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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): FEBRUARY 10, 1999
CMP MEDIA INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-22789 11-2240940
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification No.)
600 COMMUNITY DRIVE
MANHASSET, NEW YORK 11030
(Address of principal executive offices) (Zip code)
(516) 562-5000
(Registrant's telephone number, including area code)
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CMP MEDIA INC.
INDEX
ITEM 5. OTHER EVENTS ...........................................1-4
SIGNATURE .........................................................5
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ITEM 5. OTHER EVENTS.
On February 10, 1999, CMP Media Inc. issued the following press release:
CMP MEDIA RETAINS LAZARD FRERES & CO. LLC TO EXPLORE STRATEGIC ALTERNATIVES FOR
COMPANY; ANNOUNCES FOURTH QUARTER AND FULL-YEAR RESULTS
Manhasset, NY-- CMP MEDIA INC. (NASDAQ: CMPX) announced that it has retained the
investment banking firm of Lazard Freres & Co. LLC to explore strategic
alternatives for the company including but not limited to a sale or merger. The
company also announced results for its fourth quarter and year ended December
31, 1998.
"Innovation, which drives the thriving technology market that CMP serves, gives
rise to exciting opportunities for companies like ours that are integrally
connected to technology," said Michael S. Leeds, President and CEO of CMP. "We
want to strengthen our position to better capitalize on these opportunities, and
we believe this is a good time for us to investigate all possibilities.
"The goal of this process is to enable us to maximize stockholder value, expand
our ability to provide new products and services to our customers, and enhance
career opportunities for our employees," Leeds said.
The company has not made a decision to pursue any particular alternative and has
indicated that there are no assurances that a transaction will result from the
exploration process.
For the full year ended December 31, 1998, revenues increased to $477.6 million
from the $473.9 million reported for the same period last year. "1998 was CMP's
27th year of uninterrupted revenue growth," Leeds said. "We continued
diversifying into high-growth areas including research, conferences, trade shows
and new Internet services, and our business outside the U.S. grew more than 80
percent in revenues." Operating income for the year was $16.0 million as
compared to $34.9 million in 1997. Net income was $10.0 million, or $0.42 per
share, compared to pro forma net income of $17.3 million, or $0.75 per share,
for 1997.
For the fourth quarter, revenues decreased to $124.9 million as compared to
$132.8 million reported for the fourth quarter of 1997. Operating income for the
fourth quarter was $8.2 million versus $15.4 million last year. Net income was
$4.7 million, or $0.20 per share, compared to pro forma net income of $9.3
million, or $0.39 per share, for the same period in 1997.
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1998 HIGHLIGHTS
Internet
- - On the Internet, CMPnet was the Web's tenth largest site as measured in
advertising revenue, according to InterWatch.
- - The company launched Planet IT (http://www.PlanetIT.com), an exclusive
online community for corporate information technology executives. Industry
leaders Microsoft, Gateway, IBM, Information Builders, 3com, EDS, and
Seagate were charter sponsors.
- - Byte magazine, part of CMP's acquisition of The McGraw-Hill Companies'
computer and communications publications, will re-launch as a Web-only
product, Byte.com, in the first quarter of `99.
U.S. and International Print
- - In the competitive IS print market, InformationWeek grew by 13.8% in ad
pages for the full year, and in the channel market VARBusiness was up 4%,
according to Inquiry Management Systems, Toronto.
- - Data Communications and tele.com, part of the acquisition from The
McGraw-Hill Companies, together with CMP's leading business technology
publications, gave CMP the most comprehensive portfolio reaching business
IT buyers.
- - CMP was once again named the official media sponsor of Telecom '99, the
world's largest technology trade show, which will be held in Geneva in
October. This year, for the first time, we are adding television coverage
of the event.
- - The company continued to expand its offerings in the channel with the
announcement of CRN's Enterprise Partner for systems integrators,
value-added resellers and independent software vendors who work primarily
with Fortune 1000 companies and other large organizations.
- - CMP became the only technology media company to have enterprise and channel
publications in the United Kingdom, France and Germany.
- - Our international networks of leading publications continued to grow
dramatically through our own launches, joint ventures and licensees.
Computer Reseller News is now published in 17 countries, InformationWeek in
13, and Network Computing in 10. Worldwide, CMP now acts as sales
representative for more than 90 leading local publications.
Trade Shows and Conferences
- - In April, CMP acquired Kingbird Media Group LLC, a producer of information
technology conferences and events.
- - In June, the company announced e-Business Expo, a series of groundbreaking
regional conferences and expositions that will bring together those charged
with deploying electronic-business solutions for their companies and those
who can provide them with the necessary products and services. The first
event, which has already met its exhibitor goals, will take place in the
San Jose Convention Center in June and will be followed by a New York event
in December.
- - InformationWeek and BusinessWeek have entered an alliance to feature a
CEO/CIO conference concurrent with e-Business Expo.
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Research, Testing and Consulting
- - Reality Research (http://www.realityresearch.com), headquartered in Austin,
Texas, with satellite offices in London, New York and San Francisco,
provides technology vendors and users with customized research and
consulting services that help them assess and capitalize on the growing
global market for technology products.
- - CMP acquired NSTL, an independent technology testing and consulting firm,
from The McGraw-Hill Companies. NSTL which serves the government, the
technology vendor community and end users, is planning to expand its
services in Asia and Western Europe this year.
- - Customer First, an ambitious sales and support initiative created to
provide customers with a single point of access for large portfolios of CMP
products across multiple media, was rolled out nationally.
Customer reaction has been extremely positive.
In connection with its initial public offering of 5,485,000 shares of Class A
Common Stock on July 25, 1997, the company terminated its S corporation election
and converted to C corporation status. Pro forma net income and pro forma net
income per share for 1997 are presented as if the company had been a C
corporation prior to January 1, 1997.
CMP Media Inc. (Nasdaq: CMPX) is a leading high-tech media company providing
essential information and marketing services to the entire technology
spectrum--the builders, sellers and users of technology worldwide. With its
portfolio of publications, custom publishing, Internet products, research and
conferences, CMP is uniquely positioned to offer marketers comprehensive,
integrated solutions tailored to meet their individual needs. Online editions of
the company's print publications, along with products and services created
exclusively for the Internet, can be found on CMPnet at http://www.CMPnet.com.
NSTL, the company's independent testing lab, serves government, corporate and
technology clients around the world.
This release may contain forward-looking statements that are subject to risks
and uncertainties. CMP's actual results could differ materially from those
discussed in such forward-looking statements, due to various factors which are
outside CMP's control. Factors that could affect performance include decreased
demand for technology advertising, delays in new product introductions by
advertisers, the failure of advertisers to adopt new products and services
offered by CMP, economic instability in Asian and other foreign markets, and
costs of integrating newly acquired products and services into CMP operations.
For a more detailed discussion of these factors and others, see CMP's Securities
and Exchange Commission filings.
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CMP MEDIA INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
IN THOUSANDS, EXCEPT PER SHARE AMOUNTS
<TABLE>
<CAPTION>
FOR THE THREE MONTHS FOR THE YEAR
ENDED DECEMBER 31, ENDED DECEMBER 31,
----------------------------- -----------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C>
Revenues $ 124,851 $ 132,754 $ 477,561 $ 473,851
Operating costs and expenses:
Cost of revenues 54,245 52,676 209,883 188,965
Selling and promotion 43,389 45,445 164,902 160,579
General and administrative 19,052 19,191 86,740 84,971
Non-recurring compensation charge -- -- -- 4,449
----------- ----------- ----------- -----------
Income from operations 8,165 15,442 16,036 34,887
----------- ----------- ----------- -----------
Gain on sales -- 969 1,320 4,011
Other income (expense), net 159 133 228 (8,161)
----------- ----------- ----------- -----------
Income before provision for income taxes $ 8,324 $ 16,544 $ 17,584 $ 30,737
Provision for income taxes 3,588 3,139 7,579 450
----------- ----------- ----------- -----------
Net income $ 4,736 $ 13,405 $ 10,005 $ 30,287
=========== =========== =========== ===========
Net income per share - diluted $ 0.20 $ 0.42
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Weighted average number of shares of common
stock and dilutive securities 23,412,337 23,907,604
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Pro Forma Data:
Historical income before provision
for income taxes $ 16,544 $ 30,737
Pro forma provision for income taxes 7,213 13,401
----------- -----------
Pro forma net income $ 9,331 $ 17,336
=========== ===========
Pro forma net income per share - diluted $ 0.39 $ 0.75
=========== ===========
Pro forma weighted average number of shares
of common stock and dilutive securities 24,033,162 23,206,073
=========== ===========
</TABLE>
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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 hereunto duly authorized.
CMP MEDIA INC.
February 18, 1999 By: /s/ Joseph E. Sichler
--------------------------------------------
Joseph E. Sichler
Vice President and Chief Financial Officer
(Principal Accounting Officer)
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