<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 9, 1998
PRIMEDIA INC.
(Exact name of registrant as specified in its charter)
Delaware 1-11106 13-3647573
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
745 Fifth Avenue, New York, New York 10151
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 745-0100
K-III Communications Corporation
(Former name or former address, if changed since last report)
Exhibit Index on Page 4
<PAGE>
Item 5. Other Events.
See financial information entitled Financial Highlights (Unaudited)
included in the News Release, dated January 28, 1998, attached hereto
as Exhibit 99.1
See News Release, dated February 6, 1998, attached hereto as
Exhibit 99.2
See News Release, dated February 6, 1998, attached hereto as
Exhibit 99.3
Item 7. Financial Statements and Exhibits.
(c) Exhibits
(99.1) Financial Highlights (Unaudited)
(99.2) News Release.
(99.3) News Release.
<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.
PRIMEDIA INC.
By: Beverly C. Chell
---------------------
Date: February 9, 1998 Beverly C. Chell
Vice Chairman and Secretary
<PAGE>
Index to Exhibits
Exhibit Number Description
- -------------- -----------
(99.1) Financial Highlights (Unaudited)
(99.2) News Release
(99.3) News Release
<PAGE>
Exhibit 99.1
PRIMEDIA INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE MONTHS TWELVE MONTHS
ENDED DECEMBER 31, ENDED DECEMBER 31,
---------------------------- ----------------------------
<S> <C> <C> <C> <C>
1997 1996 1997 1996
------------- ------------- ------------- -------------
Sales--Net.......................................... $ 397.6 $ 379.4 $ 1,487.6 $ 1,374.4
Operating Costs and Other Expenses.................. 307.6 291.5 1,185.6 1,097.8
------------- ------------- ------------- -------------
Earnings before Interest, Taxes, Depreciation,
Amortization and provision for one-time charges
(EBITDA).......................................... 90.0 87.9 302.0 276.6
Depreciation and Amortization and Other............. 58.5 50.8 184.2 190.7
Provision for loss on the sales of businesses, net
and other......................................... -- -- 138.6 --
------------- ------------- ------------- -------------
Operating Income (Loss)............................. 31.5 37.1 (20.8) 85.9
Interest Expense.................................... (32.9) (33.3) (136.6) (124.6)
Other Income (Expense), Net......................... 0.5 0.2 (1.7) 3.0
------------- ------------- ------------- -------------
Income (Loss) before Income Tax Benefit and
Extraordinary Charge.............................. (0.9) 4.0 (159.1) (35.7)
Income Tax Benefit.................................. -- 53.3 1.7 53.3
------------- ------------- ------------- -------------
Income (Loss) before Extraordinary Charge........... (0.9) 57.3 (157.4) 17.6
Extraordinary Charge--Extinguishment of Debt........ -- (2.0) (15.4) (9.6)
------------- ------------- ------------- -------------
Net Income (Loss)................................... (0.9) 55.3 (172.8) 8.0
Preferred Stock Dividends:
Recurring......................................... (12.5) (12.2) (49.8) (43.5)
Non-recurring..................................... (15.3) -- (15.3) --
------------- ------------- ------------- -------------
Earnings (Loss) Applicable to Common Shareholders... $ (28.7) $ 43.1 $ (237.9) $ (35.5)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Basic and Diluted Earnings (Loss) Applicable to
Common Shareholders per Common Share:
Income (Loss) before Extraordinary Charge......... $ (.22) $ .35(A) $ (1.72) $ (.20)
Extraordinary Charge.............................. -- (.02) (.12) (.07)
------------- ------------- ------------- -------------
Net Income (Loss)................................. $ (.22) $ .33(A) $ (1.84) $ (.27)
------------- ------------- ------------- -------------
Basic and Diluted Common Shares Outstanding......... 129,404,368 128,961,695(A) 129,304,900 128,781,518
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Note:
(A) For the fourth quarter of 1996, diluted earnings per share was
as follows:
Income before Extraordinary Charge.............................. $ .34
Extraordinary Charge............................................ (.02)
-------------
Net Income...................................................... $ .32
-------------
-------------
Diluted common shares outstanding:.............................. 133,866,122
-------------
-------------
SUPPLEMENTAL DISCLOSURE
Diluted Common Shares Outstanding presented below represent the shares which would have been used in computing
diluted earnings per share if the Company had income in all periods presented:
Diluted Common Shares Outstanding................... 132,710,786 131,855,324 132,511,115 132,071,336
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
OTHER DATA
Cash and cash equivalents....................................................... $ 22,978 $ 36,655
------------- -------------
------------- -------------
Long-term debt and other, including current maturities.......................... $ 1,721,110 $ 1,596,251
------------- -------------
------------- -------------
Preferred Stock................................................................. $ 470,280 $ 442,729
------------- -------------
------------- -------------
Capital Expenditures, net....................................................... $ 31,108 $ 28,790
------------- -------------
------------- -------------
</TABLE>
<PAGE>
Exhibit 99.2
For Immediate Release Contacts:
PRIMEDIA
Investors: Warren Bimblick 212-745-0615
Web-site: www.primediainc.com
PRIMEDIA To Issue New Preferred Stock and Senior Notes
New York, February 6, 1998 - PRIMEDIA Inc. (NYSE: PRM) announced the
following anticipated financing actions:
- PRIMEDIA intends to issue $175 million of new 12-year preferred stock
at a dividend rate to be determined. The proceeds will be used to
redeem all of its 11 5/8% Series B Preferred stock with the proceeds.
The new preferred issue will rank pari passu with the Company's
other outstanding preferred stock.
- PRIMEDIA intends to issue $200 million of 10-year Senior Notes at an
interest rate to be determined. The proceeds will be used to reduce
bank borrowings.
The new preferred stock and the new senior notes are both expected to be
issued in the next few weeks through private offerings in accordance with
Rule 144A of the Securities Act of 1933.
The securities offered will not be registered under the Securities Act of
1933 and may not be offered or sold in the United States absent registration
or an applicable exemption from registration requirements.
<PAGE>
Exhibit 99.3
For Immediate Release Contacts:
PRIMEDIA
Warren Bimblick 212-745-0615
Web-site: www.primediainc.com
PRIMEDIA Enhances Growth Opportunities
Investment Fund Managed by
Kohlberg Kravis Roberts & Co. Agrees to Purchase
$200 Million of New PRIMEDIA Common Shares
New York, February 6, 1998 - PRIMEDIA Inc. (NYSE: PRM) and Kohlberg
Kravis Roberts & Co., L.P. (KKR) announced that an investment fund managed by
KKR will purchase 16,666,667 new shares of PRIMEDIA common stock resulting in
net proceeds to the Company of $200 million. The issuance of the shares is
not expected to result in dilution to earnings in 1998. All of the proceeds
will be used to enhance PRIMEDIA's capital structure and fund growth
opportunities. The price per share was based on the seven day average price
of $12.77 less a discount, for net proceeds to the Company of $12.00 per
share.
Actions Enhance Growth Opportunities
"This new capital will help PRIMEDIA to accelerate its earnings growth in
1998 and beyond, particularly through new investment in product development,
joint ventures, technology, electronic products, international expansion and
licensing of our brands," said William F. Reilly, chairman and chief
executive officer of PRIMEDIA. "It will also help accelerate our ability to
acquire product lines in targeted niches that enhance our position in our six
growth platforms (specialty consumer magazines, technical and trade
magazines, classroom education, workplace education, consumer information and
business information).
<PAGE>
"KKR enabled this company to get started nine years ago, and their
support of our management team's growth strategy has been unwavering," said
Mr. Reilly. "We are pleased to have the opportunity to deleverage the Company
on attractive terms without subjecting the Company to market risks and other
costs associated with public market alternatives."
"PRIMEDIA is one of KKR's largest investments, and we believe that
PRIMEDIA is an excellent investment opportunity," said Michael T. Tokarz, a
member of Kohlberg Kravis Roberts & Co., and a director of PRIMEDIA. "We
are convinced that Bill Reilly and his management team, with this investment,
have the ability to accelerate the growth prospects for the Company."
An independent committee of the PRIMEDIA board of directors was advised
by Morgan Stanley & Co. Incorporated, and KKR was advised by Salomon Smith
Barney. It is anticipated that the transaction will close in about 30 days.
PRIMEDIA Inc. (formerly K-III Communications) is the authoritative source of
specialized information in targeted media (specialty magazines, technical and
trade magazines, consumer and business information) and education (classroom
learning and workplace learning). Some key brands include Seventeen, New
York, Chicago, Soap Opera Digest, Channel One, Weekly Reader, World Almanac,
Horticulture, Modern Bride, American Baby and Westcott.
This release contains certain forward-looking statements concerning
PRIMEDIA's operations, economic performance and financial condition. These
statements are based upon a number of assumptions and estimates which are
inherently subject to uncertainties and contingencies, many of which are
beyond the control of the Company, and reflect future business decisions
which are subject to change. Some of these assumptions may not materialize,
and unanticipated events will occur which can affect the Company's results.
