to Fixed Charges 27 Financial Data Schedule 21 EX-12 2 RATIO OF EARNINGS TO FIXED CHARGES THE NEW YORK TIMES COMPANY Ratio of Earnings to Fixed Charges (Dollars in thousands, except ratio) (Unaudited) Exhibit 12
Three Months Ended Six Months Ended June 27, June 28, June 27, June 28, 1999 1998 1999 1998 ------------------------------------------------- Earnings from continuing operations before fixed charges Income before income taxes and income from joint ventures $142,020 $ 142,630 $245,365 $ 253,476 Less net gain on dispositions of assets -- (8,000) (12,619) Distributed earnings from less than fifty percent owned affiliates 2,000 4,286 3,475 7,126 ------------------------------------------------- Adjusted pre-tax earnings from continuing operations 144,020 138,916 248,840 247,983 Fixed charges less capitalized interest 16,028 13,677 30,932 27,654 ------------------------------------------------- Earnings from continuing operations before fixed charges $160,048 $ 152,593 $279,772 $ 275,637 ================================================= Fixed charges Interest expense, net of capitalized interest $ 13,387 $ 11,327 $ 25,723 $ 22,953 Capitalized interest 173 Portion of rentals representative of interest factor 2,641 2,350 5,209 4,701 ------------------------------------------------- Total fixed charges $ 16,028 $ 13,677 $ 30,932 $ 27,827 ================================================= Ratio of earnings to fixed charges 9.99 11.16 9.04 9.91 =================================================
EX-27 3 FINANCIAL DATA SCHDULE
5 This schedule contains summary financial information extracted from the Consolidated Condensed Financial Statements as of and for the quarter ended June 27, 1999 and is qualified in its entirety by reference to such financial statements. 1,000 6-MOS DEC-26-1999 DEC-28-1998 JUN-27-1999 31,912 0 383,235 40,702 27,999 520,415 2,245,046 961,952 3,457,569 696,238 0 0 0 18,863 1,385,920 3,457,569 0 1,518,443 0 667,024 0 0 24,737 252,833 107,960 144,873 0 0 0 144,873 .81 .80
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