News Releases


Wednesday, March 15, 2006

Media General Reports February Revenues, Provides First-Quarter Earnings Guidance

RICHMOND, Va. – Media General, Inc. (NYSE: MEG) today reported February 2006 total revenues of $71.9 million, a 4.2 percent increase compared with February 2005. By business segment, Publishing Division revenues increased 0.8 percent, Broadcast Division revenues increased 9.8 percent, and Interactive Media Division revenues rose 36 percent.

“Bolstered by $3.9 million in advertising revenues from the Winter Olympics on our five NBC affiliates, television gross time sales grew 14.7 percent. Our Olympics revenues this year were 15.3 percent higher than the amount we realized during the 2002 Winter Olympics. We attribute this increase to aggressive sales efforts by our stations to market Olympics advertising packages across several dayparts,” said Marshall N. Morton, president and chief executive officer.

“In the Publishing Division, advertising revenues increased 1.7 percent compared with last February when revenue growth was the strongest of any month in 2005, especially for National advertising,” said Morton. “Advertising growth in February 2006 was driven primarily by the Classified real estate category.

“Our Internet audience and revenues continue to grow by strong double-digit rates. Unique visitors for the month increased nearly 20 percent and represented approximately 4.5 million people coming to our Web sites for news, information and advertising content. Our 36 percent increase in online revenues was driven by Classified advertising, including higher volumes and rates, and all Internet advertising categories finished ahead of last year,” Morton said.

Total Classified revenues for the month increased 10.5 percent, including a 9.3 percent increase in newspaper Classified advertising and a 31.1 percent increase in Classified advertising on the company’s Web sites.

Newspaper Classified advertising revenues increased 19.8 percent at The Tampa Tribune and 4.2 percent at the Richmond Times-Dispatch, while the Winston-Salem Journal had a 5.6 percent decrease. The company’s Community newspapers were up 3.3 percent in the aggregate for Classified advertising.

Employment linage at the company’s three metro newspapers increased a total of 1.7 percent. All three metros yielded a higher average rate in February this year. At the Richmond Times-Dispatch, linage increased 0.7 percent and revenues were up 7 percent. At The Tampa Tribune, linage declined 6.2 percent, while revenues increased 4 percent. At the Winston-Salem Journal, employment linage increased 24 percent, while revenues declined 6.7 percent as a result of lower national employment advertising, which carries a higher average rate.

Real estate linage increased 46 percent for the three markets combined, led by a 95.4 percent increase at The Tampa Tribune. The Richmond Times-Dispatch had 21.4 percent growth, and the Winston-Salem Journal was up 2.7 percent.

Continuing the trend of the last several months, automotive linage was down 14.7 percent in total for the three metros and reflected ongoing spending restraint by automotive dealers.

Retail revenues for February decreased $110,000 or 0.6 percent. The Tampa Tribune had a 4.5 percent decline as a result of lower department store and entertainment advertising. The Richmond Times-Dispatch had a 1.9 percent decrease, due to lower department, furniture and grocery store advertising. Partially offsetting these declines, the Winston-Salem Journal’s Retail revenues increased 4.5 percent, which was attributable to new advertisers, enhancing its weekly television publication and revenues derived from a local health exposition. The Community newspapers had a 1.5 percent decrease in total Retail revenues, while the company’s newspapers in Charlottesville and Northern Virginia continued to post high single-digit increases in Retail advertising.

National revenues for the month decreased $830,000, or 21.9 percent, compared with a higher-than-normal level in February 2005 from issue advertising related to Social Security reform. Declines were reported by all three of the company’s metro newspapers, due to lower spending in the medical, telecommunications and automotive categories. The Tampa Tribune, the Richmond Times-Dispatch and the Winston-Salem Journal reported declines of 22.1 percent, 17 percent and 21.7 percent, respectively.

Circulation revenues for the month decreased $320,000, or 4.7 percent, half of which was due to the continued roll-out of a change in wholesale rates to independent carriers at several newspapers. These rate changes also result in a dollar-for-dollar decrease in Circulation expense. Seven Media General newspapers posted increases in net paid daily Circulation for the month, while overall net paid circulation decreased slightly year-over-year. The rate change roll-out is expected to be completed at all of the company's newspapers by mid-2006.

In the Broadcast Division, gross time sales of $24.8 million increased $3.2 million, or 14.7 percent. Local time sales grew $1.5 million, or 10.1 percent, driven mostly by the Winter Olympics. Categories showing the largest gains were automotive, grocery store and home improvement.

National time sales increased $1.6 million, or 23.3 percent, and also reflected strong advertising from the Winter Olympics as well as higher spending in the services, telecommunications and automotive categories.

Political advertising revenues for the month were $140,000, mostly derived from issue advertising.

Interactive Media Division revenues were $2 million, a 36 percent increase compared to the same month last year. National advertising more than doubled, and Local advertising grew 9 percent. Page views and visitor sessions for the month both increased approximately 20 percent.

For the first quarter of 2006, Media General expects Publishing Division revenue growth will be 3 to 3.5 percent over last year’s first quarter, which is somewhat softer than previously expected. Broadcast time sales for the quarter are expected to increase 7 to 8 percent, in line with previous expectations. Media General began expensing stock options at the beginning of fiscal 2006, which was required by a new accounting rule. First-quarter non-cash option expense will reduce earnings by $1.5 million pretax (4 cents per diluted share). Per the company’s previous guidance, expense growth for newsprint and employee benefits is expected to continue in 2006, and the company is investing in the ramp-up of new business development initiatives. Equity income from SP Newsprint in the first quarter is expected to be below the first quarter of 2005, due to higher energy costs partially offsetting increases in newsprint pricing. Media General expects first-quarter earnings per share to be in the range of 27 cents to 30 cents.

Forward-Looking Statements
This news release contains forward-looking statements that are subject to various risks and uncertainties and should be understood in the context of the company’s publicly available reports filed with the Securities and Exchange Commission. Media General’s future performance could differ materially from its current expectations.

About Media General
Media General is a diversified communications company operating leading newspapers, television stations and online enterprises, primarily in the Southeastern United States. The company’s publishing assets include three metropolitan newspapers, The Tampa Tribune, Richmond Times-Dispatch, and Winston-Salem Journal; 22 daily community newspapers in Virginia, North Carolina, Florida, Alabama and South Carolina; and more than 100 weekly newspapers and other publications. The company’s broadcasting assets include 26 network-affiliated television stations that reach 30 percent of the television households in the Southeast and nearly 8 percent of those in the United States. The company’s interactive media assets include more than 75 online enterprises that are associated with its newspapers and television stations. Media General also owns a 33 percent interest in SP Newsprint Company, a manufacturer of recycled newsprint.

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Investor Contact:
Lou Anne Nabhan
(804) 649-6103

Media Contact:
Ray Kozakewicz
(804) 649-6748