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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Lee Enterprises Inc | NYSE:LEE | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 28.50 | 0 | 01:00:00 |
|
|
|
Delaware
|
42-0823980
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
Large accelerated filer
|
[ ]
|
Accelerated filer
|
[X]
|
|
Non-accelerated filer
|
[ ]
(Do not check if a smaller reporting company)
|
Smaller reporting company
|
[ ]
|
|
Table Of Contents
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PAGE
|
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FORWARD LOOKING STATEMENTS
|
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PART I
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FINANCIAL INFORMATION
|
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Item 1.
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Financial Statements (Unaudited)
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|
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Consolidated Balance Sheets - June 29, 2014 and September 29, 2013
|
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Consolidated Statements of Operations and Comprehensive Income (Loss) - 13 weeks and 39 weeks ended June 29, 2014 and June 30, 2013
|
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Consolidated Statements of Cash Flows - 39 weeks ended June 29, 2014 and June 30, 2013
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Notes to Consolidated Financial Statements
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Item 2.
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Management's Discussion and Analysis of Financial Condition and Results of Operations
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Item 3.
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Quantitative and Qualitative Disclosures About Market Risk
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Item 4.
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Controls and Procedures
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PART II
|
OTHER INFORMATION
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|
||
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Item 1.
|
Legal Proceedings
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|
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Item 6.
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Exhibits
|
|
|
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SIGNATURES
|
|
|
(Thousands of Dollars)
|
June 29
2014 |
|
September 29
2013 |
|
|
|
|
||
ASSETS
|
|
|
||
|
|
|
||
Current assets:
|
|
|
||
Cash and cash equivalents
|
17,758
|
|
17,562
|
|
Accounts receivable, net
|
61,577
|
|
63,215
|
|
Income taxes receivable
|
—
|
|
6,634
|
|
Inventories
|
6,325
|
|
6,409
|
|
Deferred income taxes
|
2,017
|
|
2,017
|
|
Other
|
9,237
|
|
8,488
|
|
Total current assets
|
96,914
|
|
104,325
|
|
Investments:
|
|
|
||
Associated companies
|
38,182
|
|
39,489
|
|
Other
|
11,179
|
|
10,558
|
|
Total investments
|
49,361
|
|
50,047
|
|
Property and equipment:
|
|
|
||
Land and improvements
|
23,645
|
|
23,626
|
|
Buildings and improvements
|
184,854
|
|
184,838
|
|
Equipment
|
296,104
|
|
299,828
|
|
Construction in process
|
3,745
|
|
2,868
|
|
|
508,348
|
|
511,160
|
|
Less accumulated depreciation
|
347,474
|
|
342,247
|
|
Property and equipment, net
|
160,874
|
|
168,913
|
|
Goodwill
|
243,729
|
|
243,729
|
|
Other intangible assets, net
|
221,474
|
|
242,184
|
|
Postretirement assets, net
|
16,010
|
|
14,956
|
|
Other
|
39,808
|
|
3,551
|
|
|
|
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||
|
|
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||
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|
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||
|
|
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||
|
|
|
||
Total assets
|
828,170
|
|
827,705
|
|
(Thousands of Dollars and Shares, Except Per Share Data)
|
June 29
2014 |
|
September 29
2013 |
|
|
|
|
||
LIABILITIES AND EQUITY
|
|
|
||
|
|
|
||
Current liabilities:
|
|
|
||
Current maturities of long-term debt
|
29,400
|
|
14,371
|
|
Accounts payable
|
22,116
|
|
22,448
|
|
Compensation and other accrued liabilities
|
26,045
|
|
28,493
|
|
Accrued interest
|
13,386
|
|
9,074
|
|
Unearned revenue
|
31,952
|
|
32,605
|
|
Total current liabilities
|
122,899
|
|
106,991
|
|
Long-term debt, net of current maturities
|
785,600
|
|
820,187
|
|
Pension obligations
|
28,580
|
|
30,583
|
|
Postretirement and postemployment benefit obligations
|
7,695
|
|
7,253
|
|
Deferred income taxes
|
20,585
|
|
21,224
|
|
Income taxes payable
|
5,947
|
|
5,257
|
|
Other
|
21,858
|
|
5,900
|
|
Total liabilities
|
993,164
|
|
997,395
|
|
Equity (deficit):
|
|
|
||
Stockholders' equity (deficit):
|
|
|
||
Serial convertible preferred stock, no par value; authorized 500 shares; none issued
|
—
|
|
—
|
|
Common Stock, $0.01 par value; authorized 120,000 shares; issued and outstanding:
|
537
|
|
524
|
|
June 29, 2014; 53,694 shares;
|
|
|
||
September 29, 2013; 52,434 shares
|
|
|
||
Class B Common Stock, $2 par value; authorized 30,000 shares; none issued
|
—
|
|
—
|
|
Additional paid-in capital
|
244,847
|
|
242,537
|
|
Accumulated deficit
|
(417,445
|
)
|
(421,077
|
)
|
Accumulated other comprehensive income
|
6,342
|
|
7,666
|
|
Total stockholders' deficit
|
(165,719
|
)
|
(170,350
|
)
|
Non-controlling interests
|
725
|
|
660
|
|
Total deficit
|
(164,994
|
)
|
(169,690
|
)
|
Total liabilities and deficit
|
828,170
|
|
827,705
|
|
|
13 Weeks Ended
|
|
39 Weeks Ended
|
|
||||
(Thousands of Dollars, Except Per Common Share Data)
|
June 29
2014 |
|
June 30
2013 |
|
June 29
2014 |
|
June 30
2013 |
|
|
|
|
|
|
||||
Operating revenue:
|
|
|
|
|
||||
Advertising and marketing services
|
110,284
|
|
113,944
|
|
335,394
|
|
350,225
|
|
Subscription
|
43,339
|
|
43,583
|
|
130,744
|
|
133,609
|
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Other
|
9,502
|
|
9,492
|
|
28,465
|
|
28,443
|
|
Total operating revenue
|
163,125
|
|
167,019
|
|
494,603
|
|
512,277
|
|
Operating expenses:
|
|
|
|
|
|
|||
Compensation
|
60,330
|
|
62,340
|
|
181,543
|
|
192,505
|
|
Newsprint and ink
|
9,224
|
|
10,471
|
|
29,120
|
|
33,357
|
|
Other operating expenses
|
53,840
|
|
53,461
|
|
161,708
|
|
160,929
|
|
Depreciation
|
5,293
|
|
5,327
|
|
15,700
|
|
16,123
|
|
Amortization of intangible assets
|
6,901
|
|
9,542
|
|
20,710
|
|
28,635
|
|
Loss (gain) on sales of assets, net
|
9
|
|
(112
|
)
|
(1,622
|
)
|
23
|
|
Impairment of goodwill and other assets
|
336
|
|
—
|
|
336
|
|
—
|
|
Workforce adjustments
|
419
|
|
945
|
|
925
|
|
2,260
|
|
Total operating expenses
|
136,352
|
|
141,974
|
|
408,420
|
|
433,832
|
|
Equity in earnings of associated companies
|
1,836
|
|
1,893
|
|
6,348
|
|
6,671
|
|
Operating income
|
28,609
|
|
26,938
|
|
92,531
|
|
85,116
|
|
Non-operating income (expense):
|
|
|
|
|
||||
Financial income
|
85
|
|
134
|
|
306
|
|
219
|
|
Interest expense
|
(19,654
|
)
|
(21,991
|
)
|
(61,033
|
)
|
(68,390
|
)
|
Debt financing costs
|
(21,732
|
)
|
(468
|
)
|
(21,935
|
)
|
(557
|
)
|
Other, net
|
(1,701
|
)
|
520
|
|
(1,579
|
)
|
7,466
|
|
Total non-operating expense, net
|
(43,002
|
)
|
(21,805
|
)
|
(84,241
|
)
|
(61,262
|
)
|
Income (loss) before income taxes
|
(14,393
|
)
|
5,133
|
|
8,290
|
|
23,854
|
|
Income tax expense (benefit)
|
(4,882
|
)
|
3,165
|
|
3,995
|
|
11,805
|
|
Income (loss) from continuing operations
|
(9,511
|
)
|
1,968
|
|
4,295
|
|
12,049
|
|
Discontinued operations, net of income taxes
|
—
|
|
—
|
|
—
|
|
(1,247
|
)
|
Net income (loss)
|
(9,511
|
)
|
1,968
|
|
4,295
|
|
10,802
|
|
Net income attributable to non-controlling interests
|
(235
|
)
|
(173
|
)
|
(663
|
)
|
(430
|
)
|
Income (loss) attributable to Lee Enterprises, Incorporated
|
(9,746
|
)
|
1,795
|
|
3,632
|
|
10,372
|
|
Other comprehensive loss, net of income taxes
|
(441
|
)
|
(93
|
)
|
(1,324
|
)
|
(280
|
)
|
Comprehensive income (loss) attributable to Lee Enterprises, Incorporated
|
(10,187
|
)
|
1,702
|
|
2,308
|
|
10,092
|
|
Income (loss) from continuing operations attributable to Lee Enterprises, Incorporated
|
(9,746
|
)
|
1,795
|
|
3,632
|
|
11,619
|
|
Earnings (loss) per common share:
|
|
|
|
|
||||
Basic:
|
|
|
|
|
||||
Continuing operations
|
(0.19
|
)
|
0.03
|
|
0.07
|
|
0.22
|
|
Discontinued operations
|
—
|
|
—
|
|
—
|
|
(0.02
|
)
|
|
(0.19
|
)
|
0.03
|
|
0.07
|
|
0.20
|
|
Diluted:
|
|
|
|
|
||||
Continuing operations
|
(0.19
|
)
|
0.03
|
|
0.07
|
|
0.22
|
|
Discontinued operations
|
—
|
|
—
|
|
—
|
|
(0.02
|
)
|
|
(0.19
|
)
|
0.03
|
|
0.07
|
|
0.20
|
|
|
39 Weeks Ended
|
|
||
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
|
|
|
||
Cash provided by operating activities:
|
|
|
||
Net income
|
4,295
|
|
10,802
|
|
Results of discontinued operations
|
—
|
|
(1,247
|
)
|
Income from continuing operations
|
4,295
|
|
12,049
|
|
Adjustments to reconcile income from continuing operations to net cash provided by operating activities of continuing operations:
|
|
|
||
Depreciation and amortization
|
36,410
|
|
44,758
|
|
Loss (gain) on sales of assets, net
|
(1,622
|
)
|
23
|
|
Impairment of goodwill and other assets
|
336
|
|
—
|
|
Amortization of debt present value adjustment
|
2,394
|
|
3,932
|
|
Stock compensation expense
|
1,081
|
|
1,109
|
|
Distributions greater than earnings of MNI
|
1,518
|
|
1,342
|
|
Deferred income tax expense
|
281
|
|
2,022
|
|
Debt financing costs
|
21,935
|
|
527
|
|
Gain on sale of investments
|
—
|
|
(7,093
|
)
|
Changes in operating assets and liabilities:
|
|
|
||
Decrease in receivables
|
1,638
|
|
4,044
|
|
Decrease (increase) in inventories and other
|
(502
|
)
|
409
|
|
Decrease in accounts payable, compensation and other accrued liabilities and unearned revenue
|
1,097
|
|
(6,946
|
)
|
Decrease in pension, postretirement and postemployment benefit obligations
|
(4,858
|
)
|
(8,310
|
)
|
Change in income taxes receivable or payable
|
7,324
|
|
9,423
|
|
Other, net
|
(1,744
|
)
|
(1,237
|
)
|
Net cash provided by operating activities of continuing operations
|
69,583
|
|
56,052
|
|
Cash provided by (required for) investing activities of continuing operations:
|
|
|
||
Purchases of property and equipment
|
(8,204
|
)
|
(6,835
|
)
|
Proceeds from sales of assets
|
2,192
|
|
7,615
|
|
Distributions greater (less) than earnings of TNI
|
(211
|
)
|
166
|
|
Other, net
|
—
|
|
(330
|
)
|
Net cash provided by (required for) investing activities of continuing operations
|
(6,223
|
)
|
616
|
|
Cash provided by (required for) financing activities of continuing operations:
|
|
|
||
Proceeds from long-term debt
|
800,000
|
|
94,000
|
|
Payments on long-term debt
|
(832,500
|
)
|
(166,350
|
)
|
Debt financing costs paid
|
(31,276
|
)
|
(766
|
)
|
Common stock transactions, net
|
612
|
|
21
|
|
Net cash required for financing activities of continuing operations
|
(63,164
|
)
|
(73,095
|
)
|
Net cash provided by (required for) discontinued operations:
|
|
|
||
Operating activities
|
—
|
|
(552
|
)
|
Investing activities
|
—
|
|
14,689
|
|
Net increase (decrease) in cash and cash equivalents
|
196
|
|
(2,290
|
)
|
Cash and cash equivalents:
|
|
|
||
Beginning of period
|
17,562
|
|
13,920
|
|
End of period
|
17,758
|
|
11,630
|
|
1
|
BASIS OF PRESENTATION
|
|
(Thousands of Dollars)
|
February 28
2013 |
|
|
|
|
|
|
Current assets
|
433
|
|
|
Property and equipment, net
|
770
|
|
|
Goodwill
|
500
|
|
|
Other intangible assets, net
|
4,025
|
|
|
Current liabilities
|
(271
|
)
|
|
Assets, net
|
5,457
|
|
|
(Thousands of Dollars)
|
September 30
2012 |
|
|
|
|
|
|
Current assets
|
2,093
|
|
|
Property and equipment, net
|
5,158
|
|
|
Goodwill
|
3,042
|
|
|
Other intangible assets, net
|
1,920
|
|
|
Current liabilities
|
(1,714
|
)
|
|
Assets, net
|
10,499
|
|
|
|
|
39 Weeks Ended
|
|
|
(Thousands of Dollars)
|
|
June 30
2013 |
|
|
|
|
|
|
|
Operating revenue
|
|
1,321
|
|
|
Costs and expenses
|
|
(1,697
|
)
|
|
Gain on sale of the
North County Times
|
|
1,800
|
|
|
Loss on sale of
The Garden Island
|
|
(3,340
|
)
|
|
Gain from discontinued operations, before income taxes
|
|
(1,916
|
)
|
|
Income tax expense
|
|
(669
|
)
|
|
Net loss
|
|
(1,247
|
)
|
|
|
13 Weeks Ended
|
|
39 Weeks Ended
|
|
40 Weeks Ended
|
|
||
|
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
June 29
2014 |
|
June 30
2013 |
|
|
|
|
|
|
|
||||
|
Operating revenue
|
13,750
|
|
14,644
|
|
44,888
|
|
48,110
|
|
|
Operating expenses, excluding workforce adjustments, depreciation and amortization
|
11,449
|
|
12,300
|
|
36,116
|
|
39,051
|
|
|
Workforce adjustments
|
—
|
|
—
|
|
(87
|
)
|
—
|
|
|
Operating income
|
2,301
|
|
2,344
|
|
8,859
|
|
9,059
|
|
|
Company's 50% share of operating income
|
1,150
|
|
1,171
|
|
4,429
|
|
4,530
|
|
|
Less amortization of intangible assets
|
104
|
|
155
|
|
313
|
|
517
|
|
|
Equity in earnings of TNI
|
1,046
|
|
1,016
|
|
4,116
|
|
4,013
|
|
|
|
13 Weeks Ended
|
|
39 Weeks Ended
|
|
||||
|
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
June 29
2014 |
|
June 30
2013 |
|
|
|
|
|
|
|
||||
|
Operating revenue
|
17,278
|
|
16,044
|
|
50,710
|
|
50,075
|
|
|
Operating expenses, excluding workforce adjustments, depreciation and amortization
|
14,390
|
|
12,773
|
|
42,246
|
|
40,450
|
|
|
Workforce adjustments
|
15
|
|
74
|
|
244
|
|
63
|
|
|
Depreciation and amortization
|
384
|
|
383
|
|
1,179
|
|
1,147
|
|
|
Operating income
|
2,489
|
|
2,814
|
|
7,041
|
|
8,415
|
|
|
Net income
|
1,579
|
|
1,754
|
|
4,464
|
|
5,249
|
|
|
Equity in earnings of MNI
|
790
|
|
876
|
|
2,232
|
|
2,658
|
|
4
|
GOODWILL AND OTHER INTANGIBLE ASSETS
|
|
|
39 Weeks Ended
|
|
|
(Thousands of Dollars)
|
June 29
2014 |
|
|
|
|
|
|
Goodwill, gross amount
|
1,532,458
|
|
|
Accumulated impairment losses
|
(1,288,729
|
)
|
|
Goodwill, beginning of period
|
243,729
|
|
|
Goodwill, end of period
|
243,729
|
|
|
(Thousands of Dollars)
|
June 29
2014 |
|
September 29
2013 |
|
|
|
|
|
||
|
Nonamortized intangible assets:
|
|
|
||
|
Mastheads
|
27,038
|
|
27,038
|
|
|
Amortizable intangible assets:
|
|
|
||
|
Customer and newspaper subscriber lists
|
686,732
|
|
686,732
|
|
|
Less accumulated amortization
|
492,298
|
|
471,589
|
|
|
|
194,434
|
|
215,143
|
|
|
Noncompete and consulting agreements
|
28,524
|
|
28,524
|
|
|
Less accumulated amortization
|
28,522
|
|
28,521
|
|
|
|
2
|
|
3
|
|
|
|
221,474
|
|
242,184
|
|
5
|
DEBT
|
•
|
$400,000,000
aggregate principal amount of
9.5%
Senior Secured Notes (the “Notes”), pursuant to an Indenture dated as of March 31, 2014 (the “Indenture”) among the Company, certain subsidiaries party thereto from time to time (the “Subsidiary Guarantors”), U.S. Bank National Association, as Trustee (the "Notes Trustee"), and Deutsche Bank Trust Company Americas, as Collateral Agent;
|
•
|
$250,000,000
first lien term loan and
$40,000,000
revolving facility under a First Lien Credit Agreement dated as of March 31, 2014 (the “ 1
st
Lien Credit Facility”) among the Company, the lenders party thereto from time to time (the “1
st
Lien Lenders”), and JPMorgan Chase Bank, N.A., as Administrative Agent and Collateral Agent; and
|
•
|
$150,000,000
second lien term loan under a Second Lien Loan Agreement dated as of March 31, 2014 (the “ 2
nd
Lien Term Loan”) among the Company, the lenders party thereto from time to time (the “2
nd
Lien Lenders”), and Wilmington Trust, National Association, as Administrative Agent and Collateral Agent.
|
Period Beginning
|
Percentage of Principal Amount
|
|
|
|
|
March 15, 2018
|
104.75
|
|
March 15, 2019
|
102.375
|
|
March 15, 2020
|
100
|
|
•
|
A Pari Passu Intercreditor Agreement dated as of March 31, 2014 (the “Pari Passu Intercreditor Agreement”) among the Company, the other Grantors party thereto, JPMorgan Chase Bank, N.A., U.S. Bank National Association and Deutsche Bank Trust Company Americas; and
|
•
|
A Junior Intercreditor Agreement dated as of March 31, 2014 (the “Junior Intercreditor Agreement”) among the Company, the other Grantors party hereto, JPMorgan Chase Bank, N.A., U.S. Bank National Association, Deutsche Bank Trust Company Americas and Wilmington Trust, National Association.
|
|
13 Weeks Ended
|
|
13 Weeks Ending
|
|
||||
(Thousands of Dollars)
|
December 29
2013 |
|
March 30
2014 |
|
June 29
2014 |
|
September 28
2014 |
|
|
|
|
|
|
||||
Mandatory
|
3,000
|
|
3,000
|
|
6,250
|
|
6,250
|
|
Voluntary
|
3,350
|
|
5,500
|
|
10,750
|
|
—
|
|
Asset sales
|
150
|
|
1,500
|
|
—
|
|
—
|
|
Excess cash flow
|
—
|
|
—
|
|
—
|
|
—
|
|
|
6,500
|
|
10,000
|
|
17,000
|
|
6,250
|
|
|
|
|
13 Weeks Ended
|
|
||||
(Thousands of Dollars)
|
December 30
2012 |
|
March 31
2013 |
|
June 30
2013 |
|
September 29
2013 |
|
|
|
|
|
|
||||
Mandatory
|
2,500
|
|
2,500
|
|
3,000
|
|
3,000
|
|
Voluntary
|
9,750
|
|
15,350
|
|
2,260
|
|
6,000
|
|
Asset sales
|
7,750
|
|
—
|
|
240
|
|
—
|
|
Excess cash flow
|
—
|
|
—
|
|
—
|
|
—
|
|
|
20,000
|
|
17,850
|
|
5,500
|
|
9,000
|
|
•
|
The Pari Passu Intercreditor Agreement;
|
•
|
The Junior Intercreditor Agreement; and
|
•
|
An Intercompany Subordination Agreement dated as of March 31, 2014 (the “1
st
Lien Intercompany Subordination Agreement”) among the Company, Subsidiary Guarantors, Pulitzer, Pulitzer Subsidiaries and JPMorgan Chase Bank, N.A.
|
•
|
The Junior Intercreditor Agreement;
|
•
|
An Intercreditor Agreement dated as of January 30, 2012 among The Bank of New York Mellon Trust Company, N.A., Wilmington Trust, National Association, Pulitzer and the Pulitzer Subsidiaries, as amended by the First Amendment to Intercreditor Agreement dated May 1, 2013, and as further amended by the Second Amendment to Intercreditor Agreement dated as of March 31, 2014 (the “Second Amendment to Pulitzer Intercreditor Agreement”); and
|
•
|
An Intercompany Subordination Agreement dated as of March 31, 2014 (the “Pulitzer Intercompany Subordination Agreement”) among the Company, the Subsidiary Guarantors, Pulitzer, Pulitzer Subsidiaries and Wilmington Trust, National Association.
|
|
13 Weeks Ended
|
|
13 Weeks Ending
|
|
||||
(Thousands of Dollars)
|
December 29
2013 |
|
March 30
2014 |
|
June 29
2014 |
|
September 28
2014 |
|
|
|
|
|
|
||||
Mandatory
|
6,400
|
|
—
|
|
—
|
|
—
|
|
Voluntary
|
1,600
|
|
10,000
|
|
13,000
|
|
—
|
|
Asset sales
|
—
|
|
—
|
|
—
|
|
—
|
|
Excess cash flow
|
—
|
|
—
|
|
—
|
|
—
|
|
|
8,000
|
|
10,000
|
|
13,000
|
|
—
|
|
|
|
|
13 Weeks Ended
|
|
||||
(Thousands of Dollars)
|
December 30
2012 |
|
March 31
2013 |
|
June 30
2013 |
|
September 29
2013 |
|
|
|
|
|
|
||||
Mandatory
|
3,800
|
|
2,600
|
|
—
|
|
—
|
|
Voluntary
|
—
|
|
1,500
|
|
14,000
|
|
17,000
|
|
Asset sales
|
5,200
|
|
1,900
|
|
—
|
|
—
|
|
Excess cash flow
|
—
|
|
—
|
|
—
|
|
—
|
|
|
9,000
|
|
6,000
|
|
14,000
|
|
17,000
|
|
|
|
|
Interest Rates
(%)
|
||
(Thousands of Dollars)
|
June 29
2014 |
|
September 29
2013 |
|
June 29
2014 |
|
|
|
|
||
Revolving Facility
|
—
|
|
—
|
|
6.75
|
1st Lien Term Loan
|
233,000
|
|
—
|
|
7.25
|
Notes
|
400,000
|
|
—
|
|
9.50
|
2
nd
Lien Term Loan
|
150,000
|
|
—
|
|
12.00
|
New Pulitzer Notes
|
32,000
|
|
63,000
|
|
9.00
|
Previous credit agreements
|
—
|
|
784,500
|
|
|
Unamortized present value adjustment
|
—
|
|
(12,942
|
)
|
|
|
815,000
|
|
834,558
|
|
|
Less current maturities of long-term debt
|
29,400
|
|
19,150
|
|
|
Current amount of present value adjustment
|
—
|
|
(4,779
|
)
|
|
Total long-term debt
|
785,600
|
|
820,187
|
|
|
6
|
PENSION, POSTRETIREMENT AND POSTEMPLOYMENT DEFINED BENEFIT PLANS
|
|
PENSION PLANS
|
13 Weeks Ended
|
|
39 Weeks Ended
|
|
||||
|
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
June 29
2014 |
|
June 30
2013 |
|
|
|
|
|
|
|
||||
|
Service cost for benefits earned during the period
|
39
|
|
54
|
|
117
|
|
162
|
|
|
Interest cost on projected benefit obligation
|
1,999
|
|
1,882
|
|
5,997
|
|
5,646
|
|
|
Expected return on plan assets
|
(2,483
|
)
|
(2,459
|
)
|
(7,449
|
)
|
(7,377
|
)
|
|
Amortization of net loss
|
106
|
|
572
|
|
318
|
|
1,716
|
|
|
Amortization of prior service benefit
|
(34
|
)
|
(34
|
)
|
(102
|
)
|
(102
|
)
|
|
|
(373
|
)
|
15
|
|
(1,119
|
)
|
45
|
|
|
|
|
|
|
|
||||
|
POSTRETIREMENT MEDICAL PLANS
|
13 Weeks Ended
|
|
39 Weeks Ended
|
|
||||
|
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
June 29
2014 |
|
June 30
2013 |
|
|
|
|
|
|
|
||||
|
Service cost for benefits earned during the period
|
149
|
|
182
|
|
447
|
|
546
|
|
|
Interest cost on projected benefit obligation
|
228
|
|
281
|
|
684
|
|
843
|
|
|
Expected return on plan assets
|
(371
|
)
|
(368
|
)
|
(1,113
|
)
|
(1,104
|
)
|
|
Amortization of net gain
|
(455
|
)
|
(331
|
)
|
(1,365
|
)
|
(993
|
)
|
|
Amortization of prior service benefit
|
(365
|
)
|
(365
|
)
|
(1,095
|
)
|
(1,095
|
)
|
|
|
(814
|
)
|
(601
|
)
|
(2,442
|
)
|
(1,803
|
)
|
7
|
INCOME TAXES
|
|
|
13 Weeks Ended
|
|
39 Weeks Ended
|
|
||||
|
(Percent of Income (Loss) Before Income Taxes)
|
June 29
2014 |
|
June 30
2013 |
|
June 29
2014 |
|
June 30
2013 |
|
|
|
|
|
|
|
||||
|
Computed “expected” income tax expense (benefit)
|
(35.0
|
)
|
35.0
|
|
35.0
|
|
35.0
|
|
|
State income taxes (benefit), net of federal tax effect
|
(3.3
|
)
|
3.5
|
|
3.5
|
|
3.4
|
|
|
Dividends received deductions and credits
|
1.3
|
|
(8.4
|
)
|
(6.5
|
)
|
(5.9
|
)
|
|
Valuation allowance
|
—
|
|
(1.8
|
)
|
(15.4
|
)
|
4.2
|
|
|
Domestic production reduction
|
—
|
|
3.4
|
|
—
|
|
3.4
|
|
|
Resolution of tax matters
|
3.4
|
|
5.0
|
|
14.9
|
|
2.6
|
|
|
Deferred income tax rate adjustments
|
—
|
|
22.1
|
|
13.5
|
|
4.8
|
|
|
Other
|
(0.3
|
)
|
2.9
|
|
3.2
|
|
2.0
|
|
|
|
(33.9
|
)
|
61.7
|
|
48.2
|
|
49.5
|
|
8
|
EARNINGS PER COMMON SHARE
|
|
|
13 Weeks Ended
|
|
39 Weeks Ended
|
|
||||
|
(Thousands of Dollars and Shares, Except Per Share Data)
|
June 29
2014 |
|
June 30
2013 |
|
June 29
2014 |
|
June 30
2013 |
|
|
|
|
|
|
|
||||
|
Income (loss) attributable to Lee Enterprises, Incorporated:
|
|
|
|
|
||||
|
Continuing operations
|
(9,746
|
)
|
1,795
|
|
3,632
|
|
11,619
|
|
|
Discontinued operations
|
—
|
|
—
|
|
—
|
|
(1,247
|
)
|
|
|
(9,746
|
)
|
1,795
|
|
3,632
|
|
10,372
|
|
|
Weighted average common shares
|
53,627
|
|
52,325
|
|
53,342
|
|
52,305
|
|
|
Less weighted average restricted Common Stock
|
1,283
|
|
500
|
|
1,126
|
|
500
|
|
|
Basic average common shares
|
52,344
|
|
51,825
|
|
52,216
|
|
51,805
|
|
|
Dilutive stock options, Warrants and restricted Common Stock
|
—
|
|
213
|
|
1,439
|
|
107
|
|
|
Diluted average common shares
|
52,344
|
|
52,038
|
|
53,655
|
|
51,912
|
|
|
Earnings (loss) per common share:
|
|
|
|
|
||||
|
Basic:
|
|
|
|
|
||||
|
Continuing operations
|
(0.19
|
)
|
0.03
|
|
0.07
|
|
0.22
|
|
|
Discontinued operations
|
—
|
|
—
|
|
—
|
|
(0.02
|
)
|
|
|
(0.19
|
)
|
0.03
|
|
0.07
|
|
0.20
|
|
|
Diluted:
|
|
|
|
|
||||
|
Continuing operations
|
(0.19
|
)
|
0.03
|
|
0.07
|
|
0.22
|
|
|
Discontinued operations
|
—
|
|
—
|
|
—
|
|
(0.02
|
)
|
|
|
(0.19
|
)
|
0.03
|
|
0.07
|
|
0.20
|
|
9
|
STOCK OWNERSHIP PLANS
|
|
(Thousands of Dollars and Shares, Except Per Share Data)
|
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Term
(Years)
|
Aggregate
Intrinsic
Value
|
|
|
|
|
|
|
|
|||
|
Outstanding, September 29, 2013
|
2,769
|
|
2.94
|
|
|
|
|
|
Granted
|
15
|
|
2.99
|
|
|
|
|
|
Exercised
|
(300
|
)
|
2.04
|
|
|
|
|
|
Cancelled
|
(97
|
)
|
11.88
|
|
|
|
|
|
Outstanding, June 29, 2014
|
2,387
|
|
2.69
|
|
6.8
|
6,120
|
|
|
|
|
|
|
|
|||
|
Exercisable, June 29, 2014
|
1,796
|
|
3.17
|
|
6.4
|
4,260
|
|
|
(Thousands of Shares, Except Per Share Data)
|
Shares
|
|
Weighted
Average
Grant Date
Fair Value
|
|
|
|
|
|
||
|
Outstanding, September 29, 2013
|
500
|
|
1.31
|
|
|
Granted
|
801
|
|
3.61
|
|
|
Cancelled
|
(21
|
)
|
3.61
|
|
|
Outstanding, June 29, 2014
|
1,280
|
|
2.71
|
|
10
|
FAIR VALUE MEASUREMENTS
|
11
|
COMMITMENTS AND CONTINGENT LIABILITIES
|
12
|
COMMON STOCK
|
•
|
50 daily and 38 Sunday newspapers with subscribers totaling
1.2 million
and
1.5 million
, respectively, read by nearly four million people in print;
|
•
|
Websites, mobile and tablet products in all of our markets that complement our newspapers and attracted
23.1 million
unique visitors in June 29, 2014, with
211.4 million
page views; and
|
•
|
Nearly 300 weekly newspapers and classified and niche publications.
|
|
13 Weeks Ended
|
|
||||
(Thousands of Dollars, Except Per Share Data)
|
June 29
2014 |
|
June 30
2013 |
|
Percent
Change
|
|
|
|
|
|
|||
Advertising and marketing services revenue:
|
|
|
|
|||
Retail
|
69,507
|
|
71,718
|
|
(3.1
|
)
|
Classified:
|
|
|
|
|||
Employment
|
9,277
|
|
8,824
|
|
5.1
|
|
Automotive
|
7,266
|
|
8,452
|
|
(14.0
|
)
|
Real estate
|
4,569
|
|
4,864
|
|
(6.1
|
)
|
All other
|
11,926
|
|
12,491
|
|
(4.5
|
)
|
Total classified
|
33,038
|
|
34,631
|
|
(4.6
|
)
|
National
|
5,268
|
|
4,988
|
|
5.6
|
|
Niche publications and other
|
2,471
|
|
2,607
|
|
(5.2
|
)
|
Total advertising and marketing services revenue
|
110,284
|
|
113,944
|
|
(3.2
|
)
|
Subscription
|
43,339
|
|
43,583
|
|
(0.6
|
)
|
Commercial printing
|
3,147
|
|
3,258
|
|
(3.4
|
)
|
Digital services and other
|
6,355
|
|
6,234
|
|
1.9
|
|
Total operating revenue
|
163,125
|
|
167,019
|
|
(2.3
|
)
|
Operating expenses:
|
|
|
|
|||
Compensation
|
60,330
|
|
62,340
|
|
(3.2
|
)
|
Newsprint and ink
|
9,224
|
|
10,471
|
|
(11.9
|
)
|
Other operating expenses
|
53,840
|
|
53,461
|
|
0.7
|
|
Workforce adjustments
|
419
|
|
945
|
|
(55.7
|
)
|
Cash costs
|
123,813
|
|
127,217
|
|
(2.7
|
)
|
Operating cash flow
|
39,312
|
|
39,802
|
|
(1.2
|
)
|
Depreciation and amortization
|
12,194
|
|
14,869
|
|
(18.0
|
)
|
Loss (gain) on sales of assets, net
|
9
|
|
(112
|
)
|
NM
|
|
Impairment of goodwill and other assets
|
336
|
|
—
|
|
NM
|
|
Equity in earnings of associated companies
|
1,836
|
|
1,893
|
|
(3.0
|
)
|
Operating income
|
28,609
|
|
26,938
|
|
6.2
|
|
Non-operating expense, net
|
(43,002
|
)
|
(21,805
|
)
|
97.2
|
|
Income (loss) before income taxes
|
(14,393
|
)
|
5,133
|
|
NM
|
|
Income tax expense (benefit)
|
(4,882
|
)
|
3,165
|
|
NM
|
|
Net income (loss)
|
(9,511
|
)
|
1,968
|
|
NM
|
|
Net income attributable to non-controlling interests
|
(235
|
)
|
(173
|
)
|
35.8
|
|
Income (loss) attributable to Lee Enterprises, Incorporated
|
(9,746
|
)
|
1,795
|
|
NM
|
|
Other comprehensive loss, net of income taxes
|
(441
|
)
|
(93
|
)
|
NM
|
|
Comprehensive income (loss) attributable to Lee Enterprises, Incorporated
|
(10,187
|
)
|
1,702
|
|
NM
|
|
Earnings (loss) per common share:
|
|
|
|
|||
Basic
|
(0.19
|
)
|
0.03
|
|
NM
|
|
Diluted
|
(0.19
|
)
|
0.03
|
|
NM
|
|
|
13 Weeks Ended
|
|
||||
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
Percent Change
|
|
|
|
|
|
|||
Subscription revenue, as reported
|
43,339
|
|
43,583
|
|
(0.6
|
)
|
Adjustment for subscription-related expense reclassification
|
(1,842
|
)
|
—
|
|
NM
|
|
Subscription revenue, as adjusted
|
41,497
|
|
43,583
|
|
(4.8
|
)
|
|
|
|
|
|||
Total operating revenue, as reported
|
163,125
|
|
167,019
|
|
(2.3
|
)
|
Adjustment for subscription-related expense reclassification
|
(1,842
|
)
|
—
|
|
NM
|
|
Total operating revenue, as adjusted
|
161,283
|
|
167,019
|
|
(3.4
|
)
|
|
|
|
|
|||
Total cash costs, as reported
|
123,813
|
|
127,217
|
|
(2.7
|
)
|
Adjustment for subscription-related expense reclassification
|
(1,842
|
)
|
—
|
|
NM
|
|
Total cash costs, as adjusted
|
121,971
|
|
127,217
|
|
(4.1
|
)
|
|
13 Weeks Ended
|
|
||||||
|
June 29
2014 |
|
June 30
2013 |
|
||||
(Thousands of Dollars, Except Per Share Data)
|
Amount
|
|
Per Share
|
|
Amount
|
|
Per Share
|
|
|
|
|
|
|
||||
Income (loss) attributable to Lee Enterprises, Incorporated, as reported
|
(9,746
|
)
|
(0.19
|
)
|
1,795
|
|
0.03
|
|
Adjustments:
|
|
|
|
|
||||
Impairment of intangible and other assets
|
336
|
|
|
—
|
|
|
||
Litigation settlement
|
2,300
|
|
|
—
|
|
|
||
Debt financing and reorganization costs
|
21,732
|
|
|
468
|
|
|
||
Amortization of debt present value adjustment
|
—
|
|
|
1,216
|
|
|
||
Other, net
|
(153
|
)
|
|
544
|
|
|
||
|
24,215
|
|
|
2,228
|
|
|
||
Income tax effect of adjustments, net
|
(8,472
|
)
|
|
(763
|
)
|
|
||
|
15,743
|
|
0.30
|
|
1,465
|
|
0.03
|
|
Income (loss) attributable to Lee Enterprises, Incorporated, as adjusted
|
5,997
|
|
0.11
|
|
3,260
|
|
0.06
|
|
|
39 Weeks Ended
|
|
||||
(Thousands of Dollars, Except Per Share Data)
|
June 29
2014 |
|
June 30
2013 |
|
Percent
Change
|
|
|
|
|
|
|||
Operating revenue:
|
|
|
|
|||
Retail
|
216,591
|
|
223,438
|
|
(3.1
|
)
|
Classified:
|
|
|
|
|||
Employment
|
24,546
|
|
25,165
|
|
(2.5
|
)
|
Automotive
|
22,309
|
|
26,074
|
|
(14.4
|
)
|
Real estate
|
13,113
|
|
13,941
|
|
(5.9
|
)
|
All other
|
32,683
|
|
35,634
|
|
(8.3
|
)
|
Total classified
|
92,651
|
|
100,814
|
|
(8.1
|
)
|
National
|
18,879
|
|
18,327
|
|
3.0
|
|
Niche publications and other
|
7,273
|
|
7,646
|
|
(4.9
|
)
|
Total advertising and marketing services revenue
|
335,394
|
|
350,225
|
|
(4.2
|
)
|
Subscription
|
130,744
|
|
133,609
|
|
(2.1
|
)
|
Commercial printing
|
9,170
|
|
9,681
|
|
(5.3
|
)
|
Digital services and other
|
19,295
|
|
18,762
|
|
2.8
|
|
Total operating revenue
|
494,603
|
|
512,277
|
|
(3.5
|
)
|
Operating expenses:
|
|
|
|
|||
Compensation
|
181,543
|
|
192,505
|
|
(5.7
|
)
|
Newsprint and ink
|
29,120
|
|
33,357
|
|
(12.7
|
)
|
Other operating expenses
|
161,708
|
|
160,929
|
|
0.5
|
|
Workforce adjustments
|
925
|
|
2,260
|
|
(59.1
|
)
|
Cash costs
|
373,296
|
|
389,051
|
|
(4.0
|
)
|
Operating cash flow
|
121,307
|
|
123,226
|
|
(1.6
|
)
|
Depreciation and amortization
|
36,410
|
|
44,758
|
|
(18.7
|
)
|
Loss (gain) on sales of assets, net
|
(1,622
|
)
|
23
|
|
NM
|
|
Impairment of goodwill and other assets
|
336
|
|
—
|
|
NM
|
|
Equity in earnings of associated companies
|
6,348
|
|
6,671
|
|
(4.8
|
)
|
Operating income
|
92,531
|
|
85,116
|
|
8.7
|
|
Non-operating expense, net
|
(84,241
|
)
|
(61,262
|
)
|
37.5
|
|
Income from continuing operations before income taxes
|
8,290
|
|
23,854
|
|
(65.2
|
)
|
Income tax expense
|
3,995
|
|
11,805
|
|
(66.2
|
)
|
Income from continuing operations
|
4,295
|
|
12,049
|
|
(64.4
|
)
|
Discontinued operations, net of income taxes
|
—
|
|
(1,247
|
)
|
NM
|
|
Net income
|
4,295
|
|
10,802
|
|
(60.2
|
)
|
Net income attributable to non-controlling interests
|
(663
|
)
|
(430
|
)
|
54.2
|
|
Income attributable to Lee Enterprises, Incorporated
|
3,632
|
|
10,372
|
|
(65.0
|
)
|
Other comprehensive loss, net of income taxes
|
(1,324
|
)
|
(280
|
)
|
NM
|
|
Comprehensive income attributable to Lee Enterprises, Incorporated
|
2,308
|
|
10,092
|
|
(77.1
|
)
|
|
|
|
|
|||
Income from continuing operations attributable to Lee Enterprises, Incorporated
|
3,632
|
|
11,619
|
|
(68.7
|
)
|
|
|
|
|
|||
Earnings per common share:
|
|
|
|
|||
Basic
|
0.07
|
|
0.20
|
|
(65.0
|
)
|
Diluted
|
0.07
|
|
0.20
|
|
(65.0
|
)
|
|
39 Weeks Ended
|
|
||||
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
Percent Change
|
|
|
|
|
|
|||
Subscription revenue, as reported
|
130,744
|
|
133,609
|
|
(2.1
|
)
|
Adjustment for subscription-related expense reclassification
|
(2,242
|
)
|
—
|
|
NM
|
|
Subscription revenue, as adjusted
|
128,502
|
|
133,609
|
|
(3.8
|
)
|
|
|
|
|
|||
Total operating revenue, as reported
|
494,603
|
|
512,277
|
|
(3.5
|
)
|
Adjustment for subscription-related expense reclassification
|
(2,242
|
)
|
—
|
|
NM
|
|
Total operating revenue, as adjusted
|
492,361
|
|
512,277
|
|
(3.9
|
)
|
|
|
|
|
|||
Total cash costs, as reported
|
373,296
|
|
389,051
|
|
(4.0
|
)
|
Adjustment for subscription-related expense reclassification
|
(2,242
|
)
|
—
|
|
NM
|
|
Total cash costs, as adjusted
|
371,054
|
|
389,051
|
|
(4.6
|
)
|
|
|
|
39 Weeks Ended
|
|
||||
|
June 29
2014 |
|
June 30
2013 |
|
||||
(Thousands of Dollars, Except Per Share Data)
|
Amount
|
|
Per Share
|
|
Amount
|
|
Per Share
|
|
|
|
|
||||||
Income attributable to Lee Enterprises, Incorporated, as reported
|
3,632
|
|
0.07
|
|
10,372
|
|
0.20
|
|
Adjustments:
|
|
|
|
|
||||
Impairment of intangible and other assets
|
336
|
|
|
—
|
|
|
||
Gain on sale of investment, net
|
—
|
|
|
(6,909
|
)
|
|
||
Litigation settlement
|
2,300
|
|
|
—
|
|
|
||
Debt financing and reorganization costs
|
21,935
|
|
|
557
|
|
|
||
Amortization of debt present value adjustment
|
2,394
|
|
|
3,932
|
|
|
||
Other, net
|
424
|
|
|
2,170
|
|
|
||
|
27,389
|
|
|
(250
|
)
|
|
||
Income tax effect of adjustments, net
|
(9,551
|
)
|
|
102
|
|
|
||
|
17,838
|
|
0.33
|
|
(148
|
)
|
—
|
|
Unusual matters related to discontinued operations
|
—
|
|
—
|
|
1,014
|
|
0.02
|
|
Income attributable to Lee Enterprises, Incorporated, as adjusted
|
21,470
|
|
0.40
|
|
11,238
|
|
0.22
|
|
|
13 Weeks Ended
|
|
|
39 Weeks Ended
|
|
|
52 Weeks Ended
|
|
||||
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
|
June 29
2014 |
|
June 30
2013 |
|
|
June 29
2014 |
|
|
|
|
|
|
|
|
|
|||||
Advertising and marketing services
|
110,284
|
|
113,944
|
|
|
335,394
|
|
350,225
|
|
|
445,709
|
|
Subscription
|
43,339
|
|
43,583
|
|
|
130,744
|
|
133,609
|
|
|
174,192
|
|
Other
|
9,502
|
|
9,492
|
|
|
28,465
|
|
28,443
|
|
|
37,165
|
|
Total operating revenue
|
163,125
|
|
167,019
|
|
|
494,603
|
|
512,277
|
|
|
657,066
|
|
Compensation
|
60,330
|
|
62,340
|
|
|
181,543
|
|
192,505
|
|
|
243,870
|
|
Newsprint and ink
|
9,224
|
|
10,471
|
|
|
29,120
|
|
33,357
|
|
|
39,244
|
|
Other operating expenses
|
53,840
|
|
53,461
|
|
|
161,708
|
|
160,929
|
|
|
213,800
|
|
Depreciation and amortization
|
12,194
|
|
14,869
|
|
|
36,410
|
|
44,758
|
|
|
47,180
|
|
Loss (gain) on sales of assets, net
|
9
|
|
(112
|
)
|
|
(1,622
|
)
|
23
|
|
|
(1,535
|
)
|
Impairment of goodwill and other assets
|
336
|
|
—
|
|
|
336
|
|
—
|
|
|
171,430
|
|
Workforce adjustments
|
419
|
|
945
|
|
|
925
|
|
2,260
|
|
|
1,344
|
|
Total operating expenses
|
136,352
|
|
141,974
|
|
|
408,420
|
|
433,832
|
|
|
715,333
|
|
Equity in earnings of TNI and MNI
|
1,836
|
|
1,893
|
|
|
6,348
|
|
6,671
|
|
|
8,362
|
|
Operating income (loss)
|
28,609
|
|
26,938
|
|
|
92,531
|
|
85,116
|
|
|
(49,905
|
)
|
Adjusted to exclude:
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization
|
12,194
|
|
14,869
|
|
|
36,410
|
|
44,758
|
|
|
47,180
|
|
Loss (gain) on sale of assets, net
|
9
|
|
(112
|
)
|
|
(1,622
|
)
|
23
|
|
|
(1,535
|
)
|
Impairment of intangible and other assets
|
336
|
|
—
|
|
|
336
|
|
—
|
|
|
171,430
|
|
Equity in earnings of TNI and MNI
|
(1,836
|
)
|
(1,893
|
)
|
|
(6,348
|
)
|
(6,671
|
)
|
|
(8,362
|
)
|
Operating cash flow
|
39,312
|
|
39,802
|
|
|
121,307
|
|
123,226
|
|
|
158,808
|
|
Add:
|
|
|
|
|
|
|
|
|||||
Ownership share of TNI and MNI EBITDA (50%)
|
2,587
|
|
2,770
|
|
|
8,540
|
|
9,310
|
|
|
11,009
|
|
Adjusted to exclude:
|
|
|
|
|
|
|
|
|||||
Stock compensation
|
397
|
|
377
|
|
|
1,081
|
|
1,109
|
|
|
1,233
|
|
Adjusted EBITDA
|
42,296
|
|
42,949
|
|
|
130,928
|
|
133,645
|
|
|
171,050
|
|
Adjusted to exclude:
|
|
|
|
|
|
|
|
|||||
Ownership share of TNI and MNI EBITDA (50%)
|
(2,587
|
)
|
(2,770
|
)
|
|
(8,540
|
)
|
(9,310
|
)
|
|
(11,009
|
)
|
Add (deduct):
|
|
|
|
|
|
|
|
|||||
Distributions from TNI and MNI
|
2,346
|
|
3,394
|
|
|
7,654
|
|
8,179
|
|
|
10,873
|
|
Capital expenditures
|
(3,309
|
)
|
(2,136
|
)
|
|
(8,204
|
)
|
(6,835
|
)
|
|
(11,109
|
)
|
Pension contributions
|
(17
|
)
|
(5,741
|
)
|
|
(722
|
)
|
(6,016
|
)
|
|
(722
|
)
|
Cash income tax refunds (payments)
|
6,051
|
|
(27
|
)
|
|
5,933
|
|
(360
|
)
|
|
15,419
|
|
Unlevered free cash flow
|
44,780
|
|
35,669
|
|
|
127,049
|
|
119,303
|
|
|
174,502
|
|
Add (deduct):
|
|
|
|
|
|
|
|
|||||
Financial income
|
85
|
|
134
|
|
|
306
|
|
219
|
|
|
387
|
|
Interest expense settled in cash
|
(19,654
|
)
|
(20,775
|
)
|
|
(58,639
|
)
|
(64,141
|
)
|
|
(78,510
|
)
|
Debt financing costs paid
|
(31,008
|
)
|
(666
|
)
|
|
(31,276
|
)
|
(766
|
)
|
|
(31,581
|
)
|
Free cash flow (deficit)
|
(5,797
|
)
|
14,362
|
|
|
37,440
|
|
54,615
|
|
|
64,798
|
|
|
13 Weeks Ended
|
|
|
39 Weeks Ended
|
|
|
52 Weeks Ended
|
|
||||
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
|
June 29
2014 |
|
June 30
2013 |
|
|
June 29
2014 |
|
|
|
|
|
|
|
|
|
|||||
Advertising and marketing services
|
76,148
|
|
78,266
|
|
|
231,411
|
|
240,241
|
|
|
308,331
|
|
Subscription
|
28,022
|
|
27,092
|
|
|
83,499
|
|
83,028
|
|
|
110,807
|
|
Other
|
8,330
|
|
7,774
|
|
|
24,959
|
|
23,446
|
|
|
32,591
|
|
Total operating revenue
|
112,500
|
|
113,132
|
|
|
339,869
|
|
346,715
|
|
|
451,729
|
|
Compensation
|
45,086
|
|
45,457
|
|
|
135,035
|
|
139,412
|
|
|
181,094
|
|
Newsprint and ink
|
6,550
|
|
7,224
|
|
|
20,623
|
|
22,992
|
|
|
27,826
|
|
Other operating expenses
|
28,954
|
|
27,741
|
|
|
86,706
|
|
85,605
|
|
|
113,869
|
|
Depreciation and amortization
|
8,322
|
|
6,837
|
|
|
24,633
|
|
20,569
|
|
|
31,314
|
|
Loss (gain) on sale of assets, net
|
8
|
|
(98
|
)
|
|
(1,643
|
)
|
52
|
|
|
(1,561
|
)
|
Impairment of goodwill and other assets
|
336
|
|
—
|
|
|
336
|
|
—
|
|
|
859
|
|
Workforce adjustments
|
265
|
|
572
|
|
|
436
|
|
1,185
|
|
|
796
|
|
Total operating expenses
|
89,521
|
|
87,733
|
|
|
266,126
|
|
269,815
|
|
|
354,197
|
|
Equity in earnings of MNI
|
790
|
|
877
|
|
|
2,232
|
|
2,658
|
|
|
3,084
|
|
Operating income
|
23,769
|
|
26,276
|
|
|
75,975
|
|
79,558
|
|
|
100,616
|
|
Adjusted to exclude:
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization
|
8,322
|
|
6,837
|
|
|
24,633
|
|
20,569
|
|
|
31,314
|
|
Loss (gain) on sales of assets, net
|
8
|
|
(98
|
)
|
|
(1,643
|
)
|
52
|
|
|
(1,561
|
)
|
Impairment of intangible and other assets
|
336
|
|
—
|
|
|
336
|
|
—
|
|
|
859
|
|
Equity in earnings of MNI
|
(790
|
)
|
(877
|
)
|
|
(2,232
|
)
|
(2,658
|
)
|
|
(3,084
|
)
|
Operating cash flow
|
31,645
|
|
32,138
|
|
|
97,069
|
|
97,521
|
|
|
128,144
|
|
Add:
|
|
|
|
|
|
|
|
|||||
Ownership share of MNI EBITDA (50%)
|
1,436
|
|
1,598
|
|
|
4,110
|
|
4,781
|
|
|
5,311
|
|
Adjusted to exclude:
|
|
|
|
|
|
|
|
|||||
Stock compensation
|
397
|
|
377
|
|
|
1,081
|
|
1,109
|
|
|
1,233
|
|
Adjusted EBITDA
|
33,478
|
|
34,113
|
|
|
102,260
|
|
103,411
|
|
|
134,688
|
|
Adjusted to exclude:
|
|
|
|
|
|
|
|
|||||
Ownership share of MNI EBITDA (50%)
|
(1,436
|
)
|
(1,598
|
)
|
|
(4,110
|
)
|
(4,781
|
)
|
|
(5,311
|
)
|
Add (deduct):
|
|
|
|
|
|
|
|
|||||
Distributions from MNI
|
1,000
|
|
1,850
|
|
|
3,750
|
|
4,000
|
|
|
5,000
|
|
Capital expenditures
|
(2,900
|
)
|
(1,685
|
)
|
|
(7,145
|
)
|
(5,127
|
)
|
|
(9,731
|
)
|
Pension contributions
|
(17
|
)
|
—
|
|
|
(17
|
)
|
—
|
|
|
(17
|
)
|
Cash income tax refunds (payments)
|
(199
|
)
|
(27
|
)
|
|
(317
|
)
|
(360
|
)
|
|
(322
|
)
|
Intercompany charges not settled in cash
|
(2,099
|
)
|
(2,146
|
)
|
|
(6,297
|
)
|
(6,438
|
)
|
|
(8,255
|
)
|
Other
|
(2,000
|
)
|
—
|
|
|
(2,000
|
)
|
(2,000
|
)
|
|
(2,000
|
)
|
Unlevered free cash flow
|
25,827
|
|
30,507
|
|
|
86,124
|
|
88,705
|
|
|
114,052
|
|
Add (deduct):
|
|
|
|
|
|
|
|
|||||
Financial income
|
85
|
|
134
|
|
|
306
|
|
219
|
|
|
387
|
|
Interest expense settled in cash
|
(18,834
|
)
|
(18,619
|
)
|
|
(55,397
|
)
|
(56,454
|
)
|
|
(73,584
|
)
|
Debt financing costs paid
|
(31,000
|
)
|
—
|
|
|
(31,268
|
)
|
(100
|
)
|
|
(31,308
|
)
|
Free cash flow (deficit)
|
(23,922
|
)
|
12,022
|
|
|
(235
|
)
|
32,370
|
|
|
9,547
|
|
|
13 Weeks Ended
|
|
|
39 Weeks Ended
|
|
|
52 Weeks Ended
|
|
||||
(Thousands of Dollars)
|
June 29
2014 |
|
June 30
2013 |
|
|
June 29
2014 |
|
June 30
2013 |
|
|
June 29
2014 |
|
|
|
|
|
|
|
|
|
|||||
Advertising and marketing services
|
34,136
|
|
35,678
|
|
|
103,983
|
|
109,984
|
|
|
137,378
|
|
Subscription
|
15,317
|
|
16,491
|
|
|
47,245
|
|
50,581
|
|
|
63,385
|
|
Other
|
1,172
|
|
1,718
|
|
|
3,506
|
|
4,997
|
|
|
4,574
|
|
Total operating revenue
|
50,625
|
|
53,887
|
|
|
154,734
|
|
165,562
|
|
|
205,337
|
|
Compensation
|
15,244
|
|
16,883
|
|
|
46,508
|
|
53,093
|
|
|
62,776
|
|
Newsprint and ink
|
2,674
|
|
3,247
|
|
|
8,497
|
|
10,365
|
|
|
11,418
|
|
Other operating expenses
|
24,886
|
|
25,720
|
|
|
75,002
|
|
75,324
|
|
|
99,931
|
|
Depreciation and amortization
|
3,872
|
|
8,032
|
|
|
11,777
|
|
24,189
|
|
|
15,866
|
|
Loss (gain) on sale of assets, net
|
1
|
|
(14
|
)
|
|
21
|
|
(29
|
)
|
|
26
|
|
Impairment of goodwill and other assets
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
170,571
|
|
Workforce adjustments
|
154
|
|
373
|
|
|
489
|
|
1,075
|
|
|
548
|
|
Total operating expenses
|
46,831
|
|
54,241
|
|
|
142,294
|
|
164,017
|
|
|
361,136
|
|
Equity in earnings of TNI
|
1,046
|
|
1,016
|
|
|
4,116
|
|
4,013
|
|
|
5,278
|
|
Operating income (loss)
|
4,840
|
|
662
|
|
|
16,556
|
|
5,558
|
|
|
(150,521
|
)
|
Adjusted to exclude:
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization
|
3,872
|
|
8,032
|
|
|
11,777
|
|
24,189
|
|
|
15,866
|
|
Loss (gain) on sales of assets, net
|
1
|
|
(14
|
)
|
|
21
|
|
(29
|
)
|
|
26
|
|
Impairment of intangible and other assets
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
170,571
|
|
Equity in earnings of TNI
|
(1,046
|
)
|
(1,016
|
)
|
|
(4,116
|
)
|
(4,013
|
)
|
|
(5,278
|
)
|
Operating cash flow
|
7,667
|
|
7,664
|
|
|
24,238
|
|
25,705
|
|
|
30,664
|
|
Add:
|
|
|
|
|
|
|
|
|||||
Ownership share of TNI EBITDA (50%)
|
1,151
|
|
1,172
|
|
|
4,430
|
|
4,529
|
|
|
5,698
|
|
Adjusted EBITDA
|
8,818
|
|
8,836
|
|
|
28,668
|
|
30,234
|
|
|
36,362
|
|
Adjusted to exclude:
|
|
|
|
|
|
|
|
|||||
Ownership share of TNI EBITDA (50%)
|
(1,151
|
)
|
(1,172
|
)
|
|
(4,430
|
)
|
(4,529
|
)
|
|
(5,698
|
)
|
Add (deduct):
|
|
|
|
|
|
|
|
|||||
Distributions from TNI
|
1,346
|
|
1,544
|
|
|
3,904
|
|
4,179
|
|
|
5,873
|
|
Capital expenditures
|
(409
|
)
|
(451
|
)
|
|
(1,059
|
)
|
(1,708
|
)
|
|
(1,378
|
)
|
Pension contributions
|
—
|
|
(5,741
|
)
|
|
(705
|
)
|
(6,016
|
)
|
|
(705
|
)
|
Cash income tax refunds (payments)
|
6,250
|
|
—
|
|
|
6,250
|
|
—
|
|
|
15,741
|
|
Intercompany charges not settled in cash
|
2,099
|
|
2,146
|
|
|
6,297
|
|
6,438
|
|
|
8,255
|
|
Other
|
2,000
|
|
—
|
|
|
2,000
|
|
2,000
|
|
|
2,000
|
|
Unlevered free cash flow
|
18,953
|
|
5,162
|
|
|
40,925
|
|
30,598
|
|
|
60,450
|
|
Deduct:
|
|
|
|
|
|
|
|
|||||
Interest expense settled in cash
|
(820
|
)
|
(2,156
|
)
|
|
(3,242
|
)
|
(7,687
|
)
|
|
(4,926
|
)
|
Debt financing costs paid
|
(8
|
)
|
(666
|
)
|
|
(8
|
)
|
(666
|
)
|
|
(273
|
)
|
Free cash flow
|
18,125
|
|
2,340
|
|
|
37,675
|
|
22,245
|
|
|
55,251
|
|
Number
|
|
Description
|
|
|
|
31.1
|
|
Rule 13a-14(a)/15d-14(a) certification
|
31.2
|
|
Rule 13a-14(a)/15d-14(a) certification
|
32
|
|
Section 1350 certification
|
|
|
|
LEE ENTERPRISES, INCORPORATED
|
|
|
|
|
|
/s/ Carl G. Schmidt
|
|
August 8, 2014
|
Carl G. Schmidt
|
|
|
Vice President, Chief Financial Officer and Treasurer
|
|
|
(Principal Financial and Accounting Officer)
|
|
|
1 Year Lee Enterprises Chart |
1 Month Lee Enterprises Chart |
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