DALLAS, Jan. 3, 2011 /PRNewswire-FirstCall/ -- Belo Corp.
(NYSE: BLC), one of the nation's largest pure-play, publicly-traded
television companies, announced today that it has completed the
split of The G. B. Dealey Retirement Pension Plan ("Pension Plan"
or "Plan") with A. H. Belo Corporation ("A.
H. Belo"). On October 6,
2010, Belo Corp. and A. H.
Belo agreed to split the Pension Plan into
separately-sponsored plans following the spin-off in February 2008 of Belo Corp.'s newspaper
businesses and related assets into a separate publicly-traded
company, A. H. Belo.
Benefit liabilities and assets allocable to the approximately
5,100 current and former employee participants of A. H. Belo and its newspaper businesses were
transferred in accordance with government regulations to two new
defined benefit pension plans created, sponsored and managed by or
on behalf of A. H. Belo, and the new
A. H. Belo plans are now solely
responsible for paying those benefits. A final assessment and
reconciliation of the assets and liabilities transferred will be
completed by the end of the second quarter of 2011 based on final
January 1, 2011 data.
The benefit liabilities and assets allocable to current and
former employee participants of Belo Corp. and its television
businesses continue to be held by the existing Pension Plan
sponsored and managed by or on behalf of Belo Corp. The split
of the Plan does not change the amount of the benefits any
participant has accrued or is currently receiving.
For plan years starting on and after January 1, 2011, Belo Corp. and A. H. Belo are each solely responsible for
making contributions to their respective plans. Belo Corp.'s
pension contributions for full year 2011 are currently expected to
be around $16 million.
For Belo Corp., the pension split transaction will be treated as
a settlement of a portion of the Pension Plan liability for
accounting purposes. Under settlement accounting, the pension
split is expected to result in a significant reduction to Belo
Corp.'s net unfunded pension liability, with an associated
reduction in pension-related deferred tax assets and a significant
increase in the Company's total shareholders' equity. In
addition, Belo Corp.'s future annual pension expense is expected to
be significantly less than if the Plan were not split.
Belo Corp. currently expects to report a non-cash loss
associated with the split of the Pension Plan in the first quarter
of 2011 in the range of $19 to $23
million with an associated tax benefit in the range of
$5 to $7 million; however, the actual
amount of the non-cash loss and associated tax benefit is subject
to change and may be more or less than these ranges depending on
several factors, including differences in the Company's current
estimates related to asset performance, the discount rate,
contributions and benefit payments.
The non-cash loss has two primary components: a settlement
gain related to the transfer to A. H.
Belo of its portion of the net unfunded pension liability
and a settlement loss related to the immediate recognition, upon
the transfer of the Plan's assets and liabilities, of previously
unrecognized actuarial pension losses. These unrecognized
losses were previously recorded as part of the Company's
accumulated other comprehensive income. The non-cash loss,
before taxes, will be shown on a separate line within operating
costs and expenses on the Company's Statement of Operations.
About Belo Corp.
Belo Corp. (NYSE: BLC), one of the nation's largest pure-play,
publicly-traded television companies, owns and operates 20
television stations (nine in the top 25 markets) and their
associated Web sites. Belo stations, which include
affiliations with ABC, CBS, NBC, FOX, and the CW, reach more than
14 percent of U.S. television households in 15 highly attractive
markets. Belo stations rank first or second in nearly all of
their local markets. Additional information is available at
www.belo.com or by contacting Paul
Fry, vice president/Investor Relations & Treasury
Operations, at 214-977-6835.
Statements in this communication concerning Belo's business
outlook or future economic performance, anticipated profitability,
revenues, expenses, capital expenditures, investments, future
financings, impairments, pension matters, and other financial and
non-financial items that are not historical facts, are
"forward-looking statements" as the term is defined under
applicable federal securities laws. Forward-looking statements are
subject to risks, uncertainties and other factors that could cause
actual results to differ materially from those statements.
Such risks, uncertainties and factors include, but are not
limited to, uncertainties regarding the costs, consequences
(including tax consequences) and other effects of Belo's spin-off
distribution of its newspaper businesses and related assets to
A. H. Belo and the associated
agreements between Belo and A. H.
Belo relating to various matters; changes in capital market
conditions and prospects, and other factors such as changes in
advertising demand, interest rates and programming and production
costs; changes in viewership patterns and demography, and actions
by Nielsen; changes in the network-affiliate business model for
broadcast television; technological changes, and the development of
new systems to distribute television and other audio-visual
content; changes in the ability to secure, and in the terms of,
carriage of Belo programming on cable, satellite,
telecommunications and other program distribution methods;
development of Internet commerce; industry cycles; changes
in pricing or other actions by competitors and suppliers; Federal
Communications Commission and other regulatory, tax and legal
changes; adoption of new accounting standards or changes in
existing accounting standards by the Financial Accounting Standards
Board or other accounting standard-setting bodies or authorities;
the effects of Belo acquisitions, dispositions, co-owned ventures,
and investments; pension plan matters; general economic conditions;
and significant armed conflict, as well as other risks detailed in
Belo's other public disclosures and filings with the SEC including
Belo's Annual Report on Form 10-K.
SOURCE Belo Corp.