February 8, 2002

Belo reports results for 2001 full year and fourth quarter

Dallas, TX-- Belo (NYSE: BLC) today reported that fourth quarter earnings per share before non recurring charges were breakeven, $0.03 better than analysts' consensus estimate.

Earnings per share before non-recurring charges were $0.27 in the fourth quarter of 2000. For full-year 2001, earnings per share before non-recurring charges were $0.19, compared with $0.82 in 2000. After-tax cash flow per share before non-recurring charges was $0.42 and $1.86 for the fourth quarter and full-year 2001, compared with $0.69 and $2.40 for the same periods in 2000. Including non-recurring charges, Belo incurred a per share loss of $0.02 in the fourth quarter and full-year 2001, compared with earnings per share of $0.76 and $1.29, respectively, for the comparable 2000 periods.

2001 and 2000 Non-Recurring Items Belo's reported per share loss of $0.02 for the fourth quarter of 2001 includes a non-recurring charge of $3.7 million, or $0.02 per share, related to severance costs for a Company-wide reduction-in-force and an early retirement program at The Providence Journal. In addition to the $0.02 charge from the fourth quarter, the full-year 2001 per share loss includes $0.19 in non-recurring charges recorded in the second quarter which resulted from a $29 million write-down of Belo's investments in certain Internet-related companies and a $4.5 million charge related to early retirements and corporate staff reductions.

Reported earnings per share of $0.76 and $1.29 for the fourth quarter and full-year 2000 include $0.58 and $0.56, respectively, from gains on the sales of The Gleaner in Henderson, Kentucky, the Messenger-Inquirer in Owensboro, Kentucky, The Eagle in Bryan-College Station, Texas and KOTV, the CBS affiliate in Tulsa, Oklahoma, a $0.10 benefit related to a legal settlement, a $0.16 initial write-down of investments in Internet-related companies, and $0.03 in other non-recurring charges. The other non-recurring charges include early retirement costs, a programming write-down and a charge related to a year-end advertiser bankruptcy.

Results of Operations

The following tables summarize Belo's fourth quarter and full-year performance. To take into account the non-recurring items in 2000 and 2001 referred to above, segment financial highlights are also presented on an "as adjusted" basis:

AS REPORTED

AS ADJUSTED 1

(in thousands)

(in thousands)

Three months ended Dec. 31,

Three months ended Dec. 31,

2001

2000
% Chg.

2001

2000
% Chg.
Net operating revenues

Television group

$ 155,777

$ 190,289
-18.1%

$ 155,777

$ 184,684
-15.7%
Newspaper group

185,452

224,942
-17.6%

185,452

215,530
-14.0%
Interactive media

3,349

2,729
22.7%

3,349

2,649
26.4%
Other

4,120

3,763
9.5%

4,120

3,763
9.5%
Segment revenues

$ 348,698

$ 421,723
-17.3%

$ 348,698

$ 406,626
-14.2%
Operating cash flow

Television group

$ 63,269

$ 88,284
-28.3%

$ 64,166

$ 88,289
-27.3%
Newspaper group

43,267

64,823
-33.3%

45,529

62,411
-27.0%
Interactive media

(3,194)

(4,860)
34.3%

(2,727)

(4,774)
42.9%
Other

(620)

(1,630)
62.0%

(601)

(1,630)
63.1%
Segment operating cash flow

$ 102,722

$ 146,617
-29.9%

$ 106,367

$ 144,296
-26.3%
After-tax cash flow per share 2

$ 0.40

$ 1.34
-70.1%

N/A

N/A
N/A
Earnings per share

$ (0.02)

$ 0.76
-102.6%

N/A

N/A
N/A

AS REPORTED

AS ADJUSTED 1

(in thousands)

(in thousands)

Twelve months ended Dec. 31,

Twelve months ended Dec. 31,

2001

2000
% Chg.

2001

2000
% Chg.
Net operating revenues

Television group

$ 597,869

$ 692,826
-13.7%

$ 597,869

$ 673,985
-11.3%
Newspaper group

737,481

871,380
-15.4%

737,481

829,862
-11.1%
Interactive media

13,065

10,319
26.6%

13,065

10,050
30.0%
Other

16,163

14,287
13.1%

16,163

14,287
13.1%
Segment revenues

$1,364,578

$1,588,812
-14.1%

$ 1,364,578

$ 1,528,184
-10.7%
Operating cash flow

Television group

$ 235,813

$ 302,876
-22.1%

$ 236,710

$ 298,738
-20.8%
Newspaper group

172,826

250,093
-30.9%

175,088

238,979
-26.7%
Interactive media

(16,966)

(16,987)
0.1%

(16,499)

(16,574)
0.5%
Other

(1,981)

(3,629)
45.4%

(1,962)

(3,628)
45.9%
Segment operating cash flow

$ 389,692

$ 532,353
-26.8%

$ 393,337

$ 517,515
-24.0%
After-tax cash flow per share 2

$ 1.81

$ 3.02
-40.1%

N/A

N/A
N/A
Earnings per share

$ (0.02)

$ 1.29
-101.6%

N/A

N/A
N/A

(1) Revenues and operating cash flows exclude the effects of the non-recurring items referred to above and have been adjusted for the following dispositions: The Gleaner in Henderson, Kentucky; The Eagle in Bryan-College Station, Texas; Messenger-Inquirer in Owensboro, Kentucky; and KOTV (CBS) in Tulsa, Oklahoma.

(2) After-tax cash flow per share is net earnings plus depreciation and amortization divided by the average shares outstanding. After-tax cash flow per share for the three months and twelve months ended December 31, 2000 excludes the non-cash expense associated with the initial write-down of certain Internet investments of $0.16. After tax-cash flow per share for the twelve months ended December 31, 2001 excludes the non-cash expense associated with the remaining write-down of certain Internet investments of $0.17.

2001 in Review Robert W. Decherd, Belo's chairman, president, and chief executive officer, said, "Belo ended the year somewhat better than we expected when we presented at the December conferences in New York. By responding aggressively to business conditions following September 11, the Company generated more than $125 million of free cash flow for 2001 despite a very chaotic advertising environment. This puts Belo in position to capitalize on an economic recovery as advertising revenues stabilize and improve.

"Belo's Television Group revenues decreased 15.7 percent on an as adjusted basis in the fourth quarter, with a 16.0 percent decrease in spot revenues. These revenue declines reflect the soft advertising environment, as well as challenging comparisons with 2000's fourth quarter, which benefited from political revenue of $28.9 million. Excluding political revenues, spot revenues were down 1.4 percent in the fourth quarter. For the full year, Television Group revenues were down 11.3 percent on an as adjusted basis with an 11.6 percent decrease in spot revenues. Excluding political revenues, full-year 2001 spot revenues were down 5 percent.

Even with difficult comparisons, Belo's Television Group revenue performance was at the high end of the network-affiliate segment in 2001. On an as adjusted basis, cash expenses were 5 percent better than the fourth quarter of 2000 and operating cash flow declined 27.3 percent. For the full year, cash expenses for the Television Group were 3.8 percent better than 2000 and operating cash flow declined 20.8 percent on an as adjusted basis.

"Newspaper Group revenues decreased 14.0 percent on an as adjusted basis in the fourth quarter, with advertising revenues down 16.3 percent. Full-year total revenues were down 11.1 percent on an as adjusted basis with a 12.8 percent decrease in advertising revenues.

The fourth quarter and full year of 2001 had one less Sunday than the fourth quarter and full year of 2000. Excluding the effect of the extra Sunday in 2000, total newspaper revenues were down approximately 11.6 percent in the fourth quarter and 10.5 percent for the full year. On an as adjusted basis, Newspaper Group cash expenses were 8.6 percent better than the fourth quarter of 2000 and 4.8 percent better for the full year, while operating cash flow for the Newspaper Group was down 27.0 percent in the fourth quarter and 26.7 percent for the full year.

"Total revenues at The Dallas Morning News were down 14.8 percent in the fourth quarter and 12.8 percent for the full year, excluding the effect of the extra Sunday in the fourth quarter and full-year 2000, due mostly to continued weakness in the classified employment category.

Employment revenue was down 59.7 percent in the fourth quarter and 44.0 percent for the full year.
"Belo Interactive's Web sites generated $3.3 million in revenue during the fourth quarter, compared to $2.6 million in the fourth quarter of 2000. The net investment in Belo Interactive operations in the fourth quarter was $2.7 million on an as adjusted basis compared with $4.8 million in the fourth quarter of 2000. The net investment in Belo Interactive for full-year 2001 was $16.5 million on an as adjusted basis, approximately the same amount as invested in 2000.
"Belo Interactive recorded 82 million page views per month in the fourth quarter of 2001, an increase of 21 percent over the 68 million page views in the fourth quarter of 2000. The number of unique visitors per month in the fourth quarter was 5.4 million, an increase of 15 percent over the 4.7 million unique visitors in the fourth quarter of 2000.

"Revenues at Belo's cable news operations increased 9.5 percent in the fourth quarter of 2001 to $4.1 million. Cash operating losses improved by 63.1 percent on an as adjusted basis, resulting in an overall fourth quarter investment of $600,000. For full-year 2001, total cable news revenues were up 13.1 percent to $16.2 million. Operating cash flow on an as adjusted basis improved 45.9 percent, resulting in an overall investment of $2.0 million."

At the beginning of 2002, Belo adopted Statement of Financial Accounting Standards (SFAS) No. 142 "Goodwill and Other Intangible Assets." Had the Company implemented SFAS No. 142 in 2001, Belo's amortization expense would have been reduced in 2001 from $81.5 million to approximately $7 million, resulting in an increase in earnings per share of $0.54.

Belo's total effective tax rate for 2001 would have been approximately 40 percent.

First Quarter 2002 Outlook
Decherd added, "Looking ahead, we believe Belo is in an enviable position as the economic recovery begins. In 2001, we reset expenses to match up with expected revenue generation. We enhanced the Company's capital structure in the fourth quarter, issuing $350 million in 7-year notes at 8 percent and renegotiating our 5-year revolving credit facility. We reduced capital spending for 2001 from an original plan of $112 million to $63 million. From an operating standpoint, we focused on growing market share in 2001 and made significant progress in most of Belo's markets. We believe Belo is positioned to be an early beneficiary when the economy rebounds.

"In the first quarter of 2002, the Television Group will benefit from the Winter Olympics on Belo's NBC affiliates and $3 to $4 million of political revenue. Currently, spot revenues for the first quarter are pacing down in the low to mid-single digits. In the Newspaper Group, it is too soon to be definitive about the first quarter as a whole, but we expect advertising revenues to be down less on a percentage basis than in the fourth quarter of 2001. The Dallas Morning News, like other large newspapers, continues to experience weak classified employment volumes and revenue. Employment volumes at The Dallas Morning News have stabilized, running 55 to 60 percent down each month since July 2001, but there are no significant signs of improvement yet.

"On the expense side, Belo is benefiting from the comprehensive cost-reduction measures implemented during 2001. In the first quarter of 2002, we expect total cash expenses to be better by 3 percent. If you include performance-based bonuses, which are only paid if financial targets are met, total cash expenses for the quarter will be better by about 2 percent.

"Assuming consumer confidence continues to stabilize, then improve, we are optimistic about Belo's prospects for 2002. Belo has great franchises and durable brands. And, because of the measures we took in 2001 to reset the Company's expense structure and increase market share, we are confident Belo will emerge from this cycle in a position of strength."

About Belo

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 $1.4 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 18 television stations (six in the top 16 markets) reaching 13.9 percent of U.S. television households; owns or operates six cable news channels; and manages two 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 Dunia Shive, Belo's executive vice president and chief financial officer, or Carey Hendrickson, Belo's vice president of investor relations, at 214-977-6606. Additional information, including earnings releases, is available online at http://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.