September 24, 2001
Belo's monthly Revenue and Statistical Report August 2001
Dallas, TX-- Belo (NYSE: BLC) issued today its statistical report for the month of August.
Television Group revenues decreased 10.2 percent for the month of August on a pro forma basis. Television local revenues were flat while national revenues were down 12.4 percent; political revenues were $3.1 million less than August 2000. Newspaper Group total revenues were down 12.7 percent in August on a pro forma basis.
Company Updates Third Quarter Outlook Robert W. Decherd, Belo's chairman, president and chief executive officer, stated, "In response to the unspeakable tragedies visited upon our Nation on September 11, Belo's newspapers, television stations, cable news channels and Web sites focused all of their attention on providing the most timely, relevant news from both a local and national perspective to readers and viewers in our markets.
We experienced significant reductions in advertising revenues related to the continuous news coverage, but have now fully resumed normal operations. We are presently assessing advertising demand going forward.
"Like all exemplary news organizations, Belo incurred temporary increases in newsgathering costs. Accordingly, the Company's revenue and operating cash flow in the third quarter will be less than previously expected, resulting in a pretax loss. Because of Belo's high 2001 effective tax rate, the tax benefit in the third quarter exceeds the expected third quarter loss, and we therefore expect third quarter earnings per share to be in the range of 1 to 3 cents."
The Company's effective tax rate is currently expected to exceed 150 percent for 2001 because of lower pretax earnings resulting from this year's advertising downturn and the special charges Belo recorded in the second quarter of 2001, coupled with a fixed amount of goodwill amortization that is not deductible for tax purposes but is deducted in determining book income.
Implementation of the FASB's new goodwill standard in 2002 will eliminate most of this difference and result in an effective tax rate that more closely approximates Belo's combined federal and state income tax rate.
Belo will report its third quarter results on Wednesday, October 24 before the market opens.
August Newspaper Linage
At The Dallas Morning News, total full-run advertising linage, including preprints and supplements, was down 5.0 percent over last year. Retail was up 6.9 percent with increases in the grocery and drug store categories. General volume was down 28.7 percent primarily due to the loss of .com advertising and weakness in the telecom and travel categories. Classified volumes were down 12.7 percent with continued weakness in classified employment.
At The Providence Journal, total full-run advertising linage, including preprints and supplements, decreased 16.5 percent, while total full-run ROP was down 13.2 percent. Retail and classified volumes decreased 16.7 percent and 10.1 percent, respectively. General volume was down 29.1 percent.
Belo is one of the nation's largest media companies with a diversified group of market-leading broadcasting, publishing, cable and interactive media assets. A Fortune 1000 company with more than 8,000 employees and $1.5 billion in annual revenues, Belo operates news and information franchises in some of America's most dynamic markets and regions, including Texas, the Northwest, the Southwest, Rhode Island, and the Mid-Atlantic region. Belo owns 17 television stations (six in the top 16 markets) reaching 14 percent of U.S. television households; owns or operates six cable news channels; and manages three television stations through local marketing agreements. Belo publishes four daily newspapers: The Dallas Morning News, The Providence Journal, The Press-Enterprise (Riverside, CA.) and the Denton Record-Chronicle (Denton, TX.). Belo Interactive's new media businesses include 34 Web sites, several interactive alliances, and a broad range of Internet-based products. For more information, contact Carey Hendrickson, vice president of investor relations, at 214-977-6606. Additional information, including earnings releases, is available online at www.belo.com.
Statements in this communication concerning the Company's business outlook or future economic performance, anticipated profitability, revenues, expenses, capital expenditures or other financial items and other statements that are not historical facts, are "forward-looking statements" as the term is defined under applicable Federal Securities Laws. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those statements.
Such risks, uncertainties and factors include, but are not limited to, changes in advertising demand, interest rates and newsprint prices; technological changes; development of Internet commerce; industry cycles; changes in pricing or other actions by competitors and suppliers; regulatory changes; the effects of Company acquisitions and dispositions; and general economic conditions, as well as other risks detailed in the Company's filings with the Securities and Exchange Commission ("SEC"), including the Annual Report on Form 10-K.