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 September 29, 1996
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 November 4, 1996 there were 61,592,062 shares outstanding of the
Company's Common Stock (without par value).
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
---------------------
TRIBUNE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands of dollars, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Third Quarter Ended Three Quarters Ended
-------------------------------- -------------------------------
Sept. 29, 1996 Sept. 24, 1995 Sept. 29, 1996 Sept. 24, 1995
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Operating revenues.................................... $618,327 $552,244 $1,797,376 $1,650,868
Operating expenses
Cost of sales (exclusive of items
shown below)....................................... 303,948 295,644 901,873 851,300
Selling, general and administrative................... 160,286 142,797 443,727 409,852
Depreciation and amortization
of intangible assets............................... 37,780 30,680 103,515 90,048
-------- -------- ---------- ----------
Total operating expenses.............................. 502,014 469,121 1,449,115 1,351,200
-------- -------- ---------- ----------
Operating profit...................................... 116,313 83,123 348,261 299,668
Dispositions of subsidiary stock and investment....... - (7,500) - 7,772
Interest income....................................... 7,700 4,098 24,075 10,620
Interest expense...................................... (12,692) (5,651) (34,680) (14,534)
-------- -------- ---------- ----------
Income from continuing operations before
income taxes........................................ 111,321 74,070 337,656 303,526
Income taxes.......................................... (45,085) (29,998) (136,751) (122,928)
-------- -------- ---------- ----------
Income from continuing operations..................... 66,236 44,072 200,905 180,598
Discontinued operations of QUNO, net of tax........... - 11,828 89,317 25,392
-------- -------- ---------- ----------
Net income............................................ 66,236 55,900 290,222 205,990
Preferred dividends, net of tax....................... (4,697) (4,622) (14,090) (13,865)
-------- -------- ---------- ----------
Net income attributable to common shares.............. $ 61,539 $ 51,278 $ 276,132 $ 192,125
======== ======== ========== ==========
Net income per share:
Primary: Continuing operations................ $ 1.00 $ .61 $ 3.04 $ 2.55
Discontinued operations.............. - .18 1.46 .39
------ ------ ------ ------
Net income........................... $ 1.00 $ .79 $ 4.50 $ 2.94
====== ====== ====== ======
Fully diluted: Continuing operations................ $ .92 $ .56 $ 2.79 $ 2.36
Discontinued operations.............. - .17 1.31 .35
------ ------ ------ ------
Net income........................... $ .92 $ .73 $ 4.10 $ 2.71
====== ====== ====== ======
Dividends per common share............................ $ .30 $ .28 $ .90 $ .84
====== ====== ====== ======
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
2
<PAGE>
TRIBUNE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of dollars)
<TABLE>
<CAPTION>
September 29, 1996 December 31, 1995
------------------ -----------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets
Cash and short-term investments.................................... $ 14,040 $ 22,899
Accounts receivable, net........................................... 365,723 296,363
Inventories........................................................ 76,804 45,348
Broadcast rights................................................... 163,002 163,339
Prepaid expenses and other......................................... 22,967 17,651
---------- ----------
Total current assets............................................... 642,536 545,600
Investment in and advances to QUNO................................. - 356,925
Property, plant and equipment...................................... 1,433,592 1,366,741
Accumulated depreciation........................................... (793,487) (725,995)
---------- ----------
Net properties..................................................... 640,105 640,746
Broadcast rights................................................... 188,993 194,038
Intangible assets, net............................................. 1,243,092 795,856
Investments........................................................ 601,738 549,735
Mortgage note receivable from affiliate............................ 82,006 82,599
Other.............................................................. 123,342 122,756
---------- ----------
Total assets....................................................... $3,521,812 $3,288,255
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Long-term debt due within one year................................. $ 29,301 $ 28,665
Contracts payable for broadcast rights............................. 177,891 164,443
Deferred income ................................................... 44,238 43,961
Income taxes....................................................... 38,346 8,401
Accounts payable, accrued expenses and other current liabilities... 318,891 311,683
---------- ----------
Total current liabilities.......................................... 608,667 557,153
Long-term debt..................................................... 896,553 757,437
Deferred income taxes.............................................. 193,918 223,756
Contracts payable for broadcast rights............................. 234,120 225,771
Compensation and other obligations................................. 135,215 144,229
---------- ----------
Total liabilities.................................................. 2,068,473 1,908,346
Shareholders' equity
Series B convertible preferred stock............................... 312,470 322,540
Common stock and additional paid-in capital........................ 138,713 127,814
Retained earnings.................................................. 2,156,071 1,930,380
Treasury stock (at cost)........................................... (1,019,893) (923,828)
Unearned compensation related to ESOP.............................. (245,532) (247,281)
Cumulative translation adjustment.................................. - (19,188)
Unrealized gain on investments..................................... 111,510 189,472
---------- ----------
Total shareholders' equity......................................... 1,453,339 1,379,909
---------- ----------
Total liabilities and shareholders' equity......................... $3,521,812 $3,288,255
========== ==========
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
3
<PAGE>
TRIBUNE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
Three Quarters Ended
----------------------------------------
Sept. 29, 1996 Sept. 24, 1995
-------------- --------------
<S> <C> <C>
Operations
Net income................................................................... $ 290,222 $ 205,990
Adjustments to reconcile net income to net cash
provided by operations:
Discontinued operations of QUNO, net of tax.......................... (89,317) (25,392)
Dispositions of subsidiary stock and investment...................... - (7,772)
Depreciation and amortization of intangible assets................... 103,515 90,048
Other, net........................................................... (100,824) 13,774
--------- ---------
Net cash provided by operations.............................................. 203,596 276,648
--------- ---------
Investments
Capital expenditures......................................................... (61,338) (72,355)
Acquisitions................................................................. (505,707) (39,817)
Investments.................................................................. (60,000) (46,856)
Proceeds from dispositions of subsidiary stock and investment................ - 32,729
Proceeds from sale of QUNO................................................... 426,828 -
Other, net................................................................... 8,905 5,953
--------- ---------
Net cash used for investments................................................ (191,312) (120,346)
--------- ---------
Financing
Proceeds from issuance of long-term debt, net................................ 149,945 90,000
Repayments of long-term debt................................................. (11,262) (9,102)
Sale of common stock to employees, net....................................... 28,058 35,836
Purchase of treasury stock................................................... (123,353) (187,903)
Dividends.................................................................... (64,531) (64,080)
Redemption of preferred stock................................................ - (5,967)
--------- ---------
Net cash used for financing.................................................. (21,143) (141,216)
--------- ---------
Net increase (decrease) in cash and short-term investments................... (8,859) 15,086
Cash and short-term investments at the beginning of year..................... 22,899 21,824
--------- ---------
Cash and short-term investments at the end of quarter........................ $ 14,040 $ 36,910
========= =========
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
4
<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 September 29, 1996 and the results of their
operations for the quarters and first three quarters ended September 29, 1996
and September 24, 1995 and cash flows for the first three quarters ended
September 29, 1996 and September 24, 1995. 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 1996 presentation.
The condensed consolidated financial statements should be read in conjunction
with the consolidated financial statements and the related notes included in the
Company's Annual Report on Form 10-K.
Note 2:
- -------
Inventories consist of (in thousands):
Sept. 29, 1996 Dec. 31, 1995
-------------- -------------
Finished goods................... $49,195 $21,638
Newsprint (at LIFO).............. 17,199 12,473
Supplies and other............... 10,410 11,237
------- -------
Total inventories................ $76,804 $45,348
======= =======
Newsprint inventories are valued under the LIFO method and were less than
current cost by approximately $13.8 million at September 29, 1996 and $12.8
million at December 31, 1995. Finished goods primarily include books and
supplementary educational materials.
Note 3:
- -------
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):
Third Quarter Three Quarters
------------------- ------------------
1996 1995 1996 1995
------ ------ ------ ------
Primary.................. 61,234 64,865 61,360 65,285
Fully diluted............ 68,081 71,782 68,255 72,007
5
<PAGE>
Note 4:
- -------
In March 1996, Tribune completed the sale of its holdings in QUNO
Corporation, a Canadian newsprint company, as part of QUNO's merger with Donohue
Inc. The sale resulted in a 1996 after-tax gain of $89.3 million, or $1.46 per
share on a primary basis. The gross proceeds from the sale were approximately
$427 million in cash, Donohue stock and short-term notes. Immediately after the
sale, the Company sold the Donohue stock and notes for cash. After-tax proceeds
were approximately $331 million. QUNO has been accounted for as a discontinued
operation in the Company's consolidated financial statements.
In July 1995, Tribune sold Times Advocate Company, a California newspaper
subsidiary, for approximately $16 million in cash. The sale resulted in a pretax
loss of $7.5 million and an after-tax loss of $4.5 million, or $.07 per share on
a primary basis. In March 1995, Tribune sold shares of America Online common
stock for approximately $17 million. The sale resulted in a pretax gain of $15.3
million and an after-tax gain of $9.1 million, or $.14 per share on a primary
basis.
Note 5:
- -------
In January 1996, Tribune acquired Houston television station KHTV for
approximately $102 million in cash. In February 1996, Tribune acquired the
remaining minority interest in Philadelphia television station WPHL for
approximately $23 million in cash. In March 1996, Tribune acquired Educational
Publishing Corporation and NTC Publishing Group. Educational Publishing,
purchased for approximately $200 million in cash, publishes supplemental
education and innovative curriculum materials for early childhood through high
school learners. NTC Publishing was acquired for approximately $82 million in
cash and publishes educational products in print, audio and multimedia formats
for the foreign language learning, English as a second language, language arts,
careers, business and travel markets. In April 1996, the Company acquired San
Diego television station KSWB (formerly KTTY) for approximately $71 million in
cash.
In July 1996, Tribune announced an agreement to acquire Renaissance
Communications Corp., a publicly traded company owning six televisions stations,
for approximately $1.1 billion in cash. The transaction is subject to various
closing conditions, including FCC and other regulatory approval, and is expected
to close in early 1997.
The 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 6:
- -------
In October 1996, Tribune received $83 million as prepayment of a mortgage
note receivable from an affiliate. Tribune held the mortgage note on a building
in which the Company had an equity interest.
In the second quarter of 1996, the Company filed a shelf registration and
prospectus supplement with the Securities and Exchange Commission relating to
the offer and sale from time to time of up to $500 million principal amount of
the Company's Series D medium-term notes. Proceeds from the issuance of such
notes are expected to be used for general corporate purposes, including the
funding of acquisitions. On November 5, 1996, the Company sold $250 million
principal amount under the shelf registration. The notes have an interest rate
of 6 7/8% and mature in 2006.
6
<PAGE>
Note 7:
- -------
Financial data for each of the Company's business segments is as follows
(in thousands):
<TABLE>
<CAPTION>
Third Quarter Ended Three Quarters Ended
--------------------------------- --------------------------------
Sept. 29, 1996 Sept. 24, 1995 Sept. 29, 1996 Sept. 24, 1995
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Operating revenues:
Publishing.................................... $322,784 $304,686 $ 980,612 $ 956,020
Broadcasting and Entertainment................ 222,905 217,031 663,380 614,373
Education..................................... 72,638 30,527 153,384 80,475
-------- -------- ---------- ----------
Total operating revenues............................ $618,327 $552,244 $1,797,376 $1,650,868
======== ======== ========== ==========
Operating profit:
Publishing.................................... $ 60,989 $ 52,186 $ 197,093 $ 197,982
Broadcasting and Entertainment................ 41,449 35,058 136,377 116,806
Education..................................... 21,839 3,215 37,810 6,721
Corporate expenses............................ (7,964) (7,336) (23,019) (21,841)
-------- -------- ---------- ----------
Total operating profit.............................. $116,313 $ 83,123 $ 348,261 $ 299,668
======== ======== ========== ==========
</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 third quarter and first three
quarters of 1996 to the third quarter and first three quarters of 1995.
SIGNIFICANT EVENTS
- ------------------
In March 1996, Tribune completed the sale of its holdings in QUNO
Corporation, a Canadian newsprint company, as part of QUNO's merger with Donohue
Inc. The sale resulted in a 1996 after-tax gain of $89.3 million, or $1.46 per
share on a primary basis. The gross proceeds from the sale were approximately
$427 million in cash, Donohue stock and short-term notes. Immediately after the
sale, the Company sold the Donohue stock and notes for cash. After-tax proceeds
were approximately $331 million. QUNO has been accounted for as a discontinued
operation in the Company's consolidated financial statements.
The Company has acquired several businesses since the beginning of 1995.
In 1995, the Company purchased Jamestown Publishers, Inc. in May and Everyday
Learning Corporation in August. In 1996, the Company acquired Houston television
station KHTV in January, Educational Publishing Corporation and NTC Publishing
Group in March and San Diego television station KSWB (formerly KTTY) in April.
The results of these businesses have been included in the consolidated financial
statements since their respective dates of acquisition.
In March 1995, the Company sold shares of America Online common stock for
approximately $17 million. The sale resulted in an after-tax gain of $9.1
million, or $.14 per share on a primary basis. In July 1995, the Company sold
its California newspaper subsidiary, Times Advocate Company in Escondido, for
approximately $16 million in cash. The sale resulted in an after-tax loss of
$4.5 million, or $.07 per share. In December 1995, the Company sold Compton's
NewMedia to The Learning Company, Inc. (formerly SoftKey International Inc.) for
$120.5 million of The Learning Company common shares and a $3 million note and
also invested $150 million in The Learning Company convertible notes. These
transactions resulted in an after-tax gain of $4.1 million, or $.06 per share.
In July 1996, Tribune announced an agreement to acquire Renaissance
Communications Corp., a publicly traded company owning six televisions stations,
for approximately $1.1 billion in cash. The transaction is subject to various
closing conditions, including FCC and other regulatory approval, and is expected
to close in early 1997.
8
<PAGE>
RESULTS OF OPERATIONS
- ---------------------
The results of operations, when examined on a quarterly basis, reflect the
seasonality of the Company's revenues. In both publishing and broadcasting and
entertainment, second and fourth quarter advertising revenues are typically
higher than first and third quarter revenues. In education, second and third
quarter revenues are typically higher than first and fourth quarter revenues.
Results for the 1996 and 1995 third quarters reflect these seasonal patterns.
CONSOLIDATED
The Company's consolidated operating results for the third quarter and
first three quarters of 1996 and 1995 were as follows:
<TABLE>
<CAPTION>
(Dollars in millions, Third Quarter Three Quarters
except per share amounts) ------------------------- --------------------------
1996 1995 Change 1996 1995 Change
---- ---- ------ ------ ----- ------
<S> <C> <C> <C> <C> <C> <C>
Operating revenues $618 $552 + 12% $1,797 $1,651 + 9%
Operating profit 116 83 + 40% 348 300 + 16%
Dispositions of subsidiary stock and investment - (7) - - 8 -
Income from continuing operations 66 44 + 50% 201 181 + 11%
Discontinued operations of QUNO, net of tax - 12 - 89 25 *
Net income 66 56 + 18% 290 206 + 41%
Continuing operations before dispositions 66 49 + 36% 201 176 + 14%
Primary net income per share
Continuing operations 1.00 .61 + 64% 3.04 2.55 + 19%
Discontinued operations - .18 - 1.46 .39 *
Total 1.00 .79 + 27% 4.50 2.94 + 53%
Continuing operations before dispositions 1.00 .68 + 47% 3.04 2.48 + 23%
*Not meaningful
</TABLE>
Net Income Per Share -- Primary net income per share from continuing operations
for the 1996 third quarter was $1.00, up 47% from $.68 last year, excluding the
non-recurring loss in 1995 on the sale of Times Advocate Company. For the first
three quarters of 1996, primary net income per share from continuing operations
increased 23% to $3.04 from $2.48 in 1995, excluding the two non-recurring items
in 1995, the sales of Times Advocate Company and America Online common stock.
The improvements were due to solid gains in all three business segments for the
third quarter, and to higher operating profit from broadcasting and
entertainment as well as from education for the first three quarters. Fewer
shares outstanding also contributed to the higher per share earnings. Average
common shares outstanding decreased 6% in both the 1996 third quarter and first
three quarters due to the Company's stock repurchases.
Operating Profit and Revenues -- The Company's consolidated operating revenues,
EBITDA (earnings before gain/loss on stock sales, interest, taxes, depreciation
and amortization) and operating profit by business segment for the third quarter
and first three quarters were as follows:
9
<PAGE>
<TABLE>
<CAPTION>
Third Quarter Three Quarters
-------------------------- ----------------------------
(Dollars in millions) 1996 1995 Change 1996 1995 Change
---- ---- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Operating revenues
Publishing $323 $305 + 6% $ 981 $ 956 + 3%
Broadcasting and Entertainment 223 217 + 3% 663 614 + 8%
Education 72 30 +138% 153 81 + 91%
---- ---- ------ ------
Total operating revenues $618 $552 + 12% $1,797 $1,651 + 9%
EBITDA*
Publishing $ 82 $ 71 + 16% $ 255 $ 253 + 1%
Broadcasting and Entertainment 53 44 + 20% 171 144 + 18%
Education 26 5 +372% 47 13 +254%
Corporate expenses (7) (7) - (21) (21) -
---- ---- ------ -----
Total EBITDA $154 $113 + 35% $ 452 $ 389 + 16%
Operating profit
Publishing $ 61 $ 52 + 17% $ 197 $ 198 -
Broadcasting and Entertainment 41 35 + 18% 136 117 + 17%
Education 22 3 +579% 38 7 +463%
Corporate expenses (8) (7) - 9% (23) (22) - 5%
---- ---- ------ ------
Total operating profit $116 $ 83 + 40% $ 348 $ 300 + 16%
</TABLE>
* EBITDA is defined as earnings before gain/loss on stock sales, interest,
taxes, depreciation and amortization. The Company has presented EBITDA
because it is comparable to the data provided by other companies in the
industry and is a common alternative measure of performance. EBITDA does not
represent cash provided by operating activities as reflected in the
Company's consolidated statements of cash flows, is not a measure of
financial performance under generally accepted accounting principles
("GAAP") and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with GAAP.
Consolidated operating revenues for the 1996 third quarter rose 12% to
$618 million from $552 million in 1995 and for the first three quarters
increased 9% to $1.8 billion from $1.7 billion in 1995. The increases were due
to recent acquisitions and higher advertising revenues. Excluding businesses
recently acquired or sold, operating revenues were up 3% for the third quarter
and up 4% for the first three quarters.
Consolidated operating profit increased 40% in the 1996 third quarter and
16% in the first three quarters, while EBITDA increased 35% in the third quarter
and 16% in the first three quarters. Publishing operating profit increased 17%
in the 1996 third quarter and was flat for the first three quarters primarily
due to improved results at the Company's four daily newspapers, offset by
increased spending for development of Internet and online related businesses.
Broadcasting and entertainment operating profit increased in both periods of
1996 due to improvements at the Chicago Cubs, which was impacted by last year's
strike-shortened season. Education's 1996 third quarter operating profit was $22
million, compared with $3 million in 1995, and its first three quarters
operating profit was $38 million, up from $7 million in 1995, due mainly to the
recent acquisitions. Excluding businesses recently acquired or sold,
consolidated operating profit was up 14% in the third quarter and up 4% for the
first three quarters; EBITDA was up 14% in the third quarter and up 5% in the
first three quarters.
10
<PAGE>
Operating Expenses -- Consolidated operating expenses increased 7% for both the
quarter and the first three quarters as follows:
<TABLE>
<CAPTION>
Third Quarter Three Quarters
---------------------- ------------------------
(Dollars in millions) 1996 1995 Change 1996 1995 Change
---- ---- ------ ----- ---- ------
<S> <C> <C> <C> <C> <C> <C>
Cost of sales $304 $296 + 3% $ 902 $ 851 + 6%
Selling, general & administrative 160 143 + 12% 444 410 + 8%
Depreciation & amortization
of intangible assets 38 30 + 23% 103 90 + 15%
---- ---- ------ ------
Total operating expenses $502 $469 + 7% $1,449 $1,351 + 7%
</TABLE>
Cost of sales increased 3%, or $8 million, in the 1996 third quarter and
6%, or $51 million, in the first three quarters. Excluding the acquisitions and
dispositions, cost of sales decreased 3%, or $9 million, in the third quarter
and increased 3%, or $23 million, in the first three quarters. The decrease in
the third quarter was due primarily to lower newsprint and ink expense and Cubs
player compensation. Newsprint and ink expense was down $9 million, or 14%, in
the 1996 third quarter. The increase in the first three quarters was due
primarily to higher television broadcast rights amortization and newsprint and
ink expense. Excluding the two new television stations, television broadcast
rights amortization increased 9%, or $13 million, due to higher syndicated
programming and baseball rights amortization. Newsprint and ink expense rose $4
million, or 2%. Selling, general and administrative expenses were up $17
million, or 12%, in the 1996 third quarter and increased $34 million, or 8%, in
the first three quarters, primarily due to the acquisitions and increased losses
from equity investments and expenses for development activities. Excluding the
acquisitions and dispositions, SG&A expense increased $8 million, or 6%, in the
third quarter and increased $21 million, or 5% in the first three quarters.
Expenses for development activities and losses from equity investments increased
$8 million in the 1996 third quarter and rose $18 million in the first three
quarters. The increase in depreciation and amortization of intangible assets
reflects the acquisitions and capital expenditures made in 1996 and 1995.
PUBLISHING
Operating Profit and Revenues -- The following tables and discussion exclude
Times Advocate Company, which was sold in July 1995, unless otherwise noted. The
following table presents publishing operating revenues, EBITDA and operating
profit for daily newspapers and other publications/services/development. The
latter category includes syndication of editorial products, advertising
placement services, niche publications, delivery of other publications, direct
mail operations, online/electronic products and, for EBITDA and operating
profit, equity losses from investments.
11
<PAGE>
<TABLE>
<CAPTION>
Third Quarter Three Quarters
------------------------- -----------------------
(Dollars in millions) 1996 1995 Change 1996 1995 Change
---- ---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
Operating revenues
Daily newspapers $305 $289 + 6% $929 $900 + 3%
Other publications/
services/development 18 16 + 9% 52 47 + 10%
---- ---- ---- ----
Total operating revenues $323 $305 + 6% $981 $947 + 3%
EBITDA
Daily newspapers $ 90 $ 71 + 27% $272 $255 + 6%
Other publications/
services/development (8) - * (17) (1) *
---- ---- ---- ----
Total EBITDA $ 82 $ 71 + 16% $255 $254 -
Operating profit
Daily newspapers $ 70 $ 53 + 30% $217 $203 + 6%
Other publications/
services/development (9) (1) - 599% (20) (4) - 349%
---- ---- ---- ----
Total operating profit $ 61 $ 52 + 17% $197 $199 - 1%
*Not meaningful
</TABLE>
Publishing operating revenues for the 1996 third quarter were up 6% to
$323 million, and for the first three quarters were up 3% to $981 million, due
principally to higher advertising and circulation revenues. Operating profit for
the 1996 third quarter was up 17% to $61 million due to a 30% increase from the
four daily newspapers, partially offset by increased spending for development of
Internet and online related businesses. For the first three quarters, publishing
operating profit was down 1% to $197 million as a 6% increase in the daily
newspapers was more than offset by increased spending for development of
Internet and online related businesses. In the third quarter of 1996, daily
newspaper operating profit margins increased to 18.9% from 17.1% in 1995 and in
the first three quarters decreased to 20.1% from 21.0% in 1995. Including Times
Advocate, operating revenues were up 3% for the first three quarters and
operating profit was flat.
Publishing group revenues by classification were as follows:
<TABLE>
<CAPTION>
Third Quarter Three Quarters
----------------------------- ----------------------------
(Dollars in millions) 1996 1995 Change 1996 1995 Change
---- ---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
Advertising
Retail $ 98 $101 - 4% $302 $312 - 3%
General 32 26 + 21% 100 93 + 7%
Classified 118 106 + 12% 350 324 + 8%
---- ---- ---- ----
Total advertising 248 233 + 6% 752 729 + 3%
Circulation 62 60 + 4% 190 181 + 4%
Other 13 12 + 9% 39 37 + 6%
---- ---- ---- ----
Total revenues $323 $305 + 6% $981 $947 + 3%
</TABLE>
12
<PAGE>
Retail advertising revenues for the 1996 third quarter and first three
quarters decreased mainly due to declines in the department store, food and
drug, hardware store and electronics categories in Chicago. Several major
Chicago retailers went out of business in the fourth quarter of 1995. Classified
advertising revenues in both periods improved due principally to increased help
wanted advertising in all four markets.
Total advertising linage decreased 2% in the 1996 third quarter and was
down 3% for the first three quarters. Full run retail advertising linage
decreased 6% in the third quarter and was down 9% in the first three quarters
due to decreases at all of the newspapers except Orlando, which was up for the
quarter. Full run general linage increased 19% in the third quarter and 8% in
the first three quarters primarily due to increases at Chicago, Fort Lauderdale
and Newport News. Part run advertising linage was down 3% for the first three
quarters due primarily to decreases in Chicago and Orlando in retail and
classified. Preprint advertising linage decreased 2% in the 1996 third quarter
and was down 4% in the first three quarters due primarily to lower preprint part
run linage in Orlando and Newport News and decreased full run linage in Fort
Lauderdale and Chicago. The following summary presents advertising linage for
the third quarter and first three quarters:
<TABLE>
<CAPTION>
Third Quarter Three Quarters
------------------------------ ------------------------------
(Inches in thousands) 1996 1995 Change 1996 1995 Change
----- ----- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Full run
Retail 831 885 - 6% 2,572 2,813 - 9%
General 179 150 + 19% 541 500 + 8%
Classified 1,577 1,637 - 4% 4,844 4,925 - 2%
----- ----- ------ ------
Total full run 2,587 2,672 - 3% 7,957 8,238 - 3%
Part run 2,294 2,285 - 7,002 7,219 - 3%
Preprint 1,931 1,978 - 2% 5,698 5,916 - 4%
----- ----- ------ ------
Total inches 6,812 6,935 - 2% 20,657 21,373 - 3%
</TABLE>
Circulation revenues increased 4% in both the 1996 third quarter and first
three quarters due to selected price increases at all of the Company's
newspapers. Total average daily circulation was down 2% to 1,238,000 copies in
the 1996 third quarter, and total average Sunday circulation was down 3% to
1,869,000 copies. For the first three quarters of 1996, total average daily
circulation decreased 2% to 1,290,000 copies, while total average Sunday
circulation was down 2% to 1,928,000 copies.
Other revenues are derived from advertising placement services; the
syndication of columns, features, information and comics to newspapers;
commercial printing operations; delivery of other publications; direct mail
operations; and other publishing-related activities.
Operating Expenses -- Publishing operating expenses increased 4%, or $9 million,
in the third quarter of 1996 due to a $9 million increase in investments in and
costs associated with the development of Internet and online related businesses,
higher compensation expense and increased depreciation and amortization. These
increases were partially offset by a decline in newsprint and ink expense of
14%, or $9 million, as average newsprint prices were down 10% and consumption
declined 5%. Excluding development of new businesses, compensation expense
increased $3 million for the third quarter and depreciation and amortization
increased $2 million. For the first three quarters of 1996, operating expenses
increased 5%, or $36 million, due to a $16 million increase in development
spending and a $5 million, or 3%, increase in newsprint and ink expense. Average
newsprint prices rose 10% while consumption decreased 7% in the first three
quarters.
13
<PAGE>
BROADCASTING AND ENTERTAINMENT
Operating Profit and Revenues -- The following table presents operating
revenues, EBITDA and operating profit for television, radio,
entertainment/Chicago Cubs and cable programming/development. Cable
programming/development includes CLTV News and, for EBITDA and operating profit,
the Company's equity income or loss from The WB Network, TV Food Network and
Qwest Broadcasting.
<TABLE>
<CAPTION>
Third Quarter Three Quarters
--------------------------- ---------------------------
(Dollars in millions) 1996 1995 Change 1996 1995 Change
---- ---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
Operating revenues
Television $159 $150 + 5% $503 $455 + 10%
Radio 22 20 + 11% 67 66 + 3%
Entertainment/Chicago Cubs 40 45 - 11% 87 88 - 1%
Cable Programming/Development 2 2 + 16% 6 5 + 16%
---- ---- ---- ----
Total operating revenues $223 $217 + 3% $663 $614 + 8%
EBITDA
Television $ 45 $ 46 - 4% $162 $155 + 4%
Radio 3 2 + 61% 12 11 + 13%
Entertainment/Chicago Cubs 10 1 + 742% 8 (12) *
Cable Programming/Development (5) (5) + 8% (11) (10) - 14%
---- ---- ---- ----
Total EBITDA $ 53 $ 44 + 20% $171 $144 + 18%
Operating profit
Television $ 35 $ 38 - 9% $134 $134 -
Radio 2 1 + 119% 10 9 + 10%
Entertainment/Chicago Cubs 9 1 + 951% 4 (15) *
Cable Programming/Development (5) (5) + 8% (12) (11) - 12%
---- ---- ---- ----
Total operating profit $ 41 $ 35 + 18% $136 $117 + 17%
*Not meaningful
</TABLE>
The Major League Baseball players' contract expired on December 31, 1993.
The Major League Baseball Players Association initiated a strike on August 12,
1994, and on August 28, 1994 the owners canceled the remainder of the 1994 Major
League Baseball season. In April 1995, the National Labor Relations Board
invalidated the owners' posted rules, and the players ended their strike. The
1995 baseball season began April 26, 1995. The strike shortened the 1995 season
by 18 games, all in the second quarter, and impacted attendance throughout the
season. Negotiations for a new players' contract are continuing.
Broadcasting and entertainment operating revenues increased 3% to $223
million in the 1996 third quarter and increased 8% to $663 million in the first
three quarters due mainly to increases in television. Television revenues
increased in both periods primarily due to the acquisition of stations KHTV in
Houston and KSWB in San Diego and to improvements in New York, Denver and, for
the first three quarters, Chicago. Excluding the two new stations, television
revenues were flat in the third quarter and increased 5% in the first three
quarters.
14
<PAGE>
Third quarter 1996 operating profit for broadcasting and entertainment was
up 18% to $41 million from $35 million in 1995 and for the first three quarters
was up 17% to $136 million from $117 million in 1995. The increases were
primarily due to improvements at the Chicago Cubs, Tribune Entertainment and in
radio. The third quarter improvement was partially offset by a 9% decrease in
television operating profit primarily due to the adverse impact of the Olympics
on ratings and station national revenues. Chicago Cubs results were negatively
impacted in 1995 by the baseball strike, which delayed the season start and
impacted attendance throughout the 1995 season. Tribune Entertainment improved
in both periods due to the cancellation of the "Charles Perez" syndicated
program.
Operating Expenses -- Broadcasting and entertainment operating expenses were
flat in the 1996 third quarter and increased 6%, or $30 million, in the first
three quarters. In the third quarter, expenses from KHTV and KSWB were offset by
lower Cubs player compensation and lower expenses at Tribune Entertainment due
to the cancellation of "Charles Perez" and "The Road." The increase in operating
expenses in the first three quarters was primarily due to the acquisition of
KHTV and KSWB and a 9%, or $13 million, increase in television broadcast rights
amortization, partially offset by the lower expense at Tribune Entertainment due
to the cancellation of the two shows. Excluding the acquisitions, broadcasting
and entertainment operating expenses were down 5%, or $8 million, in the third
quarter and were up 2%, or $9 million, in the first three quarters.
EDUCATION
Operating Profit and Revenues -- The following table and discussion excludes
Compton's NewMedia, which was sold in December 1995, unless otherwise noted. The
following table presents operating revenues, EBITDA and operating profit for the
education segment:
<TABLE>
<CAPTION>
Third Quarter Three Quarters
-------------------------- -------------------------
(Dollars in millions) 1996 1995 Change 1996 1995 Change
---- ---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
Operating revenues $72 $25 + 186% $153 $58 + 164%
EBITDA 26 9 + 171% 47 19 + 149%
Operating profit 22 8 + 165% 38 15 + 145%
</TABLE>
Education operating revenues were up 186% to $72 million in the third
quarter and rose 164% to $153 million in the first three quarters primarily due
to the acquisitions of Everyday Learning, Educational Publishing and NTC
Publishing. Excluding the acquisitions and Compton's, revenues were up 3% in the
third quarter and 8% in the first three quarters. Including Compton's, operating
revenues increased 138% in the 1996 third quarter and were up 91% for the first
three quarters.
Education third quarter operating profit was $22 million, up $14 million
from $8 million in 1995. In the first three quarters of 1996, operating profit
was $38 million, up $23 million from $15 million in 1995. The improvements were
due to the acquisitions. Including Compton's, operating profit increased $19
million in the third quarter and $31 million for the first three quarters.
15
<PAGE>
Operating Expenses -- Education operating expenses were up 197%, or $33 million,
in the third quarter of 1996 and increased 171%, or $72 million, in the first
three quarters, primarily due to the recent acquisitions. Excluding the
acquisitions and Compton's, operating expenses were up 13%, or $2 million, in
the third quarter and 16%, or $6 million, in the first three quarters due to
higher sales volume and increased compensation costs. Including Compton's,
operating expenses increased 86% for the third quarter and 57% for the first
three quarters.
OTHER
Interest expense for the 1996 third quarter increased 125% to $13 million
and for the first three quarters increased 139% to $35 million due to higher
debt levels resulting from the acquisitions and stock repurchases. Interest
income increased 88% to $8 million in the 1996 third quarter and increased 127%
to $24 million in the first three quarters due mainly to The Learning Company
and Qwest Broadcasting convertible debentures held by Tribune. The effective tax
rate was 40.5% in both the third quarter and first three quarters of 1996 and
1995.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Cash flow generated from operations is the Company's primary source of
liquidity. Net cash provided by operations in the first three quarters was $204
million in 1996 and $277 million in 1995. The reduction was mainly due to the
payment of taxes on the sale of QUNO and changes in working capital. The Company
normally expects to fund dividends, capital expenditures and other operating
requirements with net cash provided by operations. Funding required for share
repurchases, acquisitions and investments is financed by available cash flow
from operations and, if necessary, by the issuance of debt or stock.
Net cash used for investments totaled $191 million in the first three
quarters of 1996 as the Company spent $566 million for acquisitions and
investments, including KHTV, Educational Publishing, NTC Publishing, KSWB, the
remaining minority interest in WPHL and Digital City, Inc. In the first three
quarters of 1996, capital spending totaled $61 million. The Company received
$427 million of gross proceeds in 1996 from the sale of QUNO Corporation.
Net cash used for financing activities in the 1996 first three quarters
was $21 million, as proceeds from the issuance of long-term debt and commercial
paper and the sale of stock to employees were offset by purchases of treasury
stock, dividends and repayments of debt. In the first three quarters of 1996,
the Company issued $120 million of medium-term notes, increased commercial paper
borrowings by $30 million and repurchased 1.9 million shares of its common stock
for $123 million. At September 29, 1996, the Company had authorization to
repurchase an additional 2.8 million shares but does not expect to repurchase
any more shares in 1996. The 1996 common dividend increased 7% to $.90 per share
for the first three quarters from $.84 per share in 1995.
In the second quarter of 1996, the Company filed a shelf registration
and prospectus supplement with the Securities and Exchange Commission relating
to the offer and sale from time to time of up to $500 million principal amount
of the Company's Series D medium-term notes. Proceeds from the issuance of such
notes are expected to be used for general corporate purposes, including the
funding of
16
<PAGE>
acquisitions. On November 5, 1996, the Company sold $250 million principal
amount under the shelf registration. The notes have an interest rate of 6 7/8%
and mature in 2006.
In July 1996, Tribune announced an agreement to acquire Renaissance
Communications Corp., a publicly traded company owning six televisions stations,
for approximately $1.1 billion in cash. The transaction is subject to various
closing conditions, including FCC and other regulatory approval, and is expected
to close in early 1997. In the third quarter of 1996, Tribune's debt ratings
were downgraded due to the anticipated financing of this acquisition. The rating
changes are not likely to significantly restrict the Company's ability to borrow
funds or materially affect the cost of those funds. A portion of the $250
million of proceeds from the November 5, 1996 sale of notes will be applied
towards the financing of the Renaissance transaction. Tribune expects to finance
the remainder of the acquisition with medium to long-term borrowings and
commercial paper.
In October 1996, Tribune received $83 million as prepayment of a mortgage
note receivable from an affiliate. Tribune held the mortgage note on a building
in which the Company had an equity interest.
17
<PAGE>
PART II. OTHER INFORMATION
Item 5. Other Information.
------------------
The computation of the ratios of earnings to fixed charges, filed
herewith as Exhibit 12, is incorporated herein by reference.
Item 6. Exhibits and Reports on Form 8-K.
---------------------------------
(a) Exhibits.
10.19 - Tribune Company Amended and Restated 1995 Nonemployee
Director Stock Option Plan, dated October 22, 1996.
10.20 - Tribune Company Amended and Restated Employee Stock
Purchase Plan, dated October 22, 1996.
10.21 - Tribune Company Amended and Restated 1996
Nonemployee Director Stock Compensation Plan, dated
October 22, 1996.
11 - Statements of computation of primary and fully
diluted net income per share.
12 - Computation of ratios of earnings to fixed charges.
27 - Financial data schedule.
(b) Reports on Form 8-K.
The Company filed four reports on Form 8-K during the quarter
for which this report is filed.
o The Company filed a Form 8-K Current Report dated July 9,
1996, which reported under Item 5 an agreement and plan of
merger with Renaissance Communications Corp. No financial
statements were filed as part of the report.
o The Company filed a Form 8-K Current Report dated July 26,
1996, which reported under Item 7 the financial statements
of Renaissance Communications Corp. for the year ended
December 31, 1995 and for the quarter ended March 31, 1996,
as well as the unaudited pro forma condensed consolidated
balance sheet of Tribune Company as of March 31, 1996 and
the unaudited pro forma condensed consolidated income
statements of Tribune Company for the fiscal year ended
December 31, 1995 and the quarter ended March 31, 1996 to
reflect all completed or pending acquisitions and
dispositions.
18
<PAGE>
o The Company filed a Form 8-K/A (dated July 26, 1996) on
August 2, 1996 which amended and supplemented the Form 8-K
dated July 26, 1996. The Form 8-K/A reported under Item 7
the financial statements of Renaissance Communications Corp.
for the quarter ended June 30, 1996.
o The Company filed a Form 8-K/A-2 (dated July 26, 1996) on
August 14, 1996 which amended and supplemented the Form 8-K
dated July 26, 1996. The Form 8-K/A-2 reported under Item 7
the unaudited pro forma condensed consolidated balance sheet
of Tribune Company as of June 30, 1996 and the unaudited pro
forma condensed consolidated statements of income for
Tribune Company for the fiscal year ended December 31, 1995
and the first half ended June 30, 1996 to reflect all
completed or pending acquisitions and dispositions.
19
<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: November 8, 1996 /s/ R. Mark Mallory
-------------------
R. Mark Mallory
Vice President and Controller
(on behalf of the Registrant
and as Chief Accounting Officer)
20
TRIBUNE COMPANY
1995 NONEMPLOYEE DIRECTOR STOCK OPTION PLAN
(As Amended and Restated Effective October 22, 1996)
ARTICLE I
GENERAL
1.1 Purpose. Tribune Company, a Delaware corporation (the "Company"), hereby
adopts this 1995 Nonemployee Director Stock Option Plan (the "Plan"). The
purpose of the Plan is to increase the stock ownership of nonemployee directors,
to further align their interests with those of the Company's other stockholders
and to foster and promote the long-term financial success of the Company by
attracting and retaining outstanding nonemployee directors by enabling them to
participate in the Company's growth through automatic, nondiscretionary grants
of Options (as defined in Article II).
1.2 Participation. Only directors of the Company who at the time a grant is made
are not employees of the Company or any subsidiary of the Company ("Directors")
shall receive grants under the Plan.
1.3 Shares Subject to The Plan. Shares of stock covered by grants under the Plan
may be in whole or in part authorized and unissued or treasury shares of the
Company's common stock or such other shares as may be substituted pursuant to
Section 3.2 ("Common Stock"). The maximum number of shares of Common Stock which
may be issued for all purposes under the Plan shall be 100,000 (subject to
adjustment pursuant to Section 3.2). Any shares of Common Stock subject to an
Option which for any reason is cancelled or terminated, without having been
exercised, shall again be available for grants under the Plan.
ARTICLE II
STOCK OPTIONS
2.1 Grant of Stock Options. Effective on the date of each annual meeting of the
stockholders of the Company at which Directors are elected ("Annual Meeting")
commencing with the Annual Meeting in 1995, each Director in office on
adjournment of said meeting will automatically be awarded a non-qualified stock
option (an "Option") under the Plan to purchase 1,000 (subject to adjustment
pursuant to Section 3.2) shares of Common Stock. The Options are not intended to
qualify as "incentive stock options" under Section 422 of the Internal Revenue
Code of 1986, as amended.
2.2 Stock Option Certificates. The grant of an Option shall be evidenced
by a Notice of Grant and Terms Sheet executed by an officer of the Company.
2.3 Option Price. The purchase price of Common Stock under each Option (the
"Option Price") granted shall be the Fair Market Value of the Common Stock as of
the date of the Annual Meeting.
1
<PAGE>
2.4 Exercise and Term of Options.
(a) Options may be exercised by the delivery of written notice of exercise
and the Option Price for the shares to be purchased to the Corporate Secretary
of the Company. The Option Price shall be paid in cash (including check, bank
draft or money order) or, unless in the opinion of counsel to the Company to do
so may result in a possible violation of law, by delivery of Common Stock
already owned by the Director for at least six months valued at Fair Market
Value on the date of exercise. As soon as practicable after receipt of each
notice and full payment, the Company shall deliver to the Director a certificate
or certificates representing the acquired shares of Common Stock.
(b) Each Option shall become exercisable beginning six months and one day
after the date it is granted and may be exercised at any time until (subject to
Section 3.1) the first to occur of the tenth anniversary of the date such Option
was granted or the third anniversary of the date the Director ceases to be a
Director (whether by death, disability, retirement or resignation). In the event
of the death of a former Director prior to the exercise of any Options which
were then exercisable, such Options may be exercised as provided in Section 3.1
until the third anniversary of the date the former Director ceased to be a
Director; provided, that Options not exercisable on the day a person ceases to
be a Director for any reason shall be cancelled.
ARTICLE III
MISCELLANEOUS PROVISIONS
3.1 Nontransferability; Beneficiaries. Options granted under the Plan shall
generally be nontransferable by the Director otherwise than by will or, if the
Director dies intestate, by the laws of descent and distribution. All grants
shall be exercisable during the Director's lifetime only by the Director or his
personal representative. Notwithstanding the foregoing, at the discretion of the
Board of Directors or the Governance and Compensation Committee (if it qualifies
under Rule 16b-3 as a nonemployee director committee), an Option granted under
the Plan may be transferable to members of the Director's immediate family or
trusts or family partnerships for the benefit of such persons, subject to such
terms and conditions as may be established by the Board of Directors or the
Committee. In the event of a Director's death prior to the exercise of any
Options which were then exercisable, such Options may be exercised by the
Director's beneficiary, designated as provided below, or, in the absence of any
such designation, the Director's estate for the period indicated in Section
2.4(b) above. Each Director may name, from time to time, any beneficiary or
beneficiaries (who may be named contingently or successively) who may exercise
such Options and receive such certificates. Each designation will revoke all
prior designations by such Director, and will be effective only when filed by
the Director during the Director's lifetime with the Corporate Secretary.
3.2 Adjustments Upon Certain Changes. If any of the events described in Sections
4.4(a) or (b) of the Company's 1992 Long-Term Incentive Plan shall occur, the
number of shares authorized by the Plan, the number of shares covered by
Outstanding Options and the Option Prices specified therein shall be
automatically adjusted on the same basis to give the proper
2
<PAGE>
effect to such change so as to prevent the dilution or enlargement of rights
under Options. In the event fractional shares would otherwise result from any
such adjustment, the number of shares so authorized and covered and the Option
Prices thereof shall be further adjusted so as to eliminate such fractions.
3.3 Amendment, Suspension and Termination of Plan. The Board of Directors may
suspend or terminate the Plan or any portion thereof at any time and may amend
it from time to time in such respects as the Board of Directors may deem
advisable in order that any grants thereunder shall conform to or otherwise
reflect any change in applicable laws or regulations, or to permit the Company
or the Directors to enjoy the benefits of any change in applicable laws or
regulations, or in any other respect the Board of Directors may deem to be in
the best interests of the Company; provided, however, that no such amendment
shall, without stockholder approval to the extent required by law, agreement or
the rules of any exchange upon which the Common Stock is listed (a) except as
provided in Section 3.2, materially increase the number of shares of Common
Stock which may be issued under the Plan, (b) materially modify the requirements
as to eligibility for participation in the Plan, or (c) materially increase the
benefits accruing to Directors under the Plan. No such amendment, suspension, or
termination shall impair the rights of Directors under any outstanding Options
without the consent of the Directors affected thereby.
3.4 Definition of Fair Market Value. The term "Fair Market Value" unless
otherwise required by any applicable provision of the Code or any regulations
issued thereunder shall mean, as of any date, the closing price of the Common
Stock as reported on the New York Stock Exchange Composite Transactions List (or
such other consolidated transaction reporting system on which the Common Stock
is primarily trade) for such day, or if the Common Stock was not traded on such
day, then the next preceding day on which the stock was traded, all as reported
by such source as the Board of Directors may select. If the Common Stock is not
readily tradeable on a national securities exchange or other market system, its
Fair Market Value shall be set under procedures established by the Board of
Directors on the advice of an investment advisor.
3.5 Plan Not Exclusive. The adoption of the Plan shall not preclude the
adoption by appropriate means of any other stock option or other incentive plan
for Directors.
3.6 Listing, Registration and Legal Compliance. Each Option shall be subject to
the requirement that if at any time counsel to the Company shall determine that
the listing, registration or qualification thereof or of any shares of Common
Stock or other property subject thereto upon any securities exchange or under
any foreign, federal or state securities or other law or regulation, or the
consent or approval of any governmental body or the taking of any other action
to comply with or otherwise with respect to any such law or regulation, is
necessary or desirable as a condition to or in connection with the grant of such
Option or the issue, delivery or purchase of shares of Common Stock or other
property thereunder, no such Option may be exercised unless such listing,
registration, qualification, consent, approval or other action shall have been
effected or obtained free of any conditions not acceptable to the Company and
the holder of the Option will supply the Company with such certificates,
representations and information as the Company shall request and shall otherwise
cooperate with the Company in
3
<PAGE>
effecting or obtaining such listing, registration, qualification, consent,
approval or other action. The Company may at any time impose any limitations
upon the exercise, of any Option which, in the opinion of the Board of
Directors, are necessary or desirable in order to cause the Plan or any other
plan of the Company to comply with Rule 16b-3. If the Company, as part of an
offering of securities or otherwise, finds it desirable because of foreign,
federal or state legal or regulatory requirements to reduce the period during
which Options may be exercised, the Board of Directors may, without the holders'
consent, so reduce such period on not less than 15 days' written notice to the
holders thereof.
3.7 Rights of Directors. Nothing in the Plan shall confer upon any Director any
right to serve as a Director for a period of time or to continue his present or
any other rate of compensation.
3.8 Requirements of Law; Governing Law. The granting of Options and the issuance
of shares of Common Stock shall be subject to all applicable laws, rules and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required. The Plan, and all agreements hereunder,
shall be construed in accordance with and governed by the laws of the State of
Delaware.
3.9 Change in Control. In the event of a Change in Control of the Company (as
defined in Section 12.2 of the Company's 1992 Long-Term Incentive Plan), all
outstanding Options granted prior to the Change in Control shall be fully vested
and immediately exercisable in their entirety.
3.10 Effective Date. The Plan shall, subject to the approval of the holders of a
majority of the votes of all shares present, or represented, and entitled to be
cast on the matter at the 1995 Annual Meeting, be deemed effective as of such
Annual Meeting. No grants shall be made hereunder after May 31, 2005.
sjg/cc
10/22/96
4
TRIBUNE COMPANY
EMPLOYEE STOCK PURCHASE PLAN
(As Amended and Restated October 22, 1996)
The purpose of the Tribune Company Amended and Restated Employee Stock Purchase
Plan (the "Plan") is to enable employees of Tribune Company and its qualified
subsidiaries to purchase shares of the Common Stock (without par value) of
Tribune Company ("Common Stock") at a discount through payroll withholding. The
Plan was amended and restated effective October 24, 1995.
1. Shares Subject to Plan. An aggregate of 4,000,000 shares of Common Stock (the
"Shares") may be sold pursuant to the Plan. Such Shares may be authorized but
unissued Common Stock or authorized and issued Common Stock acquired by Tribune
Company for the purposes of the Plan or held in Tribune Company's Treasury.
Shares that are subject to rights granted under the Plan which expire or
terminate unexercised shall again be available for sale under the Plan. If there
is any change in the outstanding shares of Common Stock by reason of a stock
dividend or distribution, stock split-up, recapitalization, combination or
exchange of shares, or by reason of any merger, consolidation or other corporate
reorganization in which Tribune Company is the surviving corporation, the number
of Shares available for sale shall be equitably adjusted by the Committee
appointed to administer the Plan to give proper effect to such change.
2. Administration. The Plan shall be administered by a Committee consisting of
at least three members of the Board of Directors of Tribune Company. Each member
of the Committee shall be a "nonemployee director" within the meaning of Rule
16b-3 under the Securities Exchange Act of 1934 (or any successor to such Rule)
as now or hereafter amended. For as long as it continues to meet this
requirement, the Governance and Compensation Committee of the Board of Directors
of Tribune Company shall serve as the Committee. The Committee shall have the
authority to make rules and regulations governing the administration of the
Plan, and any interpretation or decision made by the Committee regarding the
administration of the Plan shall be final and conclusive.
3. Eligibility. All regular employees of Tribune Company, and of each
qualified subsidiary of Tribune Company which may be designated by Tribune
Company's Board of Directors, other than:
(a) employees whose customary employment is 20 hours or less per week;
(b) employees whose customary employment is for not more than 5 months
per year;
and
(c) employees who have not been employed for at least one year as of
any Enrollment Date (as defined in paragraph 4);
1
<PAGE>
shall be eligible to participate in the Plan. For the purposes of this Plan, the
term "qualified subsidiary" means any subsidiary, more than 50% of the total
combined voting power of all classes of stock in which is now owned or hereafter
acquired by Tribune Company or any such qualified subsidiary. The term
"subsidiary" means any corporation, 50% or more of the total combined voting
power of all classes of stock in which is now owned or hereafter acquired by
Tribune Company or any such subsidiary.
4. Participation. An eligible employee may elect to participate in the Plan as
of any "Enrollment Date". Enrollment Dates shall occur on the first day of each
payroll period immediately following a Cutoff Date (as defined in paragraph 8).
Any such election shall be made by completing and forwarding a payroll deduction
authorization form to the employee's appropriate payroll location prior to such
Enrollment Date, authorizing payroll deductions up to, but not exceeding, 10% of
the employee's regular rate of cash compensation for the payroll period
immediately preceding such Enrollment Date. A participating employee may
increase or decrease his payroll deductions as of any subsequent Enrollment Date
by completing and forwarding a revised payroll deduction authorization form to
his or her appropriate payroll location prior to such Enrollment Date; provided,
that changes in payroll deductions shall not be permitted to the extent that
they would result in total payroll deductions exceeding 10% of the employee's
regular rate of cash compensation for the payroll period immediately preceding
the Enrollment Date as of which the change takes effect. An eligible employee
may not initiate, increase or decrease payroll deductions as of any date other
than an Enrollment Date except by withdrawing from the Plan as provided in
paragraph 6.
5. Payroll Deduction Accounts. Tribune Company shall establish a payroll
deduction account for each participating employee, and shall credit all payroll
deductions made on behalf of each employee pursuant to paragraph 4 to his or her
payroll deduction account. No interest shall be credited to any payroll
deduction account.
6. Withdrawals. An employee may withdraw from an offering at any time by
completing and forwarding a written notice to the employee's appropriate payroll
location. Upon receipt of such notice, payroll deductions on behalf of the
employee shall be discontinued commencing with the immediately following payroll
period, and such employee may not again be eligible to participate in the Plan
until the next Enrollment Date. Amounts credited to the payroll deduction
account of any employee who withdraws shall remain in the account and be used to
purchase Shares in accordance with paragraph 8 hereof, subject to the
limitations in paragraph 7 hereof.
7. Offerings. The third Wednesday of each March, June, September and December
prior to the termination of the Plan shall constitute the purchase dates (the
"Purchase Dates") on which each employee for whom a payroll deduction account
has been maintained shall purchase the number of Shares determined under
paragraph 8(a). Notwithstanding the foregoing, Tribune Company shall not permit
the exercise of any right to purchase Shares:
2
<PAGE>
(a) to an employee who, immediately after the right is granted, would
own stock possessing 5% or more of the total combined voting power
or value of all classes of stock of Tribune Company or any
subsidiary; or
(b) which would permit an employee's rights to purchase stock under
this Plan, or under any other qualified employee stock purchase
plan maintained by Tribune Company or any subsidiary, to accrue at
a rate in excess of $25,000 of the fair market value of such stock
(determined at the time such rights are granted) for each calendar
year in which the right is outstanding at any time.
For the purposes of subparagraph (a), the provisions of Section 425(d) of the
Internal Revenue Code shall apply in determining the stock ownership of an
employee, and the stock which an employee may purchase under outstanding rights
or options shall be treated as stock owned by the employee.
8. Purchase of Shares. (a) Subject to the limitations set forth in paragraph 7,
each employee participating in an offering shall have the right to purchase as
many whole Shares (plus any fractional interest in a Share) as may be purchased
with the amounts credited to his or her payroll deduction account as of the
payroll date coinciding with or immediately preceding the second Wednesday of
the month in which occurs the applicable Purchase Date (the "Cutoff Date").
Employees may purchase Shares only through payroll deductions, and cash
contributions shall not be permitted.
(b) The Purchase Price for each Share shall be 85% of the closing price of
one share of Common Stock as reported on the New York Stock Exchange Composite
Transactions list for the applicable Purchase Date. If no sales of Common Stock
were reported on that date, the Purchase Price shall be the closing price of one
share of Common Stock reported for the last preceding date on which sales of
Common Stock were so reported.
(c) On each Purchase Date, the amount credited to each participating
employee's payroll deduction account as of the immediately preceding Cutoff Date
shall be applied to purchase as many whole Shares (plus any fractional interest
in a Share) as may be purchased with such amount at the applicable Purchase
Price. Any amounts remaining in an employee's payroll deduction account as of
the relevant Cutoff Date in excess of the amount that may properly be applied to
the purchase of Shares shall be refunded to the employee as soon as practicable.
9. Brokerage Accounts or Plan Share Accounts. By enrolling in the Plan, each
participating employee shall be deemed to have authorized the establishment of a
brokerage account on his or her behalf at a securities brokerage firm selected
by the Committee. Alternatively, the Committee may provide for Plan share
accounts for each participating employee to be established by Tribune Company or
by an outside entity selected by the Committee which is not a brokerage firm.
Shares purchased by an employee pursuant to the Plan shall be held in the
employee's brokerage or Plan share account in his or her name, or if the
employee so indicates on
3
<PAGE>
his or her payroll deduction authorization form, in the employee's name jointly
with a member of the employee's family, with right of survivorship. An employee
who is a resident of a jurisdiction which does not recognize such a joint
tenancy may request that such Shares be held in his or her name as tenant in
common with a member of the employee's family, without right of survivorship. A
participating employee may take part in any dividend reinvestment program
offered by the brokerage firm or, if the stock is held in a Plan share account,
in the Company's dividend reinvestment plan.
10. Rights as Stockholder. An employee shall have no rights as a stockholder
with respect to Shares subject to any rights granted under this Plan until
payment for such Shares has been completed at the close of business on the
relevant Purchase Date. An employee shall have no right to vote any fractional
interest in a Share credited to his account.
11. Certificates. Certificates for whole Shares purchased shall be issued as
soon as practicable following an employee's written request. Tribune Company may
make a reasonable charge for the issuance of such certificates. Fractional
interests in Shares shall be carried forward in an employee's brokerage or Plan
share account until they equal one whole Share or until the termination of the
employee's participation in the Plan, in which event an amount in cash equal to
the value of such fractional interest shall be paid to the employee in cash.
12. Termination of Employment. If a participating employee's employment is
terminated for any reason, including death, if an employee is granted a leave of
absence of more than 90 days duration or if an employee otherwise ceases to be
eligible to participate in the Plan, payroll deductions on behalf of the
employee shall be discontinued and any amounts then credited to the employee's
payroll deduction account shall remain in the account and be used to purchase
Shares in accordance with paragraph 8 hereof, subject to the limitations in
paragraph 7 hereof.
13. Rights Not Transferable. Rights granted under this Plan are not
transferable by a participating employee other than by will or the laws of
descent and distribution, and are exercisable during an employee's lifetime only
by the employee.
14. Employment Rights. Neither participation in the Plan, nor the exercise of
any right granted under the Plan, shall be made a condition of employment, or of
continued employment, with Tribune Company or any subsidiary.
15. Application of Funds. All funds received by Tribune Company pursuant to
this Plan may be used for any corporate purpose.
16. Amendments. The Board of Directors may at any time, and from time to time,
amend this Plan in any respect, except that no amendment:
(a) increasing the number of Shares available for sale under this Plan
(other than as permitted by paragraph 1);
4
<PAGE>
(b) changing the classification of employees eligible to participate
in the Plan or the definitions of "subsidiary" or "qualified
subsidiary"; or
(c) materially changing the method for determining the Purchase Price
of Shares;
shall be made without the affirmative vote of stockholders holding at least a
majority of the voting power of all shares of Tribune Company represented in
person or by proxy at a duly held stockholders' meeting.
17. Termination. This Plan, and all rights of employees under any offering
hereunder, shall terminate upon the first to occur of:
(a) June 30, 2002;
(b) the date on which the Committee determines that the total number
of Shares then available for sale under the Plan is not sufficient
to meet all unfilled purchase requirements; or
(c) the date on which the Plan is terminated by the Board of Directors
of Tribune Company.
Upon termination of the Plan, all payroll deductions shall cease and all amounts
then credited to the participating employees' payroll deduction accounts shall
be equitably applied to the purchase of whole Shares then available for sale,
and any remaining amounts shall be promptly refunded to the participating
employees.
18. Applicable Laws. This Plan, and all rights granted hereunder, are intended
to meet the requirements of an "employee stock purchase plan" under Section 423
of the Internal Revenue Code, as from time to time amended, and the Plan shall
be construed and interpreted to accomplish this intent. Sales of Shares under
the Plan are subject to, and shall be accomplished only in accordance with, the
requirements of all applicable securities and other laws.
19. Expenses. Except to the extent provided in paragraph 11, all expenses of
administering the Plan, including expenses incurred in connection with the
purchase of Shares for sale to participating employees, shall be borne by
Tribune Company and its subsidiaries.
sjg/cc
10/22/96
5
TRIBUNE COMPANY
1996 NONEMPLOYEE DIRECTOR STOCK COMPENSATION PLAN
(As Amended and Restated Effective October 22, 1996)
ARTICLE I
GENERAL
1.1 Purpose. Tribune Company, a Delaware corporation (the "Company"), hereby
adopts this 1996 Nonemployee Director Stock Compensation Plan (the "Plan"). The
purpose of the Plan is to increase the stock ownership of nonemployee directors,
to further align their interests with those of the Company's other stockholders
and to foster and promote the long-term financial success of the Company by
attracting and retaining outstanding nonemployee directors by enabling them to
participate in the Company's growth through stock ownership.
1.2 Participation. Only directors of the Company who at the time an award is
made are not employees of the Company or any subsidiary of the Company
("Directors") shall receive awards under the Plan.
1.3 Shares Subject to the Plan. Shares of stock covered by awards under the Plan
may be in whole or in part authorized and unissued or treasury shares of the
Company's common stock or such other shares as may be substituted pursuant to
Section 4.2 ("Common Stock"). The maximum number of shares of Common Stock which
may be issued for all purposes under the Plan shall be 75,000 (subject to
adjustment pursuant to Section 4.2).
ARTICLE II
STOCK AWARDS
2.1 Basic Stock Awards. Effective on the day after the date of each annual
meeting of the stockholders of the Company at which Directors are elected
("Annual Meeting") commencing with the Annual Meeting in 1996, each Director in
office on adjournment of said meeting will automatically be awarded under the
Plan 700 shares of Common Stock (subject to adjustment pursuant to Section 4.2)
subject to the adjustments described in Sections 2.2 and 2.3 hereof. A Director
who is not initially elected at an Annual Meeting shall receive an award for a
pro rata portion of 700 shares of Common Stock on the day following his or her
becoming a Director based on the number of months remaining from such date until
the anniversary date of the most recent Annual Meeting of the Company divided by
twelve.
2.2 Supplemental Stock Awards. Effective on the date of the Basic Stock Award,
each Director who is serving as a chairman of a standing committee or
subcommittee of the Board shall automatically be awarded an additional 100
shares of Common Stock.
2.3 Adjustment to 1996 and 1997 Basic Stock Awards. The Basic Stock Awards
provided for under Section 2.1 hereof on the day following the 1996 and 1997
Annual Meetings shall be
1
<PAGE>
reduced by 300 shares in the case of each Director who on such date holds shares
awarded under the Tribune Company 1988 Restricted Stock Plan for Outside
Directors which are subject to forfeiture under the terms of said plan.
ARTICLE III
DEFERRAL OF STOCK AWARDS
3.1 Deferral. Each Director may elect to defer receipt of part or all of any
stock awards hereunder. Any such election must be made not less than 30 days
prior to the date on which an award is made. The deferred award will be credited
to an account established in the Director's name and held subject to the
following terms and conditions:
(a) If the Company pays a cash dividend with respect to its Common Stock at
any time while there is a balance in the Director's account, the Company
will determine the cash dividend which the Director would have received had
the Director been the actual owner of the number of shares shown in the
account at the time of the dividend payment. The Company will then
determine the additional shares of Common Stock that could have been
purchased with the dividend at the fair market value of the stock on the
date of dividend payment and add this number to the Director's account.
(b) The number of whole shares in a Director's account at the time the
Director terminates service on the Board shall be delivered in a lump sum
upon termination of service or in no more than ten equal annual
installments commencing upon termination in accordance with the Director's
original deferral election. The value of any fractional shares shall be
paid in cash upon termination. A Director may amend an election with
respect to the manner of the delivery of shares at any time up to six
months prior to the date of termination of service.
(c) If a Director dies or becomes legally incapacitated, the Company will
deliver the shares to the persons designated by the Director by a writing
filed with the Company.
(d) The Company's obligations with respect to the deferred stock awards
shall not be funded or secured in any manner nor shall the Director's right
to receive shares be assignable or transferable voluntarily or
involuntarily except as expressly provided herein. However, nothing shall
prevent the Company from establishing a rabbi trust to provide a Director
additional assurance that the shares subject to a deferred award will be
delivered in a timely fashion in accordance with the Director's election.
2
<PAGE>
ARTICLE IV
MISCELLANEOUS PROVISIONS
4.1 Nontransferability. No shares awarded under the Plan shall be sold for a
period of six months and one day after the date of the award.
4.2 Adjustments Upon Certain Changes. If any of the events described in Sections
4.4(a) or (b) of the Company's 1992 Long-Term Incentive Plan shall occur, the
number of shares authorized by the Plan, shall be automatically adjusted on the
same basis to give the proper effect to such change so as to prevent the
dilution or enlargement of the shares available under Section 1.3 hereof.
4.3 Amendment or Discontinuation of Plan. The Board of Directors may amend the
Plan at any time without shareholder approval except that such approval will be
required to increase the number of shares which may be issued under the Plan or
suspend or discontinue the Plan at any time, but no such action shall adversely
affect any prior award.
4.4 Plan Not Exclusive. The adoption of the Plan does not supersede the 1995
Nonemployee Director Stock Option Plan and shall not preclude the adoption by
appropriate means of any other stock or other compensation plan for Directors.
4.5 Other Provisions; Securities Registration. The grant of any award under the
Plan may also be subject to other provisions as counsel to the Company deems
appropriate, including, without limitation, such provisions as may be
appropriate to comply with federal or state securities laws and stock listing
requirements.
4.6 Rights of Directors. Nothing in the Plan shall confer upon any Director any
right to serve as a Director for a period of time or to continue his or her
present or any other rate of compensation.
4.7 Requirements of Law; Governing Law. The awarding and the issuance of shares
of Common Stock shall be subject to all applicable laws, rules and regulations,
and to such approvals by any governmental agencies or national securities
exchanges as may be required. The Plan, and all agreements hereunder, shall be
construed in accordance with and governed by the laws of the State of Delaware.
4.8 Effective Date. The Plan shall, subject to the approval of the holders of a
majority of the votes of all shares present, or represented, and entitled to be
cast on the matter at the 1996 Annual Meeting, be deemed effective as of such
Annual Meeting. No grants shall be made hereunder after May 31, 2006.
sjg/cc
10/22/96
3
EXHIBIT 11
TRIBUNE COMPANY
STATEMENTS OF COMPUTATION OF PRIMARY AND FULLY DILUTED
NET INCOME PER SHARE
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Third Quarter Ended Three Quarters Ended
--------------------------------- ---------------------------------
PRIMARY Sept. 29, 1996 Sept. 24, 1995 Sept. 29, 1996 Sept. 24, 1995
- ------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Income from continuing operations $ 66,236 $ 44,072 $ 200,905 $ 180,598
Discontinued operations of QUNO, net of tax - 11,828 89,317 25,392
-------------- ------------- -------------- --------------
Net income 66,236 55,900 290,222 205,990
Preferred dividends, net of tax (4,697) (4,622) (14,090) (13,865)
-------------- ------------- -------------- --------------
Net income attributable to common shares $ 61,539 $ 51,278 $ 276,132 $ 192,125
-------------- ------------- -------------- --------------
Weighted average common shares outstanding 61,234 64,865 61,360 65,285
-------------- ------------- -------------- --------------
Primary net income per share:
Continuing operations (A) $ 1.00 $ .61 $ 3.04 $ 2.55
Discontinued operations - .18 1.46 .39
-------------- ------------- -------------- --------------
Total $ 1.00 $ .79 $ 4.50 $ 2.94
============== ============= ============== ==============
FULLY DILUTED
- -------------
Income from continuing operations $ 66,236 $ 44,072 $ 200,905 $ 180,598
Additional ESOP contribution required assuming
all preferred shares were converted, net of tax (3,374) (3,600) (10,123) (10,814)
-------------- ------------- -------------- --------------
Adjusted income from continuing operations 62,862 40,472 190,782 169,784
Discontinued operations of QUNO, net of tax - 11,828 89,317 25,392
-------------- ------------- -------------- --------------
Adjusted net income $ 62,862 $ 52,300 $ 280,099 $ 195,176
-------------- ------------- -------------- --------------
Weighted average common shares outstanding 61,234 64,865 61,360 65,285
Assumed conversion of preferred shares into
common shares 5,703 5,887 5,703 5,887
Assumed exercise of stock options, net of common
shares assumed repurchased with the proceeds 1,144 1,030 1,192 835
-------------- ------------- -------------- --------------
Adjusted weighted average common shares outstanding 68,081 71,782 68,255 72,007
-------------- ------------- -------------- --------------
Fully diluted net income per share:
Continuing operations $ .92 $ .56 $ 2.79 $ 2.36
Discontinued operations - .17 1.31 .35
-------------- ------------- -------------- --------------
Total $ .92 $ .73 $ 4.10 $ 2.71
============== ============= ============== ==============
</TABLE>
(A) Primary net income per share from continuing operations is computed by
deducting preferred dividends, net of tax, from income from continuing
operations and then dividing by weighted average common shares
outstanding.
See Notes to Consolidated Financial Statements.
EXHIBIT 12
TRIBUNE COMPANY
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
(In thousands, except ratios)
<TABLE>
<CAPTION>
Fiscal Year Ended December
Three Quarters ---------------------------------------------------------------------
Ended 9/29/96 1995 1994 1993 1992 1991
-------------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Income from continuing operations before
cumulative effects of accounting changes $ 200,905 $ 245,458 $ 233,149 $ 204,646 $ 179,534 $ 158,049
Add:
Income tax expense 136,751 167,076 158,698 142,212 120,089 106,514
Losses on equity investments 14,719 13,209 9,739 1,857 1,903 1,107
----------- ----------- ---------- ---------- ---------- ----------
Subtotal 352,375 425,743 401,586 348,715 301,526 265,670
----------- ----------- ---------- ---------- ---------- ----------
Fixed charge adjustments
Add:
Interest expense 34,680 21,814 20,585 24,660 35,301 45,588
Amortization of capitalized interest 1,581 2,253 2,362 2,392 2,434 2,435
Interest component of rental expense (A) 7,192 8,200 8,236 8,732 8,182 7,647
----------- ----------- ---------- ---------- ---------- ----------
Earnings, as adjusted $ 395,828 $ 458,010 $ 432,769 $ 384,499 $ 347,443 $ 321,340
=========== =========== ========== ========== ========== ==========
Fixed charges:
Interest expense $ 34,680 $ 21,814 $ 20,585 $ 24,660 $ 35,301 $ 45,588
Interest capitalized 168 610 - 1,099 1,092 146
Interest component of rental expense (A) 7,192 8,200 8,236 8,732 8,182 7,647
Interest related to guaranteed ESOP debt (B) 15,096 22,057 24,017 25,742 27,019 27,500
----------- ----------- ---------- ---------- ---------- ----------
Total fixed charges $ 57,136 $ 52,681 $ 52,838 $ 60,233 $ 71,594 $ 80,881
=========== =========== ========== ========== ========== ==========
Ratio of Earnings to Fixed Charges 6.9 8.7 8.2 6.4 4.9 4.0
=========== =========== ========== ========== ========== ==========
</TABLE>
(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).
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
September 29, 1996 condensed consolidated statement of income and condensed
consolidated balance sheet and is qualified in its entirety by reference to such
financial statements. </LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-29-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-29-1996
<CASH> 10,685
<SECURITIES> 3,355
<RECEIVABLES> 402,061
<ALLOWANCES> 36,338
<INVENTORY> 76,804
<CURRENT-ASSETS> 642,536
<PP&E> 1,433,592
<DEPRECIATION> 793,487
<TOTAL-ASSETS> 3,521,812
<CURRENT-LIABILITIES> 608,667
<BONDS> 0
0
312,470
<COMMON> 1,018
<OTHER-SE> 1,139,851
<TOTAL-LIABILITY-AND-EQUITY> 3,521,812
<SALES> 0
<TOTAL-REVENUES> 1,797,376
<CGS> 0
<TOTAL-COSTS> 901,873
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 34,680
<INCOME-PRETAX> 337,656
<INCOME-TAX> 136,751
<INCOME-CONTINUING> 200,905
<DISCONTINUED> 89,317
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 290,222
<EPS-PRIMARY> 4.50
<EPS-DILUTED> 4.10
</TABLE>
