July 30, 2010

Television Company Belo Corp. (BLC) Reports Results For Second Quarter 2010

Dallas, TX - Belo Corp. (NYSE: BLC), one of the nation's largest pure-play, publicly-traded television companies, today reported GAAP net earnings per share of $0.19 in the second quarter of 2010 compared to $0.10 per share in the second quarter of 2009.

Dunia A. Shive, Belo's president and Chief Executive Officer, said, "Our revenue momentum, which began in late 2009, continued throughout the second quarter of 2010 resulting in a 15 percent increase in total spot revenue compared to the second quarter of 2009. Our core spot advertising revenue, which excludes political, increased 14 percent in the second quarter of 2010 compared to the second quarter of 2009. This was an improvement from the year-to-year increase of 12 percent in core spot advertising revenue we experienced in the first quarter of 2010, which included Olympics and Super Bowl revenue. The Company's largest category, automotive, was up 51 percent in the second quarter of 2010 compared to the second quarter of 2009, an improvement from the year-to-year increase of 45 percent in the first quarter of 2010. We also experienced double-digit increases in several large categories like grocery and food products, retail, healthcare, financial services and home improvement. Political revenue of $2.5 million in the second quarter of 2010 increased $0.6 million from the second quarter of 2009, but was significantly less than the first quarter of 2010 due to the timing of political primaries in our markets. The Company's station EBITDA was $64 million in the second quarter of 2010, a 28 percent increase over the second quarter of 2009, and our station EBITDA margin in the second quarter of 2010 was 39 percent."

Second Quarter in Review
Operating Results
Total revenue increased 13 percent in the second quarter of 2010 versus the second quarter of 2009. Total spot revenue, including political, was up 15 percent, with increases of 10 percent and 24 percent in local and national spot, respectively. The second quarter 2010 revenue increases were the result of an improved advertising environment, led by the automotive category which was up 51 percent. Political revenue in the second quarter of 2010 was $2.5 million compared to $1.9 million in the second quarter of 2009.

Revenue associated with Belo's Web sites increased 14 percent to $8.1 million in the second quarter of 2010 versus 2009. Retransmission revenue totaled $11.7 million in the second quarter of 2010.

Station salaries, wages and employee benefits increased $6.4 million in the second quarter of 2010 versus the second quarter of 2009 due primarily to a non-cash credit of $3 million in the second quarter of 2009 related to the conversion to a paid time-off (PTO) vacation policy, a $1.5 million increase in accrued bonus expense and a $1.6 million increase in pension expense, which included the reinstatement of the pension transition supplement that was suspended in 2009.

Station programming and other operating costs decreased $2.2 million due primarily to a $2.3 million favorable non-cash expense variance in the second quarter of 2010 related to third-party funding of certain newsgathering equipment.

Station EBITDA of $64 million for the second quarter of 2010 was up 28 percent versus the second quarter of 2009. The station EBITDA margin for the second quarter of 2010 was 39 percent compared to 35 percent in the second quarter of 2009.

Corporate
Corporate operating costs of $7.9 million in the second quarter of 2010 were $2.7 million higher than the second quarter of 2009 due primarily to higher pension expense of $1.6 million in the second quarter of 2010 and an increase of $1.1 million in accrued bonus expense. Decreases in other corporate operating costs offset a $1.7 million insurance reimbursement in the second quarter of 2009.

In the Company's first quarter earnings release dated May 3, 2010, several factors were noted that would affect combined station and corporate operating costs for the second quarter. Below is a list of those factors with their actual impact on second quarter expenses:

- a $3.4 million non-cash credit in the second quarter of 2009 related to the conversion to a PTO vacation policy;
- $1.7 million insurance reimbursement in the second quarter of 2009;
- $3.2 million increase in pension expense in the second quarter of 2010, which included the reinstatement of the pension transition supplement that was suspended last year;
- $2.6 million increase in accrued bonus expense in the second quarter of 2010 compared to virtually no bonus expense last year; and,
- $2.3 million favorable non-cash expense variance related to third-party funding of certain newsgathering equipment in the second quarter of 2010.

In its first quarter earnings release, the Company projected that, excluding the above items, second quarter combined station and corporate operating costs would be up in the low-to-mid single digits. Combined station and corporate operating costs for the second quarter of 2010, excluding the above items, were actually down 1.5 percent.

Other Items
The Company recorded a reduction in operating expenses of $4.2 million in the second quarter of 2010 related to pension contribution reimbursements received from A. H. Belo Corporation related to its obligation to reimburse Belo for 60 percent of any pension contributions Belo makes to The G. B. Dealey Retirement Pension Plan. This credit is shown as a separate component of total operating costs and expenses on Belo's Consolidated Statements of Operations. The Company expects to recognize a much smaller pension contribution reimbursement in the third quarter of 2010.

Belo's depreciation expense totaled $8.8 million in the second quarter of 2010, down from $10 million in the second quarter of 2009.

The Company's interest expense increased $4.5 million compared to the second quarter of 2009 due primarily to increased interest costs associated with the Company's $275 million senior note offering completed in the fourth quarter of 2009 and the amortization of the discount and refinancing costs associated with the note offering. These borrowings were previously included in the Company's lower-rate revolving credit facility.

Other income, net, increased $3.2 million in the second quarter of 2010 due primarily to costs recognized in the second quarter of 2009 related to the relocation of the Company's bureau in Washington, D.C., and an increase in the reserve for an investment.

Income tax expense increased $6.2 million in the second quarter of 2010 compared to the second quarter of 2009 due primarily to higher pre-tax earnings.

Total debt at June 30, 2010, was $990 million, a reduction of $39 million from December 31, 2009. The Company's total leverage ratio, as defined in the Company's credit facility, was 4.7 times at June 30, 2010, down from 5.0 times at March 31, 2010 and 5.9 times at December 31, 2009. Belo invested $3.8 million in capital expenditures in the second quarter of 2010 and currently expects full year capital expenditures to be approximately $15 million.

Non-GAAP Financial Measures
A reconciliation of station EBITDA to earnings from operations and a reconciliation of net earnings to pro forma net earnings are set forth in an exhibit to this release.

2010 Outlook
Looking to the third quarter, Shive said, "We continue to expect robust political spending in the third quarter and throughout the back half of the year, which will cause some crowd-out of core spot revenue as is always the case when there are significant political dollars. Total spot revenue in July is expected to finish up 13 to 14 percent, continuing the positive trend we have seen throughout 2010. The months of August and September are expected to have greater political revenue than July and are currently pacing above the July level. Based on these pacing trends, total spot advertising revenue could increase in the high teens in the third quarter of 2010 compared to the third quarter of 2009 depending on the strength of political revenue.

Combined station and corporate operating costs will be up in the third quarter of 2010 compared to the third quarter of 2009 due to several factors listed below.
- The Company's conversion to a PTO vacation policy in 2009 resulted in a $1.6 million non-cash credit in the third quarter of 2009.
- Pension expense is estimated to be $2.3 million higher in the third quarter of 2010 compared to 2009's third quarter, including the effect of reinstating the pension transition supplement benefit that was suspended last year.
- Accrued bonus expenses, including revenue-based bonuses, are currently estimated to be $3.1 million in the third quarter of 2010 compared to virtually no bonus expense last year.

Excluding the above items, third quarter combined station and corporate operating costs are currently expected to be up in the low-to-mid single digits. This increase is due to the lifting of the wage freeze and partial reinstatement of salary reductions in April of 2010, higher sales-related costs associated with higher revenue, and investments in new local programs. On a reported basis, combined station and corporate operating costs are expected to be up approximately 10 percent versus the third quarter of 2009.

A conference call to discuss this release and other matters of interest to shareholders and analysts will follow at 1:00 p.m. CDT this afternoon. The conference call will be simultaneously Webcast on Belo Corp.'s Web site (www.belo.com/invest). Following the conclusion of the Webcast, a replay of the conference call will be archived on Belo's Web site. To access the listen-only conference lines, dial 1-800-230-1074. A replay line will be open from 3:00 p.m. CDT on July 30 until 11:59 p.m. CDT August 13. To access the replay, dial 800-475-6701 or 320-365-3844. The access code for the replay is 164258.

About Belo Corp.
Belo Corp. (BLC), one of the nation's largest pure-play, publicly-traded television companies, owns and operates 20 television stations (nine in the top 25 markets) and their associated Web sites. Belo stations, which include affiliations with ABC, CBS, NBC, FOX, and the CW, reach more than 14 percent of U.S. television households in 15 highly- attractive markets. Belo stations rank first or second in nearly all of their local markets. Additional information is available at www.belo.com or by contacting Paul Fry, vice president/Investor Relations & Treasury Operations, at 214-977-6835.

Statements in this communication concerning Belo's business outlook or future economic performance, anticipated profitability, revenues, expenses, capital expenditures, investments, future financings, impairments, pension matters, and 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, uncertainties regarding the costs, consequences (including tax consequences) and other effects of the Company's spin-off distribution of its newspaper businesses and related assets to A. H. Belo Corporation and the associated agreements between the Company and A. H. Belo relating to various matters; changes in capital market conditions and prospects, and other factors such as changes in advertising demand, interest rates and programming and production costs; changes in viewership patterns and demography, and actions by Nielsen; changes in the network-affiliate business model for broadcast television; technological changes, and the development of new systems to distribute television and other audio-visual content; changes in the ability to secure, and in the terms of, carriage of Belo programming on cable, satellite, telecommunications and other program distribution methods; development of Internet commerce; industry cycles; changes in pricing or other actions by competitors and suppliers; Federal Communications Commission and other regulatory, tax and legal 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, dispositions, co-owned ventures, and investments; pension plan matters; general economic conditions; and significant armed conflict, as well as other risks detailed in Belo's other public disclosures and filings with the SEC including Belo's Annual Report on Form 10-K.


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