Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | ||
Sep. 29, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | |
Common Class A | Common Class B | ||
Entity Registrant Name | 'MCCLATCHY CO | ' | ' |
Entity Central Index Key | '0001056087 | ' | ' |
Document Type | '10-Q | ' | ' |
Document Period End Date | 29-Sep-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-29 | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 61,538,608 | 24,800,962 |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'Q3 | ' | ' |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 |
REVENUES - NET: | ' | ' | ' | ' |
Advertising | $194,862 | $212,023 | $599,636 | $644,352 |
Circulation | 86,960 | 81,639 | 261,253 | 250,830 |
Other | 11,788 | 12,670 | 36,619 | 37,965 |
Revenues, total | 293,610 | 306,332 | 897,508 | 933,147 |
OPERATING EXPENSES: | ' | ' | ' | ' |
Compensation | 105,239 | 108,421 | 325,972 | 329,156 |
Newsprint, supplements and printing expenses | 28,908 | 33,058 | 90,462 | 102,365 |
Depreciation and amortization | 27,491 | 30,741 | 87,856 | 92,304 |
Other operating expenses | 104,401 | 101,633 | 313,588 | 305,933 |
Operating expenses, total | 266,039 | 273,853 | 817,878 | 829,758 |
OPERATING INCOME | 27,571 | 32,479 | 79,630 | 103,389 |
NON-OPERATING (EXPENSE) INCOME: | ' | ' | ' | ' |
Interest expense | -33,531 | -39,718 | -102,920 | -112,825 |
Interest income | 17 | 20 | 48 | 70 |
Equity income in unconsolidated companies, net | 13,979 | 11,728 | 35,108 | 27,080 |
Gain (loss) on extinguishment of debt, net | -873 | -12 | -13,643 | 6,074 |
Gain on sale of Miami property | 2,925 | ' | 12,938 | ' |
Other - net | 88 | 40 | 181 | 83 |
Non-operating (expense) income, total | -17,395 | -27,942 | -68,288 | -79,518 |
Income before income taxes | 10,176 | 4,537 | 11,342 | 23,871 |
Income tax provision (benefit) | 2,911 | -556 | 5,066 | -6,000 |
NET INCOME | $7,265 | $5,093 | $6,276 | $29,871 |
Net income per common share: | ' | ' | ' | ' |
Basic (in dollars per share) | $0.08 | $0.06 | $0.07 | $0.35 |
Diluted (in dollars per share) | $0.08 | $0.06 | $0.07 | $0.35 |
Weighted average number of common shares used to calculate basic and diluted earnings per share: | ' | ' | ' | ' |
Basic (in shares) | 86,291 | 85,840 | 86,154 | 85,691 |
Diluted (in shares) | 87,230 | 86,369 | 87,035 | 86,417 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 |
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) | ' | ' | ' | ' |
NET INCOME | $7,265 | $5,093 | $6,276 | $29,871 |
Pension and post retirement plans: | ' | ' | ' | ' |
Unamortized net loss and other components of benefit plans, net of taxes of $(2,258), $(1,100), $(6,773) and $(3,299) | 3,387 | 1,650 | 10,160 | 4,949 |
Investment in unconsolidated companies: | ' | ' | ' | ' |
Other comprehensive income (loss), net of taxes of $(43), $(140), $444 and $721 | 65 | 211 | -666 | -1,081 |
Other comprehensive income | 3,452 | 1,861 | 9,494 | 3,868 |
Comprehensive income | $10,717 | $6,954 | $15,770 | $33,739 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 |
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) | ' | ' | ' | ' |
Unamortized net loss and other components of benefit plans, taxes | ($2,258) | ($1,100) | ($6,773) | ($3,299) |
Other comprehensive loss, taxes | ($43) | ($140) | $444 | $721 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEET (USD $) | Sep. 29, 2013 | Dec. 30, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $45,431 | $113,088 |
Trade receivables (net of allowances of $5,614 and $5,920, respectively) | 131,585 | 177,225 |
Other receivables | 11,437 | 9,555 |
Newsprint, ink and other inventories | 25,329 | 30,145 |
Deferred income taxes | 14,406 | 14,406 |
Other current assets | 21,133 | 31,558 |
Total current assets | 249,321 | 375,977 |
Property, plant and equipment, net | 484,438 | 733,729 |
Intangible assets: | ' | ' |
Identifiable intangibles - net | 485,625 | 528,002 |
Goodwill | 1,012,914 | 1,012,011 |
Total intangible assets | 1,498,539 | 1,540,013 |
Investments and other assets: | ' | ' |
Investments in unconsolidated companies | 331,181 | 299,603 |
Other assets | 44,907 | 55,809 |
Total investments and other assets | 376,088 | 355,412 |
TOTAL ASSETS | 2,608,386 | 3,005,131 |
Current liabilities: | ' | ' |
Current portion of long-term debt | ' | 83,016 |
Accounts payable | 42,036 | 48,588 |
Accrued pension liabilities | 8,434 | 15,830 |
Accrued compensation | 42,427 | 39,124 |
Income taxes payable | ' | 2,327 |
Unearned revenue | 69,523 | 69,492 |
Accrued interest | 28,721 | 18,675 |
Other accrued liabilities | 17,284 | 14,273 |
Total current liabilities | 208,425 | 291,325 |
Non-current liabilities : | ' | ' |
Long-term debt | 1,520,728 | 1,587,330 |
Deferred income taxes | 27,196 | 39,719 |
Pension and postretirement obligations | 696,067 | 712,584 |
Financing obligations | 40,743 | 279,325 |
Other long-term obligations | 54,968 | 52,347 |
Total non-current liabilities | 2,339,702 | 2,671,305 |
Commitments and contingencies | ' | ' |
Stockholders' equity: | ' | ' |
Additional paid-in capital | 2,222,880 | 2,219,163 |
Accumulated deficit | -1,689,900 | -1,696,176 |
Treasury stock at cost, 569,258 shares in 2013 and 6,034 shares in 2012 | -1,768 | -29 |
Accumulated other comprehensive loss | -471,822 | -481,316 |
Total stockholders' equity | 60,259 | 42,501 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 2,608,386 | 3,005,131 |
Common Class A | ' | ' |
Stockholders' equity: | ' | ' |
Common stock | 621 | 611 |
Common Class B | ' | ' |
Stockholders' equity: | ' | ' |
Common stock | $248 | $248 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEET (Parenthetical) (USD $) | Sep. 29, 2013 | Dec. 30, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Trade receivables, allowance | $5,614 | $5,920 |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Treasury stock, shares | 569,258 | 6,034 |
Common Class A | ' | ' |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 62,106,570 | 61,098,820 |
Common Class B | ' | ' |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 24,800,962 | 24,800,962 |
CONDENSED_CONSOLIDATED_STATEME3
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ' | ' |
Net Income | $6,276 | $29,871 |
Reconciliation to net cash from continuing operations: | ' | ' |
Depreciation and amortization | 87,856 | 92,304 |
Contributions to qualified defined benefit pension plan | -7,500 | -40,000 |
Retirement benefit expense | 9,122 | 1,312 |
Stock-based compensation expense | 2,834 | 2,734 |
Equity income in unconsolidated companies | -35,108 | -27,080 |
(Gain) loss on extinguishment of debt | 13,643 | -6,074 |
Gain on disposal of Miami property | -12,938 | ' |
Net (gain) loss on disposal of equipment | 1,462 | -395 |
Other | -3,212 | 1,069 |
Changes in certain assets and liabilities: | ' | ' |
Trade receivables | 45,640 | 37,720 |
Inventories | 4,816 | -3,449 |
Other assets | 3,797 | -2,591 |
Accounts payable | -6,552 | 5,417 |
Accrued compensation | 3,307 | -2,673 |
Income taxes | -17,225 | -56,598 |
Accrued interest | 10,046 | -32,285 |
Other liabilities | 8,355 | 5,980 |
Net cash provided by operating activities | 114,619 | 5,262 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ' | ' |
Purchases of property, plant and equipment | -26,520 | -18,979 |
Proceeds from sale of property, plant and equipment and other | 1,656 | 1,361 |
Purchase of certificate of deposits | ' | -2,222 |
Proceed from redemption of certificates of deposit | 2,210 | ' |
Distribution of equity investments | 3,780 | 2,700 |
Proceeds from return of insurance-related deposit | 6,400 | ' |
Equity investments and other | -2,819 | -2,000 |
Net cash used in investing activities | -15,293 | -19,140 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' |
Repurchase of public notes and related expenses | -165,549 | -59,243 |
Proceeds from financing obligation related to Miami transaction | ' | 6,000 |
Other | -1,434 | -3,150 |
Net cash used in financing activities | -166,983 | -56,393 |
Decrease in cash and cash equivalents | -67,657 | -70,271 |
Cash and cash equivalents at beginning of period | 113,088 | 86,020 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $45,431 | $15,749 |
SIGNIFICANT_ACCOUNTING_POLICIE
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended | |||||||||||||
Sep. 29, 2013 | ||||||||||||||
SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||||
SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||||
1. SIGNIFICANT ACCOUNTING POLICIES | ||||||||||||||
Business and Basis of Accounting | ||||||||||||||
The McClatchy Company (the “Company,” “we,” “us” or “our”) is a leading news, advertising and information provider, offering a wide array of print and digital products in each of the markets it serves. As the third largest newspaper company in the United States, based on daily circulation, our operations include 30 daily newspapers, community newspapers, websites, mobile news and advertising, niche publications, direct marketing and direct mail services. Our largest newspapers include the (Fort Worth) Star-Telegram, The Sacramento Bee, The Kansas City Star, the Miami Herald, The Charlotte Observer and The (Raleigh) News & Observer. We are listed on the New York Stock Exchange under the symbol MNI. | ||||||||||||||
We also own a portfolio of premium digital assets, including 15.0% of CareerBuilder LLC, which operates the nation’s largest online jobs website, CareerBuilder.com; 25.6% of Classified Ventures LLC, a company that offers classified websites such as the auto website Cars.com and the rental website Apartments.com; 33.3% of HomeFinder LLC, which operates the online real estate website HomeFinder.com; and 12.2% of Wanderful Media, owner of Find & Save®, a digital shopping portal that provides advertisers with a common platform to reach online audiences with digital circulars, coupons and display advertising. | ||||||||||||||
The condensed consolidated financial statements include the Company and our subsidiaries. Intercompany items and transactions are eliminated. Preparation of the financial statements in conformity with accounting principles generally accepted in the United States and pursuant to the rules and regulation of the Securities and Exchange Commission requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. | ||||||||||||||
In our opinion, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly our financial position, results of operations, and cash flows for the interim periods presented. The financial statements contained in this report are not necessarily indicative of the results to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K and Amendment No. 1 to the Form 10-K for the year ended December 30, 2012 (collectively “Form 10-K”). The fiscal periods included herein comprise 13 weeks and 39 weeks for the third-quarter and nine-month periods, respectively. | ||||||||||||||
Outsourcing Agreement | ||||||||||||||
In October 2013, we entered into an outsourcing agreement to print one of our newspapers beginning in late February 2014. As a result, we expect to incur non-cash charges, including accelerated depreciation and other charges related to our existing facilities and production equipment of up to $15 million in the fourth quarter of 2013. We do not anticipate any material cash expenses during the fourth quarter of 2013 related to this agreement. | ||||||||||||||
Circulation Delivery Contract Accounting Correction | ||||||||||||||
Subsequent to the issuance of our consolidated financial statements on March 6, 2013, we determined that circulation revenues associated with our “fee for service” contracts with distributors and carriers should be presented on a gross basis, as opposed to on a net basis, as we are established as the primary obligor through subscriber agreements. The difference in presentation results in delivery costs associated with these contracts being reported as other operating expenses, rather than as a reduction in circulation revenues, in our condensed consolidated statements of operations. This correction resulted in an increase to circulation revenues and equivalent increases to other operating expenses of $18.9 million and $58.1 million in the quarter and nine months ended September 23, 2012, respectively. We believe this correction is not material to our previously issued financial statements for prior periods. There is no impact to the previously reported operating income, net income, net income per common share or cash flows from operating activities in any of the periods presented. | ||||||||||||||
Fair Value of Financial Instruments | ||||||||||||||
We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are: | ||||||||||||||
Level 1 – Unadjusted quoted prices available in active markets for identical investments as of the reporting date. | ||||||||||||||
Level 2 – Observable inputs to the valuation methodology are other than Level 1 inputs and are either directly or indirectly observable as of the reporting date and fair value can be determined through the use of models or other valuation methodologies. | ||||||||||||||
Level 3 – Inputs to the valuation methodology are unobservable inputs in situations where there is little or no market activity for the asset or liability, and the reporting entity makes estimates and assumptions related to the pricing of the asset or liability including assumptions regarding risk. | ||||||||||||||
Our policy is to recognize significant transfers between levels at the actual date of the event or circumstance that caused the transfer. The following methods and assumptions were used to estimate the fair value of each class of financial instruments: | ||||||||||||||
Cash and cash equivalents, accounts receivable and accounts payable. The carrying amount of these items approximates fair value. | ||||||||||||||
Long-term debt. The fair value of long-term debt is determined using quoted market prices and other inputs that were derived from available market information including the current market activity of our publicly-traded notes and bank debt, trends in investor demand and market values of comparable publicly-traded debt. These are considered to be Level 2 inputs under the fair value measurements and disclosure guidance, and may not be representative of actual value. At September 29, 2013, the estimated fair value and carrying value of long-term debt was $1.5 billion. | ||||||||||||||
Intangible Assets and Goodwill | ||||||||||||||
Intangible assets (primarily advertiser lists, subscriber lists and developed technology) and goodwill consisted of the following: | ||||||||||||||
December 30, | Acquired | Amortization | September 29, | |||||||||||
(in thousands) | 2012 | Assets | Expense | 2013 | ||||||||||
Intangible assets subject to amortization | $ | 834,961 | $ | 500 | — | $ | 835,461 | |||||||
Accumulated amortization | -510,546 | — | $ | -42,877 | -553,423 | |||||||||
324,415 | 500 | -42,877 | 282,038 | |||||||||||
Mastheads | 203,587 | — | N/A | 203,587 | ||||||||||
Goodwill | 1,012,011 | 903 | N/A | 1,012,914 | ||||||||||
Total | $ | 1,540,013 | $ | 1,403 | $ | -42,877 | $ | 1,498,539 | ||||||
During the nine months ended September 29, 2013, we completed a small acquisition, which is reflected in goodwill and intangible assets subject to amortization. | ||||||||||||||
Amortization expense with respect to intangible assets is summarized below: | ||||||||||||||
Quarter Ended | Nine Months Ended | |||||||||||||
September 29, | September 23, | September 29, | September 23, | |||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Amortization expense | $ | 14,375 | $ | 14,251 | $ | 42,877 | $ | 42,811 | ||||||
The estimated amortization expense for the remainder of fiscal year 2013 and the five succeeding fiscal years is as follows: | ||||||||||||||
Amortization | ||||||||||||||
Expense | ||||||||||||||
Year | (in thousands) | |||||||||||||
2013 (remainder) | $ | 14,304 | ||||||||||||
2014 | 52,757 | |||||||||||||
2015 | 48,086 | |||||||||||||
2016 | 47,721 | |||||||||||||
2017 | 48,552 | |||||||||||||
2018 | 46,977 | |||||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||||
Our accumulated other comprehensive loss (“AOCL”) and reclassifications from AOCL, net of tax, consisted of the following: | ||||||||||||||
(in thousands) | Minimum | Other | Total | |||||||||||
Pension and | Comprehensive | |||||||||||||
Post- | Loss Related to | |||||||||||||
Retirement | Equity | |||||||||||||
Liability | Investments | |||||||||||||
Beginning balance - December 30, 2012 | $ | -473,448 | $ | -7,868 | $ | -481,316 | ||||||||
Other comprehensive income (loss) before reclassifications | — | -666 | -666 | |||||||||||
Amounts reclassified from AOCL | 10,160 | — | 10,160 | |||||||||||
Other comprehensive income (loss) | 10,160 | -666 | 9,494 | |||||||||||
Ending balance - September 29, 2013 | $ | -463,288 | $ | -8,534 | $ | -471,822 | ||||||||
Amount Reclassified from AOCL | ||||||||||||||
(in thousands) | ||||||||||||||
Quarter Ended | Nine Months | |||||||||||||
Ended | ||||||||||||||
September 29, | September 29, | Affected Line in the Condensed | ||||||||||||
AOCL Component | 2013 | 2013 | Consolidated Statements of Operations | |||||||||||
Minimum pension and post-retirement liability | $ | 5,645 | $ | 16,933 | Compensation | |||||||||
-2,258 | -6,773 | Provision for income taxes | ||||||||||||
$ | 3,387 | $ | 10,160 | Net of tax | ||||||||||
Income Taxes | ||||||||||||||
We account for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. | ||||||||||||||
We recognize accrued interest related to unrecognized tax benefits in interest expense. Accrued penalties are recognized as a component of income tax expense. | ||||||||||||||
Earnings Per Share (EPS) | ||||||||||||||
Basic EPS excludes dilution from common stock equivalents and reflects income divided by the weighted average number of common shares outstanding for the period. Diluted EPS is based upon the weighted average number of outstanding shares of common stock and dilutive common stock equivalents in the period. Common stock equivalents arise from dilutive stock options, restricted stock units and restricted stock and are computed using the treasury stock method. Anti-dilutive common stock equivalents are excluded from diluted EPS. The weighted average anti-dilutive stock options that could potentially dilute basic EPS in the future, but were not included in the weighted average share calculation, consisted of the following: | ||||||||||||||
Quarter Ended | Nine Months Ended | |||||||||||||
September 29, | September 23, | September 29, | September 23, | |||||||||||
(shares in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Anti-dilutive stock options | 4,990 | 6,654 | 4,936 | 6,322 | ||||||||||
Cash Flow Information | ||||||||||||||
Cash paid for interest and income taxes consisted of the following: | ||||||||||||||
Nine Months Ended | ||||||||||||||
September 29, | September 23, | |||||||||||||
(in thousands) | 2013 | 2012 | ||||||||||||
Interest paid (net of amount capitalized) | $ | 82,990 | $ | 139,437 | ||||||||||
Income taxes paid (net of amounts received) | 13,202 | 35,945 | ||||||||||||
As of September 29, 2013, other non-cash financing activities included the release of $238.1 million for the financing obligation related to the Miami property transaction because we no longer have a continuing involvement with the Miami property (see Note 3). As of September 29, 2013, other non-cash investing activities included the release of $227.7 million from property, plant and equipment (“PP&E”), which also relates to the conclusion of the Miami property transaction. In addition, other non-cash financing activities as of September 29, 2013 and September 23, 2012, related to purchases of PP&E on credit, were $0.4 million and $3.6 million, respectively. | ||||||||||||||
Recently Adopted Accounting Pronouncements | ||||||||||||||
During the first quarter of 2013, we adopted the Financial Accounting Standards Board (“FASB”) accounting standards update (“ASU”) issued in February 2013. The ASU requires new disclosures about reclassifications from accumulated other comprehensive loss to net income. These disclosures may be presented on the face of the statements or in the notes to the consolidated financial statements. Accordingly, we have presented reclassifications from accumulated other comprehensive loss to the condensed consolidated statements of operations in the notes to our condensed consolidated financial statements. | ||||||||||||||
During the first quarter of 2013, we adopted the FASB ASU issued in July 2012. The ASU provides new guidance on annual impairment testing of indefinite-lived intangible assets. The ASU allows an entity to first assess qualitative factors to determine if it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount. If based on its qualitative assessment an entity concludes it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if an entity concludes otherwise, quantitative impairment testing is not required. The adoption of this standard did not impact our condensed consolidated financial statements. |
INVESTMENTS_IN_UNCONSOLIDATED_
INVESTMENTS IN UNCONSOLIDATED COMPANIES | 9 Months Ended | |||||||||
Sep. 29, 2013 | ||||||||||
INVESTMENTS IN UNCONSOLIDATED COMPANIES | ' | |||||||||
INVESTMENTS IN UNCONSOLIDATED COMPANIES | ' | |||||||||
2. INVESTMENTS IN UNCONSOLIDATED COMPANIES | ||||||||||
The carrying value of investments in unconsolidated companies consisted of the following: | ||||||||||
(in thousands) | % Ownership | September 29, | December 30, | |||||||
Company | Interest | 2013 | 2012 | |||||||
CareerBuilder, LLC | 15 | $ | 223,401 | $ | 210,365 | |||||
Classified Ventures, LLC | 25.6 | 90,778 | 69,907 | |||||||
HomeFinder, LLC | 33.3 | 1,535 | 2,573 | |||||||
Wanderful Media | 12.2 | 3,094 | 2,551 | |||||||
Seattle Times Company (C-Corporation) | 49.5 | — | — | |||||||
Ponderay (general partnership) | 27 | 9,390 | 11,375 | |||||||
Other | Various | 2,983 | 2,832 | |||||||
$ | 331,181 | $ | 299,603 | |||||||
In September 2013, Classified Ventures, LLC announced its intention to explore strategic alternatives for its Apartments.com business. | ||||||||||
During the nine months ended September 29, 2013, our proportionate share of net income from certain investees listed in the table above was greater than 20% of our condensed consolidated net income before taxes. Summarized condensed financial information, as provided to us by these certain investees, is as follows: | ||||||||||
Nine Months Ended | ||||||||||
September 29, | September 23, | |||||||||
(in thousands) | 2013 | 2012 | ||||||||
Net revenues | $ | 979,034 | $ | 913,688 | ||||||
Operating income | 180,120 | 160,934 | ||||||||
Net income | 181,791 | 158,536 | ||||||||
MIAMI_LAND_AND_BUILDING
MIAMI LAND AND BUILDING | 9 Months Ended |
Sep. 29, 2013 | |
MIAMI LAND AND BUILDING | ' |
MIAMI LAND AND BUILDING | ' |
3. MIAMI LAND AND BUILDING | |
On January 31, 2011, our contract to sell certain land in Miami (“Miami Contract”) terminated pursuant to its terms because the buyer (“developer”) did not consummate the transaction by the closing deadline in the contract. Under the terms of the Miami Contract, we were entitled to receive a $7.0 million termination fee and we filed a claim against the developer to obtain the payment. As of September 29, 2013, we have settled the claim for an undisclosed amount. | |
On May 27, 2011, we sold 14.0 acres of land in Miami, including a building, which held the operations of one of our subsidiaries, The Miami Herald Media Company, and adjacent parking lots, for a purchase price of $236.0 million (“Miami property”). Approximately 9.4 acres of this Miami property was previously subject to the terminated Miami Contract discussed above. We received cash proceeds of $230.0 million as a result of the sale. The additional $6.0 million was held in an escrow account for our expenses incurred in connection with the relocation of our Miami operations. In April 2012, we received these funds, which were released for payment of costs associated with the relocation of the Miami operations. | |
In connection with the sale transaction, The Miami Herald Media Company continued to operate from its existing location, at the Miami property, through May 2013 rent-free. As a result of our continuing involvement in the Miami property and because we did not pay rent during this period, the sale was treated as a financing transaction. Accordingly, we continued to depreciate the carrying value of the building until our operations were moved. In addition, we recorded a $236.0 million liability (in financing obligations) equal to the sales proceeds received of $230.0 million plus the $6.0 million received from the escrow account for reimbursement of moving expenses. We were imputing rent based on comparable market rates, which was reflected as interest expense until the operations were moved. As of the end of May 2013, we moved all of our Miami operations to a new site in Doral, Florida and no longer have a continuing involvement with the Miami property. As a result, in the quarter and nine months ended September 29, 2013, we recognized a gain of $2.9 million and $12.9 million, respectively, on the Miami transaction, which is recorded in non-operating (expense) income in our condensed consolidated statement of operations. We also released our financing obligation and PP&E from our condensed consolidated balance sheet during the quarter ended June 30, 2013, as described in Note 1, “Significant Accounting Policies” Cash Flow Information. | |
In the first quarter of 2012, we purchased approximately 6.1 acres of land located in Doral, Florida, for approximately $3.1 million. We completed construction of a new production facility on this site for our Miami newspaper operations. In January 2012, we also entered into an operating lease for a two-story office building adjacent to the new production facility. The operating lease on the office building has initial annual base lease payments of $1.8 million, which began in May 2013, when the building was occupied. |
LONGTERM_DEBT
LONG-TERM DEBT | 9 Months Ended | ||||||||||
Sep. 29, 2013 | |||||||||||
LONG-TERM DEBT | ' | ||||||||||
LONG-TERM DEBT | ' | ||||||||||
4. LONG-TERM DEBT | |||||||||||
Our long-term debt consisted of the following: | |||||||||||
Carrying Value | |||||||||||
Face Value at | September 29, | December 30, | |||||||||
September 29, | |||||||||||
(in thousands) | 2013 | 2013 | 2012 | ||||||||
Notes: | |||||||||||
9.00% senior secured notes due in 2022 | $ | 900,000 | $ | 900,000 | $ | 910,000 | |||||
11.50% senior secured notes due in 2017 | — | — | 83,016 | ||||||||
4.625% notes due in 2014 | 28,965 | 28,422 | 64,326 | ||||||||
5.750% notes due in 2017 | 261,298 | 251,647 | 273,559 | ||||||||
7.150% debentures due in 2027 | 89,188 | 83,585 | 83,291 | ||||||||
6.875% debentures due in 2029 | 276,230 | 257,074 | 256,154 | ||||||||
Long-term debt | $ | 1,555,681 | $ | 1,520,728 | $ | 1,670,346 | |||||
Less current portion | — | 83,016 | |||||||||
Total long-term debt, net of current | $ | 1,520,728 | $ | 1,587,330 | |||||||
Our outstanding notes are stated net of unamortized discounts, if applicable, totaling $35.0 million and $41.2 million as of September 29, 2013 and December 30, 2012, respectively. | |||||||||||
Debt Repurchases | |||||||||||
During the nine months ended September 29, 2013, we redeemed or repurchased a total of $155.9 million of notes through the completion of our debt refinancing described below and through privately negotiated transactions, as follows: | |||||||||||
(in thousands) | Face Value | ||||||||||
11.50% senior secured notes due in 2017 | $ | 83,595 | |||||||||
9.00% senior secured notes due in 2022 | 10,000 | ||||||||||
4.625% notes due in 2014 | 37,473 | ||||||||||
5.750% notes due in 2017 | 24,840 | ||||||||||
Total notes redeemed or repurchased | $ | 155,908 | |||||||||
We redeemed or repurchased all of these notes at a price greater than par value and wrote off historical discounts related to these notes, which resulted in a loss on extinguishment of debt of $0.9 million and $13.6 million in the quarter and nine months ended September 29, 2013, respectively. During the nine months ended September 23, 2012, we repurchased $70.5 million aggregate principal amount of outstanding notes. We repurchased most of these notes at a price lower than par value and wrote off historical discounts related to the notes we repurchased, resulting in a net gain on the extinguishment of debt. The gain was offset by the write-off of fees related to the amendment of the Second Amended and Restated Credit Agreement. These combined events resulted in a net gain on the extinguishment of debt of $6.1 million for the nine months ended September 23, 2012. No notes were repurchased during the quarter ended September 23, 2012. | |||||||||||
Credit Agreement | |||||||||||
In connection with the issuance of the 9.00% Senior Secured Notes due in 2022 (“9.00% Notes”) discussed below, we entered into the Third Amended and Restated Credit Agreement (“Credit Agreement”), dated as of December 18, 2012. The Credit Agreement provides for $75.0 million in revolving credit commitments, with a $50.0 million letter of credit subfacility, and has a maturity date of December 18, 2017. Our obligations under the Credit Agreement are secured by a first-priority security interest in certain of our assets as described below. As of September 29, 2013, there were no outstanding draw downs and $41.1 million face amount of letters of credit were outstanding under the Credit Agreement. | |||||||||||
Under the Credit Agreement, we may borrow at either the London Interbank Offered Rate plus a spread ranging from 275 basis points to 425 basis points, or at a base rate plus a spread ranging from 175 basis points to 325 basis points, in each case based upon our consolidated total leverage ratio. The Credit Agreement provides for a commitment fee payable on the unused revolving credit ranging from 50 basis points to 62.5 basis points, based upon our consolidated total leverage ratio. | |||||||||||
Senior Secured Notes and Indenture | |||||||||||
On December 18, 2012, we issued $910 million aggregate principal amount of 9.00% Notes. We received approximately $889 million net of financing costs in the offering and used the net proceeds, as well as cash on hand, to repurchase all of our outstanding $846 million in aggregate principal amount of the 11.50% Senior Secured Notes due in 2017 (“11.50% Notes”) in two separate transactions. On December 18, 2012, we repurchased $762.4 million of the 11.50% Notes pursuant to a cash tender offer done in connection with the issuance of the 9.00% Notes. In connection with this cash tender offer for our 11.50% Notes, we recorded a loss on the extinguishment of debt of approximately $94.5 million. In the nine months ended September 29, 2013, we redeemed the remaining $83.6 million aggregate principal amount of 11.50% Notes not tendered in the tender offer and we recorded a loss on the extinguishment of debt of approximately $9.6 million related to the redemption. | |||||||||||
Our 9.00% Notes were issued in a private placement. In July 2013, the original 9.00% Notes (and associated guarantees) were exchanged for new 9.00% Notes (and associated guarantees) that have terms substantially identical to the original notes except that the 9.00% Notes issued in the exchange are not subject to transfer restrictions. | |||||||||||
Substantially all of our subsidiaries guarantee the obligations under the 9.00% Notes and the Credit Agreement. We own 100% of each of the guarantor subsidiaries and we have no significant independent assets or operations separate from the subsidiaries that guarantee our 9.00% Notes and the Credit Agreement. The guarantees provided by the guarantor subsidiaries are full and unconditional and joint and several, and the assets of any of our subsidiaries, other than the subsidiary guarantors, are minor. | |||||||||||
In addition, we have granted a security interest to the banks that are a party to the Credit Agreement and the trustee under the indenture governing the 9.00% Notes that include, but are not limited to, intangible assets, inventory, receivables and certain minority investments as collateral for the debt. The security interest does not include any PP&E, leasehold interests and improvements with respect to such PP&E which would be reflected on our consolidated balance sheet or shares of stock and indebtedness of our subsidiaries. | |||||||||||
Covenants under the Senior Debt Agreements | |||||||||||
The financial covenants under the Credit Agreement require us to comply with a maximum consolidated total leverage ratio and a minimum consolidated interest coverage ratio, each measured quarterly. As of September 29, 2013, and for the remainder of the term of the Credit Agreement, we are required to maintain a consolidated total leverage ratio of not more than 6.00 to 1.00 and a consolidated interest coverage ratio of at least 1.50 to 1.00. As of September 29, 2013, we were in compliance with all financial debt covenants. | |||||||||||
The Credit Agreement also prohibits the payment of a dividend if a payment would not be permitted under the indenture for the 9.00% Notes (discussed below). Dividends under the indenture for the 9.00% Notes are allowed if the consolidated leverage ratio (as defined in the indenture) is less than 5.25 to 1.00 and we have sufficient amounts under our restricted payments basket (as defined in the indenture). | |||||||||||
The indenture for the 9.00% Notes includes a number of restrictive covenants that are applicable to us and our restricted subsidiaries. The covenants are subject to a number of important exceptions and qualifications set forth in the indenture for the 9.00% Notes. These covenants include, among other things, restrictions on our ability to incur additional debt; make investments and other restricted payments; pay dividends on capital stock or redeem or repurchase capital stock or certain of our outstanding notes or debentures prior to stated maturity; sell assets or enter into sale/leaseback transactions; create specified liens; create or permit restrictions on the ability of our restricted subsidiaries to pay dividends or make other distributions; engage in certain transactions with affiliates; and consolidate or merge with or into other companies or sell all or substantially all of the Company’s and our subsidiaries’ assets, taken as a whole. |
EMPLOYEE_BENEFITS
EMPLOYEE BENEFITS | 9 Months Ended | ||||||||||||||||
Sep. 29, 2013 | |||||||||||||||||
EMPLOYEE BENEFITS | ' | ||||||||||||||||
EMPLOYEE BENEFITS | ' | ||||||||||||||||
5. EMPLOYEE BENEFITS | |||||||||||||||||
We maintain a frozen noncontributory qualified defined benefit pension plan (“Pension Plan”) which covers certain eligible employees. No new participants may enter the Pension Plan and no further benefits will accrue. However, years of service continue to count toward early retirement calculations and vesting of benefits previously earned. | |||||||||||||||||
We also have a limited number of supplemental retirement plans to provide certain key employees with additional retirement benefits. These plans are funded on a pay-as-you-go basis and the accrued pension obligation is largely included in other long-term obligations. | |||||||||||||||||
The elements of retirement expense are as follows: | |||||||||||||||||
Quarter Ended | Nine Months Ended | ||||||||||||||||
September 29, | September 23, | September 29, | September 23, | ||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Pension plans: | |||||||||||||||||
Service cost | $ | 1,386 | $ | 1,385 | $ | 4,159 | $ | 4,155 | |||||||||
Interest cost | 21,149 | 22,974 | 63,447 | 68,923 | |||||||||||||
Expected return on plan assets | (25,263 | ) | (26,940 | ) | (75,790 | ) | (80,820 | ) | |||||||||
Prior service cost amortization | 4 | 4 | 11 | 11 | |||||||||||||
Actuarial loss | 6,389 | 3,172 | 19,168 | 9,515 | |||||||||||||
Net pension expense | 3,665 | 595 | 10,995 | 1,784 | |||||||||||||
Net post-retirement credit | (624 | ) | (157 | ) | (1,873 | ) | (472 | ) | |||||||||
Net retirement expense | $ | 3,041 | $ | 438 | $ | 9,122 | $ | 1,312 | |||||||||
In addition, we provide for or subsidize post-retirement health care and certain life insurance benefits for certain eligible employees and retirees, and we have a deferred compensation plan (“401(k) plan”), which enables qualified employees to voluntarily defer compensation. The 401(k) plan includes a matching company contribution and a supplemental contribution that is tied to our performance. We temporarily suspended our matching contribution to the 401(k) plan in 2009 and as of September 29, 2013, we have not reinstated that benefit. | |||||||||||||||||
In January 2013 and January 2012, we contributed $7.5 million and $40.0 million, respectively, of cash to the Pension Plan. We do not intend to make any additional material contributions to the Pension Plan during the remainder of fiscal year 2013. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 29, 2013 | |
COMMITMENTS AND CONTINGENCIES | ' |
COMMITMENTS AND CONTINGENCIES | ' |
6. COMMITMENTS AND CONTINGENCIES | |
We are subject to a variety of legal proceedings (including libel, employment, wage and hour, independent contractor and other legal actions) and governmental proceedings (including environmental matters) that arise from time to time in the ordinary course of our business. We are unable to estimate the amount or range of reasonably possible losses. However, we currently believe, after reviewing such actions with counsel, that the expected outcome of pending actions will not have a material effect on our condensed consolidated financial statements. No material amounts for any losses from litigation that may ultimately occur have been recorded in the condensed consolidated financial statements as we believe that any such losses are not probable. | |
We have certain indemnification obligations related to the sale of assets including but not limited to insurance claims and multi-employer pension plans of disposed newspaper operations. We believe the remaining obligations related to disposed assets will not be material to our financial position, results of operations or cash flows. | |
As of September 29, 2013, we had $41.1 million of standby letters of credit secured under the Credit Agreement (see Note 4 for further discussion). |
STOCK_PLANS
STOCK PLANS | 9 Months Ended | ||||||||||||||||
Sep. 29, 2013 | |||||||||||||||||
STOCK PLANS | ' | ||||||||||||||||
STOCK PLANS | ' | ||||||||||||||||
7. STOCK PLANS | |||||||||||||||||
Stock Plans Activity | |||||||||||||||||
The following table summarizes the restricted stock units (“RSUs”) activity during the nine months ended September 29, 2013: | |||||||||||||||||
Weighted Average | |||||||||||||||||
RSUs | Grant Date Fair Value | ||||||||||||||||
Nonvested - December 30, 2012 | 1,102,000 | $2.98 | |||||||||||||||
Granted | 648,150 | $2.61 | |||||||||||||||
Vested | (485,000 | ) | $3.72 | ||||||||||||||
Forfeited | (24,950 | ) | $2.48 | ||||||||||||||
Nonvested - September 29, 2013 | 1,240,200 | $2.50 | |||||||||||||||
The total fair value of the RSUs that vested during the nine months ended September 29, 2013 was $1.3 million. | |||||||||||||||||
The following table summarizes the stock appreciation rights (“SARs”) activity during the nine months ended September 29, 2013: | |||||||||||||||||
Weighted | Aggregate | ||||||||||||||||
Average | Intrinsic | ||||||||||||||||
Options/ | Exercise | Value | |||||||||||||||
SARs | Price | (in thousands) | |||||||||||||||
Outstanding December 30, 2012 | 6,194,500 | $11.45 | $1,846 | ||||||||||||||
Granted | 775,000 | $2.46 | |||||||||||||||
Exercised | (522,750 | ) | $1.71 | $819 | |||||||||||||
Forfeited | (44,000 | ) | $3.27 | ||||||||||||||
Expired | (101,750 | ) | $38.53 | ||||||||||||||
Outstanding September 29, 2013 | 6,301,000 | $10.77 | $1,605 | ||||||||||||||
For the nine months ended September 29, 2013, the following weighted average assumptions were used to estimate the fair value of the SARs granted: | |||||||||||||||||
Nine Months | |||||||||||||||||
Ended | |||||||||||||||||
September 29, | |||||||||||||||||
2013 | |||||||||||||||||
Expected life in years | 4.51 | ||||||||||||||||
Dividend yield | NIL | ||||||||||||||||
Volatility | 1.08 | ||||||||||||||||
Risk-free interest rate | 0.76% | ||||||||||||||||
Weighted average exercise price of SARs granted | $ | 2.46 | |||||||||||||||
Weighted average fair value of SARs granted | $ | 1.85 | |||||||||||||||
Stock-Based Compensation | |||||||||||||||||
All stock-based payments, including grants of stock appreciation rights, restricted stock units and common stock under equity incentive plans, are recognized in the financial statements based on their grant date fair values. At September 29, 2013, we had five stock-based compensation plans. Stock-based compensation expenses are reported in the compensation line item in the condensed consolidated statements of operations. Total stock-based compensation expense for the periods presented in this report is summarized below: | |||||||||||||||||
Quarter Ended | Nine Months Ended | ||||||||||||||||
September 29, | September 23, | September 29, | September 23, | ||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Stock-based compensation expense | $ | 1,067 | $ | 940 | $ | 2,834 | $ | 2,734 | |||||||||
INCOME_TAXES
INCOME TAXES | 9 Months Ended |
Sep. 29, 2013 | |
INCOME TAXES | ' |
INCOME TAXES | ' |
8. INCOME TAXES | |
During the quarter and nine months ended September 29, 2013, our income tax provision included rate adjustments and the benefit of the reversal of state tax reserves relating to the favorable settlements of state tax audits and state statute lapses. During the quarter and nine months ended September 23, 2012, our income tax provision included the benefit of the reversal of state tax reserves relating to the favorable settlements of state tax audits and state statute lapses. These reserve reversals are the primary driver of the effective benefit rates for each period presented in 2012. |
SIGNIFICANT_ACCOUNTING_POLICIE1
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended | |||||||||||||
Sep. 29, 2013 | ||||||||||||||
SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||||
Business and Basis of Accounting | ' | |||||||||||||
Business and Basis of Accounting | ||||||||||||||
The McClatchy Company (the “Company,” “we,” “us” or “our”) is a leading news, advertising and information provider, offering a wide array of print and digital products in each of the markets it serves. As the third largest newspaper company in the United States, based on daily circulation, our operations include 30 daily newspapers, community newspapers, websites, mobile news and advertising, niche publications, direct marketing and direct mail services. Our largest newspapers include the (Fort Worth) Star-Telegram, The Sacramento Bee, The Kansas City Star, the Miami Herald, The Charlotte Observer and The (Raleigh) News & Observer. We are listed on the New York Stock Exchange under the symbol MNI. | ||||||||||||||
We also own a portfolio of premium digital assets, including 15.0% of CareerBuilder LLC, which operates the nation’s largest online jobs website, CareerBuilder.com; 25.6% of Classified Ventures LLC, a company that offers classified websites such as the auto website Cars.com and the rental website Apartments.com; 33.3% of HomeFinder LLC, which operates the online real estate website HomeFinder.com; and 12.2% of Wanderful Media, owner of Find & Save®, a digital shopping portal that provides advertisers with a common platform to reach online audiences with digital circulars, coupons and display advertising. | ||||||||||||||
The condensed consolidated financial statements include the Company and our subsidiaries. Intercompany items and transactions are eliminated. Preparation of the financial statements in conformity with accounting principles generally accepted in the United States and pursuant to the rules and regulation of the Securities and Exchange Commission requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. | ||||||||||||||
In our opinion, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly our financial position, results of operations, and cash flows for the interim periods presented. The financial statements contained in this report are not necessarily indicative of the results to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K and Amendment No. 1 to the Form 10-K for the year ended December 30, 2012 (collectively “Form 10-K”). The fiscal periods included herein comprise 13 weeks and 39 weeks for the third-quarter and nine-month periods, respectively. | ||||||||||||||
Outsourcing Agreement | ' | |||||||||||||
Outsourcing Agreement | ||||||||||||||
In October 2013, we entered into an outsourcing agreement to print one of our newspapers beginning in late February 2014. As a result, we expect to incur non-cash charges, including accelerated depreciation and other charges related to our existing facilities and production equipment of up to $15 million in the fourth quarter of 2013. We do not anticipate any material cash expenses during the fourth quarter of 2013 related to this agreement. | ||||||||||||||
Circulation Delivery Contract Accounting Correction | ' | |||||||||||||
Circulation Delivery Contract Accounting Correction | ||||||||||||||
Subsequent to the issuance of our consolidated financial statements on March 6, 2013, we determined that circulation revenues associated with our “fee for service” contracts with distributors and carriers should be presented on a gross basis, as opposed to on a net basis, as we are established as the primary obligor through subscriber agreements. The difference in presentation results in delivery costs associated with these contracts being reported as other operating expenses, rather than as a reduction in circulation revenues, in our condensed consolidated statements of operations. This correction resulted in an increase to circulation revenues and equivalent increases to other operating expenses of $18.9 million and $58.1 million in the quarter and nine months ended September 23, 2012, respectively. We believe this correction is not material to our previously issued financial statements for prior periods. There is no impact to the previously reported operating income, net income, net income per common share or cash flows from operating activities in any of the periods presented. | ||||||||||||||
Fair Value of Financial Instruments | ' | |||||||||||||
Fair Value of Financial Instruments | ||||||||||||||
We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are: | ||||||||||||||
Level 1 – Unadjusted quoted prices available in active markets for identical investments as of the reporting date. | ||||||||||||||
Level 2 – Observable inputs to the valuation methodology are other than Level 1 inputs and are either directly or indirectly observable as of the reporting date and fair value can be determined through the use of models or other valuation methodologies. | ||||||||||||||
Level 3 – Inputs to the valuation methodology are unobservable inputs in situations where there is little or no market activity for the asset or liability, and the reporting entity makes estimates and assumptions related to the pricing of the asset or liability including assumptions regarding risk. | ||||||||||||||
Our policy is to recognize significant transfers between levels at the actual date of the event or circumstance that caused the transfer. The following methods and assumptions were used to estimate the fair value of each class of financial instruments: | ||||||||||||||
Cash and cash equivalents, accounts receivable and accounts payable. The carrying amount of these items approximates fair value. | ||||||||||||||
Long-term debt. The fair value of long-term debt is determined using quoted market prices and other inputs that were derived from available market information including the current market activity of our publicly-traded notes and bank debt, trends in investor demand and market values of comparable publicly-traded debt. These are considered to be Level 2 inputs under the fair value measurements and disclosure guidance, and may not be representative of actual value. At September 29, 2013, the estimated fair value and carrying value of long-term debt was $1.5 billion. | ||||||||||||||
Intangible Assets and Goodwill | ' | |||||||||||||
Intangible Assets and Goodwill | ||||||||||||||
Intangible assets (primarily advertiser lists, subscriber lists and developed technology) and goodwill consisted of the following: | ||||||||||||||
December 30, | Acquired | Amortization | September 29, | |||||||||||
(in thousands) | 2012 | Assets | Expense | 2013 | ||||||||||
Intangible assets subject to amortization | $ | 834,961 | $ | 500 | — | $ | 835,461 | |||||||
Accumulated amortization | -510,546 | — | $ | -42,877 | -553,423 | |||||||||
324,415 | 500 | -42,877 | 282,038 | |||||||||||
Mastheads | 203,587 | — | N/A | 203,587 | ||||||||||
Goodwill | 1,012,011 | 903 | N/A | 1,012,914 | ||||||||||
Total | $ | 1,540,013 | $ | 1,403 | $ | -42,877 | $ | 1,498,539 | ||||||
During the nine months ended September 29, 2013, we completed a small acquisition, which is reflected in goodwill and intangible assets subject to amortization. | ||||||||||||||
Amortization expense with respect to intangible assets is summarized below: | ||||||||||||||
Quarter Ended | Nine Months Ended | |||||||||||||
September 29, | September 23, | September 29, | September 23, | |||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Amortization expense | $ | 14,375 | $ | 14,251 | $ | 42,877 | $ | 42,811 | ||||||
The estimated amortization expense for the remainder of fiscal year 2013 and the five succeeding fiscal years is as follows: | ||||||||||||||
Amortization | ||||||||||||||
Expense | ||||||||||||||
Year | (in thousands) | |||||||||||||
2013 (remainder) | $ | 14,304 | ||||||||||||
2014 | 52,757 | |||||||||||||
2015 | 48,086 | |||||||||||||
2016 | 47,721 | |||||||||||||
2017 | 48,552 | |||||||||||||
2018 | 46,977 | |||||||||||||
Accumulated Other Comprehensive Loss | ' | |||||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||||
Our accumulated other comprehensive loss (“AOCL”) and reclassifications from AOCL, net of tax, consisted of the following: | ||||||||||||||
(in thousands) | Minimum | Other | Total | |||||||||||
Pension and | Comprehensive | |||||||||||||
Post- | Loss Related to | |||||||||||||
Retirement | Equity | |||||||||||||
Liability | Investments | |||||||||||||
Beginning balance - December 30, 2012 | $ | -473,448 | $ | -7,868 | $ | -481,316 | ||||||||
Other comprehensive income (loss) before reclassifications | — | -666 | -666 | |||||||||||
Amounts reclassified from AOCL | 10,160 | — | 10,160 | |||||||||||
Other comprehensive income (loss) | 10,160 | -666 | 9,494 | |||||||||||
Ending balance - September 29, 2013 | $ | -463,288 | $ | -8,534 | $ | -471,822 | ||||||||
Amount Reclassified from AOCL | ||||||||||||||
(in thousands) | ||||||||||||||
Quarter Ended | Nine Months | |||||||||||||
Ended | ||||||||||||||
September 29, | September 29, | Affected Line in the Condensed | ||||||||||||
AOCL Component | 2013 | 2013 | Consolidated Statements of Operations | |||||||||||
Minimum pension and post-retirement liability | $ | 5,645 | $ | 16,933 | Compensation | |||||||||
-2,258 | -6,773 | Provision for income taxes | ||||||||||||
$ | 3,387 | $ | 10,160 | Net of tax | ||||||||||
Income Taxes | ' | |||||||||||||
Income Taxes | ||||||||||||||
We account for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. | ||||||||||||||
We recognize accrued interest related to unrecognized tax benefits in interest expense. Accrued penalties are recognized as a component of income tax expense. | ||||||||||||||
Earnings Per Share (EPS) | ' | |||||||||||||
Earnings Per Share (EPS) | ||||||||||||||
Basic EPS excludes dilution from common stock equivalents and reflects income divided by the weighted average number of common shares outstanding for the period. Diluted EPS is based upon the weighted average number of outstanding shares of common stock and dilutive common stock equivalents in the period. Common stock equivalents arise from dilutive stock options, restricted stock units and restricted stock and are computed using the treasury stock method. Anti-dilutive common stock equivalents are excluded from diluted EPS. The weighted average anti-dilutive stock options that could potentially dilute basic EPS in the future, but were not included in the weighted average share calculation, consisted of the following: | ||||||||||||||
Quarter Ended | Nine Months Ended | |||||||||||||
September 29, | September 23, | September 29, | September 23, | |||||||||||
(shares in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Anti-dilutive stock options | 4,990 | 6,654 | 4,936 | 6,322 | ||||||||||
Cash Flow Information | ' | |||||||||||||
Cash Flow Information | ||||||||||||||
Cash paid for interest and income taxes consisted of the following: | ||||||||||||||
Nine Months Ended | ||||||||||||||
September 29, | September 23, | |||||||||||||
(in thousands) | 2013 | 2012 | ||||||||||||
Interest paid (net of amount capitalized) | $ | 82,990 | $ | 139,437 | ||||||||||
Income taxes paid (net of amounts received) | 13,202 | 35,945 | ||||||||||||
As of September 29, 2013, other non-cash financing activities included the release of $238.1 million for the financing obligation related to the Miami property transaction because we no longer have a continuing involvement with the Miami property (see Note 3). As of September 29, 2013, other non-cash investing activities included the release of $227.7 million from property, plant and equipment (“PP&E”), which also relates to the conclusion of the Miami property transaction. In addition, other non-cash financing activities as of September 29, 2013 and September 23, 2012, related to purchases of PP&E on credit, were $0.4 million and $3.6 million, respectively. | ||||||||||||||
Recently Adopted Accounting Pronouncements | ' | |||||||||||||
Recently Adopted Accounting Pronouncements | ||||||||||||||
During the first quarter of 2013, we adopted the Financial Accounting Standards Board (“FASB”) accounting standards update (“ASU”) issued in February 2013. The ASU requires new disclosures about reclassifications from accumulated other comprehensive loss to net income. These disclosures may be presented on the face of the statements or in the notes to the consolidated financial statements. Accordingly, we have presented reclassifications from accumulated other comprehensive loss to the condensed consolidated statements of operations in the notes to our condensed consolidated financial statements. | ||||||||||||||
During the first quarter of 2013, we adopted the FASB ASU issued in July 2012. The ASU provides new guidance on annual impairment testing of indefinite-lived intangible assets. The ASU allows an entity to first assess qualitative factors to determine if it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount. If based on its qualitative assessment an entity concludes it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if an entity concludes otherwise, quantitative impairment testing is not required. The adoption of this standard did not impact our condensed consolidated financial statements. |
SIGNIFICANT_ACCOUNTING_POLICIE2
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended | |||||||||||||
Sep. 29, 2013 | ||||||||||||||
SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||||
Schedule of intangible assets (primarily advertiser lists, subscriber lists and developed technology) and goodwill | ' | |||||||||||||
December 30, | Acquired | Amortization | September 29, | |||||||||||
(in thousands) | 2012 | Assets | Expense | 2013 | ||||||||||
Intangible assets subject to amortization | $ | 834,961 | $ | 500 | — | $ | 835,461 | |||||||
Accumulated amortization | -510,546 | — | $ | -42,877 | -553,423 | |||||||||
324,415 | 500 | -42,877 | 282,038 | |||||||||||
Mastheads | 203,587 | — | N/A | 203,587 | ||||||||||
Goodwill | 1,012,011 | 903 | N/A | 1,012,914 | ||||||||||
Total | $ | 1,540,013 | $ | 1,403 | $ | -42,877 | $ | 1,498,539 | ||||||
Summary of amortization expense with respect to intangible assets | ' | |||||||||||||
Quarter Ended | Nine Months Ended | |||||||||||||
September 29, | September 23, | September 29, | September 23, | |||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Amortization expense | $ | 14,375 | $ | 14,251 | $ | 42,877 | $ | 42,811 | ||||||
Amortization expense for the five succeeding fiscal years | ' | |||||||||||||
Amortization | ||||||||||||||
Expense | ||||||||||||||
Year | (in thousands) | |||||||||||||
2013 (remainder) | $ | 14,304 | ||||||||||||
2014 | 52,757 | |||||||||||||
2015 | 48,086 | |||||||||||||
2016 | 47,721 | |||||||||||||
2017 | 48,552 | |||||||||||||
2018 | 46,977 | |||||||||||||
Schedule of components of accumulated other comprehensive loss and reclassifications, net of tax | ' | |||||||||||||
(in thousands) | Minimum | Other | Total | |||||||||||
Pension and | Comprehensive | |||||||||||||
Post- | Loss Related to | |||||||||||||
Retirement | Equity | |||||||||||||
Liability | Investments | |||||||||||||
Beginning balance - December 30, 2012 | $ | -473,448 | $ | -7,868 | $ | -481,316 | ||||||||
Other comprehensive income (loss) before reclassifications | — | -666 | -666 | |||||||||||
Amounts reclassified from AOCL | 10,160 | — | 10,160 | |||||||||||
Other comprehensive income (loss) | 10,160 | -666 | 9,494 | |||||||||||
Ending balance - September 29, 2013 | $ | -463,288 | $ | -8,534 | $ | -471,822 | ||||||||
Amount Reclassified from AOCL | ||||||||||||||
(in thousands) | ||||||||||||||
Quarter Ended | Nine Months | |||||||||||||
Ended | ||||||||||||||
September 29, | September 29, | Affected Line in the Condensed | ||||||||||||
AOCL Component | 2013 | 2013 | Consolidated Statements of Operations | |||||||||||
Minimum pension and post-retirement liability | $ | 5,645 | $ | 16,933 | Compensation | |||||||||
-2,258 | -6,773 | Provision for income taxes | ||||||||||||
$ | 3,387 | $ | 10,160 | Net of tax | ||||||||||
Summary of anti-dilutive stock options | ' | |||||||||||||
Quarter Ended | Nine Months Ended | |||||||||||||
September 29, | September 23, | September 29, | September 23, | |||||||||||
(shares in thousands) | 2013 | 2012 | 2013 | 2012 | ||||||||||
Anti-dilutive stock options | 4,990 | 6,654 | 4,936 | 6,322 | ||||||||||
Schedule of cash paid for interest and income taxes | ' | |||||||||||||
Nine Months Ended | ||||||||||||||
September 29, | September 23, | |||||||||||||
(in thousands) | 2013 | 2012 | ||||||||||||
Interest paid (net of amount capitalized) | $ | 82,990 | $ | 139,437 | ||||||||||
Income taxes paid (net of amounts received) | 13,202 | 35,945 | ||||||||||||
INVESTMENTS_IN_UNCONSOLIDATED_1
INVESTMENTS IN UNCONSOLIDATED COMPANIES (Tables) | 9 Months Ended | |||||||||
Sep. 29, 2013 | ||||||||||
INVESTMENTS IN UNCONSOLIDATED COMPANIES | ' | |||||||||
Summary of carrying value of investments in unconsolidated companies | ' | |||||||||
(in thousands) | % Ownership | September 29, | December 30, | |||||||
Company | Interest | 2013 | 2012 | |||||||
CareerBuilder, LLC | 15 | $ | 223,401 | $ | 210,365 | |||||
Classified Ventures, LLC | 25.6 | 90,778 | 69,907 | |||||||
HomeFinder, LLC | 33.3 | 1,535 | 2,573 | |||||||
Wanderful Media | 12.2 | 3,094 | 2,551 | |||||||
Seattle Times Company (C-Corporation) | 49.5 | — | — | |||||||
Ponderay (general partnership) | 27 | 9,390 | 11,375 | |||||||
Other | Various | 2,983 | 2,832 | |||||||
$ | 331,181 | $ | 299,603 | |||||||
Summary of condensed financial information as provided by certain investees | ' | |||||||||
Nine Months Ended | ||||||||||
September 29, | September 23, | |||||||||
(in thousands) | 2013 | 2012 | ||||||||
Net revenues | $ | 979,034 | $ | 913,688 | ||||||
Operating income | 180,120 | 160,934 | ||||||||
Net income | 181,791 | 158,536 | ||||||||
LONGTERM_DEBT_Tables
LONG-TERM DEBT (Tables) | 9 Months Ended | ||||||||||
Sep. 29, 2013 | |||||||||||
LONG-TERM DEBT | ' | ||||||||||
Summary of company's long-term debt | ' | ||||||||||
Carrying Value | |||||||||||
Face Value at | September 29, | December 30, | |||||||||
September 29, | |||||||||||
(in thousands) | 2013 | 2013 | 2012 | ||||||||
Notes: | |||||||||||
9.00% senior secured notes due in 2022 | $ | 900,000 | $ | 900,000 | $ | 910,000 | |||||
11.50% senior secured notes due in 2017 | — | — | 83,016 | ||||||||
4.625% notes due in 2014 | 28,965 | 28,422 | 64,326 | ||||||||
5.750% notes due in 2017 | 261,298 | 251,647 | 273,559 | ||||||||
7.150% debentures due in 2027 | 89,188 | 83,585 | 83,291 | ||||||||
6.875% debentures due in 2029 | 276,230 | 257,074 | 256,154 | ||||||||
Long-term debt | $ | 1,555,681 | $ | 1,520,728 | $ | 1,670,346 | |||||
Less current portion | — | 83,016 | |||||||||
Total long-term debt, net of current | $ | 1,520,728 | $ | 1,587,330 | |||||||
Redeemed or repurchase of notes | ' | ||||||||||
(in thousands) | Face Value | ||||||||||
11.50% senior secured notes due in 2017 | $ | 83,595 | |||||||||
9.00% senior secured notes due in 2022 | 10,000 | ||||||||||
4.625% notes due in 2014 | 37,473 | ||||||||||
5.750% notes due in 2017 | 24,840 | ||||||||||
Total notes redeemed or repurchased | $ | 155,908 |
EMPLOYEE_BENEFITS_Tables
EMPLOYEE BENEFITS (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 29, 2013 | |||||||||||||||||
EMPLOYEE BENEFITS | ' | ||||||||||||||||
Schedule of elements of retirement expense | ' | ||||||||||||||||
Quarter Ended | Nine Months Ended | ||||||||||||||||
September 29, | September 23, | September 29, | September 23, | ||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Pension plans: | |||||||||||||||||
Service cost | $ | 1,386 | $ | 1,385 | $ | 4,159 | $ | 4,155 | |||||||||
Interest cost | 21,149 | 22,974 | 63,447 | 68,923 | |||||||||||||
Expected return on plan assets | (25,263 | ) | (26,940 | ) | (75,790 | ) | (80,820 | ) | |||||||||
Prior service cost amortization | 4 | 4 | 11 | 11 | |||||||||||||
Actuarial loss | 6,389 | 3,172 | 19,168 | 9,515 | |||||||||||||
Net pension expense | 3,665 | 595 | 10,995 | 1,784 | |||||||||||||
Net post-retirement credit | (624 | ) | (157 | ) | (1,873 | ) | (472 | ) | |||||||||
Net retirement expense | $ | 3,041 | $ | 438 | $ | 9,122 | $ | 1,312 |
STOCK_PLANS_Tables
STOCK PLANS (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 29, 2013 | |||||||||||||||||
STOCK PLANS | ' | ||||||||||||||||
Summary of the restricted stock units ("RSUs") activity | ' | ||||||||||||||||
Weighted Average | |||||||||||||||||
RSUs | Grant Date Fair Value | ||||||||||||||||
Nonvested - December 30, 2012 | 1,102,000 | $2.98 | |||||||||||||||
Granted | 648,150 | $2.61 | |||||||||||||||
Vested | (485,000 | ) | $3.72 | ||||||||||||||
Forfeited | (24,950 | ) | $2.48 | ||||||||||||||
Nonvested - September 29, 2013 | 1,240,200 | $2.50 | |||||||||||||||
Summary of the stock appreciation rights ("SARs") activity | ' | ||||||||||||||||
Weighted | Aggregate | ||||||||||||||||
Average | Intrinsic | ||||||||||||||||
Options/ | Exercise | Value | |||||||||||||||
SARs | Price | (in thousands) | |||||||||||||||
Outstanding December 30, 2012 | 6,194,500 | $11.45 | $1,846 | ||||||||||||||
Granted | 775,000 | $2.46 | |||||||||||||||
Exercised | (522,750 | ) | $1.71 | $819 | |||||||||||||
Forfeited | (44,000 | ) | $3.27 | ||||||||||||||
Expired | (101,750 | ) | $38.53 | ||||||||||||||
Outstanding September 29, 2013 | 6,301,000 | $10.77 | $1,605 | ||||||||||||||
Schedule of weighted average assumptions used to estimate the fair value of SARs granted | ' | ||||||||||||||||
Nine Months | |||||||||||||||||
Ended | |||||||||||||||||
September 29, | |||||||||||||||||
2013 | |||||||||||||||||
Expected life in years | 4.51 | ||||||||||||||||
Dividend yield | NIL | ||||||||||||||||
Volatility | 1.08 | ||||||||||||||||
Risk-free interest rate | 0.76% | ||||||||||||||||
Weighted average exercise price of SARs granted | $ | 2.46 | |||||||||||||||
Weighted average fair value of SARs granted | $ | 1.85 | |||||||||||||||
Summary of stock-based compensation expense | ' | ||||||||||||||||
Quarter Ended | Nine Months Ended | ||||||||||||||||
September 29, | September 23, | September 29, | September 23, | ||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Stock-based compensation expense | $ | 1,067 | $ | 940 | $ | 2,834 | $ | 2,734 | |||||||||
SIGNIFICANT_ACCOUNTING_POLICIE3
SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | |||||||
Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 | Dec. 30, 2012 | Sep. 30, 2013 | Sep. 23, 2012 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | |
newspaper | newspaper | Maximum | Correction of error adjustment | Correction of error adjustment | Career Builder LLC | Classified Ventures LLC | Home Finder LLC | Wanderful Media | ||||
SIGNIFICANT ACCOUNTING POLICIES | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of daily newspapers | 30 | ' | 30 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Length of fiscal quarter | '91 days | ' | '273 days | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related Party Transaction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership Interest (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | 15.00% | 25.60% | 33.30% | 12.20% |
Expected accelerated depreciation and other charges related to existing facilities and production equipment | ' | ' | ' | ' | ' | $15,000,000 | ' | ' | ' | ' | ' | ' |
Correction of error adjustment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increases to circulation revenues | 86,960,000 | 81,639,000 | 261,253,000 | 250,830,000 | ' | ' | 18,900,000 | 58,100,000 | ' | ' | ' | ' |
Increases to other operating expenses | 104,401,000 | 101,633,000 | 313,588,000 | 305,933,000 | ' | ' | 18,900,000 | 58,100,000 | ' | ' | ' | ' |
Long-term debt fair value disclosure | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated fair value of long-term debt | 1,500,000,000 | ' | 1,500,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Carrying value of long-term debt | 1,520,728,000 | ' | 1,520,728,000 | ' | 1,670,346,000 | ' | ' | ' | ' | ' | ' | ' |
Intangible assets subject to amortization, gross | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | 834,961,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquired Assets | ' | ' | 500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period | 835,461,000 | ' | 835,461,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accumulated amortization | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | -510,546,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization Expense | -14,375,000 | -14,251,000 | -42,877,000 | -42,811,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period | -553,423,000 | ' | -553,423,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets subject to amortization, net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | 324,415,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquired Assets | ' | ' | 500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization Expense | -14,375,000 | -14,251,000 | -42,877,000 | -42,811,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period | 282,038,000 | ' | 282,038,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Mastheads | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | 203,587,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period | 203,587,000 | ' | 203,587,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | 1,012,011,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquired Assets | ' | ' | 903,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period | 1,012,914,000 | ' | 1,012,914,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | 1,540,013,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquired Assets | ' | ' | 1,403,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization Expense | -14,375,000 | -14,251,000 | -42,877,000 | -42,811,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period | 1,498,539,000 | ' | 1,498,539,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization expense | 14,375,000 | 14,251,000 | 42,877,000 | 42,811,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2013 (remainder) | 14,304,000 | ' | 14,304,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 52,757,000 | ' | 52,757,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 48,086,000 | ' | 48,086,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 47,721,000 | ' | 47,721,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 48,552,000 | ' | 48,552,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | $46,977,000 | ' | $46,977,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
SIGNIFICANT_ACCOUNTING_POLICIE4
SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 |
Changes in accumulated other comprehensive loss | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | ($481,316) | ' |
Other comprehensive income (loss) before reclassifications | ' | ' | -666 | ' |
Amounts reclassified from AOCL | ' | ' | 10,160 | ' |
Other comprehensive income | 3,452 | 1,861 | 9,494 | 3,868 |
Balance at the end of the period | -471,822 | ' | -471,822 | ' |
Compensation | 105,239 | 108,421 | 325,972 | 329,156 |
Provision for income taxes | 2,911 | -556 | 5,066 | -6,000 |
Net of tax | -7,265 | -5,093 | -6,276 | -29,871 |
Minimum Pension and Post-Retirement Liability | ' | ' | ' | ' |
Changes in accumulated other comprehensive loss | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | -473,448 | ' |
Amounts reclassified from AOCL | ' | ' | 10,160 | ' |
Other comprehensive income | ' | ' | 10,160 | ' |
Balance at the end of the period | -463,288 | ' | -463,288 | ' |
Minimum Pension and Post-Retirement Liability | Amount Reclassified from AOCI | ' | ' | ' | ' |
Changes in accumulated other comprehensive loss | ' | ' | ' | ' |
Compensation | 5,645 | ' | 16,933 | ' |
Provision for income taxes | -2,258 | ' | -6,773 | ' |
Net of tax | 3,387 | ' | 10,160 | ' |
Other Comprehensive Loss Related to Equity Investments | ' | ' | ' | ' |
Changes in accumulated other comprehensive loss | ' | ' | ' | ' |
Balance at the beginning of the period | ' | ' | -7,868 | ' |
Other comprehensive income (loss) before reclassifications | ' | ' | -666 | ' |
Other comprehensive income | ' | ' | -666 | ' |
Balance at the end of the period | ($8,534) | ' | ($8,534) | ' |
SIGNIFICANT_ACCOUNTING_POLICIE5
SIGNIFICANT ACCOUNTING POLICIES (Details 3) (Anti-dilutive stock options, restricted stock units and restricted stock) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 |
Anti-dilutive stock options, restricted stock units and restricted stock | ' | ' | ' | ' |
Weighted average anti-dilutive stock options | ' | ' | ' | ' |
Anti-dilutive stock options (in shares) | 4,990 | 6,654 | 4,936 | 6,322 |
SIGNIFICANT_ACCOUNTING_POLICIE6
SIGNIFICANT ACCOUNTING POLICIES (Details 4) (USD $) | 9 Months Ended | |
Sep. 29, 2013 | Sep. 23, 2012 | |
Cash Flow Information | ' | ' |
Interest paid (net of amount capitalized) | $82,990,000 | $139,437,000 |
Income taxes paid (net of amounts received) | 13,202,000 | 35,945,000 |
Other non-cash financing activities | ' | ' |
Purchases of PP&E on credit | 400,000 | 3,600,000 |
Sale of land and building | ' | ' |
Cash Flow Information | ' | ' |
Financing obligations released | 238,100,000 | ' |
Investing obligations released | $227,700,000 | ' |
INVESTMENTS_IN_UNCONSOLIDATED_2
INVESTMENTS IN UNCONSOLIDATED COMPANIES (Details) (USD $) | Sep. 29, 2013 | Dec. 30, 2012 |
In Thousands, unless otherwise specified | ||
Investments in unconsolidated companies and joint ventures | ' | ' |
Investments in unconsolidated companies | $331,181 | $299,603 |
Career Builder LLC | ' | ' |
Investments in unconsolidated companies and joint ventures | ' | ' |
Ownership Interest (as a percent) | 15.00% | ' |
Investments in unconsolidated companies | 223,401 | 210,365 |
Classified Ventures LLC | ' | ' |
Investments in unconsolidated companies and joint ventures | ' | ' |
Ownership Interest (as a percent) | 25.60% | ' |
Investments in unconsolidated companies | 90,778 | 69,907 |
Home Finder LLC | ' | ' |
Investments in unconsolidated companies and joint ventures | ' | ' |
Ownership Interest (as a percent) | 33.30% | ' |
Investments in unconsolidated companies | 1,535 | 2,573 |
Wanderful Media | ' | ' |
Investments in unconsolidated companies and joint ventures | ' | ' |
Ownership Interest (as a percent) | 12.20% | ' |
Investments in unconsolidated companies | 3,094 | 2,551 |
Seattle Times Company (C-Corporation) | ' | ' |
Investments in unconsolidated companies and joint ventures | ' | ' |
Ownership Interest (as a percent) | 49.50% | ' |
Ponderay (general partnership) | ' | ' |
Investments in unconsolidated companies and joint ventures | ' | ' |
Ownership Interest (as a percent) | 27.00% | ' |
Investments in unconsolidated companies | 9,390 | 11,375 |
Other | ' | ' |
Investments in unconsolidated companies and joint ventures | ' | ' |
Investments in unconsolidated companies | $2,983 | $2,832 |
INVESTMENTS_IN_UNCONSOLIDATED_3
INVESTMENTS IN UNCONSOLIDATED COMPANIES (Details 2) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 |
INVESTMENTS IN UNCONSOLIDATED COMPANIES | ' | ' |
Proportionate share of net income before taxes (as a percent) | 20.00% | ' |
Condensed financial information | ' | ' |
Net revenues | $979,034 | $913,688 |
Operating income | 180,120 | 160,934 |
Net income | $181,791 | $158,536 |
MIAMI_LAND_AND_BUILDING_Detail
MIAMI LAND AND BUILDING (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | |||
Sep. 29, 2013 | Sep. 29, 2013 | Sep. 23, 2012 | Dec. 30, 2012 | Jan. 31, 2011 | 27-May-11 | Apr. 30, 2012 | Jun. 30, 2013 | Sep. 29, 2013 | Mar. 25, 2012 | |
Terminated Miami land sale contract | Sale of land and building | Sale of land and building | Sale of land and building | Sale of land and building | Acquisition of land in Doral, Florida | |||||
acre | acre | acre | ||||||||
Miami Land and Building Disclosures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contract Termination Fee | ' | ' | ' | ' | $7,000,000 | ' | ' | ' | ' | ' |
Company sold land | ' | ' | ' | ' | 9.4 | 14 | ' | ' | ' | 6.1 |
Purchase price | ' | ' | ' | ' | ' | 236,000,000 | ' | ' | ' | ' |
Financing obligation | 40,743,000 | 40,743,000 | ' | 279,325,000 | ' | 236,000,000 | ' | ' | ' | ' |
Escrow deposits related to property sales in noncash investing and financing activities | ' | ' | ' | ' | ' | 6,000,000 | ' | ' | ' | ' |
Sales proceeds received | ' | 1,656,000 | 1,361,000 | ' | ' | 230,000,000 | 6,000,000 | ' | ' | ' |
Gain recognized | 2,925,000 | 12,938,000 | ' | ' | ' | ' | ' | 2,900,000 | 12,900,000 | ' |
Payments To Land Purchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3,100,000 |
MIAMI_LAND_AND_BUILDING_Detail1
MIAMI LAND AND BUILDING (Details 2) (Office building, Miami, USD $) | 31-May-13 |
In Millions, unless otherwise specified | |
Office building | Miami | ' |
Relocation disclosures | ' |
Initial annual base operating lease payments | $1.80 |
LONGTERM_DEBT_Details
LONG-TERM DEBT (Details) (USD $) | Sep. 29, 2013 | Dec. 30, 2012 | Dec. 18, 2012 |
Long-term debt disclosures | ' | ' | ' |
Face Value | 1,555,681,000 | ' | ' |
Carrying Value | 1,520,728,000 | 1,670,346,000 | ' |
Less current portion | ' | 83,016,000 | ' |
Total long-term debt, net of current | 1,520,728,000 | 1,587,330,000 | ' |
Unamortized discounts | 35,000,000 | 41,200,000 | ' |
9.00% senior secured notes due in 2022 | ' | ' | ' |
Long-term debt disclosures | ' | ' | ' |
Interest rate (as a percent) | 9.00% | ' | ' |
Face Value | 900,000,000 | ' | ' |
Carrying Value | 900,000,000 | 910,000,000 | ' |
11.50% senior secured notes due in 2017 | ' | ' | ' |
Long-term debt disclosures | ' | ' | ' |
Interest rate (as a percent) | 11.50% | ' | 11.50% |
Carrying Value | ' | 83,016,000 | ' |
4.625% notes due in 2014 | ' | ' | ' |
Long-term debt disclosures | ' | ' | ' |
Interest rate (as a percent) | 4.63% | ' | ' |
Face Value | 28,965,000 | ' | ' |
Carrying Value | 28,422,000 | 64,326,000 | ' |
5.750% notes due in 2017 | ' | ' | ' |
Long-term debt disclosures | ' | ' | ' |
Interest rate (as a percent) | 5.75% | ' | ' |
Face Value | 261,298,000 | ' | ' |
Carrying Value | 251,647,000 | 273,559,000 | ' |
7.150% debentures due in 2027 | ' | ' | ' |
Long-term debt disclosures | ' | ' | ' |
Interest rate (as a percent) | 7.15% | ' | ' |
Face Value | 89,188,000 | ' | ' |
Carrying Value | 83,585,000 | 83,291,000 | ' |
6.875% debentures due in 2029 | ' | ' | ' |
Long-term debt disclosures | ' | ' | ' |
Interest rate (as a percent) | 6.88% | ' | ' |
Face Value | 276,230,000 | ' | ' |
Carrying Value | 257,074,000 | $256,154,000 | ' |
LONGTERM_DEBT_Details_2
LONG-TERM DEBT (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 | Dec. 18, 2012 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 |
11.50% senior secured notes due in 2017 | 11.50% senior secured notes due in 2017 | 9.00% senior secured notes due in 2022 | 4.625% notes due in 2014 | 5.750% notes due in 2017 | |||||
Extinguishment of debt | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notes repurchased | ' | $0 | ' | $0 | ' | ' | ' | ' | ' |
Face value of notes redeemed or repurchased | ' | ' | 155,908 | 70,500 | ' | 83,595 | 10,000 | 37,473 | 24,840 |
Gain (loss) on extinguishment of debt | ($873) | ($12) | ($13,643) | $6,074 | ($94,500) | ($9,600) | ' | ' | ' |
LONGTERM_DEBT_Details_3
LONG-TERM DEBT (Details 3) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | |||||||||||||||
Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | Dec. 18, 2012 | Dec. 18, 2012 | Dec. 18, 2012 | Sep. 29, 2013 | Dec. 18, 2012 | Sep. 29, 2013 | Jul. 31, 2013 | |
Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Letter of credit | 11.50% senior secured notes due in 2017 | 11.50% senior secured notes due in 2017 | 9.00% Notes | 9.00% Notes | 9.00% Notes | |||||
Period from quarter ended March 2013 through the quarter ended December 2013 | Minimum | Maximum | LIBOR | LIBOR | LIBOR | Base rate | Base rate | Base rate | Amendment 18, December 2012 | Amendment 18, December 2012 | item | Original notes | |||||||||
Minimum | Maximum | Minimum | Maximum | ||||||||||||||||||
LONG-TERM DEBT | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $75,000,000 | $50,000,000 | ' | ' | ' | ' | ' |
Outstanding letters of credit | ' | ' | ' | ' | 41,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Draws under the credit agreement | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Variable rate basis | ' | ' | ' | ' | ' | ' | ' | ' | 'London Interbank Offered Rate | ' | ' | 'base rate | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basis spread on variable rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.75% | 4.25% | ' | 1.75% | 3.25% | ' | ' | ' | ' | ' | ' | ' |
Commitment fees for the unused revolving credit (as a percent) | ' | ' | ' | ' | ' | ' | 0.50% | 0.63% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
New borrowings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 910,000,000 | ' | ' |
Interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 11.50% | 11.50% | 9.00% | 9.00% | 9.00% |
Net proceeds from offering | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 889,000,000 | ' | ' |
Amount of debt repurchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 846,000,000 | ' | ' | ' |
Number of transactions to repurchase debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' |
Aggregate principal amount of debt redeemed | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 762,400,000 | 83,600,000 | ' | ' | ' |
Loss on extinguishment of debt | $873,000 | $12,000 | $13,643,000 | ($6,074,000) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $94,500,000 | $9,600,000 | ' | ' | ' |
Ownership percentage in each of the guarantor subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' |
Maximum consolidated leverage ratio | ' | ' | ' | ' | ' | 6 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum consolidated interest coverage ratio | ' | ' | ' | ' | 1.5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividends restricted if consolidated leverage ratio is exceeded | ' | ' | ' | ' | 5.25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
EMPLOYEE_BENEFITS_Details
EMPLOYEE BENEFITS (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 |
item | ||||
EMPLOYEE BENEFITS | ' | ' | ' | ' |
Number of new participants | ' | ' | 0 | ' |
Retirement expense for continuing operations | ' | ' | ' | ' |
Total retirement expense-net | $3,041 | $438 | $9,122 | $1,312 |
Pension plan | ' | ' | ' | ' |
Retirement expense for continuing operations | ' | ' | ' | ' |
Service cost | 1,386 | 1,385 | 4,159 | 4,155 |
Interest cost | 21,149 | 22,974 | 63,447 | 68,923 |
Expected return on plan assets | -25,263 | -26,940 | -75,790 | -80,820 |
Prior service cost amortization | 4 | 4 | 11 | 11 |
Actuarial loss | 6,389 | 3,172 | 19,168 | 9,515 |
Total retirement expense-net | 3,665 | 595 | 10,995 | 1,784 |
Post-retirement plans | ' | ' | ' | ' |
Retirement expense for continuing operations | ' | ' | ' | ' |
Total retirement expense-net | ($624) | ($157) | ($1,873) | ($472) |
EMPLOYEE_BENEFITS_Details_2
EMPLOYEE BENEFITS (Details 2) (Pension plan, USD $) | 1 Months Ended | |
In Millions, unless otherwise specified | Jan. 31, 2013 | Jan. 31, 2012 |
Pension plan | ' | ' |
Contributions and Cash Flows | ' | ' |
Value of contributions to plan | $7.50 | $40 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Details) (Revolving credit facility, USD $) | Sep. 29, 2013 |
In Millions, unless otherwise specified | |
Revolving credit facility | ' |
Additional disclosures | ' |
Outstanding letters of credit | $41.10 |
STOCK_PLANS_Details
STOCK PLANS (Details) (USD $) | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 29, 2013 | Sep. 29, 2013 | |
Maximum | RSUs | Stock options and SARs | |
RSU's | ' | ' | ' |
Nonvested at the beginning of the period (in shares) | ' | 1,102,000 | ' |
Granted (in shares) | ' | 648,150 | ' |
Vested (in shares) | ' | -485,000 | ' |
Forfeited (in shares) | ' | -24,950 | ' |
Nonvested at the end of the period (in shares) | ' | 1,240,200 | ' |
Weighted Average Grant Date Fair Value | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | ' | $2.98 | ' |
Granted (in dollars per share) | ' | $2.61 | ' |
Vested (in dollars per share) | ' | $3.72 | ' |
Forfeited (in dollars per share) | ' | $2.48 | ' |
Outstanding at the end of the period (in dollars per share) | ' | $2.50 | ' |
Additional disclosures | ' | ' | ' |
Total fair value | ' | $1,300,000 | ' |
Expected accelerated depreciation and other charges related to existing facilities and production equipment | 15,000,000 | ' | ' |
Options/SARs | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | ' | ' | 6,194,500 |
Granted (in shares) | ' | ' | 775,000 |
Exercised (in shares) | ' | ' | -522,750 |
Forfeited (in shares) | ' | ' | -44,000 |
Expired (in shares) | ' | ' | -101,750 |
Outstanding at the end of the period (in shares) | ' | ' | 6,301,000 |
Weighted Average Exercise Price | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | ' | ' | $11.45 |
Granted (in dollars per share) | ' | ' | $2.46 |
Exercised (in dollars per share) | ' | ' | $1.71 |
Forfeited (in dollars per share) | ' | ' | $3.27 |
Expired (in dollars per share) | ' | ' | $38.53 |
Outstanding at the end of the period (in dollars per share) | ' | ' | $10.77 |
Aggregate Intrinsic Value | ' | ' | ' |
Outstanding at the beginning of the period (in dollars) | ' | ' | 1,846,000 |
Exercised (in dollars) | ' | ' | 819,000 |
Outstanding at the end of the period (in dollars) | ' | ' | $1,605,000 |
STOCK_PLANS_Details_2
STOCK PLANS (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 29, 2013 | Sep. 23, 2012 | Sep. 29, 2013 | Sep. 23, 2012 |
item | ||||
Stock Plans | ' | ' | ' | ' |
Number of stock-based compensation plans | ' | ' | 5 | ' |
Stock-based compensation expense | $1,067 | $940 | $2,834 | $2,734 |
Stock appreciation rights (SARs) | ' | ' | ' | ' |
Stock Plans | ' | ' | ' | ' |
Expected life | ' | ' | '4 years 6 months 4 days | ' |
Dividend yield (as a percent) | ' | ' | ' | ' |
Volatility (as a percent) | ' | ' | 1.08% | ' |
Risk-free interest rate (as a percent) | ' | ' | 0.76% | ' |
Weighted average exercise price of SARs granted (in dollars per share) | $2.46 | ' | $2.46 | ' |
Weighted average fair value of SARs granted (in dollars per share) | $1.85 | ' | $1.85 | ' |