Document/Exhibit Description Pages Size
1: 10-K Annual Report 22 122K
2: EX-10.(E) Benefit Equalization Plan 15 30K
3: EX-10.(F) Incentive Compensation Plan 29 52K
4: EX-13 Annual Report 51 233K
5: EX-21 Subsidiaries of Capital Cities/Abc 4 19K
6: EX-99.(A) Form 11-K 22 72K
7: EX-99.(B) Undertakings 1 8K
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 1993.
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____________ to ____________.
Commission file number 1-4278
Capital Cities/ABC, Inc.
(Exact name of registrant as specified in its charter)
New York 14-1284013
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
77 West 66th Street, New York, N.Y. 10023-6298
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 456-7777
Securities registered pursuant to Section 12(b) of the Act:
(Name of each exchange
(Title of each class) on which registered)
Common Stock, $1.00 par value New York Stock Exchange
Pacific Stock Exchange
Preferred Share Purchase Rights New York Stock Exchange
Pacific Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
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 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 by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of the voting stock held by non-affiliates of the
registrant is $8,752,000,000 as of February 28, 1994.
The number of shares outstanding of the issuer's common stock as of February 28,
1994: 15,338,311 shares, excluding 3,055,185 treasury shares.
Portions of Part I are incorporated herein by reference to the 1993 Annual
Report to Shareholders and the definitive Proxy Statement for the annual meeting
of shareholders to be held on May 19, 1994.
Part II and Part IV, with the exception of certain schedules and exhibits, are
incorporated herein by reference to the 1993 Annual Report to Shareholders.
Part III is incorporated herein by reference to the definitive Proxy Statement
for the annual meeting of shareholders to be held on May 19, 1994.
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K-1
PART I
Item 1. Business.
Capital Cities/ABC, Inc., directly or through its subsidiaries (the "Company"),
operates the ABC Television Network, eight television stations, the ABC Radio
Networks and 18 radio stations, and provides programming for cable television.
The Company, through joint ventures, is engaged in international broadcast/cable
services and television production and distribution. The Company also publishes
daily and weekly newspapers, shopping guides, various specialized and business
periodicals, books, provides research services and also distributes information
from data bases.
Employees
At December 31, 1993, the Company had approximately 19,250 full-time equivalent
employees: 10,000 in broadcasting operations, 9,000 in publishing operations and
250 in corporate activities.
Industry Segments
Information relating to the industry segments of the Company's operations is
included on page 37 of the Company's Annual Report to Shareholders and is hereby
incorporated by reference. In 1993, the Company derived approximately 85% and
70% of its broadcasting and publishing revenues, respectively, from the sale of
advertising. The remainder of the broadcasting revenues are principally derived
from subscriber-related fees and programming distribution activities. The
balance of publishing revenues are derived primarily from subscription and other
circulation receipts and the sale of books.
Broadcasting
Television and Radio Networks
The Company operates the ABC Television Network which as of December 31, 1993
had 228 primary affiliated stations reaching 99.9% of all U.S. television
households. A number of secondary affiliated stations add to the primary
coverage. The ABC Television Network broadcasts programs in "dayparts" and types
as follows: Monday through Friday early morning, daytime and late night, Monday
through Sunday Prime Time and News, Children's and Sports. The Company also
operates the ABC Radio Networks which served a total of approximately 3,400
affiliates as of December 31, 1993 through eight different program services,
each with its own group of affiliated stations. The ABC Radio Networks also
produces and distributes a number of radio program series for radio stations
nationwide.
Generally, the Company pays the cost of producing or purchasing the broadcast
rights for its network programming and pays varying amounts of compensation to
its affiliated stations for broadcasting the programs and commercial
announcements included therein. Substantially all revenues from network
operations are derived from the sale to advertisers of time in network programs
for commercial announcements. The ability to sell time for commercial
announcements and the rates received are dependent on the quantitative and
qualitative audience that the network can deliver to the advertiser.
The Company also produces television programs for the ABC Television Network and
for other exhibitors of television programs. For television programs it
produces, the Company pays the costs of production and typically receives a
license fee from the exhibitor for initial exhibition. Generally, the license
fees received are less than the costs of production. The Company then licenses
the programs it owns for foreign exhibition and, ultimately, for repeat
exhibition in the United States.
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Television and Radio Stations
The Company owns seven very high frequency (VHF) television stations, one ultra
high frequency (UHF) television station, nine standard (AM) radio stations and
nine frequency modulation (FM) radio stations. All television stations are
affiliated with the ABC Television Network and all radio stations, except as
noted, are affiliated with the ABC Radio Networks. Markets, frequencies and
other station details are set forth in the following tables:
[Download Table]
Television stations
Expiration Television
Station date of FCC market
and market Channel authorization ranking(1)
---------------------------- ---------- ------------- -------------------
WABC-TV (New York, NY) ..... 7 June 1, 1994 1
KABC-TV (Los Angeles, CA) .. 7 (2) 2
WLS-TV (Chicago, IL) ....... 7 Dec. 1, 1997 3
WPVI-TV (Philadelphia, PA) . 6 Aug. 1, 1994 4
KGO-TV (San Francisco, CA) . 7 (2) 5
KTRK-TV (Houston, TX) ...... 13 (2) 10
WTVD (Durham-Raleigh, NC) .. 11 Dec. 1, 1996 32
KFSN-TV (Fresno, CA) ....... 30 (2) 57
[Download Table]
Radio stations
Frequency Expiration Radio
Station AM-Kilohertz date of FCC market
and market FM-Megahertz authorization ranking(4)
---------------------------- ------------ -------------- -------------------
WABC (New York, NY) ........ 770 K June 1, 1998 1
KABC (Los Angeles, CA) ..... 790 K (2) 2
WLS (Chicago, IL) .......... 890 K Dec. 1, 1996 3
KGO (San Francisco, CA) .... 810 K Dec. 1, 1997 4
WJR (Detroit, MI) .......... 760 K Oct. 1, 1996 6
WMAL (Washington, DC) ...... 630 K Oct. 1, 1995 7
WBAP (Fort Worth-Dallas, TX) 820 K Aug. 1, 1997 8
WKHX (Atlanta, GA) (3) ..... 590 K Apr. 1, 1996 12
KQRS (Minneapolis-St.Paul,
MN) ....................... 1440 K Apr. 1, 1997 17
WPLJ(FM) (New York, NY) .... 95.5 M June 1, 1998 1
KLOS(FM) (Los Angeles, CA) . 95.5 M (2) 2
WLS-FM (Chicago, IL) ....... 94.7 M Dec. 1, 1996 3
WHYT(FM) (Detroit, MI) ..... 96.3 M Oct. 1, 1996 6
WRQX(FM) (Washington, DC) .. 107.3 M Oct. 1, 1995 7
KSCS(FM) (Fort Worth-Dallas,
TX) (3) ................... 96.3 M Aug. 1, 1997 8
WKHX-FM (Atlanta, GA) (3) .. 101.5 M Apr. 1, 1996 12
WYAY(FM) (Atlanta, GA) (3) . 106.7 M Apr. 1, 1996 12
KQRS-FM (Minneapolis-St.
Paul, MN) ................. 92.5 M Apr. 1, 1997 17
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(1) Based on Nielsen U.S. Television Household Estimates, 1993-1994 season.
(2) See "Licenses -- Federal Regulation of Broadcasting/Renewal Matters" below
for description of pending license renewal applications and other matters.
(3) No ABC network affiliation.
(4) Based on Arbitron Radio Market Survey Schedule and Population Rankings
(metro survey area) as of Fall 1993.
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Cable and International Broadcast
The Company's Cable and International Broadcast operations are principally
involved in the production and distribution of cable television programming, in
the licensing of programming to domestic and international markets and in joint
ventures in foreign-based television operations and television production and
distribution entities. Its primary services are:
ESPN, an 80%-owned cable sports programming service reaching 62,700,000
households domestically and 49,000,000 households in 90 countries
internationally; ESPN2 reaching 13,000,000 households. ESPN also owns 33% of
Eurosport, a pan-European satellite-delivered cable and direct-to-home sports
programming service reaching 48,700,000 households; and 20% of Japan Sports
Network reaching 910,000 households;
Arts & Entertainment Network, a 37 1/2%-owned cable programming service
devoted to cultural and entertainment programming and reaching 52,900,000
households;
Lifetime, a 33 1/3%-owned cable programming service devoted to women's
lifestyle programming and reaching 58,800,000 households;
Tele-Munchen Fernseh GmbH & Co., a 50%-owned Munich, Germany based television
and theatrical production/distribution company with interests in cinemas and a
minority interest in a Munich radio station;
RTL 2 Fernsehen GmbH & Co., a 20%-owned Cologne, Germany based general
entertainment commercial broadcasting company reaching 19,600,000 households;
Scandinavian Broadcasting System SA, a 24%-owned Luxembourg based company
operating television stations in Denmark reaching 1,300,000 households, and
satellite-delivered cable and direct-to-home general entertainment television
programming services in Sweden and Norway reaching 1,700,000 and 900,000
households, respectively;
Hamster Productions, S.A., 33 1/3%-owned, and Tesauro, S.A., 25%-owned,
television and theatrical production/distribution companies based in Paris,
France and Madrid, Spain, respectively; and
DIC Productions, L.P., a 95%-owned production/distribution venture of animated
and live action programming for the children's television and video markets,
and DIC Entertainment, L.P., a 100%-owned film library of similar type
programming.
Multimedia
In late 1993, the Company created a Multimedia Group with the mandate to explore
using video and print material to create new programming and software and to
explore investment opportunities in emerging multimedia and interactive
technologies. The division includes the Capital Cities/ABC Video Publishing
unit, which acquires rights to and produces programming for the home video
market.
Competition
The ABC Television Network competes for viewers with the other television
networks, independent television stations and other video media such as cable
television, multipoint distribution services ("MDS," which employ non-broadcast
frequencies to transmit subscription television services to individual homes and
businesses), satellite television program services and video cassettes; in the
sale of advertising time, it competes with the other television networks,
independent television stations, suppliers of cable television programs, and
other advertising media such as newspapers, magazines and billboards.
Substantial competition also exists for exclusive broadcasting rights for
television programming. The ABC Radio Networks likewise compete with other radio
networks and radio programming services, independent radio stations, and other
advertising media.
The Company's television and radio stations are in competition with other
television and radio stations, cable television systems, MDS, satellite
television program services, video cassettes and other advertising media such as
newspapers, magazines and billboards. Such competition occurs primarily in
individual market areas. Generally, a television station in one market does not
compete directly with
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other stations in other market areas. Nor does a group of stations, such as
those owned by the Company, compete with any other group of stations as such.
While the pattern of competition in the radio station industry is basically the
same, it is not uncommon for radio stations outside of a market area to place a
signal of sufficient strength within that area (particularly during nighttime
hours) to gain a share of the audience. However, they generally do not realize
significantly increased advertising revenues as a result.
The Company's Cable and International Broadcast operations compete with a number
of companies involved in developing and supplying program services for cable,
television syndication and theatrical distribution, and with conventional
television broadcasters. The Multimedia operations face competition from
numerous broadcast, cable, computer software, production and distribution
companies which are also pursuing opportunities in the new technologies. The
development of these businesses could adversely affect the future of
conventional television broadcasting.
In addition, the Company's broadcast operations face potential competition from
numerous new satellite, cable and telephone technologies and distribution
systems, and from signal-enhancing technologies such as high definition
television or, in radio, "digital audio" radio. Although most of these
technologies are in experimental phases, all have the potential to further
increase the entertainment and information alternatives available to consumers.
In some instances, the Company may itself participate in these new technologies.
Regulatory, technical and economic issues make it impossible to predict whether
or when, such technologies will become viable or competitive.
Licenses--Federal Regulation of Broadcasting
Television and radio broadcasting are subject to the jurisdiction of the FCC
under the Communications Act of 1934, as amended (the "Communications Act"). The
Communications Act empowers the FCC, among other things, to issue, revoke or
modify broadcasting licenses, determine the location of stations, regulate the
equipment used by stations, adopt such regulations as may be necessary to carry
out the provisions of the Communications Act and impose certain penalties for
violation of its regulations.
Renewal Matters
Broadcasting licenses are granted for a maximum period of seven years, in the
case of radio stations, and five years, in the case of television stations, and
are renewable upon application therefor. During certain periods when a renewal
application is pending, new applicants may file for the frequency and may be
entitled to compete with the renewal applicant in a comparative hearing, and
others may file petitions to deny the application for renewal of license.
Renewal applications are now pending for KABC(AM), KLOS-FM, KTRK-TV, KABC-TV,
KGO-TV and KFSN-TV. In the case of KABC(AM), KLOS-FM, KABC-TV, KGO-TV and KFSN-
TV, the time to file competing applications and petitions to deny has passed,
and no such filings have been made against these stations. In the case of KTRK-
TV, two petitions to deny have been filed. The Company believes both petitions
are without merit and is vigorously opposing them. All of the Company's other
owned stations have been granted license renewals by the FCC for regular terms.
On April 15, 1992, the U.S. District Court for the District of Columbia issued a
Memorandum Opinion and Order in Shepherd et al. v. American Broadcasting
Companies, Inc. et al., Civil Action No. 88-0954 (RCL), which entered a default
judgment against American Broadcasting Companies, Inc. and the Company on a
complaint alleging discrimination in employment practices at the ABC News Bureau
in Washington, DC, in violation of District of Columbia law. The default was
based on a conclusion that "the defendants impeded and obstructed the litigation
process by . . . destruction and alteration of a crucial document and through
the harassment of witnesses and filing false and misleading affidavits." On
September 3, 1993, the District Court issued a Memorandum Opinion on
reconsideration that withdrew many of the findings of misconduct previously made
but reaffirmed other such findings (as well as the default judgment) and called
for further proceedings with respect to damages.
The Company believes that the District Court's decision is factually and legally
incorrect, and it is seeking to obtain a review of the default judgment (and the
supporting findings of misconduct that remain) by the U.S. Court of Appeals for
the District of Columbia Circuit. However, the policies of the FCC call for the
agency to evaluate whether an adjudication of misconduct of the kind found in
Shepherd should bear on the qualifications of the licensee, even though the
adjudication is pending
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on appeal. The FCC has recently approved the Company's acquisition of radio
station WYAY(FM), Gainesville, GA without prejudice to any action the agency may
take in light of the ultimate outcome of the Shepherd decision. On January 14,
1994, the Company submitted to the FCC amendments to its pending license renewal
applications urging that it and its subsidiaries should be found fully qualified
to hold broadcast licenses, even if the misconduct findings of the District
Court were ultimately upheld. Pending FCC action on that issue the Company will
urge thc FCC to apply the Gainesville, GA precedent to permit the acquisition of
new stations, the sale of existing stations or the renewal of existing licenses.
Ownership Matters
The Communications Act prohibits the assignment of a license or the transfer of
control of a licensee without prior approval of the FCC, and prohibits the
Company from having any officer or director who is an alien, and from having
more than one-fifth of its shares owned of record or voted by aliens,
representatives of aliens, foreign governments, representatives of foreign
governments or corporations organized under the laws of foreign countries.
The FCC's "multiple ownership" rules impose a variety of restrictions on the
ownership or control of broadcast stations by a single party. The television
"duopoly" rule bars control or ownership of significant interests in two
television stations that serve the same area. Less severe restraints are
imposed on the control or ownership of AM and FM radio stations that serve the
same area; in a number of situations, a single party may control or own an AM
and/or an FM "duopoly" -- two AM and/or two FM stations -- in the same market
area. The rules also preclude the grant of applications for station
acquisitions that would result in the creation of new radio-television
combinations in the same market under common ownership, or the sale of such a
combination to a single party, subject to the availability of waiver. Under FCC
policy, waiver applications that involve radio-television station combinations
in the top 25 TV markets where there would be at least 30 separately owned,
operated and controlled broadcast licensees after the proposed combination will
generally be favorably received. Under present FCC rules, a single entity may
directly or indirectly own, operate or have a significant interest in up to
eighteen AM and eighteen FM radio stations, and up to twelve television stations
(VHF or UHF), provided that those television stations operate in markets
containing cumulatively no more than 25% of the television households in the
country. For this purpose, ownership of a UHF station will result in the
attribution of only 50% of the television households in the relevant market.
The Company owns eight television stations, of which seven are VHF, resulting in
a total penetration of the nation's television households, for purposes of the
multiple ownership rules, of 23.63%. The Company also owns nine AM and nine FM
radio stations.
Furthermore, under the FCC's rules, radio and/or television licensees may not
acquire new ownership interests in daily newspapers published in the same
markets served by their broadcast stations. The Company currently owns daily
newspapers in two markets in which it also holds radio licenses. For purposes
of these rules, The Oakland Press and WJR(AM) and WHYT(FM), licensed to Detroit,
are treated as in the same market, as are the Fort Worth Star-Telegram and
WBAP(AM) and KSCS(FM), licensed to Fort Worth. Absent an FCC waiver, the
Company could not under the rules acquire additional broadcast stations in these
markets nor could the current broadcast/newspaper combinations be transferred
together. In 1993, the Congress relaxed a restriction previously imposed on the
FCC so as to allow the FCC to grant waivers of the rules with respect to
newspaper/radio station cross-ownership in the top 25 markets where at least 30
independent broadcast voices would remain following a transfer if the FCC
determines that a waiver would serve the public interest. This new policy
creates potential new acquisition opportunities for the Company.
The FCC's rules also provide that television licensees may not own cable
television systems in communities within the service contours of their
television stations. In 1992, the FCC relaxed the rule that previously
prohibited common ownership of television networks and cable television systems
to permit such combinations subject to a national limit of 10% of "homes passed"
(i.e., homes within the service areas of cable systems) by cable as well as a
local limit of 50% of homes passed within any ADI (Area of Dominant Influence,
i.e., local television market area as defined by Arbitron Television Ratings).
The FCC's rules generally provide that an entity will have the licensee's
broadcast stations or newspapers attributed to it for purposes of the multiple
ownership rules only if it holds the power to vote or control the vote of 5% or
more of the stock of a licensee. Qualifying mutual funds, insurance
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companies, or bank trust departments may vote or control the vote of up to 10%
of the stock of a broadcast licensee before the licensee's stations would be
attributed to that entity.
Network Regulations
In May 1993, the FCC eliminated rules that previously restricted the ability of
the Company as well as CBS Inc. ("CBS") and National Broadcasting Company, Inc.
("NBC") to acquire financial interests in network television programs. In the
same proceeding, the FCC retained (subject to a complex two-year sunset
provision) rules that prevent the networks from engaging in active first-run or
"off-network" syndication of programs to television stations in the United
States, constrain the networks' discretion to determine when programs owned by
them will be made available for syndication, and prevent the networks from
acquiring from independent producers interests in first-run syndicated programs.
In September 1993, the FCC substantially denied petitions for reconsideration of
its May 1993 decision. The lawfulness of the regulations the agency has
retained, and of the 1993 modications, has been challenged in proceedings
currently pending in the United States Court of Appeals for the Seventh Circuit.
The Company is not able to predict the outcome of these proceedings. In
addition, other FCC rules effectively restrict the regular prime-time
programming schedules of ABC, CBS and NBC to three hours per night during the
period 7:00 P.M. to 11:00 P.M. on Monday through Saturday.
The Company's television network operations are subject to a consent judgment
(United States v. American Broadcasting Companies, Inc., 74-3600-RJK), in the
United States District Court for the Central District of California, entered
into and effective on November 14, 1980. Similar judgments have been entered
against CBS and NBC with respect to their television networks. In November 1993
the United States District Court, upon a joint motion by the United States
Department of Justice, the Company, CBS and NBC, modified the consent judgment
to eliminate those provisions which prohibited the acquisition of subsidiary
rights and interests in television programs produced by independent suppliers
and restricted the ability of the Company (as well as CBS and NBC) to engage in
the business of distributing programs directly to television stations in the
United States or overseas. The consent judgment continues to contain provisions
regulating for a period expiring in 1995 certain aspects of the Company's
contractual relationships with suppliers of entertainment programming and with
talent performers and other creative contributors to ABC Television Network
entertainment programming.
Cable Television and Other Competing Services
Cable television can provide more competition to a television station by making
additional signals available to the audience. In 1992, Congress enacted the
Cable Television Consumer Protection and Competition Act. The Act gives
television stations the right to elect "must carry" protection (including
protection on channel position) on local cable systems. (The FCC's "must
carry" rules require cable television systems generally to carry the signals of
television stations in whose service areas they operate.) In the alternative,
the Act permits local stations to negotiate with cable systems the terms and
conditions of "retransmission consent" to carry their signals and to withhold
their signals in the event that no consent on terms and conditions is reached.
The Act also reimposes cable system rate regulation and introduces new
regulations designed to ensure that MDS and other multi-channel video
programmers have access to programming to facilitate competition with cable
systems. The Act requires the FCC to conduct rulemaking proceedings to
establish national cable system ownership limits and limits on cable channels
devoted to video programmers in which the cable system has an interest, and to
prohibit coercive or discriminatory practices by cable operators in dealings
with video programmers (such as ESPN, ESPN2, Arts & Entertainment and Lifetime).
The FCC has adopted regulations implementing all of these statutory provisions.
Cable operators have filed lawsuits challenging many of the new Act's
provisions. The must carry, retransmission consent, rate regulation and program
access provisions have been upheld as constitutional in federal court decisions.
The decision relating to must carry is pending on appeal in the Supreme Court of
the United States. The decision relating to the Act's other provisions has been
appealed to the United States Court of Appeals for the District of Columbia
Circuit. The Company cannot predict the outcome of this litigation.
Most cable television systems supply additional programming to subscribers that
is not originated on, or transmitted from, conventional television broadcasting
stations. Many of these services
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(including ESPN, ESPN2, Arts & Entertainment and Lifetime) are also being
distributed directly to viewers by means of satellite transmissions to home
satellite reception dishes.
The FCC also authorizes broadcast subscription television services and MDS, and
has expanded the number of frequencies available for MDS by allocating two
groups of four channels each for the so-called multichannel MDS, to be awarded
by lottery. The FCC has authorized licensees in the Instructional Television
Fixed Service to lease their excess capacity for commercial use, including
subscription television service, and has adopted rules facilitating direct
broadcast satellite operations. It has also created a new service of low power
television facilities to supplement existing conventional television broadcast
service.
The Company also faces potential competition to its broadcast and cable program
services and to its newspaper operations from telephone companies. Telephone
companies are seeking to expand their broadband networks to provide both data
transmission services ("electronic publishing") and video services to the home.
Until 1991, the regional Bell operating companies were prohibited from providing
information services by the Modified Final Judgment that governed the break-up
of American Telephone and Telegraph Company. While that prohibition has been
lifted, there is a provision in the Cable Act of 1984 that prohibits telephone
companies from providing video programming directly to their telephone
subscribers ("the telco/cable cross ownership ban"). A number of recent
developments may affect potential telephone company competition. First, the FCC
decided in 1991 and 1992 to permit telephone companies to offer "video dialtone"
distribution services to programmers on a common carrier basis without having to
obtain a municipal cable franchise. Appeals challenging this decision are
pending in the United States Court of Appeals for the District of Columbia
Circuit. Second, in a suit filed by Bell Atlantic Corporation, a U.S. District
Court ruled in August 1993 that the telco/cable cross ownership ban is
unconstitutional. The decision has been appealed to the United States Court of
Appeals for the Fourth Circuit. Finally, there are a number of legislative
proposals that would either eliminate or modify the telco/cable cross ownership
ban. The Company cannot predict the outcome of these developments or the
competitive effect of these services or potential services.
From time to time legislation may be introduced in Congress which, if enacted,
might affect the Company's operations or its advertising revenues. Proceedings,
investigations, hearings and studies are periodically conducted by Congressional
committees and by the FCC and other government agencies with respect to problems
and practices of, and conditions in, the broadcasting industry. The Company
cannot generally predict whether new legislation or regulations may result from
any such studies or hearings or the adverse impact, if any, upon the Company's
operations which might result therefrom.
The information contained under this heading does not purport to be a complete
summary of all the provisions of the Communications Act and the rules and
regulations of the FCC thereunder, or of pending proposals for other regulation
of broadcasting and related activities. For a complete statement of such
provisions, reference is made to the Communications Act, and to such rules,
regulations and pending proposals thereunder.
* * * * *
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Publishing
The Company publishes newspapers and shopping guides, various specialized and
business periodicals and books; provides research services and also distributes
information from data bases. Following is a summary of the Company's historical
operating performance, by type of publication, for the last five years (000's
omitted):
[Enlarge/Download Table]
Pro Forma (b)
---------------
1993 1992 1991 1990 1989 1993 1992
---- ---- ---- ---- ---- ---- ----
Inches of advertising
Newspapers (a).............. 18,953 18,396 17,550 18,421 15,844 18,953 18,396
Specialized publications.... 3,055 3,004 2,921 3,399 3,603 2,878 2,920
Advertising revenue
Newspapers--ROP............. $310,429 $301,182 $291,592 $307,634 $290,545 $310,429 $301,182
Newspapers--inserts......... 58,732 55,278 51,695 49,800 44,694 58,732 55,252
Shopping guides............. 71,853 71,137 66,370 65,834 62,111 70,633 70,232
Specialized publications.... 277,077 270,885 267,974 307,686 310,169 265,243 259,209
Circulation revenue
Newspapers.................. $101,112 $ 96,226 $ 93,697 $ 85,933 $ 82,582 $101,112 $ 96,226
Specialized publications.... 51,182 47,253 53,024 59,471 65,882 45,800 45,016
Other operating revenue
Newspapers.................. $21,700 $ 18,200 $ 14,323 $ 10,813 $ 6,635 $ 18,540 $ 16,667
Shopping guides............. 4,851 4,220 3,589 4,171 4,337 4,663 4,220
Specialized publications
Books/Music............... 28,638 118,967 116,708 111,643 108,012 28,638 30,817
Research services,
data base and other...... 84,864 95,218 93,274 98,984 82,438 83,331 77,476
Total revenue
Newspapers.................. $491,973 $470,886 $451,307 $454,180 $424,456 $488,813 $469,327
Shopping guides............. 76,704 75,357 69,959 70,005 66,448 75,296 74,452
Specialized publications.... 441,761 532,323 530,980 577,784 566,501 423,012 412,518
Paid circulation at year-end
Newspapers (Daily).......... 751 754 741 769 891 751 754
Newspapers (Sun.)........... 1,008 992 966 958 930 1,008 992
Specialized publications.... 1,324 1,356 1,768 2,164 3,256 1,212 1,347
----------
(a) Does not include inserts.
(b) Excludes 1993 and 1992 acquisitions, start-ups and disposals.
K-9
Daily Newspapers
The Company publishes eight daily newspapers in eight communities (six of
which have Sunday editions). The daily newspapers and their paid circulation are
as follows:
[Download Table]
Daily Sunday
----- ------
The Kansas City Star....................... Morning 297,000 431,000
Fort Worth Star-Telegram................... All Day 252,000 347,000
The Oakland Press (Pontiac, MI)............ Morning 70,000 81,000
Belleville News-Democrat (Belleville, IL).. Morning 51,000 61,000
The Times Leader (Wilkes-Barre, PA)........ Morning 47,000 79,000
Albany Democrat-Herald (Albany, OR)........ Evening 21,000
Milford Citizen (Milford, CT).............. Evening 7,000 9,000
The Daily Tidings (Ashland, OR)............ Evening 6,000
Weekly Newspapers
The Company publishes weekly community newspapers in seven states. The
location by state, number of publications and aggregate circulation is set forth
below:
[Download Table]
Number of Aggregate
State Publications Circulation
----- ------------ -----------
Connecticut................................ 26 147,000
Illinois................................... 13 55,000
Massachusetts.............................. 16 53,000
Michigan................................... 12 187,000
Oregon..................................... 6 39,000
Pennsylvania............................... 1 11,000
Rhode Island............................... 4 22,000
Shopping Guides and Real Estate Magazines
The Company distributes shopping guides and real estate magazines in
thirteen states. The location by state, number of publications and aggregate
circulation is set forth below:
[Download Table]
Number of Aggregate
State Publications Circulation
----- ------------ -----------
California................................. 6 1,956,000
Connecticut................................ 9 208,000
Illinois................................... 1 14,000
Kansas..................................... 1 144,000
Massachusetts.............................. 19 232,000
Michigan................................... 7 94,000
Missouri................................... 1 135,000
Nevada..................................... 4 114,000
Oregon..................................... 5 207,000
Pennsylvania............................... 3 89,000
Rhode Island............................... 1 23,000
Texas...................................... 2 57,000
Washington................................. 4 387,000
K-10
Specialized Publications
The Specialized Publications consists of three groups: the Diversified
Publishing Group, the Fairchild Publications Group, and the Financial Services
and Medical Group. Through these groups it is engaged in gathering and
publishing business news and ideas for industries covered by its various
publications; in the publishing of consumer, special interest, trade and
agricultural publications; and in research and data base services. All of the
publications are printed by outside printing contractors. Following are the
significant publications and services:
[Enlarge/Download Table]
Title Frequency Circulation
----- --------- -----------
Diversified Publishing Group
Agricultural Publishing Group
Farm Futures....................................... 10 times per year 225,000*
Feedstuffs......................................... Weekly 17,000
Tack 'n Togs Merchandising......................... 13 times per year 23,000*
In addition, the Agricultural Publishing Group publishes nineteen state and
regional farm magazines with an aggregate circulation of 947,000, serving 35
states.
Chilton Publications
American Metal Market.............................. Daily 10,000
Assembly........................................... 9 times per year 60,000*
Automotive Body Repair News........................ Monthly 60,000*
Automotive Industries.............................. Monthly 100,000*
Automotive Marketing............................... Monthly 40,000*
Cablevision........................................ Semimonthly 14,000*
CED (Communications Engineering and Design)........ Monthly 15,000*
Commercial Carrier Journal......................... Monthly 85,000*
Distribution....................................... Monthly 70,000*
Electronic Component News.......................... Monthly 121,000*
Energy User News................................... Monthly 40,000*
Food Engineering................................... Monthly 60,000*
Food Engineering International..................... 6 times per year 15,000*
Hardware Age....................................... Monthly 69,000*
I&CS (Instrument & Control Systems)................ Monthly 93,000*
IAN (Instrumentation & Automation News)............ Monthly 117,000*
IMPO (Industrial Maintenance & Plant Operations)... Monthly 127,000*
Industrial Paint & Powder.......................... Monthly 37,000*
Industrial Safety & Hygiene News................... Monthly 60,000*
Jewelers' Circular-Keystone........................ Monthly 29,000
Manufacturing Systems.............................. Monthly 115,000*
Metal Center News.................................. Monthly 15,000*
Motor Age.......................................... Monthly 134,000*
Multichannel News.................................. Weekly 15,000
New Steel.......................................... Monthly 18,000*
Outdoor Power Equipment............................ Monthly 22,000*
Owner Operator..................................... 9 times per year 93,000*
PIQ (Process Industries Quality)................... 6 times per year 42,000*
Product Design and Development..................... Monthly 161,000*
K-11
[Enlarge/Download Table]
Title Frequency Circulation
----- --------- -----------
Product Design and Development Europe.............. 4 times per year 50,000*
Quality............................................ Monthly 97,000*
Review of Optometry................................ Monthly 32,000*
Video Business..................................... Weekly 45,000*
Video Software Magazine............................ Monthly 22,000*
Warehousing........................................ 6 times per year 40,000*
Los Angeles.......................................... Monthly 156,000
The Diversified Publishing Group also includes: Chilton Enterprises which
publishes automotive repair, craft and hobby books, provides custom market
research and conducts trade shows; NILS Publishing Company, a data base
publisher of information on insurance laws and regulations; and Grupo
Editorial Expansion, S.A., acquired in 1993, which publishes Expansion, a
biweekly business magazine with a circulation of 29,000; Obras, a monthly
construction magazine with a circulation of 11,000; and various bulletins and
newsletters concerning Mexican business and legal issues.
Fairchild Publications Group
Children's Business................................ Monthly 13,000*
Daily News Record.................................. Daily 20,000
Footwear News...................................... Weekly 19,000
Golf Pro Merchandiser.............................. 8 times per year 12,000*
HFD--The Weekly Home Furnishings Newspaper......... Weekly 28,000
Home Fashions Magazine............................. 11 times per year 10,000*
Salon News......................................... Monthly 80,000*
SportStyle......................................... 18 times per year 25,000*
Supermarket News................................... Weekly 51,000
W.................................................. Monthly 258,000
W Fashion Europe................................... 10 times per year 20,000
Women's Wear Daily................................. Daily 55,000
Financial Services and Medical Group
Institutional Investor
Domestic Edition................................... Monthly 105,000*
International Edition.............................. Monthly 39,000*
Infrastructure Finance............................. Quarterly 17,000*
Selling............................................ 10 times per year 70,000
International Medical News Group
Clinical Psychiatry News........................... Monthly 33,000*
Family Practice News............................... Semimonthly 72,000*
Internal Medicine News............................. Semimonthly 101,000*
Ob. Gyn. News...................................... Semimonthly 32,000*
Pediatric News..................................... Monthly 36,000*
Skin & Allergy News................................ Monthly 18,000*
----------
*All, or substantially all, controlled circulation.
Certain operations within the Publishing Group also publish philatelic
magazines, cable guides, books, visuals, journals and newsletters, and conduct
meetings and seminars.
K-12
Competition
The Company's newspapers, specialized publications and shopping guides operate
in a highly competitive environment. In the Company's various news publishing
activities it competes with almost all other information media, including
broadcast media, and this competition may become more intense as new
technologies are developed. Magazines and many newspapers publish substantial
amounts of similar business news and information, and deal with the same or
related special interests or industries, as those covered by the Company's
specialized publications. The Company's newspapers, specialized publications
and shopping guides compete for advertising with all other advertising forms of
media.
Raw Materials
The primary raw materials used by the Company's Publishing Group are newsprint
and other paper stock, which are purchased from paper merchants, paper mills and
contract printers and are readily available from numerous suppliers.
Item 2. Properties.
The Company's headquarters building at 77 West 66th Street in New York City
houses the corporate offices and the television network administrative staff,
and is owned by the Company.
The Company owns the ABC Television Center adjacent to the Company's
headquarters building on West 66th Street and the ABC Radio Networks' studios at
125 West End Avenue in New York City. In Los Angeles, the Company owns the ABC
Television Center. The Company leases the ABC Television Network offices in Los
Angeles, the ABC News Bureau facility in Washington, DC and the computer
facility in Hackensack, NJ under leases expiring on various dates through 2034.
The Company's broadcast operations and engineering facility and local television
studios and offices in New York City are leased, but the Company has the right
to acquire such properties for a nominal sum in 1997. The Company's 80%-owned
subsidiary ESPN owns ESPN Plaza in Bristol, CT from which it conducts its
technical operations. The Company owns the majority of its other broadcast
studios and offices and broadcast transmitter sites elsewhere, and those which
it does not own are occupied under leases expiring on various dates through
2039.
The Company owns and leases publishing subsidiaries' executive, editorial and
other offices and facilities in various cities. For leased properties, the
leases expire on various dates through 2006. All of the significant premises
occupied by the newspapers are owned by the Company.
Item 3. Legal Proceedings.
All litigation pending during 1993 was routine and incidental to the business of
the Company. For a discussion of the relevance of one item of litigation in the
regulatory context, see "Licenses - Federal Regulation of Broadcasting" under
Item 1. Business.
Item 4. Submission of Matters to a Vote of Security Holders.
The information called for by this item is not applicable.
K-13
Executive Officers of the Company
[Enlarge/Download Table]
Director Officer Title and positions during
Name Age since since the past five years
---- --- -------- ------ --------------------------
Thomas S. Murphy 68 1957 1958 Chairman of the Board of Directors and Chief Executive Officer. From June
1990 to February 1994 he was Chairman of the Board of Directors. Prior to
June 1990 he was Chairman of the Board of Directors and Chief Executive
Officer.
John B. Fairchild 67 1968 1968 Executive Vice President, Chairman of Fairchild Publications Group and
Director.
Robert A. Iger 43 1993 Executive Vice President (Senior Vice President from March 1993 to August
1993), and President of ABC Television Network Group. Prior to January 1993
he was President of ABC Entertainment since 1989. In 1988 and 1989 he was
Executive Vice President of ABC Television Network Group. Prior thereto he
was Vice President, Program Planning and Acquisition for ABC Sports.
Ronald J. Doerfler 52 1977 Senior Vice President and Chief Financial Officer.
Herbert A. Granath 65 1988 Senior Vice President, and President Cable and International Broadcast
Group. Prior to October 1993 he was Vice President, and President of Video
Enterprises.
Michael P. Mallardi 60 1986 Senior Vice President, and President of Broadcast Group.
Phillip J. Meek 56 1975 Senior Vice President, and President of Publishing Group.
Stephen A. Weiswasser 53 1986 Senior Vice President and General Counsel, and President of Multimedia
Group. From January 1993 to August 1993 he was Senior Vice President.
Prior to January 1993 he was Senior Vice President, and Executive Vice
President of ABC News. In 1991 he was Senior Vice President, and Executive
Vice President of ABC Television Network Group. Prior thereto he was Senior
Vice President and General Counsel.
David Westin 41 1991 Senior Vice President, and President of Production, ABC Television Network
Group. From March 1993 to August 1993 he was Senior Vice President and
General Counsel. From 1991 to March 1993 he was Vice President and General
Counsel. Prior to 1991 he was engaged in the practice of law as a partner in
the law firm of Wilmer,Cutler & Pickering.
Alan N. Braverman 46 1993 Vice President and Deputy General Counsel. Prior to November 1993 he was
engaged in the practice of law as a partner in the law firm of Wilmer,
Cutler & Pickering.
Allan J. Edelson 51 1981 Vice President and Controller.
David J. Vondrak 48 1986 Vice President and Treasurer.
There is no relationship by blood, marriage or adoption among the officers. All
officers hold office at the pleasure of the Board of Directors.
K-14
PART II
Item 5. Market for the Registrant's Common Stock and Related Security Holder
Matters.
The information called for by this item is included on page 41 of the 1993
Annual Report to Shareholders and is incorporated herein by reference.
Item 6. Selected Financial Data.
The information called for by this item is included on pages 26 and 27 of the
1993 Annual Report to Shareholders and is incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
The information called for by this item is included on pages 21 through 25 of
the 1993 Annual Report to Shareholders and is incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data.
The information called for by this item is included on pages 28 through 41 of
the 1993 Annual Report to Shareholders and is incorporated herein by reference.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
The information called for by this item is not applicable.
PART III
Item 10. Directors and Executive Officers of the Registrant.
Incorporated herein by reference to the Company's definitive Proxy Statement for
the annual meeting of shareholders to be held on May 19, 1994. Information
concerning the executive officers is included in Part 1, on page K-14.
Item 11. Executive Compensation.
Incorporated herein by reference to the Company's definitive Proxy Statement for
the annual meeting of shareholders to be held on May 19, 1994.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Incorporated herein by reference to the Company's definitive Proxy Statement for
the annual meeting of shareholders to be held on May 19, 1994.
Item 13. Certain Relationships and Related Transactions.
The information called for by this item is not applicable.
K-15
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.
(a) 1. & 2. Financial statements and financial statement schedules.
The financial statements and schedules listed in the accompanying index
to the consolidated financial statements are filed as part of this annual
report.
3. Exhibits.
The exhibits listed on the accompanying index to exhibits are filed as
part of this annual report.
(b) Reports on Form 8-K.
None filed during Fourth Quarter 1993.
K-16
CAPITAL CITIES/ABC,INC.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULES
COVERED BY REPORT OF CERTIFIED PUBLIC ACCOUNTANTS
(Item 14(a) 1. & 2.)
[Download Table]
Reference
------------------------
Annual Report
to
Shareholders Form 10-K
------------ ---------
Consolidated balance sheet at December 31, 1993 and
December 31, 1992................................... 30
For the years ended December 31, 1993, 1992 and 1991
Consolidated statement of income.................... 28
Consolidated statement of cash flows................ 29
Consolidated statement of stockholders' equity...... 32
Notes to consolidated financial statements............ 33
Financial statement schedules for the years ended
December 31, 1993, 1992 and 1991
V --Property, plant and equipment................ K-20
VI --Accumulated depreciation and amortization of
property, plant and equipment............... K-21
VIII --Valuation and qualifying accounts............ K-20
X --Supplementary income statement information... K-21
All other schedules have been omitted since the required information is not
applicable or is not present in amounts sufficient to require submission of the
schedule, or because the information required is included in the consolidated
financial statements, including the notes thereto.
* * * * *
The consolidated financial statements of Capital Cities/ABC, Inc., listed in
the above index which are included in the Annual Report to Shareholders for the
year ended December 31, 1993, are hereby incorporated by reference. With the
exception of the Items referred to in Items 1, 5, 6, 7 and 8, the 1993 Annual
Report to Shareholders is not to be deemed filed as part of this report.
--------------------------------------------------------------------------------
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Annual Report on Form
10-K of Capital Cities/ABC, Inc. for the year ended December 31, 1993 of our
report dated February 28, 1994, included in the 1993 Annual Report to
Shareholders of Capital Cities/ABC, Inc.
Our audits also included the financial statement schedules of Capital
Cities/ABC, Inc. listed in item 14(a). These schedules are the responsibility
of the Company's management. Our responsibility is to express an opinion based
on our audits. In our opinion, the financial statement schedules referred to
above, when considered in relation to the basic financial statements taken as a
whole, present fairly in all material respects the information set forth
therein.
We also consent to the incorporation by reference in the Registration
Statements Form S-8 No. 2-59014 for the registration of 287,195 shares of the
Company's common stock, Form S-8 No. 2-86863 for the registration of 300,000
shares, Form S-8 No. 33-2196 relating to the issuance of an indeterminate number
of shares, Form S-8 No. 33-11806 for the registration of 200,000 shares, Form
S-8 No. 33-16206 for the registration of 300,000 shares, Form S-8 No. 33-25918
for the registration of 200,000 shares, Form S-8 No. 33-33761 for the
registration of 200,000 shares, Form S-3 No. 33-38117 for the registration of
Debt Securities and Warrants to purchase Debt Securities, Form S-3 No. 33-39652
for the registration of Debt Securities and Warrants to purchase Debt
Securities, and Form S-8 No. 33-52563 for the registration of 60,000 shares, and
in the related Prospectuses and documents constituting Prospectuses, of our
above report.
ERNST & YOUNG
New York, New York
March 14, 1994
K-17
CAPITAL CITIES/ABC, INC.
INDEX TO EXHIBITS (Item 14 (a) 3.)
(3)(a) Restated Certificate of Incorporation of the Company, with amendments.
Incorporated by reference to Exhibit (3)(a) to the Company's Annual Report on
Form 10-K for 1989.
(3)(b) Current By-laws of the Company. Incorporated by reference to Exhibit
(3) to the Company's Quarterly Report on Form 10-Q for the period ended
September 30, 1990.
(4)(a) Capital Cities/ABC, Inc. Standard Multiple-Series Indenture Provisions
dated December 7, 1990. Incorporated by reference to Exhibit (4)(a) to
Registration Statement No. 33-38117.
(4)(b) Indenture, dated as of December 15, 1990, between the Company and
Manufacturers Hanover Trust Company (now Chemical Bank), as Trustee, with
respect to Senior Debt Securities. Incorporated by reference to Exhibit (4)(b)
to Registration Statement No. 33-38117.
(4)(c) Indenture, dated as of April 1, 1991 between the Company and
Manufacturers Hanover Trust Company (now Chemical Bank), as Trustee, with
respect to Subordinated Debt Securities. Incorporated by reference to Exhibit
(4)(c) to Registration Statement No. 33-39652.
(4)(d) Revolving Credit Agreement, dated as of January 3, 1986, as amended and
restated as of June 30, 1987, among the Company, Chemical Bank and certain other
banks. Incorporated by reference to Exhibit (4)(d) to the Company's Annual
Report on Form 10-K for 1987.
(4)(e) Second Amendment, dated as of June 30, 1989, to the Revolving Credit
Agreement set forth in Exhibit (4)(d) above. Incorporated by reference to
Exhibit 4(e) to the Company's Annual Report on Form 10-K for 1989.
(4)(f) Third Amendment, dated as of April 30, 1992, to the Revolving Credit
Agreement set forth in Exhibits (4)(d) and (4)(e) above. Incorporated by
reference to Exhibit 4(f) to the Company's Annual Report on Form 10-K for 1992.
(4)(g) Other instruments defining the rights of holders of long-term debt of
the Company and its consolidated subsidiaries are not being filed since the
total amount of securities authorized under any of such instruments does not
exceed 10 percent of the total assets of the Company and its subsidiaries on a
consolidated basis. The Company agrees to furnish a copy of any such instrument
to the Securities and Exchange Commission upon request.
(4)(h) Rights Agreement, dated December 14, 1989, between the Company and
Harris Trust Company of New York with respect to the Preferred Share Purchase
Rights. Incorporated by reference to Exhibit 1 to the Company's Form 8-K dated
December 15,1989.
(10)(a) Stock Purchase Agreement between the Company and Berkshire Hathaway
Inc., dated March 18, 1985. Incorporated by reference to Appendix B to the
Company's and American Broadcasting Companies, Inc.'s Joint Proxy Statement-
Prospectus dated May 10, 1985.
(10)(b) Stock Purchase Agreement among the Company, Berkshire Hathaway Inc.,
National Indemnity Company, National Fire and Marine Insurance Company, Columbia
Insurance Company, Nebraska Furniture Mart, Inc. and Cornhusker Casualty
Company, dated January 2, 1986. Incorporated by reference to Exhibit A to the
Schedule 13D dated January 8, 1986 filed by Berkshire Hathaway Inc. and others
in regard to the Company's common stock.
(10)(c) Amendment dated October 29, 1993 to the Stock Purchase Agreement set
forth in Exhibit (10)(b) above. Incorporated by reference to Exhibit 99(c) to
the Company's Schedule 13E-4 dated November 2, 1993.
*(10)(d) Supplemental Profit Sharing Plan of the Company, as amended through
April 9, 1992. Incorporated by reference to Exhibit (10)(c) to the Company's
Annual Report on Form 10-K for 1992.
*(10)(e) Benefit Equalization Plan of the Company, as amended through January
1, 1994.
*(10)(f) Incentive Compensation Plan of the Company, as amended through
December 9, 1993.
*(10)(g) Employee Stock Option Plan of the Company, as amended through December
15, 1987. Incorporated by reference to Exhibit (10)(f) to the Company's Annual
Report on Form 10-K for 1992.
*(10)(h) 1991 Stock Option Plan of the Company, as amended through March 19,
1991. Incorporated by reference to Exhibit (10)(g) to the Company's Annual
Report on Form 10-K for 1992.
*(10)(i) Contract dated January 2, 1968 between John B. Fairchild and Fairchild
Publications, Inc., as amended by contract of June 1977 between Mr. Fairchild
and Capital Cities Media, Inc. (a subsidiary of the Company) as successor to
Fairchild Publications, Inc. (Mr. Fairchild is an executive
K-18
officer and a director of the Company.) Incorporated by reference to Exhibit
(10)(h) to the Company's Annual Report on Form 10-K for 1992.
*(10)(j) The Company's Retirement Plan for Nonemployee Directors, as adopted by
Board of Directors resolution dated March 20, 1990. Incorporated by reference
to Exhibit (10)(i) to the Company's Annual Report on Form 10-K for 1992.
(13) The Company's 1993 Annual Report to Shareholders. (This report, except
for the portions thereof which are incorporated by reference in this Form 10-K,
is furnished for the information of the Securities and Exchange Commission and
is not to be deemed "filed" as part of this Form 10-K.)
(21) Subsidiaries of the Company.
(99)(a) Form 11-K for the Company's Savings & Investment Plan for the year
ended December 31, 1993.
(99)(b) Undertakings.
----------
* Executive officers' and directors' compensation plans and arrangements.
K-19
CAPITAL CITIES/ABC, INC.
PROPERTY, PLANT AND EQUIPMENT -- SCHEDULE V
(Thousands of Dollars)
[Enlarge/Download Table]
Balance at Operating Additions Retire- Other Balance
beginning companies at ments changes at close
of period acquired cost or sales (a) of period
---------- --------- --------- --------- ------- ---------
Year ended December 31, 1993:
Land and improvements..................... $ 333,816 $ 834 $ 1,561 $ (1,492) $ 334,719
Buildings and improvements................ 692,772 3,285 16,266 (4,421) 707,902
Broadcasting equipment.................... 576,431 550 51,093 (27,831) 600,243
Printing machinery and equipment.......... 178,877 1,319 13,324 (5,235) 188,285
Other, including construction-in-progress. 226,338 847 15,544 (3,865) 238,864
---------- ------ -------- --------- ----------
$2,008,234 $6,835 $ 97,788 $ (42,844) $2,070,013
========== ====== ======== ========= ==========
Year ended December 31, 1992:
Land and improvements..................... $ 403,482 $ 133 $ (69,799) $ 333,816
Buildings and improvements................ 633,859 38,816 (18,683) $38,780 692,772
Broadcasting equipment.................... 514,799 $ 296 69,657 (8,321) 576,431
Printing machinery and equipment.......... 174,718 50 12,382 (8,273) 178,877
Other, including construction-in-progress. 234,654 46 (6,252) (2,110) 226,338
---------- ------ -------- --------- ------- ----------
$1,961,512 $ 392 $114,736 $(107,186) $38,780 $2,008,234
========== ====== ======== ========= ======= ==========
Year ended December 31, 1991:
Land and improvements..................... $ 403,338 $ 221 $ (77) $ 403,482
Buildings and improvements................ 621,470 20,736 (8,347) 633,859
Broadcasting equipment.................... 450,807 68,911 (4,919) 514,799
Printing machinery and equipment.......... 171,714 $ 249 7,517 (4,762) 174,718
Other, including construction-in-progress. 213,731 51 23,613 (2,741) 234,654
---------- ------ -------- --------- ----------
$1,861,060 $ 300 $120,998 $ (20,846) $1,961,512
========== ====== ======== ========= ==========
----------
(a) Represents adjustments related to the adoption of Financial Accounting
Standard No. 109 "Accounting for Income Taxes."
VALUATION AND QUALIFYING ACCOUNTS -- SCHEDULE VIII
(Thousands of Dollars)
[Enlarge/Download Table]
Additions Deductions
------------------ -----------------------
Balance at Operating Charged Operating Accounts Balance
beginning companies to companies written-off, at close
of period acquired expense disposed net of period
---------- --------- ------- --------- ------------ ---------
Deducted from accounts and notes receivable:
Year ended December 31, 1993................. $35,114 $490 $31,876 $(22,830) $44,650
Year ended December 31, 1992................. 38,302 24 48,458 $(8,680) (42,990) 35,114
Year ended December 31, 1991................. 37,840 51,941 (30) (51,449) 38,302
K-20
CAPITAL CITIES/ABC, INC.
ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY,
PLANT AND EQUIPMENT--SCHEDULE VI
(Thousands of Dollars)
[Download Table]
Balance at Retire- Balance
beginning Charged ments at close
of period to expense or sales of period
--------- ---------- --------- ---------
Year ended December 31, 1993:
Land improvements................ $ 3,301 $ 448 $ (91) $ 3,658
Buildings and improvements....... 159,049 23,195 (2,006) 180,238
Broadcasting equipment........... 368,255 49,125 (25,871) 391,509
Printing machinery and equipment. 104,256 12,756 (5,074) 111,938
Other............................ 57,389 9,508 (2,954) 63,943
-------- ------- -------- --------
$692,250 $95,032 $(35,996) $751,286
======== ======= ======== ========
Year ended December 31, 1992:
Land improvements................ $ 2,790 $ 578 $ (67) $ 3,301
Buildings and improvements....... 141,876 23,691 (6,518) 159,049
Broadcasting equipment........... 326,314 49,852 (7,911) 368,255
Printing machinery and equipment. 97,262 12,294 (5,300) 104,256
Other............................ 49,995 9,249 (1,855) 57,389
-------- ------- -------- --------
$618,237 $95,664 $(21,651) $692,250
======== ======= ======== ========
Year ended December 31, 1991:
Land improvements................ $ 2,404 $ 386 $ 2,790
Buildings and improvements....... 124,663 22,964 $ (5,751) 141,876
Broadcasting equipment........... 275,749 51,253 (688) 326,314
Printing machinery and equipment. 89,093 12,140 (3,971) 97,262
Other............................ 47,560 9,294 (6,859) 49,995
-------- ------- -------- --------
$539,469 $96,037 $(17,269) $618,237
======== ======= ======== ========
----------
Depreciation is computed on the straight-line method over the following
estimated useful lives: buildings and improvements--10 to 55 years;
broadcasting equipment--4 to 20 years; printing machinery and equipment--5 to
20 years.
SUPPLEMENTARY INCOME STATEMENT INFORMATION--SCHEDULE X
(Thousands of Dollars)
[Download Table]
Advertising
Royalties costs
--------- -----------
Year ended December 31, 1993............ $30,847 $136,817
Year ended December 31, 1992............ 70,203 135,157
Year ended December 31, 1991............ 66,191 133,018
K-21
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this Annual Report to be signed on
its behalf by the undersigned, thereunto duly authorized.
CAPITAL CITIES/ABC, INC.
(Registrant)
/s/ THOMAS S. MURPHY
------------------------
(Thomas S. Murphy)
Chairman of the Board and Chief Executive Officer March 14, 1994
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the date indicated:
[Download Table]
Principal Executive Officer:
/s/ THOMAS S. MURPHY
---------------------------
(Thomas S. Murphy) March 14, 1994
Principal Financial Officer:
/s/ RONALD J. DOERFLER
---------------------------
(Ronald J. Doerfler) March 14, 1994
Controller:
/s/ ALLAN J. EDELSON
---------------------------
(Allan J. Edelson) March 14, 1994
Directors:
/s/ ROBERT P. BAUMAN
---------------------------
(Robert P. Bauman) March 14, 1994
/s/ NICHOLAS F. BRADY
---------------------------
(Nicholas F. Brady) March 14, 1994
/s/ WARREN E. BUFFETT
---------------------------
(Warren E. Buffett) March 14, 1994
/s/ DANIEL B. BURKE
---------------------------
(Daniel B. Burke) March 14, 1994
/s/ FRANK T. CARY
---------------------------
(Frank T. Cary) March 14, 1994
/s/ JOHN B. FAIRCHILD
---------------------------
(John B. Fairchild) March 14, 1994
/s/ LEONARD H. GOLDENSON
---------------------------
(Leonard H. Goldenson) March 14, 1994
/s/ FRANK S. JONES
---------------------------
(Frank S. Jones) March 14, 1994
/s/ ANN DIBBLE JORDAN
---------------------------
(Ann Dibble Jordan) March 14, 1994
/s/ JOHN H. MULLER, JR.
---------------------------
(John H. Muller, Jr.) March 14, 1994
/s/ THOMAS S. MURPHY
---------------------------
(Thomas S. Murphy) March 14, 1994
/s/ WYNDHAM ROBERTSON
---------------------------
(Wyndham Robertson) March 14, 1994
/s/ M. CABELL WOODWARD, JR.
---------------------------
(M. Cabell Woodward, Jr.) March 14, 1994
K-22
Dates Referenced Herein and Documents Incorporated by Reference
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Filing Submission 0000950130-94-000530 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
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