DALLAS, July 27 /PRNewswire-FirstCall/ -- Newspaper publisher A. H.
Belo Corporation (NYSE:AHC) reported second quarter 2009 revenues
of $127.5 million and a second quarter net loss of $7.1 million or
$0.34 per share. Second quarter results include $1.7 million or
$0.10 per share for impairment of the customer value management
system at The Dallas Morning News, which was offset by $1.1 million
or $0.08 per share for insurance claim proceeds the Company
received in the second quarter. The Company decommissioned the
customer value management system as part of its ongoing cost
reductions. Excluding these items, the second quarter net loss was
$6.5 million or $0.32 per share. A. H. Belo had $7.8 million in
consolidated EBITDA and $13.1 million in newspaper EBITDA for the
second quarter. The aggregate newspaper EBITDA margin was 10.3
percent. Excluding the insurance claim proceeds, consolidated
EBITDA was $6.7 million. EBITDA margins in the second quarter were
highest at The Providence Journal, followed by The Dallas Morning
News. The Company's borrowings were $3.5 million as of June 30,
2009, down from $12.7 million at the end of the first quarter. A.
H. Belo was in compliance with its bank covenants at the end of the
second quarter. Robert W. Decherd, chairman, president and Chief
Executive Officer, said, "We successfully managed costs in the
second quarter to remain EBITDA positive and significantly pay down
the Company's credit facility. A. H. Belo continues to experience
success with our strategy of providing high quality newspaper
subscribers to our advertisers, resulting in increased circulation
revenue in 2009. In July, The Dallas Morning News went live with a
new integrated advertising system. This new system provides tools
that allow The Morning News sales force to spend more time with
advertisers developing solutions that meet their advertising and
marketing needs. With advertising revenues under pressure, it is
critical that A. H. Belo's sales force has the tools it needs to be
successful." Second Quarter Highlights Total revenue decreased 21.9
percent in the second quarter versus the prior year quarter.
Advertising revenue, including print and Internet revenue, was down
30.2 percent, due to declines in retail, general and classified
revenues in all AHC markets. AHC's Internet revenues accounted for
7.6 percent of total revenues in the quarter. Internet revenues
were $9.8 million, 20.8 percent below the same period last year.
The Company continues to focus on editorial quality and value-added
circulation for its advertisers. In the second quarter, circulation
revenue rose 9.9 percent primarily due to increased prices for
single copy and home delivery in Dallas and Providence. Total
consolidated operating expenses in the second quarter were $132
million, a 21.1 percent decrease from the same period last year.
Excluding the effects of the insurance claim proceeds (which is a
reduction to expense) and the non-cash impairment charge of $1.7
million, total consolidated operating expenses in the second
quarter were $131.4 million, a 21.5 percent decrease from the same
period last year. The decrease reflects reductions in almost all
expense categories. Newsprint expense decreased approximately $5.9
million in the second quarter due to lower prices and volumes.
Corporate and non-operating expenses, net of costs allocated to
operating units, declined by $5.8 million in the second quarter
versus the prior year quarter, primarily due to reduced salaries
and employee benefits. Non-GAAP Financial Measures Reconciliations
of consolidated and newspaper EBITDA to net loss 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 1-612-234-9960 (International). A replay line will be available
at 1-800-475-6701 (USA) or 1-320-365-3844 (International) from 3:00
p.m. CDT on July 27 until 11:59 p.m. CDT on August 3, 2009. The
access code for the replay is 107351. 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-published daily 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 Alison K. Engel, senior vice president/Chief Financial
Officer, at 214-977-2248. 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,
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 Six months ended June 30, June 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 $87,492 $125,341 $176,823 $249,764 Circulation 33,266
30,275 64,980 59,380 Other 6,746 7,639 14,195 14,298 -------
------- ------- ------- Total net operating revenues 127,504
163,255 255,998 323,442 Operating Costs and Expenses Salaries,
wages and employee benefits 51,720 68,840 114,614 143,105 Other
production, distribution and operating costs 50,867 60,948 106,734
121,914 Newsprint, ink and other supplies 16,425 23,738 36,043
46,707 Goodwill impairment - - 80,940 - Asset impairment 1,749 -
1,749 - Depreciation 9,662 12,211 20,198 24,452 Amortization 1,625
1,625 3,249 3,250 ------- ------- ------- ------- Total operating
costs and expenses 132,048 167,362 363,527 339,428 Loss from
operations (4,544) (4,107) (107,529) (15,986) Other (expense) and
income Interest expense (291) (165) (591) (3,231) Other (expense)
income, net (702) 305 120 1,262 ---- --- --- ----- Total other
(expense) income (993) 140 (471) (1,969) Earnings Loss before
income taxes (5,537) (3,967) (108,000) (17,955) Income tax expense
(benefit) 1,534 (770) 2,139 (6,040) ----- --- ----- ----- Net Loss
$(7,071) $(3,197) $(110,139) $(11,915) ====== ====== =======
======== Net loss per share Basic and Diluted $(.34) $(.16) $(5.37)
$(.58) Average shares outstanding Basic and Diluted 20,537 20,478
20,521 20,476 Cash dividends declared per share $- $- $- $0.250 ===
=== === ===== A. H. Belo Corporation Condensed Consolidated Balance
Sheets
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June 30, December 31, In thousands 2009 2008
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(unaudited) Assets Current assets Cash and temporary cash
investments $12,205 $9,934 Accounts receivable, net 52,236 77,383
Other current assets 30,165 37,400 ------ ------ Total current
assets 94,606 124,717 Property, plant and equipment, net 244,563
263,744 Intangible assets, net 55,259 139,449 Other assets 40,170
29,768 ------ ------ Total assets $434,598 $557,678 ======= =======
Liabilities and Shareholders' Equity Current liabilities Current
portion of notes payable $3,540 $10,000 Accounts payable 20,526
32,950 Accrued expenses 39,062 42,834 Other current liabilities
30,142 29,358 ------ ------ Total current liabilities 93,270
115,142 Deferred income taxes 19,093 6,620 Other liabilities 23,003
27,264 Total shareholders' equity 299,232 408,652 ------- -------
Total liabilities and shareholders' equity $434,598 $557,678
======= ======= A. H. Belo Corporation Consolidated EBITDA Three
months ended Six months ended June 30, June 30,
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In thousands (unaudited) 2009 2008 2009 2008
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Consolidated EBITDA (1) $7,790 $10,034 $(1,273) $12,978 Goodwill
impairment - - (80,940) - Asset impairment (1,749) - (1,749) -
Depreciation and Amortization (11,287) (13,836) (23,447) (27,702)
Interest Expense (291) (165) (591) (3,231) Income Tax (Expense)
Benefit (1,534) 770 (2,139) 6,040 ----- ----- ------- ------ Net
Loss $(7,071) $(3,197) $(110,139) $(11,915) ===== ===== =======
====== A. H. Belo Corporation Newspaper EBITDA Three months ended
Six months ended June 30, June 30,
-------------------------------------------------- ----------------
In thousands (unaudited) 2009 2008 2009 2008
-------------------------------------------------- ----------------
Newspaper EBITDA (1) $13,127 $19,305 $10,806 $33,734 Corporate
& Non-Operating Company Expenses (4,635) (9,576) (12,199)
(22,018) Other income, net (702) 305 120 1,262 Goodwill impairment
- - (80,940) - Asset impairment (1,749) - (1,749) - Depreciation
and Amortization (11,287) (13,836) (23,447) (27,702) Interest
Expense (291) (165) (591) (3,231) Income Tax (Expense) Benefit
(1,534) 770 (2,139) 6,040 ----- ----- ------- ------ Net Loss
$(7,071) $(3,197) $(110,139) $(11,915) ===== ===== ======= ======
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: Alison K. Engel, senior
vice president/Chief Financial Officer of A.H. Belo Corporation,
+1-214-977-2248 Web Site: http://www.ahbelo.com/
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