JOURNAL COMMUNICATIONS INC, 10-K405, 1997-03-31

JOURNAL COMMUNICATIONS INC
10-K405, 1997-03-31
NEWSPAPERS: PUBLISHING OR PUBLISHING & PRINTING

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SECURITIES & EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K

(X) Annual Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the fiscal year ended December 31, 1996.
Commission File Number: 0-7831

JOURNAL COMMUNICATIONS, INC.
(Exact name of Registrant as specified in its charter)

Wisconsin 39-0382060
(State of incorporation) (I.R.S. Employer identification number)

333 West State Street, Milwaukee, Wisconsin 53203
(Address of principal executive offices)

Registrant's telephone number, including area code:
(414) 224-2374

Securities registered pursuant to Section 12(b) of the Act:
NONE

Securities registered pursuant to Section 12(g) of the Act:
Common Stock, Par Value $0.25 Per Share
(title of class)

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 (or for such shorter period that
the Registrant was required to file such reports) and (2) has been subject
to such filing requirements for the past 90 days. Yes X No

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K (Section 229.405 of this chapter) is not contained
herein, and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K. [ X ]

State the aggregate market value of the voting stock held by non-
affiliates of the Registrant: Not applicable.

Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of March 19, 1997:

Class Outstanding at March 19, 1997
Common stock, par value $0.25 13,752,333

Portions of the annual shareholders report for the year ended December 31,
1996 are incorporated by reference into Parts I and II. Portions of the
proxy statement for the annual shareholders meeting to be held June 3,
1997, are incorporated by reference in Part III.

PART I ITEM 1. BUSINESS

The Registrant is a diversified communications and media company. Its
1996 revenues, broken down by business segments, were: publishing -
42.6%; printing - 32.5%; broadcast - 15.3%; telecommunications - 7.2%, and
direct marketing - 2.4%. Material developments in the Registrant's
business in 1996 included the acquisition of three radio stations in
Tucson, the announcement of the pending acquisition of a fourth radio
station in Omaha and the completion of a major expansion of Norlight's
fiber optic network in northern Wisconsin. In addition to the information
provided below, see Item 6, "Selected Financial Data," Item 7, "Management
Discussion and Analysis" and Item 8, "Consolidated Financial Statements
and Supplementary Data."

The following indicates the percent of consolidated revenues derived from
the activities noted for the past three (3) years:

Source 1996 1995 1994
Advertising 34.2% 35.8% 32.7%
Circulation 8.4 9.2 9.5
---- ---- ----
Publications 42.6 45.0 42.2
Broadcast 15.3 12.5 10.0
Commercial Printing 32.5 34.0 40.9
Telecommunications 7.2 6.6 5.7
Direct Marketing 2.4 1.9 1.2

Publications

Journal Sentinel Inc., a wholly-owned subsidiary of the Registrant,
publishes the major daily newspaper in the Milwaukee, Wisconsin, market.
Prior to April 2, 1995, it had published the evening Milwaukee Journal
(The Journal) since 1882, the Sunday edition of The Journal (Sunday
Journal) since 1911, and the morning Milwaukee Sentinel (the Sentinel)
since it was acquired in 1962. On April 2, 1995, both daily newspapers
were merged and became one morning newspaper, the Milwaukee Journal
Sentinel. Average paid circulation for the twelve months ended March 31,
for the last five years, as audited by the Audit Bureau of Circulation,
was:

1996 1995 1994 1993 1992
Journal Sentinel 298,206 -0- -0- -0- -0-
Sunday Journal 467,852 486,422 492,425 490,077 490,361
Journal - 0 - 211,801 228,454 238,351 240,566
Sentinel - 0 - 173,895 173,019 171,271 166,085

Advertising volume in column inches and preprint units for the Company's
Milwaukee newspapers for the last five calendar years was:

(in thousands)
1996 1995 1994 1993 1992
Column Inches
Full Run 2151.5 2,289.7 2,666.0 2,657.6 2,619.0
Part Run 250.7 257.1 213.4 260.9 181.3
Units
Preprint 2.5 2.8 2.4 1.9 1.6

There are 106 other newspapers and shoppers published in the four-county
Milwaukee market. Most of these are weekly publications, while a few are
biweekly, fortnightly or monthly. Of these 106 publications, 34 are paid
subscription and 72 are delivered without charge or are available free at
various public locations. These publications cover a wide variety of
interests, including community, business, labor, religious, ethnic,
foreign language or other special interest newspapers.

One other daily newspaper, The Freeman, is published in Waukesha and is
circulated in portions of Waukesha County. In addition, editions of USA
Today, Chicago Tribune, Chicago Sun Times, Madison Capitol-Times,
Wisconsin State Journal and New York Times are sold in the Milwaukee
market. The Journal Sentinel newspaper also competes for advertising
revenue or support with four (4) network-affiliated commercial television
stations, nine (9) independent television stations - (four (4) of which
are low power television stations), two (2) public television stations and
thirty-one (31) AM and FM radio stations located in the four-county
market, several cable television companies and several direct mail
services. One network-affiliated television station and two radio
stations in the Milwaukee market are owned by a subsidiary of the
Registrant.

The Journal Sentinel maintains news bureau offices in Madison, Wisconsin,
and Washington, D.C. It also has suburban bureaus in Waukesha and
Cedarburg and correspondents based in West Bend and Stevens Point,
Wisconsin. The Journal Sentinel is a member of the Associated Press and
subscribes to these wire services: the Washington Post-Los Angeles Times
News Service, the New York Times News Service and the Knight-Ridder News
Service. The Journal Sentinel is also a contributing member of the
Scripps Howard News Service.

The April 1995 merger resulted in a work-force reduction. Severance,
early retirement payments and other non-recurring costs associated with
the launch of the Journal Sentinel resulted in a pre-tax charge of $17.5
million.

During 1996, the average price per ton for newsprint increased by 1%
compared to the previous year. Total consumption for all products in 1996
was 3.9% below 1995's total. Newsprint is purchased from five Canadian
and two American suppliers. Supplies for 1997 are considered sufficient.

The Registrant also publishes, through its Add, Inc. subsidiary, nine (9)
weekly newspapers in southwestern Connecticut; six (6) weekly newspapers
and one (1) monthly controlled-circulation business publication in
Wisconsin; one (1) twice-weekly newspaper in Florida; forty-seven (47)
shopper publications, with twenty-two (22) in Wisconsin, fifteen (15) in
Ohio, three (3) in Florida, two (2) in Pennsylvania, two (2) in Vermont,
one (1) in Georgia, one (1) in Louisiana and one (1) in New York; three
(3) paid auto publications, with two (2) in Louisiana and one (1) in
Wisconsin; two (2) paid boating publications, with one in Louisiana and
one in Florida; three (3) free auto publications in Ohio; two (2) free
monthly Health & Fitness publications, with one (1) in Pennsylvania and
one (1) in Louisiana; six (6) monthly real estate publications and two (2)
senior citizens' publications in Ohio published six (6) times per year,
and one (1) nationwide electronic classified advertising database. In
February 1997, Add, Inc. purchased a shopper in Massachusetts and sold one
(1) shopper in Wisconsin and one (1) in Ohio.

Printing

IPC Communication Services, Inc. (formerly Imperial Printing Company), a
wholly-owned subsidiary acquired on October 6, 1992, specializes in the
production, management of inventory, materials procurement and fulfillment
for customers in the technology and publications industries. This
includes printing of medical, legal and technical journals for various
trade associations, documentation manuals for hardware and software
manufacturers and the duplication of CD-ROMs, disks and tapes. IPC is
based in San Jose, California, and has additional operations in Fremont
and Irvine, California, St. Joseph, Michigan and Roncq, France. No supply
restrictions are anticipated in 1997 for the raw materials IPC utilizes.

The heat-set web offset operations of Perry Printing Corporation were sold
in May 1995 for $95 million and preferred stock plus the assumption of
trade and other liabilities. Payment was made by the issuance of 115,000
shares of the buyer's preferred stock with a value of $11.5 million and
the delivery of the balance in cash.

NorthStar Print Group, Inc., a wholly-owned subsidiary of the Registrant,
is headquartered in Brown Deer, Wisconsin, and has manufacturing
operations in Brown Deer, Green Bay and Watertown, Wisconsin, and Norway,
Michigan. It employs a wide array of printing technologies in the various
markets it serves. These include sheed-fed offset, rotogravure and
flexographic processes that are used to print point-of-purchase materials,
labels for consumer goods and industry manufacturers (including in-mold
labels), and out-of-home media. NorthStar Print Group, Inc., is one of
the nation's largest producers of beer bottle labels and completed an
arrangement in 1996 to extend its label market to the largest beer brewer
in Brazil. Its supply of raw materials is considered adequate.

Trumbull Printing, Inc., though a wholly-owned subsidiary of the
Registrant, is managed by a subsidiary of Add, Inc. that is co-located in
Trumbull, Connecticut. Trumbull Printing, Inc., is a web offset printer
of newspapers, newspaper inserts and other publications. Its principal
raw materials, paper and ink, are expected to be in sufficient supply at
stable prices in 1997.

Broadcasting

Journal Broadcast Group, Inc., a wholly-owned subsidiary of the
Registrant, operates three (3) television stations and ten (10) radio
stations in six (6) states. All operate under licenses from the Federal
Communications Commission.

In Milwaukee, Journal Broadcast Group, Inc. has been the pioneer and
leading broadcaster since it started AM operations in 1927, FM in 1941
(discontinued 1950-1960) and television in 1947. News reporting and
editorial operations at Journal Broadcast Group, Inc., are independent of
the Registrant's newspaper operations.

Registrant's three (3) Milwaukee broadcast operations, WTMJ-TV, WTMJ-AM
and WKTI-FM, consistently rank high in audience rating surveys.
Competition for advertising revenue in the ten-county area of dominant
influence ("ADI") includes three (3) network-affiliated commercial
televisions stations, nine (9) independent television stations (four (4)
of which are low-power television stations), two (2) public television
stations, thirty-four (34) other radio stations, several cable television
companies, seven (7) daily newspapers (including one owned by Registrant),
and numerous weekly newspapers.

Journal Broadcast Group, Inc. also operates: KTNV-TV, Las Vegas, Nevada,
an ABC affiliate; WSYM-TV, Lansing, Michigan, a Fox affiliate; KQRC-FM,
Kansas City/Leavenworth, Kansas, affiliated with the ABC radio network;
KOSR-AM, KEZO-FM, and KKCD-FM in Omaha, Nebraska, where KOSR-AM and KKCD-
FM are affiliated with the CBS Spectrum Network, and KMXZ-FM, KFFN-AM and
KKHG-FM in Tucson, Arizona, where KKHG-FM and KFFN-AM are also affiliated
with the CBS Spectrum Network. WTMJ-TV is affiliated with the NBC
network. WTMJ-AM is affiliated with the CBS Radio network, and WKTI-FM is
affiliated with the ABC radio network. On October 10, 1996, Journal
Broadcast Group Inc. reached an agreement to purchase radio station KOSJ-
FM in Omaha, Nebraska, from Nebraska Broadcasting corporation. The
effective date of the transaction was January 30, 1997. Also in January
1997, Journal Broadcast Group, Inc. announced it had reached an agreement
with Heritage Media Corporation to exchange KQRC-FM for two (2) Knoxville,
Tennessee stations, WMYU-FM and WWST-FM. The exchange is expected to
close by mid-1997.

Telecommunications

Norlight Telecommunications, Inc., a wholly-owned subsidiary, provides
telecommunications services. This past year, Norlight Telecommunications,
Inc. was created from a merger of MRC Telecommunications, Inc., NorLight,
Inc., Telephone Associates Long Distance, Inc., and Bemidji Long Distance,
Inc. Norlight's business-to-business service markets advanced data
circuits, frame relay, Internet access, and switched voice services,
including domestic, international and calling card services, to medium and
large businesses in Wisconsin, Michigan, Minnesota and Illinois.
Norlight's residential service provides switched voice services to
residential and small business customers in Minnesota, Michigan and
Wisconsin. Norlight's carrier services offers state-of-the-art, bulk,
network transmission, including SONET and bandwidth-on-demand, to other
telecommunications carriers. Norlight's satellite and video services
provides terrestrial and satellite transmission of broadcast quality video
signals.

Direct Marketing

PrimeNet Marketing Services, Inc., a wholly-owned subsidiary, was acquired
in January 1994. Located in St. Paul, Minnesota, it is engaged in the
business of providing personalized database marketing services to
merchandisers and manufacturers, which services include the design and
development of database systems; the creation, maintenance and enhancement
of data files; the development of personalized communications for the
purpose of executing specific promotions; mail processing; receiving
orders and/or requests through its 1-800 Response Center, and fulfilling
such orders and requests.

Mega Direct, Inc., was acquired on June 22, 1995, by Add, Inc., a wholly-
owned subsidiary of the Registrant. Mega Direct is a marketing firm that
provides complete direct mail services, including design, printing and
distribution. It is one of the largest direct mail firms in the country
serving the automotive industry.

Compliance with Environmental Laws

The Registrant does not currently anticipate the need for significant
capital expenditures and expects no material adverse effects to its
earnings or competitive position to maintain compliance with environmental
laws.

Methods of Distribution

The Registrant's newspapers are distributed through networks of carriers,
most of whom are independent contractors. Advertising for Registrant's
newspapers and broadcast stations is generally sold by employees, with
some national advertising obtained by agents. Sales for the Registrant's
commercial printing, telecommunications and direct marketing operations
are generally obtained by employees and a limited number of agents.

Employees

The Registrant and its subsidiaries, as of December 31, 1996, had
approximately 4,410 full-time and 2,170 part-time employees.

Financial Information About Industry Segments

Financial information about Registrant's industry segments is presented in
Note 10 to the Consolidated Financial Statements appearing on page 29 of
Registrant's Annual Report, and such information is incorporated by
reference herein.

ITEM 2. PROPERTIES

Principal properties operated by the Registrant and its subsidiaries are
summarized as follows:

Subsidiary Location How Held Square Footage
Journal Sentinel Inc.
(Publishing)
Offices/Plant Milwaukee, WI Owned 464,000
Garage Milwaukee, WI Owned 67,500
Distribution Centers Milwaukee, WI Leased 166,100

ADD, Inc.
(Publishing)
Office/Plant WI, OH, GA, FL Owned or Leased 249,100
VT, NY, PA, LA

Hometown Publications, Inc.
(Publishing)
Office Trumbull, CT Leased 7,000

Auto Mart Publishing, Inc.
(Publishing)
Office Dayton, Columbus Leased 2,900
& Cincinnati, OH

Mega Direct, Inc.
(Direct Marketing)
Office Clearwater, FL Leased 39,700

Journal Broadcast Group, Inc.
(Broadcasting)
Office and Studios Milwaukee, WI Owned 101,500
KTNV-TV Studios Las Vegas, NV Owned 20,300
WSYM-TV Studios Lansing, MI Leased 10,300
KQRC-FM Studios Kansas City/
Leavenworth, KS Leased 3,700
KOSR-AM/KEZO-FM/
and KKCD-FM
Office and Studios Omaha, NE Leased 12,200
KMXZ-FM/KKHG-FM/
and KFFN-AM
Office and Studios Tucson, AZ Leased 6,600

NorthStar Print Group, Inc.
(Commercial Printing)
Office/Plant Brown Deer, WI Owned 127,300
Office/Plant Norway, MI Owned 101,700
Office/Plant Watertown, WI Owned 201,700

Label Products & Design
Inc.
(Commercial Printing)
Office and Plant Green Bay, WI Owned 39,600

Trumbull Printing,
Inc.
(Commercial Printing)
Office/Plant Trumbull, CT Owned 64,600

IPC Communication
Services, Inc.
(Commercial Printing)
Office/Plant/Warehouse St. Joseph, MI Leased 323,500
Office/Plant Fremont, CA Leased 97,900
Office/Plant Irvine, CA Leased 124,000
Office/Plant/Warehouse San Jose, CA Leased 226,300

Norlight Telecommunica-
tions, Inc.
(Fiber optic & Rubicon, WI Owned 3,800
microwave transmission Skokie, IL Owned 6,100
services and long
distance Afton, WI Owned 3,800
telecommunications Arden Hills, MN Owned 1,700
services) Minneapolis, MN Leased 3,400
Brookfield, WI Leased 21,600
Duluth/Bemidji, MN Leased 5,200
Green Bay, WI Leased 200

Nordoc Software
Services, S.A.
(Commercial Printing)
Office/Plant Roncq, France Leased 80,700

PrimeNet Marketing
Services, Inc.
(Data Base Management) Mendota Heights,
Office/Plant MN Leased 87,200

ITEM 3. LEGAL PROCEEDINGS
The Company paid damages of $5.7 million in February 1996 in final
settlement of a patent infringement lawsuit. Otherwise, the Company is
involved in various claims and lawsuits incidental to its business, which,
in the opinion of management, will not have a material effect in the
aggregate on the Company's financial position or operations.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.

ITEM 4A. EXECUTIVE OFFICERS OF REGISTRANT
The executive officers of Registrant, as of March 19, 1997, all of whom
hold office until the next annual meeting of the board of directors, which
will be held immediately following the annual meeting of shareholders on
June 3, 1997, are:

Name Age Office Held Since
Robert A. Kahlor 63 Chairman of the Board/CEO September 4, 1992
Steven J. Smith 46 President/COO September 4, 1992
Douglas G. Kiel 48 Senior Vice President June 2, 1992
Keith K. Spore 54 Senior Vice President September 6, 1995
Paul M. Bonaiuto 46 Senior Vice President/CFO March 5, 1996
Robert M. Dye 49 Vice President June 5, 1990
Stephen O. Huhta 41 Vice President June 8, 1993
Ronald G. Kurtis 49 Vice President June 8, 1993
James J. Ditter 35 Vice President September 6, 1995
William T. Lutzen 35 Vice President June 7, 1994
Daniel L. Harmsen 41 Vice President March 5, 1996
Mark J. Keefe 37 Vice President June 4, 1996
Douglas G. Hosking 40 Vice President September 4, 1996
Richard J. Gasper 53 Vice President June 4, 1996
Karen O. Trickle 40 Treasurer December 3, 1996
Paul E. Kritzer 54 Vice President June 5, 1990
& Secretary September 1, 1992
Christine A.
Farnsworth 48 Assistant Secretary June 8, 1993

All of the executive officers of the Registrant except Messrs. Bonaiuto,
Hosking, Keefe, Ditter and Gasper and Ms. Trickle have been employed by
the Company in key management positions for more than five (5) years.
Mr. Bonaiuto has been Chief Financial Officer of the Registrant since
January 1996 and was elected a Senior Vice President in March 1996.
Previously Mr. Bonaiuto had been President of NorthStar Print Group, Inc.,
a subsidiary of the Registrant, from June 1994 to January 1996; Senior
Vice President and Chief Financial Officer of Perry Printing Corporation,
then a subsidiary of the Registrant, from July 1992 to June 1994, and
Executive Vice President of The Peterson Group, Wilmington, Delaware, a
private equity investment firm. Mr. Ditter was elected President of
Norlight Telecommunications, Inc., a subsidiary of the Registrant, in
September 1995 after serving as that company's Senior Vice President and
Chief Financial Officer since August 1992. Prior to that, Mr. Ditter had
been the Controller of Peck Foods Corporation, Milwaukee. Mr. Gasper has
been President of NorthStar Print Group, Inc., since January 1996. Prior
to that he was Vice President and General Manager of Label Products &
Design, Inc., Green Bay, Wisconsin, from April 1993 to January 1996, and
President and owner of Competitive Advantages, Inc., a training and
consulting firm in Florence, South Carolina, from April 1992 to April
1993. Mr. Hosking joined the Registrant in April 1996 as President of IPC
Communication Services, Inc. Previously he had been a Vice President for
commercial development and general manager of the food fiber division of
Opta Food Ingredients, Inc., for two years and Executive Vice President of
Courier Corp., San Francisco, a national book printer. Mr. Keefe joined
the Registrant in October 1995 as President of PrimeNet Marketing
Services, Inc. Prior to that he had been a Vice President for Donnelly
Marketing, Inc., St. Louis Park, Minnesota, from January 1994 to September
1995, and a Vice President of FDC, Inc. (a subsidiary of Fingerhut
Corporation) in Minnetonka, Minnesota. Ms. Trickle started with
Registrant in September 1996. Previously, she had been Assistant
Treasurer (International) for Harnischfeger Industries, Inc., Brookfield,
Wisconsin, from September 1994 to September 1996, and Assistant Treasurer
for Applied Power, Inc., Butler, Wisconsin, up to September 1994.

PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK
AND RELATED STOCKHOLDER MATTERS

There is no established public trading market for the Registrant's common
stock. Units representing beneficial interest in the Registrant's common
stock can be purchased only by full-time employees with ninety (90) days
service and part-time employees with two consecutive years of service of
one thousand (1,000) hours each year. As of March 19, 1997, the Journal
Employes' Stock Trust (the "Trust") owned of record 12,960,000 shares, or
90%, of the issued common stock of the Registrant. The Trust issues
units, each representing a beneficial interest in one share of the
Registrant's stock, to eligible employees ("unitholders"). On March 19,
1997, 3,214 unitholders owned 11,386,628 units (representing 82.8% of
Registrant's outstanding common stock) and thus were the beneficial
owners of a like number of shares of the Registrant's stock held by the
Trust. The balance of 1,573,372 units issued by the Trust were, on the
above date, held by personal trusts and an employee benefit trust and by
the Registrant, treated as treasury stock and not voted.

Prior to all meetings of shareholders of the Registrant, the trustees of
the Trust ("Trustees") are required to deliver to each active employee-
unitholder a proxy, with the right of substitution, for the number of the
Registrant's shares represented by his or her units.

Unitholders may sell their units only through procedures, and at a formula
price, dictated pursuant to the Stock Trust Agreement under which the
Trust was formed. Whenever a unitholder ceases to be an employee, for any
reason except retirement, corporate downsizing or divestiture, he or she
must offer his or her units for resale to active employees designated by
the President of the Registrant or the Registrant. Employees who retire
may retain a decreasing percentage of their units for up to ten (10) years
after the first anniversary of their retirement. All units held by
retirees are voted by the Trustees. Units may also be held by employee
benefit trusts, and unitholders may transfer units to personal trusts and
to charitable, educational or religious trusts. All units held by such
trusts are likewise voted by the Trustees. As of March 19, 1997,
retirees, personal trusts, an employee benefit trust, and other trusts
held 5,048,491 units, representing a beneficial interest in 36.7% of the
Registrant's outstanding common stock.

All of the Trustees are directors of the Registrant. They have no
financial interest in the Registrant's stock owned by the Trust other than
through the units they own individually.

The Registrant's unit price and dividend history for the past decade are
presented in the following table:

Employee Stock Ownership Plan

Unit Unit Unit Price Total
Price Price Increase Cash Annual
Year Begin End (Decrease) Dividend Return

1996 - 4th Qtr 36.27 37.15 0.88 0.55 8.6
1996 - 3rd Qtr 36.14 36.27 0.13 0.55
1996 - 2nd Qtr 36.10 36.14 0.04 0.55
1996 - 1st Qtr 36.24 36.10 (0.14) 0.55
1995 - 4th Qtr 35.95 36.24 0.29 0.55 8.3
1995 - 3rd Qtr 36.12 35.95 (0.17) 0.55
1995 - 2nd Qtr 35.62 36.12 0.50 0.55
1995 - 1st Qtr 35.40 35.62 0.22 0.45
1994 34.64 35.40 0.76 1.90 7.7
1993 33.60 34.64 1.04 1.80 8.5
1992 32.60 33.60 1.00 1.80 8.6
1991 31.48 32.60 1.12 1.80 9.3
1990 29.66 31.48 1.82 1.70 11.9
1989 26.65 29.66 3.01 1.70 17.7
1988 23.71 26.65 2.94 1.50 18.7
1987 20.94 23.71 2.77 1.38 19.8

In addition to the Journal Employees' Stock Trust, there are two (2) other
record holders of stock of the Registrant. The Registrant is not aware of
any recent sales of such stock.

ITEM 6. SELECTED FINANCIAL DATA

Selected financial data of the Registrant is presented in the Registrant's
Annual Report on pages 20 and 21 and is incorporated herein by reference.

ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis is presented on pages 17 through 19
in Registrant's Annual Report and is incorporated herein by reference.

ITEM 8. CONSOLIDATED FINANCIAL STATEMENTS
AND SUPPLEMENTARY DATA

The Registrant's Financial Statements with Report of Independent Public
Auditors are presented on pages 22 through 30 of the Registrant's Annual
Report and are incorporated herein by reference.

ITEM 9. CHANGES AND DISAGREEMENTS WITH ACCOUNTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.

PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Information in response to this item is incorporated herein by reference
to the Company's proxy statement, which shall be filed with the Securities
and Exchange Commission no later than April 30, 1997. Information about
executive officers of the Company is included in Part I of this Form 10-K.

ITEM 11. EXECUTIVE COMPENSATION

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT

The following chart states the equity ownership of each Director of the
Registrant:

Units Held Percent of
Held Office as of March 19, Ownership
Name Age Since 1997(1) *denotes <1%

Todd K. Adams 38 June 4, 1996 16,395 *
Paul M. Bonaiuto 46 June 8, 1993 20,340 *
James J. Ditter 35 September 6, 1995 5,000 *
Robert M. Dye 49 March 6, 1990 47,800 *
Christine A.
Farnsworth 48 June 8, 1993 31,600 *
Richard J. Gasper 53 June 4, 1996 9,090 *
Rhonda G.
Giebenrath 43 June 4, 1996 2,350 *
David J. Hauser 42 June 4, 1996 3,295 *
Thomas J. Heinen 48 June 4, 1996 11,740 *
Douglas G. Hosking 40 September 4, 1996 6,420 *
Stephen O. Huhta 41 June 8, 1993 32,355 *
Robert A. Kahlor 63 March 6, 1973 96,435 *
Mark J. Keefe 37 June 4, 1996 9,000 *
Douglas G. Kiel 48 June 4, 1991 36,000 *
Paul E. Kritzer 54 June 5, 1990 42,445 *
Ronald G. Kurtis 49 June 8, 1993 61,000 *
David G. Meissner 59 June 7, 1988 --(2) --(2)
Armin J. Ott 49 June 4, 1996 2,970 *
Donna M. Riehle 29 June 4, 1996 150 *
Ralph P. Schumacher 53 June 4, 1996 5,500 *
Steven J. Smith 46 June 2, 1987 81,870 *
Keith K. Spore 54 September 6, 1995 28,500 *
Christopher S.
Thomas 27 June 6, 1995 940 *
David M. Thomas 29 June 4, 1996 197 *
James L. Forbes 64 September 4, 1996 --(3)
Roger D. Peirce 59 September 4, 1996 --(3)

(1) A "Unit" is equivalent to a share of the common stock of Journal
Communications, Inc.

(2) Mr. Meissner owns no Units but is an officer and director of
Matex Inc., which owns 1,320,000 shares of Journal stock. Mr.
Meissner's wife is also an officer and director of Matex Inc.
and together with her children owns or has a beneficial interest
in 33% of the outstanding common stock of Matex Inc. Mrs.
Meissner also has a 33% beneficial interest in 120,000 shares of
Journal Communications, Inc. common stock. Other members of
Mrs. Meissner's family own or have a beneficial interest in the
remaining 67% of the Matex Inc. shares and the 120,000 shares of
Journal stock.

(3) Under the terms of the Trust, non-employees are not permitted to
own Units.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information in response to this item is incorporated herein by reference
to the Company's proxy statement, which shall be filed with the Securities
and Exchange Commission no later than May 1, 1997.

PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
AND REPORTS ON FORM 8-K

(a) 1. and 2. Financial Statements and Financial Statement Schedules
The following consolidated financial statements of the
Registrant are included in Item 8:

Registrant's
Annual Report
Page Number
Consolidated Balance Sheets at
December 31, 1996 and 1995 22

Consolidated Statements of Earnings
for each of the three years in
the period ended December 31, 1996 23

Consolidated Statements of Cash Flows
for each of the three years in the
period ended December 31, 1996 24

Consolidated Statements of Retained
Earnings for each of the three years
in the period ended December 31, 1996 25

Notes to Consolidated Financial Statements 25-29

Form 10-K
Page Number

Financial Statement Schedules:
Consolidated schedule for each of the
three years in the period ended
December 31, 1996:
II - Valuation and qualifying accounts 16

All other schedules are omitted since the required information is
not present, or is not present in amounts sufficient to require
submission of the schedule, or because the information required is
included in the consolidated financial statements and notes
thereto.

3. Exhibits
The exhibits listed on the exhibit index hereto are filed as part of
this annual report.

(b) Reports on Form 8-K

No report on Form 8-K was required to be filed by the Registrant
during the quarter ended December 31, 1996.

<PAGE>
JOURNAL COMMUNICATIONS, INC.

SCHEDULE II - CONSOLIDATED VALUATION AND QUALIFYING ACCOUNTS

Years ended December 31, 1996, 1995 and 1994

Balance at Additions Deductions Balance
beginning charged to from at end
of year earnings allowances of year

Allowance for
doubtful receivables:

1996 $2,475,670 $4,184,527 $3,418,685 $3,241,512
========= ========= ========= =========

1995 $2,065,012 $3,007,365 $2,596,707 $2,475,670
========= ========= ========= =========

1994 $2,500,533 $2,952,136 $3,387,657 $2,065,012
========= ========= ========= =========

Note:

(a) Accounts receivable written off, less recoveries, against the
allowance.

<PAGE>
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Annual Report to
be signed on its behalf by the undersigned, thereunto duly authorized.

JOURNAL COMMUNICATIONS, INC.

By:/s/ Robert A. Kahlor
Robert A. Kahlor
Chairman of the Board and CEO

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:

/s/ Todd K. Adams March 31, 1997
Todd K. Adams, Director

/s/ Paul M. Bonaiuto March 31, 1997
Paul M. Bonaiuto, Director & Chief
Financial Officer (Principal
Financial Officer)

___________________________ March _____, 1997
James J. Ditter, Director

/s/ Robert M. Dye March 31, 1997
Robert M. Dye, Director

/s/ Christine A. Farnsworth March 31, 1997
Christine A. Farnsworth, Director

___________________________ March _____, 1997
James L. Forbes, Director

___________________________ March _____, 1997
Richard J. Gasper, Director

/s/ Rhonda G. Giebenrath March 31, 1997
Rhonda G. Giebenrath, Director

/s/ David J. Hauser March 31, 1997
David J. Hauser, Director

/s/ Thomas J. Heinen March 31, 1997
Thomas J. Heinen, Director

___________________________ March _____, 1997
Douglas G. Hosking, Director

___________________________ March _____, 1997
Stephen O. Huhta, Director

/s/ Robert A. Kahlor March 31, 1997
Robert A. Kahlor, Director &
Chairman of the Board (Principal
Executive Officer)

___________________________ March _____, 1997
Mark J. Keefe, Director

/s/ Douglas G. Kiel March 31, 1997
Douglas G. Kiel, Director

/s/ Paul E. Kritzer March 31, 1997
Paul E. Kritzer, Director

/s/ Ronald G. Kurtis March 31, 1997
Ronald G. Kurtis, Director

___________________________ March _____, 1997
David G. Meissner, Director

___________________________ March _____, 1997
Armin J. Ott, Director

___________________________ March _____, 1997
Roger D. Peirce, Director

/s/ Donna M. Riehle March 31, 1997
Donna M. Riehle, Director

/s/ Ralph P. Schumacher March 31, 1997
Ralph P. Schumacher, Director

___________________________ March _____, 1997
Steven J. Smith, Director

/s/ Keith K. Spore March 31, 1997
Keith K. Spore, Director

___________________________ March _____, 1997
Christopher S. Thomas, Director

___________________________ March _____, 1997
David M. Thomas, Director

<PAGE>
JOURNAL COMMUNICATIONS, INC.

INDEX TO EXHIBITS
(Item 14(a))

Exhibits

(3.1) Articles of Association of Journal Communications, Inc., as
amended (incorporated by reference to Exhibit 3.1 to Journal
Communications, Inc.'s Annual Report on Form 10-K for the
year ended December 31, 1995 (Commission File No. 0-7831)).

(3.2) By-Laws of Journal Communications, Inc. (incorporated by
reference to Exhibit 3.2 to Journal Communications, Inc.'s
Current Report for Form 8-K dated March 5, 1996 (Commission
File No. 0-7831)).

(9.1) The Journal Employees' Stock Trust Agreement, dated May 15,
1937, as amended (incorporated by reference to Exhibit 9 of
the Annual Report on Form 10-K of Journal Communications,
Inc. for the fiscal year ended December 31, 1995 (Commission
File No. 0-7831)).

(9.2) Further amendment to Stock Trust Agreement as approved by
unitholders on October 30, 1996 (incorporated by reference to
Exhibit A to the Definitive Proxy Statement of the Journal
Employees' Stock Trust included in the Trust's Schedule 14A
filed October 1, 1996 (Commission File No. 0-7832))

(13) Registrant Annual Report to the extent incorporated by
reference herein

(21) Subsidiaries of the Registrant, filed herewith

(23) Consent of Independent Auditors, filed
herewith

(27) Financial Data Schedule, filed herewith

[Pages 17-19]

Management Discussion and Analysis

CONSOLIDATED

Revenue from continuing operations was $622.2 million in 1996 compared with
$591.8 million in 1995, a 5.1% increase. In 1994, revenue from continuing
operations was $517.6 million. Operating earnings increased 62% to $67
million in 1996. 1995 operating earnings were $41.4 million, a decrease
from $66.3 million in 1994. Operating earnings in 1995 were affected by the
one-time newspaper merger charges of $17.5 million and the Webcraft lawsuit
settlement of $5.7 million.

During 1996, continued improvement in advertising market share and the
benefit of Super Bowl XXX, the Olympics and political advertising revenue
were key factors in helping the broadcast segment increase advertising
revenue and operating profits. The publications segment experienced
improved operating earnings due largely to cost control measures and
operating efficiencies attained during the year as a result of the
newspaper merger in 1995. Revenue growth was achieved in the
telecommunications segment through increased private line sales and new
SONET-based services. The direct marketing segment showed vast improvement
in operating results, due in large part to a refocusing of one of the
companies within the segment.

PUBLICATIONS

The publications segment includes daily and weekly newspapers, shoppers
and specialty publications.

Revenue was $264.9 million in 1996, down 0.8% compared with 1995 but 1.4%
better than 1994. 1995 and 1994 revenues for this segment were $267.1
million, and $261.3 million, respectively. In 1996, earnings were $33.9
million, an 111.9% increase over 1995. Earnings in 1996 of $16 million
included $17.5 million of newspaper merger charges. Without the $17.5
million in merger charges, 1996 earnings increased 1.3% from 1995.
Earnings for 1994 were $44 million.

Journal Sentinel Inc. is the largest company in the publications segment.
Total revenue in 1996 decreased 1.3% to $209.5 million from $212.2 million
in 1995. Compared to 1994, 1996 revenue levels remained flat. In 1996,
earnings increased 21% over 1995, excluding merger charges. With the
merger charges included, 1996 earnings increased 174.6% over 1995.
However, the 1996 earnings were 10% below 1994, which was primarily the
result of higher newsprint costs.

The dramatic turnaround in 1996 earnings is the result of an emphasis on
cost controls and greater efficiencies as a result of the merger in 1995.
Newsprint costs were up 1% in 1996 compared with 1995. Newsprint costs for
1997 are expected to be lower than they were for 1996.

Advertising revenue in 1996, 1995 and 1994 was $155.9 million, $155.9
million and $149.4 million, respectively. Advertising revenue remained
level as a result of classified advertising revenue increasing 6.4% over
1995, while retail and general advertising revenue declined 2.4% and
13.5%, respectively. The increase in classified advertising revenue is
mostly related to employment advertising. The 1996 shortfall in both
retail and general advertising is the result of lower ROP (Run of Press)
and preprint revenue.

In 1996, circulation revenue totaled $51.2 million, a decrease of 3.5%, or
$1.9 million, from 1995 and a 9.3% decrease from 1994. Most of the 1996
decrease compared with 1995 and 1994 is due to the carryover factor of the
merger and the lowering of the wholesale rates.

Add Inc. is the other operation in the publications segment. Its 1996
revenue was $55.4 million, a 0.9% change compared with 1995 revenue of
$54.9 million. In 1994, revenue was $51.8 million. Earnings in 1996 showed
an 8.2% decrease from the prior year. This resulted from both increased
newsprint costs, which only began to moderate midyear, advertiser
attrition, and increased price competition in many of the markets in which
the operations conduct business. In 1996, revenue for the Wisconsin
operations increased by 5.5% while revenue for the Ohio operations
decreased by 5.7%. During 1996, the Connecticut and Florida operations
showed improvement in earnings over the previous year while those in
Wisconsin, Ohio, Pennsylvania and Vermont showed declines.

BROADCAST

In 1996, revenue was $95.7 million, a 28.3% increase over 1995 revenue of
$74.6 million and 50.9% greater than 1994 revenue of $63.4 million. The
1996 revenue increase was due to excellent audience ratings at all of our
broadcast stations and $4.5 million in Super Bowl, Summer Olympics and
election year political advertising. In addition, the broadcast division
acquired three radio stations in Tucson in 1996. Earnings in 1996
increased 60.9% over 1995 and 116.6% over 1994.

In 1996, the Company's television stations accounted for 67.1% of the
division's revenue and 77.4% of its earnings. The Milwaukee, Las Vegas and
Lansing television stations demonstrated substantial revenue and earnings
growth over last year.

Operating earnings for the Milwaukee, Kansas City and Omaha radio stations
were well ahead of 1995 results.

During 1996, the broadcast group sold its two radio stations in Wausau,
Wis. The sale had no material effect on the Company's consolidated
results. In 1997, the company acquired an additional FM radio station in
Omaha.

PRINTING

The 1996 revenue for NorthStar Print Group Inc. was $55.4 million, a 2.7%
increase from the prior year's revenue of $53.9 million and a 4.2%
decrease from 1994. NorthStar increased earnings to $2.9 million from
earnings of $0.6 million in 1995. In 1994, NorthStar incurred a loss
before taxes of $0.7 million. The Milwaukee and Green Bay operations
experienced a decrease in revenue, but earnings at all locations improved
in 1996. Norway / Watertown's improved earnings were driven largely by
additional revenue, while Milwaukee and Label Products & Design went
through a combination of pricing and operational cost controls. In
addition, all locations showed improved operating productivity.

IPC Communication Services (IPC) revenue decreased $2.3 million to $119.2
million in 1996, a 1.9% decrease compared to 1995 but a 62.5% increase
compared to 1994. In 1996, IPC experienced a substantial loss. The
Northern California and French operations, which contributed to the
overall loss, refocused during 1996. Operating results improved in the
fourth quarter of 1996.

The printing plants of Add Inc. had revenue of $28.9 million in 1996, a
6.7% increase over 1995 revenue of $27.1 million and 39.6% over 1994
revenue of $20.7 million. In 1996, earnings increased by 47.6% from 1995.
Earnings increased 8.9% in 1995 compared with 1994.

TELECOMMUNICATIONS

In 1996, revenue for Norlight Telecommunications Inc. was $45.4 million, a
13.4% increase over the prior year's revenue of $40 million. Revenue was
$36 million in 1994. The increase is due to a substantial growth in
private line capacity sold and the offering of SONET-based services. The
four legal entities that make up the telecommunications operations were
merged into one legal entity during 1996. This merger facilitated
marketing of all services under one name and streamlined the company's
regulatory reporting requirements. Earnings at Norlight increased 2% in
1996 compared with 1995 and 6.7% compared with 1994.

DIRECT MARKETING

PrimeNet Marketing Services had a decrease in revenue of 8.1% in 1996 to
$6.4 million, down from $6.9 million in 1995. Revenue was $7.8 million in
1994. The Company's 1996 earnings of $0.6 million compares with losses of
$2.2 million and $1.3 million in 1995 and 1994, respectively. The
decreased revenue and increased earnings in 1996 primarily reflect the
impact of a major refocusing, which took place in 1995.

Mega Direct was purchased by Add Inc. on June 22, 1995. Mega Direct had
revenue of $8.5 million in 1996 compared with $4.7 million for the partial
year in 1995. Earnings increased in 1996 compared with 1995 by 315.7%,
reflecting a full year of operation as part of Add Inc. in 1996. Mega
Direct was strategically realigned under the management of PrimeNet
Marketing Services in early 1997.

NEWSPAPER MERGER CHARGES

On April 2, 1995, Journal Sentinel Inc. merged The Milwaukee Journal and
the Milwaukee Sentinel into a morning newspaper called the Milwaukee
Journal Sentinel. The merger of the newspapers resulted in a pretax charge
of $17.5 million recorded in full in 1995. The charge consisted of $11.3
million in termination benefits for approximately 250 full-time employees
and $6.2 million for non-recurring start-up costs of the new newspaper.

OTHER INCOME AND EXPENSE

Dividends and interest income were $3.4 million, a decrease from $4.8
million in 1995. The decrease in 1996 was the result of a decrease in
short-term investments. This amount was $1.7 million in 1994.

INCOME TAXES

Income taxes were 41.9% of pre-tax earnings in 1996, 39.6% in 1995 and
40.1% in 1994. Changes in the effective tax rate are a result of state
income taxes, valuation allowances on foreign net operating losses and
permanent tax differences. Permanent tax differences exist for goodwill
amortization for acquisitions before 1993 and the increase in cash
surrender value of the Company's life insurance investment pool.

EARNINGS FROM CONTINUING
OPERATIONS

In 1996, earnings from continuing operations of $41 million or $3.13 per
share were $13.1 million or $1.12 per share more than 1995. The merger
charges and Webcraft settlement reduced 1995 earnings by $1.00 per share.
Excluding the merger charges and the Webcraft settlement, earnings per
share from continuing operations were $3.01 in 1995. 1994 earnings from
continuing operations were $40.6 million or $2.90 per share.

DISCONTINUED OPERATIONS

On April 27, 1995, the Company sold substantially all the assets used in
the business of its wholly owned subsidiary, Perry Printing Corporation.
Perry was a heatset web offset printer of long-run catalogs and
publications. The sale of Perry allowed the Company to redirect its assets
to other segments of the Company and earn a better return on investment.
As a result, the Perry operations have been accounted for as a
discontinued operation.

Net revenues were $45.9 million and $117 million in 1995 and 1994,
respectively. Earnings from discontinued operations were $1.4 million and
$3.3 million during the same years.

The aggregate sale price was approximately $95 million plus the assumption
of trade and other liabilities. Payment was made by the issuance of
115,000 shares of the buyer's preferred stock with a value of $11.5
million and the balance of the payment in cash.

Proceeds were used in 1995 to fund the Add Inc. and Journal Broadcast
Group acquisitions, the Journal Sentinel merger charges and increase the
Company's cash reserves.

NET EARNINGS

Net earnings for 1996 were $41 million or $3.13 per share, compared with
net earnings of $44.2 million or $3.18 per share in 1995. In 1994, net
earnings for the year were $43.9 million or $3.13 per share.

LIQUIDITY AND CAPITAL RESOURCES

Cash provided by operations, which is a significant source of the
Company's liquidity, totaled $94.8 million, $43.2 million and $59.3
million in 1996, 1995 and 1994, respectively.

Principal uses of cash for investing purposes during this period were for
property and equipment expenditures and acquisitions. Capital expenditures
for property and equipment totaled $33.8 million in 1996, $33.4 million in
1995 and $36.6 million in 1994. The Company also has continued to be
active in acquiring other businesses. Cash used for acquisitions was $17
million, $22.8 million and $12.7 million in 1996, 1995 and 1994,
respectively. In January 1997, the Company acquired an additional radio
station in Omaha, Neb. The cash purchase price was approximately $5
million.

Cash provided by discontinued operations was $82.8 million in 1995 and
$7.2 million in 1994.

Cash used in financing activities totaled $52.8 million, $46.5 million and
$24.8 million in 1996, 1995 and 1994, respectively. Dividends paid during
1996 were $28.6 million or $2.20 per share, compared with $29.2 million
($2.10 per share) in 1995 and $26.7 million ($1.90 per share) in 1994.
Additionally, the net purchases of treasury stock totaled $17.2 million in
1996 and $17.1 million in 1995. In 1994, the Company had net sales of
treasury stock of $2.7 million.

Net working capital at the end of 1996 decreased to $90 million compared
with $111.1 million at the end of 1995. Commitments for television
programs not yet produced as of December 31, 1996, were $5.9 million. The
Company has traditionally not used debt as a source of funds.

EFFECT OF INFLATION

The Company's results of operations and financial conditions have not been
significantly affected by general inflation. The Company has reduced the
effect of rising costs through improvements in productivity, cost
containment programs and, where the competitive environment exists,
increased selling prices. See the publications section for discussion of
the impact of newsprint costs.

<PAGE>

[Pages 20-21]
<TABLE>
Ten Years In Review
<CAPTION>
(Dollars in
thousands except
for per share amounts) 1996 1995 1994 1993 1992 1991

<S> <C> <C> <C> <C> <C> <C>
Earnings and Dividends

Earnings from
continuing operations
before income taxes(6) $ 70,691 $ 46,231(5) $ 67,831 $ 67,498 $ 62,670 $ 55,458
Net earnings 41,043 44,213 43,867 44,204 41,631 40,035
Earnings for option
price 41,043 43,149 43,867 44,204 41,631 40,626
Dividends 28,563 29,156 26,699 25,156 25,244 25,358
Earnings retained 12,480 15,057 17,168 19,048 16,387 14,677

Per Share

Net earnings $ 3.13 $ 3.18 $ 3.13 $ 3.16 $ 2.97 $ 2.84
Earnings for option
price 3.13 3.10 3.13 3.16 2.97 2.88
Dividends 2.20 2.10 1.90 1.80 1.80 1.80
Book value 27.41 26.85 26.04 24.76 23.40 22.11
Unit option price 37.15 36.24 35.40 34.64 33.60 32.60

Net Sales (6)

Publications $264,883 $ 267,148 $ 261,303 $244,529 $ 238,386 $232,756
Broadcast 95,690 74,623 63,445 54,851 52,891 52,088
Printing 203,477 202,556 151,853 126,401 68,372 60,161
Telecommunications 45,351 39,977 35,974 32,411 31,256 15,398
Direct marketing 14,890 11,578 7,799 - - -
Other - - - - - -
Eliminations (2,057) (4,050) (2,793) (3,501) (1,814) (1,631)
------- ------- ------- ------- ------- -------
Total net sales $622,234 $ 591,832 $ 517,581 $454,691 $ 389,091 $358,772

Operating Expenses(6)

Payroll $181,123(8) $ 169,198(7) $ 158,450(4) $137,580(3) $ 117,815(2) $105,151
Materials and
component services 171,958 172,381 117,320 99,170 75,685 77,576
Depreciation and
amortization 37,635 34,413 29,779 28,335 25,585 24,301
Other services 164,501 174,461 145,756 123,675 109,721 101,884
------- ------- ------- ------- ------- -------
Total operating
expenses $555,217(8) $ 550,453(7) $ 451,305(4) $388,760(3) $ 328,806(2) $308,912

Invested Capital
(Dollars in thousands)

Property and equipment(6) $163,693 $ 160,433 $ 149,687 $135,716 $ 124,107 $121,665
Net working capital 89,980 111,116 107,675 100,780 95,774 93,847
Long-term obligations 1,524 2,762 2,947 3,609 2,251 1,369
Stockholders' equity 361,030 366,330 367,429 347,447 328,230 311,772
Total assets 473,564 474,738 461,416 437,429 409,863 389,958
Percent return on
stockholders' equity 11.2% 12.0% 12.6% 13.5% 13.4% 13.1%
Percent return on
total assets 8.6% 9.6% 10.0% 10.8% 10.7% 10.0%

(Dollars in Average annual
thousands except compound
for per share amounts) 1990 1989 1988 1987 % increase

<S> <C> <C> <C> <C> <C>
Earnings and Dividends

Earnings from
continuing operations
before income
taxes(6) $ 48,992 $ 69,668 $ 61,901 $ 57,048(1) 2.41%
Net earnings 41,113 54,988 49,633 41,614(1) -0.15
Earnings for
option price 49,443 54,988 51,745 41,944(1) -0.24
Dividends 24,192 24,374 21,496 19,576 4.29
Earnings retained 16,921 30,614 28,137 22,038 -6.12

Per Share

Net earnings $ 2.89 $ 3.83 $ 3.46 $ 2.93(1) 0.74%
Earnings for option
price 3.47 3.83 3.61 2.95(1) 0.66
Dividends 1.70 1.70 1.50 1.38 5.32
Book value 21.54 20.08 18.14 16.27 5.97
Unit option price 31.48 29.66 26.65 23.71 5.12

Net Sales(6)

Publications $235,853 $ 232,371 $ 222,209 $200,873 $3.21
Broadcast 56,456 54,087 52,744 48,339 7.88%
Printing 57,852 55,301 51,427 43,923 18.57
Telecommunications 12,414 11,429 11,342 11,539 16.43
Direct marketing - - - - N.A.
Other - - - 1,986 N.A.
Eliminations (1,462) (1,608) (940) (767) N.A.
------- ------- ------- ------- -------
Total net sales $361,113 $ 351,580 $ 336,782 $305,893 $8.21

Operating Expenses(6)

Payroll $102,463 $ 98,161 $ 94,787 $ 89,029 8.21%
Materials and
component services 80,318 81,008 79,835 71,183 10.30
Depreciation and
amortization 20,442 19,536 19,884 14,553 11.13
Other services 103,084 90,756 84,477 76,931 8.81
------- ------- ------- ------- -------
Total operating
expenses $306,307 $ 289,461 $ 278,983 $251,696 9.19%

Invested Capital
(Dollars in
thousands)

Property and
equipment(6) $ 83,154 $ 76,746 $ 74,789 $ 66,131 10.60%
Net working capital 128,859 125,841 106,805 97,525 -0.89
Long-term
obligations 608 1,808 2,583 9,072 N.A.
Stockholders' equity 306,793 288,036 260,002 231,446 5.06
Total assets 401,371 364,860 335,395 307,682 4.91
Percent return on
stockholders' equity 14.3% 21.1% 21.4% 20.8%
Percent return on
total assets 11.3% 16.4% 16.1% 15.5%

1) Does not include cumulative effect on prior years of change in accounting for deferred income taxes of $3,572 or $0.25
per share in 1987.

2) Includes full year of Norlight and IPC since Oct. 6.

3) Includes full year of IPC, and Nordoc Software Services since Feb. 28.

4) Includes full year of PrimeNet Marketing Services.

5) Does not include gain on sale of Perry Printing Corp. of $14,941 or $1.07 per share in 1995.

6) Figures have been restated to exclude the discontinued operations of Perry Printing Corp. (1987 - 1995).

7) Includes Omaha radio stations since Jan. 24 and Mega Direct since June 22.

8) Includes Tucson radio stations since Jan. 29.
</TABLE>
<PAGE>

[Pages 22-30]

Consolidated Financial Statements

CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except
share and per share amounts)

December 31
ASSETS 1996 1995
Current assets:
Cash $ 12,383 $ 10,133
Short-term investments (Note 1) 52,900 61,362
Receivables, net (Note 1) 93,915 94,670
Inventories (Note 1) 27,678 31,292
Prepaid expenses 10,301 9,212
Prepaid income taxes - 4,198
Deferred income taxes (Note 3) 3,813 4,706
------- -------
Total current assets 200,990 215,573
Property and equipment, at cost:
Land and land improvements 11,488 11,997
Buildings 54,232 53,510
Equipment 327,033 301,389
------- -------
392,753 366,896

Less accumulated depreciation 229,060 206,463
------- -------
Net property and equipment 163,693 160,433

Goodwill (Note 1) 36,147 33,259
Other intangible assets, net (Note 1) 38,456 34,798
Corporate life insurance investment pool 18,193 16,390
Deferred income taxes (Note 3) 1,756 -
Other assets (Note 9) 14,329 14,285
------- -------
Total assets $473,564 $ 474,738
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 38,685 $ 33,592
Accrued compensation 24,169 18,241
Customer service deposits 13,877 11,705
Accrued employee benefits (Note 2) 23,798 21,166
Other current liabilities 8,144 12,864
Current portion of long-term obligations 2,337 6,889
------- -------
Total current liabilities 111,010 104,457

Long-term obligations (Note 5) 1,524 2,762
Deferred income taxes (Note 3) - 1,189
Stockholders' equity (Note 6):
Common stock, $.25 par value; authorized
and issued 14,400,000 shares 3,600 3,600
Retained earnings 402,301 390,279
Treasury stock, at cost (Note 6) (44,871) (27,549)
------- -------
Total stockholders' equity 361,030 366,330
------- -------
Total liabilities and stockholders' equity $473,564 $ 474,738
======= =======

See accompanying notes.

<PAGE>

Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF EARNINGS
(Dollars in thousands, except
per share amounts) Years ended December 31
1996 1995 1994

Continuing operations
Operating revenue:
Publications
Advertising $210,244 $208,857 $ 198,214
Circulation 52,290 54,500 57,952
Other 2,349 3,791 5,137
Broadcast 95,690 74,623 63,445
Printing 203,477 202,556 151,853
Telecommunications 45,351 39,977 35,974
Direct marketing 14,890 11,578 7,799
Eliminations (2,057) (4,050) (2,793)
------- ------- -------
Total operating revenue 622,234 591,832 517,581

Operating costs and expenses:
Cost of sales 358,588 346,144 289,383
Selling and administrative
expenses 196,629 181,091 161,922
Merger and litigation charges
(Notes 4 & 8) - 23,218 -
------- ------- -------
Total operating costs
and expenses 555,217 550,453 451,305
------- ------- -------
Operating earnings 67,017 41,379 66,276

Other income (deductions):
Dividends and interest - net 3,366 4,806 1,669
Gain (loss) on sale of assets 308 46 (114)
------- ------- -------
Total other income
(deductions) 3,674 4,852 1,555
------- ------- -------
Earnings from continuing
operations before income
taxes 70,691 46,231 67,831

Provision for income taxes
(Note 3) 29,648 18,330 27,230
------- ------- -------
Earnings from continuing
operations 41,043 27,901 40,601
------- ------- -------
Discontinued operations
(Note 9)
Earnings, net of applicable
income taxes of $915 and $2,170 - 1,371 3,266
Gain on sale, net of applicable
income tax expense of $9,960 - 14,941 -
------- ------- -------
Net earnings $ 41,043 $ 44,213 $ 43,867
======= ======= =======
Earnings per share (Note 1):
Continuing operations $ 3.13 $ 2.01 $ 2.90
Discontinued operations .00 1.17 0.23
------- ------- -------
Net earnings per share $ 3.13 $ 3.18 $ 3.13
======= ======= =======

See accompanying notes.

<PAGE>

Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
Years ended December 31
CASH FLOWS 1996 1995 1994
Cash flow from operating activities:
Earnings from continuing
operations $ 41,043 $ 27,901 $ 40,601
Adjustments for non-cash items:
Depreciation and amortization 37,635 34,413 29,779
Deferred income taxes (2,052) (5,610) (400)
Net (gain) loss from sales
of assets (308) (46) 114
Change in:
Receivables 1,250 (15,892) (15,992)
Inventories 3,610 (5,414) (8,058)
Accounts payable 5,018 7,814 7,814
Other current assets and
liabilities of continuing
operations 8,638 22 5,429
------- ------- -------
Net cash provided by
operating activities 94,834 43,188 59,287

Cash flow from investing activities:
Proceeds from sales of assets 5,937 1,031 2,029
Property and equipment
expenditures (33,772) (33,406) (36,569)
Net (increase) decrease in
short-term investments 8,462 (22,398) 11,202
Assets of businesses acquired (17,000) (22,773) (12,697)
Other - net (3,421) (4,748) (5,189)
------- ------- -------
Net cash used for
investing activities (39,794) (82,294) (41,224)
------- ------- -------
Net cash provided by discontinued
operations (Note 9) - 82,831 7,193

Cash flow from financing activities:
Net decrease in long-term
obligations (7,015) (185) (732)
Net (purchases) sales of
treasury stock (17,212) (17,136) 2,651
Cash dividends (28,563) (29,156) (26,699)
------- ------- -------
Net cash used for
financing activities (52,790) (46,477) (24,780)
Net increase (decrease) in cash 2,250 (2,752) 476
Cash at beginning of year 10,133 12,885 12,409
------- ------- -------
Cash at end of year $ 12,383 $ 10,133 $ 12,885
======= ======= =======
Cash paid for income taxes $ 27,753 $ 47,557 $ 29,108
======= ======= =======

See accompanying notes.

<PAGE>
Consolidated Financial Statements

Consolidated Statements of Retained Earnings
(Dollars in thousands, except share and
per share amounts)
Years ended December 31
Retained Earnings 1996 1995 1994

Balance at beginning of year $390,279 $373,626 $ 355,879
Net earnings 41,043 44,213 43,867
Cash dividends (per share, 1996 -
$2.20, 1995 - $2.10, 1994 -
$1.90) (28,563) (29,156) (26,699)
Treasury stock transactions
(Note 6) 110 616 416
Currency translation
adjustment (568) 980 163
------- ------- -------
Balance at end of year $402,301 $390,279 $ 373,626
======= ======= =======

<PAGE>
Notes to Consolidated Financial Statements

DECEMBER 31, 1996, 1995 and 1994 (Dollars in thousands, except share and
per share amounts)

1. Principal accounting policies

Basis of consolidation - The consolidated financial statements include the
accounts of Journal Communications Inc. and its wholly owned subsidiaries
(collectively, the Company). All significant intercompany balances and
transactions have been eliminated.

Foreign currency translation - The Company's foreign subsidiary uses the
local currency as its functional currency. Accordingly, assets and
liabilities of the foreign subsidiary are translated into U.S. dollars at
year-end exchange rates, while income and expense items are translated at
the average exchange rates for the year. Resulting translation adjustments
are reflected in retained earnings.

Earnings per share - Earnings per share are based on the weighted average
shares outstanding during each period.

Short-term investments - Short-term investments, which consist of
commercial paper ($48,900) and bank certificates of deposit with
maturities of one year or less ($4,000), are stated at cost, which
approximates market value.

Receivables - Allowance for doubtful accounts at December 31, 1996 and
1995 was $3,242 and $2,476, respectively.

Inventories - Inventories are stated at the lower of cost (first in, first
out method) or market.

Inventories at December 31 consist of the following:

1996 1995

Paper and Supplies $ 16,596 $ 19,143
Work in Process 4,754 4,559
Finished Goods 6,328 7,590
------- -------
$ 27,678 $ 31,292
======= =======

Property and equipment - Depreciation of property and equipment is
computed principally using the straight-line method.

Goodwill - Goodwill resulting from acquisitions subsequent to November 1,
1970, is amortized on a straight-line basis over 40 years. Goodwill prior
to November 1, 1970, is amortized when it is determined that such
intangible assets have a limited useful life. At December 31, 1996, $3,095
of goodwill was not being amortized. Accumulated amortization at December
31, 1996 and 1995 was $9,942 and $9,567, respectively.

Other intangible assets - Identifiable intangible assets resulting from
acquisitions are amortized on a straight-line basis for periods up to 30
years. Accumulated amortization relating to other intangible assets at
December 31, 1996 and 1995 was $26,089 and $22,990, respectively. Other
intangible assets also include the costs of television program contracts,
recorded under the gross method, which are deferred and amortized over the
estimated number of runs of the related programs.

Use of estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the amounts reported in the
financial statements and accompanying notes. Actual results could differ
from those estimates.

2. Employee benefit plans

The Company has a defined benefit pension plan covering the majority of
its employees. The plan provides benefits based on compensation, years of
service and date of birth. The Company's policy is to fund the plan in
amounts that comply with contribution limits imposed by law.

Net pension cost for the defined benefit plan includes the following
components:

1996 1995 1994

Service cost $ 2,600 $ 2,068 $ 2,481
Interest on projected
benefit obligation 6,023 6,015 5,526
Return on plan assets -
(gain) loss (8,434) (10,644) 865
One time recognition
of costs related to
newspaper merger - 4,000 -

Net amortization and
deferral 2,539 4,860 (6,570)
------- ------- -------
Net pension cost $ 2,728 $ 6,299 $ 2,302
======= ======= =======

Actuarial assumptions used to project the benefit obligations and the net
pension cost were:

1996 1995 1994

Discount rate 7.75% 7.50% 8.00%
Rate of increase in
compensation levels 5.00% 5.00% 5.25%
Expected long-term rate of
return on plan assets 9.50% 9.50% 9.50%

The assets of the plan consist primarily of listed stocks and government
and other bonds.

The funded status of the plan at December 31 was as follows:

1996 1995

Actuarial present value of benefit
obligations:

Vested benefits $ 67,259 $ 67,428
Nonvested benefits 2,938 2,949
------- -------
Accumulated benefit
obligation 70,197 70,377
Effect of projected
compensation levels 13,192 13,396
------- -------
Projected benefit
obligation 83,389 83,773
Less: plan assets
at fair value 68,590 63,047
------- -------
Projected benefit obligation
in excess of plan assets 14,799 20,726
Unrecognized:
Transition asset 943 1,180
Prior service cost (2,544) (2,798)
Gain (loss) (2,892) (8,909)
------- -------
Accrued pension liability $ 10,306 $ 10,199
======= =======

The Journal Communications Inc. Investment Savings Plan is a defined
contribution benefit plan covering substantially all employees. The plan
allows employees to defer up to 15% of their eligible wages, up to the IRS
limit, on a pre-tax basis. In addition, employees can contribute up to 10%
of their eligible wages after taxes. Each employee who elects to
participate is eligible to receive company matching contributions. The
Company will contribute $0.50 for each dollar contributed by the
participant, up to 5% of eligible wages as defined by the plan. Company
matching contributions were $2,071, $1,952 and $1,824 in 1996, 1995 and
1994, respectively. The Company made additional contributions into the
Investment Savings Plan on behalf of certain employees not covered by the
Company's defined benefit pension plan of $731, $214 and $178 in 1996,
1995 and 1994, respectively.

In addition, the Company provides health benefits to certain retirees and
their eligible spouses. The majority of the plan costs are covered by the
Company. It is the Company's policy to fund the plan as claims are
incurred. The Company has elected to amortize the unfunded obligation of
$25,324 at January 1, 1993 over a period of 20 years.

Postretirement benefit expense includes the
following components:

1996 1995 1994

Service cost $ 496 $ 433 $ 572
Interest cost on
accumulated postretirement
benefit obligation 2,051 2,067 1,991
Amortization of
transition obligation 1,110 1,139 1,266
One time recognition
of costs related to
newspaper merger - 2,092 -
------- ------- -------
Postretirement
benefit expense $ 3,657 $ 5,731 $ 3,829
======= ======= =======

The funded status of the plan on an aggregate basis at December 31 was as
follows:

1996 1995
Accumulated postretirement benefit
obligation:
Retirees $ 19,465 $ 19,756
Fully eligible participants 1,463 855
Other active participants 6,729 7,859
------- -------
Total accumulated
postretirement benefit
obligation 27,657 28,470
Unrecognized actuarial
loss (340) (1,655)
Less: Unrecognized
transition obligation 17,761 18,871
------- -------
Accrued postretirement
benefit cost liability $ 9,556 $ 7,944
======= =======

The assumed health care cost trend rates used in measuring the accumulated
postretirement benefit obligation (APBO) for retirees for 1997 are 7.0%
grading down to 5.0% in 2001 and thereafter, and for 1996 were 8.0%
grading down to 5.0% in 2006 and thereafter. The benefit cost trend rates
have a significant effect on the amounts reported. The impact of a 1%
increase in the health care cost trend rates would have increased the APBO
6.0% at December 31, 1996, and would have increased the aggregate service
cost and interest cost components of the postretirement benefit expense by
7.9%. The weighted average discount rate used in determining the
accumulated postretirement benefit obligation was 7.75% and 7.5% for 1996
and 1995, respectively.

3. Income taxes

Income tax expense (benefit) attributable to income from
continuing operations consists of the following:

1996 1995 1994
Current
Federal $ 25,157 $ 18,670 $ 21,400
State 6,543 5,270 6,230
------- ------- -------
31,700 23,940 27,630

Deferred (2,052) (5,610) (400)
$ 29,648 $ 18,330 $ 27,230
======= ======= =======

The significant differences between the statutory federal tax rates and
the effective tax rates are as follows:

1996 1995 1994

Statutory federal
income tax rate 35.0% 35.0% 35.0%
State income taxes,
net of federal tax benefit 5.1 5.2 5.2
Foreign net operating
losses 1.7 0.4 0.5
Other 0.1 (1.0) (0.6)
---- ---- ----
Actual provision 41.9% 39.6% 40.1%
==== ==== ====

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and liabilities include:

1996 1995

Deferred tax assets:
Accrued compensation
and employee benefits $ 9,613 $ 9,520
Intangible assets 1,176 569
Inventories 459 390
Receivables 852 855
Domestic loss carryforwards 4,009 2,909
Foreign loss carryforwards 3,781 1,595
Other 1,068 540
------- -------
Total deferred tax assests 20,958 16,378

Deferred tax liabilities:
Property, plant and equipment 11,855 11,969
Other 1,222 -
------- -------
Total deferred tax liabilities 13,077 11,969

Valuation allowances:
Domestic loss carryforwards 618 418
Foreign loss carryforwards 1,694 474
------- -------
Total valuation allowances 2,312 892

Net deferred tax asset
included in balance sheet $ 5,569 $ 3,517
======= =======

4. Litigation and contingent liabilities

The Company is subject to various lawsuits and claims arising out of the
normal course of business. Management believes that such lawsuits and
claims will not materially affect the consolidated financial position of
the Company.

In November 1995, a judgment was issued against the Company for $8.4
million in connection with a patent infringement lawsuit. In February
1996, the judgment was settled for $5.7 million, which has been recorded
in fiscal 1995. The settlement fully relieves the Company of all past and
future obligations under this matter.

5. Long-term obligations
December 31
1996 1995

Note payable, 8%,
due June 1996 $ - $ 4,459
Capital lease & other obligations,
average interest 8% in 1996 1,420 1,510
Television program
contracts, due thru 1998 2,441 3,682
------- -------
3,861 9,651
Less current portion 2,337 6,889
------- -------
$ 1,524 $ 2,762
======= =======

In addition, the Company has the rights to broadcast certain television
programs during the years 1997-2001 under contracts aggregating $5,933.

Rental expense for office facilities and equipment including
noncancellable operating leases was $15,382, $10,548 and $6,821 in 1996,
1995 and 1994, respectively. Future minimum annual rental payments due
under operating leases total $33,138 and are due as follows: 1997 -
$5,694, 1998 - $4,119, 1999 - $3,207, 2000 - $3,003, 2001 - $2,470;
thereafter $14,645.

6. Stockholders' equity

The Company purchases units of beneficial interest in the Journal
Employees' Stock Trust (JESTA) for resale to its employees and for use in
its Incentive Compensation Plans. Treasury stock activity is as follows:

<TABLE>
<CAPTION>
1996 1995 1994
Units Amount Units Amount Units Amount

<S> <C> <C> <C> <C> <C> <C>
Beginning balance 758,582 $ 27,549 291,249 $ 9,797 366,574 $ 12,031
Purchases 1,380,440 50,504 699,608 25,488 52,500 1,834
Sales (912,205) (33,182) (232,275) (7,736) (127,825) (4,068)
--------- --------- -------- --------- -------- ---------
Ending balance 1,226,817 $ 44,871 758,582 $ 27,549 291,249 $ 9,797
========= ========= ======== ========= ======== =========
Gain on sales $ 110 $ 616 $ 417
========= ========= =========
</TABLE>

7. Acquisitions

On January 29, 1996, the Company acquired the business and substantially
all of the assets of KMXZ-FM, KKHG-FM and KFFN-AM in Tucson, Ariz. The
combined cash purchase price was approximately $16.2 million.

On January 24, 1995, and February 1, 1995, the Company acquired the
business and substantially all of the assets of KEZO-AM (renamed KOSR-AM),
KEZO-FM and KKCD-FM in Omaha, Neb. The combined cash purchase price was
approximately $12.7 million.

On June 22, 1995, the Company acquired the business and substantially all
of the assets of Mega Direct, a direct marketing company based in
Clearwater, Fla., at a purchase price of approximately $8 million.

The acquisitions were accounted for using the purchase method.
Accordingly, the operating results and cash flows of the acquired
businesses are included in the Company's consolidated financial statements
from the dates of acquisition. Had the Tucson radio stations been acquired
as of January 1, 1996, or had the Omaha radio stations and Mega Direct
been acquired as of January 1, 1995, the effect of the acquisitions on the
Company's consolidated results of operations, for each respective year,
would not have been material.

8. Merger charges

On April 2, 1995, Journal Sentinel Inc. merged The Milwaukee Journal and
the Milwaukee Sentinel into a morning newspaper called the Milwaukee
Journal Sentinel. This resulted in a pretax charge of $17.5 million, which
consisted of $11.3 million in termination benefits for approximately 250
employees and $6.2 million for other nonrecurring costs associated with
the launch of the new newspaper. All charges were recorded in fiscal 1995.

9. Discontinued operations

Effective April 27, 1995, the Company sold substantially all the assets
used in the business of its wholly owned subsidiary, Perry Printing
Corporation ("Perry"). Perry was a heatset web offset printer of long-run
catalogs and publications. The assets sold consisted of accounts
receivable, inventories, fixtures, equipment and certain real estate.

The Perry operations have been reflected as discontinued operations, and
accordingly, prior period financial statements have been restated to
reflect this treatment.

Net revenues of discontinued operations were $45,946 and $116,967 in 1995
and 1994, respectively.

The sale price was approximately $95 million, which included 115,000
shares of the buyer's preferred stock with a value of $11.5 million, plus
the assumption of trade and other liabilities by the buyer. In 1995, the
Company recorded an after tax gain on the sale of $14.9 million.

10. Segment analysis

Journal Communications Inc. is an employee-owned, diversified
communications company with operations in 17 states and France. The
Company's principal lines of business are publishing, broadcasting,
printing, telecommunications and direct marketing. The Milwaukee Journal
Sentinel and 76 paid and free periodicals are published. The broadcasting
business consisted of nine radio and three television stations.

The printing of short-run publications, periodicals, computer software
documentation manuals, quality labels, and packaging and promotional
materials are provided by the printing business. The telecommunications
business provides a full range of services with one of the largest digital
networks in the Midwest. Personalized direct marketing services are
provided to merchandisers and manufacturers.

<TABLE>
<CAPTION>
Sales Earnings
1996 1995 1994 1996 1995 1994

<S> <C> <C> <C> <C> <C> <C>
Publications $264,883 $ 267,148 $261,303 $ 33,940 $ 16,020 $ 43,998
Broadcast 95,690 74,623 63,445 31,600 19,644 14,589
Printing 203,477 202,556 151,853 (3,374) 8,124 3,477
Telecommunications 45,351 39,977 35,974 9,627 9,429 9,023
Direct marketing 14,890 11,578 7,799 1,681 (2,652) (1,487)
Corporate & eliminations (2,057) (4,050) (2,793) (6,457) (9,186) (3,324)
------- ------- ------- ------- ------- -------
$622,234 $ 591,832 $517,581 $ 67,017 $ 41,379 $ 66,276
------- ------- -------
Corporate - other income 3,674 4,852 1,555
------- ------- -------
Earnings from continuing operations
before income taxes $ 70,691 $ 46,231 $ 67,831
======= ======= =======

<CAPTION>
Identifiable total assets Depreciation Capital expenditures
1996 1995 1994 1996 1995 1994 1996 1995 1994

<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Publications $ 92,297 $ 94,106 $ 90,175 $ 6,510 $ 5,937 $ 5,393 $ 8,264 $ 8,303 $ 7,320
Broadcast 77,763 66,843 52,268 3,233 2,961 2,811 2,837 3,641 4,310
Printing 125,264 139,211 116,371 10,270 7,832 6,303 9,341 16,785 17,322
Telecom-
munications 58,943 55,216 61,172 7,473 7,446 7,265 12,341 2,612 6,404
Direct
marketing 16,127 19,471 9,214 1,070 829 629 594 1,594 923
Corporate &
eliminations 103,170 99,891 65,741 256 207 149 395 471 290
------- ------- ------- ------- ------- ------- ------- ------- -------
$473,564 $474,738 $394,941 $28,812 $25,212 $22,550 $ 33,772 $33,406 $ 36,569
======= ======= ======= ======= ======= ======= ======= ======= =======
</TABLE>

<PAGE>
Report of Ernst & Young LLP, Independent Auditors

The Board of Directors and Stockholders
Journal Communications Inc.

We have audited the accompanying consolidated balance sheets of Journal
Communications Inc. as of December 31, 1996 and 1995, and the related
consolidated statements of earnings, retained earnings, and cash flows for
each of the three years in the period ended December 31, 1996. These
financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Journal
Communications Inc. at December 31, 1996 and 1995, and the consolidated
results of its operations and its cash flows for each of the three years
in the period ended December 31, 1996, in conformity with generally
accepted accounting principles.

ERNST & YOUNG LLP

Milwaukee, Wisconsin
February 3, 1997

Exhibit No. 21

JOURNAL COMMUNICATIONS, INC.
Subsidiaries of the Registrant

The following list shows the subsidiaries of the Registrant, their
respective states of incorporation and the percentage of voting securities
of each subsidiary owned by its immediate parent. All companies listed
have been included in the consolidated financial statements filed
herewith.

Percent of Voting
Securities Owned
State/Country by Registrant or
Subsidiary of Incorporation Immediate Parent

Journal Sentinel Inc. Wisconsin 100% by Registrant
Journal Broadcast Group, Inc. Wisconsin 100% by Registrant
NorthStar Print Group, Inc. Wisconsin 100% by Registrant
ADD, Inc. Wisconsin 100% by Registrant
Norlight Telecommunications, Inc. Wisconsin 100% by Registrant
PrimeNet Marketing Services, Inc. Minnesota 100% by Registrant
Trumbull Printing, Inc. Connecticut 100% by Registrant
IPC Communication Services, Inc. Michigan 100% by Registrant
Hometown Publications, Inc. Connecticut 100% by ADD, Inc.
Label Products & Design, Inc. Wisconsin 100% by NorthStar
Print Group
PPC Liquidations, Inc. Wisconsin 100% by NorthStar
Print Group
Mega Direct, Inc. Wisconsin 100% by ADD, Inc.
Auto Mart Publications, Inc. Ohio 100% by ADD, Inc.
Nordoc Software Services, S. A. France 99% by Imperial
Printing*
_____________________________
* 1% by other subsidiaries of the Registrant

The Registrant has no controlling parent. Twelve million nine
hundred and sixty thousand (12,960,000) shares, or ninety percent (90%),
of the Registrant's issued common stock at December 31, 1996, are owned of
record by the Trust. The right to vote these shares in most instances
resides in the employees who hold units of beneficial interest in that
trust. Accordingly, the Registrant is not controlled by the Trust and
does not consider it to be a "parent" of the Registrant within the meaning
of Regulation 12b-2. See Item 12 "Security Ownership of Certain
Beneficial Owners and Management."

Exhibit No. 23

CONSENT OF ERNST & YOUNG, LLP, INDEPENDENT AUDITORS

We consent to the incorporation by reference in this Annual Report on
Form 10-K of Journal Communications, Inc. of our report dated February 3,
1997, included in the 1996 Annual Report to Shareholders of Journal
Communications, Inc.

Our audits also included the financial statement schedule of Journal
Communications, Inc. listed in item 14(a). This schedule is the
responsibility of the company's management. Our responsibility is to
express an opinion based on our audits. In our opinion, the financial
statement schedule referred to above, when considered in relation to the
basic financial statements taken as a whole, presents fairly in all material
respects the information set forth therein.

We also consent to the incorporation by reference in the Registration
Statements of Forms S-8 (File Nos. 2-79770, 33-14771 and 333-15669) pertain-
ing to the Journal Communications, Inc. Employes' Individual Retirement
Agreement, the Journal Employes' Stock Trust, and the Journal Communica-
tions, Inc. Employes' Stock Trust filing of November 5, 1996 with respect
to 1,500,000 units of beneficial interest in said trust, of our report dated
February 3, 1997 with respect to the consolidated financial statements and
schedule of Journal Communications, Inc. included and incorporated by
reference in the Annual Report (Form 10-K) for the year ended December 31,
1996.

Milwaukee, Wisconsin ERNST & YOUNG, LLP
March 31, 1997

<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF JOURNAL COMMUNICATIONS, INC. AS OF AND FOR THE
YEAR ENDED DECEMBER 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 12,383,371
<SECURITIES> 52,900,000
<RECEIVABLES> 93,414,616
<ALLOWANCES> 3,241,512
<INVENTORY> 27,678,334
<CURRENT-ASSETS> 200,990,180
<PP&E> 392,753,324
<DEPRECIATION> 229,059,745
<TOTAL-ASSETS> 473,564,282
<CURRENT-LIABILITIES> 111,010,134
<BONDS> 1,524,216
0
0
<COMMON> 3,600,000
<OTHER-SE> 361,029,931
<TOTAL-LIABILITY-AND-EQUITY> 473,564,282
<SALES> 225,965,552
<TOTAL-REVENUES> 622,233,567
<CGS> 0<F1>
<TOTAL-COSTS> 555,216,956
<OTHER-EXPENSES> (308,316)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (3,366,465)
<INCOME-PRETAX> 70,691,392
<INCOME-TAX> 29,648,000
<INCOME-CONTINUING> 41,043,392
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 41,043,382
<EPS-PRIMARY> 3.13
<EPS-DILUTED> 3.18
<FN>
<F1>Not separately reported.
</FN>

</TABLE>