Washington Post 2004 Annual Report Download - page 62

Accounts payable and accrued liabilities at January 2, 2005 and (expense), net'' in the Consolidated Statements of Income. For
December 28, 2003 consist of the following (in thousands): purposes of computing realized gains and losses, the cost basis of
securities sold is determined by specific identification.
2004 2003
Investments in Affiliates. The Company's investments in
Accounts payable and accrued expenses ÏÏÏÏÏÏ $229,380 $211,972 affiliates at January 2, 2005 and December 28, 2003 include
Accrued compensation and related benefits ÏÏÏÏ 204,225 147,985
the following (in thousands):
Due to affiliates (newsprint)ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 9,727 8,406
$443,332 $368,363
2004 2003
Book overdrafts of $27.2 million and $29.1 million are included in BrassRingÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 8,755 $11,892
accounts payable and accrued expenses at January 2, 2005 and Bowater Mersey Paper CompanyÏÏÏÏÏÏÏÏ 52,112 48,559
December 29, 2003, respectively. Los Angeles TimesÓWashington Post
News ServiceÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 947 861
C. INVESTMENTS $61,814 $61,312
Investments in Marketable Equity Securities. Investments At the end of 2004, the Company's investments in affiliates consist-
in marketable equity securities at January 2, 2005 and Decem- ed of a 49.3% interest in BrassRing LLC, an Internet-based hiring
ber 28, 2003 consist of the following (in thousands): management company; a 49% interest in the common stock of
2004 2003 Bowater Mersey Paper Company Limited, which owns and operates
a newsprint mill in Nova Scotia; and a 50% common stock interest
Total cost ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $285,912 $186,954 in the Los Angeles TimesÓWashington Post News Service, Inc.
Net unrealized gains ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 123,824 61,004
Summarized financial data for the affiliates' operations are as
Total fair value ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $409,736 $247,958
follows (in thousands):
At January 2, 2005 and December 28, 2003, the Company's
2004 2003 2002
ownership of 2,634 shares of Berkshire Hathaway Inc. (""Berk-
shire'') Class A common stock and 9,845 shares of Berkshire Financial Position
Class B common stock accounted for $260.4 million or 64% and Working capital ÏÏÏÏÏÏÏÏ $ 9,014 $ 11,108 $ 10,366
$245.3 million or 99%, respectively, of the total fair value of the Property, plant and
equipment ÏÏÏÏÏÏÏÏÏÏÏ 137,321 140,917 135,013
Company's investments in marketable equity securities.
Total assetsÏÏÏÏÏÏÏÏÏÏÏÏ 202,904 214,658 235,208
Berkshire is a holding company owning subsidiaries engaged in a Long-term debtÏÏÏÏÏÏÏÏÏ ÌÌÌ
number of diverse business activities, the most significant of which Net equityÏÏÏÏÏÏÏÏÏÏÏÏÏ 155,147 149,584 138,723
consist of property and casualty insurance business conducted on Results of Operations
both a direct and reinsurance basis. Berkshire also owns approxi- Operating revenues ÏÏÏÏ $221,618 $174,505 $263,709
mately 18% of the common stock of the Company. The chairman, Operating income
(loss) ÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 1,695 (18,753) (21,725)
chief executive officer and largest shareholder of Berkshire,
Net lossÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (4,577) (20,164) (36,326)
Mr. Warren Buffett, is a member of the Company's Board of
Directors. Neither Berkshire nor Mr. Buffett participated in the The following table summarizes the status and results of the Compa-
Company's evaluation, approval or execution of its decision to ny's investments in affiliates (in thousands):
invest in Berkshire common stock. The Company's investment in
2004 2003
Berkshire common stock is less than 1% of the consolidated equity
of Berkshire. At January 2, 2005 and December 28, 2003, the Beginning investment ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $61,312 $ 70,703
unrealized gain related to the Company's Berkshire stock investment Additional investmentÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì5,976
Equity in losses ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (2,291) (9,766)
totaled $75.5 million and $60.4 million, respectively. The Compa-
Dividends and distributions received ÏÏÏÏÏÏ (800) (750)
ny presently intends to hold the Berkshire common stock investment
Foreign currency translationÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 3,593 9,205
long term, thus the investment has been classified as a non-current Sale of interest ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì(14,056)
asset in the Consolidated Balance Sheets. Ending investmentÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $61,814 $ 61,312
The Company made $94.6 million in investments in marketable In December 2001, BrassRing, Inc. was restructured and the Com-
equity securities in 2004. There were no investments in marketable pany's interest in BrassRing, Inc. was converted into an interest in
equity securities in 2003 and 2002. During 2004 and 2003, there the newly-formed BrassRing LLC. At December 30, 2001, the
were no sales of marketable equity securities or realized gains Company held a 39.7% interest in the BrassRing LLC common equity
(losses). During 2002, proceeds from sales of marketable equity and a $14.9 million Subordinated Convertible Promissory Note
securities were $19.7 million, and gross realized gains (losses) on (""Note'') from BrassRing LLC. In February 2002, the Note was
such sales were $13.2 million. During 2003 and 2002, the converted into Preferred Units, which are convertible at the Compa-
Company recorded write-downs on marketable equity securities of ny's option to BrassRing LLC common equity. Assuming the conver-
$0.2 million and $2.0 million, respectively. Realized gains or losses sion of the Preferred Units, the Company's common equity interest in
on marketable equity securities are included in ""Other income BrassRing LLC would have been approximately 49.5%. BrassRing
46 THE WASHINGTON POST COMPANY