UNITED STATES

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C . 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
 

Date of Report (Date of earliest event reported)

October 22, 2003
 

The McClatchy Company

(Exact name of registrant as specified in its charter)
 

Delaware

1-9824

52-2080478

(State or other jurisdiction
of incorporation)

(Commission
File Number)

(IRS Employer
Identification No.)
 

2100 Q Street, Sacramento, CA 95816

(Address of principal executive offices, including zip code)
 

Registrant's telephone number, including area code

(916) 321-1846
 

Item 7.

Financial Statements and Exhibits

(c)

Exhibits

The following exhibit is filed herewith:

Exhibit

Number

Description


99.1

Text of press release issued by The McClatchy Company, dated October 22, 2003, titled " McCLATCHY REPORTS RECORD THIRD QUARTER 2003 EARNINGS AND PROVIDES FOURTH QUARTER OUTLOOK"

Item 9.

Regulation FD Disclosure (Information Furnished in this Item 9 is Furnished under Item 12)


In accordance with Securities and Exchange Commission Release No. 33-8216, the following information, which is intended to be furnished under Item 12, "Results of Operations and Financial Condition," is instead being furnished under Item 9, "Regulation FD Disclosure." This information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

The McClatchy Company's press release dated October 22, 2003 is incorporated herein by reference and is attached hereto as Exhibit 99.1.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto daily authorized.


Date: October 22, 2003

  


The McClatchy Company
 



By



/s/                Patrick J. Talamantes
   

Patrick J. Talamantes
Vice President and

Chief Financial Officer

 

Exhibit Index

Exhibit

Number

Description
   

99.1

Text of press release issued by The McClatchy Company, dated
October 22, 2003, titled " McCLATCHY REPORTS RECORD THIRD QUARTER 2003 EARNINGS AND PROVIDES FOURTH QUARTER OUTLOOK"

 

 

EXHIBIT 99.1

Contact:

Elaine Lintecum
Treasurer
(916) 321-1846
elintecum@mcclatchy.com

 

 

 

 

McCLATCHY REPORTS RECORD THIRD QUARTER 2003 EARNINGS AND

PROVIDES FOURTH QUARTER OUTLOOK

 

SACRAMENTO, CA, October 22, 2003 - The McClatchy Company (NYSE-MNI) - today reported record third quarter earnings of $35.8 million, or 77 cents per share, compared to earnings from continuing operations of $32.5 million, or 70 cents per share, in the third quarter of 2002. Net income in the 2002 quarter including The Newspaper Network, a discontinued operation, was $32.6 million or 71 cents per share.

Revenues in the third quarter of 2003 were $272.1 million, up 3.0% from 2002 revenues from continuing operations of $264.2 million, with advertising revenues of $225.4 million, up 4.2%, and circulation revenues of $41.3 million, up 0.1%.

Earnings from continuing operations in the first nine months were $98.5 million or $2.12 per share. Net income, which includes income from the operating results and the sale of The Newspaper Network (TNN), a discontinued operation, was $104.6 million or $2.25 per share. TNN was sold in June 2003 and the company recorded a gain of 13 cents per share on the sale. Earnings from continuing operations in the first nine months of 2002 totaled $91.8 million or $1.99 per share and net income including the results from TNN was $92.2 million or $2.00 per share.

Revenues from continuing operations through September were $806.4 million, up 2.7% from 2002 revenues of $785.3 million, with advertising revenues of $665.3 million, up 3.7%, and circulation revenues of $124.2 million, down 0.2% from 2002.

Commenting on the results, Gary Pruitt, McClatchy's chairman and chief executive officer, said, "The combination of a very good advertising month in September and cost controls resulted in our earnings coming in above the range we had previously anticipated for the quarter. Advertising revenues increased 6.8% in September. Indeed, we hit on all cylinders in the third quarter - newspaper, direct marketing and online advertising all reported strong growth. Additionally, we saw increases in newspaper circulation and online page views. Compared to third quarter 2002, daily circulation grew 0.8% and Sunday circulation increased 1.2%. Pageviews at our newspaper websites increased 19.7% through the first nine months of the year.

"As strong as the third quarter was, we know that comparisons are growing more difficult because we had advertising revenue growth of 4.9% in the fourth quarter of last year. However, we are pleased by the recent gains in retail and national advertising and believe our direct marketing and online revenue growth will continue its momentum. Early October activity suggests that revenue growth will be more modest than in September - an expected result considering that we face more difficult comparisons in October than we did in September.

"Given all these factors, we anticipate advertising revenue growth in the fourth quarter will be in the low to mid-single digit range and earnings will be in the range of 87 to 90 cents per share. We now believe earnings from continuing operations for full year 2003 will be between $2.99 and $3.02 per share, up from our previous guidance of $2.85 and $2.95 per share."

Pat Talamantes, McClatchy's chief financial officer, noted, "Our debt at the end of the third quarter was $397 million. We have been able to pay down $99 million since the end of 2002 even as we have increased our dividend 10% and made contributions of $50 million to our employees' pension plans. We will continue to focus on debt repayment and improving an already strong balance sheet at McClatchy. We expect debt at year-end 2003 to be $370 million or less."

The company's statistical report, which summarizes its revenue performance through September, follows.

At 11:30 am Eastern time today, McClatchy will review its results in a conference call

(1-877-278-1205, use pass code 3164176) and webcast (www.mcclatchy.com). A replay of the call can be accessed for up to 48 hours by dialing 1-800-642-1687 and using the same pass code, 3164176. The webcast will be archived at McClatchy's website.

The McClatchy Company, headquartered in Sacramento, California, is a leading newspaper and Internet publisher. It publishes 11 daily and 13 non-daily newspapers located in western coastal states, North and South Carolina and the Twin Cities of Minneapolis/St. Paul. McClatchy has daily circulation of 1.39 million and Sunday circulation of 1.85 million. McClatchy's newspapers include, among others, the Star Tribune in Minneapolis, The Sacramento Bee, The Fresno Bee and The Modesto Bee in California, The News & Observer (Raleigh, NC), The News Tribune (Tacoma, WA) and the Anchorage Daily News.

McClatchy also publishes leading local websites in each of its 11 daily newspaper markets, offering readers information, comprehensive news, advertising, e-commerce and other services and owns and operates Nando Media, a national on-line publishing operation. McClatchy is listed on the New York Stock Exchange under the symbol MNI.

Additional Information

This release contains forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ. These risks and uncertainties include national and local economic conditions that could affect advertising and circulation rates and volumes, changes in interest rates and/or newsprint prices, increased competition in our markets, as well as the other risks detailed from time to time in the Company's publicly filed documents, including the Company's December 29, 2002 report on form 10-K and June 29, 2003 report on form 10-Q, filed with the U.S. Securities and Exchange Commission. The Company assumes no obligation to update the forward-looking information contained in this release.

THE McCLATCHY COMPANY

SUMMARY OF UNAUDITED RESULTS

(In thousands, except per-share amounts)

Three months ended

Nine months ended

September 28, 2003

September 29, 2002 (1)

September 28, 2003

September 29, 2002 (1)

Revenues - net

$ 272,100

$ 264,172

$ 806,351

$ 785,284

Operating expenses:

Compensation

110,488

107,398

333,110

322,049

Newsprint and supplements

34,179

31,202

99,984

95,813

Depreciation and amortization

17,166

18,253

52,519

55,131

Other operating expenses

49,001

47,709

146,116

137,910

Total operating expenses

210,834

204,562

631,729

610,903

Operating income

61,266

59,610

174,622

174,381

Interest expense

(3,888)

(6,008)

(14,549)

(21,060)

Partnership income (loss)

449

(225)

259

(1,125)

Other non-operating income - net

85

230

(199)

(498)

Income from continuing operations before taxes

57,912

53,607

160,133

151,698

Income tax provision

(22,130)

(21,157)

(61,587)

(59,884)

Income from continuing operations

35,782

32,450

98,546

91,814

Income from discontinued operation

56

199

6,050

356

Net income

$ 35,838

$ 32,649

$ 104,596

$ 92,170

Net income per common share:

Basic:

Income from continuing operation

$ 0.78

$ 0.71

$ 2.14

$ 2.01

Income from discontinued operation

-    

-

$ 0.13

0.01

Net income per share

$ 0.78

$ 0.71

$ 2.27

$ 2.02

Diluted:

Income from continuing operation

$ 0.77

$ 0.70

$ 2.12

$ 1.99

Income from discontinued operation

-     

-    

0.13

0.01

Net income per share

$ 0.77

$ 0.71

$ 2.25

$ 2.00

Weighted average common shares:

Basic

46,146

45,813

46,087

45,741

Diluted

46,466

46,209

46,394

46,133

(1) Restated to reflect discontinued operation.

The McClatchy Company

Consolidated Statistical Report

(In thousands, except for preprints and page views)

Period 9

Period 9 Year-to-Date

Revenues - Net: *

2003

2002

% Change

2003

2002

% Change

Advertising

Daily Newspapers:

Minneapolis

$24,611

$23,286

5.7%

$214,328

$209,876

2.1%

California

27,043

23,868

13.3%

247,261

230,048

7.5%

Carolinas

11,754

11,779

-0.2%

107,796

108,236

-0.4%

Northwest

10,356

10,124

2.3%

95,926

93,381

2.7%

Total Advertising

$73,764

$69,057

6.8%

$665,311

$641,541

3.7%

Circulation

12,913

12,946

-0.3%

124,187

124,414

-0.2%

Other

1,829

2,187

-16.4%

16,080

18,270

-12.0%

Total Newspapers

$88,506

$84,190

5.1%

$805,578

$784,225

2.7%

Non-Newspapers

71

118

-39.8%

773

1,059

-27.0%

Total Revenue

$88,577

$84,308

5.1%

$806,351

$785,284

2.7%

* Revenues reported are from continuing operations only.

Average Paid Circulation: (Period)

Daily

1,444.2

1,417.5

1.9%

1,386.2

1,379.8

0.5%

Sunday

1,912.2

1,878.8

1.8%

1,856.8

1,847.7

0.5%

Community Newspapers

61.1

63.8

-4.2%

61.0

62.8

-2.9%

Online: (Monthly)

Millions of Page Views**

94.7

89.3

6.0%

936.9

782.9

19.7%

** Page Views have been restated to remove Nando Times and SportsServer discontinued products.

Advertising Linage for Dailies:

Full Run ROP

Retail

442.7

437.1

1.3%

4,047.0

4,103.3

-1.4%

National

98.1

84.1

16.6%

877.3

785.7

11.7%

Classified

593.8

622.5

-4.6%

5,540.2

5,638.4

-1.7%

Total

1,134.6

1,143.7

-0.8%

10,464.5

10,527.4

-0.6%

Millions of Preprints Distributed

246.4

229.2

7.5%

2,229.1

2,107.4

5.8%

Full Run ROP Linage by Market for Dailies:

California:

The Sacramento Bee

209.1

197.3

6.0%

1,901.0

1,846.4

3.0%

The Fresno Bee

103.4

96.6

7.0%

957.1

918.0

4.3%

The Modesto Bee

102.0

100.4

1.6%

977.3

955.9

2.2%

Star Tribune, Minneapolis

161.0

156.2

3.1%

1,406.2

1,383.0

1.7%

Northwest:

The News Tribune, Tacoma

104.5

113.3

-7.8%

957.0

1,045.6

-8.5%

Anchorage Daily News

77.0

79.3

-2.9%

685.8

723.8

-5.3%

Tri-City Herald

61.5

61.8

-0.5%

570.9

558.8

2.2%

Carolinas:

The News & Observer, Raleigh

153.0

166.0

-7.8%

1,447.5

1,553.8

-6.8%

South Carolina Dailies

163.1

172.8

-5.6%

1,561.7

1,542.1

1.3%

Total

1,134.6

1,143.7

-0.8%

10,464.5

10,527.4

-0.6%