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Media General Reports Third-Quarter 2012 Results

               Media General Reports Third-Quarter 2012 Results

PR Newswire

RICHMOND, Va., Oct. 17, 2012

RICHMOND, Va., Oct. 17, 2012 /PRNewswire/ --Media General, Inc. (NYSE: MEG),
a broadcast television and digital media company, today reported operating
income for the third quarter of 2012 of $22.5 million, compared with $4.8
million in the 2011 third quarter. The current quarter included corporate
severance expense of $3.3 million, the absence of $1.9 million in expense
savings last year from a company-wide furlough program and higher sales costs
related to significantly increased revenues this year. Net loss in the third
quarter was $30.3 million, or $1.34 per share, including $17.3 million of debt
extinguishment costs and a loss of $11.9 million related to discontinued
operations. Net loss in the 2011 third quarter was $29.8 million, or $1.32 per
share, including a newspaper impairment writedown reflected in discontinued
operations.

Marshall N. Morton, president and chief executive officer of Media General,
said, "Operating income was more than four times last year, mostly driven by a
nearly 42% increase in revenues. Political revenues totaled nearly $20 million
and reflected the strong positions of our television stations in their markets
and the presence of six Media General stations in presidential battleground
states. Our eight NBC stations generated a record $15.5 million of revenues
from the Summer Olympics, capitalizing on record viewership for the London
games. Gross time sales, excluding Political revenues, increased 16.8% in the
third quarter, reflecting growth in several major advertising categories and
the strength of the Olympics advertising."

Broadcast cash flow more than doubled to $40.8 million in the 2012 third
quarter, compared with $19.3 million last year. Broadcast cash flow margin in
the current quarter was 43.5%, compared with 29.1% last year.

Total revenues in the third quarter increased approximately $28 million to
$93.8 million this year, compared with $66.1 million last year. Local gross
time sales increased nearly 16% to $47.4 million. National gross time sales
grew 19.2% to nearly $25 million. The largest advertising category,
automotive, increased 45% due, in part, to comparisons against last year's
weak spending following Japan's tsunami and to the strength of Olympic
advertising this year. Other key categories growing in the quarter were
financial, grocery, travel, telecommunications and medical. Categories that
declined included restaurants and department stores.

Cable and satellite retransmission fees rose nearly 80% to $9.4 million in the
quarter, as a result of contract renewals that reflected competitive market
rates.

TV station websites generated $2.6 million in advertising revenues, up 20.7%
from last year, driven primarily by Local advertising, which grew 28%. Total
digital audience growth continued, including robust activity from mobile
devices. Unique visitors and page views from mobile devices each increased by
68% in the third quarter, while unique visitors from desktops grew 13%.

Station operating costs increased 12.1% in the current quarter, mostly due to
higher sales commissions related to increased revenues and the absence of $1.2
million in expense savings from last year's furlough program. Corporate
expense this year was $6.4 million, compared with $7 million last year. The
decrease in the current year is primarily due to a corporate staffing
reduction that was effectuated progressively through the quarter, offset by
the absence of last year's furlough savings.

Total interest expense in the third quarter was $20.2 million, of which $2.4
million was non-cash, compared with $16 million last year.

Noncash tax expense was $3.4 million in the third quarter, compared with
$847,000 in the prior year. Both periods reflected noncash tax expense related
to the company's "naked credit" issue, as previously discussed in the
company's 2011 Form 10-K.

EBITDA from continuing operations (income before interest, debt modification
and extinguishment costs, taxes, and depreciation and amortization) was $28.5
million, compared with  $12.1 million  in the 2011 period.

Media General provides the non-GAAP financial metrics: Broadcast cash flow,
EBITDA from continuing operations, After-tax cash flow from continuing
operations, and Free cash flow. The company believes these metrics are
alternative measures used by lenders, investors, financial analysts and rating
agencies to evaluate a company's ability to service its debt requirements and
to estimate the value of the company. A reconciliation of these metrics to
amounts on the GAAP statements has been included in this news release.

Guidance

Media General provided the following guidance:

For the fourth quarter, the company expects total revenues to increase 25-28%
over last year.

For the full year 2012, the company expects that cash provided by operations
will be used to make interest payments of $65 million, capital expenditures of
$15 million and retirement plan contributions of $9 million. The pension
contribution is down from our previous guidance of $13 million, due to the
relief provided by this year by Congress.

Forward-Looking Statements

This news release contains forward-looking statements that are subject to
various risks and uncertainties and should be understood in the context of the
company's publicly available reports filed with the Securities and Exchange
Commission. Media General's future performance could differ materially from
its current expectations.

Conference Call, Webcast and Financial Statements

The company will hold a conference call with financial analysts today at 11
a.m. ET. To dial in to the call, listeners may call 1-866-788-0539 about 10
minutes prior to the 11 a.m. start. The participant passcode is "Media
General."

Listeners may also access a live webcast by logging on to www.mediageneral.com
and clicking on the "Live Webcast" link on the homepage about 10 minutes in
advance. A replay of the webcast will be available online at
www.mediageneral.com beginning at 1 p.m. today. A telephone replay is also
available, beginning at 1 p.m. today, and ending at 11:59 p.m. on October 25,
2012, by dialing 1-888-286-8010 or 617-801-6888, and using the passcode
57846918.

About Media General

Media General is a leading provider of news, information and entertainment
across 18 network-affiliated broadcast television stations and their
associated digital media and mobile platforms. The company's stations serve
consumers and advertisers in strong local markets, primarily in the Southeast.
Media General's network affiliates include eight NBC stations, eight CBS
stations, one ABC station and one CW station. Six of the company's stations
operate in the Top 40 markets in the United States. Media General's stations
reach more than one-third of TV households in the Southeast and more than 8
percent of U.S. TV households. Media General entered the television business
in 1955 when it launched WFLA-TV in Tampa, Florida, as an NBC affiliate.
Today, WFLA is the company's largest TV station, operating in the 14th largest
DMA in the United States.

Contact Media General

Additional information about Media General is available on its web site
www.mediageneral.com or by contacting Lou Anne J. Nabhan, Vice
President-Corporate Communications, at (804) 649-6103 or
lnabhan@mediageneral.com.



Media General, Inc.
CONSOLIDATED STATEMENTS
OF OPERATIONS
                           Thirteen Weeks Ending        Thirty-Nine Weeks
                                                        Ending
                           September      September     September   September
                           23,            25,           23,         25,
(Unaudited, in thousands
except per share           2012           2011          2012        2011
amounts)
Station revenue (less      $         $        $       $    
agency commissions)        93,752         66,076        251,064     202,730
Operating costs:
   Station production      31,458         27,726        92,359      86,103
   expenses
   Station selling,
   general, and            21,505         19,497        63,473      60,854
   administrative
   expenses
   Corporate and other     12,093         7,082         31,604      24,070
   expenses
   Depreciation and        5,533          5,811         17,124      17,399
   software amortization
   Amortization of         442            1,314         2,196       3,940
   intangible assets
   (Gain) loss on
   disposal of assets,     218            (137)         (32)        236
   net
         Total operating   71,249         61,293        206,724     192,602
         costs
Operating income           22,503         4,783         44,340      10,128
Other income (expense):
   Interest expense        (20,220)       (16,034)      (57,028)    (49,787)
   Debt modification and   (17,318)       ---           (35,415)    ---
   extinguishment costs
   Other, net              40             219           452         688
         Total other       (37,498)       (15,815)      (91,991)    (49,099)
         expense
Loss from continuing
operations before income   (14,995)       (11,032)      (47,651)    (38,971)
taxes
Income tax expense         3,406          847           10,223      6,001
Loss from continuing       (18,401)       (11,879)      (57,874)    (44,972)
operations
Discontinued operations:
   Loss from
   discontinued            (1,038)        (17,953)      (10,588)    (26,046)
   operations (net of
   tax)
   Loss related to
   divestiture of
   discontinued            (10,894)       ---           (142,591)   ---
   operations (net of
   tax)
Net loss                   $          $         $        $    
                           (30,333)       (29,832)      (211,053)   (71,018)
Net loss per common
share - assuming
dilution:
   Loss from continuing    $         $        $       $    
   operations               (0.81)        (0.53)        (2.56)    (2.00)
   Discontinued            (0.53)         (0.79)        (6.79)      (1.16)
   operations
Net loss per common        $         $        $       $    
share - basic and           (1.34)        (1.32)        (9.35)    (3.16)
diluted
Weighted-average common
shares outstanding:
   Basic and diluted ^1    22,593         22,517        22,570      22,469
   Subsequent to the end of the third quarter, Berkshire Hathaway exercised
   warrants to purchase 4,646,220 shares of the Company's Class A common
^1 stock. Consequently, these shares were not included in the determination
   of basic weighted-average shares for the three-months and nine-months ended
   September 23, 2012.



Media General, Inc.
CONSOLIDATED BALANCE SHEETS
                                          September 23,      December 25,
(Unaudited, in thousands)                 2012               2011
ASSETS
Current assets:
    Cash and cash equivalents             $      28,450 $     23,108
    Accounts receivable - net             61,595             58,587
    Other                                 26,125             17,424
    Assets of discontinued operations     10,552             333,329
         Total current assets            126,722            432,448
Other assets                              37,955             28,277
Property, plant and equipment - net       161,445            175,276
Goodwill and other intangibles - net     447,844            450,040
Total assets                              $     773,966  $   1,086,041
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
Current liabilities:
    Accounts payable                      $      14,753 $     16,527
    Accrued expenses and other            66,965             46,472
    liabilities
    Liabilities of discontinued           9,535              38,716
    operations
         Total current liabilities       91,253             101,715
Long-term debt                            551,337            658,199
Deferred income taxes                     56,241             45,954
Other liabilities and deferred credits    235,046            246,220
Stockholders' equity (deficit)            (159,911)          33,953
Total liabilities and stockholders'       $     773,966  $   1,086,041
equity (deficit)



SUPPLEMENTAL INFORMATION
Media General, Inc.
Selected Revenue Categories
                     Thirteen Weeks Ending         Thirty-Nine Weeks Ending
                     September  September         September September
                     23,         25,              23,        25,
(Unaudited, in       2012        2011      %       2012       2011      %
thousands)                                 Change                       Change
Local (gross)        $      $     15.6 %  $      $     6.3 %
                     47,370      40,992         136,690   128,540
National (gross)     24,872      20,858    19.2 %  69,309     63,786    8.7 %
Political            19,568      1,328     ---     33,224     2,107     ---
Cable/Satellite
(retransmission)     9,355       5,268     77.6 %  27,718     15,971    73.6 %
fees
Digital (local       2,649       2,195     20.7 %  7,178      6,071     18.2 %
website revenues)
Broadcast Cash Flow
                     Thirteen Weeks Ending         Thirty-Nine Weeks
                                                   Ending
                     September  September         September September
                     23,         25,              23,        25,
(Unaudited, in       2012        2011              2012       2011
thousands)
Operating income     22,503      4,783             44,340     10,128
Add:
 Corporate and      12,093      7,082             31,604     24,070
other expenses
 Depreciation and
software             5,533       5,811             17,124     17,399
amortization
 Amortization of    442         1,314             2,196      3,940
intangible assets
 (Gain) loss on
disposal of assets,  218         (137)             (32)       236
net
 Amortization of
broadcast film       2,616       4,360             7,754      13,732
rights
Less:
 Payments for
broadcast film       2,610       3,961             7,654      13,404
rights
Broadcast cash flow  40,795      19,252            95,332     56,101



SUPPLEMENTAL INFORMATION
Media General, Inc.
EBITDA, After-tax Cash
Flow, and Free Cash
Flow
                          Thirteen Weeks Ending       Thirty-Nine Weeks Ending
                          September 23, September    September    September
                                         25,          23,         25,
(Unaudited, in            2012           2011         2012         2011
thousands)
Loss from continuing      $         $        $       $    
operations                (18,401)       (11,879)    (57,874)     (44,972)
Interest                  20,220         16,034       57,028       49,787
Debt modification and     17,318         -            35,415       -
extinguishment costs
Depreciation and          5,533          5,811        17,124       17,399
software amortization
Amortization of           442            1,314        2,196        3,940
intangible assets
Taxes                     3,406          847          10,223       6,001
EBITDA from continuing    $         $       $       $     
operations                28,518        12,127       64,112      32,155
Loss from continuing      $         $        $       $    
operations                (18,401)       (11,879)    (57,874)     (44,972)
Taxes *                   3,406          847          10,223       6,001
Depreciation and          5,533          5,811        17,124       17,399
software amortization
Amortization of           442            1,314        2,196        3,940
intangible assets
After-tax cash flow from  $        $       $       $    
continuing operations     (9,020)        (3,907)     (28,331)     (17,632)
After-tax cash flow from  $        $       $       $    
continuing operations     (9,020)        (3,907)     (28,331)     (17,632)
Capital expenditures      3,010          5,102        7,263        15,681
Free cash flow           $         $       $       $    
                          (12,030)       (9,009)     (35,594)     (33,313)
*     The Company's income taxes are non-cash in nature and have been added
      back accordingly.
                See 2011 Form 10-K for further discussion.
Corporate and other
expenses
                          Thirteen Weeks Ending       Thirty-Nine Weeks Ending
                          September 23, September    September    September
                                         25,          23,         25,
(Unaudited, in            2012           2011         2012         2011
thousands)
Corporate (excluding      $        $       $       $     
depreciation and           6,363         6,951      22,099      22,894
amortization)
Corporate severance      3,319          -            3,445        78
Incentive compensation    1,505          (427)        4,349        (165)
(including stations)
Other operating expenses  906            558          1,711        1,263
Corporate and other       $         $       $       $     
expenses                  12,093         7,082      31,604      24,070



SOURCE Media General, Inc.

Website: http://www.mediageneral.com
 
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