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THE WASHINGTON
POST COMPANY
2007 Annual Report

Table of contents

  • Page 1
    THE WASHINGTON 2007 Annual Report POST COMPANY

  • Page 2
    CONTENTS Financial Highlights p.1 Letter to Shareholders p. 3 Form 10-K

  • Page 3
    ... (in thousands, except per share amounts) 2007 2006 % Change Operating revenue Income from operations Net income Diluted earnings per common share Dividends per common share Common shareholders' equity per share Diluted average number of common shares outstanding $ 4,180,406 $ $ $ $ $ 477...

  • Page 4

  • Page 5
    ... and increasingly international education business unlike any other education company in the world. For the last six months of the year, Kaplan's revenue was almost half of the company's, at 49%. Kaplan will continue to grow stronger in 2008. The Washington Post Company is now an education and media...

  • Page 6
    ...Online High School; and the financial training assets of FINSIA, in Australia. In 2007, we made our largest step into China, investing in a respected higher education company, ACE Education; early in 2008, we exercised an option to increase our investment to a majority stake. 4 The Washington Post...

  • Page 7
    ... U.S. or overseas. Kaplan and The Post Company have two mutual advantages: we can reinvest the money we earn from all our business in education (as long as sensible deals are available), and Kaplan is free to invest for the long run without caring about the effect on quarterly 2007 Annual Report 5

  • Page 8
    ... asked if Kaplan is a counter-cyclical business. The company contains both cyclical and counter-cyclical elements. (We were making $20 million from a real estate training business two years ago; it will be a long time before we see that profit level again.) Both higher education and test prep should...

  • Page 9
    ...-over to digital broadcasting. Alan Frank's management of Post-Newsweek Stations produced some important pluses: number-one stations in early and late news in San Antonio and Jacksonville, continuing improvement in Orlando and a surprise in Miami, where Dave Boylan's astute changes in program lineup...

  • Page 10
    ... when looking for a job, a car or a house, they automatically bought a paper and shopped the classifieds. These mutually reinforcing habits lately have been working in reverse. The ads still work, and the reporters still gather news; but fewer readers buy the paper, and advertisers have more choices...

  • Page 11
    ...the Army and a change of command at Walter Reed) improved the wounded soldiers' care and demonstrated the impact of the stories. What we need is clear: we need to continue to publish the best newspaper we can and to redouble our efforts at making The Post's site the best online news source - both in...

  • Page 12
    ... the largest-circulation paper in any city was a valuable business. No newspaper-plus-Internet business is succeeding today by dominating its market, no matter how big. The Post has a unique chance to be the largest source of Internet news in the Washington area and a substantial national news force...

  • Page 13
    ... helped make the decade of the 1980s the best years from a business point of view both for the Company and for me...Working became a pleasure again. During his tenure, earnings per share grew at an annual compounded rate of 22.5% and return on equity averaged 26%." We're lucky enough to add two more...

  • Page 14

  • Page 15
    ... Employer Identification No.) 1150 15th 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 Class B Common Stock...

  • Page 16
    THE WASHINGTON POST COMPANY 2007 FORM 10-K PART I ... Item 1. Item Item Item Item Item 1A. 1B. 2. 3. 4. Business ...Education ...Newspaper Publishing ...Television Broadcasting ...Magazine Publishing ...Cable Television Operations ...Other Activities ...Production and Raw Materials ...Competition...

  • Page 17
    ...Learning Services; Kaplan Publishing and Score! Test Prep prepares students for a broad range of admissions examinations, including the SAT, ACT, LSAT, GMAT, MCAT and GRE, that are required for admission to college and graduate schools, including medical, business and law schools. During 2007, these...

  • Page 18
    ... programs. APMI had more than 4,250 students enrolled at year-end 2007. In 2007, Kaplan acquired a minority interest in Shanghai Kai Bo Education Investment Management Co., Ltd. ("ACE Education"), an education company headquartered in Shanghai, China. In February 2008, Kaplan exercised an option...

  • Page 19
    ... universities), ACE Education also offers programs at the SinoBritish College in Shanghai. ACE Education had approximately 1,600 students enrolled at year-end. In 2007, Professional acquired the education business of the Financial Services Institute of Australasia ("FINSIA"), which is headquartered...

  • Page 20
    ... Act of 1965, as amended, historically have been responsible for a majority of the net revenues of Kaplan Higher Education. During 2007, funds received under the Title IV programs accounted for approximately $745 million, or approximately 73%, of total Kaplan Higher Education revenues. The Company...

  • Page 21
    ... continued to comply with Title IV requirements. The largest Title IV reporting unit in the Higher Education Division in terms of revenue is Kaplan University, which accounted for approximately 48% of the Title IV funds received by the Division in 2007. For the most recent year for which final data...

  • Page 22
    ... from The Washington Post edited for a national audience. The National Weekly Edition has a basic subscription price of $78 per year and is delivered by second-class mail to approximately 26,400 subscribers. The Post has about 596 full-time editors, reporters and photographers on its staff; draws...

  • Page 23
    ... newspaper named Express, which is distributed free of charge using hawkers and news boxes near Metro stations and in other locations in Washington, D.C. and nearby suburbs with heavy daytime sidewalk traffic. A typical edition of Express is 45 to 60 pages long and contains short news, entertainment...

  • Page 24
    ... to the Classified Ventures' national car and apartment rental websites ( www.cars.com and www.apartments.com ). WPNI uses software from Classified Ventures to host washingtonpost.com's online listing of residential real estate for sale in the greater Washington, D.C., area, and Classified Ventures...

  • Page 25
    ... a weekly Spanish-language newspaper that is distributed free of charge in northern Virginia, suburban Maryland and Washington, D.C., using sidewalk news boxes and retail locations that provide space for distribution. El Tiempo Latino provides a mix of local, national and international news together...

  • Page 26
    ...the Company's television stations: Station Location and Year Commercial Operation Commenced National Market Ranking (a) Network Affiliation Expiration Date of FCC License Expiration Date of Network Agreement Total Commercial Stations in DMA (b) Allocated Operating KPRC Houston, TX 1949 WDIV Detroit...

  • Page 27
    ... November 2007, the FCC imposed new public interest obligations for broadcasters. Among other changes, the FCC announced that it will require broadcasters to report on the amount and type of public interest programming they offer and to make their public inspection files available over the Internet...

  • Page 28
    ... certain syndicated programming must be borne by the broadcast stations themselves. Carriage of Local Broadcast Signals. Pursuant to the "must-carry" requirements of the Cable Television Consumer Protection and Competition Act of 1992 (the "1992 Cable Act"), a commercial television broadcast station...

  • Page 29
    ... act. Commercial broadcast stations sell advertising time through a number of methods, and some stations use third-party brokers to sell otherwise unused inventory at below-market prices. The FCC is currently considering a request that it declare that such sales, when made through Internet brokers...

  • Page 30
    ... of the total weekly domestic circulation rate base of the three leading weekly news magazines will be 33.1%. Newsweek is sold on newsstands and through subscription mail order sales derived from a number of sources, principally direct mail promotion. The basic one-year subscription price is $41.08...

  • Page 31
    ...other international, business or national coverage primarily of interest abroad. Newsweek estimates that the combined average weekly paid circulation for these English-language international editions of Newsweek in 2007 was approximately 450,000 copies. Since 1984, a section of Newsweek articles has...

  • Page 32
    ... introduction of its voice over Internet protocol ("VoIP"), or digital telephone, service in 2007. At year-end, Cable ONE provided VoIP service to 58,640 customers, and the service is currently available to 90% of the homes passed. In December 2006, Cable ONE purchased in the FCC's Advanced Wireless...

  • Page 33
    ... several states in which the Company has cable operations have so certified. A number of cable operators (including the Company's Cable ONE subsidiary) are using their cable systems to provide not only television programming, but also Internet access and digital telephony. In 2002, the U.S. Supreme...

  • Page 34
    ... services that deliver full-length television programs or video clips directly to cellular telephones, although at present, these services are capable of supporting only a limited number of available video streams. During 2008, the FCC will auction off the 700 MHz 18 THE WASHINGTON POST COMPANY

  • Page 35
    ... a television broadcast station and a cable television system in the same market. Set-Top Boxes. In the interests of trying to promote competition in the market for set-top converter boxes, effective July 1, 2007, FCC rules require cable operators to support converter boxes and digital television...

  • Page 36
    ...obscenity and a ban on unsolicited commercial e-mail. Online content provided by the Company is also subject to these laws. Voice Services Voice Over Internet Protocol. Cable companies (including the Company's Cable ONE subsidiary) and others offer telephone service using a technology known as voice...

  • Page 37
    ...annual regulatory fee assessment. The order's effective date has not yet been established. Local Number Portability. In a November 2007 order, the FCC required interconnected VoIP service providers and their "numbering partners" to ensure that their customers have the ability to port their telephone...

  • Page 38
    ...newspapers). Greater Washington Publishing's periodicals are produced by independent contract printers. The Post has announced plans to close its printing plant located in College Park, MD, in 2010 after moving two printing presses to its Springfield, VA, plant. In 2007, The Washington Post, Express...

  • Page 39
    ... and nationally circulated newspapers), and from websites, television, radio, magazines and other advertising media, including direct mail advertising. Express similarly competes with various other advertising media in its service area, including both daily and weekly free-distribution newspapers...

  • Page 40
    ... (which also has a weekly paid-circulation edition); and The Frederick News-Post and Carroll County Times, daily paid-circulation community newspapers. The Southern Maryland Newspapers circulate in southern Prince George's County and in Charles, Calvert and St. Mary's Counties, MD, where they also...

  • Page 41
    ... DirecTV and EchoStar in most markets in which the Company provides cable television service. News Corp. is a global media company that in the United States owns the Fox Television Network, 35 broadcast television stations, a group of regional sports networks and a number of nationally distributed...

  • Page 42
    ... predict the rate at which overbuilding will occur. Even without constructing their own cable plant, local telephone companies can also compete with cable television systems in the delivery of high-speed Internet access by providing DSL service. In addition, some telephone companies have entered...

  • Page 43
    ... as a result of the program. Post-Newsweek Media, Inc. has approximately 492 full-time and 190 part-time employees. Robinson Terminal Warehouse Corporation (the Company's newsprint warehousing and distribution subsidiary), Greater Washington Publishing, Inc., Express Publications Company, LLC and El...

  • Page 44
    ... Changes in the Terms on Which Such Funds Are Made Available During the Company's 2007 fiscal year, funds provided under the student financial aid programs created under Title IV of the Federal Higher Education Act accounted for approximately $745 million of the net revenues of the schools in Kaplan...

  • Page 45
    ... locations or, in states that require it for Kaplan University online, could have a material adverse effect on Kaplan Higher Education's business. • Changes in the Extent to Which Standardized Tests Are Used in the Admissions Process by Colleges or Graduate Schools A substantial portion of Kaplan...

  • Page 46
    ... Texas School of Business; and a 35,000-square-foot building in London, U.K. and a 2,200-square-foot building in Oxfordshire, U.K., each of which is used by Holborn College. Kaplan University's corporate offices together with a data center, call center and employee-training facilities are located in...

  • Page 47
    ... NJ, to house its accounting, production and distribution departments. The lease on this space will expire on July 31, 2012, but is renewable for two 5-year periods at Newsweek's option. The headquarters offices of the Cable Television Division are located in a three-story office building in Phoenix...

  • Page 48
    ...near The Washington Post's Virginia printing plant and include several warehouses. In 1992, Robinson purchased approximately 23 acres of undeveloped land on the Potomac River in Charles County, MD, for the possible construction of additional warehouse capacity. The offices of Washingtonpost.Newsweek...

  • Page 49
    ... and Holders The Company's Class B Common Stock is traded on the New York Stock Exchange under the symbol "WPO." The Company's Class A Common Stock is not publicly traded. The high and low sales prices of the Company's Class B Common Stock during the last two years were: Quarter 2007 High Low High...

  • Page 50
    ... Washington Post Company, and also is weighted by market capitalization. The custom peer group of education companies includes Apollo Group Inc., Capella Education Co., Career Education Corp., Corinthian Colleges, Inc., DeVry Inc., ITT Educational Services Inc. and Strayer Education Inc. The Company...

  • Page 51
    ... investments it held at the time and would increase the Company's interest expense on any commercial paper it had outstanding at the time. Assuming a hypothetical 100 basis point increase in the average interest rate on the Company's commercial paper borrowings during 2007, the Company's interest...

  • Page 52
    ... audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report included herein. Changes in Internal Control Over Financial Reporting Effective October 1, 2007, the Company implemented a new system for advertising and billing for the majority of...

  • Page 53
    ... Chief Financial Officer filed as exhibits to this Annual Report on Form 10-K, on June 6, 2007, the Company's Chief Executive Officer submitted to the New York Stock Exchange the annual certification regarding compliance with the NYSE's corporate governance listing standards required by Section 303A...

  • Page 54
    ..., Jr. and Veronica Dillon, and each of them, to sign all reports required to be filed by the Registrant pursuant to the Securities Exchange Act of 1934 on behalf of the above-named directors and officers has been filed with the Securities and Exchange Commission. 38 THE WASHINGTON POST COMPANY

  • Page 55
    INDEX TO FINANCIAL INFORMATION THE WASHINGTON POST COMPANY Management's Discussion and Analysis of Results of Operations and Financial Condition (Unaudited) ...Financial Statements and Schedules: Report of Independent Registered Public Accounting Firm ...Consolidated Statements of Income and ...

  • Page 56
    ... declines in real estate, classified, national and retail. This follows a 4% print advertising revenue decline at The Washington Post in 2006. Circulation volume also continued a downward trend. The Company's online publishing businesses, Washingtonpost.Newsweek Interactive and Slate, reported an 11...

  • Page 57
    ...6% decline in Newsweek circulation revenue due to subscription rate declines at the domestic and international editions of Newsweek. Revenue growth at Kaplan (about 38% of which was from acquisitions) accounted for the increase in education revenue. Operating costs and expense for the year increased...

  • Page 58
    ... to an agreement to settle a Higher education includes Kaplan's domestic and international post-secondary education businesses, including fixed-facility colleges, as well as online post-secondary and career programs. Higher education revenue grew by 19% for 2007. Enrollments increased 11% to 80,000...

  • Page 59
    .... The Company also announced that The Post will close its College Park, MD, printing plant in early 2010, after two presses are moved to The Post's Springfield, VA, plant. Television Broadcasting Division. Revenue for the television broadcasting division decreased 6% to $340.0 million in 2007, from...

  • Page 60
    .... Through its search engine marketing expertise and proprietary technology platform, CourseAdvisor generates student leads for the post-secondary education market. CourseAdvisor operates as an independent subsidiary of the Company. In 2007, other businesses and corporate office included the expenses...

  • Page 61
    ... at the cable and television broadcasting divisions, and a small increase at the newspaper publishing division, offset by a decline at the magazine publishing division. Advertising revenue increased 3% in 2006, and circulation and subscriber revenue increased 4%. Education revenue increased 19% in...

  • Page 62
    ... domestic edition and international editions of Newsweek and subscription rate base declines at certain of the international editions. Revenue growth at Kaplan, Inc. (about 31% of which was from acquisitions) accounted for the increase in education revenue. Operating costs and expenses for the year...

  • Page 63
    ... buyouts at The Washington Post and a decrease in print advertising at The Post, offset by improved results at the division's online publishing activities, both washingtonpost.com and Slate, and a $2.3 million pre-tax gain on the sale of property. Operating income at the newspaper division was also...

  • Page 64
    ... of a 30-day service credit to all of its 94,000 pre-hurricane Gulf Coast subscribers. Offsetting these items, a $5.0 million insurance recovery was recorded for part of the hurricane losses through December 31, 2005 under the Company's property and business interruption insurance program (this was...

  • Page 65
    ...2007, the Company acquired the outstanding stock of CourseAdvisor Inc., a premier online lead generation provider, headquartered in Wakefield, MA. Through its search engine marketing expertise and proprietary technology platform, CourseAdvisor generates student leads for the post-secondary education...

  • Page 66
    ...there were no share repurchases. At December 30, 2007, the Company had authorization from the Board of Directors to purchase up to 410,994 shares of Class B common stock. The annual dividend rate for 2008 was increased to $8.60 per share, from $8.20 per share in 2007 and from $7.80 per share in 2006...

  • Page 67
    ... Accounts and Allowances. The Company's revenue recognition policies are described in Note A to the Consolidated Financial Statements. Education revenue is recognized ratably over the period during which educational services are delivered. At Kaplan's test prep division, estimates of average student...

  • Page 68
    ...share value. In the first quarter of 2007 and second quarter of 2006, 2,175 and 2,619 shares were issued related to the 2006 and 2005 Kaplan share awards. In the fourth quarter of 2007, a senior manager exercised Kaplan stock options and received 1,750 Kaplan shares. 52 THE WASHINGTON POST COMPANY

  • Page 69
    ...of the change in accounting under SFAS 123R. In 2007, 2006 and 2005, total net payouts were $8.1 million, $31.1 million and $35.2 million, respectively. At December 30, 2007, the Company's accrual balance related to Kaplan stock-based compensation totaled $101.2 million. If Kaplan's profits increase...

  • Page 70
    REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of The Washington Post Company: In our opinion, the consolidated financial statements referred to under Item 15 (1) on page 37 and listed in the index on page 39 present fairly, in all material ...

  • Page 71
    CONSOLIDATED STATEMENTS OF INCOME Fiscal Year Ended (in thousands, except per share amounts) December 30, 2007 December 31, 2006 January 1, 2006 Operating Revenues Education ...Advertising ...Circulation and subscriber ...Other ...Operating Costs and Expenses Operating ...Selling, general and ...

  • Page 72
    ...2007 December 31, 2006 (in thousands) Assets Current Assets Cash and cash equivalents ...Investments in marketable equity securities Accounts receivable, net ...Deferred income taxes ...Inventories ...Other current assets ...Property, Plant...the financial statements. 56 THE WASHINGTON POST COMPANY

  • Page 73
    (In thousands, except share amounts) December 30, 2007 December 31, 2006 Liabilities and Shareholders' Equity Current Liabilities Accounts payable and accrued liabilities . Income taxes ...Deferred revenue ...Short-term borrowings ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...

  • Page 74
    ... ...Issuance (repayment) of commercial paper, net...Dividends paid ...Common shares repurchased ...Proceeds from exercise of stock options ...Principal payments on debt ...Cash overdraft ...Other ... Net cash used in financing activities ...Effect of Currency Exchange Rate Change ...Net (Decrease...

  • Page 75
    ... of 25,459 shares of Class B common stock, net of restricted stock award forfeitures ...Amortization of unearned stock compensation ...Change in foreign currency translation adjustment (net of taxes) ...Change in unrealized gain on available-for-sale securities (net of taxes) ...Stock option expense...

  • Page 76
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Fiscal Year. The Company reports on a 52- to 53-week fiscal year ending on the Sunday nearest December 31. The fiscal years 2007, 2006 and 2005, which ended on December 30, 2007, December 31, 2006 and January ...

  • Page 77
    ... underlying advertisement is published or broadcast. Revenues from newspaper and magazine subscriptions and retail sales are recognized upon the later of delivery or cover date, with adequate provision made for anticipated sales returns. Cable subscriber revenue is recognized monthly as services are...

  • Page 78
    ..., plant and equipment. During 2007, the Company acquired 11 businesses within its Kaplan, Newspaper, and Other Businesses and Corporate Office segments for a total cost of $292.0 million, financed with cash and $2.0 million in debt. Kaplan acquired 9 businesses in its higher education, test prep...

  • Page 79
    ...The Kidum Group, the leading provider of test preparation services in Israel; and Asia Pacific Management Institute, a private education provider for undergraduate and postgraduate students in Asia. In addition, on January 14, 2005, the Company completed the acquisition of Slate, the online magazine...

  • Page 80
    ... assets during 2007 was as follows (in thousands): Goodwill, Net Foreign Currency Exchange Rate Beginning of and Other Year Acquisitions Education ...$ 845,754 Newspaper Publishing ...Television Broadcasting . . Magazine Publishing ...Cable Television ...Other Businesses and Corporate Office ...79...

  • Page 81
    ...the equity in earnings (losses) of this affiliate investment should be recorded at a 35% tax rate. The Company concluded that this charge is not material to the Company's financial positions or results of operations for 2007 and prior years, based on its consideration of quantitative and qualitative...

  • Page 82
    ...five years. The Company files income tax returns in the U.S. and various state and foreign jurisdictions, with the U.S. Federal considered the only major tax jurisdiction. In January 2007, the Internal Revenue Service (IRS) completed their examinations of the Company's consolidated federal corporate...

  • Page 83
    ... holders 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...

  • Page 84
    ...straight-line basis over a weighted average period of 1.9 years. Stock Options. The Company's employee stock option plan reserves 1,900,000 shares of the Company's Class B common stock for options to be granted under the plan. The purchase price of the shares covered by an option cannot be less than...

  • Page 85
    ... average exercise price of $1,883 and a weighted average remaining contractual term of 4.0 years. At December 31, 2006, there were 43,716 nonvested options with an average exercise price of $1,837. The fair value of Kaplan stock options at December 30, 2007 and December 31, 2006 was estimated using...

  • Page 86
    ...Weighted average shares outstanding - basic ...Effect of dilutive shares: Stock options and restricted stock ...Weighted average shares outstanding - diluted . . Basic earnings per common share: Before cumulative effect of change in accounting principle ...Cumulative effect of change in accounting...

  • Page 87
    ... are $459.1 million and $445.9 million of Berkshire Hathaway Class A and Class B common stock at December 30, 2007 and December 31, 2006, respectively. None of the assets is managed internally by the Company. The goal of the investment managers is to try to produce moderate long-term growth in the...

  • Page 88
    ...assets, the Company considers the relative weighting of plan assets, the historical performance of total plan assets and individual asset classes and economic and other indicators of future performance. In addition, the Company may consult with and consider the input 72 THE WASHINGTON POST COMPANY

  • Page 89
    ... trend rate used in measuring the postretirement benefit obligation at December 30, 2007 was 9.5% for both pre-age 65 and post-age 65 benefits, decreasing to 5.0% in the year 2018 and thereafter. Assumed healthcare cost trend rates have a significant effect on the amounts reported for the healthcare...

  • Page 90
    ... schools. Management does not believe that any litigation pending against the Company will have a material adverse effect on its business or financial condition. The Company's education division derives a portion of its net revenues from financial aid received by its students under Title IV programs...

  • Page 91
    ... Post's Springfield, VA, plant. In January and February 2008, the Company purchased approximately $60 million in the common stock of Corinthian Colleges, Inc. O. BUSINESS SEGMENTS Through its subsidiary Kaplan, Inc., the Company provides educational services for individuals, schools and businesses...

  • Page 92
    ..., pay television, cable modem, telephony and other services to subscribers in midwestern, western and southern states. The principal source of revenue is monthly subscription fees charged for services. In 2007, other businesses and corporate office includes the expenses associated with the Company...

  • Page 93
    (This page intentionally left blank) 2007 FORM 10-K 77

  • Page 94
    (In thousands) Education Newspaper Television Magazine Publishing Broadcasting Publishing Cable Television Other Businesses and Intersegment Corporate Office Elimination Consolidated 2007 Operating revenues ...Income (loss) from operations Equity in earnings of affiliates Interest expense, net ...

  • Page 95
    ... Higher Education Test Prep Corporate Overhead Intersegment and Other Elimination Total Education (In thousands) Professional 2007 Operating revenues ...Income (loss) from operations ...Identifiable assets ...Depreciation of property, plant and equipment Amortization expense ...Kaplan stock-based...

  • Page 96
    ... Quarter Third Quarter Fourth Quarter 2007 Quarterly Operating Results Operating revenues Education ...Advertising...Circulation and subscriber ...Other ...Operating costs and expenses Operating ...Selling, general and administrative ...Depreciation of property, plant and equipment Amortization of...

  • Page 97
    ... Fourth Quarter 2006 Quarterly Operating Results Operating revenues Education ...Advertising ...Circulation and subscriber ...Other...Operating costs and expenses Operating...Selling, general and administrative ...Depreciation of property, plant and equipment ...Amortization of intangibles and...

  • Page 98
    ... connection with Kaplan's restructuring of the Score! business ...Charge of $3.6 million related to write-off of an integrated software product under development and severance costs at Kaplan Professional (U.S.) ...Gain of $5.9 million from the sale of property at the company's television station in...

  • Page 99
    ... II THE WASHINGTON POST COMPANY SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS Column A Column B Column C Additions - Charged to Costs and Expenses Column D Column E Description Balance at Beginning of Period Deductions Balance at End of Period Year Ended January 1, 2006 Allowance for doubtful...

  • Page 100
    ... of marketable equity securities 2005 • charges and lost revenue of $17.3 million ($1.80 per share) associated with Hurricane Katrina and other hurricanes • gain of $11.2 million ($1.16 per share) from sales of non-operating land and marketable equity securities 84 THE WASHINGTON POST COMPANY

  • Page 101
    ...) 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 stock...

  • Page 102
    (This page intentionally left blank) 86 THE WASHINGTON POST COMPANY

  • Page 103
    ... on May 11, 2006, and further amended effective January 18, 2007.* 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 September 28, 2003).* The...

  • Page 104
    ...com Kaplan Kids & Schools Kaplan Test Prep and Admissions Kaplan Higher Education Kaplan Professional Newspaper Publishing The Washington Post washingtonpost.com WashPost.com The Washington Post National Weekly Edition NationalWeekly.com The Washington Post Writers Group PostWritersGroup.com Express...

  • Page 105
    ... part of this annual report to shareholders. All of the company's SEC filings are accessible from the company's website, www.washpostco.com. ANNUAL MEETING The annual meeting of stockholders will be held on May 8, 2008, at 8 a.m., at The Washington Post Company, 1150 15th Street, NW, Washington, DC...

  • Page 106
    The Washington Post Company • 1150 15th Street, NW, Washington, DC 20071 • (202) 334-6000 • washpostco.com