Washington Post 2010 Annual Report Download

Download and view the complete annual report

Please find the complete 2010 Washington Post annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 118

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118

2010 ANNUAL REPORT

Table of contents

  • Page 1
    2010 annual report

  • Page 2
    2010 Revenue by PRinciPal OPeRatiOns EDUCATION 62% CABLE TELEVISION 16% NEWSPAPER PUBLISHING 14% TELEVISION BROADCASTING 7% OTHER BUSINESSES 1%

  • Page 3
    ...34.26 1 4.58 1 0. 1 1 30.50 34. 10 DILUTED EARNINGS PER COMMON SHARE ($) 10 09 08 07 06 3 1 .04 9.78 6.87 30.1 9 33.68 *Computed on a comparable basis, excluding the impact of the adjustment for pensions and other postretirement plans on average common shareholders' equity. 1 2010 annual report

  • Page 4
    ... to repurchase more stock than we had done in any recent year (more on this later, as well). at the same time, however, attacks on Kaplan's Higher education unit (and on for-profit education generally) took up much of management's time and energy in 2010 - and will take up much of this letter. it...

  • Page 5
    ... and neediest students in america. so Jonathan grayer, then Kaplan's ceo, assigned andy rosen, then Kaplan's president, to take over Kaplan's online higher education efforts. since 2001, all of Kaplan's online programs, and since 2005, all of its higher education programs 3 2010 annual report

  • Page 6
    ...-profit universities graduate fewer students than traditional universities; their students also have higher debt loads when they leave college; and, they are likelier to default. RISK FACTORS i am proud to stand with the management of Kaplan, our higher education campuses and online programs and...

  • Page 7
    ... resources (there are many) will have to borrow almost all of the cost of higher education. But that student also has much more at stake. let's step away from Kaplan for a moment and consider another set of students. this year, roughly 60% of students graduating from Washington, Dc's public schools...

  • Page 8
    ... violations of many of Kaplan's standards and values. andy rosen and i issued a joint statement calling the misconduct "sickening" and promising changes. Here's what happened in the aftermath (this Does this make a difference? there's one for-profit higher education company whose major source of...

  • Page 9
    ... us prevent future problems in the admissions departments of our schools. 4. Most important, we implemented a new program called the Kaplan commitment. it provides that students enrolling in Kaplan Higher education programs can choose to leave the program after four or five weeks and owe us nothing...

  • Page 10
    ...writing that in their 2010 letter). the newspaper division books a noncash pension expense; in 2010, it was $21.9 million. i'd advise shareholders: ignore the noncash expense (it's broken out in our segment reporting). the post's digital team, led by managing editor at the Washington post newspaper...

  • Page 11
    ... and sunday circulation among metropolitan papers. 2011 will not be an easy year (there are no easy years in the newspaper business). the large cuts of 2010 can't be repeated, and we don't expect a rebound in print revenue. Meanwhile, the corporate digital team, under Vijay ravindran, has come up...

  • Page 12
    ...by buying at a time when the company is selling at less than the value of its assets). We've never bought routinely, regardless of price. Because of our 35-year off-and-on repurchasing, a shareholder since those long-ago days three corporate developments warrant mention. First, we sold newsweek. it...

  • Page 13
    ...-conceived our board underwent enormous change in 2010-2011. First, Melinda gates left the board. if only for her knowledge of technology and education, Melinda was a uniquely excellent board member. Her awesome work at the gates Foundation somehow left her time to apply herself to company matters...

  • Page 14

  • Page 15
    ... St., N.W., Washington, D.C. (Address of principal executive offices) 20071 (Zip Code) Registrant's Telephone Number, Including Area Code: (202) 334-6000 Securities Registered Pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered Class B Common Stock...

  • Page 16
    ... POST COMPANY 2010 FORM 10-K Item 1. Business ...Education ...Cable Television Operations ...Newspaper Publishing ...Television Broadcasting ...Other Activities ...Production and Raw Materials ...Competition ...Executive Officers ...Employees ...Forward-Looking Statements ...Available Information...

  • Page 17
    ... online law school. At year-end 2010, Kaplan University had approximately 58,200 students enrolled in online programs and 7,400 students enrolled in its classroom-based programs. Kaplan Higher Education Campuses At the end of 2010, Kaplan's Higher Education Campuses business consisted of 63 schools...

  • Page 18
    ... loan program totaled approximately 1% of its higher education net revenue in 2010. Direct student payments, funds received under various state and agency grant programs and corporate reimbursement under tuition assistance programs accounted for most of the remainder of 2010 Kaplan Higher Education...

  • Page 19
    ... limit access to Title IV program funds by students attending the institution. Currently, one Kaplan Higher Education reporting unit is provisionally certified. In addition, the Department of Education may fine a school, require a school to repay Title IV program funds, limit or terminate a school...

  • Page 20
    ... that these resources will enable Kaplan's schools to maintain cohort default rates below the thresholds for sanctions. In the fourth quarter of 2010, most programs at Kaplan University and Kaplan Higher Education campuses implemented the Kaplan Commitment, which requires students to meet certain...

  • Page 21
    ... will require Kaplan Higher Education to change its practices to comply with these requirements and could increase its administrative costs. Gainful Employment. In the July 2010 NPRM, the Department of Education published proposed regulations that purport to tie an educational program's eligibility...

  • Page 22
    ...undesirable impact on tuition, there is no assurance that the Department of Education, or Congress, will address this problem. Furthermore, the 90/10 rule and schools' inability to limit students' lending will make it more difficult for Kaplan's schools to comply with 6 THE WASHINGTON POST COMPANY

  • Page 23
    ...'s Office of the Inspector General any credible information indicating that any student, parent, employee, third-party servicer or other agent of the institution has engaged in any fraud or other illegal conduct involving Title IV programs; Timely submit all required reports and financial statements...

  • Page 24
    ... or more of Kaplan Higher Education's business activities within its boundaries, Kaplan Higher Education may not be able to recruit or enroll students in that state and may have to cease providing services and advertising in that state. As of December 31, 2010, Kaplan Higher Education's schools are...

  • Page 25
    ...failed to properly resolve conflicting information in student financial aid files. The school responded to these findings in September 2010. No assurance can be given that the Department of Education's final report will not have a significant adverse effect on Kaplan's ability to continue to operate...

  • Page 26
    ..., online programs, printed study guides, in-house training and through other technological means. During 2010, these businesses enrolled more than 651,000 students in their courses (including more than 241,000 enrolled in online programs). Kaplan International Kaplan International includes Kaplan...

  • Page 27
    ...all based in the U.K. and Ireland: Kaplan UK; Kaplan International Colleges; and a set of higher education institutions. The Kaplan UK business in Europe is a provider of training, test preparation services and degrees for accounting and financial services professionals, including those studying for...

  • Page 28
    ... as Kaplan's corporate venture capital arm, identifying and investing in high-growth education technology companies. Cable Television Operations Through its subsidiary Cable ONE, Inc. ("Cable ONE"), the Company owns and operates cable television systems that provide video, Internet and phone service...

  • Page 29
    ... as pay-per-view and per-channel premium program services, digital video, cable modem and digital telephone services-and for advertising currently are exempt from regulation. "Must-Carry" and Retransmission Consent. Federal law provides that a commercial television broadcast station may, subject to...

  • Page 30
    ... is required. Neither the FCC nor the courts have addressed this issue definitively, but in the meantime, most major telephone companies are entering into franchise agreements to provide their video programming distribution services to consumers. Increased competition from telephone companies that...

  • Page 31
    ...in 2010 initiated a broader regulatory proceeding to consider whether it should require all multichannel video program distributors, which include cable operators, to develop and provide a new, universal set-top box solution that allows access to both online and traditional video. The Company cannot...

  • Page 32
    ... FCC ruled that a telephone company's offering of digital subscriber line ("DSL") Internet access service and a mobile wireless company's offering of similar wireless broadband service also are "information services." Cable ONE currently offers broadband Internet access service on virtually all of...

  • Page 33
    ... of a company's universal service fund contribution is based on a percentage of revenues earned from end-user interstate and international interconnected VoIP services. Cable ONE is permitted to recover these contributions from its customers. This percentage figure changes from time to time and...

  • Page 34
    ...Washington Post, which is a morning daily and Sunday newspaper primarily distributed by home delivery in the Washington, DC, metropolitan area, including large portions of Maryland and northern Virginia. The Post's two primary sources of revenue are advertising and subscription fees, which accounted...

  • Page 35
    ...Alley, a website offering a directory of home service providers for consumers, including ratings and reviews, and that generates revenue through listing and couponing fees paid by the service providers. The Washington Post began offering its iPad application on a free trial basis in November of 2010...

  • Page 36
    ... primarily distributed by home delivery in Snohomish County and online at Heraldnet.com. The Daily Herald Company also provides commercial printing services and is a regional print site for USA TODAY. The Daily Herald Company also publishes The Enterprise, a weekly community newspaper home delivered...

  • Page 37
    ...of wire service copy, contributions from freelance writers and photographers and stories produced by the newspaper's own editorial staff. Television Broadcasting Post-Newsweek Stations, Inc. ("PNS"), a subsidiary of the Company, owns six television stations located in Houston, TX; Detroit, MI; Miami...

  • Page 38
    ... multiple channels of standard-definition television programming ("multicasting"), subchannels of programming designed for reception by mobile devices ("mobile DTV") and subscription video and data services known as "ancillary and supplementary" services. PNS, along with other broadcasting companies...

  • Page 39
    ... liberalized its daily newspaper/broadcast cross-ownership rule to presumptively allow newspaper/broadcast combinations in the 20 largest markets, subject to several fairly rigorous economic hardship and public interest criteria. A number of media companies and public interest groups have challenged...

  • Page 40
    ... are expected to air a specified number of hours of programming intended to serve the educational and informational needs of children and to complete reports on a quarterly basis concerning the children's programming that they broadcast. In addition, the FCC requires stations to limit the amount of...

  • Page 41
    ... are produced at The Daily Herald Company's plant in Everett, WA, while The Gazette Newspapers, Southern Maryland Newspapers, Express and the Fairfax County Times are printed at the commercial printing facilities owned by Post-Newsweek Media, Inc. Nine military papers, one free weekly and one paid...

  • Page 42
    ... service area, including both daily and weekly free-distribution newspapers. The Washington Post competes for readers and advertisers based on the quality of its journalism, the demographics and size of its subscriber base, advertising results and rates and customer service. The Post's website and...

  • Page 43
    ... businesses in financial services, real estate, technology and engineering in the United States and the United Kingdom. Mr. Jones has spent 20 years at The Washington Post Company and Kaplan, serving in a variety of senior management positions with a focus on finance, auditing and accounting...

  • Page 44
    ... to in Item 10 of this Annual Report on Form 10-K are each available on the Company's website; printed copies of such documents may be obtained by any stockholder upon written request to the Secretary of the Company at 1150 15th Street, NW, Washington, DC 20071. 28 THE WASHINGTON POST COMPANY

  • Page 45
    ... Such Funds During the Company's 2010 fiscal year, funds provided under the student financial aid programs created under Title IV accounted for approximately $1,460 million of the net revenues of the schools in Kaplan Higher Education. Any legislative, regulatory or other development that has the...

  • Page 46
    ...Adverse Effect on Kaplan's Business and Operations The Department of Education plans to issue final regulations in early 2011 that would impose additional eligibility requirements on educational programs that are subject to the requirement of preparing students for gainful employment in a recognized...

  • Page 47
    ... the U.S. Government Accountability Office (GAO) performed undercover tests at 15 for-profit higher education institutions, including 2 campuses of KHE. In August 2010, the GAO issued a report that was critical of the recruiting tactics at several schools, including the 2 Kaplan campuses. The GAO...

  • Page 48
    ... to participate in Title IV programs if student defaults on the repayment of Title IV loans exceed specified rates, referred to as "cohort default rates." The Department of Education calculates a cohort default rate for each of Kaplan Higher Education's OPEID numbers. The schools in an OPEID...

  • Page 49
    ... on its business and operations. • Failure to Correctly Calculate or Timely Return Title IV Funds for Students Who Withdraw Prior to Completing Programs Could Result in a Requirement to Post a Letter of Credit or Other Sanctions Department of Education regulations require schools participating in...

  • Page 50
    ... or to Participate in Federal Student Financial Aid Programs. If one or more of Kaplan Higher Education's schools experiences a change of control under the standards of applicable state agencies, accrediting agencies or the Department of Education, the schools governed by such agencies must seek...

  • Page 51
    ... publishing and television broadcasting businesses will be adversely affected to the extent that individuals decide to obtain news, entertainment, classified listings and local shopping information from Internet-based or other media to the exclusion of the Company's websites, print publications and...

  • Page 52
    ... shift advertising expenditures to other media outlets, the profitability of the Company's publishing and television broadcasting businesses will suffer. • Increased Competition Resulting From Technological Innovations in News, Information and Video Programming Distribution Systems The development...

  • Page 53
    ... a printing plant and distribution facility in Prince George's County, MD, that was built in 1998 on a 17-acre tract of land owned by WP Company. This property was sold in 2010. The Daily Herald Company owns its plant and office building in Everett, WA; it also owns two warehouses and a small rental...

  • Page 54
    ... February 12, 2010, request by the Department of Education for additional information and are fully cooperating with its Program Review. Kaplan has not received a final Program Review report from the Department of Education. The U.S. Attorney's Office has informed Kaplan Higher Education that it may...

  • Page 55
    ... The Company will vigorously defend this action. On February 7, 2011, Kaplan Higher Education Corporation received a Civil Investigative Demand from the Office of the Attorney General of the State of Illinois. The demand primarily seeks information pertaining to Kaplan University online students who...

  • Page 56
    ... include information relating to restricted stock grants awarded under The Washington Post Company Incentive Compensation Plan, which plan has been approved by the stockholders of the Company. At January 2, 2011, there were 8,855 shares of restricted stock outstanding under the 2007-2010 Award Cycle...

  • Page 57
    ...global provider of educational services to individuals, schools and businesses. The graph reflects the investment of $100 on December 31, 2005, in the Company's Class B Common Stock, the Standard & Poor's 500 Stock Index, the Standard & Poor's 1500 Publishing Index and the custom peer group index of...

  • Page 58
    ... timely decisions regarding required disclosure. Management's Report on Internal Control Over Financial Reporting Management's report set forth on page 61 is incorporated herein by reference. Changes in Internal Control Over Financial Reporting There has been no change in the Company's internal...

  • Page 59
    ... conduct applicable to the officers and persons referred to above by posting the required information on its Internet website. In addition to the certifications of the Company's Chief Executive Officer and Chief Financial Officer filed as exhibits to this Annual Report on Form 10-K, on June 18, 2010...

  • Page 60
    SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on March 2, 2011. THE WASHINGTON POST COMPANY (Registrant) By /s/ Hal S. Jones ...

  • Page 61
    ... TO FINANCIAL INFORMATION THE WASHINGTON POST COMPANY Management's Discussion and Analysis of Results of Operations and Financial Condition (Unaudited) ...Financial Statements: Management's Report on Internal Control Over Financial Reporting ...Report of Independent Registered Public Accounting Firm...

  • Page 62
    ... to a 6% decline in 2010. This follows a 23% print advertising decline at The Washington Post in 2009 and a 17% decline in 2008. Circulation volume also continued a downward trend, although revenues increased 4% due to home-delivery price increases. The Company's online publishing activities at...

  • Page 63
    ... 4%. Revenue growth at Kaplan accounted for the increase in education revenue. The increase in advertising revenue is due to increased revenues at the television broadcasting division and increases in newspaper publishing online revenue, offset by declines in print advertising at The Washington Post...

  • Page 64
    ... risk-free period) declined 8% compared to enrollments at December 31, 2009. A summary of KHE student enrollments at December 31, 2010, and December 31, 2009, is as follows: As of December 31, 2010 2009 Kaplan University ...Kaplan Higher Education Campuses ...% Change (4) (14) (8) Kaplan University...

  • Page 65
    ... Inc.'s corporate office and other minor shared activities. Corporate expenses declined in 2010, due largely to the reversal of incentive compensation accruals. Stock compensation relates to incentive compensation arising from equity awards under the Kaplan stock option plan. Kaplan recorded a stock...

  • Page 66
    ... in 2009. Display online advertising revenue grew 18% in 2010, and online classified advertising revenue on washingtonpost.com increased slightly in 2010. Daily circulation at The Washington Post declined 7.5% and Sunday circulation declined 8.2% in 2010. For 2010, average daily circulation at the...

  • Page 67
    ... to early retirement program expense at The Washington Post newspaper and the corporate office (after-tax impact of $50.1 million, or $5.27 per share); • $22.3 million in accelerated depreciation related to the planned closing of The Washington Post's College Park, MD, plant (after-tax impact...

  • Page 68
    ... 13%, advertising revenue decreased 18%, circulation and subscriber revenue increased 6% and other revenue increased 1%. Revenue growth at Kaplan accounted for the increase in education revenue. The decrease in advertising revenue is due to declines in print advertising at The Washington Post, as...

  • Page 69
    ... at Robinson Terminal Warehouse Corporation, and $1.1 million in early retirement program expense was recorded, also to be funded from the assets of the Company's pension plans. In the first quarter of 2008, a Voluntary Retirement Incentive Program was offered at The Washington Post, with 231 2010...

  • Page 70
    ... from the assets of the Company's pension plans. The Post closed its College Park, MD, printing plant in July 2009 and consolidated its printing operations in Springfield, VA. The Post is also in the process of consolidating certain other operations in Washington, DC. In connection with these...

  • Page 71
    ... of 2010, Kaplan completed the sale of Education Connection, which was part of the Kaplan Ventures division. During 2009, the Company acquired three businesses for $22.9 million. Kaplan acquired one business in each of its International and Test Preparation divisions, and the newspaper division...

  • Page 72
    ...for a possible write-down charge to the Company's Consolidated Statement of Operations. Common Stock Repurchases and Dividend Rate. During 2010, 2009 and 2008, the Company purchased a total of 1,057,940, 145,040 and 167,642 shares, respectively, of its Class B common stock at a cost of approximately...

  • Page 73
    ... guarantees, and these estimates are evaluated on an ongoing basis and adjusted as necessary. As Kaplan's businesses and related course offerings have expanded, including online programs, the complexity and significance of management's estimates have increased. Revenue from media advertising...

  • Page 74
    ... Company: (in millions) Education Higher education ...Test preparation ...Kaplan international ...Cable television ...Television broadcasting ...Total ...Goodwill $ 335.2 222.4 444.9 85.5 203.2 $1,291.2 As of November 30, 2010, in connection with the Company's annual impairment testing, the Company...

  • Page 75
    ... and growth rates were based on forecasts and long-term business plans and take into account numerous factors, including historical experience, anticipated economic conditions, changes in the cable television systems' cost structures, homes in each region's service area, number of subscribers based...

  • Page 76
    ...amortization outside the 10% corridor, and therefore, no amortized gain or loss amounts were included in the pension cost (credit) in 2010. During 2010, there were pension asset gains and a decrease in the discount rate. The Company currently estimates that there will be no net unamortized actuarial...

  • Page 77
    ... of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. The Company's management assessed the effectiveness of internal control over financial reporting as of January 2, 2011. In making this assessment, management used the criteria set forth...

  • Page 78
    ... of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was...

  • Page 79
    THE WASHINGTON POST COMPANY CONSOLIDATED STATEMENTS OF OPERATIONS Fiscal Year Ended (in thousands, except per share amounts) January 2, 2011 January 3, 2010 December 28, 2008 Operating Revenues Education ...Advertising ...Circulation and subscriber ...Other ...Operating Costs and Expenses ...

  • Page 80
    ... translation adjustment ...Unrealized gain on available-for-sale securities ...Unrealized gain (loss) on pensions and other postretirement plans ...Cost of 11,806,144 and 10,733,187 shares of Class B common stock held in treasury ...Total Common Shareholders' Equity ...Noncontrolling Interests...

  • Page 81
    ... write-down of property, plant and equipment ...Change in assets and liabilities: Decrease (increase) in accounts receivable, net ...Decrease (increase) in inventories ...Increase in accounts payable and accrued liabilities ...(Decrease) increase in deferred revenue ...(Decrease) increase in Kaplan...

  • Page 82
    THE WASHINGTON POST COMPANY CONSOLIDATED STATEMENTS OF CHANGES IN COMMON SHAREHOLDERS' EQUITY Unrealized Cumulative Unrealized Gain (Loss) Foreign Gain on on Pensions Currency Availableand Other Translation for-Sale Postretirement Adjustment Securities Plans $ 298,152 (in thousands) Balance, ...

  • Page 83
    ... businesses, the Company also publishes weekly publications and tabloids distributed within the Washington, DC, metropolitan area and elsewhere, and produces other websites and online magazines. Television broadcasting: The Company owns six VHF television stations located in Houston, TX; Detroit...

  • Page 84
    ..., based on estimates of advertising volumes for contract customers who are eligible for advertising rate adjustments and discounts. Investments in Marketable Equity Securities-The Company's investments in marketable equity securities are classified as available-for-sale and, therefore, are recorded...

  • Page 85
    ... subscriber fees for video, high-speed Internet and phone services, and from advertising. Cable subscriber revenue is recognized monthly as services are delivered. Advertising revenue is recognized when the commercials or programs are aired. Newspaper publishing and television broadcasting revenues...

  • Page 86
    ... exercise of options and restricted stock issuable under the Company's stock plans. Comprehensive Income-Comprehensive income consists of net income, foreign currency translation adjustments, the change in unrealized gains (losses) on investments in marketable equity securities and pension and other...

  • Page 87
    ... at January 2, 2011 and January 3, 2010, respectively. The changes in allowance for doubtful accounts and returns and allowance for advertising rate adjustments and discounts during 2010, 2009 and 2008 were as follows: Additions - Balance Balance at Charged to at Beginning Costs and End of...

  • Page 88
    ... businesses conducted on both a direct and reinsurance basis. Berkshire also owns approximately 21% of the common stock of the Company. The chairman, chief executive officer and largest shareholder of Berkshire, Mr. Warren Buffett, is a member of the Company's Board of Directors. The Washington Post...

  • Page 89
    ... of 2010, Kaplan completed the sale of Education Connection, which was part of the Kaplan Ventures division. During 2009, the Company acquired three businesses for $22.9 million. Kaplan acquired one business in each of its International and Test Preparation divisions, and the newspaper division...

  • Page 90
    The changes in the carrying amount of goodwill, by segment, during 2010 and 2009 were as follows: (in thousands) Education Cable Television $85,488 - 85,488 - - - - 85,488 - $85,488 - - - - Newspaper Publishing $ 81,186 (65,772) 15,414 - - - - 81,186 (65,772) $ 15,414 - - - (3) Television ...

  • Page 91
    ...79,902 $19,793 31,885 8,306 9,339 1,991 $71,314 (in thousands) Amortized intangible assets: Noncompete agreements ...Student and customer relationships ...Databases and technology ...Trade names and trademarks ...Other ... Useful Life Range 2-5 2-10 3-5 2-10 1-25 years years years years years $ 33...

  • Page 92
    ... been reclassified from previously reported income from operations and reported separately as loss from ... plant and equipment ...Prepaid pension cost ...Unrealized gain on available-for-sale securities...recorded at January 2, 2011 and January 3, 2010, respectively. The Company has approximately $523...

  • Page 93
    ... corporate income tax returns filed through 2006, and the Internal Revenue Service is not currently examining any of the post-2006 returns filed by the Company. The Company endeavors to comply with tax laws and regulations where it does business, but cannot guarantee that, if challenged, the Company...

  • Page 94
    ...Class B common stock at a cost of approximately $404.8 million, $61.0 million and $99.0 million, respectively. In September 2010, the Board of Directors increased the authorization to repurchase a total of 750,000 shares of Class B common stock. The Company did not announce a ceiling price or a time...

  • Page 95
    ... fair value of Kaplan's common stock is determined by the Company's compensation committee of the Board of Directors, and in January 2011, the committee set the fair value price at $1,450 per share. No options were awarded or exercised during 2010 or 2009. Kaplan recorded a stock compensation credit...

  • Page 96
    ... Washington Post newspaper and the corporate office; 236 employees accepted the offer; $82.8 million in early retirement program expense was recorded in 2008, also funded mostly from the assets of the Company's pension plans. The following table sets forth obligation, asset and funding information...

  • Page 97
    ...the plan is unfunded, the Company makes contributions to the SERP based on actual benefit payments. At January 2, 2011, future estimated benefit payments, excluding charges for early retirement programs, are as follows: (in millions) 2011 ...2012 ...2013 ...2014 ...2015 ...2016-2020 ...Pension Plans...

  • Page 98
    ...securities. In January 2011, the Company increased the limit on international stocks to no more than 22% of the assets at the time of the investment. None of the assets is managed internally by the Company. In determining the expected rate of return on plan assets, the Company considers the relative...

  • Page 99
    ... table sets forth obligation, asset and funding information for the Company's other postretirement plans at January 2, 2011 and January 3, 2010: (in thousands) Change in Benefit Obligation Benefit obligation at beginning of year ...Service cost ...Interest cost ...Amendments ...Actuarial (gain) loss...

  • Page 100
    ... of year ...Service cost plus interest cost ...1% Increase $5,674 $ 714 1% Decrease $(5,035) $ (616) The costs for the Company's postretirement plans are actuarially determined. The discount rates utilized to determine periodic cost for the years ended January 2, 2011, January 3, 2010 and December...

  • Page 101
    ...Local #200 Pension Fund. The complaint alleges that the Company and certain of its officers made materially false and misleading statements, or failed to disclose material facts relating to KHE, in violation of the U.S. Federal securities laws. The complaint seeks damages, attorneys' fees, costs and...

  • Page 102
    ... to participate in Title IV programs and subject the Company to financial penalties and refunds. DOE regulations require schools participating in Title IV programs to calculate correctly and return on a timely basis unearned Title IV funds disbursed to students who withdraw from a program of study...

  • Page 103
    ...Englishlanguage programs. Kaplan Ventures is made up of a number of businesses in various states of development that are managed separately from the other education businesses. In the first quarter of 2010, Kaplan made several minor changes to its operating and reporting structure: Kaplan Compliance...

  • Page 104
    ...systems offering video, Internet, phone and other services to subscribers in midwestern, western and southern states. The principal source of revenue is monthly subscription fees charged for services. Newspaper publishing includes the publication of newspapers in the Washington, DC, area and Everett...

  • Page 105
    Company information broken down by operating segment and education division: Fiscal Year Ended (in thousands) 2010 2009 2008 Operating revenues Education ...Cable television ...Newspaper publishing ...Television broadcasting ...Other businesses ...Corporate office ...Intersegment elimination ......

  • Page 106
    The Company's education division comprises the following operating segments: Fiscal Year Ended (in thousands) 2010 2009 2008 Operating revenues Higher education ...Test preparation1 ...Kaplan international ...Kaplan ventures2 ...Kaplan corporate and other ...Intersegment elimination ...Income (...

  • Page 107
    [THIS PAGE INTENTIONALLY LEFT BLANK] 2010 FORM 10-K 91

  • Page 108
    ... January 2, 2011 and January 3, 2010 are as follows: (in thousands, except per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter 2010 Quarterly Operating Results Operating Revenues Education ...Advertising ...Circulation and subscriber ...Other ...Operating Costs and Expenses...

  • Page 109
    ...Revenues Education ...Advertising ...Circulation and subscriber ...Other ...Operating Costs and Expenses Operating ...Selling, general and administrative ...Depreciation of property, plant...to the annual amounts reported in the Consolidated Statements of Operations due to rounding. 2010 FORM 10-K 93

  • Page 110
    ...) ...Charges of $21.0 million for accelerated depreciation related to the closing of The Washington Post's College Park, MD, plant and the consolidation of operations at The Washington Post newspaper ($8.3 million, $8.8 million and $3.8 million in the first, second and third quarters, respectively...

  • Page 111
    [THIS PAGE INTENTIONALLY LEFT BLANK] 2010 FORM 10-K 95

  • Page 112
    ... corporate office • $13.9 million ($1.48 per share) in accelerated depreciation related to the planned closing of The Washington Post's College Park, MD, plant • charges of $6.8 million ($0.72 per share) in connection with the restructuring of Test Preparation's professional training businesses...

  • Page 113
    ... share) on the sale of the Company's 50% interest in the International Herald Tribune • gain of $25.5 million ($2.66 per share) on sale of land at The Washington Post newspaper • charge of $20.8 million ($2.18 per share) for early retirement programs at The Washington Post newspaper • Kaplan...

  • Page 114
    [THIS PAGE INTENTIONALLY LEFT BLANK] 98 THE WASHINGTON POST COMPANY

  • Page 115
    ... by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated May 18, 2010).* The Washington Post Company Stock Option Plan as amended and restated effective May 31, 2003 (incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended...

  • Page 116
    ... comprint Printing Greater Washington Publishing gwpi.net apartment showcase ApartmentShowcase.com new Homes Guide NewHomesGuide.com sourcebook Retirement-Living.com newcondominiumGuide.com Robinson terminal Warehouse RobinsonTerminal.com Television Broadcasting Post-newsweek stations WDiv-Detroit...

  • Page 117
    ... report to shareholders. all of the company's sec filings are accessible from the company's website, washpostco.com. ANNUAL MEETING the annual meeting of stockholders will be held on May 12, 2011, at 9 a.m., at the Washington post company, 1150 15th street, nW, Washington, Dc. COMMON STOCK PRICES...

  • Page 118
    1150 15tH street, nW WasHington, Dc 20071 (202) 334-6000 WasHpostco.coM