January 9, 2006
Belo Presents at Citigroup Conference
Phoenix, AZ -- Belo Corp. (NYSE: BLC) presented at the Citigroup 16th Annual Global Entertainment, Media & Telecommunications Conference in Phoenix today, providing an overview of the Company's business strategies, current operations, and 2006 financial outlook. Dennis Williamson, Belo's senior corporate vice president/Chief Financial Officer said, "Belo enters 2006 with strong operating momentum and an encouraging financial outlook for all of our operations."
Belo did not update fourth quarter 2005 guidance. The Company plans to report fourth quarter and full-year 2005 earnings on February 9, 2006, before the market opens, with a conference call to discuss details regarding the fourth quarter at 1 p.m. Central time.
Full-Year 2006 Outlook
Regarding Belo's 2006 financial outlook, Williamson summarized comments made by Company management at the December 2005 Media Week conferences. Williamson said, "We are optimistic about the potential for revenue growth that we see in all of our businesses in 2006. If revenues are developed as we currently anticipate, we expect consolidated EBITDA and earnings from operations to grow at a high-single digit rate for the full-year, including approximately $12 million in incremental stock-based compensation expense that we will expense for the first time in 2006, and the continuing recovery of the New Orleans market, which is not expected to return to pre-Katrina levels in 2006.
"Belo's Television Group should capture significant incremental revenue from the Super Bowl, the Olympics, and political advertising in 2006. For full-year 2006, Television Group spot revenue, including political revenue, is expected to increase in the mid-to-high single digits with total revenue up a like amount. Television Group expenses are expected to increase approximately three to four percent yielding a low-double digit increase in segment EBITDA and earnings from operations."
Regarding 2006 expectations for The Dallas Morning News, Williamson noted, "We currently expect full-year 2006 revenue at The Morning News to increase high-single to low-double digits with a mid-to-high single digit increase in advertising revenues. Full-year 2006 expenses are expected to increase high-single digits. The Morning News' 2006 projections include approximately $25 million in incremental circulation revenue and $21 million in incremental distribution expense related to the change from a buy-sell arrangement with contractors to a fee-for-delivery distribution system. Excluding the incremental circulation revenues and expenses, total revenues at The Dallas Morning News are expected to increase in the mid-single digits for full-year 2006 with advertising revenues up mid-to-high single digits, while expenses should increase only about four percent. The Morning News' contributions to Newspaper Group segment EBITDA and earnings from operations are expected to increase by a mid-teens percentage."
Revenues and expenses at The Dallas Morning News are expected to show significantly higher increases in the first half of 2006 than the second half of the year due to the timing of incremental revenues and expenses associated with circulation initiatives, 2005 new product introductions and advertising and promotion spending. Total revenues, which are projected to be up high-single to low-double digits for the full-year, are expected to increase low-double digits in the first half of 2006 with a high-single digit increase in the second half of 2006. Similarly, Morning News expenses, which are expected to increase high-single digits for full-year 2006, are expected to increase by mid-teens in the first half of 2006 with a low-single digit increase in the second half of the year.
The Company currently expects revenue at The Providence Journal and The Press-Enterprise to continue to increase at industry-leading rates in 2006. The
Providence Journal is expected to show a mid-to-high single digit increase in advertising revenues for full-year 2006 with a mid-single digit increase in total revenue. The Press Enterprise is expected to increase both advertising and total revenue by a mid-to-high single digit rate.
For the Newspaper Group overall, total revenues are expected to increase in the high-single digits with a mid-to-high single digit increase in advertising revenue. Total Newspaper Group expenses are expected to increase high-single digits with a resulting high-single digit increase in segment EBITDA and earnings from operations.
Williamson noted, "For Belo as a whole, revenues are expected to increase in the high-single digits with a mid-to-high single digit increase in expenses. Consolidated EBITDA and earnings from operations are projected to increase in the high-single digits for full-year 2006."
Additional information on Belo is available online at www.belo.com, including the full text of the presentation and the archived webcast.
Belo Corp. is one of the nation's largest media companies with a diversified group of market-leading television, newspaper, cable and interactive media assets. A Fortune 1000 company with 7,600 employees and $1.5 billion in annual revenues, Belo operates in some of America's most dynamic markets in Texas, the Northwest, the Southwest, Rhode Island, and the Mid-Atlantic. Belo owns 19 television stations, six of which are in the 15 largest U.S. broadcast markets. The Company also owns or operates seven cable news channels and manages one television station through a local marketing agreement. Belo's daily newspapers are The Dallas Morning News, The Providence Journal, The Press-Enterprise (Riverside, CA) and the Denton Record-Chronicle (Denton, TX). The Company also publishes specialty publications targeting young adults,and the fast-growing Hispanic market, including Quick and Al Dia in Dallas/Fort Worth, and El D and La Prensa in Riverside. Belo operates more than 30 Web sites associated with its operating companies. Additional information is available at www.belo.com or by contacting Carey Hendrickson, vice president/Investor Relations & Corporate Communications, at 214-977-6626.
Statements in this communication concerning Belo's business outlook or future economic performance, anticipated profitability, revenues, expenses, capital expenditures, investments, future financings or other financial and non-financial items 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 capital market conditions and prospects, and other factors such as changes in advertising demand, interest rates and newsprint prices; newspaper circulation matters, including changes in readership, and audits and related actions (including the censure of The Dallas Morning News) by the Audit Bureau of Circulations; technological changes, including the transition to digital television and the development of new systems to distribute television and other audio-visual content; development of Internet commerce; industry cycles; changes in pricing or other actions by competitors and suppliers; regulatory changes; adoption of new accounting standards or changes in existing accounting standards by the Financial Accounting Standards Board or other accounting standard-setting bodies or authorities; the effects of Company acquisitions and dispositions; the recovery of the New Orleans market from the effects of Hurricane Katrina; general economic conditions; and significant armed conflict, as well as other risks detailed in Belo's other public disclosures, and filings with the Securities and Exchange Commission ("SEC") including the Annual Report on Form 10-K.