EX-99.1 3 dex991.htm EXHIBIT 99.

1
Exhibit 99.1 UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION On September 30, 2010, The Washington Post Company (the Company) completed the sale of Newsweek magazine to Harman Media, LLC and Dr. Sidney Harman. Under the terms of the asset purchase agreement, the buyer assumed Newsweeks subscription obligations and received Newsweeks intellectual property, target working capital and selected equipment used in the business. The Company retained the pension assets and liabilities and certain employee obligations, including severance, and other liabilities arising prior to the sale. The accompanying unaudited pro forma condensed consolidated balance sheet presents the Companys financial position assuming the sale of Newsweek magazine occurred on July 4, 2010. The accompanying unaudited pro forma condensed consolidated statements of income present the Companys results of operations for each of the three fiscal years in the period ended January 3, 2010 assuming the sale of Newsweek magazine occurred on January 1, 2007. The Company reported the disposition of Newsweek magazine as a discontinued operation in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 205, Presentation of Financial Statements (ASC 205) for the twenty six weeks ended July 4, 2010 and June 28, 2009 in its quarterly report on Form 10-Q for the quarterly period ended July 4, 2010, and therefore the Company did not include the unaudited pro forma condensed consolidated statements of income for these periods in this Current Report on Form 8-K. The unaudited pro forma condensed consolidated financial statements have been prepared using assumptions and estimates that the Company believes are reasonable under the circumstances and are intended for informational purposes only. They are not necessarily indicative of the financial results that would have occurred if the transactions described herein had taken place on the dates indicated, nor are they indicative of the future consolidated results of the Company. However, management believes that the estimates and assumptions used provide a reasonable basis for presenting the significant effects of the sale of Newsweek magazine. Management also believes the pro forma adjustments give appropriate effect to the estimates and assumptions and are applied in conformity with accounting principles generally accepted in the United States of America. The accompanying unaudited pro forma condensed consolidated balance sheet as of July 4, 2010 and the unaudited pro forma condensed consolidated statements of income for each of the three fiscal years in the period ended January 3, 2010 should be read in conjunction with the historical financial statements of the Company for the twenty six weeks ended July 4, 2010 (unaudited) and for each of the three fiscal years in the period ended January 3, 2010 (audited), including the related notes, filed with the Securities and Exchange Commission, respectively, on Form 10-Q on August 11, 2010 and on Form 10-K on March 2, 2010. The following is a brief description of the amounts recorded under each of the column headings in the accompanying unaudited condensed consolidated balance sheet and the unaudited condensed consolidated statements of income: Historical TWPC This column reflects the Companys historical financial position as of July 4, 2010 and historical operating results for each of the three years in the period ended January 3, 2010, prior to any adjustment for the sale of Newsweek magazine. Sale of Newsweek This column reflects Newsweek magazines historical financial position of the assets sold and liabilities assumed as of July 4, 2010 and its historical operating results for each of the three fiscal years in the period

ended January 3, 2010, and the pro forma adjustments that arise as a direct result of the sale of Newsweek magazine. These adjustments are more fully described in the notes to the accompanying unaudited pro forma condensed consolidated financial information. THE WASHINGTON POST COMPANY UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AS OF JULY 4, 2010
(in thousands) Historical TWPC Sale of Newsweek (1) The Company Pro Forma

Assets Current assets Cash and cash equivalents Investments in marketable equity securities and other investments Accounts receivable, net Deferred income taxes Inventories Other current assets Current assets of discontinued operations Total current assets Property, plant, and equipment, net Investment in affiliates Goodwill, net Indefinite-lived intangible assets, net Amortized intangible assets, net Prepaid pension cost Deferred charges and other assets Noncurrent assets of discontinued operations Total assets Liabilities and Equity Current liabilities Accounts payable and accrued liabilities Income taxes payable Deferred revenue Dividends declared Short-term borrowings Current liabilities of discontinued operations Total current liabilities Postretirement benefits other than pensions Accrued compensation and related benefits Other liabilities Deferred income taxes Long-term debt Noncurrent liabilities of discontinued operations Total liabilities Redeemable noncontrolling interest Redeemable preferred stock Preferred stock Common shareholders equity Common stock Capital in excess of par value Retained earnings Accumulated other comprehensive income (loss)

659,027

659,027

392,515 374,901 15,376 9,064 65,622 27,723 1,544,228 1,175,493 42,308 1,368,605 530,406 71,546 412,838 57,430 27,201 $ 5,230,055

(27,723) (27,723) 1,206 (27,201) $(53,718)

392,515 374,901 15,376 9,064 65,622 1,516,505 1,175,493 42,308 1,368,605 530,406 71,546 414,044 57,430 $ 5,176,337

552,321 24,214 375,534 20,930 3,037 50,681 1,026,717 74,817 210,448 123,696 404,382 396,443 14,174 2,250,677 6,843 11,526 20,000 243,987 4,399,356

$ 22,236 3,874 (50,681) (24,571) (8,533) (14,174) (47,278) (6,440)

574,557 28,088 375,534 20,930 3,037 1,002,146 66,284 210,448 123,696 404,382 396,443 2,203,399 6,843 11,526 20,000 243,987 4,392,916

Cumulative foreign currency translation adjustment Unrealized gain on available-for-sale securities Unrealized loss on pensions and other postretirement plans Cost of Class B common stock held in treasury Total The Washington Post Company common shareholders equity Noncontrolling interests Total equity Total liabilities and equity Note:

13,570 81,709 (4,094) (1,794,034) 2,960,494 515 2,961,009 $ 5,230,055

(6,440) (6,440) $(53,718)

13,570 81,709 (4,094) (1,794,034) 2,954,054 515 2,954,569 $ 5,176,337

(1) This column includes the elimination of the historical assets and liabilities of Newsweek magazine estimated to be transferred to the buyer as part of the sale as if the transaction occurred on July 4, 2010. This column also reflects the estimated impact of the Newsweek sale, including certain employee obligations, such as severance, pension and other postretirement benefit obligations, and income taxes payable. 2 THE WASHINGTON POST COMPANY UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME FISCAL YEAR ENDED JANUARY 3, 2010
(in thousands, except per share amounts) Historical TWPC Sale of Newsweek (1) The Company Pro Forma

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 intangible assets Impairment of goodwill and other long-lived assets Income from Operations Equity in losses of affiliates Interest income Interest expense Other income, net Income before Income Taxes Provision for Income Taxes Income from Continuing Operations Loss from Continuing Operations Attributable to Noncontrolling Interests Income from Continuing Operations Attributable to The Washington Post Company Redeemable Preferred Stock Dividends

$2,636,638 858,109 932,402 142,582 4,569,731 2,002,938 2,024,901 295,871 26,642 25,387 4,375,739 193,992 (29,421) 2,597 (31,565) 13,197 148,800 57,600 91,200 1,574 92,774 (928)

(79,951) (86,554) (16,710) (183,215) (134,191) (108,724) (4,187) (247,102) 63,887 63,887 18,800 45,087 45,087

$ 2,636,638 778,158 845,848 125,872 4,386,516 1,868,747 1,916,177 291,684 26,642 25,387 4,128,637 257,879 (29,421) 2,597 (31,565) 13,197 212,687 76,400 136,287 1,574 137,861 (928)

Income from Continuing Operations Available for Common Shares Basic income per common share from continuing operations Basic average number of common shares outstanding Diluted income per common share from continuing operations Diluted average number of common shares outstanding Note:

$ $ $

91,846 9.78 9,332 9.78 9,392

$ 45,087

$ 136,933 $ $ 14.61 9,332 14.57 9,392

(1) The adjustment reflects the elimination of the results of operations of Newsweek magazine as if the transaction occurred on January 1, 2007. The elimination excludes Newsweek magazines historical pension credit since the associated pension assets and liabilities will be retained by the Company. 3 THE WASHINGTON POST COMPANY UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME FISCAL YEAR ENDED DECEMBER 28, 2008
(in thousands, except per share amounts) Historical TWPC Sale of Newsweek (1) The Company Pro Forma

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 intangible assets Impairment of goodwill and other long-lived assets Income from Operations Equity in losses of affiliates Interest income Interest expense Other expense, net Income before Income Taxes Provision for Income Taxes Income from Continuing Operations Income from Continuing Operations Attributable to Noncontrolling Interests Income from Continuing Operations Attributable to The Washington Post Company Redeemable Preferred Stock Dividends Income from Continuing Operations Available for Common Shares Basic income per common share from continuing operations Basic average number of common shares outstanding

$2,331,580 1,083,084 901,898 145,018 4,461,580 2,023,816 1,839,986 265,606 22,525 135,439 4,287,372 174,208 (7,837) 5,672 (24,658) (2,189) 145,196 79,400 65,796 (74) 65,722 (946) $ $ 64,776 6.89 9,408

(128,715) (100,226) (20,924) (249,865) (159,283) (146,242) (2,052) (307,577) 57,712 57,712 27,200 30,512 30,512

$ 2,331,580 954,369 801,672 124,094 4,211,715 1,864,533 1,693,744 263,554 22,525 135,439 3,979,795 231,920 (7,837) 5,672 (24,658) (2,189) 202,908 106,600 96,308 (74) 96,234 (946) $ $ 95,288 10.13 9,408

$ 30,512

Diluted income per common share from continuing operations Diluted average number of common shares outstanding Note:

6.87 9,430

10.11 9,430

(1) The adjustment reflects the elimination of the results of operations of Newsweek magazine as if the transaction occurred on January 1, 2007. The elimination excludes Newsweek magazines historical pension credit since the associated pension assets and liabilities will be retained by the Company. 4 THE WASHINGTON POST COMPANY UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME FISCAL YEAR ENDED DECEMBER 30, 2007
(in thousands, except per share amounts) Historical TWPC Sale of Newsweek (1) The Company Pro Forma

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 intangible assets Income from Operations Equity in earnings of affiliates Interest income Interest expense Other income, net Income before Income Taxes Provision for Income Taxes Income from Continuing Operations Income from Continuing Operations Attributable to Noncontrolling Interests Income from Continuing Operations Attributable to The Washington Post Company Redeemable Preferred Stock Dividends Income from Continuing Operations Available for Common Shares Basic income per common share from continuing operations Basic average number of common shares outstanding Diluted income per common share from continuing operations Diluted average number of common shares outstanding Note:

$2,030,889 1,234,643 817,807 97,067 4,180,406 1,882,984 1,581,596 221,239 17,571 3,703,390 477,016 5,975 11,338 (24,046) 11,182 481,465 192,500 288,965 (358) 288,607 (952) $ 287,655 $ $ 30.31 9,492 30.19 9,528

(155,827) (113,961) (17,476) (287,264) (165,874) (124,168) (2,177) (292,219) 4,955 4,955 1,986 2,969 2,969

$ 2,030,889 1,078,816 703,846 79,591 3,893,142 1,717,110 1,457,428 219,062 17,571 3,411,171 481,971 5,975 11,338 (24,046) 11,182 486,420 194,486 291,934 (358) 291,576 (952) $ 290,624 $ $ 30.62 9,492 30.50 9,528

2,969

(1) The adjustment reflects the elimination of the results of operations of Newsweek magazine as if the

transaction occurred on January 1, 2007. The elimination excludes Newsweek magazines historical pension credit since the associated pension assets and liabilities will be retained by the Company. 5