Exhibit 99.1
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MEREDITH CORPORATION REPORTS 15 PERCENT
THIRD QUARTER EARNINGS PER SHARE GROWTH
Strong publishing brands drive 8 percent revenue growth
DES MOINES, Iowa -- (April 19, 2000) -- Meredith Corporation (NYSE: MDP) today
reported net earnings for the fiscal 2000 third quarter ended March 31, 2000,
of $24.8 million or 47 cents per share, compared to $22.1 million or 41 cents
per share in the prior-year third quarter.
For the first three quarters of fiscal 2000, earnings were a record $68.3
million, or $1.29 per share. For the same period in fiscal 1999, earnings
before nonrecurring items were $64.9 million, or $1.20 per share. Net earnings
for the fiscal 1999 year-to-date period were $66.3 million, or $1.23 per share,
including an after-tax gain of $1.4 million, or 3 cents per share, from the
sale of the net assets of the Better Homes and Gardens Real Estate Service in
the fiscal 1999 first quarter.
Fiscal 2000 third quarter earnings before interest, taxes, depreciation and
amortization (EBITDA) increased 16 percent to $62.8 million from $54.1 million
in the prior-year quarter. For the year-to-date period, EBITDA grew 15 percent
to $179.1 million from $155.9 million in the prior-year period.
Company revenues for the fiscal 2000 third quarter grew 8 percent to $286.9
million from $265.1 million in the prior year. For the year-to-date period,
company revenues grew 6 percent to $813.5 million from $765.9 million.
Comparable third quarter and year-to-date revenues grew 8 percent and 5
percent, respectively, when adjusting for discontinued magazine titles and the
impact of the WGNX-TV (CBS, Atlanta) acquisition.
Fiscal 2000 third quarter and year-to-date earnings include dilution of 8
cents per share and 21 cents per share, respectively, from the March 1, 1999,
acquisition of the Atlanta station.
OPERATING RESULTS
Publishing
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Publishing Group operating profit and revenues increased to record levels in
the fiscal 2000 third quarter and year-to-date periods. Third quarter
operating profit grew 26 percent to $46.5 million from $37.0 million in the
prior-year quarter. For the year-to-date period, operating profit grew 23
percent, to $108.6 million from $88.6 million in fiscal 1999.
Publishing revenues grew 11 percent in the third quarter to $224.1 million,
from $202.1 million in fiscal 1999. For the year-to-date, revenues grew 5
percent to $606.9 million from $575.7 million in the prior year. Comparable
third quarter and year-to-date publishing revenues increased 12 percent and 7
percent, respectively, when adjusting for discontinued titles.
Strong fiscal 2000 third quarter and year-to-date revenues and operating
profits were reported by Better Homes and Gardens, Country Home, and
Traditional Home magazines, along with the company's lineup of Better Homes and
Gardens Special Interest Publications and its book publishing operation.
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"Our Publishing Group is performing extremely well," said Meredith Corporation
chairman and CEO William T. Kerr. "Of special note is Ladies' Home Journal
magazine. It achieved marked improvement in the third quarter, with
advertising pages up 8 percent versus the prior year, and even stronger
advertising revenue growth."
Broadcasting
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Broadcasting Group operating profit for the fiscal 2000 third quarter was $7.9
million, compared to $14.7 million in the prior year. For the year-to-date
period, operating profit was $42.7 million compared to $53.7 million in fiscal
1999.
Reported third quarter Broadcasting Group revenues were $62.9 million, compared
to $63.1 million in fiscal 1999. For the year-to-date period, reported
Broadcasting Group revenues increased 9 percent to $206.6 million from $190.1
million in the prior-year period. Without the Atlanta station, Broadcasting
Group revenues decreased 6 percent for the quarter and 1 percent for the
year-to-date period.
"Primary factors adversely affecting broadcasting performance included weak
prime time ratings for the FOX network; increased television advertising
inventory; continuing investments in the Atlanta station; and investments in
news expansion and improvement across the Group," Kerr said.
He added that revenue and operating profit growth will be priorities of Cary
Jones, Meredith's new Broadcasting Group president. Jones, who assumed his
position on March 29, brings 28 years of industry experience to the position.
"He is keenly focused on improving the group's performance," Kerr said.
Other
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Third quarter and year-to-date interest expense increased as a result of debt
related to the acquisition of the Atlanta station. Unallocated corporate
expenses declined in both the third quarter and the year-to-date periods
primarily as a result of cost containment activities.
Meredith repurchased approximately 900,000 shares of stock in the third
quarter, increasing total shares repurchased for the fiscal year to date to
nearly 1.3 million. On March 27, the company announced that its board of
directors authorized the repurchase of an additional 2 million shares through
public and private transactions.
"We've significantly accelerated our share repurchase activities," Kerr said.
"We have strong fundamentals, industry-leading brands and a well-respected
management team. At current levels, we believe buying our own stock is a smart
investment."
About Meredith Corporation
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Meredith Corporation (www.meredith.com) is one of the nation's leading media
and marketing companies with businesses centering on magazine and book
publishing, television broadcasting, and interactive and integrated marketing.
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Meredith publishes 20 subscription magazines, including Better Homes and
Gardens and Ladies' Home Journal, and more than 100 special interest
publications. Meredith owns 12 television stations -- located in fast-growing
markets such as Atlanta, Phoenix, Orlando, Portland and Las Vegas -- and
produces original television programming based on its strong brands. Meredith
has nearly 300 books in print and has established marketing relationships with
some of America's leading companies, including The Home Depot, Kraft Foods and
Nestle USA. Meredith's consumer database, which contains more than 60 million
names, is the largest domestic database among media companies and enables
magazine and television advertisers to precisely target marketing campaigns.
Additionally, Meredith has an extensive Internet presence, including branded
anchor tenant positions on America Online.
MEREDITH CORPORATION
FISCAL 2000 THIRD QUARTER AND YEAR-TO-DATE
EARNINGS PER SHARE AT A GLANCE
(Note: All figures are adjusted for stock splits)
The chart below depicts comparable quarterly and fiscal year diluted earnings
per share (EPS) before nonrecurring items and discontinued operations.
1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr. Fiscal Year
-------- -------- -------- -------- -----------
F1993 .06 .09 .10 .10 .35
F1994 .08 .13 .16 .13 .50
F1995 .14 .19 .18 .20 .71
F1996 .17 .22 .24 .28 .91
F1997 .22 .31 .33 .36 1.22
F1998 .27 .40 .37 .42 1.46
F1999 .32 .47 .41 .44 1.64
F2000 .34 .48 .47
- -- Net earnings for the fiscal 2000 third quarter ended March 31, 2000, were
47 cents per share, compared to 41 cents per share in the prior-year third
quarter.
- -- For the first three quarters of fiscal 2000, earnings were a record $1.29
per share. For the same period in fiscal 1999, earnings before
nonrecurring items were $1.20 per share. Net earnings for the fiscal 1999
year-to-date period were $1.23 per share, including an after-tax gain of
3 cents per share from the sale of the net assets of the Better Homes and
Gardens Real Estate Service in the fiscal 1999 first quarter.
- -- Fiscal 2000 third quarter and year-to-date earnings include dilution of
8 cents per share and 21 cents per share, respectively, from the March 1,
1999, acquisition of WGNX-TV (CBS, Atlanta).
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Meredith Corporation and Subsidiaries
Consolidated Statements of Earnings (Unaudited)
Three Months Nine Months
Ended March 31 Ended March 31
------------------- -------------------
2000 1999 2000 1999
- ------------------------------------------------------------------------------
(In thousands except per share)
Revenues:
Advertising $172,478 $158,141 $487,131 $451,679
Circulation 70,273 68,451 208,090 205,018
All other 44,192 38,529 118,255 109,185
-------- -------- -------- --------
Total revenues 286,943 265,121 813,476 765,882
-------- -------- -------- --------
Operating costs and expenses:
Production, distribution and edit 121,417 106,867 337,775 316,037
Selling, general & administrative 102,770 104,159 296,600 293,982
Depreciation and amortization 13,000 10,865 39,021 30,925
-------- -------- -------- --------
Total operating costs and expenses 237,187 221,891 673,396 640,944
-------- -------- -------- --------
Income from operations 49,756 43,230 140,080 124,938
Gain from disposition -- -- -- 2,375
Interest income 399 377 836 547
Interest expense (8,657) (5,328) (26,706) (13,014)
-------- -------- -------- --------
Earnings before income taxes 41,498 38,279 114,210 114,846
Income taxes 16,682 16,192 45,912 48,525
-------- -------- -------- --------
Net earnings $ 24,816 $ 22,087 $ 68,298 $ 66,321
======== ======== ======== ========
Basic earnings per share $ 0.48 $ 0.43 $ 1.32 $ 1.27
======== ======== ======== ========
Basic average shares outstanding 51,275 52,061 51,548 52,294
======== ======== ======== ========
Diluted earnings per share $ 0.47 $ 0.41 $ 1.29 $ 1.23
======== ======== ======== ========
Diluted average shares outstanding 52,621 53,598 53,099 53,880
======== ======== ======== ========
Dividends paid per share $ 0.080 $ 0.075 $ 0.230 $ 0.215
======== ======== ======== ========
See accompanying Notes to Interim Consolidated Financial Statements.
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Meredith Corporation and Subsidiaries
Segment Information (Unaudited)
Three Months Nine Months
Ended March 31 Ended March 31
------------------- -------------------
2000 1999 2000 1999
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(In thousands)
Revenues
Publishing $224,093 $202,071 $606,878 $575,745
Broadcasting 62,850 63,050 206,598 190,137
-------- -------- -------- --------
Total revenues $286,943 $265,121 $813,476 $765,882
======== ======== ======== ========
Operating Profit
Publishing $ 46,532 $ 37,020 $108,609 $ 88,601
Broadcasting 7,930 14,728 42,707 53,703
Unallocated corporate expense (4,706) (8,518) (11,236) (17,366)
-------- -------- -------- --------
Income from Operations $ 49,756 $ 43,230 $140,080 $124,938
Gain from disposition -- -- -- 2,375
Interest income 399 377 836 547
Interest expense (8,657) (5,328) (26,706) (13,014)
-------- -------- -------- --------
Earnings before income taxes 41,498 38,279 114,210 114,846
Income taxes 16,682 16,192 45,912 48,525
-------- -------- -------- --------
Net earnings * $ 24,816 $ 22,087 $ 68,298 $ 66,321
======== ======== ======== ========
Depreciation & Amortization
Publishing $ 2,894 $ 2,826 $ 8,657 $ 8,520
Broadcasting 9,596 7,581 28,784 20,960
Unallocated corporate 510 458 1,580 1,445
-------- -------- -------- --------
Total depreciation & amortization $ 13,000 $ 10,865 $ 39,021 $ 30,925
======== ======== ======== ========
EBITDA
Publishing $ 49,426 $ 39,846 $117,266 $ 97,121
Broadcasting 17,526 22,309 71,491 74,663
Unallocated corporate (4,196) (8,060) (9,656) (15,921)
-------- -------- -------- --------
Total EBITDA $ 62,756 $ 54,095 $179,101 $155,863
======== ======== ======== ========
* Note: Net earnings for the nine months ended March 31, 1999 included a post-
tax gain of $1.4 million, or 3 cents per share from the sale of the net
assets of the Better Homes and Gardens Real Estate Service.
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