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Investor Relations

SEC Filings

10-Q
GRAHAM HOLDINGS CO filed this Form 10-Q on 11/15/1994
Entire Document
 
<PAGE>   11


                                                                             11.


first nine months of 1993.  At the end of September 1994, domestic cable
operations had 492,000 basic subscribers as compared to 481,000 basic
subscribers at the same time last year.

OTHER BUSINESSES.  At the company's other businesses, revenues rose 6 percent
in the first three quarters of 1994.  Improved results at Stanley H. Kaplan
Educational Centers and Moffet, Larson & Johnson were the major contributors to
the increase over 1993.

EQUITY IN EARNINGS AND LOSSES OF AFFILIATES.  The company's equity in earnings
of affiliates during the first nine months of 1994 was income of $7.9 million,
compared with a loss of $2.4 million in the first nine months of 1993. The
one-time after-tax gain of $8.4 million on the sale of land at one of the
company's newsprint affiliates was the major contributor to the improvement.

NON-OPERATING ITEMS.  Interest income, net of interest expense, was $2.8
million for the first three quarters of 1994 compared to $4.3 million in the
same period of last year. The decline was primarily due to lower invested cash
balances offset slightly by higher interest rates.  In 1993 net interest income
included the capitalization of interest as well as higher invested cash
balances and lower interest rates.

         Other income in the first three quarters of 1994 was $3.1 million,
compared with $19.9 million in the comparable period of 1993.  In 1994 other
income included a gain of $2.5 million resulting from a change in the company's
ownership interest in one of its affiliates. In 1993, the company recorded a
$13.4 million after-tax gain on the sale of its cable franchises in the United
Kingdom.

INCOME TAXES.  The effective income tax rate for the first nine months of 1994
was essentially unchanged from the same period last year. The effective rate
for the first three quarters of 1994 reflected the impact and accounting
treatment of foreign taxes on the gain on the sale of land at one of the
company's newsprint affiliates.  Income from affiliates is recorded by the
company at the company's share of after-tax net income of the affiliate. The
effective tax rate for the first nine months of 1993 included the effect of
foreign taxes on the sale of the company's cable franchises in the United
Kingdom.