Media General Presents at Credit Suisse First Boston Global Media Conference

Media General Presents at Credit Suisse First Boston Global Media Conference

RICHMOND, Va., Dec. 6 /PRNewswire-FirstCall/ -- Media General, Inc. (NYSE:MEG) today updated investors on the company's strategy, business conditions, and outlook for 2005 and 2006 at the Credit Suisse First Boston Global Media Conference in New York.

Marshall N. Morton, president and chief executive officer, said, "Media General has achieved strong results in a number of key areas in 2005. Through October, the company's Publishing, Broadcast and Interactive Media divisions are all on track to deliver another year of industry outperformance for revenue growth. We are generating organic growth, continually improving our core products and upgrading our sales capabilities, and introducing new products and services. Media General's growth also reflects the value of its Southeastern focus and the strength of markets where it operates," said Morton.

"Media General's strategy is growth. Our properties have proven that we understand our customers. We recognize that our success resides in being a consequential force in our varied market places," he said. "For 2006, the company wants to maintain or increase revenue share at each of its properties, continue to exceed the peer group averages in revenue growth at the division level, and derive at least 5 percent of total revenues, profitably, every year, from new products and services."

Morton said Media General is committed to making strategic acquisitions, including both newspaper and broadcast properties, and that the company would like to expand the number of communities where it can implement its successful multimedia strategy. "We'll continue to stress that consumers in markets of all sizes should be allowed to benefit from the better local news and content that already has been shown to flow from the common ownership of television stations and newspapers.

"Media General has proven that we can deliver industry-leading revenue growth. Our solid balance sheet, strong cash flow generating businesses, efficient operations, and agility in allocating resources provide us with the wherewithal to support our businesses and invest in growth strategies that will continue to build shareholder value," he said.

Reid Ashe, executive vice president and chief operating officer, reported on the company's year-to-date operating performance. He also noted that, "During the multiple hurricanes this year, our operations had the opportunity to show what makes Media General an extraordinary company. With our regional focus and standardized systems, we can move people and equipment around as necessary. Our stations served our communities in ways that no competitor could match."

Media General provided the following outlook for the fourth quarter of 2005 and the full-year 2006:

Fourth-Quarter 2005 Outlook

For the fourth quarter of 2005, Media General expects Publishing revenue growth to improve slightly over the third quarter, with strong Retail advertising offset by weaker National advertising and slightly softer Classified advertising. Broadcast Local and National time sales combined are expected to run 15 percent above last year, excluding Political revenues. The company does not expect to offset fully the $20.5 million in Political revenues it enjoyed in last year's fourth quarter.

John A. Schauss, vice president-finance and chief financial officer, said, "For the fourth quarter of 2005, we have just completed the closing on our month of November. It will be later this week before we have an updated view of Media General's fourth-quarter outlook. We also still need to refine our expectations regarding the impact of energy prices for the rest of this year, and we do not have SP Newsprint's outlook for December. We can tell you today that we do not expect to be at either the low end or the high end of the current range of analyst estimates of 93 cents to $1.18 per share. We hope to provide more definitive fourth-quarter guidance next week when we announce our November revenues."

Full-Year 2006 Outlook

The company's full-year 2006 will have 53 weeks. The extra week will occur the last week of December, which is typically strong in preprints and post-holiday advertising, while employment and real estate classifieds tend to be softer.

In 2006, Media General expects to surpass $1 billion in total revenues for the first time, driven by the return of Political and Olympics revenue in the Broadcast Division, solid advertising growth in the Publishing Division, and continued strong double-digit growth in online revenues.

The company provided the following assumptions for full-year 2006:

Publishing Division % increase
Classified revenues 7.5-8
Retail revenues 7.5-8
National revenues 6-7
Advertising revenues 7-8
Total revenues 6-7
Total expenses 7-8
Segment operating profit 2-3

Broadcast Division % increase
Local time sales 6-7
National time sales 2-3
Time sales 12-13
Total revenues 11-12
Total expenses 8-9
Segment operating profit 23-24

For 2006, Media General has forecast approximately $30 million in Political revenues and $3.5 million from the Olympics. The company does not expect an increase over the $32 million generated in Political revenues in 2002 since fewer intense races are expected.

Interactive Media Division $ in millions
Revenues 30

Media General expects the Interactive Media Division to be cash flow positive in 2006.

The company's revenue assumptions for the 53rd week include Publishing revenue of $10 million, Broadcast revenue of $5.5 million and Interactive Media revenue of about $400,000.

Equity income from SP Newsprint is projected to increase as much as $5.5 million over 2005 as a result of higher newsprint prices. Interest expense will increase as a result of higher interest rates. Corporate expense is projected to increase as a result of higher costs for benefits and information technology. Media General plans to implement the accounting change that requires the expensing of stock options on January 1, and the pre-tax impact for 2006 is expected to be non-cash expense of $6 million.

For the full year of 2006, Media General expects a healthy increase in operating profit over 2005, reflecting the benefit of investments in growth. However, mostly because of the absence of this year's $19 million gain on the sale of its interest in The Denver Post, net income in 2006 is projected to be lower than 2005.

Capital spending in 2006 is expected to be $115 million, compared to the estimated 2005 plan of $82 million. The increase is due primarily to approved projects that were deferred from 2005. Publishing plans to spend $63 million, mostly to complete three press projects and a new integrated advertising system. Broadcast plans to spend $46 million, including investments to complete the transition to the full-power high definition standard, and a new facility in Myrtle Beach, S.C. Interactive Media will spend about $2 million and corporate expenditures are budgeted at $4 million.

The company said debt at the end of November was $478 million.

Following today's presentation, a full text and slides from the presentation will be available in the Investor Relations section of Media General's Web site, http://www.mediageneral.com/. An audio replay will be available on Wednesday, December 7, 2005, at approximately 2 p.m. ET and will remain available for 90 days. Click on the link on the Media General Home Page.

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 more than 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 50 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.

Source: Media General, Inc.

CONTACT: Media: Ray Kozakewicz, +1-804-649-6748, or Investors: Lou Anne
Nabhan, +1-804-649-6103, both of Media General, Inc.

Web site: http://www.mediageneral.com/

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