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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: APRIL 22, 1994
MCCLATCHY NEWSPAPERS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE 1-9824 94-0666175
(STATE OR OTHER (COMMISSION FILE NUMBER) (IRS EMPLOYER ID. NO.)
JURISDICTION OF INCORPORATION)
2100 "Q" STREET, SACRAMENTO, CALIFORNIA 95816
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE) (ZIP CODE)
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REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (916) 321-1846
Item 5. OTHER EVENTS.
See attached Press Release of McClatchy Newspapers, Inc. dated April 19,
1994, which is incorporated herein by reference.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
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99.1 Press Release dated April 19, 1994 of McClatchy Newspapers, Inc.
99.2 Unaudited Consolidated Balance Sheet of McClatchy Newspapers, Inc. as of
March 31, 1994 and December 31, 1993
99.3 Unaudited Consolidated Statement of Income of McClatchy Newspapers, Inc. for
the three months ended March 31, 1994 and March 31, 1993.
99.4 Unaudited Consolidated Statement of Cash Flows of McClatchy Newspapers, Inc.
for the three months ended March 31, 1994 and March 31, 1993.
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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 hereunto duly authorized.
McCLATCHY NEWSPAPERS, INC.
Dated: April 21, 1994 By /s/ JAMES P. SMITH
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James P. Smith
Vice President, Finance
and Treasurer
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INDEX TO EXHIBITS
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EXHIBIT
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99.1 Press Release dated April 19, 1994 of McClatchy Newspapers, Inc.
99.2 Unaudited Consolidated Balance Sheet of McClatchy Newspapers,
Inc. as of March 31, 1994 and December 31, 1993.
99.3 Unaudited Consolidated Statement of Income of McClatchy
Newspapers, Inc. for the three months ended March 31, 1994 and
March 31, 1993.
99.4 Unaudited Consolidated Statement of Cash Flows of McClatchy
Newspapers, Inc. for the three months ended March 31, 1994 and
March 31, 1993.
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EXHIBIT 99.1
Contact: Elaine Lintecum
(916) 321-1846 For Immediate Release
MCCLATCHY NEWPAPERS REPORTS 24% INCREASE IN EARNINGS
SACRAMENTO, CA, APRIL 19, 1994 -- MCCLATCHY NEWSPAPERS, INC. (NYSE-MNI)
today reported first quarter earnings of $5.9 million or 20 cents per share -- a
record high for McClatchy's first quarter. Earnings were up 23.7% from 1993
earnings of $4.8 million (17 cents).
First quarter 1994 earnings include a one-time pre-tax charge of $768,000
for closing many of the company's Senior Spectrum tabloid newspapers which
served readers over age 55. Excluding this charge, earnings would have been 22
cents per share or 32.3% higher than 1993. Earnings also benefitted from Easter
advertising which occurred principally in the first quarter of 1994 versus the
second quarter of 1993.
Net revenues increased to $108.9 million, up 3.5% from 1993 revenues of
$105.3 million. Advertising revenues were $83.8 million, a gain of 3.6% and
circulation revenues posted a 1.2% increase to $21.2 million.
Operating expenses were held to a 2.7% increase, generally reflecting low
newsprint prices and company-wide cost control programs. Operating income
increased 10.0% to $11.6 million compared to $10.5 million in 1993. Excluding
the Senior Spectrum charge, operating income increased 17.3% over 1993.
Net income also benefitted from higher interest income on investments and
smaller losses from McClatchy's Ponderay newsprint mill joint venture.
Commenting on the quarterly results, Erwin Potts, chief executive officer,
noted that "Advertising revenues and earnings exceeded our expectations even
after factoring in the effect of Easter advertising. In particular, classified
advertising began to improve in February and was strong in March. Our company is
poised to benefit from an economic recovery in Northern California should
business activity continue to pick up. Meanwhile we remain committed to cost
controls to keep expenses in line with revenue expectations."
With headquarters in Sacramento, CA, McClatchy Newspapers is a
communications company with a history dating back to 1857 when James McClatchy
was the founding editor of The Sacramento Bee. Today, McClatchy publishes 12
daily newspapers and eight non-daily newspapers located principally in western
coastal states and South Carolina. The Company, through its subsidiary, The
Newspaper Network, Inc., distributes preprinted advertising inserts to
newspapers throughout the country and is one of six partners in the Ponderay
newsprint mill in Usk, Washington.
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MCCLATCHY NEWSPAPERS, INC.
SUMMARY OF UNAUDITED RESULTS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
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QUARTER ENDED
MARCH 31,
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1994 1993
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Revenues -- net........................................................ $108,924 $105,282
Operating expenses:
Compensation......................................................... 50,198 49,692
Newsprint and supplements............................................ 14,708 14,189
Depreciation and amortization........................................ 9,520 8,665
Other operating expense.............................................. 22,893 22,190
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Total........................................................ 97,319 94,736
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Operating income....................................................... 11,605 10,546
Partnership loss....................................................... 1,500 1,800
Interest (income)...................................................... (354) (7)
Other nonoperating expenses -- net..................................... 23 311
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Income before taxes.................................................... 10,436 8,442
Income tax provision................................................... 4,539 3,674
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Net income............................................................. $ 5,897 $ 4,768
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Net income per common share............................................ $ 0.20 $ 0.17
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Weighted average shares outstanding.................................... 28,937 28,833
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EXHIBIT 99.2
MCCLATCHY NEWSPAPERS, INC.
UNAUDITED CONSOLIDATED BALANCE SHEET
(IN THOUSANDS)
ASSETS
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DECEMBER
MARCH 31, 31,
1994 1993
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CURRENT ASSETS:
Cash and cash equivalents............................................ $ 56,048 $ 42,326
Trade receivables (less allowances of 2,038 in 1994 and 1,757 in
1993).............................................................. 44,180 47,859
Other receivables.................................................... 1,343 1,456
Newsprint, ink and other inventories................................. 7,336 10,033
Deferred income taxes................................................ 9,977 9,672
Other current assets................................................. 2,902 1,843
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TOTAL CURRENT ASSETS................................................. 121,786 113,189
PROPERTY, PLANT AND EQUIPMENT:
Land................................................................. 18,623 18,057
Buildings and improvements........................................... 119,937 120,753
Equipment............................................................ 291,826 282,082
Construction in progress............................................. 12,072 15,893
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Total................................................................ 442,458 436,785
Accumulated depreciation............................................. (171,453) (166,460)
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NET PROPERTY, PLANT AND EQUIPMENT.................................... 271,005 270,325
INTANGIBLES -- NET................................................... 122,141 124,662
INVESTMENT IN NEWSPRINT MILL PARTNERSHIP............................. 3,827 3,977
OTHER ASSETS......................................................... 11,434 13,010
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TOTAL ASSETS......................................................... $ 530,193 $ 525,163
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable..................................................... $ 11,852 $ 14,043
Accrued compensation................................................. 27,991 26,324
Income taxes......................................................... 5,942 1,117
Unearned revenue..................................................... 11,546 10,560
Carrier deposits..................................................... 3,176 3,055
Other accrued liabilities............................................ 7,661 8,281
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TOTAL CURRENT LIABILITIES............................................ 68,168 63,380
LONG-TERM OBLIGATIONS................................................ 14,016 14,213
DEFERRED INCOME TAXES................................................ 60,616 64,047
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value:
Class A -- authorized 50,000,000 shares, issued 5,388,706 in 1994
and 5,100,450 in 1993........................................... 54 51
Class B -- authorized 30,000,000 shares, issued 24,231,789 in 1994
and 24,503,789 in 1993.......................................... 235 238
Additional paid-in capital........................................... 39,753 39,472
Retained earnings.................................................... 347,722 344,133
Treasury stock, 20,000 Class A shares and 750,000 Class B shares..... (371) (371)
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TOTAL STOCKHOLDERS' EQUITY........................................... 387,393 383,523
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY........................... $ 530,193 $ 525,163
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EXHIBIT 99.3
MCCLATCHY NEWSPAPERS, INC.
UNAUDITED CONSOLIDATED STATEMENT OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
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<CAPTION>
THREE MONTHS ENDED
MARCH 31,
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1994 1993
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REVENUES -- NET:
Advertising............................................................ $ 83,829 $ 80,955
Circulation............................................................ 21,194 20,949
Other.................................................................. 3,901 3,378
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TOTAL.................................................................. 108,924 105,282
OPERATING EXPENSES:
Compensation........................................................... 50,198 49,692
Newsprint and supplements.............................................. 14,708 14,189
Depreciation and amortization.......................................... 9,520 8,665
Other operating expenses............................................... 22,893 22,190
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TOTAL.................................................................. 97,319 94,736
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OPERATING INCOME....................................................... 11,605 10,546
NONOPERATING EXPENSES (INCOME):
Interest expense....................................................... 3 47
Interest income........................................................ (354) (7)
Partnership losses..................................................... 1,500 1,800
Other -- net........................................................... 20 264
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TOTAL.................................................................. 1,169 2,104
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INCOME BEFORE INCOME TAX PROVISION..................................... 10,436 8,442
Income tax provision................................................... 4,539 3,674
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NET INCOME............................................................. $ 5,897 $ 4,768
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NET INCOME PER COMMON SHARE............................................ $ 0.20 $ 0.17
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WEIGHTED AVERAGE NUMBER OF COMMON SHARES............................... 28,937 28,833
</TABLE>
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EXHIBIT 99.4
MCCLATCHY NEWSPAPERS, INC.
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
(IN THOUSANDS)
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THREE MONTHS ENDED
MARCH 31,
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1994 1993
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CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
Net income.............................................................. $ 5,897 $ 4,768
Reconciliation to net cash provided:
Depreciation and amortization......................................... 9,563 8,711
Partnership losses.................................................... 1,500 1,800
Changes in certain current assets and liabilities -- net.............. 8,499 10,270
Other................................................................. (375) 808
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NET CASH PROVIDED BY OPERATING ACTIVITIES............................... 25,084 26,357
CASH PROVIDED (USED) BY INVESTING ACTIVITIES:
Purchase of property, plant and equipment............................... (7,865) (6,292)
Investment in newsprint mill partnership................................ (1,350) (1,418)
Other -- net............................................................ 51 50
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NET CASH USED BY INVESTING ACTIVITIES:.................................. (9,164) (7,660)
CASH PROVIDED (USED) BY FINANCING ACTIVITIES:
Repayment of long-term debt............................................. -- (10,012)
Payment of cash dividends............................................... (2,308) (1,799)
Other................................................................... 110 289
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NET CASH USED BY FINANCING ACTIVITIES................................... (2,198) (11,522)
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NET CHANGE IN CASH AND CASH EQUIVALENTS................................. 13,722 7,175
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR............................ 42,326 8,658
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CASH AND CASH EQUIVALENTS, END OF PERIOD................................ $56,048 $ 15,833
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