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To Our Shareholders

Now in our 136th year, we pride ourselves on constant reinvention to better serve customers and build value for owners. In 2014 we saw yet another lunge forward.

We made the strategic decision, announced in July, to join with Journal Communications in creating two new, very different-looking companies from our existing businesses. Together we owned newspapers and television stations as well as radio stations and digital brands. We realized we could realign these businesses to create two public companies that could better focus on the dynamics and opportunities of their respective industries.

The new E.W. Scripps Company is now one of the nation’s largest independent television station owners, with 33 television stations, as well as 34 radio stations and an expanding portfolio of digital news and information brands. It reaches 18 percent of U.S. television households in some of the most attractive local markets in the country, including Denver, Nashville, Las Vegas, Detroit, and Phoenix. Complementing these stations are market-leading digital products and services.

We also combined the venerable Milwaukee Journal Sentinel with strong Scripps newspapers in 13 markets, including The Commercial Appeal of Memphis, The Knoxville News Sentinel and The Naples Daily News to form a Milwaukee-based public newspaper company called Journal Media Group. It launched with financial flexibility, a foundation of journalism excellence, and total Sunday circulation of more than 1 million print copies.

These transactions let us group together those two journalism platforms into separate public companies that can compete and evolve and unlock value for you, our shareholders.

A look back at 2014
While we worked to complete the transaction with Journal Communications in 2014, other priorities did not wane. We also announced and quickly closed on the acquisitions of two television stations from Granite Broadcasting – an ABC affiliate in Buffalo and a MyNetworkTV affiliate in Detroit that pairs with our Detroit ABC station to create an attractive duopoly. Duopolies continue to be an acquisition priority for us.

We also completed negotiations at year-end on a new five-year contract with the ABC Network that covers our 10 legacy ABC affiliates until end of 2019. We have a long-standing and mutually beneficial relationship with ABC, and this agreement reflects that strong bond.

And we fully integrated our $35 million Newsy acquisition, including introducing the Newsy video player on our local news websites late in 2014. Across all of our digital businesses, we served up more than 235 million video views, and the majority of those came through Newsy’s reach across all of its products. The large and growing Newsy audience gives us the opportunity to take advantage of valuable and rising amounts of pre-roll video advertising.

Our total television station website performance also was strong. Our TV markets served up 955 million page views in 2014, an increase of 6 percent over 2013.

It was also a good year for viewer growth at our television stations. In the November 2014 rating period, eight stations finished first or second in key adult demographics in at least one of the major local news time periods (6 a.m., 6 p.m. or late news). Twelve of our 14 major network-affiliated stations improved their percentage of local news viewing in at least one of these time periods over the same time in November 2013. Five stations improved their market rank in at least one newscast in November 2014.

We launched our fourth original program in 2014. The Now began airing last fall at 4 p.m. in eight of our markets. It is designed to capture the afternoon TV-viewing audience ahead of our 5 p.m. news programs by offering more in-depth local stories and local points of view on national stories with a lively format not anchored by a news desk. We’re seeing good audience response, and the show frees us from expensive syndication programming and its revenue-share arrangements. In addition, RightThisMinute, our partnership show with Cox and Raycom, now reaches more than 93 percent of U.S. TV households in its fourth year. The List is winding down its third year to solid showings.. We expect to maintain three to four shows at a time, and although they may not all have 20-year runs, we are constantly looking at new ideas that fit our strategy of news and information shows that help us retain audiences and revenue.

In our newspaper division, we saw a full year of bundled print and digital subscriptions in 2014 as well as strategic price increases that helped drive subscription revenue to 3.2 percent growth for the year – the first time in several years we have seen positive growth in that revenue line. In addition, the division’s careful management of employee costs helped preserve segment profit in spite of the ongoing challenges in the industry and an especially difficult fourth quarter. A bright spot was the nearly 50 percent increase in digital-only subscribers to our newspapers’ suite of smartphone, tablet and desktop news products. The audience is moving in the right direction.

Finally, we know investors are eager to see us return to our share buyback program. The board has authorized $100 million in share repurchase funds that are now available to use. In the two years before we announced the deal, we spent $95 million to purchase 6.2 million shares.

As we look to the remainder of 2015, our focus lies on combining the new Scripps operations and continuing to execute on our strategies for growing our digital products, audiences and revenue, eventually expanding our original programming to the new stations and preparing for a tremendous presidential election spending year in 2016.

Thanks for your support.

Sincerely,

Richard A. Boehne

 

Guardianship Program

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Message to shareholders

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A rich history and a focus on the future.

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Rich Boehne, Chairman, President & CEO
A rich history and a focus on the future