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Thursday, March 20, 2008

Tribune Profits Spent on Golden Parachutes


Tribune Reports 2007 Fourth Quarter and Full Year Results

CHICAGO Mar. 20, 2008 -- Tribune Company today reported a loss from continuing operations of $78 million for the fourth quarter of 2007 compared with income from continuing operations of $233 million in the fourth quarter of 2006. For the full year 2007, Tribune reported income from continuing operations of $55 million compared with $661 million in 2006.

"Despite the continued difficult operating environment and weakness in print revenue, we see significant opportunity within Tribune Company," said Sam Zell, Chairman and CEO. "In our first 75 days, we've made a series of key leadership changes, have launched a number of programs and projects to drive new revenue, and have initiated a fundamental shift in culture. In addition, we have begun a strategic review of certain Tribune assets to determine whether capital can be more effectively redeployed into our core operations or toward reducing our outstanding leverage."

The declines in both the fourth quarter and full year 2007 operating results were largely due to lower revenues, higher interest expense and the net effect of the items described below.

Fourth quarter 2007 and 2006 results from continuing operations included the following:

A pretax non-cash impairment charge of $130 million ($79 million after taxes) in the 2007 quarter to write-down the Company’s masthead intangible assets to fair value.

A pretax charge of $64 million ($42 million after taxes) in the 2007 quarter for accelerated stock-based compensation expense and certain one-time compensation payments resulting from the completion of the Company’s going-private transaction.

A pretax charge of $23 million ($16 million after taxes) for severance and related charges in the 2007 quarter compared with a pretax charge of $6 million ($4 million after taxes) in the 2006 quarter.

A pretax charge of $16 million ($10 million after taxes) in the 2007 quarter related to the Company’s new management equity incentive plan.

A pretax charge of $6 million ($4 million after taxes) in the 2007 quarter for the write-down of Tribune Entertainment program assets.

A pretax charge of $3 million ($2 million after taxes) in the 2007 quarter to increase the accrual for anticipated advertiser claims at Newsday.

A pretax charge of $4 million ($2 million after taxes) in the 2006 quarter for the disposition of a press related to the shutdown of the Los Angeles Times San Fernando Valley printing facility.

A pretax gain of $7 million ($4 million after taxes) in the 2006 quarter related to the sale of the corporate airplane.

An after-tax non-operating gain of $11 million in 2007 compared with an after-tax non-operating gain of $69 million in 2006.

Full report at Tribune Company

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