-----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, UOltbteQwWvV/73UGzLtzmRPjNmLZDd9WpDv78xnqVkN2+eqXRV66eRSbKwvgz5I uup6FF6G9jYX0aAZHeZiVA== 0001157523-06-010060.txt : 20061019 0001157523-06-010060.hdr.sgml : 20061019 20061019090322 ACCESSION NUMBER: 0001157523-06-010060 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20061019 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Cost Associated with Exit or Disposal Activities ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20061019 DATE AS OF CHANGE: 20061019 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: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05837 FILM NUMBER: 061152108 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 8-K 1 a5253242.txt THE NEW YORK TIMES COMPANY 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): October 19, 2006 ---------------- The New York Times Company - -------------------------------------------------------------------------------- (Exact name of Registrant as Specified in Its Charter) New York 1-5837 13-1102020 - -------------------------------------------------------------------------------- (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 229 West 43rd Street, New York, New York 10036 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (212) 556-1234 -------------- Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 2.02 Results of Operations and Financial Condition. On October 19, 2006, The New York Times Company (the "Company") issued a press release announcing the Company's earnings for the quarter ended September 24, 2006. On October 19, 2006, the Company also issued a press release announcing the Company's revenues for September 2006. Copies of these press releases are furnished as exhibits to this Form 8-K. ITEM 2.05 Costs Associated with Exit or Disposal Activities. This Current Report on Form 8-K updates the Company's Form 8-K filing on July 18, 2006, in which the Company disclosed plans to consolidate its New York metro area printing into its newest facility in College Point, Queens, and sublease its older Edison, New Jersey, facility. At that time, the Company was unable to provide the estimated cost to close the Edison facility. The Company currently estimates that it will record total costs in the range of $104 to $128 million. The breakdown of estimated expenses is as follows: o $78 to $90 million ($13 to $15 million per quarter) for accelerated depreciation expense, which will begin in the fourth quarter of 2006 and end in the first quarter of 2008. This expense is for the acceleration of depreciation expense of certain assets, mainly presses, at its Edison facility. o $12 to $16 million for one-time staff reduction cash expenditures. The exact cost and the timing of the recognition and expenditures will depend on the final composition and seniority of the affected employees as well as the timing of the implementation of the staff reductions. o $14 to $22 million for cash expenditures to restore the Edison facility to its pre-lease condition, approximately half of which was previously expensed. ITEM 9.01 Financial Statements and Exhibits. (d) Exhibits Exhibit 99.1 The New York Times Company Earnings Press Release dated October 19, 2006 Exhibit 99.2 The New York Times Company September Revenues Press Release dated October 19, 2006 Forward-Looking Statements Except for the historical information contained herein, the matters discussed in this current report on Form 8-K 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 our various markets and material increases in newsprint 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 year ended December 25, 2005. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. 2 SIGNATURE 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 hereunto duly authorized. THE NEW YORK TIMES COMPANY Date: October 19, 2006 By: /s/ Rhonda L. Brauer -------------------------------- Rhonda L. Brauer Secretary and Corporate Governance Officer 3 Exhibit List Exhibit 99.1 The New York Times Company Earnings Press Release dated October 19, 2006 Exhibit 99.2 The New York Times Company September Revenues Press Release dated October 19, 2006 4 EX-99.1 2 a5253242ex99-1.txt EXHIBIT 99.1 Exhibit 99.1 The New York Times Company Reports 2006 Third-Quarter Results NEW YORK--(BUSINESS WIRE)--Oct. 19, 2006--The New York Times Company announced today that 2006 third-quarter diluted earnings per share (EPS) were $.10, compared with $.16 in the third quarter last year. Third-quarter net income was $14.0 million compared with $23.1 million in the same period of 2005. Included in results are: -- staff reduction costs of $7.4 million ($4.3 million after tax, or $.03 per share) in the 2006 third quarter and $12.4 million ($7.5 million after tax, or $.05 per share) in the third quarter last year and -- a loss of $7.8 million ($4.3 million after tax, or $.03 per share) from the sale of the Company's 50 percent investment in the Discovery Times Channel (DTC), a digital cable channel. The Company only presents EPS on a generally accepted accounting principles (GAAP) basis. This differs from the pro forma EPS provided by databases such as First Call and Reuters. "Our third-quarter results reflect the continued weakness in the print advertising marketplace," said Janet L. Robinson, president and chief executive officer. "We are, however, strongly encouraged by the discipline our teams have shown in holding the line on operating costs, which were virtually flat with the third quarter of last year. The leadership we are showing in transitioning from our print-centric distribution model to become a multi-platform content provider continues to pay dividends through the robust growth in our Internet-related revenues, which contributed more than 8 percent of the Company's revenues in the quarter and are on track to exceed $250 million by year end. "The strength of our brands both in print and online continues to provide the foundation for translating excellence in content and execution into innovative products that attract readers and add value for our advertisers. "The contemplated sale of our Broadcast Media Group and the sale of our interest in the Discovery Times Channel, coupled with strategic acquisitions such as Baseline StudioSystems and Calorie-Count.com that increase our footprint in the Internet space, all serve to sharpen our focus going forward." On September 12, 2006, the Company announced that it plans to sell its Broadcast Media Group. Under GAAP, the results of operations of the Broadcast Media Group are now classified under discontinued operations for all periods presented. Third-Quarter Financial Results from Continuing Operations All comparisons are for the third quarter of 2006 to the third quarter of 2005 and exclude the results of the Broadcast Media Group. Revenues Total revenues decreased 2.4 percent to $739.6 million from $757.8 million. Advertising revenues declined 4.2 percent; circulation revenues were down 1.3 percent; and other revenues increased 8.9 percent. Costs and Expenses Total costs and expenses increased 0.1 percent to $719.1 million from $718.4 million. Excluding those related to staff reductions, total costs and expenses rose 0.8 percent. The increase includes: -- 0.4 percent attributable to increased compensation expense and -- 0.3 percent attributable to higher distribution expense. Newsprint expense decreased 2.2 percent in the third quarter, with 11.1 percent of the decrease resulting from lower consumption partially offset by an 8.9 percent increase from higher prices. Total costs and expenses excluding staff reductions, raw materials and depreciation and amortization increased 0.7 percent. Reconciliations to total costs and expenses excluding these items (non-GAAP financial measures) are included in the exhibits to this release. Operating Profit Operating profit decreased to $20.5 million from $39.4 million due to a decline in revenues, as discussed above. Business Segment Results News Media Group Total News Media Group revenues decreased 3.0 percent to $721.3 million from $743.6 million. Advertising revenues decreased 5.1 percent due to weakness in print advertising at The New York Times Media Group and the New England Media Group, partially offset by higher online advertising revenues across the News Media Group. Circulation revenues were down 1.3 percent mainly due to weakness at the New England Media Group. On October 1 The New York Times raised the newsstand price of the Northeast edition of the Sunday Times from $4.50 to $5.00, which is the same price as the national edition. Home-delivery prices are scheduled to increase 4 percent on November 6. These two price increases are expected to add approximately $12 million to circulation revenues in 2007. Other revenues increased 8.3 percent largely because of the introduction of TimesSelect, higher commercial printing revenues and the revenues from Baseline StudioSystems, which was acquired on August 28, 2006. Baseline is a leading online database and research service for information on the film and television industries. Total News Media Group costs and expenses decreased slightly primarily due to lower staff reduction costs, offset in part by the increase in expenses discussed above. Operating profit for the News Media Group decreased to $25.5 million from $45.3 million, due to lower revenues. About.com About.com's third-quarter revenues increased 29.3 percent to $18.3 million from $14.2 million due to higher display and cost-per-click advertising and e-commerce revenue. Operating profit increased to $6.4 million from $3.8 million. Other Financial Data Internet Revenues In the third quarter, the Company's Internet-related businesses generated $62.8 million in revenue, up from $50.5 million in the third quarter of 2005. For the first nine months of 2006, these Internet-related businesses generated $189.7 million in revenue, up from $134.2 million in the same period last year. Internet-related businesses include our digital archives, NYTimes.com, Boston.com, About.com and Web sites of our other newspaper properties. In total, Internet businesses accounted for about 8.5 percent of the Company's revenues in the third quarter versus 6.7 percent in the same quarter a year ago. Joint Ventures In September 2006, the Company completed the sale of its 50 percent investment in DTC for $100 million. The sale resulted in a loss of $7.8 million. Including the loss from the sale, net income from joint ventures increased in the third quarter to $7.3 million from $5.0 million primarily due to stronger performance at New England Sports Ventures. Interest Expense-net Interest expense-net increased to $13.3 million from $11.7 million mainly because of higher levels of debt outstanding and higher short-term interest rates. Income Taxes The effective income tax rate decreased to 35.0 percent from 42.4 percent as the Company benefited from a favorable adjustment in the third quarter resulting from the completion of the Company's 2005 federal taxes. Discontinued Operations Income from the Broadcast Media Group is presented on the attached Condensed Consolidated Statements of Income as "Discontinued operations, net of income taxes - Broadcast Media Group" and was $4.3 million, or $.03 per share, for the third quarter, and $3.4 million, or $.02 per share, for the third quarter of 2005. Results for the Broadcast Media Group for the third quarter and first nine months of 2006 and 2005 are included in the exhibits to this release. Shares In the third quarter, the Company repurchased 0.7 million Class A shares at a cost of $15.6 million. Approximately $108.2 million remained at the end of the third quarter from the Company's current share repurchase authorization. Class A and Class B common shares outstanding at the end of the quarter totaled 144.1 million shares. Cash and Total Debt At the end of the quarter, the Company's cash and cash equivalents were approximately $39 million and total debt was approximately $1.5 billion. Capital Expenditures In August 2006, the Company's new headquarters building was converted to a leasehold condominium, with the Company and its development partner acquiring ownership of their respective leasehold condominium units. Previously, the leasehold interest in the building was held by a consolidated partnership in which the Company held a 58 percent interest and its development partner held a 42 percent interest. As of August 2006, the consolidated partnership no longer holds the development partner's condominium interests, and, as a result, its condominium units and capital expenditures are not consolidated in the Company's financial statements. The Company's capital expenditures include those of its development partner through August 2006. In the third quarter, total capital expenditures were approximately $90 million. Of this amount, the development partner's responsibility was approximately $11 million. The balance of $79 million was the Company's responsibility, including approximately $56 million for its portion of the cost of its new headquarters. Plant Consolidation In the third quarter, the Company announced plans to consolidate its New York metro area printing into its newest facility in College Point, Queens, and sublease its older Edison, New Jersey, facility. The consolidation is expected to be completed in the second quarter of 2008. On an ongoing basis, the Company expects to save $30 million in lower operating costs and avoid the need for approximately $50 million in capital investment at the Edison facility over the next ten years. The Company expects a return on its $135 million investment related to the plant consolidation of at least 15 percent with a payback period of five and a half years. The Company currently estimates that it will record total costs to close the Edison facility in the range of $104 to $128 million. The breakdown of estimated expenses is as follows: -- $78 to $90 million ($13 to $15 million per quarter) for accelerated depreciation expense, which will begin in the fourth quarter of 2006 and end in the first quarter of 2008. This expense is for the acceleration of depreciation expense of certain assets, mainly presses, at its Edison facility. -- $12 to $16 million for one-time staff reduction cash expenditures. The exact cost and the timing of the recognition and expenditures will depend on the final composition and seniority of the affected employees as well as the timing of the implementation of the staff reductions. -- $14 to $22 million for cash expenditures to restore the Edison facility to its pre-lease condition, approximately half of which was previously expensed. Updated 2006 Expectations Below are the Company's expectations for 2006. -- The Company's revenues will include a full year of revenue from About.com, which is expected to have revenue growth above the industry average of 30 percent as well as double-digit operating profit growth. -- Process engineering benefits - $55 to $60 million. -- Newsprint cost per ton - Growth rate expected to be 9 to 10 percent. -- Depreciation and amortization - $160 to $167 million (includes $13 to $15 million of accelerated depreciation expense in the fourth quarter associated with the consolidation of the New York metro area printing plants and $8 million of depreciation and amortization expense associated with the first nine months of operations of the Broadcast Media Group, which is now considered a discontinued operation, and no longer records this expense). -- Net income from joint ventures - $18 to $20 million, including the $7.8 million loss from the sale of the Company's interest in DTC. -- Interest expense - $51 to $55 million. -- Tax rate - 38.5 percent. -- Capital expenditures - Company* $348 to $368 million Development partner (through August 2006) $55 million -------------------------- Total $403 to $423 million *Includes $216 to $236 million for new headquarters Conference Call Information The Company's third-quarter earnings conference call will be held on Thursday, October 19, at 11 a.m. E.T. To access the call, dial 877-704-5384 (in the U.S.) and 913-312-1297 (international callers). Participants should dial into the conference approximately 10 minutes before the start time. Online listeners can link to the live webcast at www.nytco.com/investors.html. A digital replay will be available at 888-203-1112 (in the U.S.) and 719-457-0820 (international callers) beginning approximately two hours after the call until 5 p.m. E.T. on Friday, October 20. The access code is 2254476. An archive of webcast will be available beginning two hours after the call for 30 days at www.nytco.com/investors.html. In addition, an MP3 file of the call can be downloaded from the Company's site. Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those predicted by such forward-looking statements. These risks and uncertainties include national and local conditions, as well as competition, that could influence the levels (rate and volume) of retail, national and classified advertising and circulation generated by our various markets and material increases in newsprint 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 year ended December 25, 2005. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. The New York Times Company (NYSE: NYT), a leading media company with 2005 revenues of $3.4 billion, includes The New York Times, the International Herald Tribune, The Boston Globe, 15 other daily newspapers, nine network-affiliated television stations, two New York City radio stations and 35 Web sites, including NYTimes.com, Boston.com and About.com. The Company's core purpose is to enhance society by creating, collecting and distributing high-quality news, information and entertainment. This press release can be downloaded from www.nytco.com Exhibits: Condensed Consolidated Statements of Income Segment Information News Media Group Revenues by Operating Segment Footnotes - Reconciliation to Costs and Expenses Excluding Certain Items THE NEW YORK TIMES COMPANY CONDENSED CONSOLIDATED STATEMENTS OF INCOME Statements of Income are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). (Dollars and shares in thousands, except per share data) Third Quarter -------------------------------------- 2006 2005 % Change ------------ ------------ ------------ Revenues Advertising $ 465,476 $ 485,644 -4.2% Circulation 215,007 217,872 -1.3% Other (a) 59,103 54,287 8.9% ------------ ------------ Total 739,586 757,803 -2.4% Costs and expenses (b) 719,110 718,416 0.1% ------------ ------------ Operating profit 20,476 39,387 -48.0% Net income from joint ventures 7,348 5,000 47.0% Interest expense - net 13,267 11,677 13.6% Other income - 1,250 -100.0% ------------ ------------ Income from continuing operations before income taxes and minority interest 14,557 33,960 -57.1% Income taxes 5,091 14,404 -64.7% Minority interest in net loss/(income) of subsidiaries 267 167 59.9% ------------ ------------ Income from continuing operations 9,733 19,723 -50.7% Discontinued operations, net of income taxes - Broadcast Media Group (d) 4,290 3,358 27.8% ------------ ------------ Net Income $ 14,023 $ 23,081 -39.2% ============ ============ Average Number of Common Shares: Basic 144,454 145,214 -0.5% Diluted 144,568 145,602 -0.7% Basic Earnings Per Share: Income from continuing operations $ 0.07 $ 0.14 -50.0% Discontinued operations, net of income taxes 0.03 0.02 50.0% ------------ ------------ Net Income $ 0.10 $ 0.16 -37.5% ============ ============ Diluted Earnings Per Share: Income from continuing operations $ 0.07 $ 0.14 -50.0% Discontinued operations, net of income taxes 0.03 0.02 50.0% ------------ ------------ Net Income $ 0.10 $ 0.16 -37.5% ============ ============ Dividends Per Share $ 0.175 $ 0.165 6.1% ============ ============ Nine Months -------------------------------------- 2006 2005 % Change ------------ ------------ ------------ Revenues Advertising $ 1,528,225 $ 1,524,829 0.2% Circulation 654,993 655,971 -0.1% Other (a) 175,822 159,154 10.5% ------------ ------------ Total 2,359,040 2,339,954 0.8% Costs and expenses (b) 2,184,097 2,122,115 2.9% Gain on sale of assets (c) - 122,946 -100.0% ------------ ------------ Operating profit 174,943 340,785 -48.7% Net income from joint ventures 18,085 7,890 * Interest expense - net 39,025 37,769 3.3% Other income - 3,750 -100.0% ------------ ------------ Income from continuing operations before income taxes and minority interest 154,003 314,656 -51.1% Income taxes 56,206 130,753 -57.0% Minority interest in net loss/(income) of subsidiaries 604 (113) * ------------ ------------ Income from continuing operations 98,401 183,790 -46.5% Discontinued operations, net of income taxes - Broadcast Media Group (d) 11,890 11,155 6.6% ------------ ------------ Net Income $ 110,291 $ 194,945 -43.4% ============ ============ Average Number of Common Shares: Basic 144,803 145,535 -0.5% Diluted 144,982 146,077 -0.7% Basic Earnings Per Share: Income from continuing operations $ 0.68 $ 1.26 -46.0% Discontinued operations, net of income taxes 0.08 0.08 0.0% ------------ ------------ Net Income $ 0.76 $ 1.34 -43.3% ============ ============ Diluted Earnings Per Share: Income from continuing operations $ 0.68 $ 1.26 -46.0% Discontinued operations, net of income taxes 0.08 0.07 14.3% ------------ ------------ Net Income $ 0.76 $ 1.33 -42.9% ============ ============ Dividends Per Share $ 0.515 $ 0.485 6.2% ============ ============ * Represents an increase or decrease in excess of 100%. See footnotes page for additional information. THE NEW YORK TIMES COMPANY SEGMENT INFORMATION Revenues, Operating Profit (Loss) and Depreciation & Amortization are prepared in accordance with GAAP. (Dollars in thousands) Third Quarter ----------------------------------- 2006 2005 % Change ------------ ------------ --------- Revenues (d) - --------------------------------- News Media Group $ 721,260 $ 743,631 -3.0% About.com (e) 18,326 14,172 29.3% ------------ ------------ Total $ 739,586 $ 757,803 -2.4% ============ ============ Operating Profit (Loss) (d) - --------------------------------- News Media Group $ 25,541 $ 45,269 -43.6% About.com (e) 6,418 3,847 66.8% Corporate (11,483) (9,729) 18.0% ------------ ------------ Total $ 20,476 $ 39,387 -48.0% ============ ============ Depreciation & Amortization (d) - --------------------------------- News Media Group $ 32,213 $ 29,658 8.6% About.com (e) 2,959 3,040 -2.7% Corporate 1,504 1,823 -17.5% ------------ ------------ Total $ 36,676 $ 34,521 6.2% ============ ============ Nine Months ----------------------------------- 2006 2005 % Change ------------ ------------ --------- Revenues (d) - --------------------------------- News Media Group $ 2,302,441 $ 2,312,731 -0.4% About.com (e) 56,599 27,223 * ------------ ------------ Total $ 2,359,040 $ 2,339,954 0.8% ============ ============ Operating Profit (Loss) (d) - --------------------------------- News Media Group $ 186,996 $ 243,814 -23.3% About.com (e) 21,291 6,503 * Corporate (33,344) (32,478) 2.7% Gain on Sale of Assets (c) - 122,946 -100.0% ------------ ------------ Total $ 174,943 $ 340,785 -48.7% ============ ============ Depreciation & Amortization (d) - --------------------------------- News Media Group $ 94,260 $ 88,682 6.3% About.com (e) 8,864 6,167 43.7% Corporate 4,588 5,279 -13.1% ------------ ------------ Total $ 107,712 $ 100,128 7.6% ============ ============ * Represents an increase in excess of 100%. See footnotes page for additional information. THE NEW YORK TIMES COMPANY NEWS MEDIA GROUP REVENUES BY OPERATING SEGMENT Revenues are prepared in accordance with GAAP. (Dollars in thousands) 2006 ------------------------- % Third Change vs. Quarter 2005 ------------ ------------ The New York Times Media Group Advertising $ 261,653 -4.1% Circulation 153,739 -0.3% Other 41,516 6.4% ------------ Total $ 456,908 -1.9% ------------ New England Media Group Advertising $ 97,424 -12.4% Circulation 40,483 -5.7% Other 11,146 18.4% ------------ Total $ 149,053 -8.9% ------------ Regional Media Group Advertising $ 88,938 1.0% Circulation 20,785 0.1% Other 5,576 4.3% ------------ Total $ 115,299 1.0% ------------ Total News Media Group Advertising $ 448,015 -5.1% Circulation 215,007 -1.3% Other (a) 58,238 8.3% ------------ Total $ 721,260 -3.0% ============ 2006 ------------------------- % Change vs. Nine Months 2005 ------------ ------------ The New York Times Media Group Advertising $ 885,509 0.0% Circulation 467,858 1.4% Other 123,337 7.5% ------------ Total $ 1,476,704 1.0% ------------ New England Media Group Advertising $ 307,569 -10.0% Circulation 121,055 -6.2% Other 32,173 17.2% ------------ Total $ 460,797 -7.5% ------------ Regional Media Group Advertising $ 281,330 3.9% Circulation 66,080 0.7% Other 17,530 9.1% ------------ Total $ 364,940 3.5% ------------ Total News Media Group Advertising $ 1,474,408 -1.6% Circulation 654,993 -0.1% Other (a) 173,040 9.4% ------------ Total $ 2,302,441 -0.4% ============ See footnotes page for additional information. THE NEW YORK TIMES COMPANY FOOTNOTES (a) Other revenue consists primarily of revenue from wholesale delivery operations, news services, direct marketing, digital archives, commercial printing and TimesSelect. (b) The Company recognized charges of $7.4 million for costs associated with staff reductions in the third quarter of 2006 and $25.9 million for the full nine months of 2006 compared with charges of $12.4 million for the third quarter and $22.3 million for the first nine months of 2005. (c) In the first quarter of 2005, the Company recognized a $122.9 million pre-tax gain from the sale of assets. The Company's sale of its current headquarters building resulted in a total pre-tax gain of $143.9 million, of which $114.5 million was recognized in the first quarter of 2005. The remainder of the gain is being deferred and amortized under GAAP and is offsetting the leaseback expense in connection with the sale. Additionally, in the first quarter of 2005, the Company sold property in Sarasota, Fla., which resulted in a pre-tax gain of $8.4 million. (d) In the third quarter of 2006, the Company announced its plan to sell its Broadcast Media Group, which includes nine network-affiliated television stations and their related properties. Under Statement of Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, the Broadcast Media Group is treated as a discontinued operation. The Company has made reclassifications in all periods presented to reflect this change. Results for the Broadcast Media Group, included within discontinued operations, for the third quarter and nine months of 2006 and 2005 are as follows: (In thousands) Third Quarter Nine Months --------------------- --------------------- 2006 2005 2006 2005 ---------- ---------- ---------- ---------- Revenues $ 36,476 $ 33,280 $ 107,542 $ 101,781 Pre-tax income $ 7,271 $ 5,692 $ 20,153 $ 18,908 Income taxes $ 2,981 $ 2,334 $ 8,263 $ 7,753 Net income $ 4,290 $ 3,358 $ 11,890 $ 11,155 (e) On March 18, 2005, the Company purchased About, Inc., a leading online consumer information provider. Fiscal year 2006 includes results for About.com for the full nine months compared to results from the acquisition date through the third quarter in 2005. Reconciliation to Costs and Expenses Excluding Certain Items Total costs and expenses include expenses related to staff reductions. The Company believes that excluding this item (a non- GAAP financial measure) provides investors with helpful supplemental information on the Company's underlying operating expenses that is used by management in its financial and operational decision-making. Total costs and expenses also include depreciation and amortization and raw material costs. The Company believes that excluding these items (a non-GAAP financial measure) provides a useful measure of manageable costs. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. A reconciliation to costs and expenses excluding these items is below: (In thousands) Third Quarter ---------------------------------- 2006 2005 % Change ----------- ---------- ----------- Costs and Expenses $ 719,110 $ 718,416 0.1% Less: Staff reduction expenses 7,440 12,371 ----------- ---------- ----------- Sub-total 711,670 706,045 0.8% Less: Depreciation & amortization 36,676 34,521 ----------- ---------- ----------- Sub-total 674,994 671,524 0.5% Less: Raw materials 75,178 75,718 ----------- ---------- ----------- Total $ 599,816 $ 595,806 0.7% =========== ========== =========== CONTACT: The New York Times Company Catherine J. Mathis, 212-556-1981 mathis@nytimes.com or Paula Schwartz, 212-556-5224 schwap@nytimes.com EX-99.2 3 a5253242ex99-2.txt EXHIBIT 99.2 Exhibit 99.2 The New York Times Company Reports September Revenues NEW YORK--(BUSINESS WIRE)--Oct. 19, 2006--The New York Times Company announced today that in September 2006 advertising revenues for the Company's business units from continuing operations decreased 3.9% and total Company revenues decreased 2.4% compared with September 2005. "Print advertising remains challenging, especially in categories such as studio entertainment, help wanted and automotive where we are experiencing declines," said Janet L. Robinson, president and CEO. "The slowdown in the advertising market that began in the third quarter is expected to continue through the end of the year. While real estate advertising is cycling difficult comparisons with the fourth quarter last year when it rose 11% at the News Media Group, it remains strong at The Times and our Regional Media Groups, and our digital properties continue to deliver very solid gains, particularly About.com." All comparisons are for September 2006 to September 2005 unless otherwise noted: The New York Times Media Group - Advertising revenues for The New York Times Media Group decreased 3.5%. National advertising revenues decreased as softness in studio entertainment, banking and corporate advertising offset growth in the American fashion, financial services and live entertainment categories. Retail advertising revenues decreased as weakness in mass market advertising offset strength in department store advertising. Classified advertising revenues declined as softness in help-wanted and automotive advertising offset gains in real estate advertising. New England Media Group - Advertising revenues for the New England Media Group decreased 10.0%. National advertising revenues rose mainly because of growth in online advertising. Retail advertising revenues decreased due to the consolidation of the group's two largest department store advertisers. Classified advertising revenues decreased because of weakness in real estate, automotive and help-wanted advertising. Regional Media Group - Advertising revenues for the Regional Media Group rose 0.9%. Retail advertising revenues increased as growth in home improvement, hospital and political advertising offset weakness in banking, grocery and furnishings advertising. Classified advertising revenues decreased as softer automotive and help-wanted advertising offset continued strength in real estate advertising. The Internet ad revenues included in the three media groups above increased 18.9% in September due to continued growth in both display and classified advertising. Internet ad revenues rose 21.4% in the third quarter and 23.1% year to date. TimesSelect, the fee-based product on NYTimes.com that includes The Times's distinctive columnists and extensive access to its archives, currently has over 551,000 subscribers, with about 65% receiving TimesSelect as a benefit of their home-delivery subscriptions and 35% receiving it from online-only subscriptions. Year to date September, TimesSelect has generated over $7 million in revenues, and since its launch last September revenues totaled $8.5 million. Circulation revenues for September decreased 2.7%. Circulation revenues increased at the Regional Media Group and declined at The New York Times Media Group and New England Media Group. About.com - In September, advertising revenues at About.com were up 8.7% compared with the same month last year. Advertising revenues in September 2005 were favorably affected by an accounting adjustment for cost-per-click advertising. Excluding the effect of this adjustment, advertising revenues would have increased about 25% this September. About.com's advertising revenues grew 27.6% in the third quarter and an estimated 56% year-to-date, based on the previous owner's accounting records before the acquisition date in March 2005 and the Times Company's results after the acquisition date. Month to date in October, About.com's advertising revenues have been trending at a rate similar to that of the third quarter. September's growth was due to increases in both cost-per-click and display advertising. Display advertising increased on strength in the retail, telecommunications, technology, pharmaceutical and food ad categories. Discontinued Operations - Last month the Company announced plans to sell its Broadcast Media Group, which is now classified under discontinued operations. Revenues for the Broadcast Media Group for September, the third quarter and the first nine months of 2006 and 2005 are included in the tables in this release. Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those predicted by such forward-looking statements. These risks and uncertainties include national and local conditions, as well as competition, that could influence the levels (rate and volume) of retail, national and classified advertising and circulation generated by our various markets and material increases in newsprint 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 year ended December 25, 2005. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. The New York Times Company (NYSE: NYT), a leading media company with 2005 revenues of $3.4 billion, includes The New York Times, the International Herald Tribune, The Boston Globe, 15 other daily newspapers, nine network-affiliated television stations, two New York City radio stations and 35 Web sites, including NYTimes.com, Boston.com and About.com. The Company's core purpose is to enhance society by creating, collecting and distributing high-quality news, information and entertainment. This press release can be downloaded from www.nytco.com THE NEW YORK TIMES COMPANY 2006 TOTAL COMPANY REVENUES (a) SEPTEMBER AND YEAR TO DATE - --------------- ----------------------------------------------------- Total Company Revenues ($ 000's) September Year to Date ----------------------------------------------------- % % 2006 2005 Change 2006 2005 Change -------- -------- ------ ---------- ---------- ------ Advertising Revenues News Media National $79,116 $80,749 -2.0 $644,659 $659,489 -2.2 Retail 38,893 39,835 -2.4 337,452 342,681 -1.5 Classified 43,962 48,553 -9.5 446,228 452,206 -1.3 Other Ad Revenue 4,830 5,027 -3.9 46,069 44,176 +4.3 -------- -------- ---------- ---------- Total News Media Group 166,802 174,164 -4.2 1,474,408 1,498,552 -1.6 About.com 5,663 5,210 +8.7 53,817 26,277 N/A -------- -------- ---------- ---------- Total Ad Revenues from Continuing Operations 172,464 179,375 -3.9 1,528,225 1,524,829 +0.2 Circulation Revenues 67,779 69,693 -2.7 654,993 655,971 -0.1 Other Revenues (b) 20,189 17,816 +13.3 175,822 159,154 +10.5 -------- -------- ---------- ---------- Total Company Revenues from Continuing Operations 260,432 266,883 -2.4 2,359,040 2,339,954 +0.8 -------- -------- ---------- ---------- Discontinued Operations: Broadcast Media Group (c) 13,023 11,408 +14.2 107,542 101,781 +5.7 -------- -------- ---------- ---------- - --------------- ----------------------------------------------------- (a) Numbers may not add due to rounding. (b) Primarily includes revenues from wholesale delivery operations, news services, direct marketing, digital archives, commercial printing and TimesSelect. (c) In September, the Company announced plans to sell the Broadcast Media Group. THE NEW YORK TIMES COMPANY 2006 TOTAL COMPANY REVENUES (a) THIRD QUARTER - ---------------------------------------------------------------------- Total Company Revenues ($ 000's) Third Quarter -------------------------- % 2006 2005 Change --------- --------- ------ Advertising Revenues News Media National $192,002 $203,142 -5.5 Retail 104,874 107,461 -2.4 Classified 136,890 147,509 -7.2 Other Ad Revenue 14,250 13,852 +2.9 --------- --------- Total News Media Group 448,015 471,964 -5.1 About.com 17,461 13,680 +27.6 --------- --------- Total Ad Revenues from Continuing Operations 465,476 485,644 -4.2 Circulation Revenues 215,007 217,872 -1.3 Other Revenues (b) 59,103 54,287 +8.9 --------- --------- Total Company Revenues from Continuing Operations 739,586 757,803 -2.4 --------- --------- Discontinued Operations: Broadcast Media Group (c) 36,476 33,280 +9.6 --------- --------- - ---------------------------------------------------------------------- (a) Numbers may not add due to rounding. (b) Primarily includes revenues from wholesale delivery operations, news services, direct marketing, digital archives, commercial printing and TimesSelect. (b) In September, the Company announced plans to sell the Broadcast Media Group. THE NEW YORK TIMES COMPANY 2006 ADVERTISING REVENUES (a) SEPTEMBER AND YEAR TO DATE - ---------------------------------------------------------------------- Total Company Advertising Revenues ($ 000's) September Year to date ------------------------------------------------------- % % 2006 2005 Change 2006 2005 Change --------- --------- ------ ---------- ---------- ------ News Media Group New York Times Media Group $104,853 $108,709 -3.5 $885,509 $885,937 0.0 New England Media Group 33,854 37,599 -10.0 307,569 341,767 -10.0 Regional Media Group 28,095 27,857 +0.9 281,330 270,847 +3.9 --------- --------- ---------- ---------- Total News Media Group 166,802 174,164 -4.2 1,474,408 1,498,551 -1.6 About.com 5,663 5,210 +8.7 53,817 26,277 N/A --------- --------- ---------- ---------- Total Ad Revenues from Continuing Operations 172,464 179,375 -3.9 1,528,225 1,524,829 +0.2 --------- --------- ---------- ---------- Discontinued Operations: Broadcast Media Group (b) 12,724 11,114 +14.5 105,669 99,536 +6.2 --------- --------- ---------- ---------- - ---------------------------------------------------------------------- (a) Numbers may not add due to rounding. (b) In September, the Company announced plans to sell the Broadcast Media Group. THE NEW YORK TIMES COMPANY 2006 ADVERTISING REVENUES (a) THIRD QUARTER - ---------------------------------------------------------------------- Total Company Advertising Revenues ($ 000's) Third Quarter -------------------------- % 2006 2005 Change --------- --------- ------ News Media Group New York Times Media Group $261,653 $272,709 -4.1 New England Media Group 97,424 111,181 -12.4 Regional Media Group 88,938 88,074 +1.0 --------- --------- Total News Media Group 448,015 471,964 -5.1 About.com 17,461 13,680 +27.6 --------- --------- Total Ad Revenues from Continuing Operations 465,476 485,644 -4.2 --------- --------- Discontinued Operations: Broadcast Media Group (b) 35,807 32,579 +9.9 --------- --------- - ---------------------------------------------------------------------- (a) Numbers may not add due to rounding. (b) In September, the Company announced plans to sell the Broadcast Media Group. THE NEW YORK TIMES COMPANY 2006 NEWS MEDIA AD REVENUE GROWTH BY CLASSIFIED CATEGORY SEPTEMBER, THIRD QUARTER AND YEAR TO DATE - ---------------------------------------------------------------------- % Change % Change % Change Sept. '06 Q3 '06 YTD '06 vs. Sept. '05 vs. Q3 '05 vs. YTD '05 ------------------------------------ News Media Help Wanted -16.2 -15.1 -8.5 Real Estate -1.3 +2.2 +13.9 Automotive -14.8 -14.8 -14.9 - ---------------------------------------------------------------------- THE NEW YORK TIMES COMPANY 2006 PRINT ADVERTISING VOLUME (a) (Inches in thousands, Preprints in thousands of copies) SEPTEMBER AND YEAR TO DATE - --------------------------------------------------------------------- September Year to Date - --------------------------------------------------------------------- % % 2006 2005 Change 2006 2005 Change -------- -------- ------ ---------- ---------- ------ National 190.6 201.0 -5.2 1,663.0 1,720.9 -3.4 Retail 486.3 498.4 -2.4 4,543.2 4,692.5 -3.2 Classified 724.3 732.0 -1.0 7,210.2 7,252.4 -0.6 -------- -------- ---------- ---------- Total ROP 1,401.3 1,431.4 -2.1 13,416.4 13,665.8 -1.8 -------- -------- ---------- ---------- Part Run/ Zoned 151.7 162.3 -6.5 1,458.5 1,548.3 -5.8 -------- -------- ---------- ---------- Total 1,553.0 1,593.7 -2.6 14,875.0 15,214.1 -2.2 ======== ======== ========== ========== Preprints 218,454 223,605 -2.3 2,060,764 2,092,329 -1.5 - --------------------------------------------------------------------- (a) Advertising volume is based on preliminary internal data, which may be updated in subsequent reports and may not be indicative of advertising revenue or operating profit. Numbers may not add due to rounding. THE NEW YORK TIMES COMPANY 2006 PRINT ADVERTISING VOLUME (a) (Inches in thousands, Preprints in thousands of copies) THIRD QUARTER - --------------------------------------------------------------------- Third Quarter - --------------------------------------------------------------------- % 2006 2005 Change -------- -------- ------ National 497.0 537.8 -7.6 Retail 1,446.0 1,528.5 -5.4 Classified 2,350.4 2,393.8 -1.8 -------- -------- Total ROP 4,293.4 4,460.2 -3.7 -------- -------- Part Run/ Zoned 442.7 482.4 -8.2 -------- -------- Total 4,736.2 4,942.5 -4.2 ======== ======== Preprints 657,709 676,688 -2.8 - --------------------------------------------------------------------- (a) Advertising volume is based on preliminary internal data, which may be updated in subsequent reports and may not be indicative of advertising revenue or operating profit. Numbers may not add due to rounding. CONTACT: The New York Times Company Catherine J. Mathis, 212-556-1981 mathis@nytimes.com OR Paula Schwartz, 212-556-5224 schwap@nytimes.com -----END PRIVACY-ENHANCED MESSAGE-----