1999 ANNUAL REPORT
GANNETT C O. , I N C.
FINANCIAL SUMMARY•1999 AT A GLANCE
In thousands, except per share amounts 90 $3170
1999 91 $3122
Operating revenues $4,880,691 7.8%
Operating income 1,385,814 12.8%
Income from continuing 95 $3726
operations before 96 $4189
non-recurring gains (1) 782,818 13.3%
Net non-operating gains 183,607 —
32,780 98 $4881
continuing operations 966,425 (4.9%)
919,387 Operating revenues in millions
Earnings from discontinued
operations, net 33,488 15.1%
Net income 999,913 (4.2%)
957,928 91 $292
Income per share from 92 $341
continuing operations before 93 $389
non-recurring gains – diluted (1) 2.74 14.9%
Income per share from net 95 $457
non-operating gains – diluted 0.64 —
0.11 96 $503
Income per share from 97 $681
continuing operations – diluted 3.38 (3.5%)
3.26 98 $782
Income per share from
discontinued operations – diluted 0.14 Income from continuing operations before net non-operating gains, in millions
Net income per share – diluted 3.50 (2.8%)
Operating cash flow (2) 1,639,277 12.4%
1,843,192 90 $1.10
Working capital $ 178,418 7.3%
$ 191,444 93 $1.32
Long-term debt 1,306,859 88.5%
Total assets 6,979,480 29.0%
Capital expenditures (3) 220,449 8.6%
239,438 97 $2.39
Shareholders’ equity 3,979,824 16.3%
Dividends per share .78 5.1%
Income per share (diluted) from continuing operations before net non-operating gains
shares outstanding – diluted 285,711 (1.4%)
(1) Excluding a 1999 net non-operating gain principally from the exchange of KVUE-TV
in Austin, Texas, for KXTV-TV in Sacramento, Calif., totaling $55 million pre-tax
and $33 million after tax ($.11 per share-basic and diluted) and a 1998 net non-
operating gain principally from the disposition of several businesses, including
radio and alarm security, totaling $307 million pre-tax and $184 million after tax
($.65 per share–basic and $.64 per share – diluted).
(2) Represents operating income plus depreciation and amortization of intangible assets.
(3) Excluding capitalized interest and discontinued operations.
C O M P A N Y P R O F I L E : Gannett Co., Inc. is a diversified news and information company that publishes newspapers, operates broadcasting stations and is
engaged in marketing, commercial printing, a newswire service, data services and news programming. Gannett is an international company with headquarters
TA B L E O F C O N T E N T S
in Arlington, Va., and operations in 45 states, the District of Columbia, Guam, England, Germany and Hong Kong.
Gannett is the USA’s largest newspaper group in terms of circulation. The company’s 74 U.S. daily newspapers have a combined daily paid circulation of
6.6 million. They include USA TODAY, the nation’s largest-selling daily newspaper, with a circulation of approximately 2.3 million. In addition, Gannett owns a
variety of non-daily publications, and USA WEEKEND, a weekly newspaper magazine.
Newsquest plc, a wholly owned Gannett subsidiary acquired in mid-1999, is one of the largest regional newspaper publishers in England with a portfolio of
180 titles. Its publications include 11 daily newspapers with a combined circulation of approximately 450,000. Newsquest also publishes a variety of non-daily
publications, including Berrow’s Worcester Journal, the oldest continuously published newspaper in the world.
The company owns and operates 21 television stations covering 17.4 percent of the USA.
Gannett was founded by Frank E. Gannett and associates in 1906 and incorporated in 1923. The company went public in 1967. Its more than 278 million
shares of common stock are held by approximately 14,000 shareholders of record in all 50 states and several foreign countries. The company has approxi-
mately 45,800 employees.
2 LETTER TO SHAREHOLDERS
10 NEWSQUEST PLC
12 USA TODAY
16 BOARD OF DIRECTORS
18 COMPANY AND DIVISIONAL OFFICERS
21 FINANCIALS TABLE OF CONTENTS
70 MARKETS WE SERVE
76 GLOSSARY OF FINANCIAL TERMS
77 GANNETT SHAREHOLDER SERVICES
Gannett ended the second millennium with a great performance: 1999 was our eighth consecutive year
of record revenues and profits.
Our newspapers led the way, helped by the longest economic expansion in history. Gannett’s revenues
increased 8 percent to almost $5.3 billion and earnings advanced 13 percent to approximately $886
million. Our operating cash flow increased 12 percent to $1.84 billion, another record level. Behind the
success was strong advertising demand at all the papers, a smart acquisition overseas and lower
newsprint prices. And USA TODAY had record operating results. Not included is a one-time gain from the
exchange of our ABC affiliate in the smaller Austin, Texas, market for the ABC affiliate in Sacramento, Calif.,
the number 20 television market, and cash.
Also excluded are the contributions of the Cable Division, which was sold on Jan. 31, 2000 to Cox
Gannett Chairman and CEO John J. Curley (left) and Vice Chairman and President Douglas H. McCorkindale
Communications for approximately $2.7 billion in cash or about $5,200 per subscriber, the upper end of
the price range for cable.
Cable was part of the Multimedia acquisition, a deal that exceeded our expectations over the years.
We paid $2.3 billion for all of Multimedia in 1995 and, since then, sold the entertainment, security and
cable divisions plus a few small properties for a total of $3 billion. We still own all of the significant news-
papers and television stations that were part of the deal – and Multimedia added to our earnings in every
quarter we owned it.
Gannett’s strategic focus continues to be on using our substantial cash flow to create and expand
quality products and to make acquisitions in the news, information and related fields. In 1999, we made
a number of smart investments consistent with those goals.
LETTER TO SHAREHOLDERS
“Our newspapers were
record earners in 1999,
benefiting from strong
advertising demand –
particularly in classified and
national – and newsprint
expenses that declined
6 percent for the year.”
In July, we completed the In November, we reached launch the remainder of the
acquisition of Newsquest plc, an agreement to purchase a small-market newspaper sites.
one of the largest regional small television station, The Internet is a challenge
newspaper publishers in WJXX in Jacksonville, Fla., and an exciting opportunity
England. At about $1.7 bil- where we already own the for our community newspa-
lion, the deal was Gannett’s NBC affiliate, WTLV. A loos- pers to extend their brand,
most significant overseas ening of several broadcast generate revenue and,
transaction ever. In Newsquest, ownership regulations by the ultimately, profits. Our
under the leadership of Jim Federal Communications newspapers will continue to
Brown, we found a group of Commission, including new use the Internet to leverage
high-quality properties, duopoly rules, makes it those important local brands,
managed by superb people possible for us to acquire and enhance the strong
who share our culture of that second station. But the relationships we already
innovation and financial cross-ownership rule, left enjoy with our readers and
discipline. unchanged by the FCC, still advertisers in the communi-
Newsquest’s focus, like bars Gannett from owning ties we serve. And our Web
ours, is on providing local newspapers and broadcast sites are attracting visitors
news and information through properties in the same market. who are not readers and are
valued, trusted products that While some members of generating subscriptions for
satisfy the needs of their Congress seem willing to level our print products.
communities. Newsquest also the playing field, the FCC As the most visited
was the first regional newspa- isn’t budging. general news site on the Web,
per group to launch a Web The business of the USATODAY.com solidified
site in the United Kingdom. Internet was the business of its position in 1999 as an
It has expanded its Internet Gannett in 1999. The number Internet leader. Over the year,
efforts through a number of of our domestic newspaper content was enhanced and
individual and industrywide Web sites grew to 60 over multimedia coverage was
initiatives and is well-posi- the year and we more than added. Advertising revenue
tioned to capitalize on these doubled the products we and e-commerce sponsor-
opportunities. Because of the offer online to 480-plus. ships exploded in 1999 and
company’s good operating These products include news USATODAY.com made a
performance, and lower-than- sites, rich classified verticals, profit for the entire year –
anticipated interest rates, community-oriented sites almost unheard of in the
Newsquest added to earnings and numerous specialty sites dot.com world.
Our broadcast group
in 1999. We believe it’s very based on the unique charac-
launched new media activities
unusual for an acquisition of teristics of the individual
through Web sites in 13 of our
this size to enhance earnings markets. In 2000, we intend
television markets in 1999.
so quickly. to add more products and
Each of our major stations has The Newspaper Division
GANNETT’S BASIC GAME PLAN
made significant progress in published the Principles of
creating a new business around Ethical Conduct for
Gannett is an international $5.3 billion news, information and
its Web activities and we plan Newsrooms, continuing
to have Web sites in all our TV Gannett’s leadership role in
We operate with the belief that improving products and sound
markets in 2000. demanding proper press
management will lead to higher profits for our shareholders.
Overall, Gannett generated conduct and high ethical
The underlying theme in our ads is: “A world of different voices
about $40 million in revenue standards in news gathering.
where freedom speaks.”
in 1999 from Internet activi- While the world of news and
Our assets include:
ties, with a minimal loss. information explodes, our
• USA TODAY;
Gannett stock became one goal is to stay ahead of the
• Daily and weekly community newspapers and specialty
of our smart investments in pack while building credibility
1999. In late August, we with readers.
• Television stations in many Top 25 and growth markets;
activated our share repurchase The strategy made for good
• Online news, information and advertising.
program and bought almost journalism and good business.
2.4 million shares at a total Readership was up in
cost of about $163 million for 1999, proving value should
• Create and expand quality products through innovation;
the year. Early in 2000, we be measured by the number
• Make acquisitions in news, information and communications and
believed that our stock price of people who read a newspa-
related fields that make strategic and economic sense.
did not reflect the underlying per, not solely by the number
value and strength of our who buy it. Increasingly, the
• Provide effective leadership and efficient management;
businesses and decided to industry and the advertising
• Achieve a positive return on new and acquired products and
repurchase additional stock. world are taking notice, and
properties in a reasonable period of time, while recognizing those
Subsequently, the Board studies of readership are
with high growth potential may take more time;
approved another $500 million underway, both at Gannett
• Increase profitability and increase return on equity and investment
authorization. On February 23, and nationally.
over the long term;
having used a substantial por- Our newspapers were
• Enhance the quality and editorial integrity of our products,
tion of that authorization, the record earners in 1999,
recognizing that quality products ultimately lead to higher profits;
Board approved an additional benefiting from strong adver-
• Guarantee respect for and fairness in dealing with employees;
$500 million for purchases of tising demand – particularly
• Offer a diverse environment where opportunity is based on merit;
Gannett stock. in classified and national –
• Show commitment and service to communities where we do
Even while taking advan- and newsprint expenses that
tage of international expansion declined 6 percent for the
• Deliver customer satisfaction;
opportunities, Gannett’s year. We also enjoyed another
• Dispose of assets that have limited or no potential or where an
sights in 1999 remained year of profit improvement at
offer has been made that the Board of Directors believes is in the
focused on credibility and The Detroit News, our New
best interest of the shareholders;
dedicated to local news and Jersey properties and USA
• In all activities, we show respect for the First Amendment and our
our communities. WEEKEND. And while
responsibility to it.
LETTER TO SHAREHOLDERS
newsprint prices will increase to bring news and informa- spending should improve Above: Newsquest Executive
in 2000, we don’t expect tion to the newspaper and revenues and earnings in 2000 Chairman James Brown (right)
market conditions to result in USATODAY.com. while our stations take advan- and Douglas McCorkindale, when
substantially higher prices for Programs expanding read- tage of the opportunities to the acquisition of Newsquest was
publishers. ership, such as USA TODAY’s attract new viewers and grow announced in 1999.
USA TODAY had its best innovative plan to attract our core product: local news.
year ever and is the nation’s college students, will continue And investments in technology
largest selling daily newspaper to broaden its reach with will continue as we move
with readership at 5.4 million important new audiences. deeper into the digital age.
and average circulation of And the new year will bring But whether we’re talking
approximately 2.3 million the first significant redesign in about core products or
copies per day reported by USA TODAY’s 17-year history. technology-driven expansions,
the Audit Bureau of 1999 was a challenging our smartest investments are
Circulations. Advertising year for our television sta- still our employees. That’s
revenues grew 17 percent as tions. The absence of major why 1999 saw us stress, at
several of the paper’s largest special events on our stations corporate and in the field,
ad categories experienced – the Super Bowl, Winter recruiting and retaining
double digit growth. Dot.com Olympics and strong election talent. “Grow Your Own” is
advertising added to the spending, all of which an important objective at
boom: USA TODAY led all bolstered results in 1998 – Gannett.
major print publications in made for difficult comparisons As we enter the 21st
the share of paid dot.com in 1999. With the trade of century, we will continue to
advertising pages. our Austin, Texas, station for expand our traditional
Looking ahead for USA one in Sacramento, our 21 businesses, explore new
TODAY, 2000 is an election stations covered 17.4 percent opportunities and enhance
and an Olympics year, of U.S. households. our values. And in that
We expect to close on the
promising a boost in ad process, we will always work
second Jacksonville station in
spending. Internet brand- to meet the needs of the
the first half of 2000.
building will continue as we communities we serve. That’s
Olympics and election ad
take advantage of our solid the smart thing to do.
foundation and seek out new
opportunities. In 2000,
Division will join with USA
TODAY to bring content from
Douglas H. McCorkindale
John J. Curley
The Nation’s Newspaper to
Vice Chairman and President
our TV stations, and to make
Chief Executive Officer
use of our stations’ resources
Record revenues and record operating profits spurred by continued growth in
classified ads and a strong performance in national advertising marked 1999 for
Gannett’s U.S. Newspaper Division.
The division’s 73 community newspapers sold an average of 1,130 more ads
per day in 1999 than in 1998, reflecting the newspapers’ successes in selling to
a larger number of smaller advertisers. Total pro forma advertising revenues
increased more than 4 percent in 1999; run-of-press volume increased almost
5 percent. Operating profits increased at most of the newspapers.
Classified revenues increased 7 percent over 1998. Key growth areas in
classified included employment, automotive and real estate.
At USA WEEKEND, strong ad categories included retail and pharmaceuticals.
For USA WEEKEND’s Make A Difference Day, Nashville AmeriCorps volunteers clean up a
blighted block where the Salvation Army Adult Rehabilitation Center helps drug addicts.
The weekly newspaper magazine also saw an increase in technology business,
including ads for dot.coms, which grew substantially to $3.3 million.
In 1999, USA WEEKEND revamped its design and content with an eye to
capturing a larger share of readers ages 25-44. USA WEEKEND remains the
nation’s fastest growing newspaper magazine. (See story, page 7).
Gannett newspapers’ daily and Sunday net paid circulation were down
slightly, with circulation revenue closing 1 percent lower. Net paid circulation,
however, doesn’t tell the whole story. Research indicates overall readership,
(continued on page 8)
1 9 9 9 N E W S PA P E R S
1998. The addition of the USA WEEKEND and the
MAKING A DIFFERENCE Above: As part of its credibility
Two million people – more Sunday San Francisco Freedom Forum’s Newseum. effort, FLORIDA TODAY at Brevard
than ever before – participated Examiner and Chronicle put Readers reacted to the County published a column
in USA WEEKEND’s annual USA WEEKEND into another magazine’s reporting efforts, inviting readers to volunteer
Make A Difference Day in Top 10 market. too. The Federal Emergency as proofreaders. About 100
October 1999, turning the Advertising finished the year Management Agency asked to responded. Periodically, several
event into the nation’s largest well ahead of expectations, says reprint a December story, “Is dozen are invited to come to
day of volunteering. USA WEEKEND President, Your House Killing You?,” on the newspaper office and proof
Celebrities, including Miss CEO and Editor Marcia the deadly effects of mold. the paper on deadline. They and
America Heather French, Bullard. The retail category The article will be distributed others proof from home, sending
country-music superstar Reba grew 87 percent over 1998, to relief workers and flood the newspaper e-mails when they
McEntire, boxer George with much of that business victims. Major newspapers and see mistakes. From left, commu-
Foreman and NASCAR driver from Sears, Roebuck and Co. TV news shows picked up the nity proofreaders Gene Cate,
Tony Stewart, joined govern- The pharmaceutical category story. One woman told the Sharon Kelly, Bill Powell and
ment officials, charitable recovered from a severe drop in editors she felt the article had Marge Bell look for misspellings
leaders and citizens of all 50 advertising in 1998, increasing saved her life. and factual errors on proofs.
states in donating time and 32 percent.
raising money. During the year, USA ETHICS TOPPED
Partnerships with WEEKEND revamped its look NEWSPAPERS’ AGENDA
Newman’s Own and the and content, adding more In 1999, Gannett set out
Wal-Mart Foundation, along health, technology, personal detailed guidelines on ethics
with the Gannett Foundation, finance and food stories. for its newsrooms. The
contributed to $2.6 million in Coverage of entertainment and Newspaper Division’s
charitable grants for projects. popular culture continued. Principles of Ethical Conduct
Since 1992 when USA WEEK- More than 500,000 garnered the immediate
END, in partnership with the readers responded to USA attention of readers and other
Points of Light Foundation, WEEKEND’s polls and members of the media.
created Make A Difference quizzes, many via the Division President Gary
Day, more than eight million magazine’s online site Watson says several factors
people have participated. (www.usaweekend.com). prompted creation of the
That was just one of many Nearly 200,000 students principles: a desire to support
high points for the weekly participated in the 12th strong but honorable investiga-
newspaper magazine in 1999. Annual Teen Survey, conduct- tive reporting; a deep concern
Circulation grew for the ed with the in-classroom TV over public distrust of the
13th consecutive year, show Channel One. Some media; and a need to address
reaching 21.8 million in 563 36,000 people voted in a the increase in lawsuits
newspapers, up from 21.2 “Stories of the Century” focusing on news-gathering
million in 541 newspapers in survey, sponsored jointly by (continued on page 9)
paid circulation plus pass-along readership, has grown industrywide and for
Gannett community newspapers in the past decade. In an effort to better reflect
the actual number of readers, 12 Gannett newspapers published readership
audits in 1999 conducted by the Audit Bureau of Circulations.
On the Internet, 1999 was a year for expansion both of content and product
lines for the community newspapers. Revenue from online operations in the
fourth quarter of 1999 was more than triple the amount for the first quarter of
1998. Traffic is now in excess of 50 million page views per month. The number
of products has doubled to more than 480. The division’s goal for 2000 is to
launch online sites for the remaining Gannett dailies.
Among the division’s smart choices in 1999 was publication by the division
(continued from page 6)
of the Principles of Ethical Conduct for Newsrooms, giving reporters and
editors a comprehensive guide to ethical and effective methods of news
gathering. Training on the guidelines was conducted at Gannett newspapers
throughout the year. (See story, page 7.)
Gannett newspapers also began the conversion from a 54-inch web width to
a 50-inch web. The narrower page makes newspapers easier to carry, hold and
fold – and reduces newsprint expense. Eight daily newspapers switched in 1999.
More than 50 newspapers and offset print sites will have converted to the
narrower web width by the end of 2000.
Installation of the Gannett-developed Genesys software, which provides a
universal customer database to our newspapers’ circulation and advertising
departments, was completed, closing out the three-year development and
Regionally, Gannett papers made smart moves that increased circulation.
The Des Moines Register and the Iowa City Press-Citizen began jointly pro-
ducing a new Sunday edition. The Johnson County edition of The Sunday
Register, which includes a 24-32 page wrap produced by the Press-Citizen, is
distributed throughout the Iowa City/Johnson County, Iowa, area. This new prod-
uct resulted in increased paid circulation for the Sunday Des Moines Register
and ad revenues for the Press-Citizen.
And the St. Cloud (Minn.) Times converted its weekday edition to morning
publication and introduced a number of content improvements. An immediate
circulation gain was the result.
For more on the Newspaper Division’s financial performance, see page 25.
1 9 9 9 N E W S PA P E R S
methods and not on the truth newspapers and offer new Ventures’ Cars.com, Above left: Des Moines Register
of stories. products and services. Apartments.com and Publisher Barbara Henry and Iowa
About 5,000 Gannett jour- More newspapers switched Newhomenetwork.com. City Press-Citizen Publisher
nalists went through a training to an all-digital work flow, Early in the year, Chuck Wanninger hold their
program on the principles allowing for later editorial Gannett Media Technologies jointly produced Sunday
during the year. The guidelines deadlines and more timely International launched Celebro edition, the Johnson County
are being shared with the content. The process uses CityServer software designed to edition of The Sunday Register.
public through the newspapers state-of-the-art tools such as help newspapers and other
and in public presentations: digital cameras, remote image media build and maintain Above right: Gannett Media
• The Burlington (Vt.) Free scanners, flatbed scanners for online city guides. The software Technologies International
Press engaged readers in a camera-ready material, cellular debuted at The Desert Sun at President and CEO Dan ZIto
six-week dialogue on ethics modems, page layout software Palm Springs, Calif., FLORIDA demonstrates the effectiveness
in its Sunday Forum section and direct-to-plate imaging. TODAY at Brevard County, the of Celebro CityServer software.
and later on public radio. Going digital has helped Montgomery (Ala.) Advertiser
• The Montgomery (Ala.) newspapers solidify their and a non-Gannett newspaper
Advertiser now has a tele- position as the repository for in Pottsville, Pa. Later,
phone hot line and a daily local news and information in Wilmington, Del., Louisville,
“report card” in coupon their communities. Ky., Cincinnati, Des Moines,
form inviting readers to rate Using the new technolo- Iowa, Cherry Hill, N.J., and
it on accuracy and other gies, newspapers now can use El Paso, Texas, installed the
credibility issues. stories, graphics and ads in a product.
• The Herald-Dispatch at variety of ways, including CityServer converts
Huntington, W. Va., putting them on the Internet. newspaper content into online
impaneled a reader advisory Most newspapers with Web information and also allows
group to bring issues of presences enhanced their on- newspapers to easily manage
accuracy and credibility line classifieds and their reach the flow from Web pages into
directly to the editor. Other with links to nationwide ser- print media. It offers news-
newspapers appointed read- vices and specialty products. papers an easy-to-customize
er representatives to help The goal: to give consumers format for producing real
explain their journalistic more information online while estate, automotive, dining,
processes and respond to helping them search for cars, movie and community event
reader concerns. apartments, homes, jobs and guides and directories.
more. While it has the potential
Online classified products for sales outside of Gannett,
TECHNOLOGY ON TARGET
Gannett took advantage of run the gamut from local com- its development will save the
technology and the opportuni- munity efforts to nationally company the cost of software
ties offered by the Internet to branded sites such as licensing fees from outside
improve the community CareerPath.com and Classified vendors.
Gannett made a smart choice in July when it acquired Newsquest plc, says the British company’s Executive
Chairman James Brown. “It is a fine company and there’s no doubt, in my view, that Gannett got a bargain.”
Newsquest is one of the largest regional newspaper publishers in England, with 180 publications including
11 dailies. The purchase expands Gannett’s international reach, giving the company a major foothold in the
About one-third of Newsquest’s newspapers are more than 100 years old. Berrow’s Worcester Journal,
established in 1690, is the oldest continuously published newspaper in the world. While maintaining this fine
tradition, Newsquest has been a leader in expanding into new lines of Web-based products and technology. In
1995, Newsquest was the first regional newspaper group in the U.K. to launch a Web site. Since then it has con-
tinued to build its Web-based strategy, skill base and knowledge, with every Newsquest newspaper having an
Internet presence. In 1999, it pioneered a new e-commerce service called Shoppers World. (See story, page 11.)
York town crier John Redpath catches up on what’s happening in Britain’s Evening Press.
Newsquest also publishes lifestyle and business magazines, local information guides and seasonal publica-
tions. In 1999, new launches included Limited Edition, a glossy, high-quality lifestyle magazine, local business
news magazines and a guide to local Web sites.
Newspapers and magazines are not the only products offered by Newsquest. In 1999, the company
expanded a service that now books more than 100,000 people a year on vacations, trips to the theater and other
leisure pursuits. (See story, page 11.) The year also saw an extension of the range of local exhibitions organized
by Newsquest, including auto and bridal shows and job and technology fairs.
Meanwhile, quality remains a top priority. Among the honors bestowed in 1999: The Westmorland Gazette
was named Weekly Newspaper of the Year by the U.K. Press Gazette, a journalism publication.
For more on Newsquest’s financial performance, see page 25.
1999 NEWSQUEST PLC
service sites – Fish4homes, service in return for advertising
NEWSQUEST EXPANDS Above left: Newsquest’s popular
Fish4jobs and Fish4cars. The in Newsquest’s regional news-
INTERNET PRESENCE “Reader Holidays” service helps
Newsquest has a reputation for Fish4it! online directory service papers and cash. customers book vacations to far-
being at the forefront of Internet features 1.9 million businesses. flung locations around the world
development in the United Users can search nationally or — and to places closer to home,
Kingdom. narrow down to the most local such as to the Aldwych Theatre in
A HIT WITH READERS
In 1999, Newsquest level. Newsquest continued expan- London’s West End.
teamed with other leading Newsquest further enhanced sion of its successful reader
U.K. publishers and converted the sites by creating community vacation service in 1999 by Above right: Newsquest partners
its news sites into “digital pages which organizations, offering an even wider range of with other regional publishers
communities.” The network of clubs and associations can man- packages to different locations to group their online classified
“This is …” Web sites embraces age and update remotely. Using around the globe. advertising under the Fish4
not only the traditional commu- this service, schools are begin- Through Newsquest news- brand.
nity within the circulation area ning to build their own sites papers, more than 100,000
of the newspapers but also new within the local “This is …” people in 1999 booked “Reader
forms of community defined by site. Sponsors already have Holidays” to dozens of local,
interest group, hobby, sports committed to the initiative. regional and international
team affiliation or other means. To answer local business destinations, ranging from a
A national portal site also people’s concerns about the Valentine’s Weekend in Paris to
was developed with several threat of e-commerce, 11 days of sightseeing in China
partners. “This is Britain” brings Newsquest in 1999 pioneered and Hong Kong.
together news and sports, a new service called Shoppers Also offered: cruises, travel
allowing users to access major World. More than 160 shops packages to special events
national resources as well as and businesses – with well and day trips to shows and
specific local information. over 4,000 items for sale – concerts, usually in the West
Through this network of sites, have jumped onboard, and the End of London.
Newsquest has succeeded in number is growing. In 1999, many Newsquest
covering most of the U.K. The formation in 1999 of a newspapers placed links
The sites’ online classified separate division, Newsquest to “Reader Holidays” on
service, ADHunter U.K., which Digital Media, provides addi- their Web sites, which are prov-
Newsquest helped found, was tional focus to Internet-related ing popular. Now those inter-
relaunched and renamed developments. ested in booking a vacation
“Fish4” in September 1999. In early 2000, Newsquest online can learn more about
Several leading regional made a strategic investment in Newsquest’s program, access a
publishers group their classified Freeserve Auctions. Newsquest database of destinations and
advertising on the Internet acquired 10 percent of the services and begin booking
under the Fish4 banner, bring- person-to-person and merchant- their vacation without lifting
ing together three major online to-person online auction the phone.
Advertising success marked 1999 for USA TODAY. From the launch of the front page color ad (see story, page 13)
to capitalizing on the economic boom, the nation’s newspaper made one smart move after another.
Ad revenues for the year grew 17 percent, the number of ad pages increased 13 percent and the scope of the ads
broadened. USA TODAY also led all major publications in paid dot.com advertising and a 38 percent increase in
international revenue was logged.
Growth was the word in circulation as well, despite the challenges of stiffer competition, earlier rush hours and
heavier traffic. The paper registered its 17th annual increase in average daily circulation. An innovative readership
program brought USA TODAY to 160 college campuses in 1999, with more in line for 2000.
Under new Editor Karen Jurgensen, editorial introduced a stock index, the Internet 100, and increased coverage of
the “e-world.” A “Readers’ Bill of Rights,” accuracy surveys and stepped-up training of editors and reporters honed skills.
Breaking news remained the biggest driver of traffic on USATODAY.com. Nearly 15 million different people per month
USA T O DAY
USA TODAY is offered to students in U.S. college and residence halls, such as at George Washington University in Washington, D.C.
were clicking on the site by year’s end, a 79 percent increase over 1998. Revenues were up 89 percent, making the site
one of the few media money-makers on the Web.
Technological advances in 1999 allowed production of USA TODAY to be totally digital. Installations of a new editing
system and a single-copy sales and distribution system were completed successfully. Arriving in the year 2000 will be
computer-to-plate technology that will provide newsrooms with later deadlines and readers with earlier delivery times.
Other developments in 2000: Five print sites will be added in Lansing, Mich., Las Vegas, Raleigh, N.C., and in Belgium
and Italy. The year also will bring the first significant redesign in USA TODAY’s history as the paper moves from a
54-inch to a 50-inch web width. And USATODAY.com will work with Gannett Broadcasting to bring USA TODAY content
to Gannett TV station newscasts.
For more on USA TODAY’s financial performance, see page 25.
1 9 9 9 U S A T O D AY
among the five, is using its exclusive announcement of the
FRONT PAGE OPENS TO ADS Above left: USA TODAY began
USA TODAY broke away from front page space to promote Rawlings Gold Glove Awards, publishing front-page ads in
the U.S. newspaper pack in its consumer, business and given annually for outstanding October. Advertisers jumped at
October when it began wireless services and fielding achievement at each the chance to buy space.
publishing display ads along products. position in the American and
the bottom of Page One. “We’re always looking to National Leagues. For years, Above right: Top prospects Red
Five marquee advertisers create unique and unprece- The Sporting News had been Sox catcher Steve Lomasney and
quickly committed to the dented impact and doing it in tied to the event. “To get this Texas Ranger pitcher Matt Miller
nearly one-inch-deep space, new and efficient ways,” says deal is a coup for us and a catch up on the news in USA
says Carolyn Bivens, senior Stephen Graham, AT&T vice tribute to Baseball Weekly’s TODAY Baseball Weekly before a
vice president/advertising and president/marketing communi- presence among baseball fans 1999 Arizona Fall League game.
associate publisher. cations worldwide. “We like and within the business of
Cost is $1 million a year for USA TODAY. Its target audience baseball,” Cutler says.
a once-a-week placement is terrific. It’s a national publi- Readers also found impor-
Monday through Thursday and cation providing immediacy tant enterprise efforts. The
$1.2 million a year for Friday, and currency.” paper was the first to report
when circulation is higher. Each that St. Louis Cardinals slugger
advertiser took one day a week Mark McGwire had stopped
BASEBALL FANS GET
for at least a year. taking a muscle enhancer. It
MORE OF THE GAME
Editor Karen Jurgensen USA TODAY Baseball Weekly followed San Francisco Giants’
concurred with the decision. had its best year ever, with Pat Dobson for a week, giving
“We’ve run ads on the inside advertising and circulation readers a first-hand look at
section fronts for years and ads revenues at all-time highs. The the job of an advance scout.
on front pages are standard in publication, 9 years old this For its “Top 100 Players of
other countries.” April, secured new multi-year the Century” list, it asked
The front page ads partnerships with several the Society for American
don’t encroach on editorial high-profile advertisers in Baseball Research to poll its
space because USA TODAY 1999. Major League Baseball 700-plus members, with
already had been using that sponsors the color ad located results exclusively for Baseball
space to promote first its on Page 3, “a key position, Weekly’s use. The list gener-
Olympics coverage and later comparable to USA TODAY’s ated the most letters to the
USATODAY.com. Nor are ‘window’ ads,” says Publisher editor in Baseball Weekly’s
readers apt to confuse the ads Keith Cutler. CBS SportsLine history.
with stories. “They can tell sponsors the Fantasy Insider This spring, the publication
the difference between advertis- column. will beef up its Internet
ing and editorial content,” Another deal with Rawlings presence with an enhanced
Jurgensen says. Sporting Goods allows Baseball and interactive Web site called
AT&T, the Tuesday advertiser Weekly to make the first totalbaseballweekly.com.
Swapping the Austin, Texas, TV station for cash and KXTV-TV in Sacramento, Calif., a significantly larger market,
was just one of the Broadcasting Division’s strategic moves in 1999. Another: the agreement to buy WJXX-TV in
Jacksonville, Fla. The deal giving the company a second station in the community was announced on the day federal
regulations changed to allow such duopolies.
Gannett remained a leader in its core product – local news. Six Gannett stations were consistently No. 1 in news in
their markets for viewers between the key ages of 25-54: KARE-TV at Minneapolis-St. Paul, KSDK-TV at St. Louis,
WMAZ-TV at Macon, Ga., KUSA-TV at Denver, WBIR-TV at Knoxville and WCSH-TV at Portland, Maine.
Quality local programming at Gannett stations also attracted industrywide recognition in 1999. Jacksonville’s
WTLV-TV, Washington, D.C.’s WUSA-TV and KARE-TV were winners of four prestigious national 1999 Edward R. Murrow
Awards. KARE’s “Whatever,” a weekly magazine show for teenagers, won the National Association of Broadcasters’
first Education Foundation Service to America Award. The station also won two Iris Awards from the National
KARE-TV woos young viewers with an award-winning weekly news program about “Whatever.” Series producer Erin Zdechlik is
pictured on the set with some of the show’s teen anchors.
Association of Television Program Executives.
Revenues were up 1 percent in 1999. The absence of the Super Bowl on NBC affiliates, no Winter Olympics on CBS
affiliates and lack of significant political advertising, all of which bolstered revenues in 1998, made for a challenging
1999 and shifted the stations’ business development efforts into high gear. Dot.coms emerged as a new source of
revenue in high Internet penetration areas such as Washington, D.C., Atlanta, Denver, Minneapolis and Sacramento.
Interactive Web sites served 13 markets. The stations used the Internet to enhance their brands, extend their
products and create new business around their Web activities. In 2000, Broadcasting will be expanding its Web
presence in all the markets and will maximize the opportunities that an election/Olympics year provides.
For more on the Broadcasting Division’s financial performance, see page 28.
from “Experience Today.” The to cover them for their markets,
BUFFALO TV TEAMS UP Above left: Every weekday
station’s weekly public affairs other Gannett stations, the
WITH USA TODAY morning WGRZ’s “Daybreak”
program, “Common Ground,” networks and the world.
ON EDUCATION INITIATIVE anchors Pete Gallivan and
Buffalo, N.Y.’s WGRZ-TV went also discusses the story. • KARE-TV at Minneapolis-St. Maryalice Demler tell Buffalo
to school this September, “Kids hear about news in the Paul was in the forefront of viewers what’s in USA TODAY.
joining with USA TODAY, morning on TV, then in school. broadcast coverage of
USATODAY.com and local They learn what critical informa- Minnesota Gov. Jesse Above right: Gannett TV stations
career college Bryant & Stratton tion is and how it applies in real Ventura’s first year in office, led their markets in broadcasting
in a project designed to educate life. When they get home and feeding stories to NBC and major news stories. Denver’s
area children and their parents parents ask, ‘What did you learn to other Gannett stations. KUSA provided hours of live,
about news events. in school today?,’ they have “The appetite for Ventura continuous coverage of the
“Experience Today” brings something to talk about,” says news was insatiable,” says Columbine High School shootings.
the power of TV, the newspaper Darryll Green, president and News Director Tom Lindner.
and the Internet to middle and general manager at WGRZ. • The horror of the Columbine
high school students in public Not only do kids discover what’s school shootings was
and private schools in Western going on in the world, he says, captured in April by Denver’s
New York. The pilot project is but they learn to communicate KUSA-TV, which led the
named after USA TODAY’s with their parents – and vice market in coverage.
educational lesson plan, a versa. • Also in April, Atlanta’s
program the paper began in Before the collaboration, WXIA-TV was the first
schools in 1983. The lesson USA TODAY’s “Experience to report that a workman
plan is delivered daily with the Today” was in about 100 class- was trapped atop a construc-
newspaper to classrooms. rooms in the region. WGRZ’s tion crane above a raging
How adding TV to project added another 80. More fire. Viewers watched the
“Experience Today” works: are expected. station’s live coverage for two
Every morning the anchors on Says Green: “We’re building hours until the worker was
WGRZ’s “Daybreak” show customer loyalty. We’re hoping rescued by a heroic Atlanta
discuss stories that are in that that watching us and reading firefighter dangling from a
day’s USA TODAY. In school, USA TODAY will become a helicopter.
teachers incorporate the stories habit for kids so that they’ll • In June, WXIA provided
into the curriculum. Then watch and read us as adults, the first video and nearly
the students are guided to too.” eight hours of continuous
USATODAY.com and Bryant & coverage when a day trader,
Stratton’s Web site for additional upset over stock market
TV STATIONS TAKE THE LEAD
information. losses, went on a shooting
ON MAJOR NATIONAL STORIES
Every Wednesday, during Big local stories became national spree, killing nine office
WGRZ’s 6 p.m. newscast, a news events in 1999, and workers, his wife and
reporter localizes a national story Gannett TV stations were there children and then himself.
CURLEY HO MCCORKINDALE
PA L M I S A N O
B R O K AW WILLIAMS
A SPECIAL THANKS
BOARD OF DIRECTORS
Peter B. Clark, former chairman, president and
CEO of The Evening News Association, and
Thomas A. Reynolds, chairman emeritus of
Chicago law firm Winston & Strawn, retired
from the Gannett Board of Directors on May 4,
1999. Clark had served on the board since
March 25, 1986; Reynolds, since June 26, 1979.
JOHN J. CURLEY STUART T.K. HO DOUGLAS H. MCCORKINDALE (a) Member of Audit Committee.
Chairman and chief executive Chairman of the board and Vice chairman and president, (b) Member of Executive
officer, Gannett Co., Inc. president, Capital Investment Gannett Co., Inc. Formerly: Committee.
Formerly: Chairman, president of Hawaii, Inc. Other Vice chairman and chief
(c) Member of Executive
and chief executive officer, directorships: Aloha Airgroup, financial and administrative
Gannett Co., Inc. (1989- Inc.; College Retirement officer, Gannett Co., Inc.
1997). Age 61. (b,d,f,g) Equities Fund; Pacific Century (1985-1997). Other director- (d) Member of Management
Financial Corporation. Age 64. ships: Continental Airlines, Continuity Committee.
(a,b,c) Inc.; Global Crossing Ltd.; and
H. JESSE ARNELLE (e) Member of Public
Of counsel to Winston-Salem, funds which are part of the Responsibility and Personnel
N.C., law firm of Womble, Prudential group of mutual
DREW LEWIS Practices Committee.
Carlyle, Sandridge & Rice. Former chairman and chief funds. Age 60. (b,f,g)
(f) Member of Gannett
Other directorships: FPL Group, executive officer, Union Pacific
Inc.; Textron Corporation; Corporation. Other directorships: SAMUEL J. PALMISANO
Eastman Chemical Co.; American Express Co.; FPL Senior vice president and (g) Member of Contributions
Armstrong World Industries; Group, Inc.; Millennium Bank; group executive, IBM Committee.
Waste Management, Inc.; Union Pacific Resources Group Enterprise Systems Group.
Union Pacific Resources Inc. Age 68. (a,d) Age 48. (a,c)
Group, Inc. Age 66. (d,e)
JOSEPHINE P. LOUIS KAREN HASTIE WILLIAMS
Chairman and chief executive Partner of Washington, D.C.,
MEREDITH A. BROKAW
Founder, Penny Whistle Toys, officer, Eximious Inc., and law firm of Crowell & Moring.
Inc., New York City, and author Eximious Ltd. Other director- Other directorships: Crestar
of children’s books. Other ships: HDO Productions, Inc.; Financial Services Corporation;
directorships: Conservation trustee, Chicago Horticultural Continental Airlines, Inc.;
International, Washington, Society; trustee, Chicago Fannie Mae; Washington Gas
D.C.; Women’s First Health Historical Society. Age 70. Light Company. Age 55. (a,c)
Care. Age 59. (b,d,e) (a,b,e)
CLAPP • COLEMAN
CHAPPLE • T. CURLEY•
Gannett’s principal management CHRISTOPHER W. BALDWIN, SUSAN CLARK-JOHNSON,
Vice president, taxes. Age 56. Senior group president,
group is the Gannett Management
Gannett Pacific Newspaper
Committee, which coordinates
Group, and president and
overall management policies for the SARA M. BENTLEY,
President, Gannett Northwest publisher, Reno (Nev.)
company. The Gannett Newspaper
Newspaper Group, and presi- Gazette-Journal. Age 53.s
Operating Committee oversees opera-
dent and publisher, Statesman
tions of the company’s newspaper
Journal, Salem, Ore. Age 48.s
division. The Gannett Broadcasting MICHAEL J. COLEMAN,
Senior group president,
Operating Committee coordinates
Gannett South Newspaper
management policies for the JAMES T. BROWN,
Executive chairman, Newsquest. Group, and president and
company’s television stations. The
Age 64. publisher, FLORIDA TODAY
members of these three groups
at Brevard County. Age 56.s
are identified at right and on the
previous pages. THOMAS L. CHAPPLE,
Senior vice president, general
The managers of the company’s ROBERT T. COLLINS,
counsel and secretary. Formerly: President, New Jersey
various local operating units enjoy
Vice president, general counsel Newspaper Group, and
substantial autonomy in local policy,
and secretary (1991-1995). president and publisher,
operational details, news content and
Age 52.• Asbury Park Press, Home
News Tribune, East Brunswick,
Gannett‘s headquarters staff
N.J., and Ocean County
includes specialists who provide RICHARD L. CLAPP,
Senior vice president/human Newspapers. Formerly:
advice and assistance to the
resources. Formerly: Vice President and publisher,
company’s operating units in various
president, compensation and Asbury Park Press and Home
phases of the company’s operations.
benefits (1983-1995). News Tribune (1997-1998);
At right are brief descriptions of
Age 59.• president and publisher,
the business experience during the
Courier-Post, Cherry Hill, N.J.
last five years of the officers of the
(1993-1997). Age 56.s
company and the heads of its national
and regional divisions. Officers serve
for a term of one year and may be
re-elected. Information about the
two officers who serve as directors
(John J. Curley and Douglas H.
McCorkindale) can be found on
C O M PA N Y & D I V I S I O N A L O F F I C E R S
CURRIE MALLARY x
FELLER • JASKE • MCCORKINDALE•
THOMAS CURLEY, CRAIG A. DUBOW, GEORGE R. GAVAGAN, Pictured on these pages are mem-
Senior vice president, Executive vice president, Vice president and controller. bers of the Gannett Management
administration, and president Gannett Television. Formerly: Formerly: Vice president, Committee, Gannett Newspaper
and publisher, USA TODAY. President and general manager, corporate accounting services Operating Committee and Gannett
Formerly: President and WXIA-TV, Atlanta (1992-1996). (1993-1997). Age 53. Broadcasting Operating Committee.
publisher, USA TODAY Age 45.x • Member of the Gannett
(1991-1998). Thomas Curley DENISE H. IVEY, Management Committee.
is the brother of John J. Curley. President, Gannett Gulf Coast
DANIEL S. EHRMAN JR.,
s Member of the Gannett
Age 51.• Vice president, planning and Newspaper Group, and
development. Formerly: president and publisher,
Senior vice president, Gannett Pensacola (Fla.) News Journal.
PHILIP R. CURRIE,
Senior vice president, news, Broadcasting (1995-1997); vice Age 49.s x Member of the Gannett
Newspaper Division. president, finance and business Broadcasting Operating
Formerly: Vice president, affairs, Gannett Broadcasting JOHN B. JASKE, Committee.
news, Newspaper Division (1984-1995). Age 53. Senior vice president, labor
(1982-1995). Age 58.s relations and assistant general
counsel. Age 55.•
MILLICENT A. FELLER,
Senior vice president, public
ARDYTH R. DIERCKS,
Senior vice president, Gannett affairs and government RICHARD A. MALLARY,
Television. Formerly: President relations. Age 52.• Senior vice president, Gannett
and general manager, KSDK-TV, Broadcasting. Formerly: Vice
St. Louis (1996-1998); president, news, Gannett
LAWRENCE P. GASHO,
president and general manager, Vice president, financial Broadcasting (1989-1995).
KVUE-TV, Austin, Texas analysis. Age 57. Age 57.x
(1994-1996). Age 45.x
continued on next page
MILLER • WALKER •x
OGDEN x s s
MOON RIDDLE s
GRACIA C. MARTORE, ROGER OGDEN, WENDELL J. VAN LARE,
Treasurer and vice president, Vice president, Gannett Vice president, senior labor
investor relations. Formerly: Television, and president and counsel. Age 54.
Vice president, treasury general manager, KUSA-TV,
services and investor relations Denver, Colo. Age 54.x FRANK J. VEGA,
(1996-1998); vice president, President and CEO, Detroit
treasury services (1993-1996). Newspapers. Age 51.s
W. CURTIS RIDDLE,
Age 47. Senior group president,
Gannett East Newspaper CECIL L. WALKER,
Group, and president and President, Gannett
Vice president, internal audit. publisher, The News Journal, Broadcasting Division.
Formerly: Director, internal Wilmington, Del. Age 48.s Age 63.•x
audit (1989-1995). Age 45.
CARLETON F. ROSENBURGH, BARBARA W. WALL,
Senior vice president, Gannett Vice president, senior legal
LARRY F. MILLER,
Executive vice president and Newspaper Division. Age 60.s counsel. Age 45.
chief financial officer. Formerly:
Senior vice president, financial GARY F. SHERLOCK, GARY L. WATSON,
planning and controller President, Gannett Atlantic President, Gannett Newspaper
(1991-1997). Age 61.• Newspaper Group, and Division. Age 54.•s
president and publisher, The
Journal News, Westchester
CRAIG A. MOON,
President, Piedmont County, N.Y. Age 54.s
Newspaper Group, and
president and publisher, MARY P. STIER,
The Tennessean, Nashville. President, Gannett Midwest
Formerly: Vice president, Newspaper Group, and presi-
Gannett South Newspaper dent and publisher, Rockford
Group, and president and (Ill.) Register Star. Age 42.s
publisher, The Tennessean
(1991-1999). Age 50.s
22 COMMON STOCK PRICES
23 MANAGEMENT’S RESPONSIBILITY FOR
23 MANAGEMENT’S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL
34 CONSOLIDATED BALANCE SHEETS
36 CONSOLIDATED STATEMENTS OF INCOME
37 CONSOLIDATED STATEMENTS OF CASH FLOWS
38 CONSOLIDATED STATEMENTS OF CHANGES
IN SHAREHOLDERS’ EQUITY
39 NOTES TO CONSOLIDATED FINANCIAL
51 REPORT OF INDEPENDENT ACCOUNTANTS
52 11-YEAR SUMMARY
54 NOTES TO 11-YEAR SUMMARY
55 FORM 10-K INFORMATION
66 QUARTERLY STATEMENTS OF INCOME
68 SCHEDULES TO FORM 10-K INFORMATION
76 GLOSSARY OF FINANCIAL TERMS
MANAGEMENT’S RESPONSIBILITY MANAGEMENT’S DISCUSSION
FOR FINANCIAL STATEMENTS AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL POSITION
The management of the company has prepared and is responsible
for the consolidated financial statements and related financial Basis of reporting
information included in this report. These financial statements Following is a discussion of the key factors that have affected
were prepared in accordance with generally accepted accounting the company’s business over the last three fiscal years. This
principles in the United States. These financial statements commentary should be read in conjunction with the company’s
necessarily include amounts determined using management’s best financial statements, the 11-year summary of operations and the
judgments and estimates. Form 10-K information that appear in the following sections of
The company’s accounting and other control systems this report.
provide reasonable assurance that assets are safeguarded and The company’s fiscal year ends on the last Sunday of the
that the books and records reflect the authorized transactions of calendar year. The company’s 1999 fiscal year ended on Dec. 26,
the company. Underlying the concept of reasonable assurance is 1999, and encompassed a 52-week period. The company’s 1998
the premise that the cost of control not exceed the benefit derived. and 1997 fiscal years also encompassed 52-week periods.
Management believes that the company’s accounting and other
control systems appropriately recognize this cost/benefit Business acquisitions, exchanges and dispositions
The company’s independent accountants, Pricewaterhouse-
On June 24, 1999, Gannett made a cash offer to acquire the stock
Coopers LLP provide an independent assessment of the degree to
of Newsquest plc (“Newsquest”). Newsquest’s principal activities
which management meets its responsibility for fairness in financial
are publishing and printing regional and local newspapers in
reporting. They regularly evaluate the company’s system of internal
England with a portfolio of 180 titles that include paid-for daily
accounting controls and perform such tests and other procedures
and weekly newspapers, and free weekly newspapers.
as they deem necessary to reach and express an opinion on the
The offer was for 460 pence (U.S. $7.26) in cash or loan notes
financial statements. The PricewaterhouseCoopers LLP report
for each of 200.4 million fully diluted shares, for a total price of
appears on page 51.
approximately 922 million pounds sterling (U.S. $1.5 billion).
The Audit Committee of the Board of Directors is responsible
Gannett also financed the repayment of Newsquest’s existing debt.
for reviewing and monitoring the company’s financial reports
Share purchases commenced in the third quarter of 1999 and
and accounting practices to ascertain that they are appropriate in
were financed principally by commercial paper borrowings and
the circumstances. The Audit Committee consists of five non-
operating cash flow. On July 26, 1999, Gannett declared the
management directors, and meets to discuss audit and financial
offer unconditional in all respects and shortly thereafter, Gannett
reporting matters with representatives of financial management,
effectively owned 100% of Newsquest shares. The acquisition
the internal auditors and the independent accountants. The
was recorded under the purchase method of accounting and
internal auditors and the independent accountants have direct
Newsquest’s results of operations are included in the company’s
access to the Audit Committee to review the results of their
financial statements from July 26, 1999 forward.
examinations, the adequacy of internal accounting controls and
On June 1, 1999, the company completed a broadcast station
the quality of financial reporting.
transaction under which it exchanged its ABC affiliate KVUE-TV
in Austin, Texas, and received KXTV-TV, the ABC affiliate in
Sacramento, Calif., plus cash consideration. For financial reporting
purposes, the company recorded the exchange as two simultane-
ous but separate events; that is, a sale of its Austin TV station for
which a non-operating gain was recognized and the acquisition of
Douglas H. McCorkindale Larry F. Miller
the Sacramento station accounted for under the purchase method.
Vice Chairman and President Executive Vice President
In its second quarter, the company reported a net non-operating
and Chief Financial Officer
gain of $55 million ($33 million after tax) principally as a result of
In March 1999, the company contributed The San Bernardino
County Sun to a partnership that includes 21 daily California
newspapers in exchange for a partnership interest.
The aggregate purchase price, including liabilities assumed,
for businesses and assets acquired in 1999 including Newsquest,
the Sacramento television station and certain smaller non-daily
newspaper publishing operations, totaled approximately