Meredith Reports Fiscal 2008 and Fourth Quarter Earnings

Meredith Reports Fiscal 2008 and Fourth Quarter Earnings

DES MOINES, Iowa, July 30 /PRNewswire-FirstCall/ -- Meredith Corporation (NYSE:MDP), the leading media and marketing company serving American women, today reported fiscal 2008 earnings per share of $2.83, including a special charge of $0.34. Excluding the special charge, Meredith's earnings per share were $3.17, in-line with prior company estimates. Fiscal 2007 earnings per share were $3.31. Revenues in fiscal 2008 and fiscal 2007 were $1.6 billion.

Fourth quarter fiscal 2008 earnings per share were $0.41. Excluding the special charge, earnings per share were $0.76. Fiscal 2007 fourth-quarter earnings per share were $1.05. Fiscal 2008 fourth-quarter revenues were $385 million, compared to $428 million in the prior-year quarter.

Meredith recorded an after-tax special charge of $16 million in the fourth fiscal quarter, related primarily to the further repositioning of its book publishing business and selected reductions in force. Additional information on the special charge is available in Tables 1 and 2, and in Meredith's press release dated June 5, 2008.

After strong performance in the first half of fiscal 2008, the economic slowdown impacted Meredith's full-year performance, most notably in the fourth quarter. Meredith experienced lower advertising demand; a soft retail marketplace resulting in weaker sales and higher-than-expected returns in its book operation; and higher input costs, particularly for paper.

"We believe current economic trends are cyclical in nature and not structural as they pertain to our industry or Meredith in particular," said Stephen M. Lacy, Meredith's President and CEO, citing recently released data detailing audience measurement gains for the magazine and television industries. "We possess great brands, sound growth strategies, strong management and a committed and talented workforce. I'm confident we will emerge from this cycle in an even stronger and more competitive position."

Meredith is executing a three-pronged performance improvement plan to address the current environment. Meredith's strategies include:

1. Special sales incentives and new marketing programs to maximize market
share in its core publishing and broadcasting businesses;
2. Aggressive expense management, including tight control of labor and
vendor costs; and
3. Revenue diversification initiatives to accelerate growth of new revenue
streams, many of which are not dependent on traditional advertising.
For example, in fiscal 2008 Meredith:
- Acquired two leading-edge companies -- Big Communications and
Directive -- that further expand the capabilities of Meredith
Integrated Marketing. Big Communications is a leader in business-
to-business healthcare marketing. Directive possesses expertise in
the sought-after field of database marketing.
- Expanded its brand licensing activities through an agreement with
Wal-Mart for a line of more than 500 home products that will be
available in Wal-Mart stores across the country beginning this fall.
Meredith also entered into a licensing agreement with Realogy for a
nationwide real estate franchise system that launched this month,
and expanded its successful licensing agreement with Universal
Furniture. All three programs leverage the tremendous power and
versatility of the Better Homes and Gardens brand.
- Invested in new tools and platforms across its 40+ Web sites,
including the launch of the Parents.com super-portal.
- Broadened the reach of Meredith Video Solutions -- its in-house
video creation unit -- by distributing the Better daily lifestyle
television show. Meredith also created a Parents-branded video on
demand channel for Comcast and launched Parents.tv, a broadband
video channel.
- Renegotiated several retransmission agreements for Meredith
television stations, increasing fees 50 percent over the prior year.

Additionally, Meredith returned capital to shareholders in fiscal 2008 by repurchasing 3.2 million shares, nearly triple the amount repurchased in fiscal 2007. Meredith also increased its quarterly dividend rate by 16 percent -- its 15th consecutive annual dividend increase.

OPERATING DETAIL

Publishing

Fiscal 2008 Publishing operating profit was $190 million. Excluding the special charge, operating profit was $215 million. Fiscal 2007 operating profit was $216 million. Total revenues were $1.3 billion and advertising revenues were $641 million, both comparable with the prior fiscal year.

Fourth quarter operating profit was $26 million. Excluding the special charge, operating profit was $50 million. Fiscal 2007 operating profit was $70 million. Total revenues were $306 million and advertising revenues were $153 million, compared to $345 million and $178 million, respectively, in fiscal 2007.

While overall fiscal 2008 Publishing advertising performance was comparable to the prior fiscal year, there was a marked contrast between the first half, when Meredith posted strong 11 percent growth, and weaker results in the second half, particularly in the fourth quarter.

This shift was attributed to the challenging economic environment faced by companies that operate in Meredith's largest advertising categories - food, prescription and non-prescription drugs, and home. Combined, advertising pages in these categories declined more than 20 percent, accounting for about 75 percent of total fourth-quarter advertising page declines.

"These categories are staples of the American economy, and have consistently outpaced advertising industry growth rates," Lacy said, noting the 15 percent overall gain for Meredith in the food category in fiscal 2008. "We're confident they will serve us well in the long-term. In addition, we increased net advertising revenue per page in fiscal 2008, due to a very detailed and aggressive pricing strategy."

Meredith's growing consumer connection was confirmed in the Spring 2008 Mediamark Research and Intelligence report, which is heavily used by advertisers. Meredith titles increased their total audience by more than 4 percent. And eight of the 10 Meredith magazines measured gained total audience, including Better Homes and Gardens, Ladies' Home Journal and Parents.

Meredith's circulation profit contribution and related margin in its subscription activities increased in both fiscal 2008 and the fourth quarter, reflecting the strength of Meredith's consumer appeal. Circulation revenues declined, as expected, due primarily to the ongoing transition of Parents, Family Circle and Fitness magazines away from third-party sources to Meredith's more profitable direct-to-publisher model.

Meredith Integrated Marketing delivered another outstanding year as operating profit rose almost 75 percent to $30 million and revenues rose nearly 50 percent to $156 million. Results included increased contributions from three acquisitions in the last two years: Genex, New Media Strategies and Directive. On a comparable basis, Meredith Integrated Marketing revenues rose 25 percent and operating profit rose 30 percent, due to continued growth in custom publishing activities and strong performance from online agency O'Grady Myers, acquired in April 2006.

Publishing's retail book operations experienced softer retail sales and higher-than-expected returns during fiscal 2008. Meredith has taken a number of actions to reposition its book operations, including focusing on titles with the Better Homes and Gardens imprint and certain other licensed brands. These steps are expected to improve financial performance going forward.

Broadcasting

Fiscal 2008 Broadcasting operating profit was $78 million. Excluding the special charge, operating profit was $79 million. Fiscal 2007 operating profit was $107 million, which included $33 million in net political advertising revenues. EBITDA was $105 million, compared to $131 million in fiscal 2007. Revenues were $319 million, compared to $348 million in fiscal 2007.

For the fourth quarter, operating profit was $18 million. Excluding the special charge, operating profit was $19 million. Fiscal 2007 operating profit was $28 million. EBITDA was $26 million, compared to $34 million in fiscal 2007. Revenues were $79 million, compared to $84 million in fiscal 2007.

In the first half of the fiscal year, non-political advertising revenues increased 4 percent, driven by growth in online advertising and the categories of professional services and telecommunications. In the second half, a decline in automotive advertising, along with weaker performance in retail and movies, led to a decline in non-political advertising revenues.

"In fiscal 2008 we increased our emphasis on developing non-traditional sources of revenues such as unique sales initiatives, our station Web sites, retransmission fees and our video creation business," Lacy said.

For example, Broadcasting online and video-related revenues increased more than 80 percent in fiscal 2008. Average unique visitors increased more than 300 percent and page views doubled. More than 1.3 million videos were streamed each month during the year.

Meredith Video Solutions is growing rapidly. The Better show, which features content inspired by Meredith's publishing brands, will be carried in more than 35 markets beginning this fall. Additionally, Comcast video on demand customers downloaded more than 600,000 Parents TV videos in fiscal 2008.

OTHER FINANCIAL INFORMATION

Meredith generated more than $150 million in free cash flow during fiscal 2008, including nearly $20 million in the fourth quarter. Meredith repurchased approximately 3.2 million shares in fiscal 2008, nearly triple the 1.1 million shares repurchased in fiscal 2007. Meredith has 2.7 million shares remaining under current share repurchase authorizations.

Meredith increased its quarterly dividend rate 16 percent to 21-1/2 cents per share in January. Meredith has paid a dividend for 61 consecutive years and has increased its dividend for 15 consecutive years.

Despite significant increases in paper and postage costs and the special charge, Meredith limited its increase in expenses to just 1 percent in fiscal 2008, reflecting disciplined expense management. Unallocated corporate expenses decreased during the year, primarily due to lower employee benefit costs and management incentives accruals.

Total debt was $485 million and the weighted average interest rate was approximately 4.7 percent as of June 30, 2008. Meredith's debt-to-EBITDA ratio is a conservative 1.5-to-1.

All earnings per share figures in the text of this release are diluted. Both basic and diluted earnings per share can be found in the attached consolidated statements of earnings.

OUTLOOK

Many of Meredith's largest advertisers continue to face a challenging economic environment and the resulting advertising weakness -- along with increased paper costs -- will impact the company's performance at least through the first half of fiscal 2009.

Currently, fiscal 2009 first-quarter Publishing advertising revenues are down in the high-teens compared to the first quarter of fiscal 2008, when Meredith posted 11 percent growth in Publishing advertising revenues. Broadcasting advertising pacings are currently down in the mid-teens. Meredith expects approximately $20 to $25 million in political advertising revenues at its television stations in fiscal 2009, with the majority coming in the second fiscal quarter.

Meredith expects fiscal 2009 paper prices will average approximately 25 percent higher than fiscal 2008. Meredith expects its average tax rate will be approximately 43.5 percent in the first quarter, and 39.5 percent for full fiscal 2009.

Currently, Meredith expects full-year fiscal 2009 earnings per share to be in the $2.50 to $3.00 range, and first quarter earnings per share to be in the $0.40 to $0.45 range.

A number of uncertainties remain that may affect Meredith's outlook as stated in this press release for fiscal 2009 and the first quarter. These include overall advertising volatility; the amount of political advertising revenues generated at its broadcast television stations, particularly in the first and second quarters; the performance of Meredith's retail businesses; and paper prices and postal rates. These and other uncertainties are referenced below under "Safe Harbor" and in certain SEC filings.

CONFERENCE CALL WEBCAST

Meredith will host a conference call on July 30, 2008, at 11 a.m. EDT (10 a.m. CDT) to discuss fiscal 2008 results. A live webcast will be accessible to the public on http://www.meredith.com/, and a replay will be available for one week after the call. A transcript will be available within 48 hours following the call on http://www.meredith.com/.

RATIONALE FOR USE AND ACCESS TO NON-GAAP MEASURES

Management uses and presents GAAP and non-GAAP results to evaluate and communicate Meredith's performance. Non-GAAP measures should not be construed as alternatives to GAAP measures. EBITDA and free cash flow are common supplemental measures of performance used by investors and financial analysts. Management believes that EBITDA and free cash flow provide additional analytical tools to clarify Meredith's results from core operations and delineate underlying trends. Meredith does not use EBITDA or free cash flow as a measure of liquidity or funds available for management's discretionary use as they include certain contractual and non-discretionary expenditures.

Results excluding the special charge recorded in the fourth quarter of fiscal 2008 are also supplemental non-GAAP financial measures. Management believes the special charge is not reflective of Meredith's ongoing business activities. While results excluding the special charge are not a substitute for reported earnings results under GAAP, management believes this information is useful as an aid in better understanding Meredith's current performance, performance trends and financial condition. Reconciliations of non-GAAP to GAAP measures are included in the attached tables. The attached consolidated financial statements and reconciliation tables will be made available at http://www.meredith.com/.

SAFE HARBOR

This release contains certain forward-looking statements that are subject to risks and uncertainties. These statements are based on management's current knowledge and estimates of factors affecting Meredith's operations. Statements in this announcement that are forward-looking include, but are not limited to, the statements regarding broadcasting pacings and publishing advertising revenues, along with Meredith's earnings per share outlook. Actual results may differ materially from those currently anticipated. Factors that could adversely affect future results include, but are not limited to, downturns in national and/or local economies; a softening of the domestic advertising market; world, national or local events that could disrupt broadcast television; increased consolidation among major advertisers or other events depressing the level of advertising spending; the unexpected loss or insolvency of one or more major clients; the integration of acquired businesses; changes in consumer reading, purchasing and/or television viewing patterns; increases in paper, postage, printing or syndicated programming costs; changes in television network affiliation agreements; technological developments affecting products or methods of distribution; changes in government regulations affecting Meredith's industries; unexpected changes in interest rates; and the consequences of acquisitions and/or dispositions. Meredith undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.

ABOUT MEREDITH CORPORATION

Meredith Corporation (NYSE:MDP:)(NYSE:http://www.meredith.com) is the leading media and marketing company serving American women. Meredith combines well- known national brands -- including Better Homes and Gardens, Parents, Ladies' Home Journal, Family Circle, American Baby, Fitness and More -- with local television brands in fast growing markets. Meredith is the industry leader in creating content in key consumer interest areas such as home, family, health and wellness and self-development. Meredith then uses multiple distribution platforms -- including print, television, online, mobile and video -- to give consumers content they desire and to deliver the messages of its marketing partners. Additionally, Meredith uses its many assets to create powerful custom marketing solutions for many of the nation's top brands and companies. The goals of these programs are to increase consumer loyalty and produce repeated consumer interaction. In the last two years, Meredith has significantly added to its capabilities in this area through the acquisition of cutting-edge companies in areas such as online, word-of-mouth and database marketing. Meredith employs approximately 3,500 people throughout the United States. Meredith's 2008 annual revenues were $1.6 billion.

Shareholder/Financial Analyst Contact: Media Contact:
Mike Lovell Art Slusark
Director of Investor Relations VP/Corporate Communications
Phone: (515) 284.3622 Phone: (515) 284.3404
E-mail: Mike.Lovell@Meredith.com E-mail: Art.Slusark@Meredith.com

Meredith Corporation and Subsidiaries
Consolidated Statements of Earnings (Unaudited)

Three Months Twelve Months
Period Ended June 30, 2008 2007 2008 2007
(In thousands except per share
data)
Revenues
Advertising $227,522 $259,260 $951,325 $981,953
Circulation 73,299 81,707 313,616 335,706
All other 84,372 87,503 321,590 298,326
Total revenues 385,193 428,470 1,586,531 1,615,985
Operating expenses
Production, distribution, and
editorial 176,601 170,555 688,868 663,345
Selling, general, and
administrative 157,993 159,001 606,987 619,361
Depreciation and amortization 13,172 11,681 49,171 45,030
Total operating expenses 347,766 341,237 1,345,026 1,327,736
Income from operations 37,427 87,233 241,505 288,249
Interest income 192 414 1,090 1,586
Interest expense (5,106) (5,849) (22,390) (27,182)
Earnings from continuing
operations before income taxes 32,513 81,798 220,205 262,653
Income taxes 13,505 32,148 86,100 93,823
Earnings from continuing
operations 19,008 49,650 134,105 168,830
Income (loss) from discontinued
operations, net of taxes 151 1,864 567 (6,484)
Net earnings $19,159 $51,514 $134,672 $162,346

Basic earnings per share
Earnings from continuing
operations $0.42 $1.03 $2.86 $3.51
Discontinued operations - 0.04 0.01 (0.13)
Basic earnings per share $0.42 $1.07 $2.87 $3.38
Basic average shares outstanding 45,957 48,120 46,928 48,048

Diluted earnings per share
Earnings from continuing
operations $0.41 $1.01 $2.82 $3.44
Discontinued operations - 0.04 0.01 (0.13)
Diluted earnings per share $0.41 $1.05 $2.83 $3.31
Diluted average shares
outstanding 46,177 49,259 47,585 49,108

Dividends paid per share $0.215 $0.185 $0.800 $0.690

Meredith Corporation and Subsidiaries
Segment Information (Unaudited)

Three Months Twelve Months
Period Ended June 30, 2008 2007 2008 2007
(In thousands)
Revenues
Publishing $306,322 $344,718 $1,267,926 $1,268,153
Broadcasting
Non-political advertising 73,246 81,230 304,922 309,350
Political advertising 1,507 292 5,447 33,216
Other revenues 4,118 2,230 8,236 5,266
Total broadcasting 78,871 83,752 318,605 347,832
Total revenues $385,193 $428,470 $1,586,531 $1,615,985

Operating profit
Publishing $25,557 $69,724 $190,194 $216,356
Broadcasting 18,030 27,762 77,860 106,804
Unallocated corporate (6,160) (10,253) (26,549) (34,911)
Income from operations $37,427 $87,233 $241,505 $288,249

Depreciation and amortization
Publishing $4,794 $4,845 $20,391 $18,714
Broadcasting 7,686 6,153 26,655 24,171
Unallocated corporate 692 683 2,125 2,145
Total depreciation and
amortization $13,172 $11,681 $49,171 $45,030

EBITDA(1)
Publishing $30,351 $74,569 $210,585 $235,070
Broadcasting 25,716 33,915 104,515 130,975
Unallocated corporate (5,468) (9,570) (24,424) (32,766)
Total EBITDA(1) $50,599 $98,914 $290,676 $333,279

(1) EBITDA is earnings from continuing operations before interest, taxes,
depreciation, and amortization.

Meredith Corporation and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)

June 30, June 30,
Assets 2008 2007
(In thousands)
Current assets
Cash and cash equivalents $37,644 $39,220
Accounts receivable, net 230,978 267,419
Inventories 44,085 48,836
Current portion of subscription acquisition
costs 59,939 70,553
Current portion of broadcast rights 10,779 11,307
Other current assets 19,665 15,305
Total current assets 403,090 452,640
Property, plant, and equipment 446,935 445,846
Less accumulated depreciation (247,147) (239,820)
Net property, plant, and equipment 199,788 206,026
Subscription acquisition costs 60,958 66,309
Broadcast rights 7,826 9,309
Other assets 74,472 101,178
Intangibles assets, net 781,154 794,996
Goodwill 532,332 459,493
Total assets $2,059,620 $2,089,951

Liabilities and Shareholders' Equity
Current liabilities
Current portion of long-term debt $75,000 $100,000
Current portion of long-term broadcast rights
payable 11,141 12,069
Accounts payable 79,028 78,156
Accrued expenses and other liabilities 124,600 105,359
Current portion of unearned subscription
revenues 175,261 191,445
Total current liabilities 465,030 487,029
Long-term debt 410,000 375,000
Long-term broadcast rights payable 17,186 18,584
Unearned subscription revenues 157,872 167,873
Deferred income taxes 139,598 166,597
Other noncurrent liabilities 82,079 41,667
Total liabilities 1,271,765 1,256,750
Shareholders' equity
Common stock 36,295 38,970
Class B stock 9,181 9,262
Additional paid-in capital 52,693 54,842
Retained earnings 701,205 727,628
Accumulated other comprehensive income (loss) (11,519) 2,499
Total shareholders' equity 787,855 833,201
Total liabilities and shareholders' equity $2,059,620 $2,089,951

Meredith Corporation and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)

Twelve Months Ended June 30, 2008 2007
(In thousands)
Net cash provided by operating activities $255,964 $210,522

Cash flows from investing activities
Acquisitions of businesses (73,645) (30,303)
Additions to property, plant, and equipment (29,620) (42,599)
Proceeds from disposition of assets 7,855 7,658
Net cash used in investing activities (95,410) (65,244)

Cash flows from financing activities
Proceeds from issuance of long-term debt 335,000 190,000
Repayments of long-term debt (325,000) (280,000)
Purchases of Company stock (150,377) (58,710)
Proceeds from common stock issued 14,265 41,673
Dividends paid (37,344) (33,248)
Excess tax benefits from share-based
payments 1,475 3,514
Other (149) -
Net cash used in financing activities (162,130) (136,771)
Net increase (decrease) in cash and cash
equivalents (1,576) 8,507
Cash and cash equivalents at beginning of
year 39,220 30,713
Cash and cash equivalents at end of year $37,644 $39,220

Meredith Corporation and Subsidiaries Table 1
Supplemental Disclosures Regarding Non-GAAP Financial Measures

Special Charge - During the fourth quarter of fiscal 2008, Meredith
recorded a special charge which relates primarily to further focusing the
scope of its book operations. The special charge included adjusting
certain book royalties, art and editorial, and inventory accounts, as
well as severance for eliminated positions in book and elsewhere in the
Company. Please see Meredith's press release dated June 5, 2008, for
additional information relating to the special charge.

The following table shows results of operations excluding the special
charge and as reported with the difference being the special charge.
Results of operations excluding the special charge are non-GAAP measures.
Management's rationale for presenting non-GAAP measures is included in
the text of this earnings release.

Period Ended June 30, 2008 Three Months
Excluding
Special Special
Charge Charge As Reported
(In thousands except per share data)
Revenues
Advertising $227,522 $- $227,522
Circulation 73,299 - 73,299
All other 93,051 (8,679)(a) 84,372
Total revenues 393,872 (8,679) 385,193
Operating expenses
Production, distribution, and editorial 172,115 4,486 (b) 176,601
Selling, general, and administrative 144,727 13,266 (c) 157,993
Depreciation and amortization 13,172 - 13,172
Total operating expenses 330,014 17,752 347,766
Income from operations 63,858 (26,431) 37,427
Interest income 192 - 192
Interest expense (5,106) - (5,106)
Earnings from continuing operations
before income taxes 58,944 (26,431) 32,513
Income taxes 23,839 (10,334) 13,505
Earnings from continuing operations 35,105 (16,097) 19,008
Income from discontinued operations,
net of taxes 151 - 151
Net earnings $35,256 $(16,097) $19,159

Basic earnings per share
Earnings from continuing operations $0.77 $(0.35) $0.42
Discontinued operations - - -
Basic earnings per share $0.77 $(0.35) $0.42
Basic average shares outstanding 45,957 45,957 45,957

Diluted earnings per share
Earnings from continuing operations $0.76 $(0.35) $0.41
Discontinued operations - - -
Diluted earnings per share $0.76 $(0.35) $0.41
Diluted average shares outstanding 46,177 46,177 46,177

Period Ended June 30, 2008 Twelve Months
Excluding
Special Special
Charge Charge As Reported
(In thousands except per share data)
Revenues
Advertising $951,325 $- $951,325
Circulation 313,616 - 313,616
All other 330,269 (8,679)(a) 321,590
Total revenues 1,595,210 (8,679) 1,586,531
Operating expenses
Production, distribution, and editorial 684,382 4,486 (b) 688,868
Selling, general, and administrative 593,721 13,266 (c) 606,987
Depreciation and amortization 49,171 - 49,171
Total operating expenses 1,327,274 17,752 1,345,026
Income from operations 267,936 (26,431) 241,505
Interest income 1,090 - 1,090
Interest expense (22,390) - (22,390)
Earnings from continuing operations
before income taxes 246,636 (26,431) 220,205
Income taxes 96,434 (10,334) 86,100
Earnings from continuing operations 150,202 (16,097) 134,105
Income from discontinued operations,
net of taxes 567 - 567
Net earnings $150,769 $(16,097) $134,672

Basic earnings per share
Earnings from continuing operations $3.20 $(0.34) $2.86
Discontinued operations 0.01 - 0.01
Basic earnings per share $3.21 $(0.34) $2.87
Basic average shares outstanding 46,928 46,928 46,928

Diluted earnings per share
Earnings from continuing operations $3.16 $(0.34) $2.82
Discontinued operations 0.01 - 0.01
Diluted earnings per share $3.17 $(0.34) $2.83
Diluted average shares outstanding 47,585 47,585 47,585

Notes
(a) Increase in book sales return allowance
(b) Write-down of book inventory and editorial prepaid expenses
(c) Severance expense, write-down of book royalty, and bad debt reserve
for Home Interiors Group receivable

Meredith Corporation and Subsidiaries Table 2
Segment Information (Unaudited)

The following table shows results of operations excluding the special
charge and as reported with the difference being the special charge.
Results of operations excluding the special charge are non-GAAP
measures. Management's rationale for presenting non-GAAP measures is
included in the text of this earnings release.

Period Ended June 30, 2008 Three Months
Excluding
Special Special
Charge Charge As Reported
(In thousands)
Revenues
Publishing $315,001 $(8,679)(a) $306,322
Broadcasting
Non-political advertising 73,246 - 73,246
Political advertising 1,507 - 1,507
Other revenues 4,118 - 4,118
Total broadcasting 78,871 - 78,871
Total revenues $393,872 $(8,679) $385,193

Operating profit
Publishing $50,424 $(24,867)(b) $25,557
Broadcasting 19,449 (1,419)(c) 18,030
Unallocated corporate (6,015) (145)(d) (6,160)
Income from operations $63,858 $(26,431) $37,427

Depreciation and amortization
Publishing $4,794 $- $4,794
Broadcasting 7,686 - 7,686
Unallocated corporate 692 - 692
Total depreciation and amortization $13,172 $- $13,172

EBITDA(1)
Publishing $55,218 $(24,867)(b) $30,351
Broadcasting 27,135 (1,419)(c) 25,716
Unallocated corporate (5,323) (145)(d) (5,468)
Total EBITDA(1) $77,030 $(26,431) $50,599

Period Ended June 30, 2008 Twelve Months
Excluding
Special Special
Charge Charge As Reported
(In thousands)
Revenues
Publishing $1,276,605 $(8,679)(a) $1,267,926
Broadcasting
Non-political advertising 304,922 - 304,922
Political advertising 5,447 - 5,447
Other revenues 8,236 - 8,236
Total broadcasting 318,605 - 318,605
Total revenues $1,595,210 $(8,679) $1,586,531

Operating profit
Publishing $215,061 $(24,867)(b) $190,194
Broadcasting 79,279 (1,419)(c) 77,860
Unallocated corporate (26,404) (145)(d) (26,549)
Income from operations $267,936 $(26,431) $241,505

Depreciation and amortization
Publishing $20,391 $- $20,391
Broadcasting 26,655 - 26,655
Unallocated corporate 2,125 - 2,125
Total depreciation and amortization $49,171 $- $49,171

EBITDA(1)
Publishing $235,452 $(24,867)(b) $210,585
Broadcasting 105,934 (1,419)(c) 104,515
Unallocated corporate (24,279) (145)(d) (24,424)
Total EBITDA(1) $317,107 $(26,431) $290,676

(1) EBITDA is earnings from continuing operations before interest,
taxes, depreciation, and amortization.

Notes
(a) Increase in book sales return allowance
(b) Increase in book sales return allowance; write-down of book
inventory, book royalty, and editorial prepaid expense; bad debt
reserve for Home Interiors Group receivable, and severance
expense for Publishing operations
(c) Severance expense for Broadcasting operations
(d) Severance expense for Corporate personnel

Meredith Corporation and Subsidiaries Table 3
Supplemental Disclosures Regarding Non-GAAP Financial Measures

EBITDA
Consolidated EBITDA, which is reconciled to earnings from continuing
operations in the following tables, is defined as earnings from continuing
operations before interest, taxes, depreciation, and amortization.

Segment EBITDA is a measure of segment earnings before depreciation and
amortization.

Segment EBITDA margin is defined as segment EBITDA divided by segment
revenues.

Three Months Ended June 30, 2008
Unallocated
Publishing Broadcasting Corporate Total
(In thousands)
Revenues $306,322 $78,871 $- $385,193

Operating profit $25,557 $18,030 $(6,160) $37,427
Depreciation and amortization 4,794 7,686 692 13,172
EBITDA $30,351 $25,716 $(5,468) 50,599
Less:
Depreciation and amortization (13,172)
Net interest expense (4,914)
Income taxes (13,505)
Earnings from continuing operations $19,008

Segment EBITDA margin 9.9% 32.6%

Twelve Months Ended June 30, 2008
Unallocated
Publishing Broadcasting Corporate Total
(In thousands)
Revenues $1,267,926 $318,605 $- $1,586,531

Operating profit $190,194 $77,860 $(26,549) $241,505
Depreciation and amortization 20,391 26,655 2,125 49,171
EBITDA $210,585 $104,515 $(24,424) 290,676
Less:
Depreciation and amortization (49,171)
Net interest expense (21,300)
Income taxes (86,100)
Earnings from continuing
operations $134,105

Segment EBITDA margin 16.6% 32.8%

Three Months Ended June 30, 2007
Unallocated
Publishing Broadcasting Corporate Total
(In thousands)
Revenues $344,718 $83,752 $- $428,470

Operating profit $69,724 $27,762 $(10,253) $87,233
Depreciation and amortization 4,845 6,153 683 11,681
EBITDA $74,569 $33,915 $(9,570) 98,914
Less:
Depreciation and amortization (11,681)
Net interest expense (5,435)
Income taxes (32,148)
Earnings from continuing operations $49,650

Segment EBITDA margin 21.6% 40.5%

Twelve Months Ended June 30, 2007
Unallocated
Publishing Broadcasting Corporate Total
(In thousands)
Revenues $1,268,153 $347,832 $- $1,615,985

Operating profit $216,356 $106,804 $(34,911) $288,249
Depreciation and
amortization 18,714 24,171 2,145 45,030
EBITDA $235,070 $130,975 $(32,766) 333,279
Less:
Depreciation and
amortization (45,030)
Net interest expense (25,596)
Income taxes (93,823)
Earnings from continuing
operations $168,830

Segment EBITDA margin 18.5% 37.7%

Table 4
FREE CASH FLOW
Free cash flow, which is reconciled to earnings from continuing operations
in the following tables, is defined as earnings from continuing operations
plus depreciation and amortization less capital expenditures.

Three Months Twelve Months
Period Ended June 30, 2008 2007 2008 2007
(In thousands)
Free cash flow $17,972 $47,746 $153,656 $171,261
Depreciation and amortization (13,172) (11,681) (49,171) (45,030)
Capital expenditures 14,208 13,585 29,620 42,599
Earnings from continuing operations $19,008 $49,650 $134,105 $168,830

First Call Analyst:
FCMN Contact:

Source: Meredith Corporation

CONTACT: Shareholder|Financial Analyst, Mike Lovell, Director of
Investor Relations, +1-515-284-3622, Mike.Lovell@Meredith.com, or Media, Art
Slusark, VP|Corporate Communications, +1-515-284-3404,
Art.Slusark@Meredith.com, both of Meredith Corporation

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

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