The Washington Post Company Reports Third Quarter Earnings

  The Washington Post Company Reports Third Quarter Earnings

Business Wire

WASHINGTON -- November 02, 2012

The Washington Post Company (NYSE: WPO) today reported net income attributable
to common shares of $93.8 million ($12.64 per share) for the third quarter
ended September 30, 2012, compared to a net loss attributable to common shares
of $6.2 million ($0.82 loss per share) for the third quarter of last year.
However, net income includes $49.1 million ($6.61 per share) in income from
discontinued operations and $18.8 million ($2.41 per share) in losses from
discontinued operations for the third quarter of 2012 and 2011, respectively
(refer to “Discontinued Operations” discussion below). Income from continuing
operations attributable to common shares was $44.7 million ($6.03 per share)
for the third quarter of 2012, compared to $12.6 million ($1.59 per share) for
the third quarter of 2011.

Items included in the Company’s income from continuing operations for the
third quarter of 2012:

  *$12.2 million in early retirement, severance and restructuring charges at
    the newspaper publishing division and Kaplan (after-tax impact of $7.6
    million, or $1.02 per share); and
  *$3.1 million in non-operating unrealized foreign currency gains (after-tax
    impact of $1.9 million, or $0.26 per share).

Items included in the Company’s income from continuing operations for the
third quarter of 2011:

  *$5.6 million in severance and restructuring charges at Kaplan (after-tax
    impact of $3.5 million, or $0.44 per share);
  *a $9.2 million impairment charge at one of the Company’s affiliates
    (after-tax impact of $5.7 million, or $0.72 per share);
  *a $23.1 million write-down of a marketable equity security (after-tax
    impact of $14.9 million, or $1.89 per share); and
  *$6.7 million in non-operating unrealized foreign currency losses
    (after-tax impact of $4.2 million, or $0.54 per share).

Excluding these items, income from continuing operations attributable to
common shares was $50.4 million ($6.79 per share) for the third  quarter of
2012, compared to $40.9 million ($5.18 per share) for the third quarter of
2011. (Non-GAAP measures are discussed below.)

Revenue for the third quarter of 2012 was $1,011.3 million, flat compared to
$1,012.5 million in the third quarter of 2011. The Company reported operating
income of $75.9 million in the third quarter of 2012, compared to operating
income of $70.2 million in the third quarter of 2011. Revenues and operating
income increased at the television broadcasting and cable television
divisions, offset by declines at the education and newspaper publishing
divisions.

For the first nine months of 2012, the Company reported net income
attributable to common shares of $176.7 million ($23.39 per share), compared
to $54.5 million ($6.81 per share) for the same period of 2011. However, net
income includes $83.2 million ($11.01 per share) in income from discontinued
operations and $28.8 million ($3.63 per share) in losses from discontinued
operations for the first nine months of 2012 and 2011, respectively (refer to
“Discontinued Operations” discussion below). Income from continuing operations
attributable to common shares was $93.5 million ($12.38 per share) for the
first nine months of 2012, compared to $83.3 million ($10.44 per share) for
the first nine months of 2011. As a result of the Company’s share repurchases,
there were 6% fewer diluted average shares outstanding in the first nine
months of 2012.

Items included in the Company’s income from continuing operations for the
first nine months of 2012:

  *$22.4 million in early retirement, severance and restructuring charges at
    the newspaper publishing division and Kaplan (after-tax impact of $13.9
    million, or $1.85 per share);
  *a $5.8 million gain on sales of cost method investments (after-tax impact
    of $3.7 million, or $0.48 per share); and
  *$3.2 million in non-operating unrealized foreign currency gains (after-tax
    impact of $2.0 million, or $0.27 per share).

Items included in the Company’s income from continuing operations for the
first nine months of 2011:

  *$19.6 million in severance and restructuring charges at Kaplan (after-tax
    impact of $12.2 million, or $1.52 per share);
  *a $9.2 million impairment charge at one of the Company’s affiliates
    (after-tax impact of $5.7 million, or $0.72 per share);
  *a $53.8 million write-down of a marketable equity security (after-tax
    impact of $34.6 million, or $4.34 per share); and
  *$3.7 million in non-operating unrealized foreign currency losses
    (after-tax impact of $2.3 million, or $0.29 per share).

Excluding these items, income from continuing operations attributable to
common shares was $101.7 million ($13.48 per share) for the first nine months
of 2012, compared to $138.1 million ($17.31 per share) for the first nine
months of 2011. (Non-GAAP measures are discussed below.)

Revenue for the first nine months of 2012 was $2,967.6 million, down 4% from
$3,090.7 million in the first nine months of 2011. Revenues were down at the
education and newspaper publishing divisions, partially offset by increases at
the television broadcasting and cable television divisions. The Company
reported operating income of $159.0 million for the first nine months of 2012,
compared to $216.6 million for the first nine months of 2011. Operating
results were down at all of the Company’s divisions, except for the television
broadcasting division.

Division Results

Education

Education division revenue totaled $552.6 million for the third quarter of
2012, an 8% decline from revenue of $601.6 million for the third quarter of
2011. Excluding revenue from acquired businesses, education division revenue
declined 9% in the third quarter of 2012. Kaplan reported third quarter 2012
operating income of $14.7 million, down from $20.8 million in the third
quarter of 2011.

For the first nine months of 2012, education division revenue totaled $1,652.1
million, a 9% decline from revenue of $1,823.7 million for the same period of
2011. Excluding revenue from acquired businesses, education division revenue
declined 11% for the first nine months of 2012. Kaplan reported operating
income of $6.5 million for the first nine months of 2012, compared to
operating income of $65.4 million for the first nine months of 2011.

In light of recent revenue declines and other business challenges, Kaplan has
formulated and implemented restructuring plans at its various businesses that
have resulted in significant costs in 2012 and 2011, with the objective of
establishing lower costs levels in future periods. Across all businesses,
severance and restructuring costs totaled $4.3 million and $9.3 million in the
third quarter and first nine months of 2012, respectively, compared to $5.6
million and $19.6 million in the third quarter and first nine months of 2011,
respectively. Kaplan expects to incur significant additional restructuring
costs in the fourth quarter of 2012 and in 2013 at Kaplan Higher Education and
Kaplan International.

A summary of Kaplan’s operating results for the third quarter and the first
nine months of 2012 compared to 2011 is as follows:

                                                                                
                Three Months Ended                   Nine Months Ended
                September    October 2,             September 30,  October 2,
                30,
(in            2012         2011         %       2012           2011           %
thousands)                                  Change                                   Change
Revenue
Higher          $ 273,703     $ 330,856     (17  )   $ 872,948       $ 1,076,051     (19  )
education
Test              81,151        79,630      2          223,767         236,192       (5   )
preparation
Kaplan            197,858       192,609     3          555,899         513,760       8
international
Kaplan            998           1,293       (23  )     3,158           3,475         (9   )
corporate
Intersegment     (1,125  )   (2,777  )   ―         (3,705    )   (5,782    )   ―
elimination
                $ 552,585   $ 601,611    (8   )   $ 1,652,067   $ 1,823,696    (9   )
Operating
Income (Loss)
Higher          $ 1,510       $ 25,083      (94  )   $ 16,329        $ 120,890       (86  )
education
Test              3,446         (4,745  )   ―          (4,067    )     (29,018   )   86
preparation
Kaplan            20,619        10,775      91         33,336          18,735        78
international
Kaplan            (6,617  )     (3,657  )   (81  )     (28,143   )     (28,898   )   3
corporate
Amortization
of intangible     (4,489  )     (5,568  )   19         (11,528   )     (15,023   )   23
assets
Intersegment     224        (1,080  )   ―         579          (1,293    )   ―
elimination
                $ 14,693    $ 20,808     (29  )   $ 6,506       $ 65,393       (90  )
                                                                                          

Kaplan sold Kidum in August 2012, EduNeering in April 2012 and Kaplan Learning
Technologies in February 2012. Consequently, the education division’s
operating results exclude these businesses.

Kaplan Higher Education (KHE) includes Kaplan’s domestic postsecondary
education businesses, made up of fixed-facility colleges and online
postsecondary and career programs. KHE also includes the domestic professional
training and other continuing education businesses. In the third quarter and
first nine months of 2012, higher education revenue declined 17% and 19%,
respectively, due largely to declines in average enrollments that reflect
weaker market demand over the past year. Operating income decreased 94% and
86% for the third quarter and first nine months of 2012, respectively. These
declines were due primarily to lower revenue, offset by expense reductions
associated with lower enrollments and recent restructuring efforts.

In September 2012, KHE finalized a plan to consolidate its market presence at
certain of its fixed-facility campuses. Under this plan, KHE has ceased new
enrollments at nine ground campuses as it considers alternatives for these
locations, and is in the process of consolidating operations of four other
campuses into existing, nearby locations. KHE will be teaching out the current
students at these campuses. Revenues at these campuses represent approximately
4% of KHE’s total revenues. In connection with the plan, KHE expects to incur
an estimated $18 million in restructuring costs from fixed asset write-downs
and lease and severance obligations; $2.1 million of these restructuring costs
were recorded in the third quarter of 2012, with the remainder to be recorded
in the fourth quarter of 2012 and in 2013. In the third quarter and first nine
months of 2012, KHE incurred $2.7 million and $6.5 million in total severance
and restructuring costs, respectively, compared to $1.6 million and $7.1
million in the third quarter and first nine months 2011, respectively. KHE
continues to assess and develop plans for both its fixed-facility and online
programs and expects to incur significant additional restructuring costs in
the fourth quarter of 2012 and in 2013.

Although revenues were down substantially compared to the first nine months of
2011, new student enrollments at Kaplan University and KHE Campuses increased
5% in the first nine months of 2012. For the third quarter of 2012, new
student enrollments increased 9%. Total enrollments at September 30, 2012,
were down 8% compared to September 30, 2011, but increased 8% compared to June
30, 2012.

                    
                        Student Enrollments as of
                        September 30,  June 30,  September 30,
                    2012           2012      2011
Kaplan University       49,132          44,756     53,473
KHE Campuses            24,129         22,849    26,184
                        73,261         67,605    79,657
                                                   

Kaplan University enrollments included 6,822, 5,681 and 6,036 campus-based
students as of September 30, 2012, June 30, 2012, and September 30, 2011,
respectively.

Kaplan University and KHE Campuses enrollments at September 30, 2012, and
September 30, 2011, by degree and certificate programs, are as follows:

              
                  As of September 30,
              2012      2011
Certificate       23.6  %   23.5  %
Associate’s       30.7  %     31.0  %
Bachelor’s        32.7  %     34.7  %
Master’s          13.0  %   10.8  %
                  100.0 %   100.0 %
                                    

Kaplan Test Preparation (KTP) includes Kaplan’s standardized test preparation
and tutoring offerings. KTP revenue increased 2% in the third quarter of 2012,
while revenues declined 5% for the first nine months of 2012. Enrollment
increased 21% and 12% for the third quarter and first nine months of 2012,
respectively, driven by strength in pre-college, medical and bar review
programs. Enrollment increases were offset by competitive pricing pressure and
a continued shift in demand to lower priced online test preparation offerings.
The improvement in KTP operating results in the first nine months of 2012 is
largely from lower operating expenses due to restructuring activities in prior
years. Also, $3.5 million and $12.0 million in restructuring costs were
recorded in the third quarter and first nine months of 2011, respectively.

Kaplan International includes English-language programs, and postsecondary
education and professional training businesses outside the United States. In
May 2011, Kaplan Australia acquired Franklyn Scholar and Carrick Education
Group, national providers of vocational training and higher education in
Australia. In June 2011, Kaplan acquired Structuralia, a provider of
e-learning for the engineering and infrastructure sector in Spain. Kaplan
International revenue increased 3% and 8% in the third quarter and first nine
months of 2012, respectively. Excluding revenue from acquired businesses,
Kaplan International revenue increased 2% in both the third quarter and the
first nine months of 2012 due to enrollment growth in the English-language and
Singapore higher education programs. Kaplan International operating income
increased in the first nine months of 2012 due largely to strong results in
Singapore, offset by combined losses from businesses acquired in 2011. These
losses are primarily in Australia, where Kaplan is in the process of
consolidating operations and expects to incur restructuring costs in the
fourth quarter of 2012 and in 2013.

Corporate represents unallocated expenses of Kaplan, Inc.’s corporate office
and other minor shared activities.

Cable Television

Cable television division revenue increased 6% in the third quarter of 2012 to
$199.6 million, from $187.9 million for the third quarter of 2011; for the
first nine months of 2012, revenue increased 3% to $585.4 million, from $569.4
million in the same period of 2011. The revenue increase for the first nine
months of 2012 is due to continued growth of the division’s Internet and
telephone service revenues and rate increases for many subscribers in June
2012, offset by an increase in promotional discounts and a decline in basic
video subscribers.

Cable television division operating income increased 8% to $39.9 million, from
$36.8 million in the third quarter of 2011, due to increased revenues, offset
by higher programming costs. Cable division operating income for the first
nine months of 2012 decreased 3% to $111.1 million, from $114.9 million for
the first nine months of 2011, primarily due to higher programming costs.

At September 30, 2012, Primary Service Units (PSUs) were up slightly from the
prior year due to growth in high-speed data and telephony subscribers, offset
by a decrease in basic video subscribers. A summary of PSUs is as follows:

                  
                      As of September 30,
                  2012       2011
Basic video           605,057    627,659
High-speed data       462,808     448,143
Telephony             185,647    176,527
                      1,253,512  1,252,329
                                  

Newspaper Publishing

Newspaper publishing division revenue totaled $137.3 million for the third
quarter of 2012, down 4% from revenue of $143.5 million for the third quarter
of 2011; division revenue declined 7% to $419.6 million for the first nine
months of 2012, from $450.4 million for the first nine months of 2011. Print
advertising revenue at The Washington Post in the third quarter of 2012
declined 11% to $51.4 million, from $57.6 million in the third quarter of
2011, and declined 14% to $160.7 million for the first nine months of 2012,
from $187.4 million for the first nine months of 2011. The decline is largely
due to reductions in general and retail advertising. Revenue generated by the
Company’s newspaper online publishing activities, primarily washingtonpost.com
and Slate, increased 13% to $26.9 million for the third quarter of 2012,
versus $23.8 million for the third quarter of 2011; newspaper online revenues
increased 4% to $77.5 million for the first nine months of 2012, versus $74.3
million for the first nine months of 2011. Display online advertising revenue
increased 18% and 5% for the third quarter and first nine months of 2012,
respectively. Online classified advertising revenue increased 1% for the third
quarter and decreased 1% for the first nine months of 2012.

For the first nine months of 2012, Post daily and Sunday circulation declined
9.2% and 6.5%, respectively, compared to the same periods of the prior year.
For the nine months ended September 30, 2012, average daily circulation at The
Washington Post totaled 471,200 and average Sunday circulation totaled
689,000.

The newspaper publishing division reported an operating loss of $21.8 million
in the third quarter of 2012 and an operating loss of $10.8 million in the
third quarter of 2011, including noncash pension expense of $16.2 million and
$5.2 million, respectively. The newspaper publishing division reported an
operating loss of $56.3 million for the first nine months of 2012 and an
operating loss of $28.0 million for the first nine months of 2011, including
noncash pension expense of $32.6 million and $17.2 million, respectively.
Included in pension expense for the third quarter of 2012 was a $7.5 million
Voluntary Retirement Incentive Program (VRIP) for certain employees.

The decline in operating results for the third quarter of 2012 is due to the
revenue reductions discussed above and $7.8 million in early retirement and
severance expense, offset partially by a decline in other operating expenses.
The decline in operating results for the first nine months of 2012 is
primarily due to the revenue reductions discussed above and $13.1 million in
early retirement and severance expense, offset partially by a decline in other
operating expenses. Newsprint expense was down 9% and 10% for the third
quarter and first nine months of 2012, respectively, due to a decline in
newsprint consumption.

Television Broadcasting

Revenue for the television broadcasting division increased 44% to $106.4
million in the third quarter of 2012, from $73.8 million in the same period of
2011; operating income for the third quarter of 2012 more than doubled to
$54.1 million, from $24.1 million in the same period of 2011. For the first
nine months of 2012, revenue increased 23% to $283.5 million, from $231.0
million in the same period of 2011; operating income for the first nine months
of 2012 increased 69% to $128.8 million, from $76.2 million in the same period
of 2011.

The increase in revenue and operating income for the third quarter and first
nine months of 2012 reflects improved advertising demand across many product
categories. This includes a $15.6 million and $22.1 million increase in
political advertising revenue in the third quarter and first nine months of
2012, respectively; $10.8 million in incremental summer Olympics-related
advertising at the Company’s NBC affiliates in the third quarter of 2012; and
increased retransmission revenues.

Other Businesses

Other businesses includes the operating results of Social Code, an agency
specializing in paid advertising on social-media platforms, and WaPo Labs, a
digital team focused on emerging technologies and new product development.

In September 2012, The Washington Post Company entered into a stock purchase
agreement to acquire a controlling interest in Celtic Healthcare, Inc.
(Celtic), a provider of home healthcare and hospice services in the
northeastern and mid-Atlantic regions. The transaction is expected to close in
November 2012. The operating results of Celtic will be included in other
businesses.

Corporate Office

Corporate office includes the expenses of the Company’s corporate office as
well as a net pension credit.

Equity in Earnings (Losses) of Affiliates

The Company holds a 49% interest in Bowater Mersey Paper Company, a 16.5%
interest in Classified Ventures, LLC and interests in several other
affiliates.

The Company’s equity in earnings of affiliates, net, was $4.1 million for the
third quarter of 2012, compared to a loss of $1.5 million for the third
quarter of 2011. For the first nine months of 2012, the Company’s equity in
earnings of affiliates, net, totaled $11.3 million, compared to $5.4 million
for the same period of 2011. In the third quarter of 2011, a $9.2 million
impairment charge was recorded on the Company’s interest in Bowater Mersey
Paper Company.

Other Non-Operating Income (Expense)

The Company recorded other non-operating income, net, of $4.2 million for the
third quarter of 2012, compared to other non-operating expense, net, of $29.7
million for the third quarter of 2011. The third quarter 2012 non-operating
expense, net, included $3.1 million in unrealized foreign currency gains and
other items. The third quarter 2011 non-operating expense, net, included a
$23.1 million write-down of a marketable equity security (Corinthian Colleges,
Inc.), $6.7 million in unrealized foreign currency losses and other items.

The Company recorded non-operating income, net, of $12.1 million for the first
nine months of 2012, compared to other non-operating expense, net, of $56.3
million for the same period of the prior year. The 2012 non-operating income,
net, included a $7.3 million gain on sales of cost method investments, $3.2
million in unrealized foreign currency gains and other items. The 2011
non-operating expense, net, included a $53.8 million write-down of a
marketable equity security (Corinthian Colleges, Inc.), $3.7 million in
unrealized foreign currency losses and other items.

Net Interest Expense

The Company incurred net interest expense of $8.1 million and $24.4 million
for the third quarter and first nine months of 2012, respectively, compared to
$7.7 million and $21.6 million for the same periods of 2011. At September 30,
2012, the Company had $456.5 million in borrowings outstanding, at an average
interest rate of 7.0%.

Provision for Income Taxes

The effective tax rate for income from continuing operations for the first
nine months of 2012 was 40.3%, compared to 41.6% for the first nine months of
2011.

Discontinued Operations

Kaplan sold Kidum in August 2012, EduNeering in April 2012 and Kaplan Learning
Technologies in February 2012. The Company also divested its interest in
Avenue100 Media Solutions on July 31, 2012. Consequently, the Company’s income
from continuing operations excludes these businesses, which have been
reclassified to discontinued operations, net of tax.

The sale of Kaplan Learning Technologies resulted in a pre-tax loss of $3.1
million, which was recorded in the first quarter of 2012. The sale of
EduNeering resulted in a pre-tax gain of $29.5 million, which was recorded in
the second quarter of 2012. The sale of Kidum resulted in a pre-tax gain of
$3.6 million, which was recorded in the third quarter of 2012.

In connection with each of the sales of the Company’s stock in EduNeering and
Kaplan Learning Technologies, in the first quarter of 2012, the Company
recorded $23.2 million of income tax benefits related to the excess of the
outside stock tax basis over the net book value of the net assets disposed.

In connection with the disposal of Avenue100 Media Solutions, Inc., the
Company recorded a pre-tax loss of $5.7 million in the third quarter of 2012.
An income tax benefit of $44.5 million was also recorded in the third quarter
of 2012 as the Company determined that Avenue100 Media Solutions, Inc. had no
value. The income tax benefit is due to the Company’s tax basis in the stock
of Avenue100 exceeding its net book value, as a result of goodwill and other
intangible asset impairment charges recorded in 2008, 2010 and 2011 for which
no tax benefit was previously recorded.

Earnings (Loss) Per Share

The calculation of diluted earnings per share for the third quarter and first
nine months of 2012 was based on 7,376,255 and 7,507,946 weighted average
shares outstanding, respectively, compared to 7,882,709 and 7,978,520,
respectively, for the third quarter and first nine months of 2011. In the
first nine months of 2012, the Company repurchased 284,550 shares of its Class
B common stock at a cost of $97.5 million. At September 30, 2012, there were
7,378,237 shares outstanding and the Company had remaining authorization from
the Board of Directors to purchase up to 208,924 shares of Class B common
stock.

Forward-Looking Statements

This report contains certain forward-looking statements that are based largely
on the Company’s current expectations. Forward-looking statements are subject
to certain risks and uncertainties that could cause actual results and
achievements to differ materially from those expressed in the forward-looking
statements. For more information about these forward-looking statements and
related risks, please refer to the section titled “Forward-Looking Statements”
in Part I of the Company’s Annual Report on Form 10-K.

                                                                             
THE WASHINGTON POST COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
                                                                 
                                    Three Months Ended
                                    September 30,   October 2,        %
(in thousands, except per share    2012           2011            Change 
amounts)
Operating revenues                  $ 1,011,334     $ 1,012,498       0
Operating expenses                    (866,583  )     (874,350  )     (1     )
Depreciation of property, plant       (63,739   )     (61,589   )     3
and equipment
Amortization of intangible assets    (5,091    )   (6,320    )     (19    )
Operating income                      75,921          70,239          8
Equity in earnings (losses) of        4,099           (1,494    )     ―
affiliates, net
Interest income                       648             994             (35    )
Interest expense                      (8,738    )     (8,667    )     1
Other income (expense), net          4,163        (29,650   )     ―
Income from continuing operations     76,093          31,422          ―
before income taxes
Provision for income taxes           31,200       18,600         68
Income from continuing operations     44,893          12,822          ―
Income (loss) from discontinued      49,054       (18,788   )     ―
operations, net of tax
Net income (loss)                     93,947          (5,966    )     ―
Net loss (income) attributable to    71           (16       )     ―
noncontrolling interests
Net income (loss) attributable to     94,018          (5,982    )     ―
The Washington Post Company
Redeemable preferred stock           (222      )   (226      )     (2     )
dividends
Net Income (Loss) Attributable to
The Washington Post Company         $ 93,796      $ (6,208    )     ―
Common Stockholders
                                                                             
Amounts Attributable to The
Washington Post Company Common
Stockholders
Income from continuing operations   $ 44,742        $ 12,580          ―
Income (loss) from discontinued      49,054       (18,788   )     ―
operations, net of tax
Net income (loss)                   $ 93,796      $ (6,208    )     ―
                                                                             
Per Share Information
Attributable to The Washington
Post Company Common Stockholders
Basic income per common share       $ 6.03          $ 1.59            ―
from continuing operations
Basic income (loss) per common
share from discontinued              6.61         (2.41     )     ―
operations
Basic net income (loss) per         $ 12.64       $ (0.82     )     ―
common share
Basic average number of common       7,272        7,802     
shares outstanding
                                                                             
Diluted income per common share     $ 6.03          $ 1.59            ―
from continuing operations
Diluted income (loss) per common
share from discontinued              6.61         (2.41     )     ―
operations
Diluted net income (loss) per       $ 12.64       $ (0.82     )     ―
common share
Diluted average number of common     7,376        7,883     
shares outstanding

                                                                     
THE WASHINGTON POST COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
                                                  
                                    Nine Months Ended
                                    September 30,    October 2,         %
(In thousands, except per share    2012            2011             Change
amounts)
Operating revenues                  $ 2,967,557      $ 3,090,724        (4   )
Operating expenses                    (2,606,446 )     (2,670,703 )     (2   )
Depreciation of property, plant       (188,763   )     (186,133   )     1
and equipment
Amortization of intangible assets    (13,392    )   (17,293    )     (23  )
Operating income                      158,956          216,595          (27  )
Equity in earnings of affiliates,     11,301           5,381            ―
net
Interest income                       2,492            2,973            (16  )
Interest expense                      (26,880    )     (24,588    )     9
Other income (expense), net          12,116        (56,273    )     ―
Income from continuing operations     157,985          144,088          10
before income taxes
Provision for income taxes           63,600        59,900          6
Income from continuing operations     94,385           84,188           12
Income (loss) from discontinued      83,177        (28,762    )     ―
operations, net of tax
Net income                            177,562          55,426           ―
Net (income) loss attributable to    (10        )   10              ―
noncontrolling interests
Net income attributable to The        177,552          55,436           ―
Washington Post Company
Redeemable preferred stock           (895       )   (917       )     (2   )
dividends
Net Income Attributable to The
Washington Post Company Common      $ 176,657      $ 54,519          ―
Stockholders
                                                                             
Amounts Attributable to The
Washington Post Company Common
Stockholders
Income from continuing operations   $ 93,480         $ 83,281           12
Income (loss) from discontinued      83,177        (28,762    )     ―
operations, net of tax
Net income                          $ 176,657      $ 54,519          ―
                                                                             
Per Share Information
Attributable to The Washington
Post Company Common Stockholders
Basic income per common share       $ 12.38          $ 10.44            19
from continuing operations
Basic income (loss) per common
share from discontinued              11.01         (3.63      )     ―
operations
Basic net income per common share   $ 23.39        $ 6.81            ―
Basic average number of common       7,405         7,900      
shares outstanding
                                                                             
Diluted income per common share     $ 12.38          $ 10.44            19
from continuing operations
Diluted income (loss) per common
share from discontinued              11.01         (3.63      )     ―
operations
Diluted net income per common       $ 23.39        $ 6.81            ―
share
Diluted average number of common     7,508         7,979      
shares outstanding

                                                                                              
THE WASHINGTON POST COMPANY
BUSINESS SEGMENT INFORMATION
(Unaudited)
                                                                                  
                Three Months Ended                       Nine Months Ended
                September 30,   October 2,      %        September 30,   October 2,      %
(in            2012           2011           Change  2012           2011           Change
thousands)
Operating
Revenues:
Education       $ 552,585       $ 601,611       (8   )   $ 1,652,067     $ 1,823,696     (9   )
Cable             199,625         187,892       6          585,414         569,403       3
television
Newspaper         137,276         143,495       (4   )     419,550         450,411       (7   )
publishing
Television        106,411         73,830        44         283,499         230,953       23
broadcasting
Other             15,834          5,764         ―          27,779          16,617        67
businesses
Corporate         ―               ―             ―          ―               ―             ―
office
Intersegment     (397      )   (94       )   ―         (752      )   (356      )   ―
elimination
                $ 1,011,334   $ 1,012,498    0        $ 2,967,557   $ 3,090,724    (4   )
Operating
Expenses:
Education       $ 537,892       $ 580,803       (7   )   $ 1,645,561     $ 1,758,303     (6   )
Cable             159,712         151,097       6          474,278         454,476       4
television
Newspaper         159,101         154,256       3          475,885         478,408       (1   )
publishing
Television        52,329          49,757        5          154,690         154,718       0
broadcasting
Other             21,082          7,509         ―          44,445          22,288        99
businesses
Corporate         5,694           (1,069    )   ―          14,494          6,292         ―
office
Intersegment     (397      )   (94       )   ―         (752      )   (356      )   ―
elimination
                $ 935,413     $ 942,259      (1   )   $ 2,808,601   $ 2,874,129    (2   )
Operating
Income
(Loss):
Education       $ 14,693        $ 20,808        (29  )   $ 6,506         $ 65,393        (90  )
Cable             39,913          36,795        8          111,136         114,927       (3   )
television
Newspaper         (21,825   )     (10,761   )   ―          (56,335   )     (27,997   )   ―
publishing
Television        54,082          24,073        ―          128,809         76,235        69
broadcasting
Other             (5,248    )     (1,745    )   ―          (16,666   )     (5,671    )   ―
businesses
Corporate        (5,694    )   1,069        ―         (14,494   )   (6,292    )   ―
office
                $ 75,921      $ 70,239       8        $ 158,956     $ 216,595      (27  )
Depreciation:
Education       $ 22,024        $ 20,338        8        $ 63,752        $ 61,635        3
Cable             32,310          31,661        2          96,741          94,980        2
television
Newspaper         6,274           6,453         (3   )     18,792          19,893        (6   )
publishing
Television        3,126           3,137         0          9,473           9,381         1
broadcasting
Other             5               ―             ―          5               ―             ―
businesses
Corporate        ―             ―             ―         ―             244          ―
office
                $ 63,739      $ 61,589       3        $ 188,763     $ 186,133      1
Amortization
of Intangible
Assets:
Education       $ 4,489         $ 5,568         (19  )   $ 11,528        $ 15,023        (23  )
Cable             52              62            (16  )     159             201           (21  )
television
Newspaper         150             290           (48  )     505             869           (42  )
publishing
Television        ―               ―             ―          ―               ―             ―
broadcasting
Other             400             400           ―          1,200           1,200         ―
businesses
Corporate        ―             ―             ―         ―             ―             ―
office
                $ 5,091       $ 6,320        (19  )   $ 13,392      $ 17,293       (23  )
Pension
Expense
(Credit):
Education       $ 3,522         $ 1,655         ―        $ 7,883         $ 4,859         62
Cable             694             455           53         1,738           1,470         18
television
Newspaper         16,181          5,241         ―          32,554          17,226        89
publishing
Television        1,432           325           ―          3,447           1,306         ―
broadcasting
Other             18              4             ―          38              13            ―
businesses
Corporate        (9,021    )   (9,185    )   (2   )    (27,215   )   (27,729   )   (2   )
office
                $ 12,826      $ (1,505    )   ―        $ 18,445      $ (2,855    )   ―


NON-GAAP FINANCIAL INFORMATION
THE WASHINGTON POST COMPANY
(Unaudited)


In addition to the results reported in accordance with accounting principles
generally accepted in the United States (“GAAP”) included in this press
release, the Company has provided information regarding income from continuing
operations excluding certain items described below reconciled to the most
directly comparable GAAP measures. Management believes these non-GAAP
measures, when read in conjunction with the company‘s GAAP financials, provide
useful information to investors by offering:

  *the ability to make meaningful period-to-period comparisons of the
    Company’s ongoing results;
  *the ability to identify trends in the Company’s underlying business; and
  *a better understanding of how management plans and measures the Company’s
    underlying business.

Income from continuing operations excluding certain items should not be
considered a substitute or alternative to computations calculated in
accordance with and required by GAAP. These non-GAAP financial measures should
be read only in conjunction with financial information presented on a GAAP
basis.

The following table reconciles the non-GAAP financial measures to the most
directly comparable GAAP measures:

                                                 
                       Three Months Ended          Nine Months Ended
                       September 30,  October 2,   September 30,  October 2,
(in thousands,
except per share      2012           2011        2012           2011
amounts)
Amounts attributable
to The Washington
Post Company common
stockholders
Income from
continuing             $  44,742     $  12,580   $  93,480     $  83,281
operations, as
reported
Adjustments:
Severance and
restructuring             7,553           3,472        13,905          12,152
charges
Marketable equity
securities             ―                  14,875    ―                  34,643
write-down
Gain on sales of
cost method            ―               ―               (3,657   )   ―
investments
Foreign currency          (1,928  )       4,239        (1,997   )      2,323
(gain) loss
Investment in
affiliates             ―               5,703    ―               5,703
impairment charges
Income from
continuing             $  50,367     $  40,869   $  101,731    $  138,102
operations, adjusted
(non-GAAP)
                                                                    
Per share
information
attributable to The
Washington Post
Company common
stockholders
Diluted income per
common share from
continuing             $  6.03       $  1.59     $  12.38      $  10.44
operations, as
reported
Adjustments:
Severance and
restructuring             1.02            0.44         1.85            1.52
charges
Marketable equity
securities             ―                  1.89      ―                  4.34
write-down
Gain on sales of
cost method            ―               ―               (0.48    )   ―
investments
Foreign currency          (0.26   )       0.54         (0.27    )      0.29
(gain) loss
Investment in
affiliates             ―               0.72     ―               0.72
impairment charges
Diluted income per
common share from
continuing             $  6.79       $  5.18     $  13.48      $  17.31
operations, adjusted
(non-GAAP)
                                                                    
The adjusted diluted per share
amounts may not compute due to
rounding.

Contact:

The Washington Post Company
Hal S. Jones, 202-334-6645