SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 27, 1994
Commission file number 1-8572
TRIBUNE COMPANY
(Exact name of registrant as specified in its charter)
Delaware 36-1880355
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
435 North Michigan Avenue, Chicago, Illinois 60611
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 222-9100
No Changes
(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 (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 / /
At April 29, 1994 there were 67,367,779 shares outstanding of the
Company's Common Stock (without par value).
1
<PAGE>
Table of Contents for 10-Q
Page
Part I. FINANCIAL INFORMATION 3-14
Item 1. Financial Statements 3-7
Consolidated Statements of Income 3
Consolidated Statements of Financial Position 4
Consolidated Statements of Cash Flows 5
Notes to Financial Statements 6-7
Item 2. Management's Discussion and Analysis 8-13
Part II. OTHER INFORMATION 14-15
Item 4. Submission of Matters to a Vote of Security Holders 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 15
SIGNATURE 16
Exhibit 11 17
Exhibit 12 18
2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
---------------------
<TABLE>
<CAPTION> TRIBUNE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands of dollars, except per share data)
(Unaudited)
First Quarter Ended
---------------------------------
March 27, 1994 March 28, 1993
-------------- --------------
<S> <C> <C>
Operating revenues....................................... $ 482,822 $ 434,548
Operating expenses
Cost of sales (exclusive of
items shown below)................................... 241,845 239,418
Selling, general and administrative ..................... 130,024 111,044
Depreciation and amortization of intangible assets....... 26,351 24,985
--------- ---------
Total operating expenses................................. 398,220 375,447
--------- ---------
Operating profit......................................... 84,602 59,101
Equity in QUNO net loss.................................. (9,123) (2,711)
Interest income.......................................... 4,622 4,336
Interest expense......................................... (5,848) (8,115)
--------- ---------
Income before income taxes............................... 74,253 52,611
Income taxes............................................. (34,184) (22,960)
--------- ---------
Net income .............................................. 40,069 29,651
Preferred dividends, net of tax.......................... (4,644) (4,628)
--------- ---------
Net income attributable to common shares................. $ 35,425 $ 25,023
========= =========
Net income per share:
Primary $ .53 $ .38
========= =========
Fully diluted $ .49 $ .36
========= =========
Dividends per common share............................... $ .26 $ .24
========= =========
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION> TRIBUNE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(In thousands of dollars)
March 27, 1994 December 26, 1993
--------------- ------------------
<S> (Unaudited)
ASSETS <C> <C>
Current assets
Cash and short-term investments......................... $ 17,541 $ 18,524
Accounts receivable, net................................ 260,562 284,110
Inventories............................................. 34,598 26,290
Broadcast rights........................................ 165,930 144,233
Prepaid expenses and other.............................. 26,534 18,102
----------- -----------
Total current assets.................................... 505,165 491,259
----------- -----------
Investment in and advances to QUNO...................... 313,311 250,923
Property, plant and equipment........................... 1,251,706 1,201,167
Accumulated depreciation................................ (623,383) (599,552)
----------- -----------
Net properties.......................................... 628,323 601,615
----------- -----------
Broadcast rights........................................ 210,529 217,229
Intangible assets, net.................................. 799,215 719,965
Mortgage notes receivable from affiliates............... 83,836 119,437
Other................................................... 200,233 135,982
----------- -----------
Total assets............................................ $ 2,740,612 $ 2,536,410
=========== ===========
LIABILITIES AND STOCKHOLDERS' INVESTMENT
Current liabilities
Accounts payable........................................ $ 95,360 $ 85,334
Contracts payable for broadcast rights.................. 156,940 142,686
Accrued expenses and other current liabilities.......... 322,165 277,007
----------- -----------
Total current liabilities............................... 574,465 505,027
----------- -----------
Long-term debt.......................................... 493,787 510,838
Deferred income taxes................................... 141,684 87,605
Contracts payable for broadcast rights.................. 193,183 194,846
Other................................................... 142,014 142,467
----------- -----------
Total liabilities....................................... 1,545,133 1,440,783
----------- -----------
Stockholders' investment
Series B convertible preferred stock.................... 329,357 335,532
Common stock............................................ 1,018 1,018
Additional paid-in capital.............................. 107,239 105,819
Retained earnings....................................... 1,612,340 1,589,695
Treasury stock (at cost)................................ (598,021) (607,332)
Unearned compensation related to ESOP................... (298,969) (298,969)
Cumulative translation adjustment....................... (33,918) (30,136)
Unrealized gain on investments.......................... 76,433 -
----------- -----------
Total stockholders' investment.......................... 1,195,479 1,095,627
----------- -----------
Total liabilities and stockholders' investment.......... $ 2,740,612 $ 2,536,410
=========== ===========
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION> TRIBUNE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of dollars)
(Unaudited)
First Quarter Ended
------------------------------
March 27, 1994 March 28, 1993
-------------- --------------
<S> <C> <C>
Operations
Net income................................................... $ 40,069 $ 29,651
Adjustments to reconcile net income to net cash
provided by operations:
Equity in QUNO net loss.............................. 9,123 2,711
Depreciation and amortization of intangible
assets............................................. 26,351 24,985
Other, net........................................... 73,236 55,849
--------- ---------
Net cash provided by operations.............................. 148,779 113,196
--------- ---------
Investments
Capital expenditures......................................... (18,068) (23,086)
Acquisitions................................................. (93,927) (19,920)
Repayment of note receivable from QUNO....................... - 179,846
Purchase of mortgage note.................................... - (35,500)
Other, net................................................... (7,619) (7,683)
--------- ---------
Net cash provided by (used for) investments.................. (119,614) 93,657
--------- ---------
Financing
Repayments of long-term debt................................. (17,260) (200,656)
Sale of common stock to employees, net....................... 4,536 25,831
Dividends.................................................... (17,424) (15,828)
Redemption of preferred stock................................ - (3,905)
--------- ---------
Net cash used for financing.................................. (30,148) (194,558)
--------- ---------
Net increase (decrease) in cash and short-term investments... (983) 12,295
--------- ---------
Cash and short-term investments at the beginning of year..... 18,524 16,768
--------- ---------
Cash and short-term investments at the end of quarter........ $ 17,541 $ 29,063
========= =========
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
5
<PAGE>
TRIBUNE COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1:
- - ------
In the opinion of management, the accompanying unaudited condensed consolidated
financial statements contain all adjustments necessary to present fairly the
financial position of Tribune Company and its subsidiaries (the Company or
Tribune) as of March 27, 1994 and the results of their operations and their
cash flows for the quarters ended March 27, 1994 and March 28, 1993. All
adjustments reflected in the accompanying unaudited condensed consolidated
financial statements are of a normal recurring nature. Results of operations
for interim periods are not necessarily indicative of the results to be
expected for the full year. Certain prior year amounts have been reclassified
to conform with the 1994 presentation.
Note 2:
- - ------
Primary net income per share has been computed by dividing net income
attributable to common shares by the weighted average number of common shares
outstanding during the periods. Fully diluted net income per share has been
computed based on the assumption that all of the convertible preferred shares
have been converted into common shares. The numbers of common shares used for
computing primary and fully diluted net income per share were as follows (in
thousands):
First Quarter Ended
1994 1993
------ ------
Primary 67,085 65,790
Fully diluted 74,287 72,993
Note 3:
- - ------
On April 14, 1994, Tribune reduced its ownership holdings in QUNO Corporation
("QUNO") by selling 5.5 million shares of QUNO common stock. With this sale
Tribune reduced its ownership interest in QUNO from 59% to 34%. The sale of
the shares resulted in an after-tax gain of approximately $13 million, or $.19
per share, which will be recorded in the second quarter of 1994. The Company
retains 7.5 million shares of QUNO's 22 million common shares outstanding and
also holds a U.S. $138.8 million (face value) subordinated debenture,
convertible into 11.7 million voting common shares of QUNO.
6
<PAGE>
Note 4:
- - ------
Tribune acquired The Wright Group on February 18, 1994, for approximately $100
million in cash. The Wright Group is the leading publisher of "whole language"
educational materials for the elementary school market. On April 6, 1994,
Tribune completed the purchase of Boston independent television station WLVI
(Ch. 56) for approximately $25 million in cash. The acquisition increases the
number of Tribune-owned TV stations to eight, making Tribune Television the
nation's largest owned and operated station group in terms of total U.S.
household coverage at 24.15 percent. These acquisitions are being accounted
for by the purchase method, and accordingly, the results of operations of the
companies have been or will be included in the consolidated financial
statements since or from their respective dates of acquisition.
Note 5:
- - ------
The Company adopted Financial Accounting Standards Board Statement No. 115,
"Accounting for Certain Investments in Debt and Equity Securities", in the first
quarter of 1994. This statement generally requires that the Company record
investments in debt securities and publicly traded equity securities at their
market value, except for debt securities which the Company intends to hold to
maturity and equity securities which are accounted for using the equity method.
The market value of the Company's long-term investments in less-than-20% owned
publicly traded companies was approximately $52 million in excess of the invest-
ments' $10 million carrying value at March 27, 1994. The Company also holds a
$138.8 million (face value) convertible debenture issued by QUNO Corporation.
The market value of this debenture, based on the $25.25 Canadian quoted market
price per share of the underlying QUNO common stock at March 27, 1994, was
approximately $214 million. FAS 115 requires that changes in market value from
historical cost for these investments be reported, net of tax, in a separate
component of stockholders' investment until realized. The adoption of this
statement had no impact on net income, and prior year financial statements are
not restated.
Note 6:
- - ------
Financial data for each of the Company's business segments is as follows (in
thousands):
<TABLE>
<CAPTION> First Quarter Ended
-------------------------------
March 27, 1994 March 28, 1993
-------------- --------------
<S> <C> <C>
Operating revenues:
Publishing.............................................. $ 337,072 $ 294,583
Broadcasting and Entertainment.......................... 146,948 140,981
Intercompany............................................ (1,198) (1,016)
--------- ---------
Total operating revenues................................ $ 482,822 $ 434,548
========= =========
Operating profit (loss):
Publishing.............................................. $ 70,567 $ 55,729
Broadcasting and Entertainment.......................... 20,375 9,170
Corporate expenses...................................... (6,340) (5,798)
--------- ---------
Total operating profit.................................. $ 84,602 $ 59,101
========= =========
</TABLE>
7
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
---------------------------------------------------------------
Results of Operations.
----------------------
The following discussion compares the results of operations of Tribune Company
and its subsidiaries (the "Company") for the first quarter of 1994 to the first
quarter of 1993.
RESULTS OF OPERATIONS
- - ---------------------
The Company's results of operations, when examined on a quarterly basis,
reflect the seasonality of advertising, which affects the results of both
publishing and broadcasting and entertainment. Second and fourth quarter
advertising revenues are typically higher than first and third quarter
revenues. Results for the 1994 first quarter reflect this seasonal pattern.
CONSOLIDATED
The Company's consolidated operating results for the first quarters of
1994 and 1993 and the percentage change from 1993 were as follows:
(Dollars in millions, First Quarter
except per share amounts) 1994 1993 Change
------ ------ ------
Operating revenues $483 $435 +11%
Operating profit $ 85 $ 59 +43%
Equity in QUNO net loss $ (9) $ (3) -237%
Net income $ 40 $ 30 +35%
Primary net income per share $.53 $.38 +39%
Net Income Per Share -- Primary net income per share for the 1994 first quarter
rose 39% to $.53 from $.38 in 1993. This increase was due to higher operating
profit at both media groups and lower net interest expense, partially offset by
larger equity losses from QUNO.
Operating Profit and Revenues -- The Company's consolidated operating profit by
business segment for the first quarter was as follows:
(Dollars in millions) First Quarter
1994 1993 Change
------ ------ ------
Publishing $ 71 $ 56 +27%
Broadcasting & Entertainment 20 9 +122%
Corporate expenses (6) (6) + 9%
------ ------ ------
Total operating profit $ 85 $ 59 +43%
8
<PAGE>
Publishing reported a 27% increase in operating profit for the 1994 first
quarter due primarily to higher advertising revenues and, to a lesser extent,
contributions from three acquisitions - Contemporary Books in July 1993,
Compton's Multimedia in September 1993, and The Wright Group in February 1994.
Broadcasting and entertainment operating profit improved in the first quarter
due primarily to lower programming costs and increased television revenues.
Consolidated operating revenues for the 1994 first quarter rose 11% to
$483 million from $435 million. Publishing operating revenues increased 14%,
and broadcasting and entertainment revenues increased 4%.
Operating Expenses -- Consolidated operating expenses increased 6% for the
quarter as follows:
(Dollars in millions) First Quarter
1994 1993 Change
------ ------ ------
Cost of sales $242 $239 + 1%
Selling, general & administrative 130 111 +17%
Depreciation & amortization
of intangible assets 26 25 + 5%
------ ------ ------
Total operating expenses $398 $375 + 6%
Cost of sales increased only 1% in the 1994 first quarter as expenses of
the three publishing group acquisitions were largely offset by lower
programming costs and lower newsprint and ink expense. Excluding expenses of
the three publishing group acquisitions, cost of sales decreased 3% or $6
million, in the first quarter. Newsprint and ink expense decreased $2 million,
or 5%, and programming costs decreased $10 million, or 16%, while compensation
costs increased $4 million, or 6%. The increase in selling, general and
administrative expenses in 1994 was primarily attributable to the new
businesses acquired, higher compensation costs and increased sales costs.
Excluding the three new businesses, SG&A expenses increased $10 million as
compensation increased $2 million, or 4%, and sales costs rose $4 million. The
increase in depreciation and amortization of intangible assets reflects the
addition of the three acquisitions and capital expenditures made in 1993,
primarily at the Company's Chicago newspaper printing facility.
PUBLISHING
Operating Profit and Revenues -- Publishing operating profit for the 1994 first
quarter was $71 million, up 27% from $56 million. Operating margins for the
first quarter of 1994 increased to 20.9% from 18.9% in 1993.
Operating revenues for the quarter increased 14% to $337 million from $295
million in 1993 due to a 9% increase in newspaper advertising revenues and the
addition of the three recently acquired companies. Excluding these three
companies, publishing revenues increased $22 million, or 8 percent.
9
<PAGE>
Publishing group revenues by classification for the first quarter were as
follows:
First Quarter
(Dollars in millions) 1994 1993 Change
------ ------ ------
Advertising
Retail $105 $100 + 4%
General 35 30 + 17%
Classified 95 85 + 12%
------ ------ ------
Total advertising 235 215 + 9%
Circulation 63 63 -
Other 39 17 +127%
------ ------ ------
Total revenues $337 $295 + 14%
Retail advertising revenues for the 1994 quarter increased mainly due to
improvements reported in the department store and movie categories in Chicago,
and the furniture and department store categories in Fort Lauderdale. General
advertising revenues for the quarter increased due principally to gains in the
transportation, hi-tech, utilities and financial categories in Chicago.
Classified advertising revenues for the quarter rose mainly due to increased
help wanted and automotive advertising in Chicago and Florida.
Advertising linage for 1994 increased in all categories due to the
generally improved advertising climate. The increase in preprint advertising
linage is mainly due to increased retail part run preprints. The following
summary presents advertising linage for the first quarter:
First Quarter
(Inches in thousands) 1994 1993 Change
------ ------ ------
Full run
Retail 1,078 1,019 + 6%
General 179 154 +16%
Classified 1,731 1,616 + 7%
------ ------ ------
Total full run 2,988 2,789 + 7%
Part run 2,548 2,433 + 5%
Preprint 2,299 2,044 +12%
------ ------ ------
Total inches 7,835 7,266 + 8%
Circulation revenues were basically unchanged in the 1994 first quarter.
Total average daily circulation decreased 2% to 1,402,000 copies in the first
quarter, while total average Sunday circulation decreased 1% to 2,098,000
copies.
10
<PAGE>
Other revenues are derived from publishing books and information in print
and digital formats; advertising placement services; the syndication of
columns, features, information and comics to newspapers; commercial printing
operations; direct mail operations; and other publishing-related activities.
The increase in other revenues in the 1994 first quarter resulted mainly from
the 1993 acquisitions of Contemporary Books in late July and Compton's in mid-
September and the 1994 acquisition of The Wright Group in February. Excluding
these acquisitions, other revenues increased 11% reflecting higher revenues
from direct mail and advertising placement services.
Operating Expenses -- Publishing operating expenses increased 12%, or $28
million, in the first quarter of 1994. Excluding the three new acquisitions,
operating expenses increased 4%, or $9 million. The increase was mainly due to
a $3 million, or 3%, increase in compensation costs and a $2 million, or 7%,
increase in circulation costs for expanding total market coverage volume in
Chicago. These increases were partially offset by a $2 million, or 5%, decline
in newsprint and ink expense. Newsprint prices declined 11% for the quarter,
while newsprint and ink consumption increased 6%.
BROADCASTING AND ENTERTAINMENT
Operating Profit and Revenues -- Broadcasting and entertainment operating
profit for the first quarter of 1994 was $20 million, up 122% from $9 million
in 1993. The increased operating profit was mainly due to lower programming
costs and higher television revenues.
Operating revenues for the group for the 1994 and 1993 first quarters
were as follows:
First Quarter
(Dollars in millions) 1994 1993 Change
------ ------ ------
Television $118 $112 + 5%
Radio 10 10 + 4%
Entertainment 19 19 - 2%
------ ------ ------
Total revenues $147 $141 + 4%
Television revenues for the first quarter of 1994 increased largely due to
gains at WGN-Chicago and WPIX-New York. Television revenues declined at KTLA-
Los Angeles due to the continued unfavorable market conditions in Southern
California. Radio revenues increased in 1994, primarily due to higher revenues
at WGN-Chicago and at the Denver radio stations. Entertainment revenues
decreased due partly to the cancellation of "The Joan Rivers Show," which has
been replaced with "Can We Shop Starring Joan Rivers," of which Tribune has an
equity interest.
11
<PAGE>
Operating Expenses -- Operating expenses for the group decreased 4%, or $5
million, in the first quarter. The decrease was principally due to a $10
million, or 16%, decrease in programming costs, offset partially by higher
compensation costs of $3 million, or 8%, and start-up losses for new projects
such as "The Road" and Television Food Network. The decrease in programming
costs was due to the airing of lower cost programs at the television stations
and a reduction in production costs due to a lower level of original
programming at Tribune Entertainment. The increase in compensation was
primarily due to increased compensation at the television stations.
EQUITY IN QUNO NET LOSS
The Company's equity in QUNO's first quarter net loss, after interest
expense and taxes, was $9 million in 1994 and $3 million in 1993.
QUNO reported an operating loss of $15 million for the first quarter of
1994, compared to a $.4 million operating loss for the 1993 first quarter.
QUNO's increased operating loss was due to lower revenues, resulting from lower
newsprint selling prices, and non-cash foreign currency exchange losses due to
the weaker Canadian dollar. First quarter 1994 average newsprint selling
prices fell 11% while shipments increased 2%, compared to 1993's first quarter.
QUNO incurred a pretax foreign currency exchange loss of $10 million in the
1994 first quarter, compared to a gain of $2 million in 1993.
On April 14, 1994, the Company reduced its ownership holdings in QUNO by
selling 5.5 million shares of QUNO common stock. With this sale, the Company
reduced its ownership interest in QUNO from 59% to 34%. The sale of the shares
resulted in an after-tax gain of approximately $13 million, or $.19 per share,
which will be recorded in the second quarter of 1994. The Company retains 7.5
million shares of QUNO's 22 million common shares outstanding and also holds a
U.S. $138.8 million (face value) subordinated debenture, convertible into 11.7
million voting common shares of QUNO.
INTEREST INCOME AND EXPENSE
Interest income increased 7% to $5 million for the first quarter of 1994
primarily due to the QUNO $138.8 million convertible debenture held by Tribune.
Interest expense decreased 28% to $6 million in the quarter due to lower debt
levels primarily as a result of the QUNO initial public offering in February
1993.
INCOME TAX EXPENSE
The Company's effective income tax rate, excluding equity in QUNO losses,
declined in the 1994 first quarter to 41.0% from 41.5%.
12
<PAGE>
FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
- - ----------------------------------------------------
Net cash provided by operations for the first quarter of 1994 was $149
million compared to $113 million in the first quarter of 1993. The increase
was due primarily to higher net income and changes in working capital. Net cash
used for investments was $120 million for the first quarter of 1994 compared to
$94 million provided by investments for the corresponding 1993 period. The 1994
first quarter included the acquisition of The Wright Group in February 1994 for
approximately $100 million in cash and capital expenditures of $18 million. On
April 6, 1994, (in the second quarter), Tribune completed the purchase of
independent television station WLVI-Boston (Ch. 56) for approximately $25
million in cash. These acquisitions were financed with available cash. The
1993 period included intercompany debt repayments of $180 million received from
QUNO as a result of its initial public offering and debt issuances. In March,
1994, Tribune contributed to a partnership in which it had a 50% interest, the
$35 million mortgage note it held on a building owned by the partnership. This
increased the Company's ownership interest in the partnership to 99%. The
partnership's financial statements are consolidated in Tribune's consolidated
financial statements since the date of the mortgage note contribution. Capital
expenditures for fiscal year 1994 are expected to total approximately $90
million, related to a variety of modernization and normal replacement projects.
Net cash used for financing activities in the 1994 first quarter was $30
million compared to $195 million in 1993. Net cash used for financing
activities in 1994 included debt repayment of $17 million and dividends of $17
million. The first quarter 1994 dividend increased 8% to $.26 per share from
$.24 per share. Net cash used for financing activities in 1993 included a $201
million net reduction in debt primarily funded from the proceeds received from
the QUNO stock offering.
The Company expects to fund capital expenditures, dividends and other
operating requirements for the remainder of 1994 primarily with net cash
provided by operations.
13
<PAGE>
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders.
---------------------------------------------------
(a) The Company held its annual meeting of stockholders on April 19, 1994.
(b) No answer required.
(c) Proposal 1 involved the election of five directors to serve until the
1997 Annual Meeting. Those directors and the voting results are as
follows:
Votes Votes Votes
"For" "Not For" "Abstained"
----- --------- -----------
James C. Dowdle 61,882,002 825,754 --
Diego E. Hernandez 61,226,108 1,481,648 --
Robert E. La Blanc 61,309,029 1,398,727 --
John W. Madigan 61,852,051 855,705 --
Andrew J. McKenna 61,878,819 828,937 --
Proposal 2 involved the approval of an amendment to the 1992 Long-Term
Incentive Plan.
Votes Votes Votes
"For" "Not For" "Abstained"
----- --------- -----------
59,463,824 2,488,407 531,597
Proposal 3 involved the ratification of the selection of Price
Waterhouse to serve as the Company's independent certified public
accountants for 1994.
Votes Votes Votes
"For" "Not For" "Abstained"
----- --------- -----------
62,165,001 464,168 78,587
(d) Not applicable.
Item 5. Other Information.
-------------------
The computation of the ratios of earnings to fixed charges, filed
herewith as Exhibit 12, is incorporated herein by reference.
14
<PAGE>
Item 6. Exhibits and Reports on Form 8-K.
---------------------------------
(a) Exhibits.
11 - Statements of computation of primary and fully
diluted net income per share.
12 - Computation of ratios of earnings to fixed charges.
(b) Reports on Form 8-K.
The Company filed a report on Form 8-K dated March 25, 1994, which
included Items 5 and 7, reporting on the agreement to sell 5.5 million shares
of QUNO Corporation common stock. No financial statements were filed as part
of the report.
15
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRIBUNE COMPANY
(Registrant)
Date: May 10, 1994 R. Mark Mallory
Vice President and Controller
(on behalf of the Registrant
and as chief accounting officer)
16
<PAGE>
Exhibit 11
<TABLE>
<CAPTION> TRIBUNE COMPANY
STATEMENTS OF COMPUTATION OF PRIMARY AND FULLY DILUTED
NET INCOME PER SHARE (UNAUDITED)
(In thousands, except per share amounts)
First Quarter Ended
March 27, 1994 March 28, 1993
<S> -------------- --------------
PRIMARY <C> <C>
- - -------
Net income $40,069 $29,651
Preferred dividends, net of tax (4,644) (4,628)
--------- ---------
Net income attributable to common shares $35,425 $25,023
--------- ---------
Weighted average common shares outstanding 67,085 65,790
--------- ---------
Primary net income per share $ .53 $ .38
========= =========
FULLY DILUTED
- - -------------
Net income $40,069 $29,651
Additional ESOP contribution required assuming
all preferred shares were converted, net of tax (2,980) (3,169)
Assumed elimination of tax benefit on certain ESOP
preferred dividends (705) (547)
--------- ---------
Adjusted net income $36,384 $25,935
--------- ---------
Weighted average common shares outstanding 67,085 65,790
Assumed conversion of preferred shares into common shares 6,011 6,126
Assumed exercise of stock options, net of common
shares assumed repurchased with the proceeds 1,191 1,077
--------- ---------
Adjusted weighted average common shares outstanding 74,287 72,993
--------- ---------
Fully diluted net income per share $ .49 $ .36
========= =========
</TABLE>
17
<PAGE>
Exhibit 12
<TABLE>
<CAPTION> TRIBUNE COMPANY
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
(In thousands, except ratios)
First Quarter Full Year
Ended ---------------------------------------------------------
3/27/94 1993 1992 1991 1990 1989
---------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net income (loss) before cumulative effects of
accounting changes $40,069 $188,606 $136,625 $141,981 ($63,533) $242,421
Add:
Income tax expense (benefit) 34,184 143,821 96,266 99,894 (30,695) 168,463
Loss on less than 50%-owned equity investments 11,866 20,212 1,903 1,107 2,285 2,221
---------- --------- --------- --------- --------- ---------
Sub total 86,119 352,639 234,794 242,982 (91,943) 413,105
---------- --------- --------- --------- --------- ---------
Fixed charge adjustments
Add:
Interest expense 5,848 24,660 49,254 63,083 53,576 47,866
Amortization of capitalized interest 578 2,392 5,304 5,258 4,850 4,098
Interest component of rental expense (A) 2,180 8,732 9,329 9,047 14,467 12,333
---------- --------- --------- --------- --------- ---------
Earnings (loss), as adjusted $94,725 $388,423 $298,681 $320,370 ($19,050) $477,402
========== ========= ========= ========= ========= =========
Fixed charges:
Interest expense $ 5,848 $24,660 $ 49,254 $ 63,083 $ 53,576 $ 47,866
Interest capitalized - 1,099 3,445 1,976 8,652 13,614
Interest component of rental expense (A) 2,180 8,732 9,329 9,047 14,467 12,333
Interest related to guaranteed ESOP debt (B) 6,406 25,742 27,019 27,500 27,757 20,508
---------- --------- --------- --------- --------- ---------
Total fixed charges $14,434 $60,233 $ 89,047 $101,606 $104,452 $ 94,321
========== ========= ========= ========= ========= =========
Ratio of Earnings to Fixed Charges 6.6 6.4 3.4 3.2 (C) 5.1
---------- --------- --------- --------- --------- ---------
(A) Represents a portion of rental expense incurred by the Company, which is a reasonable approximation of the interest cost
component of such expense.
(B) Tribune Company guarantees the debt of its Employee Stock Ownership Plan (ESOP).
(C) The net loss for 1990 reflects an after-tax non-recurring loss of $185 million ($295 million before income taxes)
relating to the sale of the New York Daily News. Excluding this non-recurring item, the ratio for 1990 was 2.6. As a
result of the loss incurred for the full-year 1990, the Company was unable to cover the indicated fixed charges. The
Company's loss, as adjusted, plus the indicated fixed charges for 1990 totaled $124 million.
</TABLE>
18
