DALLAS, Oct. 30 /PRNewswire-FirstCall/ -- Newspaper publisher A. H.
Belo Corporation (NYSE:AHC) reported third quarter 2009 revenues of
$126.9 million and a net loss of ($5.8) million, or ($0.28) per
share, for the third quarter. Included in the net loss was a $20
million, or ($0.97) per share non-cash impairment charge and a $12
million or $0.58 per share, tax benefit. During the third quarter,
A. H. Belo recorded a $20 million non-cash impairment charge
related to a packaging facility operated by The Dallas Morning
News. As part of the Company's ongoing efforts to realign its
business and reduce expenses, The Dallas Morning News will close
the packaging facility as it consolidates production operations
into a single facility located in Plano, Texas. This consolidation
of production facilities should be completed in the first quarter
of 2010. The Company has begun the process of marketing the
packaging facility for sale. In September 2009, A. H. Belo and Belo
Corp. ("Belo") amended the tax matters agreement executed between
the two companies at the time of A. H. Belo's spin-off from Belo in
2008. The amendment allows for the carry back of A. H. Belo's
losses since February 2008 to Belo's pre-spin-off tax returns.
After the tax matters agreement was amended, Belo amended a
previously filed tax return to generate a $12 million federal
income tax refund. Belo will apply the refund towards A. H. Belo's
future pension obligations and expects the refund to cover any 2010
pension contributions required of A. H. Belo. Correspondingly, A.
H. Belo reversed the associated valuation allowance on its deferred
tax assets related to the net operating losses carried back by
Belo, resulting in a $12 million tax benefit for A. H. Belo. In the
third quarter, excluding the non-cash impairment charge, A. H. Belo
generated $14.2 million of consolidated EBITDA and $19.4 million of
newspaper EBITDA. The consolidated and newspaper EBITDA margins
were 11.2 percent and 15.3 percent, respectively. EBITDA margins
were highest at The Providence Journal, followed by The Dallas
Morning News and The Press-Enterprise. As of September 30, 2009, A.
H. Belo had no borrowings outstanding under its bank credit
facility and remained in compliance with the facility's covenants.
Robert W. Decherd, chairman, president and Chief Executive Officer,
said, "The year-to-year percent decline in advertising revenue
eased slightly in the third quarter when compared to the first and
second quarters of 2009 due to the improved performance of The
Dallas Morning News. For the third quarter, A. H. Belo successfully
managed costs and increased consolidated EBITDA by $6.4 million
versus the second quarter of 2009 and $22.5 million versus the
third quarter of 2008. We are pleased with the recent improvements
in the quantity and quality of The Morning News' journalistic
products and the related opportunity to increase circulation
pricing. Third Quarter Highlights Total revenue decreased 17.5
percent in the third quarter versus the prior year quarter.
Advertising revenue, including print and Internet revenues,
decreased 27.0 percent, and classified revenue decreased 40.6
percent. In Dallas, the percent decline in advertising revenue was
less than in Providence and Riverside. AHC's Internet revenue was
$9.7 million and represented 7.6 percent of total revenue in the
quarter. Although Internet revenue decreased 15.0 percent versus
the same period last year, non-classified Internet revenue
increased 15.6 percent. The Company continues to focus on
high-quality, local content and value-added circulation for its
advertisers. In the third quarter, circulation revenue rose 11.6
percent due to pricing actions taken by The Dallas Morning News and
The Providence Journal in late 2008 and thus far in 2009. Total
consolidated operating expenses in the third quarter were $143.8
million, a decrease of $35.4 million or 19.8 percent versus the
same period last year. Excluding impairment charges in both
periods, total consolidated operating expenses in the third quarter
were $123.8 million, a decrease of $50.9 million or 29.1 percent
versus the same period last year. Newsprint expense fell $9.5
million, a decline of 50.7 percent versus the same period last
year, as both newsprint volume and prices declined. Corporate and
non-operating expenses, net of costs allocated to operating units,
decreased by $3.9 million, or 36.6 percent in the third quarter
versus the prior year quarter. This decrease is primarily due to
lower outside services expense and the modification of a service
agreement, which resulted in a one-time credit of $0.8 million.
Non-GAAP Financial Measures Reconciliations of consolidated and
newspaper EBITDA to net income are included as exhibits to this
release. Financial Results Conference Call AHC will conduct a
conference call today at 1:00 p.m. CDT to discuss financial
results. The conference call will be available via Webcast by
accessing the Company's Web site (http://www.ahbelo.com/invest) or
by dialing 1-800-230-1059 (USA) or 612-234-9960 (International). A
replay line will be available at 800-475-6701 (USA) or 320-365-3844
(International) from 3:00 p.m. CDT on October 30 until 11:59 p.m.
CST on November 6, 2009. The access code for the replay is 118270.
About A. H. Belo Corporation A. H. Belo Corporation (NYSE:AHC),
headquartered in Dallas, Texas, is a distinguished newspaper
publishing and local news and information company that owns and
operates four daily newspapers and a diverse group of Web sites. A.
H. Belo publishes The Dallas Morning News, Texas' leading newspaper
and winner of eight Pulitzer Prizes since 1986; The Providence
Journal, the oldest continuously-publisheddaily newspaper in the
U.S. and winner of four Pulitzer Prizes; The Press-Enterprise
(Riverside, CA), serving southern California's Inland Empire region
and winner of one Pulitzer Prize; and the Denton Record-Chronicle.
The Company publishes various specialty publications targeting
niche audiences, and its partnerships and/or investments include
the Yahoo! Newspaper Consortium and Classified Ventures, owner of
cars.com. A. H. Belo also owns direct mail and commercial printing
businesses. Additional information is available at
http://www.ahbelo.com/ or by contacting David A. Gross, vice
president/Investor Relations and Strategic Analysis, at
214-977-4810. Statements in this communication concerning A. H.
Belo Corporation's (the "Company's") business outlook or future
economic performance, anticipated profitability, revenues,
expenses, dividends, capital expenditures, investments,
impairments, future financings, and other financial and
non-financial items that are not historical facts, are
"forward-looking statements" as the term is defined under
applicable federal securities laws. Forward-looking statements are
subject to risks, uncertainties and other factors that could cause
actual results to differ materially from those statements. Such
risks, uncertainties and factors include, but are not limited to,
changes in capital market conditions and prospects, and other
factors such as changes in advertising demand, interest rates, and
newsprint prices; newspaper circulation trends and other
circulation matters, including changes in readership patterns and
demography, and audits and related actions by the Audit Bureau of
Circulations; challenges in achieving expense reduction goals, and
on schedule, and the resulting potential effects on operations;
technological changes; development of Internet commerce; industry
cycles; changes in pricing or other actions by competitors and
suppliers; regulatory, tax and legal changes; adoption of new
accounting standards or changes in existing accounting standards by
the Financial Accounting Standards Board or other accounting
standard-setting bodies or authorities; the effects of Company
acquisitions, dispositions, co-owned ventures, and investments;
general economic conditions; significant armed conflict; and other
factors beyond our control, as well as other risks described in the
Company's Annual Report on Form 10-K for the year ended December
31, 2008. A. H. Belo Corporation Consolidated Statements of
Operations Three months ended Nine months ended September 30,
September 30,
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In thousands, except per share amounts 2009 2008 2009 2008
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(unaudited) (unaudited) (unaudited) (unaudited) Net operating
revenues Advertising $83,816 $114,811 $260,638 $364,575 Circulation
35,228 31,563 100,208 90,943 Other 7,823 7,459 22,019 21,757 -----
----- ------ ------ Total net operating revenues 126,867 153,833
382,865 477,275 Operating Costs and Expenses Salaries, wages and
employee benefits 51,668 77,804 166,283 220,909 Other production,
distribution and operating costs 48,920 60,768 155,652 182,682
Newsprint, ink and other supplies 12,302 23,523 48,345 70,230 Asset
impairment 20,000 4,535 102,689 4,535 Depreciation 9,257 10,962
29,456 35,414 Amortization 1,625 1,625 4,874 4,875 ----- -----
----- ----- Total operating costs and expenses 143,772 179,217
507,299 518,645 Loss from operations (16,905) (25,384) (124,434)
(41,370) Other (expense) and income Interest expense (211) (52)
(802) (3,283) Other income (expense), net 240 (25) 362 1,237 ---
--- --- ----- Total other (expense) income 29 (77) (440) (2,046)
Earnings Loss before income taxes (16,876) (25,461) (124,874)
(43,416) Income tax benefit (11,110) (8,203) (8,970) (14,243)
------- ------ ------ ------- Net Loss $(5,766) $(17,258)
$(115,904) $(29,173) ======= ======== ========= ======== Net loss
per share Basic and Diluted $(.28) $(.84) $(5.65) $(1.42) Average
shares outstanding Basic and Diluted 20,538 20,479 20,521 20,477
Cash dividends declared per share $- $0.375 $- $0.625 == ====== ==
====== A. H. Belo Corporation Condensed Consolidated Balance Sheets
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September 30, December 31, In thousands 2009 2008
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(unaudited) Assets Current assets Cash and cash equivalents $10,825
$9,934 Accounts receivable, net 57,697 77,383 Other current assets
25,161 37,400 ------ ------ Total current assets 93,683 124,717
Property, plant and equipment, net 218,133 263,744 Intangible
assets, net 53,634 139,449 Other assets 26,957 29,768 ------ ------
Total assets $392,407 $557,678 ======== ======== Liabilities and
Shareholders' Equity Current liabilities Current portion of notes
payable $- $10,000 Accounts payable 14,364 32,950 Accrued expenses
32,701 42,834 Other current liabilities 30,821 29,358 ------ ------
Total current liabilities 77,886 115,142 Deferred income taxes
5,266 6,620 Other liabilities 15,322 27,264 Total shareholders'
equity 293,933 408,652 ------- ------- Total liabilities and
shareholders' equity $392,407 $557,678 ======== ======== A. H. Belo
Corporation Consolidated EBITDA Three months ended Nine months
ended September 30, September 30,
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In thousands (unaudited) 2009 2008 2009 2008
------------------------------------------------ -----------------
Consolidated EBITDA (1) $14,217 $(8,287) $12,947 $4,691 Asset
impairment (20,000) (4,535) (102,689) (4,535) Depreciation and
Amortization (10,882) (12,587) (34,330) (40,289) Interest Expense
(211) (52) (802) (3,283) Income Tax (Expense) Benefit 11,110 8,203
8,970 14,243 ------ ----- ----- ------ Net Loss $(5,766) $(17,258)
$(115,904) $(29,173) ======= ======== ========= ======== A. H. Belo
Corporation Newspaper EBITDA Three months ended Nine months ended
September 30, September 30,
------------------------------------------------ -----------------
In thousands (unaudited) 2009 2008 2009 2008
------------------------------------------------ -----------------
Newspaper EBITDA (1) $19,427 $1,468 $30,232 $35,202 Corporate &
Non-Operating Company Expenses (5,450) (9,730) (17,647) (31,748)
Other income, net 240 (25) 362 1,237 Asset impairment (20,000)
(4,535) (102,689) (4,535) Depreciation and Amortization (10,882)
(12,587) (34,330) (40,289) Interest Expense (211) (52) (802)
(3,283) Income Tax (Expense) Benefit 11,110 8,203 8,970 14,243
------ ----- ----- ------ Net Loss $(5,766) $(17,258) $(115,904)
$(29,173) ======= ======== ========= ======== Note 1: The Company
defines Consolidated EBITDA as net earnings before interest
expense, income taxes, goodwill impairment, depreciation and
amortization and Newspaper EBITDA as net earnings before corporate
and non-operating company expenses, other income net, interest
expense, income taxes, goodwill impairment, depreciation and
amortization. Neither Consolidated EBITDA nor Newspaper EBITDA is a
measure of financial performance under accounting principles
generally accepted in the United States. Management uses both
measures in internal analyses as a supplemental measure of the
financial performance of the Company to assist it with determining
bonus achievement, performance comparisons against its peer group
of companies, as well as capital spending and other investing
decisions. They are also common alternative measures of performance
used by investors, financial analysts, and rating agencies to
evaluate financial performance. Neither Consolidated EBITDA nor
Newspaper EBITDA should be considered in isolation or as a
substitute for cash flows provided by operating activities or other
income or cash flow data prepared in accordance with U.S. GAAP and
this non-GAAP measure may not be comparable to similarly titled
measures of other companies. DATASOURCE: A. H. Belo Corporation
CONTACT: David A. Gross, vice president/Investor Relations and
Strategic Analysis of A. H. Belo Corporation, +1-214-977-4810 Web
Site: http://www.ahbelo.com/
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