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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): July 22, 1998
THE TIMES MIRROR COMPANY
(Exact Name of Registrant as Specified in Charter)
Delaware 1-13492 95-4481525
(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
Times Mirror Square 90053
Los Angeles, California
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (213) 237-3700
None
(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS
In a press release dated July 22, 1998, The Times Mirror Company ("Times
Mirror") announced its earnings for the second quarter of 1998.
Attached as Exhibit 99 and incorporated herein by reference to this Form 8-K is
a copy of the press release dated July 22, 1998 of Times Mirror.
ITEM 7. EXHIBITS
(c) Exhibit
99 Press release issued by The Times Mirror Company
on July 22, 1998.
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SIGNATURES
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.
THE TIMES MIRROR COMPANY
Date: July 22, 1998 By: /s/ STEVEN J. SCHOCH
------------------------------
STEVEN J. SCHOCH
Vice President and
Treasurer
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Times Mirror Reports
Second Quarter Results
LOS ANGELES, CALIFORNIA, July 22, 1998 -- Times Mirror announced today
that net income before restructuring and one-time charges for the 1998 second
quarter was $73.9 million, or 76 cents per share on a diluted basis, compared
with $66.0 million, or 58 cents per share, in the prior year, an increase in
earnings per share of 31 percent.
"Our Eastern newspapers had an outstanding second quarter in 1998 and
led the way for our Newspaper Publishing segment with advertising growth of 8.8
percent," said Mark H. Willes, Times Mirror chairman, president and chief
executive officer, and publisher, Los Angeles Times. "Looking ahead to the
second half, we will continue to invest aggressively to build advertising and
circulation volume, particularly at the Los Angeles Times. We are also working
hard at managing administrative and other expenses, and we continue to make good
progress toward achieving our earnings goals for the year."
Income from continuing operations before restructuring and one-time
charges in the 1998 second quarter was $68.7 million, or 70 cents per share,
compared with $60.5 million, or 53 cents per share. For the 1998 second quarter,
Times Mirror's health sciences publisher, Mosby, Inc., and legal publisher,
Matthew Bender/Shepard's, are included for the first time in discontinued
operations. Discontinued operations reported income, net of taxes, of $5.2
million, or 6 cents per share, in the 1998 second quarter compared with $5.5
million, or 5 cents per share, in the prior year. The 1998 second-quarter
results include pre-tax restructuring and one-time charges of $39.7 million
($24.7 million after applicable income taxes), or 27 cents per share. Giving
effect to the restructuring and one-time charges and discontinued operations as
well as preferred dividends, the company's earnings applicable to common
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shareholders for the 1998 second quarter were $43.8 million, or 49 cents per
share, compared with $57.7 million, or 58 cents per share, in the prior year.
Revenues from continuing operations were $760.6 million in the 1998 second
quarter compared with $719.1 million in the prior year.
Discontinued Operations, Restructuring Program and Share Repurchases
Earlier this year, Times Mirror announced that it had reached
agreements to divest its legal publisher Matthew Bender & Company, its 50
percent ownership interest in legal citation provider Shepard's, and health
sciences publisher Mosby, Inc. Second requests for information have been
received from the Department of Justice in connection with the review of each
transaction. The company expects these reviews and the divestitures of Matthew
Bender, Shepard's and Mosby to be completed in the 1998 third quarter. While the
company will continue to operate these businesses until the closing of the
transactions, they are reported as discontinued operations in both years.
In anticipation of the expected benefits from the divestitures, the
company has begun a comprehensive review of its businesses, operating systems
and other investments to determine economically attractive actions it can take
to prepare for future growth. The 1998 second-quarter restructuring and one-time
charges result from the first portion of this program, which will continue
through the balance of the year. In aggregate, the company expects pre-tax
charges in 1998 from this program to be between $225 million to $275 million, or
$1.80 to $2.15 per share. The program is anticipated to produce an annual
expense savings of approximately $25 million, beginning in 1999.
In addition, the pace of share repurchase activity will be accelerated
to result in the repurchase of approximately 7.0 million shares in 1998. The
company has purchased 2.1 million shares through the 1998 second quarter.
First-Half 1998 Results
In the first half of 1998, net income before the second-quarter 1998
restructuring and one-time charges was
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$119.2 million, or $1.20 per share, compared with $111.2 million, or 94 cents
per share, in the first half of 1997. Income from continuing operations before
restructuring and one-time charges in the first half of 1998 was $113.3 million,
or $1.13 cents per share, compared with $102.8 million, or 85 cents per share,
in the prior year. For the first half of 1998, discontinued operations reported
income, net of taxes, of $5.8 million, or 6 cents per share, compared with $8.5
million, or 9 cents per share, in the first half of 1997. Revenues for the first
half of 1998 were $1.48 billion, compared with $1.40 billion in the prior year.
Giving effect to the 1998 second-quarter restructuring and one-time
charges and discontinued operations as well as preferred dividends, the
company's earnings applicable to common shareholders for the first half of 1998
were $83.6 million, or 92 cents per share, compared with $92.0 million, or 94
cents per share, in the prior year.
Segment results described below exclude the impact of restructuring and
one-time charges, except where noted.
Newspaper Publishing
For the 1998 second quarter, revenues for the Newspaper Publishing
segment rose 7.9 percent to $585.7 million, compared with $543.0 million in the
second quarter of 1997. Advertising revenues for the second quarter of 1998
increased by 8.3 percent to $454.8 million from last year's $419.9 million;
advertising revenues rose 7.8 percent at the Los Angeles Times and 8.8 percent
at the Eastern newspapers.
Daily circulation volume gains continued in the 1998 second quarter for
most of the company's newspapers, particularly at the Los Angeles Times. While
ongoing pricing and promotional discount programs continued, circulation
revenues in the quarter increased slightly to $109.6 million from $109.5 million
in the prior year's quarter. Other revenues rose to $21.3 million from $13.5
million in 1997, primarily reflecting incremental revenues from an acquisition.
The segment's 1998 second-quarter operating profit before restructuring
and one-time charges was $120.1 million compared with $115.3 million in the
previous year.
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Newsprint expense in the quarter rose 22 percent, as average
prices rose 12 percent and consumption increased 9 percent.
For the first half of 1998, Newspaper Publishing revenues were $1.13
billion compared with $1.05 billion in the first half of 1997. First half 1998
operating profit before restructuring and one-time charges was $210.3 million,
compared with $210.6 million in the prior year.
Including restructuring charges of $34.9 million, Newspaper Publishing
operating profit was $85.3 million in the 1998 second quarter.
Professional Information
The Professional Information segment's 1998 second-quarter results
reflect the pending disposition of Matthew Bender/Shepard's and Mosby which are
being reported as discontinued operations. Revenues from continuing operations
for the 1998 second quarter were $110.0 million, compared with $104.6 million in
the prior year. The segment's 1998 second-quarter operating profit before
restructuring and one-time charges was $17.1 million compared with $14.7 million
in the prior year.
For the first half of 1998, Professional Information revenues from
continuing operations were $215.8 million compared with $201.9 million in the
prior year. For the first half of 1998, operating profit before restructuring
and one-time charges was $34.0 million, compared with $26.8 million in the prior
year.
Including restructuring and one-time charges of $4.8 million,
Professional Information's operating profit was $12.2 million in the 1998 second
quarter.
Magazine Publishing
The Magazine Publishing segment reported 1998 second-quarter revenues
of $59.6 million, compared with $59.5 million in the prior year. The segment's
1998 second-quarter operating profit fell to $2.0 million compared to $5.3
million in the prior year's second quarter, due largely to ongoing investment in
the relaunch of The Sporting News and expenses related to new acquisitions.
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For the first half of 1998, Magazine Publishing revenues were $125.3
million compared with $117.4 million in the first half of 1997. First-half of
1998 operating profit was $1.7 million, compared with $7.9 million in the prior
year.
Corporate and Other
The Corporate and Other segment reported a 1998 second-quarter
operating loss of $16.1 million compared with $24.2 million last year.
Times Mirror (TMC--New York and Pacific Stock exchanges), a Los
Angeles-based news and information company, publishes the Los Angeles Times,
Newsday, The Baltimore Sun, The Hartford Courant, The Morning Call, The
(Stamford) Advocate and Greenwich Time; a wide array of professional information
for the legal, health improvement, aviation and training markets, and consumer
magazines. Times Mirror newspapers have won a total of 58 Pulitzer Prizes, among
the highest of any news and information company in the country.
###
Press Information Investor Information
Martha H. Goldstein Jean M. Jarvis
(213) 237-3727 (213) 237-3955
- --------------------------------------------------------------------------------
This press release contains certain forward-looking statements that are subject
to risk and uncertainty. There can be no assurance that these future results
will be achieved. Readers are cautioned to refer to the Company's Annual Report
on Form 10-k for the year ended December 31, 1997 filed with the Securities and
Exchange Commission for a description of factors which could affect the
Company's performance.
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THE TIMES MIRROR COMPANY
SUMMARY OF RESULTS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS AND PERCENTAGES)
<TABLE>
<CAPTION>
Second Quarter Ended
June 30,
---------------------------
1998 1997 % Change
----------- ----------- -----------
<S> <C> <C> <C>
REVENUES $760,574 $719,106 5.8
Operating expenses 637,568 607,999 4.9
Restructuring and one-time charges 39,697 100.0
-------- --------
OPERATING PROFIT 83,309 111,107 (25.0)
Interest expense, net (16,555) (7,672) 100.0+
Other, net 7,822 1,088 100.0+
-------- --------
Income from continuing operations before
income tax provision 74,576 104,523 (28.7)
Income tax provision 30,561 44,050 (30.6)
-------- --------
Income from continuing operations 44,015 60,473 (27.2)
Income from discontinued operations, net of
income taxes (a) 5,186 5,513 (5.9)
-------- --------
NET INCOME 49,201 65,986 (25.4)
Preferred dividend requirements 5,424 8,266 (34.4)
-------- --------
EARNINGS APPLICABLE TO COMMON SHAREHOLDERS $ 43,777 $ 57,720 (24.2)
======== ========
BASIC EARNINGS PER COMMON SHARE:
Continuing operations (b) $ 0.44 $ 0.54 (18.5)
Discontinued operations (a) 0.06 0.06 -
-------- --------
BASIC EARNINGS PER SHARE $ 0.50 $ 0.60 (16.7)
======== ========
DILUTED EARNINGS PER COMMON SHARE:
Continuing operations (b) $ 0.43 $ 0.53 (18.9)
Discontinued operations (a) 0.06 0.05 20.0
-------- --------
DILUTED EARNINGS PER SHARE $ 0.49 $ 0.58 (15.5)
======== ========
Weighted average shares:
Basic 87,844 96,469 (8.9)
======== ========
Diluted 90,277 101,447 (11.0)
======== ========
</TABLE>
- ----------
(a) Results for discontinued operations include Matthew Bender & Company,
Incorporated, a publisher of legal information; Mosby, Inc., a publisher of
health science information; Shepard's joint venture, a primary legal citation
service, and the consolidation of certain activities with Classified Ventures.
Prior year financial statements have been restated to conform to the 1998
presentation.
(b) A comparison of 1998 earnings per share from continuing operations,
excluding restructuring and one-time charges, is as follows:
<TABLE>
<CAPTION>
Basic Diluted
----- -------
<S> <C> <C>
Earnings per share from continuing operations $0.44 $0.43
Add: Restructuring and one-time charges 0.28 0.27
----- -----
Earnings per share from continuing operations
excluding restructuring and one-time charges $0.72 $0.70
===== =====
</TABLE>
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THE TIMES MIRROR COMPANY
SUMMARY OF RESULTS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS AND PERCENTAGES)
<TABLE>
<CAPTION>
Year To Date Ended
June 30,
-------------------------
1998 1997 % Change
----------- ---------- ---------
<S> <C> <C> <C>
REVENUES $1,478,226 $1,399,445 5.6
Operating expenses 1,267,863 1,206,199 5.1
Restructuring and one-time charges 39,697 100.0
---------- ----------
OPERATING PROFIT 170,666 193,246 (11.7)
Interest expense, net (26,980) (14,558) 85.3
Other, net 7,333 274 100.0+
---------- ----------
Income from continuing operations before
income tax provision 151,019 178,962 (15.6)
Income tax provision 62,375 76,201 (18.1)
---------- ----------
Income from continuing operations 88,644 102,761 (13.7)
Income from discontinued operations, net of
income taxes (a) 5,818 8,458 (31.2)
---------- ----------
NET INCOME 94,462 111,219 (15.1)
Preferred dividend requirements 10,848 19,177 (43.4)
---------- ----------
EARNINGS APPLICABLE TO COMMON SHAREHOLDERS $ 83,614 $ 92,042 (9.2)
========== ==========
BASIC EARNINGS PER COMMON SHARE:
Continuing operations (b) $ 0.88 $ 0.88 --
Discontinued operations (a) 0.07 0.09 (22.2)
---------- ----------
BASIC EARNINGS PER SHARE $ 0.95 $ 0.97 (2.1)
========== ==========
DILUTED EARNINGS PER COMMON SHARE:
Continuing operations (b) $ 0.86 $ 0.85 1.2
Discontinued operations (a) 0.06 0.09 (33.3)
---------- ----------
DILUTED EARNINGS PER SHARE $ 0.92 $ 0.94 (2.1)
---------- ----------
Weighted average shares:
Basic 88,088 95,213 (7.5)
---------- ----------
Diluted 90,507 97,637 (7.3)
---------- ----------
</TABLE>
(a) Results for discontinued operations include Matthew Bender & Company,
Incorporated, a publisher of legal information; Mosby, Inc., a publisher of
health science information; Shepard's joint venture, a primary legal citation
service; the consolidation of certain activities with Classified Ventures, and,
in 1997, CRC Press, Inc., a publisher of scientific and technical information.
Prior year financial statements have been restated to conform to the 1998
presentation.
(b) A comparison of 1998 earnings per share from continuing operations,
excluding restructuring and one-time charges, is as follows:
<TABLE>
<CAPTION>
Basic Diluted
----- -------
<S> <C> <C>
Earnings per share from continuing operations $0.88 $0.86
Add: Restructuring and one-time charges 0.28 0.27
----- -----
Earnings per share from continuing operations
excluding restructuring and one-time charges $1.16 $1.13
====== =====
</TABLE>
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THE TIMES MIRROR COMPANY
BUSINESS SEGMENTS
(IN THOUSANDS)
<TABLE>
<CAPTION>
Pro Forma (a)
Second Quarter Ended Second Quarter Ended
June 30, June 30,
------------------------------ --------------------------------
1998 1997 1998 1997
------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
NEWSPAPER PUBLISHING
Revenues $585,731 $542,958 $585,731 $542,958
Operating Profit 85,259 115,295 120,109 115,295
PROFESSIONAL INFORMATION
Revenues $110,049 $104,581 $110,049 $104,581
Operating Profit 12,204 14,699 17,051 14,699
MAGAZINE PUBLISHING
Revenues $ 59,623 $ 59,511 $ 59,623 $ 59,511
Operating Profit 1,953 5,268 1,953 5,268
CORPORATE AND OTHER
Revenues $ 4,966 $ 12,179 $ 4,966 $ 12,179
Operating Loss (16,107) (24,155) (16,107) (24,155)
CONTINUING OPERATIONS
Revenues $760,574 $719,106 $760,574 $719,106
Operating Profit 83,309 111,107 123,006 111,107
</TABLE>
- -------------------------------------
(a) Excludes restructuring and one-time charges in 1998 as follows:
Newspaper Publishing $34,850
Professional Information 4,847
-------
$39,697
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THE TIMES MIRROR COMPANY
BUSINESS SEGMENTS
(IN THOUSANDS)
<TABLE>
<CAPTION>
Pro Forma (a)
Year To Date Ended Year To Date Ended
June 30, June 30,
----------------------------------- -------------------------------------
1998 1997 1998 1997
---------------- ---------------- ----------------- -----------------
<S> <C> <C> <C> <C>
NEWSPAPER PUBLISHING
Revenues $1,128,652 $1,054,470 $1,128,652 $1,054,470
Operating Profit 175,413 210,559 210,263 210,559
PROFESSIONAL INFORMATION
Revenues $ 215,783 $ 201,941 $ 215,783 $ 201,941
Operating Profit 29,162 26,825 34,009 26,825
MAGAZINE PUBLISHING
Revenues $ 125,268 $ 117,387 $ 125,268 $ 117,387
Operating Profit 1,730 7,859 1,730 7,859
CORPORATE AND OTHER
Revenues $ 8,689 $ 26,014 $ 8,689 $ 26,014
Operating Loss (35,639) (51,997) (35,639) (51,997)
CONTINUING OPERATIONS
Revenues $1,478,226 $1,399,445 $1,478,226 $1,399,445
Operating Profit 170,666 193,246 210,363 193,246
- --------------------------------
(a) Excludes restructuring and one-time charges in 1998 as follows:
Newspaper Publishing $34,850
Professional Information 4,847
-------
$39,697
=======
</TABLE>
