the company's affiliated newsprint mills, which are benefiting from higher
NON-OPERATING ITEMS. Interest income, net of interest expense, was $.5
million, compared with $.1 million in the same period last year.
INCOME TAXES. The effective income tax rate for the third quarter of 1995
declined to 34 percent from 39 percent in the third quarter of 1994. The
decrease is due to the recognition of certain tax benefits associated with the
company's write-off of its investment in Mammoth Micro Productions. Both the
third quarter of 1995 and 1994 include the impact of the revised effective
income tax rates for the first half of each year.
NINE MONTH COMPARISONS
For the first nine months of 1995, net income was $137.2 million
($12.35 per share), up from net income of $117.5 million ($10.11 per share) in
the same period last year.
The company's results for the first nine months of 1995 include $8.4
million ($0.75 per share) from the sale, at its orginal cost, of substantially
all of the company's investment in American PCS, L.P., as well as the after-tax
charge of $5.6 million ($0.51 per share) relating to the write-off of the
company's investment in Mammoth Micro Productions. Results for the first nine
months of 1994 include an after-tax gain of $8.4 million ($0.73 per share) on
the sale of land at one of the company's newsprint affiliates. Excluding the
effect of these one-time items, 1995 earnings rose 23.1 percent and earnings
per share increased 28.9 percent in the first three quarters this year over the
same period last year, with fewer shares outstanding in 1995.
Total revenues for the first nine months of 1995 increased 8.0 percent
to $1,256.5 million, from $1,163.1 million in the comparable period last year.
Advertising revenues increased 9.5 percent, and circulation and subscriber
revenues rose 2.8 percent. Other revenues increased 13.6 percent over the
first three quarters of 1994.
Total costs and expenses increased 9.0 percent during the first nine
months of 1995 to $1,063.7 million, from $976.1 million in the corresponding
period of 1994. Operating expenses increased 9.2 percent, and selling, general
and administrative expenses increased 6.9 percent compared with the first three
quarters of 1994. Approximately 15.0 percent of the total increase in costs
and expenses is related to the write-off of the company's investment in Mammoth
Micro Productions. In addition, a 29.3 percent increase in newsprint costs
accounted for approximately 24.0 percent of the total increase.
In the first three quarters of 1995 operating income rose to $192.8
million, a 3.1 percent increase over $187.0 million in the same period last
year. Excluding the one-time charge resulting from the