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Tribune Presents Business Update at
Media Conferences
Executives outline
strategies for 2006
CHICAGO,
December 7, 2005 -- Tribune Company
(NYSE:TRB) executives today updated business progress and
outlined company strategies for 2006 at the annual UBS and
Credit Suisse First Boston Media Week conferences in New
York City.
"Tribune’s local businesses continue
to be leaders in their communities, valued by consumers and
advertisers alike," said Dennis FitzSimons, chairman,
president and chief executive officer. "We are local
media, and provide crucial news and information for the markets
we serve. This is especially true in times of crisis, such
as when the hurricanes hit New Orleans and South Florida
this fall."
Additionally, FitzSimons said, "Our
newspapers and broadcast stations continue to generate
significant cash flow, and that enables both our important
journalistic mission and our ability to create value for
shareholders."
He highlighted the company’s expense
reduction initiatives and said Tribune was redeploying
resources and investing in areas that will contribute to
future growth, like further expansion on the Internet.
Scott Smith, Tribune Publishing president,
cited growing responsive readership and subscriber retention
as top priorities for 2006. He also said the newspaper
group is "committed
to leading the aggressive changes required to best serve
our customers and communities, and to deliver better financial
results."
John Reardon, Tribune Broadcasting president,
said the company’s
26 television stations aim to maximize cash flow by emphasizing
innovation, economies of scale and tight cost controls. He
pointed to several bright spots for the group, including
solid ratings for several shows on the WB and Fox networks,
strong local news franchises and growth at Superstation WGN.
"Clearly, our goal is to improve performance
in 2006," Reardon
said. "With some help from our local markets, we’re
optimistic we can achieve that."
Don Grenesko, Tribune chief financial
officer, said actions taken to reduce the company’s
cost structure will result in special charges in the fourth
quarter. Staff reductions totaling 900 positions, mostly
in publishing, will generate severance charges of $40 to
$45 million. In addition, the closing of a Los Angeles
Times production facility will result in a non-cash charge
of $50 to $60 million. Grenesko said annual expense savings
of $55 to $60 million beginning in 2006 will provide a
nine-month payback of the cash expenses associated with
the restructuring.
Tribune’s capital expenditures in 2006 will be about
$220 million, unchanged from 2005, Grenesko added. Debt should
also be flat, he said, and interest expense will increase
by approximately $40 million. The company’s effective
tax rate will be 39.25 percent.
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TRIBUNE (NYSE: TRB) is
one of the country’s top media companies, operating
businesses in publishing and broadcasting. It reaches more
than 80 percent of U.S. households and is the only media
organization with newspapers, television stations and websites
in the nation’s top three markets. In publishing, Tribune
operates 11 leading daily newspapers including the Los Angeles
Times, Chicago Tribune and Newsday, plus a wide range of
targeted publications such as Spanish-language Hoy. The company’s
broadcasting group operates 26 television stations, Superstation
WGN on national cable, Chicago’s WGN-AM and the Chicago
Cubs baseball team. Popular news and information websites
complement Tribune’s print and broadcast properties
and extend the company’s nationwide audience.
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