<PAGE> 1
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):
July 13, 1999
THE ACKERLEY GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
1-10321 91-1043807
------------------------ -------------------------------
(Commission File Number) IRS Employer Identification No.
1301 Fifth Avenue, Suite 4000
Seattle, Washington 98101
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (206) 624-2888
<PAGE> 2
ITEM 5. OTHER EVENTS
On July 13, 1999, The Ackerley Group, Inc. announced net revenue for
the quarter ended June 30, 1999 was $71.4 million compared to $75.8 million
for the second quarter of 1998. On a "same stores" basis, net revenue for the
quarter ended June 30, 1999 was $64.1 million compared to $64.8 million for the
same period in 1998. The "same stores" basis excludes (1) our airport
advertising operations, which we sold in June 1998, (2) television stations
WOKR, KVIQ, KMTR and KCOY, which we acquired in 1999, and (3) television
station KKTV, which we sold in 1999.
"Same stores" net revenue for the second quarter of 1999 was
$25.7 million for the Outdoor Media segment, an increase of 4% from the
comparable period in the prior year. "Same stores" net revenue for the
Television Broadcasting segment for the second quarter of 1999 decreased 3% from
the second quarter of 1998 to $14.1 million due primarily to the lack of
political advertising revenue in 1999. Net revenue in our Radio Broadcasting
segment for the second quarter of 1999 increased 8% from the second quarter of
1998 to $6.9 million, while net revenue in our Sports & Entertainment segment
for the second quarter of 1999 decreased 9% from the second quarter of 1998 to
$17.3 million due primarily to the effects of the NBA lock-out.
Operating Cash Flow for the quarter ended June 30, 1999 was $13.5
million compared to $13.9 million for the second quarter of 1998. On a "same
stores" basis, Operating Cash Flow was $12.0 million for the second quarter of
1999 compared to $12.4 million for the second quarter of 1998. We define
Operating Cash Flow as net revenue less operating expenses before amortization,
depreciation, interest, litigation, and stock compensation expenses and gain on
disposition of assets.
"Same stores" Operating Cash Flow for the Outdoor Media segment
for the second quarter of 1999 decreased 3% from the second quarter of 1998 to
$11.7 million due primarily to the loss of tobacco advertising revenue and
expenses related to our increased national sales efforts. "Same stores"
Operating Cash Flow for the Television Broadcasting segment decreased from $2.4
million in the second quarter of 1998 to $1.3 million in the second quarter of
1999 due primarily to a restructuring charge taken in the second quarter of 1999
in connection with our ongoing implementation of Digital CentralCasting. This
restructuring charge consisted primarily of costs associated with employee staff
reductions. Operating Cash Flow for the Radio Broadcasting segment was $3.0
million for the second quarter of 1999, an increase of 6% from the second
quarter of 1998, while Operating Cash Flow for the Sports & Entertainment
segment for the second quarter of 1999 was negative $0.2 million, unchanged from
the comparable period in the prior year. Second quarter 1999 Operating Cash Flow
for our Sports & Entertainment segment was adversely affected by reduced
revenues (after expenses) from the failure of the Seattle SuperSonics to
participate in the 1999 NBA playoffs (in contrast to the prior season, when they
participated in the first two rounds of the 1998 NBA playoffs) and lower than
anticipated revenues from NBA related activities due primarily to the NBA
lock-out, offset, in part, by additional revenue (after expenses) generated by
the extension of the NBA's 1998-99 regular season into the second quarter of
1999 to make up for some of the games
2
<PAGE> 3
cancelled as a result of the lock-out. Corporate overhead decreased from $4.6
million in the second quarter of 1998 to $3.8 million in the second quarter of
1999.
Net income for the second quarter of 1999 was $22.2 million
compared to $22.4 million for the second quarter of 1998. This includes pre-tax
gains on dispositions of assets of $27.3 in the second quarter of 1999 and $33.0
million in the second quarter of 1998, resulting primarily from the sale of
television station KKTV in 1999 and the sale of our airport advertising
operations in 1998.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial statements.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
(99) Press release dated July 13, 1999.
3
<PAGE> 4
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.
Dated: July 13, 1999
THE ACKERLEY GROUP, INC.
By: /s/ Keith W. Ritzmann
_________________________________
Keith W. Ritzmann
Senior Vice President and Chief
Information Officer, Assistant
Secretary and Controller
4
<PAGE> 1
EXHIBIT 99
FROM: THE ACKERLEY GROUP, INC.
Tel: (206) 624-2888
Analyst Contact: Dan Evans, Jr., Vice President Public Affairs
Denis Curley, Co-President and Chief Financial Officer
Leon Berman, The MWW Group, 1-800-724-7602
Media Contact: Rosanne Marks, MWW/Savitt, (206) 587-7734
THE ACKERLEY GROUP REPORTS SECOND QUARTER
SEATTLE, July 13, 1999 -- The Ackerley Group (NYSE: AK), a leading media
and entertainment company, announced today net revenue for the quarter ended
June 30, 1999 was $71.4 million compared to $75.8 million for the second quarter
of 1998. On a "same stores" basis, net revenue for the quarter ended June 30,
1999 was $64.1 million compared to $64.8 million for the same period in 1998.
The "same stores" basis excludes (1) our airport advertising operations, which
we sold in June 1998, (2) television stations WOKR, KVIQ, KMTR and KCOY, which
we acquired in 1999, and (3) television station KKTV, which we sold in 1999.
"Same stores" net revenue for the second quarter of 1999 was $25.7
million for the Outdoor Media segment, an increase of 4% from the comparable
period in the prior year. "Same stores" net revenue for the Television
Broadcasting segment for the second quarter of 1999 decreased 3% from the second
quarter of 1998 to $14.1 million due primarily to the lack of political
advertising revenue in 1999. Net revenue in our Radio Broadcasting segment for
the second quarter of 1999 increased 8% from the second quarter of 1998 to $6.9
million, while net revenue in our Sports & Entertainment segment for the second
quarter of 1999 decreased 9% from the second quarter of 1998 to $17.3 million
due primarily to the effects of the NBA lock-out.
Operating Cash Flow for the quarter ended June 30, 1999 was $13.5
million compared to $13.9 million for the second quarter of 1998. On a "same
stores" basis, Operating Cash Flow was $12.0 million for the second quarter of
1999 compared to $12.4 million for the second quarter of 1998. We define
Operating Cash Flow as net revenue less operating expenses before amortization,
depreciation, interest, litigation, and stock compensation expenses and gain on
disposition of assets.
<PAGE> 2
"Same stores" Operating Cash Flow for the Outdoor Media segment for the
second quarter of 1999 decreased 3% from the second quarter of 1998 to $11.7
million due primarily to the loss of tobacco advertising revenue and expenses
related to our increased national sales efforts. "Same stores" Operating Cash
Flow for the Television Broadcasting segment decreased from $2.4 million in the
second quarter of 1998 to $1.3 million in the second quarter of 1999 due
primarily to a restructuring charge taken in the second quarter of 1999 in
connection with our ongoing implementation of Digital CentralCasting. This
restructuring charge consisted primarily of costs associated with employee staff
reductions. Operating Cash Flow for the Radio Broadcasting segment was $3.0
million for the second quarter of 1999, an increase of 6% from the second
quarter of 1998, while Operating Cash Flow for the Sports & Entertainment
segment for the second quarter of 1999 was negative $0.2 million, unchanged from
the comparable period in the prior year. Second quarter 1999 Operating Cash Flow
for our Sports & Entertainment segment was adversely affected by reduced
revenues (after expenses) from the failure of the Seattle SuperSonics to
participate in the 1999 NBA playoffs (in contrast to the prior season, when they
participated in the first two rounds of the 1998 NBA playoffs) and lower than
anticipated revenues from NBA related activities due primarily to the NBA
lock-out, offset, in part, by additional revenue (after expenses) generated by
the extension of the NBA's 1998-99 regular season into the second quarter of
1999 to make up for some of the games cancelled as a result of the lock-out.
Corporate overhead decreased from $4.6 million in the second quarter of 1998 to
$3.8 million in the second quarter of 1999.
Net income for the second quarter of 1999 was $22.2 million compared to
$22.4 million for the second quarter of 1998. This includes pre-tax gains on
dispositions of assets of $27.3 in the second quarter of 1999 and $33.0 million
in the second quarter of 1998, resulting primarily from the sale of television
station KKTV in 1999 and the sale of our airport advertising operations in 1998.
The Ackerley Group is comprised of four operating segments, which contain a
total of 22 independent media and entertainment operations. The Outdoor Media
segment includes outdoor advertising in four major metropolitan markets. The
Television Broadcasting segment owns, operates under management agreements, or
has applications pending with the FCC for 13
6
<PAGE> 3
stations in California, New York, Washington, Oregon and Alaska. The Radio
Broadcasting segment owns and operates four radio stations in the Seattle-Tacoma
market. The Sports & Entertainment segment includes Full House Sports &
Entertainment, and the NBA's Seattle SuperSonics.
Certain statements in this report set forth management's intentions, plans,
beliefs, expectations or predictions of the future based on current facts and
analyses. Actual results may differ materially from those indicated in such
statements. Additional information on factors that may affect the business and
financial results of the Company can be found in filings of the Company with the
Securities and Exchange Commission.
7
