Washington Post 2001 Annual Report Download

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Financial Contents
Management’s Discussion and
Analysis of Results of Operations
and Financial Condition 29
Consolidated Statements of Income 37
Consolidated Statements of
Comprehensive Income 37
Consolidated Balance Sheets 38
Consolidated Statements of
Cash Flows 40
Consolidated Statements of Changes
in Common Shareholders’ Equity 41
Notes to Consolidated Financial
Statements 42
Report of Independent Accountants 55
Ten-Year Summary of Selected
Historical Financial Data 56
Corporate Directory 58

Table of contents

  • Page 1
    Financial Contents Management's Discussion and Analysis of Results of Operations and Financial Condition... Shareholders' Equity Notes to Consolidated Financial Statements Report of Independent Accountants Ten-Year Summary of Selected Historical Financial Data Corporate Directory 56 58 42 55 41 40 37...

  • Page 2
    ..., or $1.74 per share, arising from an early retirement program at The Washington Post. Revenue for 2001 totaled $2,416.7 million, or flat compared to revenue of $2,412.2 million in 2000. Advertising revenue decreased 13 percent in 2001, and circulation and subscriber revenue increased 10 percent...

  • Page 3
    ... 2000. The decline in 2001 operating income resulted from a 24 percent decrease in advertising revenue at Newsweek due to fewer advertising pages at both the domestic and international editions. The decline was offset in part by increased newsstand sales on regular and special editions related to...

  • Page 4
    ... Company's affiliate investments consist of a 39.7 percent common equity interest in BrassRing LLC, a 50 percent interest in the International Herald Tribune, and a 49 percent interest in Bowater Mersey Paper Company Limited. BrassRing accounted for approximately $75.1 million of the 2001 equity in...

  • Page 5
    ... spending on marketing and sales initiatives at washingtonpost.com, an 8 percent increase in newsprint expense, and a reduced pension credit, offset in part by higher advertising revenues. Daily circulation remained unchanged at The Washington Post; Sunday circulation declined 1 percent. Revenue...

  • Page 6
    .... The Company's affiliate investments consisted of a 42 percent effective interest in BrassRing, Inc. (formed in late September 1999), a 50 percent interest in the International Herald Tribune, and a 49 percent interest in Bowater Mersey Paper Company Limited. The decline in 2000 affiliate results...

  • Page 7
    ... Corporation, and amounts paid as part of a cable system exchange with AT&T Broadband. During 2001, the Company also acquired a provider of CFA exam preparation services and a company that provides pre-certification training for real estate, insurance, and securities professionals. Southern Maryland...

  • Page 8
    .... Accounts receivable have also been reduced by an estimate of advertising rate adjustments and discounts, based on estimates of advertising volumes for contract customers that are eligible for advertising rate adjustments and discounts. Pension Costs. Excluding expenses related to early retirement...

  • Page 9
    ... compensation committee has historically modified the fair value of Kaplan stock on an annual basis, and management expects this practice to continue. At December 30, 2001, options representing 10.0 percent of Kaplan's common stock were issued and outstanding. For 2001, 2000, and 1999, the Company...

  • Page 10
    ... OF INCOME T H E W A S H I N G T O N P O S T C O M PA N Y (in thousands, except per share amounts) December 30, 2001 Fiscal year ended December 31, 2000 January 2, 2000 Operating Revenues Advertising ...$ 1,209,327 Circulation and subscriber ...658,620 Education ...493,271 Other ...55,455...

  • Page 11
    CONSOLIDATED BALANCE SHEETS (in thousands) Assets Current Assets Cash and cash equivalents ...$ Investments in marketable equity securities ...Accounts receivable, net ...Federal and state income taxes ...Inventories ...Other current assets ... 31,480 16,366 279,328 10,253 19,042 40,388 396,857 ...

  • Page 12
    ...N P O S T C O M PA N Y (in thousands, except share amounts) December 30, 2001 December 31, 2000 Liabilities and Shareholders' Equity Current Liabilities Accounts payable and accrued liabilities ...$ Deferred subscription revenue ...Short-term borrowings ... 298,565 85,525 50,000 434,090 130,824...

  • Page 13
    ... ...78,933 Net pension benefit ...(76,945) Early retirement program expense ...3,344 Gain from sale or exchange of certain businesses ...(321,091) Loss (gain) on disposition of marketable equity securities and cost method investments, net ...511 Cost method investment and other write-downs...

  • Page 14
    ... (net of taxes) ...Change in unrealized gain on available-for-sale securities (net of taxes) ...Conversion of Class A common stock to Class B common stock ...Tax benefits arising from employee stock plans . . Balance, December 30, 2001... $ 2,854,122 229,639 (53,114) (1,052) $ (6,574) $ 13,502...

  • Page 15
    ... issued financial state- accounting for its minority investments in non-public companies where it does not have significant influence over the operations and management of the investee. Investments are recorded at the lower of cost or fair value as estimated by management. Charges recorded to...

  • Page 16
    ... anticipated sales returns. Cable subscriber revenue is recognized monthly as services are delivered. Education revenue is recognized ratably over the period during which educational services are delivered. T H E W A S H I N G T O N P O S T C O M PA N Y New Accounting Pronouncements. In July 2001...

  • Page 17
    ... International Herald Tribune ...14,480 Other...642 $ 80,936 $ 73,310 40,227 17,561 531 $ 131,629 The Company's investments in affiliates consist of a 39.7 percent common equity interest in BrassRing LLC, which provides recruiting, career development, and hiring management services for employers...

  • Page 18
    ..., to write-down cost method investments to estimated fair value. Charges recorded to writedown cost method investments are included in "Other income (expense), net" in the Consolidated Statements of Income. During 2001 and 2000, proceeds from sales of cost method investments were $451,000 and $7,070...

  • Page 19
    ... of such stock have a right to require the Company to purchase their shares at the redemption price during an annual 60-day election period; the first such period began on February 23, 2001. Dividends on the Series A Preferred Stock are payable four times a year at the annual rate of $80.00 per...

  • Page 20
    ... if the participant's employment terminates before the end of a specified period of service to the Company. At December 30, 2001, there were 70,775 shares reserved for issuance under the incentive compensation plan. Of this number, 29,895 shares were subject to awards outstanding, and 40,880...

  • Page 21
    ... exercises totaled $2.1 million. At December 30, 2001, the Company's stock-based compensation accrual balance totaled $41.4 million. Average Number of Shares Outstanding. Basic earnings per share are Benefit obligation at beginning of year Service cost Interest cost Amendments Actuarial loss (gain...

  • Page 22
    ... Corporation, and amounts paid as part of a cable system exchange with AT&T Broadband. During 2001, the Company also acquired a provider of CFA exam preparation services and a company that provides pre-certification training for real estate, insurance, and securities professionals. Southern Maryland...

  • Page 23
    ... on January 11, 2001, the Company completed the sale of a cable system serving about 15,000 subscribers in Greenwood, Indiana, for $61.9 million. The gain resulting from the cable system sale and exchange transactions increased net income by $196.5 million, or $20.69 per share. For income tax...

  • Page 24
    ... and three international editions, the publication of a travel magazine, and the publication of business periodicals for the computer services industry and the Washington-area technology community. Revenues from both newspaper and magazine publishing operations are derived from advertising and, to...

  • Page 25
    ... Education Other Businesses and Corporate Office Consolidated Operating revenues ...Income (loss) from operations ...Equity in losses of affiliates ...Interest expense, net ...Other income, net ...Income before income taxes ...Identifiable assets ...Investments in marketable equity securities...

  • Page 26
    ..., 2000 are as follows: (in thousands, except per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter 2001 Quarterly Operating Results Operating revenues Advertising ...Circulation and subscriber ...Education ...Other...Operating costs and expenses Operating ...Selling, general...

  • Page 27
    (in thousands, except per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter 2000 Quarterly Operating Results Operating revenues Advertising ...Circulation and subscriber ...Education ...Other...Operating costs and expenses Operating ...Selling, general, and ...

  • Page 28
    ..., the consolidated financial statements appearing on pages 37 through 54 of this report present fairly, in all material respects, the financial position of The Washington Post Company and its subsidiaries at December 30, 2001 and December 31, 2000, and the results of their operations and their...

  • Page 29
    TEN-YEAR SUMMARY OF SELECTED HISTORICAL FINANCIAL DATA (in thousands, except per share amounts) 2001 2000 1999 Results of Operations Operating revenues ...Income from operations ...Income before cumulative effect of change in accounting principle ...Cumulative effect of change in method of ...

  • Page 30
    T H E W A S H I N G T O N P O S T C O M PA N Y 1998 1997 1996 1995 1994 1993 1992 $ 2,110,360 $ 378,897 $ 417,259 - $ 417,259 $ 1,956,253 $ 381,351 $ 281,574 - $ 281,574 $ 1,853,445 $ 337,169 $ 220,817 - $ 220,817 $ 1,719,449 $ 271,018 $ 190,096 - $ 190,096 $ 1,613,978 $ 274,875 $ 169,...

  • Page 31
    CORPORATE DIRECTORY Donald E. Graham (3, 4) Chairman of the Board and Chief Executive Officer Chairman, The Washington Post Patrick Butler Vice President Diana M. Daniels Warren E. Buffett (3, 4) Chairman of the Board, Berkshire Hathaway Inc. Vice President, General Counsel, and Secretary Hal S....