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The New York Times Company Reports 2012 Second-Quarter Results



  The New York Times Company Reports 2012 Second-Quarter Results

Business Wire

NEW YORK -- July 26, 2012

The New York Times Company (NYSE: NYT) announced today a 2012 second-quarter
diluted loss per share from continuing operations of $.57 compared with
diluted earnings per share from continuing operations of $.05 in the same
period of 2011. The loss resulted from an estimated non-cash charge of $.85
per share for the write-down of goodwill at the About Group. Excluding
severance, the write-down and other special items discussed below, diluted
earnings per share from continuing operations were $.14 in the second quarter
of 2012 compared with $.11 in the second quarter of 2011.

The Company had an operating loss of $143.6 million in the second quarter of
2012 compared with an operating profit of $31.5 million in the same period of
2011. Excluding depreciation, amortization, severance and special items,
operating profit increased 6.5 percent to $78.1 million from $73.4 million in
the second quarter of 2011.

“Our second-quarter results reflect our ongoing strides in repositioning the
Times Company for an increasingly multiplatform future,” said Arthur
Sulzberger, Jr., chairman and chief executive officer, The New York Times
Company. “The growth in operating profit, excluding depreciation,
amortization, severance and special items, was largely driven by continued
strength in circulation revenues, which offset advertising revenue declines
and led to overall revenue growth of about 1 percent. Total Company
circulation revenues rose 8 percent, led by the nearly 11 percent growth at
The New York Times Media Group as we continued to expand our digital
subscription base and grow our robust consumer revenue stream.

“At quarter end, total paid digital subscriptions across the Company were
approximately 532,000, up 13 percent from 472,000 as of March 18, 2012, which
was the one-year anniversary of NYTimes.com’s digital subscription launch. The
growth in paid digital subscriptions benefited from our decision to move the
gate on NYTimes.com from 20 to 10 free articles a month, and from a host of
marketing and product initiatives that we have been rolling out this year.

“While the advertising market remains challenging, the rate of decline for the
Company’s total advertising revenues moderated, due primarily to improved
digital advertising revenue trends, compared with first-quarter 2012 levels.
This was mainly due to more favorable advertising trends at the About Group,
particularly for cost-per-click advertising. Although we recorded a non-cash
charge in the quarter, the About Group continues to execute on its turnaround
strategy and we expect it to be on track to post continued meaningful
improvement in the second half of the year.

“Operating costs declined 1 percent as we remained diligent in managing
expenses despite continued investment in digital operations and high-quality
news and information across the Company.

“During the quarter we sold our remaining interest in Fenway Sports Group for
$63 million. The sale of our entire stake over two years totaled $225 million,
a three-fold return on the initial purchase price. The proceeds from this
sale, along with solid cash flow from operations, further strengthened our
liquidity position and we ended the quarter with total debt and capital lease
obligations of $776 million and net debt of $206 million, down from $343
million at the end of the first quarter of 2012.”

Comparisons

Unless otherwise noted, all comparisons are for the second quarter of 2012 to
the second quarter of 2011. The results of the Regional Media Group, which had
previously been included in the News Media Group, are reported within
discontinued operations for all periods presented as a result of the sale of
the Group in the first quarter of 2012. This release includes non-GAAP
financial measures, a discussion of management’s reasons for the presentation
of these non-GAAP financial measures and reconciliations to the most
comparable GAAP financial measures.

The second-quarter 2012 results included the following special items:

  * A $194.7 million ($126.1 million after tax or $.85 per share) estimated
    non-cash charge for the write-down of goodwill at the About Group.
  * A $37.8 million ($22.0 million after tax or $.15 per share) gain on the
    sale of the Company’s remaining 210 units in Fenway Sports Group (FSG).

The second-quarter 2011 results included the following special items:

  * A $9.2 million ($5.8 million after tax or $.04 per share) non-cash charge
    for the write-down of certain assets held for sale at the News Media
    Group.
  * A $4.2 million ($2.7 million after tax or $.02 per share) charge for a
    pension withdrawal obligation under a multiemployer pension plan at The
    Boston Globe.

In addition to these special items, the Company had $1.8 million ($1.1 million
after tax or $.01 per share) in severance costs in the second quarter of 2012
compared with $1.8 million ($1.1 million after tax or $.00 per share) in the
second quarter of 2011.

Second-Quarter Results from Continuing Operations

Revenues

Total revenues increased 0.6 percent to $515.2 million from $512.0 million.
Advertising revenues decreased 6.8 percent, circulation revenues increased 8.3
percent and other revenues increased 9.2 percent.

Print advertising revenues decreased 8.0 percent. Digital advertising revenues
decreased 4.0 percent led by declines at the About Group. Circulation revenues
rose mainly as the addition of digital subscription offerings and the increase
in home-delivery and weekday single-copy prices in January 2012 at The Times
offset a decline in print copies sold across the News Media Group. Other
revenues increased largely because of higher commercial printing revenues at
the New England Media Group.

Operating Costs

Operating costs decreased 0.6 percent to $464.1 million from $467.0 million.
Depreciation and amortization decreased to $25.2 million from $26.6 million.

Excluding depreciation, amortization and severance, operating costs decreased
0.3 percent to $437.1 million from $438.6 million mainly due to lower
professional fees and distribution costs, offset in part by higher
compensation and various other costs.

Second-Quarter Business Segment Results

News Media Group

Total News Media Group revenues increased 1.2 percent to $489.8 million from
$484.1 million. Advertising revenues declined 6.6 percent, circulation
revenues increased 8.3 percent and other revenues increased 9.8 percent.

Print and digital advertising revenues decreased 8.0 percent and 1.6 percent,
respectively. Circulation revenues rose mainly as the addition of digital
subscription offerings and the increase in home-delivery and weekday
single-copy prices in January 2012 at The Times offset a decline in print
copies sold across the News Media Group.

Operating costs decreased 0.8 percent to $437.6 million from $441.3 million.
Excluding depreciation, amortization and severance, operating costs decreased
0.8 percent to $412.8 million from $416.0 million mainly due to lower
distribution and promotion costs, offset by higher compensation costs.

Operating profit increased 77.5 percent to $52.2 million from $29.4 million.
Excluding depreciation, amortization, severance and special items, operating
profit increased 12.9 percent to $77.0 million from $68.1 million primarily
due to higher circulation revenues.

About Group

About Group revenues decreased 8.7 percent to $25.4 million from $27.8 million
mainly due to declines in both display and cost-per-click advertising. Display
advertising revenues were lower in the quarter as the competitive landscape
and uneven economic environment offset progress made in the rebuilding of
About.com’s sales team. Cost-per-click advertising revenues reflect lower
click-through rates, slightly offset by modest growth in page views and
cost-per-click advertising rates.

About Group operating costs increased 6.9 percent to $17.5 million from $16.4
million. Excluding depreciation, amortization and severance, operating costs
increased 15.1 percent to $15.2 million from $13.2 million primarily due to
higher compensation, content costs and marketing expenses resulting from the
launch of a new ad campaign.

The About Group had an operating loss of $186.8 million in the second quarter
of 2012 driven by the estimated non-cash charge for the write-down of goodwill
compared with operating profit of $11.5 million in the second quarter of 2011.
Excluding depreciation, amortization, severance and the write-down, operating
profit decreased 30.4 percent to $10.2 million from $14.6 million.

Corporate

Corporate operating costs decreased to $9.0 million from $9.4 million mainly
driven by lower professional fees, partially offset by increases in various
other costs.

Other Financial Data

Digital

Digital businesses include NYTimes.com, BostonGlobe.com, Boston.com,
About.com, other Company Web sites and related digital products. In the second
quarter of 2012, total digital advertising revenues decreased 4.0 percent to
$76.7 million from $79.9 million primarily due to lower revenues at the About
Group. Digital advertising revenues as a percentage of total Company
advertising revenues were 31.4 percent in the second quarter of 2012 compared
with 30.5 percent in the second quarter of 2011.

Digital advertising revenues at the News Media Group decreased 1.6 percent to
$52.6 million from $53.5 million mainly due to declines in national display
and real estate classified advertising revenues. Digital advertising revenues
as a percentage of total News Media Group advertising revenues were 23.9
percent in the second quarter of 2012 compared with 22.7 percent in the second
quarter of 2011.

In the first half of 2012, the Company’s total digital advertising revenues
decreased 7.2 percent to $147.8 million from $159.2 million in the first half
of 2011. Digital advertising revenues at the News Media Group decreased 1.9
percent to $101.1 million from $103.1 million. Digital advertising revenues as
a percentage of total Company advertising revenues were 30.7 percent for the
first half of 2012 compared with 30.6 percent in the first half of 2011.

Paid subscribers to digital subscription packages, e-readers and replica
editions of The Times and the International Herald Tribune totaled
approximately 509,000 as of the end of the second quarter, an increase of
approximately 12 percent since March 18, 2012. Paid digital subscribers to
BostonGlobe.com and The Boston Globe’s e-readers and replica editions totaled
approximately 23,000 as of the end of the second quarter, up approximately 28
percent since March 18, 2012.

Joint Ventures

Income from joint ventures was $1.1 million in the second quarter of 2012
compared with $2.8 million in the second quarter of 2011. Joint venture
results for the second quarter of 2012 were primarily impacted by the change
in accounting for the Company’s investment in FSG in the first quarter of
2012, offset in part by improved results for the paper mills. Effective with
the sale of 100 units in FSG in February 2012, given the Company’s reduced
ownership level and lack of influence on the operations of FSG, the Company no
longer recognized its proportionate share of the operating results of FSG in
results from joint ventures. In May 2012, the Company sold its remaining 210
units in FSG.

Interest Expense, net

Interest expense, net decreased to $15.5 million from $25.2 million mainly due
to the prepayment of the Company’s $250 million 14.053 percent senior notes in
August 2011.

Income Taxes

The Company had an income tax benefit of $36.5 million (effective tax rate of
30.4 percent) in the second quarter of 2012 and an income tax benefit of $32.5
million (effective tax rate of 31.5 percent) in the first six months of 2012.
The effective tax rate for the second quarter and first six months of 2012 was
unfavorably impacted by the write-down of goodwill at the About Group.

The Company had an effective tax rate of 16.5 percent and 8.6 percent in the
second quarter and the first six months of 2011, respectively. The effective
tax rate for the second quarter and first six months of 2011 was affected by
adjustments to reduce the Company’s reserve for uncertain tax positions and
the favorable impact of state law changes.

Liquidity

The following table details the original maturities and carrying values of the
Company’s debt and capital lease obligations as of June 24, 2012. Cash in the
table below excludes restricted cash of approximately $24 million that is
subject to certain collateral requirements. Net debt represents debt and
capital lease obligations, net of cash and short-term investments. The Company
believes net debt, a non-GAAP measure, provides a useful measure of the
Company’s liquidity and overall debt position.

(in thousands)                                                  June 24, 2012*
2012    4.610% senior notes                                     $  75,000
2015    5.0% senior notes                                       250,000
2016    6.625% senior notes                                     225,000
2019    Option to repurchase ownership interest in              250,000      
headquarters building
Total                                                           $  800,000
Less: Unamortized amounts                                       (31,304     )
Carrying value of debt                                          $  768,696
Capital lease obligations                                       7,119        
Total debt and capital lease obligations                        $  775,815
Less: Cash and short-term investments                           (570,149    )
Net debt                                                        $  205,666   

*As of March 25, 2012, net debt was $342,937, reflecting $774,283 of total
debt and capital lease obligations, less $431,346 of cash and short-term
investments.

The Company’s liquidity position improved by approximately $139 million in the
second quarter of 2012 from the first quarter of 2012 due to proceeds from the
sale of the Company’s remaining 210 units in FSG and cash flows from
operations.

As of June 24, 2012, there were no outstanding borrowings under the Company’s
$125 million revolving credit facility.

Capital Expenditures

Capital expenditures totaled approximately $10 million in the second quarter
of 2012, and approximately $17 million in the first six months of 2012.

Outlook

Total advertising revenue trends in the third quarter of 2012 are expected to
improve from the second-quarter levels due to better digital advertising
performance across the Company.

Total circulation revenues are projected to increase in the mid- to
high-single digits in the third quarter of 2012 because of growth in digital
subscriptions as well as from the print price increases implemented earlier
this year.

The Company expects operating costs to increase in the low- to mid-single
digits in the third quarter of 2012.

In addition, the Company expects the following on a pre-tax basis in 2012:

  * Results from joint ventures: $6 to $8 million,
  * Depreciation and amortization: $105 to $110 million,
  * Interest expense, net: $60 to $65 million, and
  * Capital expenditures: approximately $50 million.

Conference Call Information

The Company’s second-quarter 2012 earnings conference call will be held on
Thursday, July 26, at 11:00 a.m. E.T. To access the call, dial 888-713-4487
(in the U.S.) and 913-981-5544 (international callers). Participants should
dial into the conference call approximately 10 minutes before the start time.
Online listeners can link to the live webcast at www.nytco.com/investors.

An archive of the webcast will be available beginning two hours after the call
at www.nytco.com/investors. The archive will be available for approximately
three months. An audio replay will be available at 888-203-1112 (in the U.S.)
and 719-457-0820 (international callers) beginning approximately two hours
after the call until 5 p.m. E.T. on Friday, July 27. The access code is
8424737.

Except for the historical information contained herein, the matters discussed
in this press release are forward-looking statements that involve risks and
uncertainties that could cause actual results to differ materially from those
predicted by such forward-looking statements. These risks and uncertainties
include national and local conditions, as well as competition, that could
influence the levels (rate and volume) of national, retail and classified
advertising and circulation generated by our various markets, material
increases in newsprint prices and the development of our digital businesses.
They also include other risks detailed from time to time in the Company’s
publicly filed documents, including the Company’s Annual Report on Form 10-K
for the year ended December 25, 2011. The Company undertakes no obligation to
publicly update or revise any forward-looking statement, whether as a result
of new information, future events or otherwise.

The New York Times Company, a leading global, multimedia news and information
company with 2011 revenues of $2.3 billion, includes The New York Times, the
International Herald Tribune, The Boston Globe, NYTimes.com, BostonGlobe.com,
Boston.com, About.com and related properties. The Company’s core purpose is to
enhance society by creating, collecting and distributing high-quality news,
information and entertainment.

This press release can be downloaded from www.nytco.com

             
Exhibits:     Condensed Consolidated Statements of Operations
              Segment Information
              News Media Group Revenues by Operating Segment
              Advertising Revenues by Category
              Footnotes
              Reconciliation of Non-GAAP Information
               

                                                             
THE NEW YORK TIMES COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars and shares in thousands, except per share data)
                      Second Quarter                              Six Months
                      2012            2011           %            2012            2011             %
                                                     Change                                        Change
Revenues
Advertising           $ 244,259       $ 262,104      -6.8%        $ 482,127       $ 521,035        -7.5%
Circulation           233,291         215,388        8.3%         460,285         422,316          9.0%
Other^(a)             37,662          34,496         9.2%         72,176          69,301           4.1%
Total revenues        515,212         511,988        0.6%         1,014,588       1,012,652        0.2%
Operating costs
Production costs      212,698         209,848        1.4%         425,890         424,854          0.2%
Selling, general
and                   226,223         230,595        -1.9%        460,501         464,661          -0.9%
administrative
costs
Depreciation and      25,183          26,600         -5.3%        57,473          52,273           9.9%
amortization^(b)
Total operating       464,104         467,043        -0.6%        943,864         941,788          0.2%
costs
Write-down of         194,732         9,225          *            194,732         9,225            *
assets^(c)
Pension
withdrawal            —               4,228          N/A          —               4,228            N/A
expense^(d)
Operating             (143,624  )     31,492         *            (124,008  )     57,411           *
(loss)/profit
Gain on sale of       37,797          —              N/A          55,645          5,898            *
investments^(e)
Write-down of         —               —              N/A          4,900           —                N/A
investments^(f)
Income/(loss)
from joint            1,079           2,791          -61.3%       1,050           (2,958     )     *
ventures
Interest expense,     15,464          25,152         -38.5%       30,916          49,743           -37.8%
net
(Loss)/income
from continuing       (120,212  )     9,131          *            (103,129  )     10,608           *
operations before
income taxes
Income tax            36,541          (1,505     )   *            32,465          (909       )     *
benefit/(expense)
(Loss)/income
from continuing       (83,671   )     7,626          *            (70,664   )     9,699            *
operations
(Loss)/income
from discontinued
operations, net       (4,505    )     (127,449   )   -96.5%       24,565          (124,296   )     *
of income
taxes^(g)
Net loss              (88,176   )     (119,823   )   -26.4%       (46,099   )     (114,597   )     -59.8%
Net loss
attributable to
the                   27              105            -74.3%       80              298              -73.2%
noncontrolling
interest
Net loss
attributable to
The New York          $ (88,149 )     $ (119,718 )   -26.4%       $ (46,019 )     $ (114,299 )     -59.7%
Times Company
common
stockholders
                                                                                                    
Amounts
attributable to
The New York
Times Company
common
stockholders:
(Loss)/income
from continuing       $ (83,644 )     $ 7,731        *            $ (70,584 )     $ 9,997          *
operations
(Loss)/income
from discontinued     (4,505    )     (127,449   )   -96.5%       24,565          (124,296   )     *
operations, net
of income taxes
Net loss              $ (88,149 )     $ (119,718 )   -26.4%       $ (46,019 )     $ (114,299 )     -59.7%
                                                                                                    
Average number of
common shares
outstanding:
Basic                 148,005         147,176        0.6%         147,936         146,976          0.7%
Diluted               148,005         151,802        -2.5%        147,936         152,945          -3.3%
                                                                                                    
Basic
(loss)/earnings
per share
attributable to
The New York
Times Company
common
stockholders:
(Loss)/income
from continuing       $ (0.57   )     $ 0.05         *            $ (0.48   )     $ 0.07           *
operations
(Loss)/income
from discontinued     (0.03     )     (0.86      )   -96.5%       0.17            (0.85      )     *
operations, net
of income taxes
Net loss              $ (0.60   )     $ (0.81    )   -25.9%       $ (0.31   )     $ (0.78    )     -60.3%
                                                                                                    
Diluted
(loss)/earnings
per share
attributable to
The New York
Times Company
common
stockholders:
(Loss)/income
from continuing       $ (0.57   )     $ 0.05         *            $ (0.48   )     $ 0.06           *
operations
(Loss)/income
from discontinued     (0.03     )     (0.84      )   -96.4%       0.17            (0.81      )     *
operations, net
of income taxes
Net loss              $ (0.60   )     $ (0.79    )   -24.1%       $ (0.31   )     $ (0.75    )     -58.7%
* Represents an increase or decrease in excess of 100%.                                             
See footnotes page for additional information.
                                                                                                    

                 
THE NEW YORK TIMES COMPANY
SEGMENT INFORMATION
(Dollars in thousands)
                                                                                                     
                    Second Quarter                              Six Months
                    2012             2011            %          2012              2011              %
                                                     Change                                         Change
Revenues
News Media          $ 489,802        $ 484,144       1.2%       $ 965,234         $ 953,666         1.2%
Group
About Group         25,410           27,844          -8.7%      49,354            58,986            -16.3%
Total               $ 515,212        $ 511,988       0.6%       $ 1,014,588       $ 1,012,652       0.2%
                                                                                                     
Operating
Profit/(Loss)
News Media          $ 52,211         $ 29,422        77.5%      $ 75,285          $ 55,298          36.1%
Group
About Group         (186,827   )     11,475          *          (179,831    )     25,622            *
Corporate           (9,008     )     (9,405    )     -4.2%      (19,462     )     (23,509     )     -17.2%
Total               $ (143,624 )     $ 31,492        *          $ (124,008  )     $ 57,411          *
                                                                                                     
Operating Profit/(Loss) Before Depreciation & Amortization, Severance and Special Items^(h)
News Media          $ 76,959         $ 68,144        12.9%      $ 133,002         $ 117,616         13.1%
Group
About Group         10,168           14,602          -30.4%     19,338            31,522            -38.7%
Corporate           (8,992     )     (9,353    )     -3.9%      (17,023     )     (23,457     )     -27.4%
Total               $ 78,135         $ 73,393        6.5%       $ 135,317         $ 125,681         7.7%
                                                                                                     
*Represents a decrease in excess of 100%.
See footnotes page for additional information.
 

 
THE NEW YORK TIMES COMPANY
NEWS MEDIA GROUP REVENUES BY OPERATING SEGMENT
(Dollars in thousands)
 
                      2012
                                         % Change                     % Change
                      Second Quarter     vs.          Six Months      vs.

                                         2011                         2011
The New York
Times Media
Group
Advertising           $  171,129         -6.9%        $ 344,488       -5.7%
Circulation           194,208            10.6%        384,175         11.7%
Other                 22,503             1.0%         43,226          -5.0%
Total                 $  387,840         1.6%         $ 771,889       2.3%
                                                                       
New England
Media Group
Advertising           $  49,099          -5.3%        $ 90,974        -8.6%
Circulation           39,083             -1.9%        76,110          -3.0%
Other                 13,780             28.2%        26,261          25.7%
Total                 $  101,962         -0.5%        $ 193,345       -2.8%
                                                                       
Total News Media
Group
Advertising           $  220,228         -6.6%        $ 435,462       -6.3%
Circulation           233,291            8.3%         460,285         9.0%
Other^(a)             36,283             9.8%         69,487          4.7%
Total                 $  489,802         1.2%         $ 965,234       1.2%
                                                                       
See footnotes page for additional information.
                                                                       

 
THE NEW YORK TIMES COMPANY
ADVERTISING REVENUES BY CATEGORY
(Dollars in thousands)
 
                      2012
                                         % Change                     % Change
                      Second Quarter     vs.          Six Months      vs.

                                         2011                         2011
News Media Group
National              $  147,486         -6.1%        $ 292,883       -6.1%
Retail                35,971             -2.8%        70,272          -1.8%
Classified:
Help-Wanted           7,121              -3.7%        14,171          -4.6%
Real Estate           10,806             -17.1%       20,783          -17.0%
Automotive            5,518              -12.5%       11,329          -9.9%
Other                 7,039              -9.9%        14,494          -7.9%
Total Classified      30,484             -11.7%       60,777          -10.9%
Other                 6,287              -11.0%       11,530          -14.0%
Total News Media      220,228            -6.6%        435,462         -6.3%
Group
                                                                       
About Group           24,031             -8.9%        46,665          -16.7%
                                                       
Total Company         $  244,259         -6.8%        $ 482,127       -7.5%
                                                                       

 
THE NEW YORK TIMES COMPANY
FOOTNOTES
(Dollars in thousands)
     
      Other revenues consist primarily of revenues from news services/syndication,
(a)   commercial printing, rental income, digital archives and direct mail
      advertising services.
                                                                      
      Includes $6.7 million of accelerated depreciation expense in the first
      quarter of 2012 for certain assets at the Worcester Telegram & Gazette’s
(b)   facility in Millbury, Mass., associated with the consolidation of most of its
      printing into The Boston Globe’s facility in Boston, Mass., in the second
      quarter of 2012.
                                                                        
      In the second quarter of 2012, the Company recorded a $194.7 million non-cash
(c)   charge for the write-down of goodwill at the About Group. In the second
      quarter of 2011, the Company recorded a $9.2 million non-cash charge for the
      write-down of certain assets held for sale at the News Media Group.
                                                                        
      In the second quarter of 2011, the Company recorded a $4.2 million charge for
(d)   a pension withdrawal obligation under a multiemployer pension plan at The
      Boston Globe.
                                                                        
      In the second quarter of 2012, the Company recorded a $37.8 million gain on
      the sale of its remaining 210 units in Fenway Sports Group. In the first
(e)   quarter of 2012, the Company recorded a $17.8 million gain on the sale of 100
      of its units in Fenway Sports Group. In the first quarter of 2011, the
      Company recorded a $5.9 million gain on the sale of a portion of the
      Company’s interest in Indeed.com, a job listing aggregator.
                                                                        
(f)   In the first quarter of 2012, the Company recorded a $4.9 million non-cash
      charge for a write-down of certain investments.
                                                                        
      On January 6, 2012, the Company completed the sale of its Regional Media
      Group, consisting of 16 regional newspapers, other print publications and
      related businesses. The results of the Regional Media Group, which had
(g)   previously been included in the News Media Group, have been classified as
      discontinued operations for all periods presented. In the second quarter of
      2012, we recorded post-closing adjustments related to the sale totaling $4.5
      million after-tax.
       
      The following tables summarize the results of operations presented as
      discontinued operations:
                                                                        
                        Second Quarter                  Six Months
                        2012           2011             2012           2011
      Revenues          $ —            $ 64,714         $ 6,115        $ 130,554
      Total
      operating         —              58,190           8,017          118,875
      costs
      Write-down of     —              152,093          —              152,093     
      assets
      Pre-tax loss      —              (145,569   )     (1,902   )     (140,414   )
      Income tax        —              18,120           736            16,118      
      benefit
      Loss from
      discontinued
      operations,       —              (127,449   )     (1,166   )     (124,296   )
      net of income
      taxes
      (Loss)/gain
      on sale, net
      of income
      taxes:
      Loss on sale      (7,026   )     —                (4,717   )     —
      Income tax        2,521          —                30,448     *   —           
      benefit
      (Loss)/gain
      on sale, net      (4,505   )     —                25,731         —           
      of income
      taxes
      (Loss)/income
      from
      discontinued      $ (4,505 )     $ (127,449 )     $ 24,565       $ (124,296 )
      operations,
      net of income
      taxes
      * Tax benefit is primarily due to a tax
      deduction for goodwill.
                                                                        
      See “Reconciliation of Non-GAAP Information” for reconciliations of operating
(h)   (loss)/profit to operating profit/(loss) before depreciation, amortization,
      severance and special items.
       

 
THE NEW YORK TIMES COMPANY
RECONCILIATION OF NON-GAAP INFORMATION
 
 
In this release, the Company has included non-GAAP financial information with
respect to diluted earnings per share from continuing operations excluding
severance and special items (if any), operating profit/(loss) before
depreciation, amortization, severance and special items (if any) and operating
costs before depreciation, amortization, severance and raw materials. The
Company has included these non-GAAP financial measures because management
reviews them on a regular basis and uses them to evaluate and manage the
performance of the operations. Management believes that, for the reasons
outlined below, these non-GAAP financial measures provide useful information
to investors as a supplement to reported diluted earnings/(loss) per share
from continuing operations, operating profit/(loss) and operating costs.
However, these measures should be evaluated only in conjunction with the
comparable GAAP financial measures and should not be viewed as alternative or
superior measures of GAAP results.
 
Diluted earnings per share from continuing operations excluding severance and
special items provide useful information in evaluating the Company’s
period-to-period performance because it eliminates items that the Company does
not consider to be indicative of earnings from ongoing operating activities.
Operating profit/(loss) before depreciation, amortization, severance and
special items (if any) is useful in evaluating the Company’s ongoing
performance of its businesses as it excludes the significant non-cash impact
of depreciation and amortization as well as items not indicative of ongoing
operating activities. Total operating costs include depreciation,
amortization, severance and raw materials. Total operating costs excluding
these items provide investors with helpful supplemental information on the
Company’s underlying operating costs that is used by management in its
financial and operational decision-making.
 
Reconciliations of these non-GAAP financial measures from, respectively,
diluted (loss)/earnings per share from continuing operations, operating
(loss)/profit and operating costs, the most directly comparable GAAP items,
are set out in the tables below.
 
Reconciliation of diluted earnings per share from continuing operations
excluding severance and special items
                         
                            Second Quarter
                            2012                    2011               %
                                                                       Change
Diluted
(loss)/earnings per
share from                  $   (0.57   )           $   0.05           *
continuing
operations
Add:
Severance                   0.01                    —
Special items:
Write-down of               0.85                    0.04
assets
Gain on sale of             (0.15       )           —
investment
Pension withdrawal          —                       0.02                
expense
Diluted earnings
per share from
continuing                  $   0.14                $   0.11           27.3%
operations
excluding severance
and special items
                                                                        
* Represents a decrease in excess of 100%.
 

 
THE NEW YORK TIMES COMPANY
RECONCILIATION OF NON-GAAP INFORMATION (continued)
(Dollars in thousands)
 
Reconciliation of operating profit/(loss) before depreciation & amortization,
severance and special items
                  
                   Second Quarter 2012
                   News Media     About Group      Corporate      Total
                   Group                                          Company
Operating          $ 52,211       $ (186,827 )     $ (9,008 )     $ (143,624 )
profit/(loss)
Add:
Depreciation &     22,920         2,263            —              25,183
amortization
Severance          1,828          —                16             1,844
Special item:
Write-down of      —              194,732          —              194,732     
assets
Operating
profit/(loss)
before
depreciation &     $ 76,959       $ 10,168         $ (8,992 )     $ 78,135    
amortization,
severance and
a special item
                                                                   
                   Second Quarter 2011
                   News Media     About Group      Corporate      Total
                   Group                                          Company
Operating          $ 29,422       $ 11,475         $ (9,405 )     $ 31,492
profit/(loss)
Add:
Depreciation &     23,894         2,706            —              26,600
amortization
Severance          1,375          421              52             1,848
Special items:
Write-down of      9,225          —                —              9,225
assets
Pension
withdrawal         4,228          —                —              4,228       
expense
Operating
profit/(loss)
before
depreciation &     $ 68,144       $ 14,602         $ (9,353 )     $ 73,393    
amortization,
severance and
special items
                                                                   
                   % Change
                   News Media     About Group      Corporate      Total
                   Group                                          Company
Operating          77.5%          *                -4.2%          *
profit/(loss)
Add:
Depreciation &     -4.1%          -16.4%           N/A            -5.3%
amortization
Severance          32.9%          N/A              -69.2%         -0.2%
Special items:
Write-down of      N/A            N/A              N/A            *
assets
Pension
withdrawal         N/A            N/A              N/A            N/A
expense
Operating
profit/(loss)
before
depreciation &     12.9%          -30.4%           -3.9%          6.5%
amortization,
severance and
special items
                                                                   
* Represents an increase or decrease in excess of 100%.
                                                                   

 
THE NEW YORK TIMES COMPANY
RECONCILIATION OF NON-GAAP INFORMATION (continued)
(Dollars in thousands)
 
Reconciliation of operating profit/(loss) before depreciation & amortization,
severance and special items
                 
                  Six Months 2012
                  News Media      About Group      Corporate       Total
                  Group                                            Company
Operating         $ 75,285        $ (179,831 )     $ (19,462 )     $ (124,008 )
profit/(loss)
Add:
Depreciation
&                 53,036          4,437            —               57,473
amortization
Severance         4,681           —                2,439           7,120
Special item:
Write-down of     —               194,732          —               194,732     
assets
Operating
profit/(loss)
before
depreciation
&                 $ 133,002       $ 19,338         $ (17,023 )     $ 135,317   
amortization,
severance and
a special
item
                                                                    
                  Six Months 2011
                  News Media      About Group      Corporate       Total
                  Group                                            Company
Operating         $ 55,298        $ 25,622         $ (23,509 )     $ 57,411
profit/(loss)
Add:
Depreciation
&                 46,817          5,456            —               52,273
amortization
Severance         2,048           444              52              2,544
Special
items:
Write-down of     9,225           —                —               9,225
assets
Pension
withdrawal        4,228           —                —               4,228       
expense
Operating
profit/(loss)
before
depreciation      $ 117,616       $ 31,522         $ (23,457 )     $ 125,681   
&
amortization,
severance and
special items
                                                                    
                  % Change
                  News Media      About Group      Corporate       Total
                  Group                                            Company
Operating         36.1%           *                -17.2%          *
profit/(loss)
Add:
Depreciation
&                 13.3%           -18.7%           N/A             9.9%
amortization
Severance         *               N/A              *               *
Special
items:
Write-down of     N/A             N/A              N/A             *
assets
Pension
withdrawal        N/A             N/A              N/A             N/A
expense
Operating
profit/(loss)
before
depreciation      13.1%           -38.7%           -27.4%          7.7%
&
amortization,
severance and
special items
                                                                    
* Represents an increase or decrease in excess of 100%.
 

 
THE NEW YORK TIMES COMPANY
RECONCILIATION OF NON-GAAP INFORMATION (continued)
(Dollars in thousands)
                                                                     
Reconciliation of total Company operating costs before depreciation &
amortization, severance and raw materials
                                       
                                      Second Quarter
Total Company                         2012            2011            % Change
Operating costs                       $ 464,104       $ 467,043       -0.6%
Less:
Depreciation & amortization           25,183          26,600
Severance                             1,844           1,848            
Operating costs before
depreciation & amortization and       437,077         438,595         -0.3%
severance
Less:
Raw materials                         33,596          34,222           
Operating costs before
depreciation & amortization,          $ 403,481       $ 404,373       -0.2%
severance and raw materials
                                                                       
Reconciliation of News Media Group operating costs before depreciation &
amortization and severance
                                       
                                      Second Quarter
News Media Group                      2012            2011            % Change
Operating costs                       $ 437,591       $ 441,269       -0.8%
Less:
Depreciation & amortization           22,920          23,894
Severance                             1,828           1,375            
Operating costs before
depreciation & amortization and       $ 412,843       $ 416,000       -0.8%
severance
                                                                       
Reconciliation of About Group operating costs before depreciation &
amortization and severance
                                       
                                      Second Quarter
About Group                           2012            2011            % Change
Operating costs                       $ 17,505        $ 16,369        6.9   %
Less:
Depreciation & amortization           2,263           2,706
Severance                             —               421              
Operating costs before
depreciation & amortization and       $ 15,242        $ 13,242        15.1  %
severance

Contact:

The New York Times Company
Media:
Abbe Serphos, 212-556-4425
serphos@nytimes.com
or
Investors:
Paula Schwartz, 212-556-5224
paula.schwartz@nytimes.com
Andrea Passalacqua, 212-556-7354
andrea.passalacqua@nytimes.com
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