Journal Communications (JRN)

Founded in 1882, Journal Communications, Inc., (JRN) is a diversified media company with publishing, broadcasting (TV & radio), printing, and direct marketing businesses. Its telecommunications business was sold in Febuary 2007.

Publishing (46% of 2007 revenue): The company generates the largest portion of revenue from Milwaukee, than from any other market accounting for one of every three advertising dollars spent. Journal Communications' largest individual property is the Milwaukee Journal Sentinel, the only major daily and Sunday newspaper targeted at the Milwaukee metropolitan area. The Sunday Milwaukee Journal Sentinel is ranked number one in readership among the 50 most populated markets in the United States with a 69% penetration rate, and the daily newspaper ranks number three with a 43% penetration rate (according to a 2007 readership survey by Scarborough Research). Outside of Milwaukee, JRN owns about 52 community newspapers and shoppers in Wisconsin and Florida.

Broadcasting (37% of 2007 revenue): The company's broadcasting division operates 11 TV stations and 35 radio stations in mid-sized markets in 12 states. Revenue from television and radio operations, respectively accounted for 61% and 39% of broadcasting revenue.

Printing (12% of 2007 revenue): Printing services business is conducted through a wholly owned subsidiary, IPC Print Services, Inc. (IPC).

Other Business (5% of 2007 revenue): Other business primarily focuses on direct marketing services business conducted through the wholly owned subsidiary, PrimeNet, a label printing business.

Revenue & Operating Earnings by Division 2Q08

Revenue

Revenue

Op. Inc.

Op. Inc.

Op. Inc.

Division

$ in Mil.

% of Total

$ in Mil.

% of Total

Margins

Publishing

$61.8

44.1%

$5.7

34.3%

9.2%

Broadcasting

$53.5

38.2%

$9.7

58.4%

18.2%

Printing Services

$16.8

12.0%

$0.8

4.8%

4.8%

Other

$8.0

5.7%

$0.4

2.4%

5.0%

$140.1

100.0%

$16.6

100.0%

11.9%

IPO

From 1937 until September 2003, JRN was privately held with the majority of shares owned by employees. In September 2003, the company made an initial public offering (IPO) of 19.8 million shares, and used the $267 million in proceeds plus $82 million on its credit facility to tender 20 million shares of the employees at the IPO price of $15.00 per share. This was intended to allow the employees to repay personal debt incurred to purchase shares. In addition, by creating a public market for the stock, JRN would no longer be required to fund share repurchases or pay higher-than-average dividends to provide employees with the means to service their margin for debt.

Journal Communications has four classes of stock: Class A (26.9 million shares), Class B-1 (14.1 million shares), Class B-2 (39.9 million shares) and Class C (3.3 million shares). Class A shares are publicly traded. Class B-1 shares are held by employees and the founding Grant family (B-1 shares have a shorter lock-up period than B-2). Class C shares are held by Matex Inc., the Albert Family Journal Stock Trust, and Grant family.

Read full report on Journal Communications Class A

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