American Lawyer Media Reports 40.0% EBITDA Increase in Third Quarter of FY 2002.Business Editors/Legal Writers NEW YORK--(BUSINESS WIRE)--Nov. 13, 2002 American Lawyer Media ALM (formerly American Lawyer Media), is a leading integrated media company, focused on the legal and real estate communities. ALM owns and publishes 33 national and regional magazines and newspapers focused on the legal and real estate communities, including , Inc. (ALM), the nation's leading legal journalism journalism, the collection and periodic publication or transmission of news through media such as newspaper, periodical, television, and radio. Schools and information company, announced today that third quarter FY 2002 earnings before interest, taxes, depreciation, amortization and other extraordinary income and expense (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) reached $6.8 MM, an increase of 40.0%, or $1.9MM, over the third quarter of FY 2001, as the company released results for the third quarter of its 2002 fiscal year, ending September September: see month. 30. Revenues for the third quarter of FY 2002 totaled $31.6 MM, a decrease of 5.9 %, or $2.0 MM, over the comparable period in FY 2001. Total operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. for the third quarter of FY 2002 decreased to $28.9 MM, a decline of 20.3%, or $7.3 MM, compared to the third quarter of FY 2001. Net operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. for the third quarter of FY 2002 was $2.7 MM, an increase of $5.4 MM, compared to comparable results for the third quarter of FY 2001. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. revenues for FY 2002 were $98.4 MM, a decrease of 10.9%, or $12.0 MM, compared to the same period of FY 2001. Year-to-date total operating expenses decreased to $93.5 MM, a reduction of 18.5%, or $21.2 MM, over the comparable FY 2001 period. Year-to-date EBITDA was $17.5 MM, a decrease of 4.4%, or $0.8 MM, over the comparable period in FY 2001. Year-to-date net operating profit for FY 2002 was $4.9 MM, an increase of $9.2 MM, compared to comparable results for the first nine months of 2001. "Bottom line performance in the third quarter showed continued improvement as our significant cost-cutting measures, implemented over the past year, took hold," said William William, crown prince of Germany William or Frederick William, 1882–1951, crown prince of Germany, son of William II. In World War I he commanded (1914) an army on the Western Front and was nominal commander in the German attack Pollak Pollak is a surname, and may refer to:
, President and Chief Executive Officer of ALM. "These steps, combined with increased stability in some revenue sectors, enabled us to achieve EBITDA gains for the second consecutive quarter." On May 1, 2002, ALM acquired the Web content and seminar businesses previously operated by Law.com, Inc. Third quarter and year-to-date results for FY 2002 include revenues and expenses relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the businesses acquired, dating from May 1, 2002, as well as revenues and expenses recorded by ALM as a result of a licensing agreement with Law.com prior to May 1, 2002. ALM's year-to-date FY 2001 results include revenues and expenses recorded by ALM as a result of a licensing agreement with Law.com. Prior to the acquisition, Law.com spun off its legal application services See ASP and Web services. businesses, RealLegal, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , to the shareholders of Law.com. ALM's third quarter and year-to-date FY 2002 results include revenues received by ALM as a result of a licensing agreement with RealLegal, LLC, effective as of May 1, 2002. ALM expects to continue receiving licensing revenue from RealLegal, LLC, during the remainder of FY 2002. ALM's third quarter FY 2002 results include restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of $0.8 MM. ALM had previously recorded restructuring charges of $0.3 MM during the second quarter of FY 2002, bringing the year-to-date FY 2002 total to $1.1 MM. ALM's comparable year-to-date FY 2001 results include restructuring charges of $1.7 MM, recorded by the company in the second quarter of FY 2001. Restructuring charges in both FY 2002 and FY 2001 consist primarily of severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when payments associated with staff reductions. ALM's EBITDA results include barter barter: see exchange. barter Direct exchange of goods or services without the use of money or any other intervening medium of exchange. Barter is conducted either according to established rates of exchange or by bargaining. transactions for equity with third parties totaling $0.5 MM and $0.4 MM, respectively, for the third quarter of FY 2002 and the third quarter of FY 2001, as well as $2.6 MM and $1.4 MM, respectively, for the nine months ended September 30, 2002 and September 30, 2001. ALM incurred operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. at Law.com of $0.8 MM in the third quarter of FY 2002 and $1.3 MM on a year-to-date basis since the acquisition of Law.com on May 1, 2002. Adjusting for barter transactions, as well as the Law.com transaction, adjusted EBITDA for the third quarter of FY 2002 totaled $7.0 MM, an increase of 59.5%, or $2.6 MM, over the third quarter of FY 2001. Adjusted year-to-date EBITDA for FY 2002 totaled $16.2 MM, a decrease of 4.1%, or $0.7 MM, over adjusted FY 2001 EBITDA. In the third quarter of FY 2002, the company experienced quarterly revenue declines in the display, classified and public notice advertising categories. Third quarter advertising revenues for the company were $18.6 MM, a decrease of 7.8%, or $1.6 MM, over the third quarter of FY 2001. Subscription revenues for the third quarter totaled $6.2 MM, an increase of 7.7%, or $0.4 MM, compared to the third quarter of FY 2001. Third quarter revenues from ancillary Subordinate; aiding. A legal proceeding that is not the primary dispute but which aids the judgment rendered in or the outcome of the main action. A descriptive term that denotes a legal claim, the existence of which is dependent upon or reasonably linked to a main claim. products and services, including tradeshows, and database and research fees, decreased by 11.2%, or $0.9 MM, from the third quarter of FY 2001. Operating expenses totaled $28.9 MM for the third quarter of FY 2002, a decrease of 20.3%, or $7.3 MM, over the third quarter of FY 2001. Lower operating expenses during the third quarter of FY 2002 were realized from the discontinuation dis·con·tin·u·a·tion n. A cessation; a discontinuance. Noun 1. discontinuation - the act of discontinuing or breaking off; an interruption (temporary or permanent) discontinuance of goodwill amortization, as well as lower production, selling, editorial and general and administrative expenses. A consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: statement of operations See Income statement. for the third quarter and the nine months ended September 30, 2002 and 2001, as well as a September 30, 2002 and September 30, 2001 balance sheet, are included as attachments to this press release. Further details on company results for the third quarter of FY 2002 are available in reports filed by ALM and its parent corporation, American Lawyer Media Holdings, Inc., with the Securities and Exchange Commission. Headquartered in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , ALM is a leading integrated media company, focused on the legal industry. ALM currently owns and publishes 23 national and regional legal magazines and newspapers, including The American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Lawyer(R) and The National Law Journal(R). ALM's other businesses include book, custom and newsletter publishing, production of legal trade shows and conferences, educational seminars and distribution of content related to the legal industry. ALM's law.com(R) site (www.law.com) is the Web's premier destination for legal professionals. ALM also operates the nation's most comprehensive court verdict and settlement reporting system, available online at www.verdictsearch.com. ALM was formed by U.S. Equity Partners, L.P., a private equity fund sponsored by Wasserstein Was·ser·stein , Wendy Born 1950. American playwright noted for her comedies, such as The Heidi Chronicles (1988), for which she won a Pulitzer Prize. & Co., LP. More information on ALM, its business and services is available on the Web at www.americanlawyermedia.com. Portions of this release may contain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. regarding plans, projections or the future performance of American Lawyer Media, Inc. These forward-looking statements are subject to risks and uncertainties. Important cautionary statements and a discussion of risk factors that could affect actual performance are contained in the materials filed by American Lawyer Media, Inc. with the Securities and Exchange Commission.
American Lawyer Media, Inc.
Consolidated Statements of Operations
(In thousands)
(unaudited)
For the Three Months Ended
September 30,
-------- --------
2002 2001
-------- --------
REVENUES:
Periodicals:
Advertising $ 18,634 $ 20,209
Subscription 6,194 5,754
Ancillary products and services 6,782 7,640
-------- --------
Total revenues 31,610 33,603
-------- --------
OPERATING EXPENSES:
Editorial 5,253 5,693
Production and distribution 6,191 6,790
Selling 6,343 6,826
General and administrative 7,028 9,440
Depreciation and amortization 4,121 7,536
-------- --------
Total operating expenses 28,936 36,285
-------- --------
Operating income (loss) 2,674 (2,682)
Interest expense (4,641) (4,994)
Other income (loss) 928 (843)
-------- --------
Loss before income taxes (1,039) (8,519)
Benefit for income taxes 1,095 805
-------- --------
Net income (loss) $ 56 $ (7,714)
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American Lawyer Media, Inc.
Consolidated Statements of Operations
(In thousands)
(unaudited)
For the Nine Months Ended
September 30,
--------- ---------
2002 2001
--------- ---------
REVENUES:
Periodicals:
Advertising $ 56,774 $ 64,768
Subscription 17,738 17,312
Ancillary products and services 23,883 28,355
--------- ---------
Total revenues 98,395 110,435
--------- ---------
OPERATING EXPENSES:
Editorial 16,182 17,464
Production and distribution 19,208 23,425
Selling 19,756 21,659
General and administrative 25,770 29,598
Depreciation and amortization 12,570 22,530
--------- ---------
Total operating expenses 93,486 114,676
--------- ---------
Operating income (loss) 4,909 (4,241)
Interest expense (14,206) (15,064)
Other income (loss) 782 (5,515)
--------- ---------
Loss before income taxes (8,515) (24,820)
Benefit for income taxes 2,548 1,850
--------- ---------
Net loss $ (5,967) $ (22,970)
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American Lawyer Media, Inc.
Consolidated Balance Sheets
(In thousands, except share data)
Sept. 30, Dec. 31,
2002 2001
--------- --------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 1,432 $ 2,377
Accounts receivable, net of allowance for
doubtful accounts and returns of
$2,260 and $2,270, respectively 14,291 16,051
Deferred tax assets, net 3,925 3,925
Inventories, net 1,393 1,530
Due from parent 2,589 676
Other current assets 3,003 2,555
--------- ---------
Total current assets 26,633 27,114
Property, plant and equipment, net of
accumulated depreciation and
amortization of $19,435 and $14,744,
respectively 12,443 11,384
Intangible assets, net of accumulated
amortization of $55,548 and $47,670,
respectively 121,244 129,122
Goodwill, net of accumulated amortization
of $48,490 and $48,490, respectively 162,694 141,041
Deferred financing costs, net of
accumulated amortization of $3,584 and
$3,391, respectively 5,060 4,525
Other assets 5,340 1,664
--------- ---------
Total assets $ 333,414 $ 314,850
========= =========
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
Accounts payable $ 5,844 $ 5,941
Accrued expenses 9,181 10,627
Accrued interest payable 5,304 954
Deferred income (including deferred
subscription income of $17,355 and
$15,065, respectively) 21,531 18,515
Other current liabilities -- 350
--------- ---------
Total current liabilities 41,860 36,387
Long-term debt:
Revolving credit
facility 28,200 27,000
Senior notes 175,000 175,000
--------- ---------
Total long-term debt 203,200 202,000
Deferred income taxes 22,503 25,366
Other noncurrent liabilities 5,868 7,271
--------- ---------
Total liabilities 273,431 271,024
Stockholder's equity:
Common stock-$.01 par value; 1,000 shares
authorized; 100 issued and outstanding
at September 30, 2002 and December 31, 2001 -- --
Paid-in-capital 152,462 130,253
Accumulated deficit (92,411) (86,444)
Accumulated other comprehensive (loss)
gain (68) 17
--------- ---------
Total stockholder's equity 59,983 43,826
--------- ---------
Total liabilities and
stockholder's equity $ 333,414 $ 314,850
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