UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTERLY PERIOD ENDED June 26, 1994
------------------
COMMISSION FILE NUMBER 1-7553
------
KNIGHT-RIDDER, INC.
- - ---------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
FLORIDA 38-0723657
- - --------------------------------------------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
ONE HERALD PLAZA, MIAMI, FLORIDA 33132
----------------------------------------
(Address of principal executive offices)
(305) 376-3800
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(Registrant's telephone number, including area code)
NOT APPLICABLE
- - ----------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report.)
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
----- ----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date. Common Stock, $.02 1/12 Par
Value-53,598,688 shares as of July 31, 1994 .
-1-
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Table of Contents for 10-Q
Page
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Statements of Income 3-4
Consolidated Balance Sheets 5-6
Consolidated Statements of Cash Flows 7-8
Notes to Consolidated Financial Statements 9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 10-12
PART II. OTHER INFORMATION
Item 6 - Exhibits and Reports on 8-K 13
SIGNATURE 14
Exhibit 11 Statement Re: Computation of Per Share Earnings 15
Exhibit 28 Additional Exhibits 16-19
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<TABLE>
<CAPTION>
Consolidated Statement Of Income (Unaudited, in thousands of dollars, except share data)
Quarter Ended Two Quarters Ended Four Quarters Ended
---------------------- --------------------- ------------------------
June 26 June 27 June 26 June 27 June 26 June 27
1994 1993 1994 1993 1994 1993
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
OPERATING REVENUE
Newspapers
Advertising
Retail $ 194,840 $ 191,144 $ 368,866 $ 360,861 $ 774,110 $ 764,965
General 45,453 44,606 92,534 87,521 173,786 168,282
Classified 155,671 141,733 301,083 276,934 570,902 531,938
--------- --------- --------- --------- --------- ---------
Total 395,964 377,483 762,483 725,316 1,518,798 1,465,185
Circulation 121,591 118,850 242,315 235,833 480,902 465,606
Other 16,575 14,349 31,202 27,351 60,623 47,854
--------- --------- --------- --------- --------- ---------
Total Newspapers 534,130 510,682 1,036,000 988,500 2,060,323 1,978,645
Business Information Services 127,420 111,000 256,413 217,076 477,862 410,491
--------- --------- --------- --------- --------- ---------
Total Operating Revenue 661,550 621,682 1,292,413 1,205,576 2,538,185 2,389,136
--------- --------- --------- --------- --------- ---------
OPERATING COSTS
Labor and employee benefits 267,984 255,323 536,379 508,699 1,051,861 1,009,775
Newsprint, ink and supplements 79,918 84,916 159,312 164,974 329,381 321,357
Other operating costs 181,147 168,834 362,265 331,730 696,044 645,106
Depreciation and amortization 37,215 36,364 74,361 70,248 145,871 133,871
--------- --------- --------- --------- --------- ---------
Total Operating Costs 566,264 545,437 1,132,317 1,075,651 2,223,157 2,110,109
--------- --------- --------- --------- --------- ---------
OPERATING INCOME 95,286 76,245 160,096 129,925 315,028 279,027
--------- --------- --------- --------- --------- ---------
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OTHER INCOME (EXPENSE)
Interest expense (11,662) (12,442) (22,184) (25,637) (41,659) (51,338)
Interest expense capitalized 7 13 63 18 165 978
Interest income 1,350 1,426 2,615 3,180 5,147 6,004
Other, net 281 (232) (3,666) (3,505) (2,337) (9,399)
--------- --------- --------- --------- --------- ---------
Total (10,024) (11,235) (23,172) (25,944) (38,684) (53,755)
--------- --------- --------- --------- --------- ---------
Income before income taxes 85,262 65,010 136,924 103,981 276,344 225,272
Income taxes 35,141 22,513 56,431 38,348 113,395 84,649
--------- --------- --------- --------- --------- ---------
Net income $ 50,121 $ 42,497 $ 80,493 $ 65,633 $ 162,949 $ 140,623
========= ========= ========= ========= ========= =========
EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE $ 0.92 $ 0.77 $ 1.47 $ 1.18 $ 2.96 $ 2.53
========= ========= ========= ========= ========= =========
DIVIDENDS DECLARED PER
COMMON SHARE $ 0.37 * $ 0.35 $ 0.72 $ 0.70 $ 1.42 $ 1.40
========= ========= ========= ========= ========= =========
AVERAGE COMMON AND COMMON
EQUIVALENT SHARES
OUTSTANDING (000s) 54,548 55,476 54,890 55,611 54,971 55,535
========= ========= ========= ========= ========= =========
* Dividends for the second quarter of 1994 were declared on June 28, 1994.
See "Notes to Consolidated Financial Statements" and statistical data on pages 9 and 18.
</TABLE>
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<TABLE>
<CAPTION>
Consolidated Balance Sheet (Unaudited, in thousands of dollars, except share data)
June 26 December 26 June 27
1994 1993 1993
--------- --------- ---------
<S> <C> <C> <C>
Assets
CURRENT ASSETS
Cash, including short-term cash investments of $7,493
in 1994, $7,638 in December 1993 and $150 in June 1993 $ 22,836 $ 23,012 $ 9,565
Accounts receivable, net of allowances of $14,760 in
1994, $14,554 in December 1993 and $14,167 in
June 1993 291,237 274,391 262,158
Inventories 39,519 41,422 50,621
Other current assets 58,436 62,491 82,638
--------- --------- ---------
Total Current Assets 412,028 401,316 404,982
--------- --------- ---------
INVESTMENTS AND OTHER ASSETS
Equity in unconsolidated companies and joint ventures 287,174 289,986 286,858
Other 180,335 175,058 160,276
--------- --------- ---------
Total Investments and Other Assets 467,509 465,044 447,134
--------- --------- ---------
PROPERTY, PLANT AND EQUIPMENT
Land and improvements 66,880 66,885 65,462
Buildings and improvements 378,803 379,556 380,804
Equipment 1,193,804 1,168,054 1,158,465
Construction and equipment installations in progress 9,871 13,100 11,478
--------- --------- ---------
1,649,358 1,627,595 1,616,209
Less accumulated depreciation 806,827 766,474 735,517
--------- --------- ---------
Net Property, Plant and Equipment 842,531 861,121 880,692
--------- --------- ---------
EXCESS OF COST OVER NET ASSETS ACQUIRED
Less accumulated amortization of $171,400 in 1994,
$160,545 in December 1993 and $150,563 in June 1993 717,954 703,951 706,375
--------- --------- ---------
TOTAL $2,440,022 $2,431,432 $2,439,183
========= ========= =========
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Liabilities and Shareholders' Equity
CURRENT LIABILITIES
Accounts payable $ 131,857 $ 124,620 $ 128,571
Accrued expenses and other liabilities 82,563 82,149 88,709
Accrued compensation and amounts withheld from employees 78,463 79,736 77,834
Federal and state income taxes 14,972 10 12,125
Deferred revenue 59,770 60,095 54,030
Dividends payable 19,199 19,093
Short-term borrowings and current portion of long-term
debt 40,000 40,687 42,750
--------- --------- ---------
Total Current Liabilities 407,625 406,496 423,112
--------- --------- ---------
NON-CURRENT LIABILITIES
Long-term debt 417,414 410,388 455,666
Deferred federal and state income taxes 146,064 135,979 119,707
Postretirement benefits other than pensions 169,306 174,331 174,706
Employment benefits and other non-current liabilities 62,374 57,816 77,730
--------- --------- ---------
Total Non-Current Liabilities 795,158 778,514 827,809
--------- --------- ---------
MINORITY INTERESTS 2,825 3,253 2,646
--------- --------- ---------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Common Stock, $.02 1/12 par value; shares authorized -
250,000,000; shares issued - 53,675,913 in 1994,
54,847,486 in December 1993 and 54,569,041 in June 1993 1,118 1,143 1,137
Additional capital 333,159 342,201 328,781
Retained earnings 900,137 899,825 855,698
--------- --------- ---------
Total Shareholders' Equity 1,234,414 1,243,169 1,185,616
--------- --------- ---------
TOTAL $2,440,022 $2,431,432 $2,439,183
========= ========= =========
See "Notes to Consolidated Financial Statements" and statistical data on pages 9 and 18.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Consolidated Statement of Cash Flows (Unaudited, in thousands of dollars)
Quarter Ended Two Quarters Ended Four Quarters Ended
----------------- ----------------- -----------------
June 26 June 27 June 26 June 27 June 26 June 27
1994 1993 1994 1993 1994 1993
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
CASH PROVIDED BY(REQUIRED FOR)OPERATING ACTIVITIES
Net income $ 50,121 $ 42,497 $ 80,493 $ 65,633 $ 162,949 $ 140,623
Non-cash items included in income:
Depreciation 26,599 26,807 53,223 51,870 105,667 98,305
Amortization of excess of cost over
net assets acquired 5,489 4,962 10,855 9,772 20,837 19,210
Amortization of other assets 5,127 4,595 10,283 8,606 19,367 16,356
Provision for non-current deferred taxes 6,300 6,539 10,085 5,508 26,357 23,062
Distributions from investees in excess
of (less than) earnings (2,360) (10,497) 704 (13,514) (8,584) (18,601)
Other items, net 9,403 9,019 18,638 17,842 30,380 32,310
Change in certain assets and liabilities:
Accounts receivable (17,094) (9,965) (14,664) 8,167 (26,208) (15,909)
Inventories (1,477) (4,797) 1,903 (13,124) 11,226 (16,269)
Other current assets 14,405 3,859 2,741 (18,878) 24,705 (4,151)
Accounts payable 9,378 5,233 6,918 16,424 (2,309) 41,870
Federal and state income taxes 6,949 5,796 14,962 10,839 7,665 (12,881)
Other current liabilities (3,923) (4,742) (4,267) (1,513) 2,193 4,947
------- ------- ------- ------- ------- -------
Net cash provided by operating activities 108,917 79,306 191,874 147,632 374,245 308,872
------- ------- ------- ------- ------- -------
CASH REQUIRED FOR INVESTING ACTIVITIES
Additions to property, plant and equipment (15,870) (17,251) (30,042) (41,653) (57,930) (76,319)
Other items, net (6,572) (5,687) (40,878) (47,530) (74,394) (114,566)
-------- -------- -------- -------- -------- --------
Net cash required for investing activities (22,442) (22,938) (70,920) (89,183) (132,324) (190,885)
-------- -------- -------- -------- -------- --------
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<PAGE>
CASH PROVIDED BY (REQUIRED FOR) FINANCING ACTIVITIES
Proceeds from sale of commercial paper and
bank borrowings 76,455 128,510 207,413 185,855 329,541 272,591
Reduction of total debt (75,731) (143,940) (201,074) (247,826) (370,401) (294,016)
-------- -------- -------- -------- -------- --------
Net change in total debt 724 (15,430) 6,339 (61,971) (40,860) (21,425)
Payment of cash dividends (19,107) (19,326) (38,304) (38,564) (76,527) (76,823)
Sale of common stock to employees 6,535 3,991 15,717 16,272 30,154 41,380
Purchase of treasury stock and stock tendered
under stock option plans (60,738) (39,682) (85,860) (39,682) (86,871) (39,682)
Other items, net (11,278) (8,704) (19,022) (22,043) (54,546) (43,185)
-------- -------- -------- -------- -------- --------
Net cash required for financing activities (83,864) (79,151) (121,130) (145,988) (228,650) (139,735)
-------- -------- -------- -------- -------- --------
Net Increase (Decrease) in Cash 2,611 (22,783) (176) (87,539) 13,271 (21,748)
Cash and short-term cash
investments at beginning of the period 20,225 32,348 23,012 97,104 9,565 31,313
-------- -------- -------- -------- -------- --------
Cash and short-term cash
investments at end of the period $ 22,836 $ 9,565 $ 22,836 $ 9,565 $ 22,836 $ 9,565
======== ======== ======== ======== ======== ========
Working capital at end of the period $ 4,403 $ (18,130) $ 4,403 $ (18,130) $ 4,403 $ (18,130)
======== ======== ======== ======== ======== ========
See "Notes to Consolidated Financial Statements" and statistical data on pages 9 and 18.
</TABLE>
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<TABLE>
<CAPTION>
Notes to Consolidated Financial Statements (Unaudited)
Note 1 - Debt (In thousands of dollars)
Effective
Interest Balance at
Rate at --------------------------------
June 26 June 26 December 26 June 27
1994 1994 1993 1993
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Commercial paper, net of discount 4.0 % $100,849 $ 53,985 $ 99,431
Notes payable, net of discount (a) 8.6 159,017 198,930 198,827
Debentures, net of discount (b) 10.0 197,548 197,472 197,390
Other indebtedness 688 2,768
-------- -------- --------
Total debt (c) 8.2 457,414 451,075 498,416
Less amounts classified as current 4.0 40,000 40,687 42,750
-------- -------- --------
Total long-term debt 8.6 % $417,414 $410,388 $455,666
======== ======== ========
(a) Represents $160 million of 8 1/2% Notes subject to mandatory pro rata amortization of 25%
annually commencing in 1998 through maturity in 2001, and a $40 million 9.05% Note which matured
and was redeemed on January 15, 1994.
(b) Represents $200 million of 20-year 9 7/8% debentures due in 2009.
(c) At June 26, 1994 and June 27, 1993, interest payments of $22.1 million and $29.0 million
had been made for the year-to-date, respectively.
Note 2 - Income Tax Expense
Income tax payments for the two quarters ended June 26, 1994 and June 27, 1993, were $23.3 million
and $20.7 million respectively.
</TABLE>
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<PAGE>
Management's Discussion and Analysis of the Second Quarter
Second Quarter 1994
Compared With Second Quarter 1993
Earnings per share for the second quarter of 1994 increased by 19.5% to $.92
per share, compared with $.77 per share in 1993. Earnings per share for the
first two quarters of 1994 were $1.47 compared with $1.18 in 1993, a 24.6%
improvement.
Operating Revenue
Newspaper advertising revenue increased by 4.9% over the second quarter last
year, on a full-run ROP linage increase of 2.1%.
Retail advertising revenue increased $3.7 million, or 1.9%, over last year on
a 1.2% decline in full-run ROP linage. Improved average rates and an
increase in preprint revenue more than offset the drop in linage. Retail
revenue is up 2.2% for the year-to-date, on a 1.3% decrease in full-run ROP
linage.
General advertising revenue increased by $847,000, or 1.9%, from last year on
a 3.3% improvement in full-run ROP linage. For the year-to-date general
revenue is up 5.7% on a 7.8% rise in full-run ROP linage.
Classified advertising revenue improved by 9.8% over the second quarter last
year, on a 5.8% full-run ROP linage increase. The employment revenue
category has shown the biggest gain, up 21.2%. For the first two quarters,
classified revenue is up 8.7% on a 5.1% full-run ROP linage improvement.
Classified has shown full-run ROP linage year-over-year improvement for each
of the last eight quarters.
Circulation revenue increased $2.7 million, or 2.3%, due to a 3.9% increase
in average rates, offset by a slight decline in circulation. Revenue is up
2.7% so far this year.
Other newspaper revenues improved by $2.2 million, or 15.5%, primarily due to
various efforts to augment traditional newspaper revenues with new related
revenue sources.
Business Information Services (BIS) revenue in the second quarter increased
$16.4 million, or 14.8%, due in part to recent acquisitions and joint
ventures. Business Information Services revenue is up 18.1% for the year-to-
date, again reflecting the impact of the acquisitions.
Excluding the impact of joint ventures and recent acquisitions, division
revenue was 7.5% over the second quarter last year and 8.2% higher than the
first two quarters of 1993.
Operating Costs
Labor and employee benefit costs rose $12.7 million, or 5.0%, on a 0.1%
increase in the work force and a 5.3% increase in average wage. If not for
recent BIS acquisitions and expansion, the workforce would have been down,
due to reductions in the Newspaper Division.
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<PAGE>
Newsprint, ink and supplements costs decreased $5.0 million, or 5.9%, on a
6.0% decrease in average newsprint price. These costs are down 3.4% for the
first two quarters on a 0.9% rise in newsprint consumption and a 4.2% average
price decrease.
Other operating costs rose $12.3 million, or 7.3%. The increase resulted
primarily from volume related exchange fee expense in the BIS Division,
increased distribution costs resulting from an emphasis on alternate delivery
and increased circulation promotion costs.
Non-Operating Items and Income Taxes
Interest expense, net of interest income and interest expense capitalized,
decreased by $698,000, or 6.3% due primarily to lower debt levels. The
average debt balance for the quarter was down almost $39 million, or 7.4%,
from the second quarter of last year.
The effective tax rate for the second quarter 1994 was 41.2% compared to
34.6% in the second quarter 1993. The 1.0% increase in the statutory tax
rate enacted by Congress in the third quarter 1993, and a second quarter 1993
favorable tax adjustment were major factors in the increase compared to
second quarter last year.
Other
In April 1994, the Journal of Commerce formed a joint venture partnership
with American Systems, Inc., which specializes in the development of custom
software solutions for the transportation industry. The joint venture,
Transax Systems, provides tariff filing and retrieval products, and its
results are included in the BIS Division for the second quarter.
On June 28, 1994, the Board of Directors increased the quarterly dividend by
5.7% to $.37 per share. At the same time the Board authorized the repurchase
of up to three million shares of Knight-Ridder common stock, in addition to
approximately 750,000 shares remaining under an earlier authorization. In
the first two quarters, the company purchased approximately 1.5 million
shares under the earlier authorization. The company will be buying in the
market from time to time.
Outlook for the Remainder of the Year
We have continued the positive momentum of the first quarter, and we expect
1994 to be a year of very healthy earnings growth. Classified continues to
be strong and retail and general advertising growth are firming up. For the
year, we expect the average cost of newsprint to be about flat with 1993, and
we look forward to additional improvement from Philadelphia, which is
realizing its expected reductions in transition costs related to the new
plant.
Additionally, our results continue to be bolstered by the BIS Division
acquisitions, and the impact of its global expansion.
-11-
<PAGE>
Liquidity
Net cash provided by operating activities increased to $108.9 million from
$79.3 million in the second quarter of 1993, due to improved earnings and
distributions from investees and changes in several working capital
components. Current liabilities for the second quarter 1994 did not include
approximately $19.9 million of dividends which were declared on June 28,
1994, after the end of the second quarter. Dividends to shareholders are
normally declared prior to the quarter end and recorded as current
liabilities.
Cash and equivalents were up $2.6 million from last quarter and down $176,000
from year end. Total debt was increased $724,000 during the quarter and $6.3
million from year end. This slight increase in debt resulted from the
anticipated share repurchase program and the 1994 BIS acquisitions. Both of
these were, in large part, funded through internally generated cash flow.
The long-term-debt-to-equity ratio was 33.8%, up slightly from 33.0% at year
end, and down from 38.4% last June. The total-debt-to-total-capital ratio
was 27% compared with 26.6% at year end and 29.6% in June 1993. Approximately
$400 million in aggregate unused credit lines remained at the end of the
quarter. The ratio of current assets to current liabilities was 1.0:1 at
June 26, 1994, Dec. 26, 1993, and at June 27, 1993.
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PART II. OTHER INFORMATION
OTHER INFORMATION
-----------------
Items 1, 2, 3, 4 and 5 are omitted as inapplicable,
not required, or because the information is included in the
consolidated financial information.
Item 6 Exhibits and Reports on Form 8-K
--------------------------------
a. Exhibits Filed
No. 11 - Statement Re: Computation of Per Share
Earnings
No. 28 - Additional Exhibits
b. Reports on Form 8-K
No reports were filed on Form 8-K during the quarter
ended June 26, 1994.
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<PAGE>
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 thereunto duly authorized.
KNIGHT-RIDDER, INC.
(Registrant)
Date August 9, 1994
Tally Liu, Vice President/Finance
and Controller
(Chief Accounting Officer and Duly
Authorized Officer of Registrant)
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<TABLE>
<CAPTION>
EXHIBIT 11
-----------
COMPUTATION OF PER SHARE EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Quarter Ended Two Quarters Ended
------------------- -------------------
June 26 June 27 June 26 June 27
1994 1993 1994 1993
------- ------- ------- -------
<S> <C> <C> <C> <C>
PRIMARY
Average shares outstanding 54,133 55,020 54,443 55,061
Net effect of dilutive
stock options - based on
the Treasury Stock method
using the average market
price 415 456 447 550
------- ------- ------- -------
TOTAL 54,548 55,476 54,890 55,611
======= ======= ======= =======
Net Income $50,121 $42,497 $80,493 $65,633
======= ======= ======= =======
Per Share amount
from net income $0.92 $0.77 $1.47 $1.18
======= ======= ======= =======
FULLY DILUTED
Average shares outstanding 54,133 55,020 54,443 55,061
Net effect of dilutive
options - based on the Treasury
Stock method using the higher
of quarter-end or average
market price 371 454 472 549
------- ------- ------- -------
TOTAL 54,504 55,474 54,915 55,610
======= ======= ======= =======
Net Income $50,121 $42,497 $80,493 $65,633
======= ======= ======= =======
Per Share amount
from net income $0.92 $0.77 $1.47 $1.18
======= ======= ======= =======
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</TABLE>
<TABLE>
<CAPTION>
KNIGHT-RIDDER, INC. AND SUBSIDIARIES EXHIBIT 28
BUSINESS SEGMENT INFORMATION ----------
(Unaudited, in thousands of dollars)
Quarter Ended Two Quarters Ended Four Quarters Ended
----------------------- ---------------------- ----------------------
June 26 June 27 June 26 June 27 June 26 June 27
1994 1993 1994 1993 1994 1993
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
OPERATING REVENUE
Newspapers $ 534,130 $ 510,682 $1,036,000 $ 988,500 $2,060,323 $1,978,645
Business Information Services 127,420 111,000 256,413 217,076 477,862 410,491
--------- --------- --------- --------- --------- ---------
$ 661,550 $ 621,682 $1,292,413 $1,205,576 $2,538,185 $2,389,136
========= ========= ========= ========= ========= =========
OPERATING INCOME
Newspapers $ 101,995 $ 82,658 $ 170,081 $ 139,186 $ 329,662 $ 294,667
Business Information Services 5,032 4,097 12,569 9,713 26,261 21,989
Corporate (11,741) (10,510) (22,554) (18,974) (40,895) (37,629)
--------- --------- --------- --------- --------- ---------
$ 95,286 $ 76,245 $ 160,096 $ 129,925 $ 315,028 $ 279,027
========= ========= ========= ========= ========= =========
DEPRECIATION AND AMORTIZATION
Newspapers $ 23,747 $ 24,410 $ 47,688 $ 47,354 $ 94,935 $ 91,086
Business Information Services 12,995 11,557 25,777 22,098 49,204 41,212
Corporate 473 397 896 796 1,732 1,573
--------- --------- --------- --------- --------- ---------
$ 37,215 $ 36,364 $ 74,361 $ 70,248 $ 145,871 $ 133,871
========= ========= ========= ========= ========= =========
</TABLE>
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<TABLE>
<CAPTION>
KNIGHT-RIDDER, INC
SECOND QUARTER GRAPHS
SECOND QUARTER NET INCOME SECOND QUARTER TOTAL OPERATING REVENUE
(From continuing operations, In $000s) (From continuing operations, In $000s)
<C> <C> <C> <C>
Year Amount Year Amount
---- ------ ---- -------
1994 50,121 1994 661,550
1993 42,497 1993 621,682
1992 46,090 1992 590,531
1991 41,573 1991 569,497
1990 44,609 1990 591,739
1989 40,201 * 1989 578,700
SECOND QUARTER EARNINGS PER SHARE SECOND QUARTER NEWSPAPER ADVERTISING REVENUE
(From continuing operations) (In $000s)
<C> <C> <C> <C>
Year Amount Year Amount
---- ------ ---- -------
1994 $0.92 1994 395,964
1993 $0.77 1993 377,483
1992 $0.84 1992 370,252
1991 $0.82 1991 369,030
1990 $0.88 1990 405,641
1989 $0.77 * 1989 406,974
* Excludes $29,891,000, or $.58 per share, after-tax gain on the sale of the Pasadena newspaper.
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</TABLE>
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<TABLE>
<CAPTION>
Circulation - Note A Quarter Ended Two Quarters Ended
--------------------------------- ---------------------------------
(Unaudited, in thousands of copies) June 26 June 27 June 26 June 27
1994 1993 Change 1994 1993 Change
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Average Morning Circulation 3,155 3,198 (43) 3,176 3,219 (43)
Average Evening Circulation 450 466 (16) 450 465 (15)
-------- -------- -------- -------- -------- --------
Average Daily Circulation 3,605 3,664 (59) 3,626 3,684 (58)
======== ======== ======== ======== ======== ========
Average Sunday Circulation 4,701 4,747 (46) 4,745 4,782 (37)
======== ======== ======== ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Advertising Statistics - Notes A & B Quarter Ended Two Quarters Ended
--------------------------------- ---------------------------------
June 26 June 27 June 26 June 27
1994 1993 % Change 1994 1993 % Change
-------- -------- -------- -------- -------- --------
<S>
LINAGE (Unaudited, in thousands of <C> <C> <C> <C> <C> <C>
six-column inches)
Full-run ROP
Retail 3,809 3,858 (1.3) 7,287 7,386 (1.3)
General 395 382 3.4 768 713 7.8
Classified 3,590 3,392 5.8 6,864 6,531 5.1
--------- --------- --------- ---------
Total 7,794 7,632 2.1 14,919 14,630 2.0
========= ========= ========= =========
Factored Part-run ROP 447 488 (8.5) 848 935 (9.3)
========= ========= ========= =========
Full-run Preprint 4,163 4,212 (1.2) 7,854 7,726 1.7
========= ========= ========= =========
Part-run Preprint 4,328 3,892 11.2 7,682 7,233 6.2
========= ========= ========= =========
TOTAL PREPRINTS INSERTED (000s) 1,143,167 1,141,103 0.2 2,232,567 2,163,660 3.2
========= ========= ========= =========
Note A: Where necessary, certain previously reported statistics have been restated to be consistent with
measurement guidelines currently in use.
Note B: Factored part-run linage represents linage in zoned editions that is translated into full-run
equivalent linage based on the ratio of the circulation in a particular zone to the total
circulation of the newspaper.
</TABLE>
-18-
<PAGE>
<TABLE>
<CAPTION>
Knight-Ridder Share Trading
(As quoted by Knight-Ridder Financial Services)
1994 Second Quarter 1993 Second Quarter
-------------------------------- ------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C>
Volume High Low Close Volume High Low Close
--------- ------ ----- ----- --------- ------ ------ ------
7,003,400 60 1/4 52 52 6,755,900 58 3/4 51 1/8 52 1/8
</TABLE>
-19-
