SEC Filing | E.W. Scripps Company

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2000 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the transition period from ________________ to ________________ Commission File Number 0-16914 THE E. W. SCRIPPS COMPANY (Exact name of registrant as specified in its charter) Ohio 31-1223339 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 312 Walnut Street Cincinnati, Ohio 45202 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (513) 977-3000 Not Applicable (Former name, former address and former fiscal year, if changed since last report.) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. As of April 30, 2000 there were 59,052,521 of the Registrant's Class A Common Shares outstanding and 19,216,913 of the Registrant's Common Voting Shares outstanding.

INDEX TO THE E. W. SCRIPPS COMPANY REPORT ON FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2000 Item No. Page PART I - FINANCIAL INFORMATION 1 Financial Statements 3 2 Management's Discussion and Analysis of Financial Condition and Results of Operations 3 3 Quantitative and Qualitative Disclosures About Market Risk 3 PART II - OTHER INFORMATION 1 Legal Proceedings 3 2 Changes in Securities 3 3 Defaults Upon Senior Securities 3 4 Submission of Matters to a Vote of Security Holders 4 5 Other Information 4 6 Exhibits and Reports on Form 8-K 4

PART I ITEM 1. FINANCIAL STATEMENTS The information required by this item is filed as part of this Form 10-Q. See Index to Financial Information at page F-1 of this Form 10-Q. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information required by this item is filed as part of this Form 10-Q. See Index to Financial Information at page F-1 of this Form 10-Q. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The information required by this item is filed as part of this Form 10-Q. See Index to Financial Information at page F-1 of this Form 10-Q. PART II ITEM 1. LEGAL PROCEEDINGS The Company is involved in litigation arising in the ordinary course of business, such as defamation actions and various governmental and administrative proceedings relating to renewal of broadcast licenses, none of which is expected to result in material loss. ITEM 2. CHANGES IN SECURITIES There were no changes in the rights of security holders during the quarter for which this report is filed. ITEM 3. DEFAULTS UPON SENIOR SECURITIES There were no defaults upon senior securities during the quarter for which this report is filed.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS There were no matters submitted to a vote of security holders during the quarter for which this report is filed. ITEM 5. OTHER INFORMATION None. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K Exhibits The information required by this item is filed as part of this Form 10-Q. See Index to Exhibits at page E-1 of this Form 10-Q. Reports on Form 8-K No reports on Form 8-K were filed during the quarter for which this report is filed.

SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. THE E. W. SCRIPPS COMPANY Dated: May 10, 2000 BY: D. J. Castellini D. J. Castellini Senior Vice President and Chief Financial Officer

THE E. W. SCRIPPS COMPANY Index to Financial Information Item Page Consolidated Balance Sheets F-2 Consolidated Statements of Income F-4 Consolidated Statements of Cash Flows F-5 Consolidated Statements of Comprehensive Income and Stockholders' Equity F-6 Notes to Consolidated Financial Statements F-7 Management's Discussion and Analysis of Financial Condition and Results of Operations Forward Looking Statements F-13 Results of Operations F-13 Newspapers F-15 Broadcast Television F-16 Category Television F-17 Liquidity and Capital Resources F-18 Market Risk F-19

CONSOLIDATED BALANCE SHEETS ( in thousands ) As of March 31, December 31, March 31, 2000 1999 1999 (Unaudited) (Unaudited) ASSETS Current Assets: Cash and cash equivalents $ 19,670 $ 10,456 $ 13,574 Accounts and notes receivable (less allowances -$10,850, $11,266, $9,897) 274,812 280,829 217,844 Program rights and production costs 87,699 93,001 57,755 Network distribution fees 22,220 17,899 12,900 Inventories 17,442 16,235 16,566 Deferred income taxes 27,709 27,769 24,310 Miscellaneous 27,738 31,095 31,489 Total current assets 477,290 477,284 374,438 Investments 275,530 205,864 146,625 Property, Plant and Equipment 484,509 485,596 470,420 Goodwill and Other Intangible Assets 1,222,746 1,191,718 1,199,615 Other Assets: Program rights and production costs (less current portion) 78,679 75,702 62,550 Network distribution fees (less current portion) 41,353 50,066 57,031 Miscellaneous 33,348 33,974 34,304 Total other assets 153,380 159,742 153,885 TOTAL ASSETS $ 2,613,455 $ 2,520,204 $ 2,344,983 See notes to consolidated financial statements.

CONSOLIDATED BALANCE SHEETS ( in thousands, except share data ) As of March 31, December 31, March 31, 2000 1999 1999 (Unaudited) (Unaudited) LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Current portion of long-term debt $ 274,126 $ 267,600 $ 230,785 Accounts payable 91,206 116,201 96,312 Customer deposits and unearned revenue 35,964 40,583 38,084 Accrued liabilities: Employee compensation and benefits 40,681 46,464 39,555 Network distribution fees 40,877 41,712 38,793 Miscellaneous 87,506 64,908 67,503 Total current liabilities 570,360 577,468 511,032 Deferred Income Taxes 167,084 143,912 123,732 Long-Term Debt (less current portion) 501,842 501,847 503,813 Other Long-Term Obligations and Minority Interests (less current portion) 140,141 132,702 123,248 Stockholders' Equity: Preferred stock, $.01 par - authorized: 25,000,000 shares; none outstanding Common stock, $.01 par: Class A - authorized: 120,000,000 shares; issued and outstanding: 59,033,621; 58,925,449; and 59,102,871 shares 590 589 591 Voting - authorized: 30,000,000 shares; issued and outstanding: 19,216,913; 19,216,913; and 19,218,913 shares 192 192 192 Total 782 781 783 Additional paid-in capital 139,713 136,731 147,703 Retained earnings 996,085 973,432 891,346 Unrealized gains on securities available for sale 101,573 57,298 46,744 Foreign currency translation adjustment 946 973 320 Unvested restricted stock awards (5,071) (4,940) (3,738) Total stockholders' equity 1,234,028 1,164,275 1,083,158 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,613,455 $ 2,520,204 $ 2,344,983 See notes to consolidated financial statements.

CONSOLIDATED STATEMENTS OF INCOME ( UNAUDITED ) ( in thousands, except per share data ) Three months ended March 31, 2000 1999 Operating Revenues: Advertising $ 317,699 $ 282,977 Circulation 38,349 40,424 Licensing 16,251 15,766 Joint operating agency distributions 10,883 10,917 Affiliate fees 14,630 11,937 Other 13,047 14,239 Total operating revenues 410,859 376,260 Operating Expenses: Employee compensation and benefits 127,292 117,980 Newsprint and ink 37,192 37,303 Amortization of purchased programming 28,038 23,587 Other operating expenses 117,272 105,664 Depreciation 17,074 16,353 Amortization of intangible assets 9,734 9,636 Total operating expenses 336,602 310,523 Operating Income 74,257 65,737 Other Credits (Charges): Interest expense (12,636) (11,073) Investment results, net of expenses (9,062) (66) Net gains on divested operations 6,269 Miscellaneous, net 946 1,368 Net other credits (charges) (14,483) (9,771) Income Before Taxes and Minority Interests 59,774 55,966 Provision for Income Taxes 25,114 22,932 Income Before Minority Interests 34,660 33,034 Minority Interests 1,056 1,033 Net Income $ 33,604 $ 32,001 Net Income per Share of Common Stock: Basic $.43 $.41 Diluted .43 .40 See notes to consolidated financial statements.

CONSOLIDATED STATEMENTS OF CASH FLOWS ( UNAUDITED ) ( in thousands ) Three months ended March 31, 2000 1999 Cash Flows from Operating Activities: Net income $ 33,604 $ 32,001 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization 26,808 25,989 Deferred income taxes (613) 3,824 Minority interests in income of subsidiary companies 1,056 1,033 Network distribution fee amortization greater (less) than payments 3,182 (6,598) Program cost amortization greater (less) than payments (8,950) (13,060) Other changes in certain working capital accounts, net (4,340) 13,148 Miscellaneous, net 6,570 3,760 Net operating activities 57,317 60,097 Cash Flows from Investing Activities: Additions to property, plant and equipment (15,014) (14,198) Purchase of subsidiary company and long-term investments (52,093) (8,835) Sale of subsidiary companies and long-term investments 24,660 Change in short-term investments, net 20,525 Miscellaneous, net (630) 4,260 Net investing activities (43,077) 1,752 Cash Flows from Financing Activities: Increase in long-term debt 7,900 759 Payments on long-term debt (1,394) (36,827) Repurchase Class A Common shares (16,709) Dividends paid (10,951) (10,970) Dividends paid to minority interests (392) (392) Miscellaneous, net (primarily employee stock compensation) (189) 445 Net financing activities (5,026) (63,694) Increase (Decrease) in Cash and Cash Equivalents 9,214 (1,845) Cash and Cash Equivalents: Beginning of year 10,456 15,419 End of period $ 19,670 $ 13,574 Supplemental Cash Flow Disclosures: Interest paid, excluding amounts capitalized $ 9,236 $ 7,709 Income taxes paid 8,948 11,457 Destin newspaper traded for Fort Pierce newspaper (see Note 2) 3,857 See notes to consolidated financial statements.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME AND STOCKHOLDERS' EQUITY ( UNAUDITED ) ( in thousands, except share data ) Accumulated Unvested Additional Other Restricted Total Common Paid-in Retained Comprehensive Stock Stockholders' Stock Capital Earnings Income Awards Equity Balances at December 31, 1998 $ 785 $ 161,878 $ 870,315 $ 39,485 $ (3,731) $ 1,068,732 Comprehensive income: Net income 32,001 32,001 Unrealized gains, net of deferred tax of $4,253 7,898 7,898 Less: reclassification adjustment for gains in income, net of deferred tax of $31 (58) (58) Increase in unrealized gains on securities 7,840 7,840 Foreign currency translation adjustments (261) (261) Total 32,001 7,579 39,580 Dividends: declared and paid - $.14 per share (10,970) (10,970) Repurchase 391,100 Class A Common Shares (4) (16,705) (16,709) Compensation plans, net: 169,825 shares issued; 821 shares repurchased 2 1,199 (7) 1,194 Tax benefits of compensation plans 1,331 1,331 Balances at March 31, 1999 $ 783 $ 147,703 $ 891,346 $ 47,064 $ (3,738) $ 1,083,158 Balances at December 31, 1999 $ 781 $ 136,731 $ 973,432 $ 58,271 $ (4,940) $ 1,164,275 Comprehensive income: Net income 33,604 33,604 Unrealized gains, net of deferred tax of $24,278 45,080 45,080 Less: reclassification adjustment for gains in income, net of deferred tax of ($433) (805) (805) Increase in unrealized gains on securities 44,275 44,275 Foreign currency translation adjustments (27) (27) Total 33,604 44,248 77,852 Dividends: declared and paid - $.14 per share (10,951) (10,951) Compensation plans, net: 133,251 shares issued; 25,079 shares repurchased 1 1,982 (131) 1,852 Tax benefits of compensation plans 1,000 1,000 Balances at March 31, 2000 $ 782 $ 139,713 $ 996,085 $ 102,519 $ (5,071) $ 1,234,028 See notes to consolidated financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) ______________________________________________________________________ 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation - The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The information disclosed in the notes to consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 1999, has not changed materially unless otherwise disclosed herein. Financial information as of December 31, 1999, included in these financial statements has been derived from the audited consolidated financial statements included in that report. In management's opinion all adjustments (consisting of normal recurring accruals) necessary for a fair presentation of the interim periods have been made. Results of operations are not necessarily indicative of the results that may be expected for future interim periods or for the full year. Net Income Per Share - The following table presents additional information about basic and diluted weighted-average shares outstanding: ( in thousands ) Three months ended March 31, 2000 1999 Basic weighted-average shares outstanding 77,977 78,096 Effect of dilutive securities: Unvested restricted stock held by employees 116 192 Stock options held by employees 731 838 Diluted weighted-average shares outstanding 78,824 79,126 Recently Issued Accounting Standards - The Financial Accounting Standards Board issued FAS No. 133 - Accounting for Derivative Instruments and Hedging Activities. The standard, which must be adopted by January 1, 2001, will not have a material effect on the Company's financial position or its results of operations. Under the new standard changes in the fair value of foreign currency forward and option contracts will be initially reported as a separate component of comprehensive income and reclassified into earnings when the related licensing revenue is earned. Newsprint forward contracts will be recorded at fair value and changes in the value of the contracts will be initially reported as a separate component of comprehensive income and reclassified into earnings when the newsprint is consumed. The Company's accounting for put options and zero-cost collars will not change under the new standard. The Emerging Issues Task Force reached a consensus on Issue 00-2 - Accounting for Web Site Development Costs at its March 2000 meeting. The consensus requires capitalization of certain costs incurred in the development of Internet sites. The Company currently capitalizes the cost of computer hardware and software used in the operation of its Internet sites, however all other development costs are expensed as incurred. Issue 00-2, which must be adopted by September 2000, will require the Company to capitalize such development costs, including graphics and other design costs. The Company has not yet quantified the impact of this change in accounting policy. Reclassifications - For comparative purposes, certain 1999 amounts have been reclassified to conform to 2000 classifications.

2. ACQUISITIONS AND DIVESTITURES Acquisitions 2000 - The Company acquired the daily newspaper in Fort Pierce, Florida, in exchange for its newspaper in Destin, Florida, and cash, and acquired television station KMCI in Lawrence, Kansas, which the Company had previously operated under a Local Management Agreement. 1999 - The Company acquired the 70% of Colorado Real Estate On-Line, a provider of real estate listings on the Internet, that it did not already own and acquired an additional 1.86% interest in The Television Food Network. The following table presents additional information about the acquisitions: ( in thousands ) Three months ended March 31, 2000 1999 Goodwill and other intangible assets acquired $ 44,381 $ 4,250 Other assets acquired 2,646 58 Total 47,027 4,308 Fair value of Destin newspaper (3,857) Liabilities assumed (38) (806) Cash paid $ 43,132 $ 3,502 The acquisitions have been accounted for as purchases. The allocations of the purchase prices are based on preliminary appraised values of the assets acquired and liabilities assumed, and are therefore subject to change. The operating results of the Fort Pierce newspaper are included in the Consolidated Statements of Income from the date of acquisition. Pro forma results are not presented because the combined results of operations would not be significantly different than the reported amounts. The operating results for KMCI were included in the Consolidated Statements of Income while the Company operated the station under the LMA. Divestitures 2000 - The Company sold its independent telephone directories in Memphis, Tennessee, Kansas City, Missouri, and North Palm Beach, Florida, and traded its Destin, Florida, newspaper and cash for the daily newspaper in Fort Pierce, Florida. The sales and trade resulted in net gains of $6,300,000, $3,800,000 after-tax ($.05 per share). Included in the consolidated financial statements are the following results of divested operations (excluding gains on sales): ( in thousands ) Three months ended March 31, 2000 1999 Operating revenues $ 5,505 $ 5,197 Operating income 293 285

3. UNUSUAL CREDITS AND CHARGES In addition to the gains on divested operations described in Note 2, the Company's 2000 net investment income includes i) recognized net investment losses totaling $2,000,000 and ii) a $7,100,000 increase in accrued incentive compensation for Scripps Ventures I's portfolio managers (see Note 5). Net investment results reduced net income $5,900,000 ($.07 per share). The combined effect of unusual credits and charges was to reduce net income $2,100,000, ($.02 per share). 4. LONG-TERM DEBT Long-term debt consisted of the following: ( in thousands ) As of March 31, December 31, March 31, 2000 1999 1999 Variable rate credit facilities, including commercial paper $ 573,590 $ 565,689 $ 530,745 $100 million, 6.625% note, due in 2007 99,890 99,887 99,876 $100 million, 6.375% note, due in 2002 99,949 99,944 99,930 Other notes 2,539 3,927 4,047 Total long-term debt 775,968 769,447 734,598 Current portion of long-term debt 274,126 267,600 230,785 Long-term debt (less current portion) $ 501,842 $ 501,847 $ 503,813 The Company has a Competitive Advance and Revolving Credit Facility Agreement, which permits aggregate borrowings up to $700,000,000 (the "Variable Rate Credit Facilities"). The Variable Rate Credit Facilities are comprised of two unsecured lines, one limited to $400,000,000 principal amount maturing in 2000, and the other limited to $300,000,000 principal amount maturing in 2002. Borrowings under the Variable Rate Credit Facilities are available on a committed revolving credit basis at the Company's choice of three short-term rates or through an auction procedure at the time of each borrowing. The Variable Rate Credit Facilities are also used by the Company in whole or in part, in lieu of direct borrowings, as credit support for its commercial paper. The weighted-average interest rates on the Variable Rate Credit Facilities were 6.1% at March 31, 2000, 6.0% at December 31, 1999, and 5.0% at March 31, 1999.

5. INVESTMENTS Investments consisted of the following: ( in thousands ) As of March 31, December 31, March 31, 2000 1999 1999 Securities available for sale (at market value): Time Warner common stock (1,344,000 shares) $ 134,455 $ 97,227 $ 95,211 Centra Software (1,792,500 common shares) 37,532 garden.com (2,414,000 common shares and 276,000 warrants) 21,098 22,636 iVillage (270,000 common shares) 5,699 5,897 Other 7,686 9,177 5,360 Total available-for-sale securities 206,470 134,937 100,571 Investments accounted for using the equity method 7,210 7,578 7,443 Other (primarily investments in private companies, at adjusted cost) 61,850 63,349 38,611 Total investments $ 275,530 $ 205,864 $ 146,625 Unrealized gains on securities available for sale $ 156,332 $ 88,214 $ 71,928 Investments available for sale represent securities in publicly traded companies, and are recorded at fair value. Fair value is based upon the closing price of the security on the reporting date. In the first quarter of 2000 Centra Software completed an initial public offering of its common stock. In the third quarter of 1999 garden.com completed an initial public offering of its common stock and the Company sold its interest in Family Point, Inc. to iVillage for cash and stock. These investments had previously been included in the other category. The Company intends to sell its iVillage investment in 2000, at the end of the mandatory lock-up period. The Company has executed a zero-cost collar on 229,000 iVillage shares, giving the company the right to sell those shares at prices between $21.02 and $22.65 and giving the counter party the right to purchase the shares at prices between $24.35 and $26.24. The closing price of iVillage common stock was $15.50 on March 31, 2000. Several of the Company's investments in available-for-sale securities declined in value after March 31. As of May 9, 2000, the fair value of the Company's investments in available-for-sale securities was $151,000,000. Securities of private companies do not trade in public markets, so they do not have readily determinable fair values. However, using prices paid by other investors in the most recent round of financing as the fair value, the total estimated value of investments in private companies was $106,000,000 on March 31, 2000. The Company's Scripps Ventures Funds I and II invest in new businesses focusing on new media technology and educational media enterprises. Scripps Ventures I invested $50,000,000. The managers' compensation includes a share of the portfolio's cumulative net gain (realized and unrealized) through June 2001 if a specified minimum return is achieved. This incentive compensation will be paid in 2001. The total accrued incentive compensation was increased to $14,100,000 at March 31, 2000, based on the portfolio's net gain of $94,000,000. Scripps Ventures II is authorized to invest up to $100,000,000, and $15,600,000 was invested as of March 31, 2000. The managers have a minority equity interest in the return on Scripps Ventures II's investments if a specified minimum return is achieved.

6. SEGMENT INFORMATION The Company's reportable segments are strategic businesses that offer different products and services. The Company primarily evaluates the operating performance of its segments based on earnings before interest, income taxes, depreciation and amortization ("EBITDA"), excluding unusual items and all credits and charges classified as non- operating in the Consolidated Statements of Income. No single customer provides more than 10% of the Company's revenue. The Company derives less than 10% of its revenues from markets outside of the U.S. Financial information for the Company's business segments is as follows: ( in thousands ) Three months ended March 31, 2000 1999 OPERATING REVENUES Newspapers $ 230,910 $ 222,577 Broadcast television 76,687 75,367 Category television 73,323 48,200 Licensing and other media 29,939 30,116 Total $ 410,859 $ 376,260 EBITDA Newspapers $ 62,593 $ 65,408 Broadcast television 23,554 21,448 Category television 15,338 4,994 Licensing and other media 4,406 4,251 Corporate (4,826) (4,375) Total $ 101,065 $ 91,726 DEPRECIATION Newspapers $ 10,045 $ 9,377 Broadcast television 4,684 4,695 Category television 1,857 1,815 Licensing and other media 251 226 Corporate 237 240 Total $ 17,074 $ 16,353 AMORTIZATION OF INTANGIBLE ASSETS Newspapers $ 5,591 $ 5,646 Broadcast television 2,352 2,366 Category television 1,727 1,574 Licensing and other media 64 50 Total $ 9,734 $ 9,636 OPERATING INCOME Newspapers $ 46,957 $ 50,385 Broadcast television 16,518 14,387 Category television 11,754 1,605 Licensing and other media 4,091 3,975 Corporate (5,063) (4,615) Total $ 74,257 $ 65,737 OTHER NONCASH ITEMS Broadcast television $ (344) $ 290 Category television (5,424) (19,948) Total $ (5,768) $ (19,658)

( in thousands ) Three months ended March 31, 2000 1999 ADDITIONS TO PROPERTY, PLANT AND EQUIPMENT Newspapers $ 3,414 $ 8,700 Broadcast television 8,675 3,073 Category television 906 1,228 Licensing and other media 1,798 487 Corporate 221 710 Total $ 15,014 $ 14,198 BUSINESS ACQUISITIONS AND OTHER ADDITIONS TO LONG-LIVED ASSETS Newspapers $ 32,001 $ 1,129 Broadcast television 14,605 55 Category television 577 14,739 Licensing and other media 8,956 6,051 Total $ 56,139 $ 21,974 ASSETS Newspapers $1,238,158 $1,231,383 Broadcast television 498,845 483,494 Category television 475,426 370,465 Licensing and other media 344,974 209,408 Corporate 56,052 50,233 Total $2,613,455 $2,344,983 Other noncash items include programming and program production expenses in excess of (less than) the amounts paid, and, for category television, amortization of network distribution fees in excess of (less than) distribution fee payments. Other additions to long-lived assets include investments and network distribution fees. Corporate assets are primarily cash, investments, and refundable and deferred income taxes.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The Company operates in three reportable segments: newspapers, broadcast television and category television. FORWARD-LOOKING STATEMENTS This discussion and the information contained in the notes to the consolidated financial statements contain certain forward-looking statements that are based on management's current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from the expectations expressed in the forward-looking statements. Such risks, trends and uncertainties, which in most instances are beyond the Company's control, include changes in advertising demand and other economic conditions; consumers' taste; newsprint prices; program costs; labor relations; technological developments; competitive pressures; interest rates; regulatory rulings; and reliance on third-party vendors for various products and services. The words "believe," "expect," "anticipate," "estimate," "intend" and similar expressions identify forward-looking statements. All forward- looking statements, which are as of the date of this filing, should be evaluated with the understanding of their inherent uncertainty. RESULTS OF OPERATIONS All per share disclosures included in management's discussion and analysis of financial condition and results of operation are on a diluted basis. Consolidated results of operations were as follows: ( in thousands, except per share data ) Year-to-Date 2000 Change 1999 Operating revenues: Newspapers $ 230,024 3.7 % $ 221,752 Broadcast television 76,687 1.8 % 75,367 Category television 73,323 52.1 % 48,200 Licensing and other media 25,320 (1.6)% 25,744 Total 405,354 9.2 % 371,063 Divested operating units 5,505 5,197 Total operating revenues $ 410,859 9.2 % $ 376,260 Operating income: Newspapers $ 46,874 (6.8)% $ 50,282 Broadcast television 16,518 14.8 % 14,387 Category television 11,754 1,605 Licensing and other media 3,881 2.3 % 3,793 Corporate (5,063) (4,615) Total 73,964 13.0 % 65,452 Divested operating units 293 285 Total operating income 74,257 13.0 % 65,737 Interest expense (12,636) (11,073) Investment results, net of expenses (9,062) (66) Net gains on divested operations 6,269 Miscellaneous, net 946 1,368 Income taxes (25,114) (22,932) Minority interest (1,056) (1,033) Net income $ 33,604 5.0 % $ 32,001 Per share of common stock: Net income $.43 7.5 % $.40 Adjusted net income (excluding investment results and net gains on divested operations) $.45 $.40 NEWSPAPERS - Operating results, excluding divested operations, were as follows: ( in thousands ) Year-to-Date 2000 Change 1999 Operating revenues: Local $ 67,539 0.6 % $ 67,106 Classified 73,787 9.2 % 67,599 National 8,779 5.9 % 8,292 Preprint and other 27,229 13.4 % 24,021 Newspaper advertising 177,334 6.2 % 167,018 Circulation 38,289 (5.2)% 40,370 Joint operating agency distributions 10,883 (0.3)% 10,917 Other 3,518 2.1 % 3,447 Total operating revenues 230,024 3.7 % 221,752 Operating expenses, excluding depreciation and amortizataion: Editorial and newspaper content 26,818 5.3 % 25,479 Newsprint and ink 36,230 (0.3)% 36,325 Other press and production 23,778 8.2 % 21,979 Circulation and distribution 28,131 16.7 % 24,107 Commercial printing and other 8,241 44.0 % 5,723 Advertising sales and marketing 22,078 11.1 % 19,878 General and administrative 22,287 (3.1)% 23,002 Total 167,563 7.1 % 156,493 EBITDA 62,461 (4.3)% 65,259 Depreciation and amortization 15,587 4.1 % 14,977 Operating income $ 46,874 (6.8)% $ 50,282 Other Financial and Statistical Data: Percent of operating revenues: EBITDA 27.2 % 29.4 % Operating income 20.4 % 22.7 % Capital expenditures $ 3,414 $ 8,686 Business acquisitions and other additions to long-lived assets 32,001 1,129 Circulation revenue decreased primarily due to promotions and discounts offered in the Denver market. Circulation and distribution costs increased due to the effort to gain market share in Denver. Excluding Denver, EBITDA increased 1%. Newsprint prices decreased 9%, which was offset by a 9% increase in newsprint consumed. The increase in consumption is primarily due to an 18% year-over-year increase in circulation in the Denver market. The newspapers' Internet businesses had EBITDA of $(1.0) million, compared to $(0.2) million in the first quarter of 1999.

BROADCAST TELEVISION - Operating results were as follows: ( in thousands ) Year-to-Date 2000 Change 1999 Operating revenues: Local $ 41,079 (0.5)% $ 41,303 National 30,052 3.8 % 28,939 Political 1,741 364 Other 3,815 (19.9)% 4,761 Total operating revenues 76,687 1.8 % 75,367 Operating expenses, excluding depreciation and amortization: Programming and station operations 37,287 (1.2)% 37,726 Sales and marketing 9,891 5.7 % 9,355 General and administrative 5,955 (12.9)% 6,838 Total 53,133 (1.5)% 53,919 EBITDA 23,554 9.8 % 21,448 Depreciation and amortization 7,036 (0.4)% 7,061 Operating income $ 16,518 14.8 % $ 14,387 Other Financial and Statistical Data: Percent of operating revenues: EBITDA 30.7 % 28.5 % Operating income 21.5 % 19.1 % Capital expenditures $ 8,675 $ 3,073 Business acquisitions and other additions to long-lived assets 14,605 55 EBITDA improved primarily due to increased political advertising and cost reduction initiatives. Other revenue is primarily network compensation. The Company's network compensation revenues decreased $1.2 million in the first quarter of 2000, and are expected to be down approximately $3.0 million, to $10.0 million, for the full year.

CATEGORY TELEVISION - Operating results were as follows: ( in thousands ) Year-to-Date 2000 Change 1999 Operating revenues: Advertising $ 57,475 71.5 % $ 33,505 Affiliate fees 14,630 22.6 % 11,937 Other 1,218 (55.8)% 2,758 Total operating revenues 73,323 52.1 % 48,200 Operating expenses, excluding depreciation and amortization: Programming and production 19,958 29.9 % 15,370 Operations and distribution 8,516 49.0 % 5,716 Amortization of distribution fees 4,396 1.7 % 4,322 Sales and marketing 14,586 29.8 % 11,237 General and administrative 11,488 64.1 % 6,999 Total 58,944 35.1 % 43,644 EBITDA - consolidated networks 14,379 4,556 Share of pre-tax earnings of equity-method investments 959 438 Total EBITDA 15,338 4,994 Depreciation and amortization 3,584 5.8 % 3,389 Operating income (loss) $ 11,754 $ 1,605 Other Financial and Statistical Data: Percent of operating revenues: EBITDA 20.9 % 10.4 % Operating income 16.0 % 3.3 % Payments for programming and network distribution fees less than (greater than) amounts recognized as expense $ (5,424) $ (19,948) Capital expenditures 906 1,228 Business acquisitions and other additions to long-lived assets 577 14,739 According to the Nielsen Homevideo Index ("Nielsen"), HGTV was distributed to 60.5 million homes in March 2000, up 8.6 million from March 1999 and up 1.5 million in the quarter. Food Network was distributed to 46.4 million homes in March 2000, up 7.3 million from March 1999 and up 2.2 million in the quarter. The Company launched DIY, its third network, in the fourth quarter of 1999. DIY had EBITDA of $(2.0) million in the first quarter of 2000. HGTV's and Food Network's Internet businesses had EBITDA of $(1.7) million in the first quarter of 2000, versus breakeven last year, primarily due to promotional spending for foodtv.com.

LIQUIDITY AND CAPITAL RESOURCES The Company generates significant cash flow from operating activities. There are no significant legal or other restrictions on the transfer of funds among the Company's business segments. Cash flow provided by operating activities in excess of capital expenditures is used primarily to fund corporate expenditures or to invest in new businesses. Management expects total cash flow from operating activities in 2000 will be sufficient to meet the Company's expected total capital expenditures, required interest payments and dividend payments. Management is authorized to repurchase an additional 2.2 million shares of the Company's Class A Common shares under a 1998 authorization from the Board of Directors. The Company's Scripps Ventures Funds invest in new businesses focusing on new media technology and educational media enterprises. See Note 5 to the Consolidated Financial Statements. The Board of Directors has authorized up to $150 million of such investments. At March 31, 2000, an additional $84 million remains to be invested under the authorization. Net debt (borrowings less cash equivalent and other short-term investments) increased $6.3 million, to $776 million at March 31, 2000. The Company currently intends to repay debt only when there are not more productive uses for excess cash. The Company expects to extend the $400 million one-year portion of its variable credit facility, or to refinance borrowings under that line. Management believes the Company's cash flow from operations and substantial borrowing capacity, taken together, provide adequate resources to fund expansion of existing businesses and the development or acquisition of new businesses.

MARKET RISK The Company's earnings and cash flow can be affected by, among other things, interest rate changes, foreign currency fluctuations (primarily in the exchange rate for the Japanese yen) and changes in the price of newsprint. The information disclosed in Market Risk in the Company's Annual Report on Form 10-K for the year ended December 31, 1999, has not changed materially unless otherwise disclosed here-in. The Company may use foreign currency forward and option contracts to hedge its cash flow exposures denominated in Japanese yen and forward contracts to reduce the risk of changes in the price of newsprint on anticipated newsprint purchases. The Company held no foreign currency or newsprint forward contracts at March 31, 2000, or December 31, 1999. The following table presents additional information about the Company's market-risk-sensitive financial instruments: ( in thousands ) As of March 31, 2000 As of December 31, 1999 Cost Fair Cost Fair Basis Value Basis Value Financial instruments subject to interest rate risk: Variable rate credit facilities, including commercial paper $ 573,590 $ 573,590 $ 565,689 $ 565,689 $100 million, 6.625% note, due in 2007 99,890 95,000 99,887 94,668 $100 million, 6.375% note, due in 2002 99,949 98,000 99,944 98,107 Other notes 2,539 1,510 3,927 2,836 Total long-term debt $ 775,968 $ 768,100 $ 769,447 $ 761,300 Financial instruments subject to market value risk: Time Warner common stock (1,344,000 shares) $ 27,814 $ 134,455 $ 27,816 $ 97,227 Centra Software (1,792,500 common shares) 3,652 37,532 garden.com Inc. (2,414,000 common shares and 276,000 warrants) 9,628 21,098 9,625 22,636 iVillage Inc. (270,000 common shares) 5,892 5,699 5,897 5,897 Other available-for-sale securities 3,152 7,686 3,385 9,177 Total investments in publicly-traded companies 50,138 206,470 46,723 134,937 Investments in private companies 61,850 (a) 63,349 (a) (a) Investments in private companies do not trade in public markets, so they do not have readily determinable fair values. However, based upon amounts paid for such securities by other investors in subsequent rounds of financing, if any, the estimated value of these investments exceeded their cost by approximately $44,200,000 on March 31, 2000. The Company manages interest rate risk primarily by maintaining a mix of fixed-rate and variable-rate debt. The Company currently does not use interest rate swaps, forwards or other derivative financial instruments to manage its interest rate risk. See Note 4 to the Consolidated Financial Statements. The weighted-average interest rate on borrowings under the Variable Rate Credit Facilities was 6.1% at March 31, 2000 and 6.0% at December 31, 1999. The Company holds 1,792,500 shares of Centra Software, which became publicly traded in January 2000. The Company's investment in Centra Software had previously been included in private companies in the above table. The estimated fair value of the Centra Software investment on December 31, 1999, was $6 million. Several of the Company's investments in publicly-traded companies declined in value after March 31. As of May 9, 2000, the fair value of the Company's investments in publicly-traded companies was $151 million.

THE E. W. SCRIPPS COMPANY Index to Exhibits Exhibit No. Item Page 12 Ratio of Earnings to Fixed Charges E-2

RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12 ( in thousands ) Three months ended March 31, 2000 1999 EARNINGS AS DEFINED: Earnings from operations before income taxes after eliminating undistributed earnings of 20%- to 50%-owned affiliates $ 60,335 $ 56,346 Fixed charges excluding capitalized interest and preferred stock dividends of majority-owned subsidiary companies 14,447 12,408 Earnings as defined $ 74,782 $ 68,754 FIXED CHARGES AS DEFINED: Interest expense, including amortization of debt issue costs $ 12,636 $ 11,073 Interest capitalized 14 11 Portion of rental expense representative of the interest factor 1,811 1,335 Preferred stock dividends of majority-owned subsidiary companies 20 20 Fixed charges as defined $ 14,481 $ 12,439 RATIO OF EARNINGS TO FIXED CHARGES 5.16 5.53

5 1000 3-MOS DEC-31-2000 MAR-31-2000 19,670 0 285,662 10,850 17,442 477,290 950,556 466,047 2,613,455 570,360 501,842 0 0 782 1,233,246 2,613,455 0 410,859 0 0 333,612 2,990 12,636 59,774 25,114 33,604 0 0 0 33,604 $.43 $.43

5 1000 3-MOS DEC-31-1999 MAR-31-1999 13,574 0 227,741 9,897 16,566 374,438 904,432 434,012 2,344,983 511,032 503,813 0 0 783 1,082,375 2,344,983 0 376,260 0 0 307,718 2,805 11,073 55,966 22,932 32,001 0 0 0 32,001 $.41 $.40