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Press Release

Tribune Reports 2003 Second Quarter Earnings

Tribune presents earnings per share amounts on a generally accepted accounting principles ("GAAP") basis only. This differs from the pro forma earnings per share amounts supplied by broker analysts to databases such as First Call.

"Our second quarter results reflect solid momentum as we head into the second half of 2003," said Dennis FitzSimons, Tribune president and chief executive officer. "The advertising environment is slowly but steadily improving and Tribune’s broadcasting and publishing groups are benefiting as a result."

SECOND QUARTER 2003 RESULTS

CONSOLIDATED

Tribune’s 2003 second quarter operating revenues increased 5.0 percent to $1.45 billion from $1.38 billion in the 2002 second quarter. Consolidated cash operating expenses increased 4.1 percent in the second quarter. Operating cash flow was up 7.3 percent to $427 million, compared with $398 million in the second quarter of 2002. Tribune’s operating profit increased 7.7 percent to $370 million, compared with $343 million in 2002. Operating cash flow margin improved to 29.5 percent in the 2003 second quarter from 28.8 percent in the 2002 second quarter.

PUBLISHING

Publishing’s second quarter operating revenues were $1.01 billion, up 2.9 percent from last year’s second quarter. Publishing operating cash flow was $279 million, a 4.3 percent increase from $267 million in 2002, while cash operating expenses rose by 2.4 percent. Publishing operating profit increased 4.7 percent to $235 million, up from $224 million in 2002.

Management Discussion

• Retail print advertising revenue rose by 4 percent for the quarter. Preprint revenue increased 11 percent, led by a 12 percent increase in Los Angeles. Preprint revenue in Chicago and New York was up 13 percent and 5 percent, respectively. Increases in food, furniture/home furnishing, department stores, hardware and health care were partially offset by a decline in electronics.
• National print advertising was up 10 percent for the quarter. Increases in hi-tech, auto manufacturers and financial categories were partially offset by a decrease in travel/resorts.
• Classified print advertising decreased 4 percent for the quarter. Help wanted revenue for the group was down 17 percent; Chicago and New York both fell 19 percent; Los Angeles was off 16 percent. Although the help wanted category still shows double-digit declines, sequential improvement is continuing. Auto increased 1 percent and real estate was up 9 percent.
• Interactive revenues were up 15 percent due to strength in classified and national advertising.
• Cash operating expenses increased 2 percent from second quarter 2002, due primarily to higher newsprint prices, one-time expenses in Baltimore related to contingency planning for possible labor action, and to a lower pension credit. Newsprint and ink expense was 6 percent higher than 2002 as newsprint cost per ton was up 5 percent and consumption increased less than 1 percent.
• In second quarter 2003, publishing’s operating cash flow margin was 27.5 percent, up slightly compared to the second quarter of 2002.

BROADCASTING AND ENTERTAINMENT

Broadcasting and Entertainment’s second quarter operating revenues increased
10.2 percent to $436 million, up from $396 million in 2002. Operating cash flow was $162 million, up 15.0 percent from $141 million in 2002. Operating profit increased 15.0 percent to $149 million from $130 million last year.

Television’s second quarter revenues jumped 12.0 percent to $354 million, up from
$316 million in 2002. Television cash operating expenses increased 9.4 percent from last year. Television operating cash flow increased 15.5 percent to $156 million, while operating profit increased 15.3 percent to $144 million.

Management Discussion

• In second quarter 2003, television’s operating cash flow margin was 44 percent, an increase of 1 percentage point from second quarter 2002.
• The acquisition of KPLR-TV, St. Louis and KWBP-TV, Portland, Ore. was completed on March 21, 2003. In July 2002, the Company completed the acquisition of WTTV-TV, Indianapolis. The following discussion of television results excludes these acquisitions:
  • Television advertising revenues increased 6 percent in the quarter.
  • Television cash operating expenses were up 3 percent compared with last year. Broadcast rights amortization increased 6 percent, due to the fall 2002 launch of "Will and Grace". Other television cash expenses were up 1 percent compared with last year.
• For the 2002-2003 season, the WB Network achieved several all-time season records and secured the strongest growth of any broadcast network, up 17 percent in the key 18-34 demographic.

EQUITY RESULTS

Equity income was $2 million in the second quarter of 2003, compared with a loss of
$4 million in the second quarter of 2002, primarily due to the recognition of equity income from TV Food Network in 2003.

NON-OPERATING ITEMS

In the 2003 and 2002 second quarters, Tribune recorded a net after-tax non-operating gain of $32 million, or $.10 per diluted share, and a net after-tax non-operating loss of $61 million, or $.19 per diluted share, respectively, primarily from marking-to-market the Company’s PHONES derivatives and related AOL Time Warner investment.

ADDITIONAL FINANCIAL DETAILS

Corporate expenses for the 2003 second quarter increased 33 percent to $14 million from $11 million in the second quarter of 2002 mainly due to a lower pension credit and higher insurance expense.

Net interest expense for the 2003 second quarter decreased to $49 million, down 6 percent from $52 million in the second quarter 2002. The decrease was primarily due to a reduction in outstanding debt, including the LYONs redemption in June 2003. Debt at the end of the 2003 second quarter, excluding the PHONES, was just under $2.2 billion compared with $2.75 billion at the end of 2002.

The effective tax rate in the 2003 second quarter was 38.7 percent, compared with a rate of 39 percent in the second quarter of 2002.

Capital expenditures were about $32 million in the second quarter of 2003.

FULL YEAR 2003 OUTLOOK

The Company anticipates that its full year 2003 diluted earnings per share will be within the range of current analyst estimates of $2.05 to $2.20. This assumes the economy rebounds, consolidated operating expenses increase in the low single digits in the second half of 2003 (somewhat lower than the first half of 2003), and non-operating items for the year are not material. Consolidated operating expenses are projected to increase in the mid single digit range in the third quarter of 2003 and be relatively flat in the fourth quarter of 2003.

WEBCAST OF CONFERENCE CALL

Today at 8 a.m. (CDT), a live Webcast of the 2003 second quarter conference call will be accessible through www.tribune.com and www.ccbn.com. An archive of the Webcast will be available on these sites from July 17 through July 24. More information about Tribune is available at www.tribune.com or by calling 800/757-1694.

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1. “Operating profit” for each segment excludes interest income and expense, equity earnings and losses, non-operating items and income taxes. “Operating cash flow” is defined as operating profit before depreciation and amortization. “Cash operating expenses” are defined as operating expenses before depreciation and amortization. Tables accompanying this release include a reconciliation of operating profit to operating cash flow and operating expenses to cash operating expenses.

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TRIBUNE (NYSE: TRB) is one of the country’s premier media companies, operating businesses in publishing and broadcasting. It reaches more than 80 percent of U.S. households, and is the only media company with television stations, newspapers and Web sites in the nation’s top three markets. In publishing, Tribune operates 12 market-leading daily newspapers such as the Los Angeles Times, Chicago Tribune and Newsday plus a wide range of targeted publications including Spanish-language newspapers. In broadcasting, Tribune properties include 26 television stations and Superstation WGN on national cable. These publishing and broadcasting interests are complemented by high-traffic news and information Web sites in 20 of the nation’s top 30 markets.

This press release contains certain comments or forward-looking statements that are based largely on the Company’s current expectations and are subject to certain risks, trends and uncertainties. Such comments and statements should be understood in the context of Tribune’s publicly available reports filed with the SEC, including the most current annual 10-K report and quarterly 10-Q report, which contain a discussion of various factors that may affect the company’s business. These factors could cause actual future performance to differ materially from current expectations. Tribune Company is not responsible for updating the information contained in this press release beyond the published date, or for changes made to this document by wire services or Internet service providers. This press release is being furnished to the Securities and Exchange Commission through a Form 8-K.