<PAGE> 1
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 QUARTER ENDED: March 31, 1996
--------------
COMMISSION FILE NUMBER: 1-7553
------
KNIGHT-RIDDER, INC.
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(Exact name of registrant as specified in its charter)
FLORIDA 38-0723657
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(State of Incorporation) (I.R.S. Employer Identification No.)
ONE HERALD PLAZA, MIAMI, FLORIDA 33132
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(Address of principal executive offices)
(305) 376-3800
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Registrant's telephone number, including area code)
NOT APPLICABLE
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(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 - 48,911,350 shares as of May 5, 1996.
-1-
<PAGE> 2
Table of Contents for Form 10-Q
Page
----
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Statement of Income 3
Consolidated Balance Sheet 4
Consolidated Statement of Cash Flows 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 9
Item 4. Submission of Matters to a Vote of Security Holders 9-10
Item 6. Exhibits and Reports on Form 8-K 10
SIGNATURE 10
Exhibit 27 Financial Data Schedule 11
Exhibit 99 Additional Exhibits 12
-2-
<PAGE> 3
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED, IN THOUSANDS OF DOLLARS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
QUARTER ENDED FOUR QUARTERS ENDED
---------------------- -------------------------
MARCH 31 MARCH 26 MARCH 31 MARCH 26
1996 1995 1996 1995
--------- --------- ---------- ----------
<S> <C> <C> <C> <C>
OPERATING REVENUE
Newspapers
Advertising
Retail ............................................... $ 182,051 $ 181,785 $ 808,024 $ 800,235
General .............................................. 46,236 47,371 181,381 184,759
Classified ........................................... 195,566 167,099 711,163 628,115
--------- --------- ---------- ----------
Total .............................................. 423,853 396,255 1,700,568 1,613,109
Circulation ............................................ 126,854 122,592 499,577 486,449
Other .................................................. 20,049 18,286 83,660 70,627
--------- --------- ---------- ----------
Total Newspapers ................................... 570,756 537,133 2,283,805 2,170,185
Business Information Services ............................ 126,905 137,466 491,091 522,512
--------- --------- ---------- ----------
Total Operating Revenue ............................ 697,661 674,599 2,774,896 2,692,697
--------- --------- ---------- ----------
OPERATING COSTS
Labor and employee benefits .............................. 283,315 279,594 1,131,700 1,100,616
Newsprint, ink and supplements ........................... 126,520 94,829 478,532 351,337
Other operating costs .................................... 194,337 191,557 787,898 753,493
Depreciation and amortization ............................ 42,877 37,612 156,877 149,793
--------- --------- ---------- ----------
Total Operating Costs .............................. 647,049 603,592 2,555,007 2,355,239
--------- --------- ---------- ----------
OPERATING INCOME ........................................... 50,612 71,007 219,889 337,458
--------- --------- ---------- ----------
OTHER INCOME (EXPENSE)
Interest expense ......................................... (19,627) (12,401) (66,798) (46,464)
Interest expense capitalized ............................. 1,195 245 2,839 663
Interest income .......................................... 2,581 2,133 9,590 6,938
Equity in earnings of unconsolidated companies
and joint ventures ..................................... 7,755 951 27,465 10,485
Minority interests in earnings of
consolidated subsidiaries .............................. (1,583) (1,614) (8,317) (9,037)
Other, net ............................................... (97) 1,326 82,317 12
--------- --------- ---------- ----------
Total .............................................. (9,776) (9,360) 47,096 (37,403)
--------- --------- ---------- ----------
Income before income taxes ............................... 40,836 61,647 266,985 300,055
Income taxes ............................................. 17,318 25,974 111,758 123,854
--------- --------- ---------- ----------
INCOME BEFORE CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING PRINCIPLE ........................... 23,518 35,673 155,227 176,201
Cumulative effect of change in accounting principle
for contributions ...................................... (7,320) (7,320)
--------- --------- ---------- ----------
Net income ........................................... $ 23,518 $ 28,353 $ 155,227 $ 168,881
========= ========= ========== ==========
EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE
Income before cumulative effect of
change in accounting principle ......................... $ 0.48 $ .69 $ 3.14 $ 3.30
Cumulative effect of change in accounting principle ...... (0.14) (0.14)
--------- --------- ---------- ----------
Net income ............................................. $ 0.48 $ 0.55 $ 3.14 $ 3.16
========= ========= ========== ==========
DIVIDENDS DECLARED PER COMMON SHARE ........................ $ 0.37 $ 0.37 $ 1.48 $ 1.48
========= ========= ========== ==========
AVERAGE COMMON AND COMMON EQUIVALENT
SHARES OUTSTANDING (OOOS) .................................. 49,473 51,883 49,496 53,438
========= ========= ========== ==========
</TABLE>
SEE "NOTES TO CONSOLIDATED FINANCIAL STATEMENTS" ON PAGE 6.
- 3 -
<PAGE> 4
CONSOLIDATED BALANCE SHEET
(UNAUDITED, IN THOUSANDS OF DOLLARS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
March 31 December 31 March 26
1996 1995 1995
---------- ---------- ----------
<S> <C> <C> <C>
ASSETS
- ------
CURRENT ASSETS
Cash, including short-term cash investments of $50 in
1996, $50 in December 1995, and $1,887 in March 1995 ................... $ 39,075 $ 26,012 $ 16,259
Accounts receivable, net of allowances of $14,841 in
1996, $14,348 in December 1995 and $14,100 in March 1995 ............... 349,136 339,264 306,088
Inventories .............................................................. 93,543 73,349 48,354
Other current assets ..................................................... 61,775 64,297 95,208
---------- ---------- ----------
Total Current Assets ............................................... 543,529 502,922 465,909
---------- ---------- ----------
INVESTMENTS AND OTHER ASSETS
Equity in unconsolidated companies and joint ventures .................... 324,342 321,658 294,218
Other .................................................................... 258,637 285,666 199,447
---------- ---------- ----------
Total Investments and Other Assets ................................. 582,979 607,324 493,665
---------- ---------- ----------
PROPERTY, PLANT AND EQUIPMENT
Land and improvements .................................................... 80,566 80,616 67,016
Buildings and improvements ............................................... 405,009 401,093 383,969
Equipment ................................................................ 1,223,586 1,223,838 1,209,124
Construction and equipment installations in progress ..................... 84,629 57,644 23,666
---------- ---------- ----------
1,793,790 1,763,191 1,683,775
Less accumulated depreciation ............................................ 845,109 831,544 858,436
---------- ---------- ----------
Net Property, Plant and Equipment .................................... 948,681 931,647 825,339
---------- ---------- ----------
EXCESS OF COST OVER NET ASSETS ACQUIRED
Less accumulated amortization of $213,261 in 1996,
$205,608 in December 1995 and $187,989 in March 1995 ................... 947,475 963,817 702,725
---------- ---------- ----------
Total .............................................................. $3,022,664 $3,005,710 $2,487,638
========== ========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
CURRENT LIABILITIES
Accounts payable ......................................................... $ 119,057 $ 127,532 $ 138,430
Accrued expenses and other liabilities ................................... 100,788 105,317 96,581
Accrued compensation and amounts withheld from employees ................. 82,327 101,357 83,233
Federal and state income taxes ........................................... 195 22,703
Deferred revenue ......................................................... 72,856 72,134 68,450
Dividends payable ........................................................ 18,155 17,978 18,573
Short-term borrowings and current portion of long-term debt .............. 51,366 13,129
---------- ---------- ----------
Total Current Liabilities .......................................... 444,549 437,642 427,970
---------- ---------- ----------
NONCURRENT LIABILITIES
Long-term debt ........................................................... 1,002,806 1,000,721 565,566
Deferred federal and state income taxes .................................. 152,920 165,045 138,611
Postretirement benefits other than pensions .............................. 170,427 169,672 167,192
Employment benefits and other noncurrent liabilities ..................... 125,590 120,817 98,111
---------- ---------- ----------
Total Noncurrent Liabilities ....................................... 1,451,743 1,456,255 969,480
---------- ---------- ----------
MINORITY INTERESTS IN CONSOLIDATED SUBSIDIARIES ............................ 625 843 205
---------- ---------- ----------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Common stock, $.02 1/12 par value; shares authorized -
250,000,000; shares issued - 49,078,693 in 1996,
48,598,154 in December 1995 and 50,218,141 in March 1995 ............... 1,022 1,012 1,046
Additional capital ....................................................... 327,214 295,360 309,040
Retained earnings ........................................................ 771,323 771,656 779,897
Unrealized gains on investments .......................................... 26,188 42,942
---------- ---------- ----------
Total Shareholders' Equity ......................................... 1,125,747 1,110,970 1,089,983
---------- ---------- ----------
Total .............................................................. $3,022,664 $3,005,710 $2,487,638
========== ========== ==========
</TABLE>
See "Notes to Consolidated Financial Statements" on page 6.
-4-
<PAGE> 5
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED, IN THOUSANDS OF DOLLARS)
<TABLE>
<CAPTION>
QUARTER ENDED FOUR QUARTERS ENDED
------------------- --------------------
MARCH 31 MARCH 26 MARCH 31 MARCH 26
1996 1995 1996 1995
-------- -------- --------- --------
<S> <C> <C> <C> <C>
CASH PROVIDED BY (REQUIRED FOR) OPERATING ACTIVITIES
Net income............................................................... $ 23,518 $ 28,353 $ 155,227 $ 168,881
Noncash items included in income:
Cumulative effect of change in accounting principle..................... 7,320 7,320
Depreciation............................................................ 28,695 26,555 106,926 105,707
Amortization of excess of cost over net assets acquired................. 7,653 5,587 25,774 22,078
Amortization of other assets............................................ 6,529 5,470 24,177 22,008
Provision for noncurrent deferred taxes................................. 5 4,509 (1,153)
Earnings of investees in excess of distributions........................ (4,051) 588 (15,467) (10,014)
Distributions to investees.............................................. (5,422)
Gain on sale of subsidiary.............................................. (92,698)
Other items, net........................................................ 6,436 9,517 42,883 44,979
Change in certain assets and liabilities:
Accounts receivable..................................................... 2,707 11,644 (27,557) (31,921)
Inventories............................................................. (19,928) (8,799) (43,421) (10,312)
Other current assets.................................................... 5,132 (40,438) 36,039 (26,670)
Accounts payable........................................................ (8,475) 1,613 (29,323) 15,172
Federal and state income taxes.......................................... (195) 21,335 (37,675) 14,680
Other current liabilities............................................... (23,199) (18,559) (1,634) 15,588
-------- -------- --------- --------
Net cash provided by operating activities........................... 24,827 50,186 142,338 336,343
-------- -------- --------- --------
CASH PROVIDED BY(REQUIRED FOR) INVESTING ACTIVITIES
Acquisition of Contra Costa Newspapers, Inc.............................. (335,755)
Additions to property, plant and equipment............................... (44,511) (17,951) (147,585) (70,889)
Other items, net......................................................... (9,517) (8,839) 46,725 (35,546)
-------- -------- --------- --------
Net cash required for investing activities.......................... (54,028) (26,790) (436,615) (106,435)
-------- -------- --------- --------
CASH PROVIDED BY (REQUIRED FOR) FINANCING ACTIVITIES
Proceeds from sale of commercial paper and senior notes payable.......... 162,539 222,256 1,032,903 466,606
Reduction of total debt.................................................. (122,215) (68,194) (544,295) (357,730)
-------- -------- --------- --------
Net change in total debt............................................ 40,324 154,062 488,608 108,876
Payment of cash dividends................................................ (17,978) (19,593) (72,762) (78,338)
Sale of common stock to employees........................................ 33,235 7,780 100,892 24,495
Purchase of treasury stock............................................... (7,067) (152,231) (174,199) (264,086)
Other items, net......................................................... (6,250) (6,408) (25,446) (24,821)
-------- -------- --------- --------
Net cash provided by (required for) financing activities............ 42,264 (16,390) 317,093 (233,874)
-------- -------- --------- --------
Net Increase (Decrease) in Cash..................................... 13,063 7,006 22,816 (3,966)
Cash and short-term cash investments at beginning of the period........... 26,012 9,253 16,259 20,225
-------- -------- --------- --------
Cash and short-term cash investments at end of the period................. $ 39,075 $ 16,259 $ 39,075 $ 16,259
======== ======== ========= ========
Working capital at end of the period...................................... $ 98,980 $ 37,939 $ 98,980 $ 37,939
======== ======== ========= ========
</TABLE>
SEE "NOTES TO CONSOLIDATED FINANCIAL STATEMENTS" ON PAGE 6.
- 5 -
<PAGE> 6
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for
a fair presentation have been included. Operating results for the three month
period and four quarters ended March 31, 1996 are not necessarily indicative of
the results that may be expected for the year ending December 29, 1996. For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Registrant Company and Subsidiaries' annual
report on Form 10-K for the year ended December 31, 1995.
<TABLE>
<CAPTION>
NOTE 2 - DEBT
(In thousands of dollars) EFFECTIVE
INTEREST BALANCE AT
RATE AT ---------------------------------
MARCH 31 MARCH 31 DECEMBER 31 MARCH 26
1996 1996 1995 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Commercial paper, net of discount...... 5.5% $ 597,990 $ 557,698 $208,745
Notes payable, net of discount (a)..... 8.5 159,316 159,274 159,146
Debentures, net of discount (b)........ 10.0 197,826 197,789 197,675
Senior notes, net of discount (c)...... 6.4 99,040 99,089
---------- ---------- --------
Total debt (d)............... 6.9 1,054,172 1,013,850 565,566
Less amounts classified as current..... 5.5 51,366 13,129
---------- ---------- --------
Total long-term debt......... 7.0% $1,002,806 $1,000,721 $565,566
========== ========== ========
</TABLE>
(a) REPRESENTS $160 MILLION OF 8 1/2% NOTES SUBJECT TO MANDATORY PRO RATA
AMORTIZATION OF 25% ANNUALLY COMMENCING 1998 THROUGH MATURITY IN 2001.
(b) REPRESENTS $200 MILLION OF 20-YEAR 9 7/8% DEBENTURES DUE IN 2009.
(c) REPRESENTS $100 MILLION OF 10-YEAR 6.3% SENIOR NOTES DUE IN 2005.
(d) AT MARCH 31, 1996, AND MARCH 26, 1995, INTEREST PAYMENTS OF $14.3 MILLION
AND $9.1 MILLION HAD BEEN MADE FOR THE YEAR-TO-DATE, RESPECTIVELY.
NOTE 3 - INCOME TAX PAYMENTS
Income tax payments for the quarters ended March 31, 1996, and March 26, 1995,
were $3.7 million and $3.6 million, respectively.
-6-
<PAGE> 7
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FIRST QUARTER
FIRST QUARTER 1996 COMPARED WITH FIRST QUARTER 1995
Earnings per share for the first quarter of 1996 were $.48, down $.21 per
share, or 30.4%, from the $.69 per share earned in 1995, prior to the
cumulative effect of a change in accounting principle recorded in the first
quarter last year. The $.21 per share decline principally reflects: a 46.0%
increase in the price of newsprint from the first quarter of 1995; operating
losses incurred as a result of the Detroit strike ($.14 per share decline from
the prior year); and lower Business Information Services (BIS) operating
profit due to the launch by Knight-Ridder Information, Inc. (KRII) of two
important new products aimed at the end-user market, and the absence of the
Journal of Commerce (JoC), which was sold on April 3, 1995.
Operating Revenue
Newspaper advertising revenue increased 7.0% over the first quarter last
year, on a full-run ROP linage increase of 10.9%. Excluding Detroit, but
including the operations of Contra Costa Newspapers (acquired from Lesher
Communications on Oct. 31, 1995) as if it had been owned both quarters,
newspaper advertising revenue increased 5.5% from 1995 on a full-run ROP
linage decrease of 0.6%.
Classified advertising revenue increased 17.0% over the first quarter
last year on a 16.5% full-run ROP linage increase. This is the 15th
consecutive quarter of year-over-year classified revenue growth. The
employment category showed the largest gain, posting a 30.7% revenue
improvement, with linage up 9.9% from 1995. On a pro forma basis for Contra
Costa Newspapers (CCN), but excluding Detroit, classified advertising
revenue increased 15.8% from 1995.
Retail advertising revenue improved by $266,000 over last year. On a pro
forma basis for CCN, but excluding Detroit, retail revenue was down 2.0% from
the prior year. Retail results in January were impacted by the inclement
weather in the Northeast, but rebounded to an increase of 3.7% in March.
General advertising revenue was down $1.1 million, or 2.4%, from last
year. On a pro forma basis for CCN, but excluding Detroit, general advertising
revenue was down $1.3 million, or 2.9%, from 1995. General advertising
revenue was soft during most of the quarter, with March reflecting the
strongest growth, up 1.1% from the prior year.
Circulation revenue increased $4.3 million, or 3.5% from first quarter
1995. On a pro forma basis for CCN, but excluding Detroit, circulation
revenue increased by $3.8 million, or 3.4%, on an average daily circulation
decrease of 3.7% and average Sunday circulation decrease of 2.4%. The decline
in circulation was offset by a 7.0% increase in the average rate, excluding
both Detroit and CCN. Other newspaper revenue increased by $1.8 million, or
9.6%, from the prior year, due mostly to the contribution of CCN.
BIS revenue in the first quarter decreased $10.6 million, or 7.7%, due to
the absence of the JoC, which was sold on April 3, 1995. Excluding the JoC and
acquisitions, operating revenue was up 0.7% from last year.
Operating Costs
Labor and employee benefit costs rose $3.7 million, or 1.3%, on a 1.4%
decrease in the work force. The work force decrease, despite the CCN
acquisition, was the result of fourth quarter buyouts in a number of
locations, including Miami, Philadelphia and San Jose, as well as the impact
of the Detroit strike and the absence of the JoC. Excluding the impact of
acquisitions and dispositions, the work force decreased by 5.2%. Labor and
employee benefits per employee, excluding Detroit, CCN and JoC, increased
4.3.% from first quarter 1995.
Newsprint, ink and supplements costs increased $31.7 million, or 33.4%,
on a 4.5% decrease in newsprint consumption and a 46.0% increase in the
average newsprint price. Though there were no price increases in the first
quarter of 1996, the quarter was significantly impacted by the newsprint price
increases imposed in 1995.
Other operating costs rose $2.8 million, or 1.5%, over first quarter
1995. On a pro forma basis for CCN, but excluding Detroit, other operating
costs were $7.5 million, or 4.1%, below 1995, due to tight cost controls
implemented to offset softness in advertising revenue.
Depreciation and amortization increased $5.3 million, or 14.0% over
first quarter 1995 primarily due to the acquisition of CCN. Excluding the
impact of acquisitions, depreciation and amortization increased by 3.0 % from
1995, primarily due to BIS capital investments.
-7-
<PAGE> 8
Non-Operating Items
Interest expense, net of interest income and interest expense
capitalized, increased $5.8 million over last year due to higher debt levels
during the quarter. The average debt balance for the quarter increased $514.1
million from the first quarter of last year, due largely to the financing of
the CCN acquisition and the 5.8 million shares repurchased in 1995.
Equity in earnings of unconsolidated companies and joint ventures
increased by $6.8 million due to earnings improvements from our newsprint mill
investments, which are benefiting from the rise in newsprint prices over first
quarter last year.
Other
On April 1, 1996, the company announced that a libel suit filed by
Richard A. Sprague against The Philadelphia Inquirer in 1973 had been settled.
The settlement will have no impact on earnings.
In March, the company announced that Tele-Communications, Inc. (TCI) has
agreed to purchase all of Knight-Ridder's interests in the jointly owned cable
properties for a price of $420 million in cash and TCI common stock. The two
companies are equal owners of TKR Cable Company, which owns and operates
systems in New Jersey and New York. Knight-Ridder also has a 15% interest in
another TCI Cable venture that operates cable systems in five Southern states.
The sale is expected to close in the second half of this year.
On May 7, we announced that Global Financial Information Corporation
(GFI), a major investment of Welsh, Carson, Anderson & Stowe, will purchase
Knight-Ridder Financial for $275 million. The sale is expected to close in the
third quarter.
During the first quarter of 1996, the company purchased approximately
100,000 shares of Knight-Ridder common stock. The company has remaining
authorization to repurchase 2.9 million shares and plans to repurchase
additional shares this year. A portion of the proceeds from the sale of both
our cable investment and KRF will be used to repurchase stock.
Liquidity
Net cash provided by operating activities decreased to $24.8 million from
$50.2 million in the first quarter of 1995. The decrease was attributed to
lower earnings, as a result of higher newsprint prices in the first quarter of
1996 and the Detroit strike, as well as changes in several working capital
components. Cash and short-term cash investments were up $22.8 million from
March 26, 1995, and up $13.1 million from year end. Total debt increased
$40.3 million during the quarter and increased $488.6 million from March 26,
1995, due to the CCN acquisition and the 5.8 million shares repurchased in
1995.
The total-debt-to-total-capital ratio was 48.4%, up from 47.7% at year
end and 34.2% in March 1995. Management intends to use some portion of the
proceeds from the sale of our cable investment and KRF to reduce debt before
year end. Approximately $198 million in aggregate unused credit lines
remained at the end of the quarter. The ratio of current assets to current
liabilities was 1.2:1 at March 31, 1996, and 1.1:1 at Dec. 31, 1995, and March
26, 1995.
Outlook for the Remainder of the Year
We were pleased by results for the first quarter of the year. As we look
ahead to the second quarter and the year, we believe the advertising strength
we have seen thus far will be sustained and we expect 1996 to be a year of
earnings growth. We expect no newsprint price increase this year, and we are
encouraged that there are some signs of softening in the prices. For the full
year, we expect newsprint costs will be held to a level about 20%-25% above
what was paid in 1995.
BIS Division results are expected to improve later in the year, but will
be down slightly from the prior year due to reinvestment in product
development.
Operating profit and EPS are expected to improve throughout the year, with
the greatest improvement expected in the second half of the year. Detroit is
expected to continue to improve their operating results, and we now believe
our total operating losses will be around $20 million. Comparisons to the
prior year are expected to be better in the second half of the year due to
more favorable newsprint price comparisons, the improvements in Detroit's
operating results as the impact of its strike lessens, and the severance costs
recognized in the fourth quarter of last year.
-8-
<PAGE> 9
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
Refer to Part I, Item 2, incorporated herein by reference, for a discussion
relating to the settlement of litigation.
Item 4. Submission of Matters to a Vote of Security Holders
(a) The Company's Annual Meeting of Shareholders was held on April 23, 1996.
The results of the voting with respect to matters presented at the Annual
Meeting were as follows:
<TABLE>
Common Stock Voted
---------------------------------
For Against Withheld
------ --------- -----------
<S> <C> <C> <C>
(b) Election of Directors
For a three-year term ending 1999:
James I. Cash, Jr. 41,614,498 0 832,638
Jesse Hill, Jr. 41,613,839 0 833,297
Thomas L. Phillips 41,615,064 0 832,072
P. Anthony Ridder 41,611,857 0 835,279
Randall L. Tobias 41,617,060 0 830,076
For a two-year term ending 1998:
Joan Ridder Challinor 41,615,164 0 831,972
John C. Fontaine 41,617,137 0 829,999
Continuing Directors
Alvah H. Chapman, Jr.
Peter C. Goldmark, Jr.
Barbara Barnes Hauptfuhrer
William S. Lee
C. Peter McColough
Gonzalo F. Valdes-Fauli
John L. Weinberg
</TABLE>
(c) Ratify the appointment of Ernst & Young LLP as independent auditors of the
company for the year 1996.
<TABLE>
Common Stock Voted
---------------------------------------
For Against Abstained
-------------- --------- ------------
<S> <C> <C>
42,321,704 72,712 52,720
</TABLE>
Ratify proposal recommended by the Board of Directors to amend the
Company's Employee Stock Option Plan.
<TABLE>
Common Stock Voted
-----------------------------------------
For Against Abstained
-------------- ----------- ------------
<S> <C> <C>
41,153,505 1,164,942 128,689
</TABLE>
-9-
<PAGE> 10
Shareholder proposal seeking redemption of rights issued pursuant to the
Company's Shareholder Rights Plan (1,560,770 shares were broker non votes).
<TABLE>
Common Stock Voted
-----------------------------------------
For Against Abstained
-------------- ----------- ------------
<S> <C> <C>
15,857,514 24,612,660 416,192
</TABLE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits Filed
No. 27 - Financial Data Schedule (for SEC use only)
No. 99 - Additional Exhibits
(b) Reports on Form 8-K
No reports were filed on Form 8-K during the quarter ended March
31, 1996.
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 thereunto duly authorized.
KNIGHT-RIDDER, INC.
(Registrant)
Date: May 13, 1996 /s/ Gary R. Effren
-----------------------------------
Gary R. Effren
Vice President/Controller
(Chief Accounting Officer and Duly
Authorized Officer of Registrant)
-10-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED STATEMENT OF INCOME, THE CONSOLIDATED BALANCE SHEET, THE
CONSOLIDATED STATEMENT OF CASH FLOWS AND THE NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLAR
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-29-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<EXCHANGE-RATE> 1
<CASH> 39,075
<SECURITIES> 0
<RECEIVABLES> 363,977
<ALLOWANCES> 14,841
<INVENTORY> 93,543
<CURRENT-ASSETS> 543,529
<PP&E> 1,793,790
<DEPRECIATION> 845,109
<TOTAL-ASSETS> 3,022,664
<CURRENT-LIABILITIES> 444,549
<BONDS> 456,182
1,022
0
<COMMON> 0
<OTHER-SE> 1,124,725
<TOTAL-LIABILITY-AND-EQUITY> 3,022,664
<SALES> 697,661
<TOTAL-REVENUES> 697,661
<CGS> 126,520<F1>
<TOTAL-COSTS> 647,049
<OTHER-EXPENSES> 9,776<F2>
<LOSS-PROVISION> 5,646
<INTEREST-EXPENSE> 19,627
<INCOME-PRETAX> 40,836
<INCOME-TAX> 17,318
<INCOME-CONTINUING> 23,518
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 23,518
<EPS-PRIMARY> 0.48
<EPS-DILUTED> 0.47
<FN>
<F1>COST OF GOODS SOLD CONSISTS OF NEWSPRINT, INK & SUPPLEMENTS.
<F2>OTHER EXPENSES CONSIST OF ALL NON-OPERATING COSTS NET, EXCLUDING INCOME
TAXES. AMOUNT INCLUDES INTEREST EXPENSE, NET OF INTEREST INCOME AND OTHER
NON-OPERATING COSTS, NET OF NON-OPERATING INCOME.
-11-
</FN>
</TABLE>
<PAGE> 1
OTHER FINANCIAL INFORMATION
(Unaudited)
BUSINESS SEGMENT INFORMATION EXHIBIT 99
(In Thousands of Dollars)
<TABLE>
<CAPTION>
QUARTER ENDED FOUR QUARTERS ENDED
------------------ --------------------
MARCH 31 MARCH 26 MARCH 31 MARCH 26
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
OPERATING REVENUE
Newspapers $570,756 $537,133 $2,283,805 $2,170,185
Business Information Services 126,905 137,466 491,091 522,512
-------- -------- ---------- ----------
$697,661 $674,599 $2,774,896 $2,692,697
======== ======== ========== ==========
OPERATING INCOME
Newspapers $ 61,246 $ 77,729 $ 264,663 $ 360,499
Business Information Services 973 6,684 6,311 22,257
Corporate (11,607) (13,406) (51,085) (45,298)
-------- -------- ---------- ----------
$ 50,612 $ 71,007 $ 219,889 $ 337,458
======== ======== ========== ==========
DEPRECIATION & AMORTIZATION
Newspapers $ 28,276 $ 23,665 $ 100,662 $ 94,651
Business Information Services 13,664 13,415 53,120 53,347
Corporate 937 532 3,095 1,795
-------- -------- ---------- ----------
$ 42,877 $ 37,612 $ 156,877 $ 149,793
======== ======== ========== ==========
</TABLE>
KNIGHT-RIDDER SHARE TRADING
(As quoted by Knight-Ridder Financial Services)
<TABLE>
<CAPTION>
1996 First Quarter 1995 First Quarter
- ----------------------------------------------- --------------------------------------------------
Volume Per Day High Low Close Volume Per Day High Low Close
<S> <C> <C> <C> <C> <C> <C> <C>
161,416 72 1/8 59 3/4 68 1/8 152,485 56 1/8 50 1/4 55 7/8
</TABLE>
-12-
