United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-Q
(Mark One)
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR
----- 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period March 31, 1996
----- TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____to_____
Commission File Number: 1-10333
--------------------------------
CENTRAL NEWSPAPERS, INC.
(Exact name of registrant as specified in its charter)
Indiana 35-0220660
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
135 North Pennsylvania Street, Suite 1200, Indianapolis, Indiana 46204
(Address of principal executive office)
(317) 231-9200
(Registrant's telephone number)
Indicate by check mark whether the registrant has (1) 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
--- ---
The number of shares of each class of common stock outstanding as of March 31,
1996:
CLASS A COMMON STOCK 23,614,111
CLASS B COMMON STOCK 31,553,000
<PAGE>2
Central Newspapers, Inc.
Index to Form 10-Q
Part I -- FINANCIAL INFORMATION Page
----
Item 1 -- Financial Statements:
Consolidated Statement of Financial Position 3-4
Consolidated Statement of Income 5
Consolidated Statement of Shareholders' Equity 6
Consolidated Statement of Cash Flows 7
Notes to Consolidated Financial Statements 8-9
Item 2 -- Management's Discussion and Analysis of
Financial Condition and Results of Operations 9-11
Part II -- OTHER INFORMATION 12-15
<PAGE>3
PART I
Item 1. Financial Statements
CENTRAL NEWSPAPERS, INC.
Consolidated Statement of Financial Position
===============================================================================
March 31, Dec. 31,
ASSETS 1996 1995
(In thousands) (Unaudited)
- -------------------------------------------------------------------------------
CURRENT ASSETS:
Cash and cash equivalents $36,205 $26,142
Marketable securities 48,846 103,390
Accounts receivable (net of allowances of
$792 and $1,067) 58,224 62,355
Inventories 10,988 10,125
Deferred income tax benefits 6,781 6,773
Other current assets 5,362 4,233
- -------------------------------------------------------------------------------
Total current assets 166,406 213,018
- -------------------------------------------------------------------------------
PROPERTY, PLANT AND EQUIPMENT:
Land 17,189 16,943
Buildings and improvements 90,832 110,265
Leasehold improvements 4,189 4,177
Machinery and equipment 342,871 322,799
Construction in progress 31,294 33,567
- -------------------------------------------------------------------------------
486,375 487,751
Less accumulated depreciation 195,959 206,946
- -------------------------------------------------------------------------------
290,416 280,805
- -------------------------------------------------------------------------------
OTHER ASSETS:
Land held for development 3,107 1,607
Goodwill 76,535 29,009
Investment in Affiliate 6,949 5,843
Other 24,327 16,922
- -------------------------------------------------------------------------------
110,918 53,381
- -------------------------------------------------------------------------------
TOTAL ASSETS $567,740 $547,204
===============================================================================
See accompanying notes to consolidated financial statements.
<PAGE>4
CENTRAL NEWSPAPERS, INC.
Consolidated Statement of Financial Position
===============================================================================
March 31, Dec. 31,
LIABILITIES AND SHAREHOLDERS' EQUITY 1996 1995
(In thousands, except share data) (Unaudited)
- -------------------------------------------------------------------------------
CURRENT LIABILITIES:
Accounts payable $16,720 $19,122
Accrued compensation 16,223 17,172
Dividends payable 4,609 5,027
Accrued expenses and other liabilities 15,691 14,567
Federal and state income taxes 6,424 1,941
Deferred revenue 19,052 17,371
- -------------------------------------------------------------------------------
Total current liabilities 78,719 75,200
- -------------------------------------------------------------------------------
DEFERRED INCOME TAXES 28,328 23,009
- -------------------------------------------------------------------------------
LONG-TERM DEBT 7,178 2,678
- -------------------------------------------------------------------------------
POSTRETIREMENT BENEFIT OBLIGATION 80,088 79,327
- -------------------------------------------------------------------------------
MINORITY INTEREST IN SUBSIDIARY 8,357 8,249
- -------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY:
Preferred stock--issuable in series:
Authorized--25,000,000 shares
Issued--none
Class A common stock--without par value:
Authorized--75,000,000 shares
Issued--23,614,111 and 23,520,611 shares 20,099 18,967
Class B common stock--without par value:
Authorized--50,000,000 shares
Issued--31,553,000 shares 63 63
Retained earnings 343,703 338,436
Unrealized gain on available-for-sale securities 1,205 1,275
- -------------------------------------------------------------------------------
365,070 358,741
- -------------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $567,740 $547,204
===============================================================================
See accompanying notes to consolidated financial statements.
<PAGE>5
CENTRAL NEWSPAPERS, INC.
Consolidated Statement of Income
(Unaudited)
===============================================================================
(In thousands, except per share data) 13 Weeks Ended
March 31, March 26,
1996 1995
- -------------------------------------------------------------------------------
OPERATING REVENUES:
Advertising $112,504 $103,992
Circulation 34,270 31,968
Other 1,122 922
- -------------------------------------------------------------------------------
147,896 136,882
- -------------------------------------------------------------------------------
OPERATING EXPENSES:
Operating costs 72,046 61,530
Distribution and general 49,618 47,838
Depreciation and amortization 8,459 7,174
Building impairment cost 3,034
Work force reduction cost 440 248
- -------------------------------------------------------------------------------
133,597 116,790
- -------------------------------------------------------------------------------
OPERATING INCOME 14,299 20,092
OTHER INCOME (principally investment income) 1,857 2,533
OTHER EXPENSE (264) (278)
- -------------------------------------------------------------------------------
INCOME BEFORE INCOME TAXES 15,892 22,347
PROVISION FOR INCOME TAXES 6,592 9,123
- -------------------------------------------------------------------------------
INCOME BEFORE MINORITY INTEREST AND
EQUITY IN AFFILIATE 9,300 13,224
MINORITY INTEREST IN SUBSIDIARY (182) (304)
EQUITY IN AFFILIATE, NET OF TAX 691 (537)
- -------------------------------------------------------------------------------
NET INCOME $9,809 $12,383
==============================================================================
NET INCOME PER COMMON SHARE $.37 $.46
===============================================================================
DIVIDENDS DECLARED PER CLASS A COMMON SHARE $.17 $.14
AVERAGE COMMON SHARES OUTSTANDING 26,700 26,639
(combined Class A and equivalent Class B shares)
See accompanying notes to consolidated financial statements.
<PAGE>6
CENTRAL NEWSPAPERS, INC.
Consolidated Statement of Shareholders' Equity
(Unaudited)
================================================================================
(In thousands) Unrealized
Gain on
Class A Class B Available-
Common Common Retained for-Sale
Stock Stock Earnings Securities
- --------------------------------------------------------------------------------
BALANCE AT DECEMBER 26, 1994 $18,182 $63 $300,968 $549
Net income (13 weeks) 12,383
Dividends declared:
Class A common stock (3,288)
Class B common stock (442)
Exercise of stock options 88
Change in net unrealized gain on
available-for-sale securities 150
- --------------------------------------------------------------------------------
BALANCE AT MARCH 26, 1995 18,270 63 309,621 699
Net income (40 weeks) 41,615
Dividends declared:
Class A common stock (11,285)
Class B common stock (1,515)
Exercise of stock options 697
Change in net unrealized gain on
available-for-sale securities 576
- --------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1995 18,967 63 338,436 1,275
Net income (13 weeks) 9,809
Dividends declared:
Class A common stock (4,006)
Class B common stock (536)
Exercise of stock options 1,132
Change in net unrealized gain on
available-for-sale securities (70)
- --------------------------------------------------------------------------------
BALANCE AT MARCH 31, 1996 $20,099 $63 $343,703 $1,205
================================================================================
See accompanying notes to consolidated financial statements.
<PAGE>7
CENTRAL NEWSPAPERS, INC.
Consolidated Statement of Cash Flows
(Unaudited)
===============================================================================
(In thousands) 13 Weeks Ended
March 31, March 26,
1996 1995
- -------------------------------------------------------------------------------
OPERATING ACTIVITIES:
Net income $9,809 $12,383
Items which did not use (provide) cash:
Depreciation and amortization 8,463 7,371
Postretirement and pension benefits 1,687 1,030
Loss (gain) on disposition of assets 2,960 (73)
Minority interest in earnings of subsidiary 181 304
Equity in Affiliate (715) 537
Deferred income taxes 490 659
Net change in unrealized gains on trading securities 967 (516)
Net proceeds from (purchases of) trading securities 41,392 (11,407)
Net change in other current assets and liabilities 8,279 10,900
- -------------------------------------------------------------------------------
Net cash provided by operating activities 73,513 21,188
- -------------------------------------------------------------------------------
INVESTING ACTIVITIES:
Purchase of property, plant and equipment-net (12,310) (9,883)
Purchases of available-for-sale securities (5,798) (34,608)
Proceeds from available-for-sale securities 19,884 33,274
Investment in Affiliate (540)
Acquisition of McCormick and Company, Inc. (60,509)
Other (581) (753)
- -------------------------------------------------------------------------------
Net cash used by investing activities (59,314) (12,510)
- -------------------------------------------------------------------------------
FINANCING ACTIVITIES:
Cash dividends paid (4,535) (3,729)
Dividends paid to minority interest (492) (476)
Proceeds from exercise of stock options 891 72
- -------------------------------------------------------------------------------
Net cash used by financing activities (4,136) (4,133)
- -------------------------------------------------------------------------------
INCREASE IN CASH AND CASH EQUIVALENTS 10,063 4,545
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 26,142 22,105
- -------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $36,205 $26,650
===============================================================================
SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid during the period $1,745 $26
Interest paid during the period 168 57
See accompanying notes to consolidated financial statements.
<PAGE>8
CENTRAL NEWSPAPERS, INC.
Notes to Consolidated Financial Statements
(Unaudited)
1. Central Newspapers, Inc. and its subsidiaries (the "Company") are primarily
engaged in the publishing and distribution of newspapers. Revenues are
principally derived from advertising and newspaper sales, in the Phoenix,
Arizona and Indianapolis, Indiana metropolitan areas. The Company also has a
13.5% interest in Ponderay Newsprint Company ("Affiliate"), a partnership
formed to own and operate a newsprint mill in Washington.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
2. The accompanying unaudited consolidated financial statements do not include
all of the information and disclosures which are normally included in Form 10-K
and annual report to shareholders. These financial statements should be read in
conjunction with the Company's audited consolidated financial statements and
related notes for the year ended December 31, 1995. The accompanying
consolidated financial statements have been prepared in accordance with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The consolidated
statement of financial position at December 31, 1995 has been derived from
audited financial statements. In the opinion of the Company's management, the
unaudited consolidated financial statements reflect all adjustments which are
necessary to present fairly the Company's financial position, results of
operations and cash flows for the interim periods presented. All adjustments
are of a normal recurring nature. Such statements are not necessarily
indicative of the results to be expected for the full year.
3. The Company's fiscal year ends on the last Sunday of the calendar year. The
years ending December 29, 1996 and December 31, 1995 comprise 52 and 53 weeks,
respectively.
4. Net income per common share is computed based on the weighted average number
of common shares outstanding. The Class B common shareholders have the right to
convert their shares into shares of Class A common stock at the ratio of ten
shares of Class B common stock for one share of Class A common stock. The Class
B common stock is included in the computation as if converted into Class A
common stock.
5. During 1996 and 1995, the Company reduced its work force in response to the
advertising environment and technological changes. Certain employees were
offered retirement benefits through a non-qualified supplemental retirement
plan. As of March 31, 1996, work force reduction costs were $440,000. As of
March 26, 1995, work force reduction costs were $248,000.
6. The Company, through its subsidiaries, has a 13.5% partnership interest in
Ponderay Newsprint Company ("Ponderay"), which was formed to own and operate a
newsprint mill in Washington. The Company's investment in Ponderay at March 31,
1996 and March 26, 1995 was $36.4 million and $34.5 million.
The Company has committed to purchase for use in Phoenix the lesser of 13.5% of
annual newsprint production or 34,900 metric tons on a "take if tendered" basis
until the partnership debt is repaid. During the thirteen weeks ended March 31,
1996 and March 26, 1995 the Company purchased $6.7 million and $4 million of
newsprint from Ponderay. For the three months ended March 31, 1996, Ponderay's
net revenue and net income were $47 million and $9.5 million, respectively,
compared to net revenue of $31.6 million and a net loss of $5.4 million during
the first three months of 1995.
<PAGE>9
7. The Company's Stock Compensation Plan has 484,100 options exercisable as of
March 31, 1996. During the fiscal three months ended March 31, 1996, options
for 45,500 shares of Class A common stock were exercised.
8. During 1993, the Company announced the construction of a new downtown
Phoenix office building. Total costs of the building and related
expenditures are expected to be $32 million with completion anticipated in
June 1996. Phoenix Newspapers, Inc. will install a new computer system with
an estimated maximum cost of $24 million. The anticipated completion date is
mid-1997. Formal commitments totaling $40.2 million have been entered into
related to these and other capital projects. Expenditures on these
commitments were $30.5 million at March 31, 1996.
The Company has committed $10 million for investment in partnership business
ventures of which $3.7 million was expended at March 31, 1996.
9. Statement of Financial Accounting Standards (SFAS) No. 123, "Stock-Based
Compensation," is effective for the Company for 1996. This statement
establishes a fair value based method of accounting for stock-based
compensation plans. The Company intends to account for stock-based compensation
as prescribed in Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees," with appropriate proforma disclosures made in the
notes to the financial statements.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
General
The Company's business is to a certain extent seasonal with peak revenues and
profits generally occurring in the second and fourth quarters.
On March 12, 1996 the Company purchased 100% of the outstanding common stock of
McCormick and Company, Inc., the parent company of the Alexandria Daily Town
Talk newspaper of Louisiana and McCormick Graphics, Inc., a commercial printing
subsidiary. The purchase price was approximately $62 million in cash and was
accounted for using the purchase method of accounting as of March 1, 1996.
During the first quarter of 1996, the Company recorded a $3 million building
impairment charge for the disposal of an existing downtown Phoenix office
building. This loss was recorded using the provisions of SFAS No. 121
"Accounting for the Impairment of Long-Lived Assets to be Disposed of."
Results of Operations - Fiscal First Quarter Comparisons
Operating revenues for the quarter increased $11 million, or 8.1%, which
consisted of an increase in advertising revenue of $8.5 million, or 8.2%, and an
increase in circulation revenue of $2.3 million, or 7.2%.
Advertising full run-of-press (ROP) linage was up 1.6% for the quarter. Retail
linage was down 3.2%, national linage was up 18% and classified linage increased
4.5%. The volume of preprinted inserts, which includes local and national
advertising supplements inserted into the newspapers, decreased 2.8%.
Advertising revenue at Phoenix increased 8.9% while full run linage was up 3.5%.
At Indianapolis, advertising revenue was up 4% while full run linage was down
1.7%. Indianapolis newspapers increased advertising rates during the first
quarter of 1996 and Phoenix raised certain advertising rates in January 1996 and
October 1995.
<PAGE>10
Circulation revenue increased 10.4% at Phoenix. Circulation of the Phoenix
morning newspaper was up 2.9%, evening down 18.8% and Sunday circulation
decreased 1.9%. Circulation revenue was favorably impacted by a home delivered
price increase of $.35 per week in August 1995 and a Sunday single copy price
increase of $.50 to $2.00 effective March 1995. Circulation revenue decreased
3.1% at Indianapolis. Circulation of the Indianapolis morning newspaper was up
2.4%, evening down 24.1% and Sunday circulation was up 1.9%. Revenues were
impacted by the March 6, 1995 home-delivered price increase in the daily
newspaper to $1.80 per week from $1.50 and the daily single copy price increase
to $.50 from $.35. In 1995, the Phoenix and Indianapolis newspapers consolidated
their morning and evening newsroom staffs. These changes were designed to create
more resources for expanded coverage of urban and suburban issues along with
continued expansion of new forms of information distributions. Due to these
combinations, along with the rate increases, evening newspaper circulation has
declined.
Operating expenses of $133.6 million, which includes $3 million of building
impairment costs, were up 14.4% for the period. Excluding the special building
impairment charge, operating expenses increased 11.8%. Compensation expense,
which includes fringe benefits, was up 3.5% for the period. The increase in
compensation expense reflects higher costs associated with post-employment
expenses. Newsprint expense increased $8.3 million or 35.6%, reflecting a .5%
increase in consumption and higher newsprint prices. Depreciation and
amortization expense of $8.5 million increased 17.9% due to the new production
facility in Indianapolis and the computer system in Phoenix. Other operating,
distribution and general expenses were up 8.4% reflecting costs associated with
the new Phoenix office building and increased promotional expenses.
Operating income decreased $5.8 million, or 28.8%. Other income was down
$.7 million, or 26.7%, due to a reduction in interest rates and less cash
available for investment. Income before provision for income taxes was down $6.5
million, or 28.9%. The provision for income taxes was down $2.5 million, or
27.7%, and reflects lower income for the period.
Income from Equity in Affiliate, net of tax, changed from a loss of $.5 million
in 1995 to income of $.7 million in 1996 due to the increase in newsprint prices
realized by Ponderay.
Net income for the quarter decreased $2.6 million, or 20.8%, compared to the
same period the prior year. Earnings per share for the quarter were $.37 for
1996, a decrease of 19.6%, from the $.46 per share the prior year quarter.
Excluding the special charges for the building impairment and work force
reductions, earnings were $11.8 million or $.44 per share, compared with $12.5
million, or $.47 per share, in 1995.
Liquidity and Capital Resources
Net cash provided by operating activities of $73.5 million includes $41.4
million from the sale of trading securities. Cash provided by operating
activities was used primarily for the purchase of property and equipment, the
acquisition of McCormick and Company, Inc., and the payment of dividends. At
the end of the period, the Company's cash and investments in marketable
securities totaled $85.1 million, down $44.5 million from the beginning of the
year. Working capital at March 31, 1996 was $87.7 million, down $50.1 million,
from the beginning of the year. These reductions are primarily attributable to
the purchase of McCormick and Company, Inc.
Capital expenditures through March 31, 1996 were $12.3 million. Capital
expenditures for the year are expected to approximate $40 million.
<PAGE>11
Phoenix Newspapers, Inc. (PNI) is constructing a new downtown Phoenix office
building. Total costs of the building and related expenditures are expected to
be $32 million with completion anticipated in June 1996. PNI will install a new
computer system with an estimated maximum cost of $24 million with completion
expected in mid-1997. Formal commitments totaling $40.2 million have been
entered into related to these and other capital projects at PNI. Expenditures
on these commitments were $30.5 million at March 31, 1996.
In addition, the Board of Directors has approved investments in partnership
business ventures of $10 million. As of March 31, 1996, $3.7 million has been
expended. The Company currently does not anticipate borrowing any funds for
these capital projects and investments.
On March 19, 1996 the Board of Directors of the Company authorized the
repurchase of up to 1,000,000 shares of the Company's Class A common stock. The
shares may be purchased within the next three years on the open market or in
privately negotiated transactions. For the quarter ending March 31, 1996, there
were no repurchases of stock.
The Company guarantees debt related to Ponderay which is discussed in Notes to
Consolidated Financial Statements in the 1995 Annual Report.
Quarterly dividends of $.17 per share on Class A common stock and $.017 per
share on Class B common stock were declared during the quarter. This represents
an increase over the prior year quarter of $.03 per share on the Class A common
stock and $.003 on the Class B common stock.
The Company has significant cash balances and a consistent ability to generate
cash flow from operations. The Company foresees no difficulty in maintaining its
present financial condition and liquidity. Funding for current and future
capital programs, the repurchase of Class A common stock, investment in
partnerships and projected working capital needs is considered adequate for the
foreseeable future.
<PAGE>12
Part II
CENTRAL NEWSPAPERS, INC.
Item 1. Legal Proceedings -- None
Item 2. Changes in Securities -- None
Item 3. Default Upon Senior Securities -- None
Item 4. Submission of Matters to a Vote of Security Holders -- None
Item 5. Other Information --
At a meeting held on March 19, 1996, the Company's Board of
Directors authorized the repurchase of up to 1,000,000 shares of
the Company's Class A common stock over a period of up to three
years. A copy of the press release issued in connection with the
share repurchase authorization is attached hereto as Exhibit 2.
Item 6. Exhibits and Reports on Form 8-K
a) Exhibit 1 -- Independent Accountant's Report
b) Exhibit 2 -- Press release relating to the authorization of a
1,000,000 share repurchase of Class A common stock.
c) The Company filed a report on Form 8-K on March 13, 1996. The
report was dated March 12, 1996 and reported the acquisition of
McCormick and Company, Inc., the parent company of the
Alexandria (Louisiana) Daily Town Talk. The report contained
audited financial statements for McCormick and Company, Inc.
for the fiscal year ended December 31, 1995 and also contained
a proforma balance sheet assuming the transactions occurred as
of December 31, 1995 and a proforma income statement that
assumed that the transaction was completed January 1, 1995.
<PAGE>13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
CENTRAL NEWSPAPERS, INC.
Dated: May 13, 1996 By:/s/Louis A. Weil, III
------------------
Louis A. Weil, III
President and Chief Executive
Officer
By:/s/Thomas K. MacGillivray
----------------------
Thomas K. MacGillivray
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains unaudited summary financial information extracted from
the consolidated statement of financial position of Central Newspapers, Inc. as
of March 31, 1996 and the consolidated statements of income, shareholders'
equity and cash flows for the fiscal three month period ended March 31, 1996 and
is qualified in its entirety by reference to such statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-29-1996
<PERIOD-END> MAR-31-1996
<CASH> 36205
<SECURITIES> 48846
<RECEIVABLES> 58224
<ALLOWANCES> 792
<INVENTORY> 10988
<CURRENT-ASSETS> 166406
<PP&E> 486375
<DEPRECIATION> 195959
<TOTAL-ASSETS> 567740
<CURRENT-LIABILITIES> 78719
<BONDS> 7178
0
0
<COMMON> 20162
<OTHER-SE> 344908
<TOTAL-LIABILITY-AND-EQUITY> 567740
<SALES> 147896
<TOTAL-REVENUES> 147896
<CGS> 0
<TOTAL-COSTS> 133597
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 168
<INCOME-PRETAX> 15892
<INCOME-TAX> 6592
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 9809
<EPS-PRIMARY> .37
<EPS-DILUTED> 0
</TABLE>
Exhibit 1
---------
INDEPENDENT ACCOUNTANT'S REPORT
To the Board of Directors
Central Newspapers, Inc.
We have reviewed the consolidated statement of financial position of Central
Newspapers, Inc. as of March 31, 1996, and the consolidated statements of
income, shareholders' equity and cash flows for the fiscal three-month periods
ended March 31, 1996 and March 26, 1995. These financial statements are the
responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the consolidated financial statements referred to above for them to
be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated statement of financial position as of December 31,
1995, and the related consolidated statements of income, shareholders' equity
and cash flows for the year then ended (not presented herein); and in our report
dated February 7, 1996, we expressed an unqualified opinion on those
consolidated financial statements.
/s/Geo. S. Olive & Co. LLC
- ---------------------------
Geo. S. Olive & Co. LLC
Indianapolis, Indiana
April 16, 1996
Exhibit 2
CENTRAL NEWSPAPERS, INC. AUTHORIZES 1,000,000 SHARE REPURCHASE
INDIANAPOLIS, IN, March 19, 1996 - Central Newspapers, Inc. Board of
Directors authorized the repurchase of up to 1,000,000 shares of the
corporation's Class A stock, Louis A. Weil, III, President and Chief Executive
Officer, announced today.
The shares may be purchased within the next three years on the open market
or in privately negotiated transactions. Central currently has 26.6 million
combined Class A and equivalent Class B shares outstanding.
Central Newspapers is a media company that publishes daily, Sunday and
weekly newspapers including the Arizona Republic and The Gazette in metropolitan
Phoenix, Arizona; The Star and The News in Indianapolis, Indiana, and the Daily
Town Talk in Alexandria, Louisiana, as well as smaller community papers in
Indiana and Louisiana. It is the 15th largest U.S. newspaper company in terms
of circulation.
