The New York Times Company
2016 Annual Report
TO OUR
SHAREHOLDERS,
Two thousand and sixteen was a year of great progress in The New York Times Company’s continuing digital
transformation. We enter 2017 firmly rooted as a subscription-first, consumer-focused global news provider,
committed to delivering independent journalism worth paying for, and innovative premium advertising
experiences worth paying for. Ours is a distinctive vision — and one that audiences and advertisers around
the world responded to in 2016.
We believe this past year’s unprecedented growth in digital subscriptions is a strong vindication of
our strategic direction. Six years after its launch, our digital pay model is the most successful digital pay
model for news in the world. We now have more than three million print and digital subscriptions, far
more than at any point in our history. This is a tribute in large measure to the sustained, exceptional quality
of our journalism.
Times journalism is in amazing form, and audiences have been flocking to our authoritative coverage of,
and comment about, a momentous period in the politics of America and the world. From the American
presidential election to Brexit to the terror attack in Nice and the devastation of Hurricane Matthew in Haiti,
our journalists reported from the ground in more than 150 countries last year, often at great personal risk.
The year brought no shortage of honors for our journalism. The Times was awarded two Pulitzer Prizes, one
for international reporting and the other for breaking news photography. In addition, we had an amazing
10 Pulitzer finalists, the most in our history other than the period following 9/11. These included powerful
examples of our visual journalism, including virtual reality and multimedia.
We also received nine News & Documentary Emmy nominations — more than many broadcasters — for
the great strides we’re making in video. And, in June, we won two significant prizes at the Cannes Lions
Advertising Festival.
To bring that journalism to the widest possible audience, we continued to expand our global footprint
in 2016. In February we launched The New York Times en Español, which offers original journalism in
Spanish, as well as translated Times content. And we announced plans to expand in Canada and Australia,
as part of our effort to grow Times readership outside the United States. In early 2017, we announced new
collaborations with Spotify and Snapchat that we believe will further help us broaden our reach to new
audiences.
We also created new and innovative platforms for our journalism. We launched The Daily 360, a first-of-
its-kind virtual-reality project, various podcasts including The Run-Up and Still Processing, a new TV and
movie recommendation website, Watching, and an expansion of health and wellness franchise, Well.
During 2016, we continued to invest in our business. In the fall we acquired The Wirecutter and The
Sweethome, product-recommendation websites that serve as guides to technology gear, home products
and other consumer goods. This business aligns with our commitment to creating products that are an
indispensable part of our readers’ lives.
We also made two acquisitions that we believe broaden the range of marketing and creative services
provided by T Brand Studio, our award-winning marketing and creative services agency. HelloSociety is a
digital marketing agency that leverages social media influencers to drive engagement for branded content
campaigns and Fake Love is an integrated experience design agency that specializes in anchoring brands
in contemporary culture via creative programs, live experiences and virtual and mixed reality.
2016 ANNUAL REPORT
On the strength of revenue growth from our mobile platform, programmatic buying channels and branded
content, we saw a meaningful increase in digital advertising revenue for 2016. We are committed to
continuing this growth while managing the continued secular declines in print advertising and legacy parts
of digital advertising.
One significant transformation in 2017 will be the way we use our headquarters building at 620 Eighth
Avenue. We plan to invest in a redesign of our existing space to create a more dynamic, collaborative and
open workplace. As part of this plan, the company will reduce the number of floors that we occupy, allowing
us to generate additional rental income on those floors.
Looking ahead, we will continue to keep a sharp focus on our cost base, while investing where appropriate
to support growth. At the same time, we remain deeply committed to protecting our investment in the
original newsgathering and storytelling that make The Times so indispensable.
In the coming months, with the support of our board and relying on the dedication of our colleagues in every
corner of the world, we will continue to execute our strategy of producing the world’s finest journalism
along with innovative products and services to bring that journalism to the world. We remain committed to
doubling our digital revenue by 2020, growing the company’s profitability in the long term and increasing
shareholder value.
We thank you for your continued support.
Arthur O. Sulzberger Jr.
Chairman
Mark Thompson
President and C.E.O.
February 22, 2017
2016 ANNUAL REPORT
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended December 25, 2016
Commission file number 1-5837
THE NEW YORK TIMES COMPANY
(Exact name of registrant as specified in its charter)
New York
(State or other jurisdiction of
incorporation or organization)
620 Eighth Avenue, New York, N.Y.
(Address of principal executive offices)
13-1102020
(I.R.S. Employer
Identification No.)
10018
(Zip code)
Registrant’s telephone number, including area code: (212) 556-1234
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Class A Common Stock of $.10 par value
Name of each exchange on which registered
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: Not Applicable
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes
No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Exchange Act. Yes
No
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
No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site,
if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during
the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes
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.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated
filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer
Non-accelerated filer
Accelerated filer
Smaller reporting company
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes
No
The aggregate worldwide market value of Class A Common Stock held by non-affiliates, based on the closing
price on June 24, 2016, the last business day of the registrant’s most recently completed second quarter, as reported on
the New York Stock Exchange, was approximately $1.8 billion. As of such date, non-affiliates held 69,667 shares of Class
B Common Stock. There is no active market for such stock.
The number of outstanding shares of each class of the registrant’s common stock as of February 15, 2017
(exclusive of treasury shares), was as follows: 160,384,114 shares of Class A Common Stock and 812,757 shares of Class
B Common Stock.
Documents incorporated by reference
Portions of the Proxy Statement relating to the registrant’s 2017 Annual Meeting of Stockholders, to be held on
April 19, 2017, are incorporated by reference into Part III of this report.
INDEX TO THE NEW YORK TIMES COMPANY 2016 ANNUAL REPORT ON FORM 10-K
ITEM NO.
PART I
Forward-Looking Statements
Business
1
Overview
Products
Circulation and Audience
Advertising
Competition
Other Businesses
Joint Venture Investments
Print Production and Distribution
Raw Materials
Employees and Labor Relations
Available Information
1A Risk Factors
1B Unresolved Staff Comments
2
Properties
3
Legal Proceedings
4 Mine Safety Disclosures
Executive Officers of the Registrant
PART II
5 Market for the Registrant’s Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities
Selected Financial Data
6
7 Management’s Discussion and Analysis of
Financial Condition and Results of Operations
7A Quantitative and Qualitative Disclosures About Market Risk
8
Financial Statements and Supplementary Data
9
Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure
9A Controls and Procedures
9B Other Information
PART III
10 Directors, Executive Officers and Corporate Governance
11
12
Executive Compensation
Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters
13 Certain Relationships and Related Transactions, and Director Independence
14
Principal Accountant Fees and Services
PART IV
15
Exhibits and Financial Statement Schedules
1
1
1
2
2
3
3
4
4
5
5
5
5
6
13
14
14
14
15
16
18
22
47
48
103
103
103
104
104
104
105
105
106
PART I
FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K, including the sections titled “Item 1A — Risk Factors” and “Item 7 —
Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains forward-looking
statements that relate to future events or our future financial performance. We may also make written and oral
forward-looking statements in our Securities and Exchange Commission (“SEC”) filings and otherwise. We have
tried, where possible, to identify such statements by using words such as “believe,” “expect,” “intend,” “estimate,”
“anticipate,” “will,” “could,” “project,” “plan” and similar expressions in connection with any discussion of future
operating or financial performance. Any forward-looking statements are and will be based upon our then-current
expectations, estimates and assumptions regarding future events and are applicable only as of the dates of such
statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
By their nature, forward-looking statements are subject to risks and uncertainties that could cause actual results
to differ materially from those anticipated in any such statements. You should bear this in mind as you consider
forward-looking statements. Factors that we think could, individually or in the aggregate, cause our actual results to
differ materially from expected and historical results include those described in “Item 1A — Risk Factors” below, as
well as other risks and factors identified from time to time in our SEC filings.
ITEM 1. BUSINESS
OVERVIEW
The New York Times Company (the “Company”) was incorporated on August 26, 1896, under the laws of the
State of New York. The Company and its consolidated subsidiaries are referred to collectively in this Annual Report
on Form 10-K as “we,” “our” and “us.”
We are a global media organization focused on creating, collecting and distributing high-quality news and
information. Our continued commitment to premium content and journalistic excellence makes The New York Times
brand a trusted source of news and information for readers and viewers across various platforms. Recognized widely
for the quality of our reporting and content, our publications have been awarded many industry and peer accolades,
including 119 Pulitzer Prizes and citations, more than any other news organization.
The Company includes newspapers, print and digital products and investments. We have one reportable
segment with businesses that include:
• our newspaper, The New York Times (“The Times”);
• our websites, including NYTimes.com;
• our mobile applications, including The Times’s core news applications, as well as interest-specific
applications such as NYT Cooking, Crossword and others; and
•
related businesses, such as The Times news services division, product review and recommendation websites
The Wirecutter and The Sweethome, digital archive distribution, NYT Live (our live events business) and
other products and services under The Times brand.
We generate revenues principally from circulation and advertising. Circulation revenue is derived from the sale
of subscriptions to our print, web and mobile products and single-copy sales of our print newspaper. Advertising
revenue is derived from the sale of our advertising products and services on our print, web and mobile platforms.
Revenue information for the Company appears under “Item 7 — Management’s Discussion and Analysis of Financial
Condition and Results of Operations.”
During 2016, the Company continued to focus on investing in original, quality journalism across its print and
digital platforms. Among other things, we launched groundbreaking digital journalism projects and created
compelling special inserts in our print newspaper. In addition, we continued to create innovative digital advertising
solutions across our platforms and continued to expand our branded content studio.
THE NEW YORK TIMES COMPANY – P. 1
We also made a number of acquisitions during the year. In March 2016 and August 2016, we acquired digital
marketing agencies, HelloSociety and Fake Love, respectively, for a total of $15.4 million. And in October 2016, we
acquired product review and recommendation websites The Wirecutter and The Sweethome for $25.0 million. See
Note 4 of the Notes to the Consolidated Financial Statements for additional information regarding these acquisitions.
The Company sold the New England Media Group in 2013 and the Regional Media Group and the About
Group in 2012. The results of operations for these businesses have been presented as discontinued operations for all
periods presented. See Note 13 of the Notes to the Consolidated Financial Statements for additional information
regarding these discontinued operations.
PRODUCTS
The Company’s principal business consists of distributing content generated by our newsroom through our
print, web and mobile platforms. In addition, we distribute selected content on third-party platforms. The Times’s
print edition, a daily (Mon. - Sat.) and Sunday newspaper in the United States, commenced publication in 1851. The
NYTimes.com website was launched in 1996. The Times also has an international edition that is tailored and edited
for global audiences. First published in 2013 and previously called the International New York Times, the
international edition succeeded the International Herald Tribune, a leading daily newspaper that commenced
publishing in Paris in 1887.
Our print newspapers are sold in the United States and around the world through individual home-delivery
subscriptions, bulk subscriptions (primarily by schools and hotels) and single-copy sales. All print home-delivery
subscribers are entitled to receive unlimited digital access.
Since 2011, we have charged consumers for content provided on our core news websites and mobile
applications. Digital subscriptions can be purchased individually or through group corporate or group education
subscriptions. Our metered model offers users free access to a set number of articles per month and then charges
users for access to content beyond that limit. In addition, certain subscriptions include access to Times Insider, a suite
of exclusive online content and features.
In addition to our core news websites and mobile applications, the Company has a number of websites and
mobile applications that are tailored to a variety of interests, including NYT Cooking and our Crossword product.
CIRCULATION AND AUDIENCE
Our content reaches a broad audience through our print, web and mobile platforms. As of December 25, 2016,
we had approximately 2.9 million paid subscriptions in 195 countries to our print and digital products, and in early
2017, we surpassed three million paid subscriptions to our products.
In the United States, The Times had the largest daily and Sunday circulation of all seven-day newspapers for
the three-month period ended September 30, 2016, according to data collected by the Alliance for Audited Media
(“AAM”), an independent agency that audits circulation of most U.S. newspapers and magazines.
For the fiscal year ended December 25, 2016, The Times’s average print circulation (which includes paid and
qualified circulation of the newspaper in print) was approximately 571,500 for weekday (Monday to Friday) and
1,085,700 for Sunday. (Under AAM’s reporting guidance, qualified circulation represents copies available for
individual consumers that are either non-paid or paid by someone other than the individual, such as copies delivered
to schools and colleges and copies purchased by businesses for free distribution.)
Internationally, average circulation for the international edition of our newspaper (which includes paid
circulation of the newspaper in print and electronic replica editions) for the fiscal years ended December 25, 2016, and
December 27, 2015, was approximately 197,000 (estimated) and 215,000, respectively. These figures follow the
guidance of Office de Justification de la Diffusion, an agency based in Paris and a member of the International
Federation of Audit Bureaux of Circulations that audits the circulation of most newspapers and magazines in France.
The final 2016 figure will not be available until April 2017.
Paid digital-only subscriptions totaled approximately 1,853,000 as of December 25, 2016, an increase of
approximately 46% compared with December 27, 2015. This amount includes paid subscriptions to our Crossword
product, which totaled approximately 245,000 as of December 25, 2016. This amount also includes estimated group
corporate and group education subscriptions (which collectively represent approximately 7% of total paid digital
subscriptions to our news products). The number of paid group subscriptions is derived using the value of the
P. 2 – THE NEW YORK TIMES COMPANY
relevant contract and a discounted basic subscription rate. The actual number of users who have access to our
products through group subscriptions is substantially higher.
According to comScore Media Metrix, an online audience measurement service, in 2016, NYTimes.com had a
monthly average of approximately 85 million unique visitors in the United States on either desktop/laptop computers
or mobile devices. Globally, including the United States, NYTimes.com had a 2016 monthly average of approximately
122 million unique visitors on either desktop/laptop computers or mobile devices, according to internal data
estimates.
ADVERTISING
We have a comprehensive portfolio of advertising products and services that we provide across print, web and
mobile platforms. Our advertising revenue is divided into three main categories:
Display Advertising
Display advertising is principally from advertisers promoting products, services or brands, such as financial
institutions, movie studios, department stores, American and international fashion and technology. In print, column-
inch ads are priced according to established rates, with premiums for color and positioning. The Times had the largest
market share in 2016 in print advertising revenue among a national newspaper set that consists of USA Today, The
Wall Street Journal and The Times, according to MediaRadar, an independent agency that measures advertising sales
volume and estimates advertising revenue.
On our web and mobile platforms, display advertising comprises banners, video, rich media and other
interactive ads. Display advertising also includes branded content on The Times’s platforms. Branded content is
longer form marketing content that is distinct from The Times’s editorial content. In 2016, display advertising (print
and digital) represented approximately 89% of advertising revenues.
Classified Advertising
Classified advertising includes line ads sold in the major categories of real estate, help wanted, automotive and
other. In print, classified advertisers pay on a per-line basis. On our web and mobile platforms, classified advertisers
pay on either a per-listing basis for bundled listing packages, or as an add-on to their print ad. In 2016, classified
advertising (print and digital) represented approximately 5% of advertising revenues.
Other Advertising
Other advertising primarily includes creative services fees associated with our branded content studio and
digital marketing agencies; revenues from preprinted advertising, also known as free-standing inserts; revenues
generated from branded bags in which our newspapers are delivered; and advertising revenues from our news
services business. In 2016, other advertising (print and digital) represented approximately 6% of our advertising
revenues.
Our business is affected in part by seasonal patterns in advertising, with generally higher advertising volume in
the fourth quarter due to holiday advertising.
COMPETITION
Our print, web and mobile products compete for advertising and consumers with other media in their
respective markets, including paid and free newspapers, broadcast, satellite and cable television, broadcast and
satellite radio, magazines, other forms of media and direct marketing. Competition for advertising is generally based
upon audience levels and demographics, advertising rates, service, targeting capabilities and advertising results,
while competition for consumer revenue and readership is generally based upon platform, format, content, quality,
service, timeliness and price.
The Times competes for advertising and circulation primarily with national newspapers such as The Wall Street
Journal and USA Today; newspapers of general circulation in New York City and its suburbs; other daily and weekly
newspapers and television stations and networks in markets in which The Times is circulated; and some national
news and lifestyle magazines. The international edition of our newspaper competes with international sources of
English-language news, including The Wall Street Journal’s European and Asian Editions, the Financial Times, Time,
Bloomberg Business Week and The Economist.
THE NEW YORK TIMES COMPANY – P. 3
As our industry continues to experience a shift from print to digital media, our products face competition for
audience and advertising from a wide variety of digital media, including news and other information websites and
mobile applications, news aggregation sites, sites that cover niche content, social media platforms, and other forms of
media. In addition, we also compete for advertising on digital advertising networks and exchanges and real-time
bidding and other programmatic buying channels.
Our websites and mobile applications most directly compete for traffic and readership with other news and
information websites and mobile applications. NYTimes.com faces competition from sources such as WSJ.com,
washingtonpost.com, Google News, Yahoo! News, huffingtonpost.com, MSNBC.com and CNN.com. Internationally,
our websites and mobile applications compete against international online sources of English-language news,
including bbc.co.uk, guardian.co.uk, ft.com, WSJ.com, economist.com, huffingtonpost.com and reuters.com.
OTHER BUSINESSES
We derive revenue from other businesses, which primarily include:
• The Times news services division, which transmits articles, graphics and photographs from The Times and
other publications to approximately 2,000 newspapers, magazines and websites in over 100 countries and
territories worldwide. It also comprises a number of other businesses that primarily include our online retail
store, product licensing, news digests, book development and rights and permissions;
• The Company’s NYT Live business, which is a platform for our live journalism and convenes thought leaders
from business, academia and government at conferences and events to discuss topics ranging from education
to sustainability to the luxury business;
• The Wirecutter and The Sweethome, product review and recommendation websites acquired in October 2016
that serve as a guide to technology gear, home products and other consumer goods. These websites generate
affiliate referral revenue (revenue generated by offering direct links to merchants in exchange for a portion of
the sale price), which we record as other revenues; and
• Digital archive distribution, which licenses electronic archive databases to resellers of that information in the
business, professional and library markets.
JOINT VENTURE INVESTMENTS
We have noncontrolling ownership interests in three entities:
• 49% interest in Donahue Malbaie Inc., a Canadian newsprint company (“Malbaie”);
• 40% interest in Madison Paper Industries, a partnership that previously operated a paper mill (“Madison”);
and
• 30% interest in Women in the World, LLC, a live-event conference business.
Ownership of Malbaie is shared with the Resolute FP Canada Inc. (“Resolute Canada”), which owns the other
51%. Resolute Canada is a subsidiary of Resolute Forest Products Inc., a Delaware corporation (“Resolute”), which is
a large global manufacturer of paper, market pulp and wood products. Malbaie manufactures newsprint on the paper
machine it owns within Resolute’s paper mill in Clermont, Quebec, and is wholly dependent upon Resolute for its
pulp, which it purchases from this paper mill. In 2016, Malbaie produced approximately 226,000 metric tons of
newsprint, of which approximately 12% was sold to us.
The Company and UPM-Kymmene Corporation, a Finnish paper manufacturing company (“UPM”), are
partners through subsidiary companies in Madison. The Company’s percentage ownership is through an 80%-owned
consolidated subsidiary. UPM owns 60% of Madison, including a 10% interest through a 20% noncontrolling interest
in the consolidated subsidiary of the Company. The Madison paper mill closed during 2016 and the joint venture is
currently being liquidated.
These investments are accounted for under the equity method and reported in “Investments in joint ventures”
in our Consolidated Balance Sheets as of December 25, 2016. For additional information on these investments, see
“Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 5 of
the Notes to the Consolidated Financial Statements.
P. 4 – THE NEW YORK TIMES COMPANY
PRINT PRODUCTION AND DISTRIBUTION
The Times is currently printed at our production and distribution facility in College Point, N.Y., as well as under
contract at 27 remote print sites across the United States. The Times is delivered to newsstands and retail outlets in the
New York metropolitan area through a combination of third-party wholesalers and our own drivers. In other markets in
the United States and Canada, The Times is delivered through agreements with other newspapers and third-party
delivery agents.
The international edition of The Times is printed under contract at 38 sites throughout the world and is sold in
131 countries and territories. It is distributed through agreements with other newspapers and third-party delivery
agents.
RAW MATERIALS
The primary raw materials we use are newsprint and coated paper, which we purchase from a number of North
American and European producers. A significant portion of our newsprint is purchased from Resolute.
In 2016 and 2015, we used the following types and quantities of paper:
(In metric tons)
Newsprint
Coated and Supercalendered Paper
EMPLOYEES AND LABOR RELATIONS
2016
97,800
19,500
2015
104,200
20,400
We had 3,710 full-time equivalent employees as of December 25, 2016.
As of December 25, 2016, nearly half of our full-time equivalent employees were represented by unions. The
following is a list of collective bargaining agreements covering various categories of the Company’s employees and
their corresponding expiration dates. As indicated below, two collective bargaining agreements have expired and
negotiations for new contracts are ongoing. We cannot predict the timing or the outcome of these negotiations.
Employee Category
NewsGuild of New York
Typographers
Machinists
Mailers
Drivers
Paperhandlers
Pressmen
Stereotypers
Expiration Date
March 30, 2016
March 30, 2016
March 30, 2018
March 30, 2019
March 30, 2020
March 30, 2021
March 30, 2021
March 30, 2021
As of December 25, 2016, approximately 75 of our full-time equivalent employees were located in France, and
the terms and conditions of employment of those employees are established by a combination of French national
labor law, industry-wide collective agreements and Company-specific agreements.
AVAILABLE INFORMATION
Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all
amendments to those reports, and the Proxy Statement for our Annual Meeting of Stockholders are made available,
free of charge, on our website at http://www.nytco.com, as soon as reasonably practicable after such reports have
been filed with or furnished to the SEC.
THE NEW YORK TIMES COMPANY – P. 5
ITEM 1A. RISK FACTORS
You should carefully consider the risk factors described below, as well as the other information included in this
Annual Report on Form 10-K. Our business, financial condition or results of operations could be materially adversely
affected by any or all of these risks, or by other risks or uncertainties not presently known or currently deemed
immaterial, that may adversely affect us in the future.
We face significant competition in all aspects of our business.
We operate in a highly competitive environment. We compete for advertising and consumer revenue with both
traditional publishers and new content providers. Competition among companies offering online content is intense,
and new competitors can quickly emerge. Some of our current and potential competitors may have greater resources
than we do, which may allow them to compete more effectively than us.
Our ability to compete effectively depends on many factors both within and beyond our control, including
among others:
• our ability to continue to deliver high-quality journalism and content that is interesting and relevant to our
audience;
•
•
the popularity, usefulness, ease of use, performance and reliability of our digital products compared with
those of our competitors;
the engagement of our current readers with our print and digital products, and our ability to reach new
readers;
• our ability to develop, maintain and monetize products;
•
the pricing of our products;
• our marketing and selling efforts, including our ability to provide marketers with a compelling return on
their investments;
• our ability to attract, retain, and motivate talented employees, including journalists and product and
technology specialists;
• our ability to manage and grow our operations in a cost-effective manner; and
• our reputation and brand strength relative to those of our competitors.
Our success depends on our ability to respond and adapt to changes in technology and consumer behavior.
Technology in the media industry continues to evolve rapidly. Advances in technology have led to an increased
number of methods for the delivery and consumption of news and other content. These developments are also
driving changes in the preferences and expectations of consumers as they seek more control over how they consume
content.
Changes in technology and consumer behavior pose a number of challenges that could adversely affect our
revenues and competitive position. For example, among others:
• we may be unable to develop products for mobile devices or other digital platforms that consumers find
engaging, that work with a variety of operating systems and networks and that achieve a high level of market
acceptance;
•
there may be changes in user sentiment about the quality or usefulness of our existing products or concerns
related to privacy, security or other factors;
• news aggregation websites and customized news feeds may reduce our traffic levels by creating a
disincentive for users to visit our websites or use our digital products;
•
•
consumers’ increased reliance on mobile devices for the consumption of news and other content may
contribute to a decline in engagement with our products;
failure to successfully manage changes in search engine optimization and social media traffic to increase our
digital presence and visibility may reduce our traffic levels;
P. 6 – THE NEW YORK TIMES COMPANY
• we may be unable to maintain or update our technology infrastructure in a way that meets market and
consumer demands; and
•
the distribution of our content on delivery platforms of third parties may lead to limitations on monetization
of our products, the loss of control over distribution of our content and loss of a direct relationship with our
audience.
Responding to these changes may require significant investment. We may be limited in our ability to invest
funds and resources in digital products, services or opportunities, and we may incur expense in building, maintaining
and evolving our technology infrastructure.
Unless we are able to use new and existing technologies to distinguish our products and services from those of
our competitors and develop in a timely manner compelling new products and services that engage users across
platforms, our business, financial condition and prospects may be adversely affected.
Our advertising revenues are affected by numerous factors, including economic conditions, market dynamics,
audience fragmentation and evolving digital advertising trends.
We derive substantial revenues from the sale of advertising in our products. Advertising spending is sensitive
to overall economic conditions, and our advertising revenues could be adversely affected if advertisers respond to
weak and uneven economic conditions by reducing their budgets or shifting spending patterns or priorities, or if they
are forced to consolidate or cease operations.
In determining whether to buy advertising, our advertisers consider the demand for our products,
demographics of our reader base, advertising rates, results observed by advertisers, and alternative advertising
options.
Although print advertising revenue continues to represent a majority of our total advertising revenue (64% of
our total advertising revenues in 2016), the increased popularity of digital media among consumers, particularly as a
source for news and other content, has driven a corresponding shift in demand from print advertising to digital
advertising. However, our digital advertising revenue may not replace in full print advertising revenue lost as a result
of the shift.
The increasing number of digital media options available, including through social networking platforms and
news aggregation websites, has expanded consumer choice significantly, resulting in audience fragmentation.
Competition from new content providers and platforms, some of which charge lower rates than we do or have greater
audience reach and targeting capabilities, and the significant increase in inventory of digital advertising space, have
affected and will likely continue to affect our ability to attract and retain advertisers and to maintain or increase our
advertising rates.
The digital advertising market itself continues to undergo significant change. Digital advertising networks and
exchanges, real-time bidding and other programmatic buying channels that allow advertisers to buy audiences at
scale are playing a more significant role in the advertising marketplace and may cause further downward pricing
pressure. New delivery platforms may also lead to loss of distribution and pricing control and loss of a direct
relationship with consumers. In addition, changes in the standards for the delivery of digital advertising, such as the
industry-wide standard on viewability, could also negatively affect our digital advertising revenues.
Technologies have been developed, and will likely continue to be developed, that enable consumers to
circumvent digital advertising on websites and mobile devices. Advertisements blocked by these technologies are
treated as not delivered and any revenue we would otherwise receive from the advertiser for that advertisement is
lost. Increased adoption of these technologies could adversely affect our advertising revenues, particularly if we are
unable to develop effective solutions to mitigate their impact.
As the digital advertising market continues to evolve, our ability to compete successfully for advertising
budgets will depend on, among other things, our ability to engage and grow digital audiences and prove the value of
our advertising and the effectiveness of our platforms to advertisers.
THE NEW YORK TIMES COMPANY – P. 7
We may experience further downward pressure on our advertising revenue margins.
The character of our digital advertising business continues to change, as demand for newer forms of
advertising, such as branded content and video advertising, increases. The margin on revenues from some of these
newer advertising forms tends to be lower than the margin on revenues we generate from our print advertising and
traditional digital display advertising. Consequently, we may experience further downward pressure on our
advertising revenue margins as a greater percentage of advertising revenues comes from these newer forms.
The inability of the Company to retain and grow our subscriber base could adversely affect our results of operations
and business.
Revenue from subscriptions to our print and digital products makes up a majority of our total revenue.
Subscription revenue is sensitive to discretionary spending available to subscribers in the markets we serve, as well as
economic conditions. To the extent poor economic conditions lead consumers to reduce spending on discretionary
activities, our ability to retain current and obtain new subscribers could be hindered, thereby reducing our
subscription revenue. In addition, the growth rate of new subscriptions to our news products that are driven by
significant news events, such as an election, may not be sustainable.
Print subscriptions have declined over the last several years, primarily due to increased competition from
digital media formats (which are often free to users), higher subscription rates and a growing preference among
certain consumers to receive all or a portion of their news from sources other than a print newspaper. If we are unable
to offset continued revenue declines resulting from falling print subscriptions with revenue from home-delivery price
increases, our print circulation revenue will be adversely affected.
Subscriptions to content provided on our digital platforms generate substantial revenue for us. Our future
growth depends upon our ability to retain and grow our digital subscription base and audience. To do so will require
us to evolve our subscription model, address changing consumer demands and developments in technology and
improve our digital product offering while continuing to deliver high-quality journalism and content that is
interesting and relevant to readers. There is no assurance that we will be able to successfully maintain and increase
our digital subscriber base or that we will be able to do so without taking steps such as reducing pricing or incurring
subscription acquisition costs that would affect our margin or profitability.
Failure to execute cost-control measures successfully could adversely affect our profitability.
Over the last several years, we have taken steps to reduce operating costs across the Company, and we plan to
continue our cost-management efforts. Some of these cost management efforts require significant up-front investment.
If we do not achieve expected savings from these efforts, our total operating costs would be greater than anticipated.
In addition, if we do not manage cost-management efforts properly, such efforts may affect the quality of our products
and therefore our ability to generate future revenues. And to the extent our cost-management efforts result in
reductions in staff and employee compensation and benefits, this could adversely affect our ability to attract and
retain key employees.
Significant portions of our expenses are fixed costs that neither increase nor decrease proportionately with
revenues. In addition, our ability to make short-term adjustments to manage our costs or to make changes to our
business strategy may be limited by certain of our collective bargaining agreements. If we are not able to implement
further cost-control efforts or reduce our fixed costs sufficiently in response to a decline in our revenues, our results of
operations will be adversely affected.
The underfunded status of our pension plans may adversely affect our operations, financial condition and liquidity.
We sponsor several single-employer defined benefit pension plans. Although we have frozen participation and
benefits under all but two of these qualified pension plans, our results of operations will be affected by the amount of
income or expense we record for, and the contributions we are required to make to, these plans.
We are required to make contributions to our plans to comply with minimum funding requirements imposed
by laws governing those plans. As of December 25, 2016, our qualified defined benefit pension plans were
underfunded by approximately $222 million. Our obligation to make additional contributions to our plans, and the
timing of any such contributions, depends on a number of factors, many of which are beyond our control. These
include: legislative changes; assumptions about mortality; and economic conditions, including a low interest rate
environment or sustained volatility and disruption in the stock and bond markets, which impact discount rates and
returns on plan assets.
P. 8 – THE NEW YORK TIMES COMPANY
As a result of these required contributions, we may have less cash available for working capital and other
corporate uses, which may have an adverse impact on our results of operations, financial condition and liquidity.
Our participation in multiemployer pension plans may subject us to liabilities that could materially adversely affect
our results of operations, financial condition and cash flows.
We participate in, and make periodic contributions to, various multiemployer pension plans that cover many of
our current and former production and delivery union employees. Our required contributions to these plans could
increase because of a shrinking contribution base as a result of the insolvency or withdrawal of other companies that
currently contribute to these plans, the inability or failure of withdrawing companies to pay their withdrawal liability,
low interest rates, lower than expected returns on pension fund assets or other funding deficiencies. Our withdrawal
liability for any multiemployer pension plan will depend on the nature and timing of any triggering event and the
extent of that plan’s funding of vested benefits.
If a multiemployer pension plan in which we participate has significant underfunded liabilities, such
underfunding will increase the size of our potential withdrawal liability. In addition, under federal pension law,
special funding rules apply to multiemployer pension plans that are classified as “endangered,” “critical” or “critical
and declining.” If plans in which we participate are in critical status, benefit reductions may apply and/or we could
be required to make additional contributions.
We have recorded significant withdrawal liabilities with respect to multiemployer pension plans in which we
formerly participated (primarily in connection with the sales of the New England and the Regional Media Groups)
and may record additional liabilities in the future. In addition, we have recorded withdrawal liabilities for actual and
estimated partial withdrawals from several plans in which we continue to participate. Until demand letters from
some of the multiemployer plans’ trustees are received, the exact amount of the withdrawal liability will not be fully
known and, as such, a difference from the recorded estimate could have an adverse effect on our results of operations,
financial condition and cash flows. Several of the multiemployer plans in which we participate are specific to the
newspaper industry, which continues to undergo significant pressure. A withdrawal by a significant percentage of
participants may result in a mass withdrawal declaration by the trustees of one or more of these plans, which would
require us to record additional withdrawal liabilities.
If, in the future, we elect to withdraw from these plans or if we trigger a partial withdrawal due to declines in
contribution base units or a partial cessation of our obligation to contribute, additional liabilities would need to be
recorded that could have an adverse effect on our business, results of operations, financial condition or cash flows.
Acquisitions, divestitures, investments and other transactions could adversely affect our costs, revenues,
profitability and financial position.
In order to position our business to take advantage of growth opportunities, we engage in discussions, evaluate
opportunities and enter into agreements for possible acquisitions, divestitures, investments and other transactions.
We may also consider the acquisition of, or investment in, specific properties, businesses or technologies that fall
outside our traditional lines of business and diversify our portfolio, including those that may operate in new and
developing industries, if we deem such properties sufficiently attractive. In 2016, for example, we acquired
HelloSociety and Fake Love, two digital marketing agencies, as well as product review and recommendation websites
The Wirecutter and The Sweethome.
Acquisitions involve significant risks, including:
• difficulties in integrating acquired operations (including cultural challenges associated with integrating
employees from the acquired company into our organization);
• diversion of management attention from other business concerns or resources;
• use of resources that are needed in other parts of our business;
• possible dilution of our brand or harm to our reputation;
•
•
the potential loss of key employees;
risks associated with integrating financial reporting and internal control systems; and
• other unanticipated problems and liabilities.
THE NEW YORK TIMES COMPANY – P. 9
Competition for certain types of acquisitions, particularly digital properties, is significant. Even if successfully
negotiated, closed and integrated, certain acquisitions or investments may prove not to advance our business strategy
and may fall short of expected return on investment targets, which would adversely affect our business, results of
operations and financial condition.
We have made investments in companies, and we may make similar investments in the future. Investments in
these businesses subject us to the operating and financial risks of these businesses and to the risk that we do not have
sole control over the operations of these businesses. Our investments are generally illiquid and the absence of a
market may inhibit our ability to dispose of them. In addition, if the book value of an investment were to exceed its
fair value, we would be required to recognize an impairment charge related to the investment.
Security breaches and other network and information systems disruptions could affect our ability to conduct our
business effectively.
Our online systems store and process confidential subscriber, employee and other sensitive personal data, and
therefore maintaining our network security is of critical importance. We use third-party technology and systems for a
variety of operations, including encryption and authentication technology, employee email, domain name
registration, content delivery to customers, back-office support and other functions. Our systems, and those of third
parties upon which our business relies, may be vulnerable to interruption or damage that can result from natural
disasters, fires, power outages, acts of terrorism or other similar events, or from deliberate attacks such as computer
hacking, computer viruses, worms or other destructive or disruptive software, process breakdowns, denial of service
attacks, malicious social engineering or other malicious activities, or any combination of the foregoing.
We have implemented controls and taken other preventative measures designed to strengthen our systems
against attacks, including measures designed to reduce the impact of a security breach at our third-party vendors.
Although the costs of the controls and other measures we have taken to date have not had a material effect on our
financial condition, results of operations or liquidity, there can be no assurance as to the costs of additional controls
and measures that we may conclude are necessary in the future.
There can also be no assurance that the actions, measures and controls we have implemented will be effective
against future attacks or be sufficient to prevent a future security breach or other disruption to our network or
information systems, or those of our third-party providers. Such an event could result in a disruption of our services
or improper disclosure of personal data or confidential information, which could harm our reputation, require us to
expend resources to remedy such a security breach or defend against further attacks, divert management’s attention
and resources or subject us to liability under laws that protect personal data, resulting in increased operating costs or
loss of revenue.
Our international operations expose us to economic and other risks inherent in foreign operations.
We have news bureaus and other offices around the world, and our print, web and mobile products are
generally available globally. We are focused on further expanding the international scope of our business, and face the
inherent risks associated with doing business abroad, including:
• effectively managing and staffing foreign operations, including complying with local laws and regulations in
each different jurisdiction;
• ensuring the safety and security of our journalists and other employees working in foreign locations;
• navigating local customs and practices;
• government policies and regulations that restrict the digital flow of information, which could block access to,
or the functionality of, our products;
• protecting and enforcing our intellectual property rights under varying legal regimes;
•
complying with international laws and regulations, including those governing consumer privacy and the
collection, use, retention, sharing and security of consumer data;
• economic uncertainty, volatility in local markets and political or social instability;
•
restrictions on foreign ownership, foreign investment or repatriation of funds;
• higher-than-anticipated costs of entry; and
P. 10 – THE NEW YORK TIMES COMPANY
•
currency exchange rate fluctuations.
Adverse developments in any of these areas could have an adverse impact on our business, financial condition
and results of operations. We may, for example, incur increased costs necessary to comply with existing and newly
adopted laws and regulations or penalties for any failure to comply. In addition, we have limited experience in
developing and marketing our digital products in international regions and could be at a disadvantage compared
with local and multinational competitors.
A significant number of our employees are unionized, and our business and results of operations could be adversely
affected if labor agreements were to further restrict our ability to maximize the efficiency of our operations.
Approximately half of our full-time equivalent work force is unionized. As a result, we are required to negotiate
the wages, salaries, benefits, staffing levels and other terms with many of our employees collectively. Our results
could be adversely affected if future labor negotiations or contracts were to further restrict our ability to maximize the
efficiency of our operations. If we are unable to negotiate labor contracts on reasonable terms, or if we were to
experience labor unrest or other business interruptions in connection with labor negotiations or otherwise, our ability
to produce and deliver our products could be impaired. In addition, our ability to make adjustments to control
compensation and benefits costs, change our strategy or otherwise adapt to changing business needs may be limited
by the terms and duration of our collective bargaining agreements.
Our brand and reputation are key assets of the Company, and negative perceptions or publicity could adversely affect
our business, financial condition and results of operations.
The New York Times brand is a key asset of the Company, and we believe that it has contributed significantly to
the success of our business. We also believe that our continued success depends on our ability to preserve, grow and
leverage the value of our brand. We believe that we have a powerful and trusted brand with an excellent reputation
for high-quality journalism and content, but our brand could be damaged by incidents that erode consumer trust. For
example, to the extent consumers perceive the quality of our content to be less reliable, our ability to attract readers
and advertisers may be hindered. In addition, we may introduce new products or services that users do not like and
which may negatively affect our brand. We also may fail to provide adequate customer service, which could erode
confidence in our brand. Our reputation could also be damaged by failures of third-party vendors we rely on in many
contexts. Maintaining and enhancing our brand may require us to make significant investments, which may not be
successful. To the extent our brand and reputation are damaged by these or other incidents, our revenues and
profitability could be adversely affected.
Our business may suffer if we cannot protect our intellectual property.
Our business depends on our intellectual property, including our valuable brands, content, services and
internally developed technology. We believe our proprietary trademarks and other intellectual property rights are
important to our continued success and our competitive position. Unauthorized parties may attempt to copy or
otherwise unlawfully obtain and use our content, services, technology and other intellectual property, and we cannot
be certain that the steps we have taken to protect our proprietary rights will prevent any misappropriation or
confusion among consumers and merchants, or unauthorized use of these rights.
Advancements in technology have made the unauthorized duplication and wide dissemination of content
easier, making the enforcement of intellectual property rights more challenging. In addition, as our business and the
risk of misappropriation of our intellectual property rights have become more global in scope, we may not be able to
protect our proprietary rights in a cost-effective manner in a multitude of jurisdictions with varying laws.
If we are unable to procure, protect and enforce our intellectual property rights, including maintaining and
monetizing our intellectual property rights to our content, we may not realize the full value of these assets, and our
business and profitability may suffer. In addition, if we must litigate in the United States or elsewhere to enforce our
intellectual property rights or determine the validity and scope of the proprietary rights of others, such litigation may
be costly and divert the attention of our management. In addition, if we must take actions, including litigation, in the
United States or elsewhere to enforce our intellectual property rights or determine the validity and scope of the
proprietary rights of others, such actions may be costly and divert the attention of our management.
THE NEW YORK TIMES COMPANY – P. 11
Legislative and regulatory developments, including with respect to privacy, could adversely affect our business.
Our business is subject to government regulation in the jurisdictions in which we operate, and our websites,
which are available worldwide, may be subject to laws regulating the Internet even in jurisdictions where we do not
do business. Among others, we are subject to laws and regulations with respect to online privacy and the collection
and use of consumer data. Various federal and state laws and regulations, as well as the laws of foreign jurisdictions
in which we operate, govern the collection, use, retention, sharing and security of the data we receive from and about
our readers. Failure to protect confidential customer data or to provide customers with adequate notice of our privacy
policies could subject us to liabilities imposed by these jurisdictions.
Existing privacy-related laws and regulations are evolving and subject to potentially differing interpretations,
and various federal and state legislative and regulatory bodies, as well as foreign legislative and regulatory bodies,
may expand current or enact new laws regarding privacy and data security-related matters. We may incur increased
costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to
comply.
In addition, any failure, or perceived failure, by us to comply with our posted privacy policies or with any data-
related requirements could result in claims against us by governmental entities or others and/or increased costs to
change our practices. They could also result in negative publicity and a loss of confidence in us by our readers and
advertisers. All of these potential consequences could adversely affect our business and results of operations.
We have been, and may be in the future, subject to claims of intellectual property infringement that could adversely
affect our business.
We periodically receive claims from third parties alleging infringement, misappropriation or other violations of
their intellectual property rights. These third parties often include patent holding companies seeking to monetize
patents they have purchased or otherwise obtained through asserting claims of infringement or misuse. Even if we
believe that these claims of intellectual property infringement are without merit, defending against the claims can be
time-consuming, be expensive to litigate or settle, and cause diversion of management attention.
These intellectual property infringement claims, if successful, may require us to enter into royalty or licensing
agreements on unfavorable terms, use more costly alternative technology or otherwise incur substantial monetary
liability. Additionally, these claims may require us to significantly alter certain of our operations. The occurrence of
any of these events as a result of these claims could result in substantially increased costs or otherwise adversely
affect our business.
A significant increase in the price of newsprint, or significant disruptions in our newsprint supply chain, would have
an adverse effect on our operating results.
The cost of raw materials, of which newsprint is the major component, represented approximately 5% of our
total operating costs in 2016. The price of newsprint has historically been volatile and, while the price has decreased
over the last several years, the price increased in 2016 due to declining newsprint supply as a result of paper mill
closures and conversions to other grades of paper. The price of newsprint could further increase as a result of various
factors, including a reduction in the number of suppliers due to restructurings, bankruptcies and consolidations and
other factors that adversely impact supplier profitability, including increases in operating expenses caused by raw
material and energy costs, and currency volatility.
In addition, we rely on our suppliers for deliveries of newsprint. The availability of our newsprint supply may
be affected by various factors, including labor unrest, transportation issues and other disruptions that may affect
deliveries of newsprint.
If newsprint prices increase significantly or we experience significant disruptions in the availability of our
newsprint supply in the future, our operating results will be adversely affected.
We may not have access to the capital markets on terms that are acceptable to us or may otherwise be limited in our
financing options.
From time to time the Company may need or desire to access the long-term and short-term capital markets to
obtain financing. The Company’s access to, and the availability of, financing on acceptable terms and conditions in
the future will be impacted by many factors, including, but not limited to: (1) the Company’s financial performance,
(2) the Company’s credit ratings or absence of a credit rating, (3) liquidity of the overall capital markets and (4) the
P. 12 – THE NEW YORK TIMES COMPANY
state of the economy. There can be no assurance that the Company will continue to have access to the capital markets
on terms acceptable to it.
In addition, macroeconomic conditions, such as continued or increased volatility or disruption in the credit
markets, could adversely affect our ability to obtain financing to support operations or to fund acquisitions or other
capital-intensive initiatives.
Our Class B Common Stock is principally held by descendants of Adolph S. Ochs, through a family trust, and this
control could create conflicts of interest or inhibit potential changes of control.
We have two classes of stock: Class A Common Stock and Class B Common Stock. Holders of Class A Common
Stock are entitled to elect 30% of the Board of Directors and to vote, with holders of Class B Common Stock, on the
reservation of shares for equity grants, certain material acquisitions and the ratification of the selection of our
auditors. Holders of Class B Common Stock are entitled to elect the remainder of the Board of Directors and to vote
on all other matters. Our Class B Common Stock is principally held by descendants of Adolph S. Ochs, who
purchased The Times in 1896. A family trust holds approximately 90% of the Class B Common Stock. As a result, the
trust has the ability to elect 70% of the Board of Directors and to direct the outcome of any matter that does not
require a vote of the Class A Common Stock. Under the terms of the trust agreement, the trustees are directed to retain
the Class B Common Stock held in trust and to vote such stock against any merger, sale of assets or other transaction
pursuant to which control of The Times passes from the trustees, unless they determine that the primary objective of
the trust can be achieved better by the implementation of such transaction. Because this concentrated control could
discourage others from initiating any potential merger, takeover or other change of control transaction that may
otherwise be beneficial to our businesses, the market price of our Class A Common Stock could be adversely affected.
Adverse results from litigation or governmental investigations can impact our business practices and operating
results.
From time to time, we are party to litigation and regulatory, environmental and other proceedings with
governmental authorities and administrative agencies. See Note 18 of the Notes to the Consolidated Financial
Statements regarding certain matters. Adverse outcomes in lawsuits or investigations could result in significant
monetary damages or injunctive relief that could adversely affect our results of operations or financial condition as
well as our ability to conduct our business as it is presently being conducted. In addition, regardless of merit or
outcome, such proceedings can have an adverse impact on the Company as a result of legal costs, diversion of
management and other personnel, and other factors.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
THE NEW YORK TIMES COMPANY – P. 13
ITEM 2. PROPERTIES
Our principal executive offices are located in our New York headquarters building in the Times Square area.
The building was completed in 2007 and consists of approximately 1.54 million gross square feet, of which
approximately 828,000 gross square feet of space have been allocated to us. We owned a leasehold condominium
interest representing approximately 58% of the New York headquarters building until March 2009, when we entered
into an agreement to sell and simultaneously lease back 21 floors, or approximately 750,000 rentable square feet,
currently occupied by us (the “Condo Interest”). The sale price for the Condo Interest was $225.0 million. The lease
term is 15 years, and we have three renewal options that could extend the term for an additional 20 years. We have an
option exercisable in 2019 to repurchase the Condo Interest for $250.0 million, and we currently expect that we will
exercise this option.We continue to own a leasehold condominium interest in seven floors in our New York
headquarters building, totaling approximately 216,000 rentable square feet that were not included in the sale-
leaseback transaction, all of which are currently leased to third parties.
In December 2016, we announced a plan to consolidate the Company’s operations in our headquarters building
from the 17 floors we currently occupy to nine by the end of 2017. We plan to lease the remaining eight floors to third
parties. This will require the temporary relocation of a number of employees to office space elsewhere in New York
while we reconfigure the space. We believe this plan will further enhance the value of our headquarters building.
In addition, we have a printing and distribution facility with 570,000 gross square feet located in College Point,
N.Y., on a 31-acre site owned by the City of New York for which we have a ground lease. We have an option to
purchase the property at any time before the lease ends in 2019 for $6.9 million. As of December 25, 2016, we also
owned other properties with an aggregate of approximately 3,000 gross square feet and leased other properties with
an aggregate of approximately 209,200 rentable square feet in various locations.
ITEM 3. LEGAL PROCEEDINGS
We are involved in various legal actions incidental to our business that are now pending against us. These
actions are generally for amounts greatly in excess of the payments, if any, that may be required to be made. See Note
18 of the Notes to the Consolidated Financial Statements for a description of certain matters, which is incorporated
herein by reference. Although the Company cannot predict the outcome of these matters, it is possible that an
unfavorable outcome in one or more matters could be material to the Company’s consolidated results of operations or
cash flows for an individual reporting period. However, based on currently available information, management does
not believe that the ultimate resolution of these matters, individually or in the aggregate, is likely to have a material
effect on the Company’s financial position.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
P. 14 – THE NEW YORK TIMES COMPANY
EXECUTIVE OFFICERS OF THE REGISTRANT
Name
Arthur Sulzberger, Jr.
Mark Thompson
Age
65
59
Employed By
Registrant Since
1978
2012
James M. Follo
57
2007
R. Anthony Benten
53
1989
Diane Brayton
48
2004
Meredith Kopit Levien
45
2013
Recent Position(s) Held as of February 21, 2017
Chairman (since 1997) and Publisher of The Times (since 1992);
Chief Executive Officer (2011 to 2012)
President and Chief Executive Officer (since 2012); Director-
General, British Broadcasting Corporation (“BBC”) (2004 to
2012); Chief Executive, Channel 4 Television Corporation (2002
to 2004); and various positions of increasing responsibility at
the BBC (1979 to 2001)
Executive Vice President (since 2013) and Chief Financial
Officer (since 2007); Senior Vice President (2007 to 2013); Chief
Financial and Administrative Officer, Martha Stewart Living
Omnimedia, Inc. (2001 to 2006)
Senior Vice President, Treasurer (since December 2016) and
Corporate Controller (since 2007); Senior Vice President,
Finance (2008 to 2016); Vice President (2003 to 2008); Treasurer
(2001 to 2007)
Executive Vice President, General Counsel (since January 2017)
and Corporate Secretary (since 2011); Deputy General Counsel
(2016); Assistant Secretary (2009 to 2011) and Assistant General
Counsel (2009 to 2016); Senior Counsel (2007 to 2009); Counsel
(2004 to 2007)
Executive Vice President and Chief Revenue Officer (since
2015); Executive Vice President, Advertising (2013 to 2015);
Chief Revenue Officer, Forbes Media LLC (2011 to 2013); Senior
Vice President and Group Publisher, Forbes Magazine Group
(2010 to 2011); Vice President and Publisher, ForbesLife and
ForbesWoman.com (2008 to 2010); and various positions of
increasing responsibility at Atlantic Media Company (2001 to
2008)
THE NEW YORK TIMES COMPANY – P. 15
PART II
ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
MARKET INFORMATION
The Class A Common Stock is listed on the New York Stock Exchange. The Class B Common Stock is unlisted
and is not actively traded.
The number of security holders of record as of February 15, 2017, was as follows: Class A Common Stock: 6,092;
Class B Common Stock: 24.
We have paid quarterly dividends of $0.04 per share on the Class A and Class B Common Stock since late 2013.
We currently expect to continue to pay comparable cash dividends in the future, although changes in our dividend
program may be considered by our Board of Directors in light of our earnings, capital requirements, financial
condition and other factors considered relevant. In addition, our Board of Directors will consider restrictions in any
existing indebtedness. See also “Item 7 — Management’s Discussion and Analysis of Financial Condition and Results
of Operations — Liquidity and Capital Resources — Third-Party Financing.”
The following table sets forth, for the periods indicated, the high and low closing sales prices for the Class A
Common Stock as reported on the New York Stock Exchange.
Quarters
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
2016
2015
High
Low
High
$
13.74
$
12.25
$
14.45
$
13.12
13.17
14.10
11.80
11.54
10.80
14.46
13.75
14.25
Low
12.02
12.81
11.62
11.56
ISSUER PURCHASES OF EQUITY SECURITIES(1)
Total number of
shares of Class A
Common Stock
purchased
(a)
Average
price paid
per share of
Class A
Common Stock
(b)
Total number of
shares of Class A
Common Stock
purchased
as part of
publicly
announced plans
or programs
(c)
Maximum
number (or
approximate
dollar value)
of shares of
Class A
Common
Stock that may
yet be
purchased
under the plans
or programs
(d)
— $
— $
— $
— $
—
—
—
—
— $
— $
— $
— $
16,236,612
16,236,612
16,236,612
16,236,612
Period
September 26, 2016 - October 30, 2016
October 31, 2016 - November 27, 2016
November 28, 2016 - December 25, 2016
Total for the fourth quarter of 2016
(1) On January 13, 2015, the Board of Directors approved an authorization of $101.1 million to repurchase shares of the Company’s Class A
Common Stock. As of December 25, 2016, repurchases under this authorization totaled $84.9 million (excluding commissions), and $16.2
million remained under this authorization. All purchases were made pursuant to our publicly announced share repurchase program. Our
Board of Directors has authorized us to purchase shares from time to time, subject to market conditions and other factors. There is no
expiration date with respect to this authorization.
P. 16 – THE NEW YORK TIMES COMPANY
PERFORMANCE PRESENTATION
The following graph shows the annual cumulative total stockholder return for the five fiscal years ended
December 25, 2016, on an assumed investment of $100 on December 25, 2011, in the Company, the Standard & Poor’s
S&P 400 MidCap Stock Index and the Standard & Poor’s S&P 1500 Publishing and Printing Index. Stockholder return
is measured by dividing (a) the sum of (i) the cumulative amount of dividends declared for the measurement period,
assuming reinvestment of dividends, and (ii) the difference between the issuer’s share price at the end and the
beginning of the measurement period, by (b) the share price at the beginning of the measurement period. As a result,
stockholder return includes both dividends and stock appreciation.
Stock Performance Comparison Between the S&P 400 Midcap Index, S&P 1500 Publishing & Printing Index
and The New York Times Company’s Class A Common Stock
THE NEW YORK TIMES COMPANY – P. 17
ITEM 6. SELECTED FINANCIAL DATA
The Selected Financial Data should be read in conjunction with “Item 7 — Management’s Discussion and
Analysis of Financial Condition and Results of Operations” and the Consolidated Financial Statements and the
related Notes in Item 8. The results of operations for the New England Media Group, which was sold in 2013, as well
as for the Regional Media Group and the About Group, which were sold in 2012, have been presented as discontinued
operations for all periods presented (see Note 13 of the Notes to the Consolidated Financial Statements). The pages
following the table show certain items included in Selected Financial Data. All per share amounts on those pages are
on a diluted basis. Fiscal year 2012 comprised 53 weeks and all other fiscal years presented in the table below
comprised 52 weeks.
(In thousands)
December 25,
2016
December 27,
2015
December 28,
2014
December 29,
2013
December 30,
2012
(52 Weeks)
(52 Weeks)
(52 Weeks)
(52 Weeks)
(53 Weeks)
As of and for the Years Ended
—
—
47,657
2,620
103,654
214,775
2,936
62,808
Statement of Operations Data
Revenues
Operating costs
Restructuring charge
Multiemployer pension plan withdrawal expense
Pension settlement expense
Early termination charge and other expenses
$
1,555,342
$
1,579,215
$
1,588,528
$
1,577,230
$
1,595,341
1,410,910
1,393,246
1,484,505
1,411,744
1,441,410
14,804
6,730
21,294
—
—
9,055
40,329
—
—
—
9,525
2,550
—
6,171
3,228
—
Operating profit
101,604
136,585
91,948
156,087
Gain on sale of investments, net of impairments
(Loss)/gain from joint ventures
—
(36,273)
—
(783)
Interest expense, net
34,805
39,050
—
(8,368)
53,730
—
(3,215)
58,073
Income from continuing operations before income
taxes
Income from continuing operations, net of income
taxes
(Loss)/income from discontinued operations, net of
income taxes
Net income attributable to The New York Times
Company common stockholders
Balance Sheet Data
30,526
96,752
29,850
94,799
258,557
26,105
62,842
33,391
56,907
163,940
(2,273)
—
(1,086)
7,949
(27,927)
29,068
63,246
33,307
65,105
135,847
Cash, cash equivalents and marketable securities
$
737,526
$
904,551
$
981,170
$
1,023,780
$
959,754
Property, plant and equipment, net
596,743
632,439
665,758
713,356
773,469
Total assets
2,185,395
2,417,690
2,566,474
2,572,552
2,807,470
Total debt and capital lease obligations
246,978
Total New York Times Company stockholders’ equity
847,815
431,228
826,751
650,120
726,328
684,163
842,910
696,875
662,325
P. 18 – THE NEW YORK TIMES COMPANY
(In thousands, except ratios, per share
and employee data)
December 25,
2016
December 27,
2015
December 28,
2014
December 29,
2013
December 30,
2012
(52 Weeks)
(52 Weeks)
(52 Weeks)
(52 Weeks)
(53 Weeks)
As of and for the Years Ended
Per Share of Common Stock
Basic earnings/(loss) per share attributable to The New York Times Company common stockholders:
0.19
$
0.38
$
0.23
$
0.38
$
1.11
Income from continuing operations
(Loss)/income from discontinued operations, net
of income taxes
Net income
$
$
(0.01)
—
(0.01)
0.18
$
0.38
$
0.22
Diluted earnings/(loss) per share attributable to The New York Times Company common stockholders:
Income from continuing operations
(Loss)/income from discontinued operations, net
of income taxes
Net income
Dividends declared per share
New York Times Company stockholders’ equity per
share
$
$
$
$
0.19
$
0.38
$
0.21
(0.01)
0.18
0.16
5.21
$
$
$
—
0.38
0.16
4.97
$
$
$
(0.01)
0.20
0.16
4.50
0.05
0.43
0.36
0.05
0.41
0.08
5.34
$
$
$
$
$
(0.19)
0.92
1.07
(0.18)
0.89
—
4.34
$
$
$
$
$
Average basic shares outstanding
Average diluted shares outstanding
Key Ratios
Operating profit to revenues
Return on average common stockholders’ equity
Return on average total assets
Total debt and capital lease obligations to total
capitalization
Current assets to current liabilities
Ratio of earnings to fixed charges
Full-Time Equivalent Employees
161,128
162,817
164,390
166,423
150,673
161,323
149,755
157,774
148,147
152,693
7%
3%
1%
23%
2.00
2.37
3,710
9%
8%
3%
34%
1.53
2.90
3,560
6%
4%
1%
47%
1.91
1.67
3,588
10%
9%
2%
45%
3.36
2.58
3,529
6%
23%
5%
51%
3.30
4.94
5,363
The items below are included in the Selected Financial Data.
2016
The items below had a net unfavorable effect on our results from continuing operations of $65.4 million, or $.40
per share:
• a $37.5 million pre-tax loss ($22.8 million after tax and net of noncontrolling interest, or $.14 per share) from
joint ventures related to the announced closure of the paper mill operated by Madison Paper Industries, in
which the Company has an investment through a subsidiary.
• a $21.3 million pre-tax pension settlement charge ($12.8 million after tax, or $.08 per share) in connection with
lump-sum payments made under an immediate pension benefits offer to certain former employees.
• an $18.8 million pre-tax charge ($11.3 million after tax, or $.07 per share) for severance costs.
• $15.9 million of pre-tax expenses ($9.5 million after tax, or $.06 per share) for non-operating retirement costs.
• a $14.8 million pre-tax charge ($8.8 million after tax, or $.05 per share) in connection with the streamlining of
the Company’s international print operations (primarily consisting of severance costs).
THE NEW YORK TIMES COMPANY – P. 19
• a $6.7 million pre-tax charge ($4.0 million after tax or $.02 per share) for a partial withdrawal obligation under
a multiemployer pension plan following an unfavorable arbitration decision.
• a $3.8 million income tax benefit ($.02 per share) primarily due to a reduction in the Company’s reserve for
uncertain tax positions.
2015
The items below had a net unfavorable effect on our results from continuing operations of $54.1 million, or $.32
per share:
• a $40.3 million pre-tax pension settlement charge ($24.0 million after tax, or $.14 per share) in connection with
lump-sum payments made under an immediate pension benefits offer to certain former employees.
• $34.4 million of pre-tax expenses ($20.5 million after tax, or $.12 per share) for non-operating retirement costs.
• a $9.1 million pre-tax charge ($5.4 million after tax, or $.03 per share) for partial withdrawal obligations under
multiemployer pension plans.
• a $7.0 million pre-tax charge ($4.2 million after tax, or $.03 per share) for severance costs.
2014
The items below had a net unfavorable effect on our results from continuing operations of $35.1 million, or $.22
per share:
• $36.7 million of pre-tax expenses ($21.7 million after tax, or $.13 per share) for non-operating retirement costs.
• a $36.1 million pre-tax charge ($21.4 million after tax, or $.13 per share) for severance costs.
• a $21.1 million income tax benefit ($.13 per share) primarily due to reductions in the Company’s reserve for
uncertain tax positions.
• a $9.5 million pre-tax pension settlement charge ($5.7 million after tax, or $.04 per share) in connection with
lump-sum payments made under an immediate pension benefits offer to certain former employees.
• a $9.2 million pre-tax charge ($5.9 million after tax or $.04 per share) for an impairment related to the
Company’s investment in a joint venture.
• a $2.6 million pre-tax charge ($1.5 million after tax, or $.01 per share) for the early termination of a
distribution agreement.
2013
The items below had a net unfavorable effect on our results from continuing operations of $25.2 million, or $.16
per share:
• $20.8 million of pre-tax expenses ($12.3 million after tax, or $.08 per share) for non-operating retirement costs.
• a $12.4 million pre-tax charge ($7.3 million after tax, or $.05 per share) for severance costs.
• a $6.2 million pre-tax charge ($3.7 million after tax, or $.02 per share) for a partial withdrawal obligation
under multiemployer pension plans.
• a $3.2 million pre-tax pension settlement charge ($1.9 million after tax, or $.01 per share) in connection with
lump-sum payments under an immediate pension benefit offer to certain former employees.
2012 (53-week fiscal year)
The items below had a net favorable effect on our results from continuing operations of $69.2 million, or $.45
per share:
• a $220.3 million pre-tax gain ($134.7 million after tax, or $.87 per share) on the sales of our remaining
ownership interest in Indeed.com and our remaining units in Fenway Sports Group.
• a $47.7 million pre-tax pension settlement charge ($27.7 million after tax, or $.18 per share) in connection with
lump-sum payments made under an immediate pension benefit offer to certain former employees.
• $44.5 million of pre-tax expenses ($25.9 million after tax, or $.17 per share) for non-operating retirement costs.
P. 20 – THE NEW YORK TIMES COMPANY
• a $12.3 million pre-tax charge ($7.2 million after tax, or $.04 per share) for severance costs.
• a $5.5 million pre-tax, non-cash charge ($3.2 million after tax, or $.02 per share) for the impairment of certain
investments, primarily related to our investment in Ongo Inc.
• a $2.6 million pre-tax charge ($1.5 million after tax, or $.01 per share) in connection with a legal settlement.
THE NEW YORK TIMES COMPANY – P. 21
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis provides information that management believes is relevant to an
assessment and understanding of our consolidated financial condition as of December 25, 2016, and results of
operations for the three years ended December 25, 2016. This item should be read in conjunction with our
Consolidated Financial Statements and the related Notes included in this Annual Report.
EXECUTIVE OVERVIEW
We are a global media organization that includes newspapers, print and digital products and investments. We
have one reportable segment with businesses that include our newspapers, websites, mobile applications and related
businesses.
We generate revenues principally from circulation and advertising. Other revenues primarily consist of
revenues from news services/syndication, digital archives, rental income, our NYT Live business, e-commerce and
affiliate referrals. Our main operating costs are employee-related costs.
In the accompanying analysis of financial information, we present certain information derived from
consolidated financial information but not presented in our financial statements prepared in accordance with
generally accepted accounting principles in the United States of America (“GAAP”). We are presenting in this report
supplemental non-GAAP financial performance measures that exclude depreciation, amortization, severance, non-
operating retirement costs and certain identified special items, as applicable. These non-GAAP financial measures
should not be considered in isolation from or as a substitute for the related GAAP measures, and should be read in
conjunction with financial information presented on a GAAP basis. For further information and reconciliations of
these non-GAAP measures to the most directly comparable GAAP measures, see “—Results of Operations—Non-
GAAP Financial Measures.”
2016 Financial Highlights
In 2016, diluted earnings per share from continuing operations were $0.19, compared with $0.38 for 2015.
Diluted earnings per share from continuing operations excluding severance, non-operating retirement costs and
special items discussed below (or “adjusted diluted earnings per share,” a non-GAAP measure) were $0.57 for 2016,
compared with $0.71 for 2015.
Operating profit in 2016 was $101.6 million, compared with $136.6 million for 2015. The decline was driven by
lower print advertising revenue and higher costs. Operating profit before depreciation, amortization, severance, non-
operating retirement costs and special items discussed below (or “adjusted operating profit,” a non-GAAP measure)
was $240.9 million for 2016, compared with $289.0 million for 2015.
Total revenues decreased slightly in 2016 to $1.56 billion, compared with $1.58 billion in 2015. This was driven
by declines in advertising revenues, partially offset by growth in circulation and other revenues.
Compared with 2015, circulation revenues increased 3.4% in 2016, as digital subscription growth and a print
home-delivery price increase at The Times more than offset a decline in the number of print copies sold. Circulation
revenues from our digital-only subscription packages increased 17% in 2016 compared with 2015.
Paid digital-only subscriptions totaled approximately 1,853,000 as of December 25, 2016, a 46% increase
compared with year-end 2015. We saw a significant increase in the number of paid digital-only subscriptions to our
news products following the 2016 presidential election. Given that this increase occurred late in 2016, the revenue
generated from these subscriptions is expected to be reflected more fully in 2017.
Advertising revenues remained under pressure during 2016. Total advertising revenues decreased 9.1% in 2016
compared with 2015, reflecting a 15.8% decrease in print advertising revenues that was primarily driven by a decline
in display advertising. This was partially offset by a 5.9% increase in digital advertising revenues that was primarily
driven by increased revenue from our mobile platform, our programmatic buying channels and branded content
distribution.
Compared with 2015, other revenues increased 6.0% in 2016, largely due to affiliate referral revenue associated
with product review and recommendation websites, The Wirecutter and The Sweethome, which the Company
acquired in October 2016, as well as from our NYT Live business.
P. 22 – THE NEW YORK TIMES COMPANY
Operating costs in 2016 increased 1.3% to $1.41 billion, compared with $1.39 billion in 2015. The increase was
primarily due to higher advertising, technology, marketing and newsroom costs, partially offset by lower print
production and distribution costs. Operating costs before depreciation, amortization, severance and non-operating
retirement costs discussed below (or “adjusted operating costs,” a non-GAAP measure) increased 1.9% to $1.31 billion
in 2016, compared with $1.29 billion in 2015.
Non-operating retirement costs decreased to $15.9 million in 2016 from $34.4 million in 2015, driven primarily
by a change in the methodology of calculating the discount rate applied to retirement costs.
Business Environment
We believe that a number of factors and industry trends have had, and will continue to have, an adverse effect
on our business and prospects. These include the following:
Competition in our industry
We operate in a highly competitive environment. Our print and digital products compete for advertising and
circulation revenue with both traditional and new content providers. Competition among companies offering online
content is intense, and new competitors can quickly emerge. Some of our current and potential competitors may have
greater resources than we do, which may allow them to compete more effectively than us.
Our ability to compete effectively depends on, among other things, our ability to continue delivering high-
quality journalism and content that is interesting and relevant to our audience; the popularity, ease of use and
performance of our products compared to those of our competitors; the engagement of our current readers with our
print and digital products, and our ability to reach new readers; our ability to develop, maintain and monetize our
products; our ability to attract, retain and motivate talented employees, including journalists and product and
technology specialists; and our ability to manage and grow our business in a cost-effective manner.
Continuing shift to digital from print
Circulation revenue is a significant source of revenue for us and an increasingly important driver as the overall
composition of our revenues has shifted in response to transformations in our industry. The largest portion of our
circulation revenue is currently from our print newspaper, where we have experienced declining print circulation
volume in recent years. This is due to, among other factors, increased competition from digital media formats (which
are often free to users), higher print subscription and single-copy rates and a growing preference among some
consumers to receive their news from sources other than a print newspaper.
Advances in technology have led to an increased number of methods for the delivery and consumption of news
and other content. These developments are also driving changes in the preferences and expectations of consumers as
they seek more control over how they consume content. Our ability to retain and continue to build on our digital
subscription base depends on, among other things, our ability to evolve our subscription model, address changing
consumer demands and developments in technology and improve our digital product offering while continuing to
deliver high-quality journalism and content that is interesting and relevant to readers.
Advertising market dynamics
We derive substantial revenue from the sale of advertising in our print and digital products. In determining
whether to buy advertising, our advertisers consider the demand for our products, demographics of our reader base,
advertising rates, results observed by advertisers, and alternative advertising options.
During 2016, the Company, along with others in the industry, continued to experience significant pressure on
print advertising revenue. Although print advertising revenue continues to represent a majority of our total
advertising revenue, the increased popularity of digital media among consumers, particularly as a source for news
and other content, has driven a corresponding shift in demand from print advertising to digital advertising. However,
our digital advertising revenue may not replace in full print advertising revenue lost as a result of the shift.
The digital advertising market continues to undergo significant changes. The increasing number of digital
media options available, including through social networking platforms and news aggregation websites, has resulted
in audience fragmentation and increased competition for advertising. Competition from new content providers and
platforms, some of which charge lower rates than we do or have greater audience reach and targeting capabilities,
and the significant increase in inventory of digital advertising space, have affected and will likely continue to affect
our ability to attract and retain advertisers and to maintain or increase our advertising rates. In addition, digital
THE NEW YORK TIMES COMPANY – P. 23
advertising networks and exchanges, real-time bidding and other programmatic buying channels that allow
advertisers to buy audiences at scale are playing a more significant role in the advertising marketplace and may cause
further downward pricing pressure.
The character of our digital advertising business also continues to change, as demand for newer forms of
advertising, such as branded content and video advertising, increases. The margin on revenues from some of these
newer advertising forms tends to be lower than the margin on revenues we generate from our print advertising and
traditional digital display advertising. Consequently, we may experience further downward pressure on our
advertising revenue margins as a greater percentage of advertising revenues comes from these newer forms.
In addition, technologies have been and will continue to be developed that enable consumers to block digital
advertising on websites and mobile devices. Advertisements blocked by these technologies are treated as not
delivered and any revenue we would otherwise receive from the advertiser for that advertisement is lost.
As the digital advertising market continues to evolve, our ability to compete successfully for advertising
budgets will depend on, among other things, our ability to engage and grow our audience and prove the value of our
advertising and the effectiveness of our platforms to advertisers.
Economic conditions
Global, national and local economic conditions affect various aspects of our business. The level of advertising
sales in any period may be affected by advertisers’ decisions to increase or decrease their advertising expenditures in
response to anticipated consumer demand and general economic conditions. Changes in spending patterns and
priorities, including shifts in marketing strategies and budget cuts of key advertisers, in response to economic
conditions, have depressed and may continue to depress our advertising revenues.
In addition, subscription revenue is sensitive to discretionary spending available to subscribers in the markets
we serve, and to the extent poor economic conditions lead consumers to reduce spending on discretionary activities,
our ability to retain current and obtain new subscribers could be hindered.
Fixed costs
A significant portion of our costs are fixed, and therefore we are limited in our ability to reduce these costs in
the short term. Employee-related costs and raw materials together accounted for approximately 50% of our total
operating costs in 2016. Changes in employee-related costs and the price and availability of newsprint can materially
affect our operating results.
For a discussion of these and other factors that could affect our business, results of operations and financial
condition, see “Item 1A — Risk Factors.”
Our Strategy
We are operating during a period of transformation for our industry and amidst uncertain economic conditions.
We anticipate that the challenges we currently face will continue, and we believe that the following elements are key
to our efforts to address them.
Strengthening The New York Times brand through innovation
Our priority is to maintain The Times’s commitment to premium content and journalistic excellence, while at
the same time positioning our organization for growth.
In 2016, we continued to invest in our digital platforms and products. Among other things, we focused on
innovating the way we tell stories, through new forms of visual and multimedia journalism, including podcasts,
interactive journalism (through Facebook Live and other initiatives) and virtual reality journalism. We also invested in
our international opportunities and in April 2016 announced our commitment to invest more than $50 million in the
digital potential of The Times internationally.
While we continue to focus on digital innovation, we remain committed to the continued success of our print
products, which we expect will continue to be a significant source of revenue for us. During 2016, for example, we
created compelling special inserts in our print newspaper on the presidential election and other events.
As we look ahead for opportunities to further innovate our products, we remain committed to creating quality
content and a quality user experience, regardless of the distribution model or platform.
P. 24 – THE NEW YORK TIMES COMPANY
Expanding and deepening our relationship with readers
We are a “subscription-first” organization and continue to focus on deepening the engagement of our current
readers and expanding our reach to new readers around the world. In 2016, we saw significant growth in digital-only
subscriptions to our news products, and earlier this year the number of total paid subscriptions to our print and
digital products surpassed three million. We believe this growth underscores the willingness of our readers to pay for
high-quality journalism, and we will continue to look for ways to strengthen the relationship we have with our
subscribers. We will also continue to focus on developing new audiences, including by expanding our global reach
and working to engage younger readers.
During the year, we continued efforts to make The Times an indispensable part of our readers’ lives. Among
others, The Times introduced or enhanced products and features that span a broad range of topics and interests,
including NYT Cooking, a dynamic recipe box designed to make cooking easier; Watching, our guide to what to
watch on television; and Well, our healthy living guide. In October 2016, the Company also purchased The Wirecutter
and The Sweethome, product review and recommendation websites that align with The Times’s commitment to
service journalism.
We also continued our efforts to engage readers around the world. Among other things, we launched The New
York Times en Español, a mobile-optimized website covering news and issues of interest to a Spanish-speaking
audience, and extended our popular Daily Briefings to Europe and Asia. In addition, we will continue to experiment
with reaching new readers on third-party platforms, while remaining committed to building engagement with
readers on our own platforms.
Creating compelling digital advertising solutions
We are focused on continuing to grow our digital advertising revenue by developing innovative and
compelling advertising offerings that integrate with and add value to the user experience. We believe we have a
powerful and trusted brand that, because of the quality of our journalism, attracts educated, affluent and influential
audiences, and we continue to focus on leveraging our brand in developing and refining these offerings.
During 2016, the digital advertising market continued to shift away from traditional desktop display
advertising and towards newer advertising forms, such as branded content and other creative services, as well as
programmatic, video and mobile advertising. We have quickly adapted to this market shift, introducing innovative
digital advertising solutions for our mobile and other platforms, and providing advertisers new ways of reaching our
audience, such as our virtual reality application. We have also continued to expand our branded content studio,
which has become a fast-growing part of our advertising business since we launched it in early 2014.
Transforming our business to deliver on our goals
We are focused on becoming a more effective and efficient organization and have taken and continue to take a
number of steps to achieve this. Among other things, we streamlined our international print operations in 2016 and
are reviewing initiatives aimed at improving newsroom efficiency. In December 2016, we also announced plans to
redesign our headquarters building, consolidating our operations within a smaller number of floors and leasing the
remaining floors to third parties. We expect the changes will generate significant rental income and result in a more
collaborative workspace.
Looking ahead, we will continue to focus on managing our cost structure to ensure that we are operating our
businesses efficiently, while maintaining our commitment to investing in high-quality content and the achievement of
strategic goals.
Strengthening our liquidity
We have continued to strengthen our liquidity position and remain focused on further de-leveraging and de-
risking our balance sheet. In December 2016, we repaid, at maturity, the remaining principal amount of our senior
notes. As of December 25, 2016, the Company had cash and cash equivalents and marketable securities of
approximately $738 million (excluding restricted cash of approximately $25 million, the majority of which is set aside
to collateralize certain workers’ compensation obligations). This exceeded our total debt and capital lease obligations
by approximately $491 million. We believe our cash balance and cash provided by operations, in combination with
other sources of cash, will be sufficient to meet our financing needs over the next 12 months.
THE NEW YORK TIMES COMPANY – P. 25
In March 2009, we entered into an agreement to sell and simultaneously lease back a portion of our leasehold
condominium interest in our Company’s headquarters building located at 620 Eighth Avenue in New York City (the
“Condo Interest”). The sale price for the Condo Interest was $225.0 million less transaction costs, for net proceeds of
approximately $211 million. We have an option, exercisable in 2019, to repurchase the Condo Interest for $250.0
million, and we currently expect to exercise this option. We believe that exercising this option will provide us greater
flexibility with respect to our headquarters building.
Managing our retirement-related costs
We remain focused on managing the underfunded status of our pension plans and adjusting the size of our
pension obligations relative to the size of our Company. Our qualified pension plans were underfunded (meaning the
present value of future benefits obligations exceeded the fair value of plan assets) as of December 25, 2016, by
approximately $222 million, compared with approximately $273 million as of December 27, 2015. We made
contributions of approximately $8 million to certain qualified pension plans in 2016, compared with approximately $7
million in 2015. We expect contributions in 2017 to total approximately $9 million to satisfy minimum funding
requirements.
We have taken steps over the last few years to address our pension obligations, including freezing accruals
under most of our qualified defined benefit pension plans, which cover both our non-union employees and those
covered by certain collective bargaining agreements. We have also made immediate pension benefits offers in the
form of lump-sum payments to certain former employees and will continue to look for ways to reduce the size of our
pension obligations.
While we have made significant progress in our liability-driven investment strategy to reduce the funding
volatility of our qualified pension plans, the size of our pension plan obligations relative to the size of our current
operations will continue to have a significant impact on our reported financial results. We expect to continue to
experience volatility in our retirement-related costs, including pension, multiemployer pension and retiree medical
costs.
P. 26 – THE NEW YORK TIMES COMPANY
RESULTS OF OPERATIONS
Overview
Fiscal years 2016, 2015, and 2014 each comprise 52 weeks. The following table presents our consolidated
financial results:
(In thousands)
Revenues
Circulation
Advertising
Other
Total revenues
Operating costs
Production costs:
Wages and benefits
Raw materials
Other
Total production costs
Selling, general and administrative costs
Depreciation and amortization
Total operating costs
Restructuring charge
Multiemployer pension plan withdrawal expense
Pension settlement charge
Early termination charge
Operating profit
Loss from joint ventures
Interest expense, net
Income from continuing operations before income taxes
Income tax expense/(benefit)
Income from continuing operations
Loss from discontinued operations, net of income taxes
Net income
Net loss attributable to the noncontrolling interest
Net income attributable to The New York Times Company
common stockholders
* Represents an increase or decrease in excess of 100%.
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
$
880,543
$
851,790
$
840,213
580,732
638,709
662,315
94,067
88,716
86,000
1,555,342
1,579,215
1,588,528
363,051
354,516
357,573
72,325
192,728
628,104
721,083
61,723
77,176
186,120
617,812
713,837
61,597
88,958
197,464
643,995
761,055
79,455
1,410,910
1,393,246
1,484,505
14,804
6,730
21,294
—
—
9,055
40,329
—
—
—
9,525
2,550
3.4
(9.1)
6.0
(1.5)
2.4
(6.3)
3.6
1.7
1.0
0.2
1.3
100.0
(25.7)
(47.2)
1.4
(3.6)
3.2
(0.6)
(0.9)
(13.2)
(5.7)
(4.1)
(6.2)
(22.5)
(6.1)
*
*
*
*
(100.0)
101,604
136,585
91,948
(25.6)
48.5
(36,273)
(783)
(8,368)
*
34,805
30,526
4,421
26,105
(2,273)
23,832
5,236
39,050
96,752
33,910
62,842
53,730
29,850
(3,541)
33,391
(10.9)
(68.4)
(87.0)
(58.5)
(90.6)
(27.3)
*
*
88.2
—
(1,086)
100.0
(100.0)
62,842
32,305
(62.1)
94.5
404
1,002
*
(59.7)
$
29,068
$
63,246
$
33,307
(54.0)
89.9
THE NEW YORK TIMES COMPANY – P. 27
Revenues
Circulation, advertising and other revenues were as follows:
(In thousands)
Circulation
Advertising
Other
Total
Circulation Revenues
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
$
880,543
$
851,790
$
840,213
580,732
638,709
662,315
94,067
88,716
86,000
$
1,555,342
$
1,579,215
$
1,588,528
3.4
(9.1)
6.0
(1.5)
1.4
(3.6)
3.2
(0.6)
Circulation revenues consist of revenues from our print and digital products, including our digital-only
subscription packages, e-readers and replica editions. These revenues are based on the number of copies of the
printed newspaper sold (through home-delivery subscriptions and single-copy and bulk sales) and digital-only
subscriptions and the rates charged to the respective customers. All print home-delivery subscribers receive unlimited
digital access.
In the first quarter of 2016, the Company reclassified the subscription revenue from its Crossword product,
including prior period information, into circulation revenues from other revenues. The following tables summarize
digital-only subscription revenues reflecting this reclassification:
(In thousands)
Digital-only subscription revenues:
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
Digital-only news product subscription revenues
Digital Crossword product subscription revenues
Total
$
$
223,459
$
192,657
$
169,297
9,369
6,286
3,391
232,828
$
198,943
$
172,688
16.0
49.0
17.0
13.8
85.4
15.2
Consistent with this reclassification, the Company also adjusted the number of digital-only subscriptions to
include Crossword product subscriptions. The following tables summarize digital-only subscriptions:
(In thousands)
Digital-only subscriptions:
Digital-only news product subscriptions
Digital Crossword product subscriptions
Total
2016 Compared with 2015
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
1,608
245
1,853
1,094
176
1,270
910
141
1,051
47.0
39.2
45.9
20.2
24.8
20.8
Circulation revenues increased in 2016 compared with 2015 primarily due to growth in our digital-only
subscription base and the January 2016 print home-delivery price increase for The Times, partially offset by a
reduction in the number of print copies sold. Digital-only subscription revenues were $232.8 million in 2016
compared with $198.9 million in 2015, an increase of 17.0%.
P. 28 – THE NEW YORK TIMES COMPANY
2015 Compared with 2014
Circulation revenues increased in 2015 compared with 2014 primarily due to growth in our digital-only
subscription base and the January 2015 print home-delivery price increase for The Times, partially offset by a
reduction in the number of print copies sold. Digital-only subscription revenues were $198.9 million in 2015
compared with $172.7 million in 2014, an increase of 15.2%.
Advertising Revenues
Advertising revenues are derived from the sale of our advertising products and services on our print, web and
mobile platforms. These revenues are primarily determined by the volume, rate and mix of advertisements. Display
advertising revenue is principally from advertisers promoting products, services or brands in print in the form of
column-inch ads, and on our web and mobile platforms in the form of banners, video, rich media and other
interactive ads. Display advertising also includes branded content on The Times’s platforms. Classified advertising
revenue includes line-ads sold in the major categories of real estate, help wanted, automotive and other. Other
advertising revenue primarily includes creative services fees associated with, among other things, our branded
content studio; revenue from preprinted advertising, also known as free-standing inserts; and revenue generated from
branded bags in which our newspapers are delivered.
Advertising revenues (print and digital) by category were as follows:
(In thousands)
Display
Classified
Other
Total
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
$
517,197
$
579,153
$
606,838
29,902
33,633
34,544
25,012
36,689
18,788
$
580,732
$
638,709
$
662,315
(10.7)
(13.4)
34.5
(9.1)
(4.6)
(5.8)
33.1
(3.6)
Below is a percentage breakdown of 2016, 2015 and 2014 advertising revenues (print and digital):
2016
2015
2014
2016 Compared with 2015
Display
Classified
Other
Total
89%
91%
91%
5%
5%
6%
6%
4%
3%
100%
100%
100%
In 2016, total advertising revenues decreased primarily due to lower print advertising revenues. Print
advertising revenues, which represented 64% of total advertising revenues in 2016, declined 15.8% to $372.0 million in
2016 compared with $441.6 million in 2015, mainly due to a decline in display advertising, primarily in the luxury
goods, entertainment retail and technology categories.
Digital advertising revenues, which represented 36% of total advertising revenues in 2016, increased 5.9% to
$208.8 million in 2016 compared with $197.1 million in 2015 due to an increase in revenue from our mobile platform,
our programmatic buying channels and branded content distribution. Revenues from HelloSociety and Fake Love,
digital marketing agencies acquired in 2016, also contributed favorably to this increase. This increase was partially
offset by a decline in traditional desktop display advertising.
Classified advertising revenues decreased 13.4% in 2016 compared with 2015 due to a decrease in the real
estate, help wanted and other categories.
Other advertising revenues increased 34.5% in 2016 compared with 2015 due to an increase in creative services
fees related to branded content campaign launches during 2016.
THE NEW YORK TIMES COMPANY – P. 29
2015 Compared with 2014
In 2015, total advertising revenues decreased primarily due to lower print advertising revenues. Print
advertising revenues, which represented 69% of total advertising revenues in 2015, declined 8.0% to $441.6 million in
2015 compared with $480.1 million in 2014, mainly due to a decline in display advertising, primarily in the financial
services, entertainment and corporate categories. The decline was partially offset by an increase in the luxury goods,
real estate and technology categories.
Digital advertising revenues, which represented 31% of total advertising revenues in 2015, increased 8.2% to
$197.1 million in 2015 compared with $182.2 million in 2014 due to an increase in display advertising. Display
advertising benefited strongly from increased revenue from branded content as well as increased revenue from our
mobile and video platforms and our programmatic buying channels. These increases were partially offset by a decline
in traditional desktop display advertising.
Classified advertising revenues decreased 5.8% in 2015 compared with 2014 due to a decrease in the real estate
and help wanted categories.
Other advertising revenues increased 33.1% in 2015 compared with 2014 due to an increase in creative services
fees.
Other Revenues
Other revenues primarily consist of revenues from news services/syndication, digital archives, rental income,
our NYT Live business, e-commerce and affiliate referrals. Rental income consists of revenue from the lease of floors
in our New York headquarters, which totaled $17.1 million, $16.9 million and $14.7 million in 2016, 2015 and 2014,
respectively.
2016 Compared with 2015
Other revenues increased 6.0% in 2016 compared with 2015 largely due to affiliate referral revenue associated
with our acquisition in October 2016 of the product review and recommendation websites The Wirecutter and The
Sweethome, as well as from our NYT Live business.
2015 Compared with 2014
Other revenues increased 3.2% in 2015 compared with 2014 due to higher revenues from digital archives and
rental income.
P. 30 – THE NEW YORK TIMES COMPANY
Operating Costs
Operating costs were as follows:
(In thousands)
Production costs:
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
Wages and benefits
$
363,051
$
354,516
$
357,573
Raw materials
Other
Total production costs
Selling, general and administrative costs
Depreciation and amortization
72,325
192,728
628,104
721,083
61,723
77,176
186,120
617,812
713,837
61,597
88,958
197,464
643,995
761,055
79,455
Total operating costs
$
1,410,910
$
1,393,246
$
1,484,505
The components of operating costs as a percentage of total operating costs were as follows:
2.4
(6.3)
3.6
1.7
1.0
0.2
1.3
(0.9)
(13.2)
(5.7)
(4.1)
(6.2)
(22.5)
(6.1)
Components of operating costs as a percentage of total operating costs
Wages and benefits
Raw materials
Other operating costs
Depreciation and amortization
Total
Years Ended
December 25,
2016
December 27,
2015
December 28,
2014
45%
5%
46%
4%
44%
6%
46%
4%
44%
6%
45%
5%
100%
100%
100%
The components of operating costs as a percentage of total revenues were as follows:
Components of operating costs as a percentage of total revenues
Wages and benefits
Raw materials
Other operating costs
Depreciation and amortization
Total
Years Ended
December 25,
2016
December 27,
2015
December 28,
2014
41%
5%
41%
4%
91%
39%
5%
40%
4%
88%
41%
5%
42%
5%
93%
THE NEW YORK TIMES COMPANY – P. 31
Production Costs
Production costs include items such as labor costs, raw materials and machinery and equipment expenses
related to news-gathering and production activity, as well as costs related to producing branded content.
2016 Compared with 2015
Production costs increased in 2016 compared with 2015 primarily due to higher wages and benefits
(approximately $9 million) and other expenses (approximately $7 million), which consisted mainly of outside services
(approximately $9 million) and travel and entertainment (approximately $2 million), offset by lower outside printing
expenses (approximately $5 million). Newsprint expense declined 6.6% in 2016 compared with 2015, with 6.1% from
lower consumption and 0.5% from lower pricing.
2015 Compared with 2014
Production costs decreased in 2015 compared with 2014 primarily due to lower raw materials expense
(approximately $12 million), which consisted mainly of newsprint and outside printing expenses (approximately $8
million). Newsprint expense declined 20.3% in 2015 compared with 2014, with 7.4% from lower consumption and
12.9% from lower pricing.
Selling, General and Administrative Costs
Selling, general and administrative costs include costs associated with the selling, marketing and distribution of
products as well as administrative expenses.
2016 Compared with 2015
Selling, general and administrative costs increased in 2016 compared with 2015 primarily due to an increase in
severance costs (approximately $12 million), compensation costs (approximately $11 million) and promotion costs
(approximately $8 million), partially offset by a decrease in non-operating retirement costs (approximately $19
million) and distribution costs (approximately $6 million). Compensation costs increased primarily as a result of
increased hiring to support growth initiatives and business acquisitions. Distribution costs decreased primarily as a
result of fewer print copies produced and lower transportation costs.
2015 Compared with 2014
Selling, general and administrative costs decreased in 2015 compared with 2014 primarily due to a decrease in
severance costs (approximately $29 million) and lower distribution costs (approximately $17 million), partially offset
by an increase in compensation expense (approximately $6 million). Severance costs decreased as a result of
workforce reductions in 2014 that did not repeat in 2015. Lower distribution costs were mainly due to increased use of
lower cost vendors, transportation efficiencies and fewer print copies delivered. Compensation expense increased
primarily as a result of increased hiring to support growth initiatives.
Depreciation and Amortization
2016 Compared with 2015
Depreciation and amortization costs were flat in 2016 compared with 2015.
2015 Compared with 2014
Depreciation and amortization costs decreased in 2015 compared with 2014 primarily due to the discontinued
use of certain software products.
Other Items
See Note 7 of the Notes to the Consolidated Financial Statements for more information regarding other items.
P. 32 – THE NEW YORK TIMES COMPANY
NON-OPERATING ITEMS
Investments in Joint Ventures
See Note 5 of the Notes to the Consolidated Financial Statements for information regarding our joint venture
investments.
Interest Expense, Net
See Note 6 of the Notes to the Consolidated Financial Statements for information regarding interest expense.
Income Taxes
See Note 12 of the Notes to the Consolidated Financial Statements for information regarding income taxes.
Discontinued Operations
See Note 13 of the Notes to the Consolidated Financial Statements for information regarding discontinued
operations.
Non-GAAP Financial Measures
We have included in this report certain supplemental financial information derived from consolidated financial
information but not presented in our financial statements prepared in accordance with GAAP. Specifically, we have
referred to the following non-GAAP financial measures in this report:
• diluted earnings per share from continuing operations excluding severance, non-operating retirement costs
and the impact of special items (or adjusted diluted earnings per share from continuing operations);
• operating profit before depreciation, amortization, severance, non-operating retirement costs and special items
(or adjusted operating profit); and
• operating costs before depreciation, amortization, severance and non-operating retirement costs (or adjusted
operating costs).
The special items in 2016 consisted of:
•
•
a $37.5 million pre-tax loss ($22.8 million after tax and net of noncontrolling interest, or $.14 per share) from
joint ventures related to the announced closure of the paper mill operated by Madison Paper Industries, in
which the Company has an investment through a subsidiary;
a $21.3 million pre-tax pension settlement charge ($12.8 million after tax, or $.08 per share) in connection with
lump-sum payments made under an immediate pension benefits offer to certain former employees;
• a $14.8 million pre-tax charge ($8.8 million after tax, or $.05 per share) in connection with the streamlining of
the Company’s international print operations (primarily consisting of severance costs);
• a $6.7 million pre-tax charge ($4.0 million after tax, or $.02 per share) for a partial withdrawal obligation under
a multiemployer pension plan following an unfavorable arbitration decision; and
• a $3.8 million income tax benefit ($.02 per share) primarily due to a reduction in the Company’s reserve for
uncertain tax positions.
The special items in 2015 consisted of:
• a $40.3 million pre-tax pension settlement charge ($24.0 million after tax, or $.14 per share) in connection with
lump-sum payments made under an immediate pension benefits offer to certain former employees; and
• a $9.1 million pre-tax charge ($5.4 million after tax, or $.03 per share) for partial withdrawal obligations under
multiemployer pension plans.
THE NEW YORK TIMES COMPANY – P. 33
The special items in 2014 consisted of:
• a $21.1 million income tax benefit ($.13 per share) primarily due to reductions in the Company’s reserve for
uncertain tax positions;
• a $9.5 million pre-tax pension settlement charge ($5.7 million after tax, or $.04 per share) in connection with
lump-sum payments made under an immediate pension benefits offer to certain former employees;
• a $9.2 million pre-tax charge ($5.9 million after tax, or $.04 per share) for an impairment related to the
Company’s investment in a joint venture; and
• a $2.6 million pre-tax charge ($1.5 million after tax, or $.01 per share) for the early termination of a distribution
agreement.
We have included these non-GAAP financial measures because management reviews them on a regular basis
and uses them to evaluate and manage the performance of our operations. We believe that, for the reasons outlined
below, these non-GAAP financial measures provide useful information to investors as a supplement to reported
diluted earnings/(loss) per share from continuing operations, operating profit/(loss) and operating costs. However,
these measures should be evaluated only in conjunction with the comparable GAAP financial measures and should not
be viewed as alternative or superior measures of GAAP results.
Adjusted diluted earnings per share provides useful information in evaluating our period-to-period
performance because it eliminates items that we do not consider to be indicative of earnings from ongoing operating
activities. Adjusted operating profit is useful in evaluating the ongoing performance of our businesses as it excludes
the significant non-cash impact of depreciation and amortization as well as items not indicative of ongoing operating
activities. Total operating costs include depreciation, amortization, severance and non-operating retirement costs.
Adjusted operating costs, which exclude these items, provide investors with helpful supplemental information on our
underlying operating costs that is used by management in its financial and operational decision-making.
Management considers special items, which may include impairment charges, pension settlement charges and
other items that arise from time to time, to be outside the ordinary course of our operations. Management believes that
excluding these items provides a better understanding of the underlying trends in the Company’s operating
performance and allows more accurate comparisons of the Company’s operating results to historical performance. In
addition, management excludes severance costs, which may fluctuate significantly from quarter to quarter, because it
believes these costs do not necessarily reflect expected future operating costs and do not contribute to a meaningful
comparison of the Company’s operating results to historical performance.
Non-operating retirement costs include:
•
interest cost, expected return on plan assets and amortization of actuarial gain and loss components of pension
expense;
•
interest cost and amortization of actuarial gain and loss components of retiree medical expense; and
• all expenses associated with multiemployer pension plan withdrawal obligations not otherwise included as
special items.
These non-operating retirement costs are primarily tied to financial market performance and changes in market
interest rates and investment performance. Non-operating retirement costs do not include service costs and
amortization of prior service costs for pension and retiree medical benefits, which we believe reflect the ongoing
operating costs of providing pension and retiree medical benefits to our employees. We consider non-operating
retirement costs to be outside the performance of our ongoing core business operations and believe that presenting
operating results excluding non-operating retirement costs, in addition to our GAAP operating results, provides
increased transparency and a better understanding of the underlying trends in our operating business performance.
P. 34 – THE NEW YORK TIMES COMPANY
Reconciliations of non-GAAP financial measures from, respectively, diluted earnings per share from continuing
operations, operating profit and operating costs, the most directly comparable GAAP items, as well as details on the
components of non-operating retirement costs, are set out in the tables below.
Reconciliation of diluted earnings per share from continuing operations excluding severance, non-operating retirement costs and
special items (or adjusted diluted earnings per share from continuing operations)
Diluted earnings per share from continuing operations
$
0.19
$
0.38
$
0.21
-50.0%
81.0%
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
Add:
Severance
Non-operating retirement costs
Special items:
Loss in joint ventures, net of tax and noncontrolling interest
Pension settlement charges
Restructuring charge
Multiemployer pension plan withdrawal expense
Reduction in reserve for uncertain tax positions
Early termination charge
Impairment charge
0.12
0.10
0.18
0.13
0.09
0.04
(0.02)
—
—
0.04
0.21
—
0.24
—
0.05
—
—
—
0.22
0.23
*
-81.8%
-52.4%
-8.7%
*
*
*
*
—
*
0.06
-45.8%
*
-20.0%
—
—
(0.13)
0.02
0.06
*
*
*
-100.0%
-100.0%
-100.0%
Income tax expense of special items
(0.26)
(0.22)
(0.24)
18.2%
-8.3%
Adjusted diluted earnings per share from continuing
operations (1)
(1) Amounts may not add due to rounding.
* Represents an increase or decrease in excess of 100%.
$
0.57
$
0.71
$
0.43
-19.7%
65.1%
THE NEW YORK TIMES COMPANY – P. 35
Reconciliation of operating profit before depreciation & amortization, severance, non-operating retirement costs and special items (or
adjusted operating profit)
(In thousands)
Operating profit
Add:
Depreciation & amortization
Severance
Non-operating retirement costs
Special items:
Restructuring charge
Multiemployer pension plan withdrawal expense
Pension settlement charges
Early termination charge
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
$
101,604
$
136,585
$
91,948
(25.6)%
48.5 %
61,723
18,829
15,880
14,804
6,730
21,294
—
61,597
7,035
34,383
—
9,055
40,329
79,455
0.2%
(22.5%)
36,082
*
(80.5%)
36,697
(53.8)%
(6.3)%
—
—
*
(25.7)%
9,525
(47.2)%
*
*
*
—
2,550
*
(100.0)%
Adjusted operating profit
$
240,864
$
288,984
$
256,257
(16.7)%
12.8 %
Reconciliation of operating costs before depreciation & amortization, severance and non-operating retirement costs (or adjusted
operating costs)
(In thousands)
Operating costs
Less:
Depreciation & amortization
Severance
Non-operating retirement costs
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
$
1,410,910
$
1,393,246
$
1,484,505
1.3 %
(6.1)%
61,723
18,829
15,880
61,597
7,035
34,383
79,455
0.2%
(22.5%)
36,082
*
(80.5%)
36,697
(53.8)%
(6.3)%
Adjusted operating costs
$
1,314,478
$ 1,290,231
$
1,332,271
1.9 %
(3.2)%
* Represents an increase or decrease in excess of 100%.
P. 36 – THE NEW YORK TIMES COMPANY
Components of non-operating retirement costs (1)
(In thousands)
Pension:
Interest cost
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
$
74,465
$
84,596
$
94,897
(12.0)%
(10.9)%
Expected return on plan assets
(111,159)
(115,261)
(113,839)
(3.6%)
1.2%
Amortization and other costs
Non-operating pension costs
Other postretirement benefits:
Interest cost
Amortization and other costs
Non-operating other postretirement benefits costs
Expenses associated with multiemployer pension plan
withdrawal obligations
32,489
(4,205)
1,980
4,104
6,084
41,523
10,858
2,794
5,197
7,991
31,338
(21.8)%
32.5 %
12,396
*
(12.4%)
3,722
7,299
(29.1%)
(24.9%)
(21.0)%
(28.8)%
11,021
(23.9%)
(27.5%)
14,001
15,534
13,280
(9.9)%
17.0 %
Total non-operating retirement costs
$
15,880
$
34,383
$
36,697
(53.8)%
(6.3)%
(1) Components of non-operating retirement costs do not include special items.
* Represents an increase or decrease in excess of 100%.
THE NEW YORK TIMES COMPANY – P. 37
LIQUIDITY AND CAPITAL RESOURCES
Overview
The following table presents information about our financial position.
Financial Position Summary
(In thousands, except ratios)
Cash and cash equivalents
Marketable securities
Current portion of long-term debt and capital lease obligations
Long-term debt and capital lease obligations
Total New York Times Company stockholders’ equity
Ratios:
December 25,
2016
December 27,
2015
2016 vs. 2015
% Change
$
100,692
$
105,776
636,834
—
246,978
847,815
798,775
188,377
242,851
826,751
(4.8)
(20.3)
(100.0)
1.7
2.5
Total debt and capital lease obligations to total capitalization
Current assets to current liabilities
23%
2.00
34%
1.53
Our primary sources of cash inflows from operations were revenues from circulation and advertising sales.
Circulation and advertising revenues provided about 57% and 37%, respectively, of total revenues in 2016. The
remaining cash inflows were primarily from other revenue sources such as news services/syndication, digital
archives, rental income, our NYT Live business, e-commerce and affiliate referrals.
Our primary sources of cash outflows were for our repayment of debt, employee compensation and benefits,
other operating expenses and interest, dividend and income tax payments. We believe our cash and cash equivalents,
and marketable securities balance and cash provided by operations, in combination with other sources of cash, will be
sufficient to meet our financing needs over the next 12 months.
We have continued to strengthen our liquidity position and our debt profile. As of December 25, 2016, we had
cash, cash equivalents and marketable securities of $737.5 million and total debt and capital lease obligations of $247.0
million. Accordingly, our cash, cash equivalents and marketable securities exceeded total debt and capital lease
obligations by $490.5 million. Our cash and investment balances declined in 2016 primarily due to the repayment, at
maturity, of the $189.2 million remaining principal amount under our 6.625% senior notes in December 2016 (the
“6.625% Notes”) and consideration paid for business acquisitions.
On January 14, 2015, entities controlled by Carlos Slim Helú, a beneficial owner of our Class A Common Stock,
exercised warrants to purchase 15.9 million shares of our Class A Common Stock at a price of $6.3572 per share, and
the Company received cash proceeds of approximately $101.1 million from this exercise. Concurrently, the Board of
Directors terminated an existing authorization to repurchase shares of the Company’s Class A Common Stock and
approved a new repurchase authorization of $101.1 million, equal to the cash proceeds received by the Company from
the warrant exercise. As of December 25, 2016, total repurchases under this authorization totaled $84.9 million
(excluding commissions) and $16.2 million remained under this authorization. Our Board of Directors has authorized
us to purchase shares from time to time, subject to market conditions and other factors. There is no expiration date
with respect to this authorization.
We have paid quarterly dividends of $0.04 per share on the Class A and Class B Common Stock since late 2013.
We currently expect to continue to pay comparable cash dividends in the future, although changes in our dividend
program will be considered by our Board of Directors in light of our earnings, capital requirements, financial
condition and other factors considered relevant. In addition, the Board of Directors will consider restrictions in any
existing indebtedness.
During 2016, we made contributions of approximately $8 million to certain qualified pension plans. We expect
contributions to total approximately $9 million to satisfy minimum funding requirements in 2017.
P. 38 – THE NEW YORK TIMES COMPANY
In March 2016, UPM, the Company’s partner in the Madison joint venture investment, announced the closure of
Madison’s paper mill, which occurred in May 2016. As a result of this closure, we recognized $41.4 million in losses
from joint ventures, wrote our investment down to zero and recorded a liability of $28.3 million, reflecting both our
share of the impairment and losses incurred in 2016 by Madison and our funding obligation. These amounts are
presented in “Accrued expenses and other” in our Consolidated Balance Sheets. The Company’s joint venture in
Madison is currently being liquidated and a plan is in place to sell assets (including hydro power assets) at the mill
site. In the fourth quarter of 2016, Madison sold its non-hydro power assets at the mill site and we recognized a gain
of $3.9 million related to the sale. We expect the sale of the hydro power assets to be completed in early 2017 and
believe the proceeds from the sale will be more than sufficient to cover Madison’s obligations and therefore allow us
to reverse our liability. See Note 5 of the Notes to the Consolidated Financial Statements for more information on this
joint venture investment, including summarized financial information.
Capital Resources
Sources and Uses of Cash
Cash flows provided by/(used in) by category were as follows:
(In thousands)
Operating activities
Investing activities
Financing activities
* Represents an increase or decrease in excess of 100%.
Operating Activities
Years Ended
% Change
December 25,
2016
December 27,
2015
December 28,
2014
2016 vs.
2015
2015 vs.
2014
$
$
$
94,247
128,272
(227,395)
$
$
$
175,326
(30,703)
(214,211)
$
$
$
80,491
(46.2)
*
(324,717)
(517.8)
(90.5)
(61,386)
6.2
*
Cash from operating activities is generated by cash receipts from circulation, advertising sales and other
revenue. Operating cash outflows include payments for employee compensation, pension and other benefits, raw
materials, interest and income taxes.
Net cash provided by operating activities decreased in 2016 compared with 2015 due to higher income tax
payments, higher employee compensation payments, higher marketing costs and an overall decline in revenues. We
made income tax payments of approximately $45 million in 2016 compared with approximately $21 million in 2015.
Net cash provided by operating activities increased in 2015 compared with 2014 due to an increase in operating
performance, lower pension contributions and lower interest payments.
Investing Activities
Cash from investing activities generally includes proceeds from marketable securities that have matured and
the sale of assets, investments or a business. Cash used in investing activities generally includes purchases of
marketable securities, payments for capital projects, restricted cash (the majority of which is set aside to collateralize
workers’ compensation obligations), acquisitions of new businesses and investments.
Net cash provided by investing activities in 2016 was primarily due to maturities of marketable securities, offset
by purchases of marketable securities and a cash distribution of $38.0 million from the liquidation of certain
investments related to our corporate-owned life insurance, consideration paid for acquisitions of $40.4 million and
payments for capital expenditures of $30.1 million.
Net cash used in investing activities in 2015 was primarily due to maturities of marketable securities, offset by
purchases of marketable securities and payments for capital expenditures.
Net cash used in investing activities in 2014 was primarily due to purchases of marketable securities, payments
for capital expenditures and changes in restricted cash. Additionally during 2014, net cash used in investing activities
included the repayment of approximately $26 million of loans taken against the cash value of our corporate-owned
life insurance policies.
THE NEW YORK TIMES COMPANY – P. 39
Payments for capital expenditures were approximately $30.0 million, $27.0 million and $35.0 million in 2016,
2015 and 2014, respectively.
Financing Activities
Cash from financing activities generally includes borrowings under third-party financing arrangements, the
issuance of long-term debt and funds from stock option exercises. Cash used in financing activities generally includes
the repayment of amounts outstanding under third-party financing arrangements, the payment of dividends and the
payment of long-term debt and capital lease obligations.
Net cash used in financing activities in 2016 was primarily related to the repayment, at maturity, of the $189.2
million remaining principal amount under our 6.625% Notes, dividend payments of $25.9 million and share
repurchases of $15.7 million.
Net cash used in financing activities in 2015 was primarily related to the repayment, at maturity, of $223.7
million remaining under our 5.0% senior notes, share repurchases of $69.3 million and dividend payments of $26.6
million, partially offset by $101.1 million of proceeds from the exercise of warrants.
Net cash used in financing activities in 2014 was primarily due to repurchases of $18.4 million of our 6.625%
Notes and $20.4 million of our 5.0% senior notes and dividend payments of $24.9 million offset by proceeds from
stock option exercises.
See “— Third-Party Financing” below and our Consolidated Statements of Cash Flows for additional
information on our sources and uses of cash.
Restricted Cash
We were required to maintain $24.9 million of restricted cash as of December 25, 2016 and $28.7 million as of
December 27, 2015, the majority of which is set aside to collateralize workers’ compensation obligations.
Third-Party Financing
As of December 25, 2016, our current indebtedness consisted of the repurchase option related to a sale-leaseback
of a portion of our New York headquarters. See Note 6 for information regarding our total debt and capital lease
obligations. See Note 8 for information regarding the fair value of our long-term debt.
P. 40 – THE NEW YORK TIMES COMPANY
Contractual Obligations
The information provided is based on management’s best estimate and assumptions of our contractual
obligations as of December 25, 2016. Actual payments in future periods may vary from those reflected in the table.
(In thousands)
Debt(1)
Capital leases(2)
Operating leases(2)
Benefit plans(3)
Total
Payment due in
Total
2017
2018-2019
2020-2021
Later Years
$
330,353
$
27,180
$
303,173
$
— $
8,349
30,925
748,859
552
11,362
54,233
7,797
9,456
—
5,994
116,588
155,274
422,764
$
1,118,486
$
93,327
$
437,014
$
161,268
$
426,877
—
—
4,113
(1)
Includes estimated interest payments on long-term debt. See Note 6 of the Notes to the Consolidated Financial Statements for additional
information related to our debt.
(2) See Note 18 of the Notes to the Consolidated Financial Statements for additional information related to our capital and operating leases.
(3) The Company's general funding policy with respect to qualified pension plans is to contribute amounts at least sufficient to satisfy the
minimum amount required by applicable law and regulations. Contributions for our qualified pension plans and future benefit payments for
our unfunded pension and other postretirement benefit payments have been estimated over a 10-year period; therefore, the amounts included
in the “Later Years” column only include payments for the period of 2022-2026. For our funded qualified pension plans, estimating funding
depends on several variables, including the performance of the plans' investments, assumptions for discount rates, expected long-term rates
of return on assets, rates of compensation increases and other factors. Thus, our actual contributions could vary substantially from these
estimates. While benefit payments under these plans are expected to continue beyond 2026, we have included in this table only those benefit
payments estimated over the next 10 years. Benefit plans in the table above also include estimated payments for multiemployer pension plan
withdrawal liabilities. See Notes 9 and 10 of the Notes to the Consolidated Financial Statements for additional information related to our
pension and other postretirement benefits plans.
“Other Liabilities — Other” in our Consolidated Balance Sheets include liabilities related to (1) deferred
compensation, primarily related to our deferred executive compensation plan (the “DEC”), (2) uncertain tax positions
and (3) various other liabilities. These liabilities are not included in the table above primarily because the future
payments are not determinable.
The DEC enables certain eligible executives to elect to defer a portion of their compensation on a pre-tax basis.
The deferred amounts are invested at the executives’ option in various mutual funds. The fair value of deferred
compensation is based on the mutual fund investments elected by the executives and on quoted prices in active
markets for identical assets. The DEC was frozen effective December 31, 2015, and no new contributions may be made
into the plan. See Note 11 of the Notes to the Consolidated Financial Statements for additional information on “Other
Liabilities — Other.”
Our liability for uncertain tax positions was approximately $13.0 million, including approximately $4.0 million
of accrued interest and penalties as of December 25, 2016. Until formal resolutions are reached between us and the tax
authorities, the timing and amount of a possible audit settlement for uncertain tax benefits is not practicable.
Therefore, we do not include this obligation in the table of contractual obligations. See Note 12 of the Notes to the
Consolidated Financial Statements for additional information on “Income Taxes.”
We have a contract through the end of 2017 with Resolute, a major paper supplier, to purchase newsprint. The
contract requires us to purchase annually the lesser of a fixed number of tons or a percentage of our total newsprint
requirement at market rate in an arm’s length transaction. Since the quantities of newsprint purchased annually under
this contract are based on our total newsprint requirement, the amount of the related payments for these purchases is
excluded from the table above.
Off-Balance Sheet Arrangements
We did not have any material off-balance sheet arrangements as of December 25, 2016.
THE NEW YORK TIMES COMPANY – P. 41
CRITICAL ACCOUNTING POLICIES
Our Consolidated Financial Statements are prepared in accordance with GAAP. The preparation of these
financial statements requires management to make estimates and assumptions that affect the amounts reported in the
Consolidated Financial Statements for the periods presented.
We continually evaluate the policies and estimates we use to prepare our Consolidated Financial Statements. In
general, management’s estimates are based on historical experience, information from third-party professionals and
various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results may
differ from those estimates made by management.
Our critical accounting policies include our accounting for goodwill and other intangibles, retirement benefits,
income taxes and self-insurance liabilities. Specific risks related to our critical accounting policies are discussed below.
Goodwill and Intangibles
We evaluate whether there has been an impairment of goodwill or intangibles assets not amortized on an
annual basis or in an interim period if certain circumstances indicate that a possible impairment may exist.
(In thousands)
Goodwill
Intangibles
Total assets
December 25,
2016
December 27,
2015
$
$
$
134,517
10,634
2,185,395
$
$
$
109,085
—
2,417,690
Percentage of goodwill and intangibles to total assets
7%
5%
The impairment analysis is considered critical because of the significance of goodwill and intangibles to our
Consolidated Balance Sheets.
We test for goodwill impairment at the reporting unit level, which is our operating segment. We first perform a
qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less
than its carrying value. The qualitative assessment includes, but is not limited to, the results of our most recent
quantitative impairment test, consideration of industry, market and macroeconomic conditions, cost factors, cash
flows, changes in key management personnel and our share price. The result of this assessment determines whether it
is necessary to perform the goodwill impairment two-step test. For the 2016 annual impairment testing, based on our
qualitative assessment, we concluded that it is more likely than not that goodwill is not impaired.
If we determine that it is more likely than not that the fair value of our reporting unit is less than its carrying
value, in the first step we compare the fair value of the reporting unit with its carrying amount, including goodwill.
Fair value is calculated by a combination of a discounted cash flow model and a market approach model. In
calculating fair value for the reporting unit, we generally weigh the results of the discounted cash flow model more
heavily than the market approach because the discounted cash flow model is specific to our business and long-term
projections. If the fair value exceeds the carrying amount, goodwill is not considered impaired. If the carrying amount
exceeds the fair value, the second step must be performed to measure the amount of the impairment loss, if any. In the
second step, we compare the implied fair value of the reporting unit’s goodwill with the carrying amount of that
goodwill. An impairment loss would be recognized in an amount equal to the excess of the carrying amount of the
goodwill over the implied fair value of the goodwill.
Intangible assets that are not amortized (i.e., trade names) are tested for impairment at the asset level by
comparing the fair value of the asset with its carrying amount. If the fair value, which is based on future cash flows,
exceeds the carrying value, the asset is not considered impaired. If the carrying amount exceeds the fair value, an
impairment loss would be recognized in an amount equal to the excess of the carrying amount of the asset over the
fair value of the asset.
Intangible assets that are amortized (i.e., customer lists, non-competes, etc.) are tested for impairment at the
asset level associated with the lowest level of cash flows. An impairment exists if the carrying value of the asset (1) is
not recoverable (the carrying value of the asset is greater than the sum of undiscounted cash flows) and (2) is greater
than its fair value.
P. 42 – THE NEW YORK TIMES COMPANY
The discounted cash flow analysis requires us to make various judgments, estimates and assumptions, many of
which are interdependent, about future revenues, operating margins, growth rates, capital expenditures, working
capital and discount rates. The starting point for the assumptions used in our discounted cash flow analysis is the
annual long-range financial forecast. The annual planning process that we undertake to prepare the long-range
financial forecast takes into consideration a multitude of factors, including historical growth rates and operating
performance, related industry trends, macroeconomic conditions, and marketplace data, among others. Assumptions
are also made for perpetual growth rates for periods beyond the long-range financial forecast period. Our estimates of
fair value are sensitive to changes in all of these variables, certain of which relate to broader macroeconomic
conditions outside our control.
The market approach analysis includes applying a multiple, based on comparable market transactions, to
certain operating metrics of the reporting unit.
The significant estimates and assumptions used by management in assessing the recoverability of goodwill and
other intangibles are estimated future cash flows, discount rates, growth rates, as well as other factors. Any changes in
these estimates or assumptions could result in an impairment charge. The estimates, based on reasonable and
supportable assumptions and projections, require management’s subjective judgment. Depending on the assumptions
and estimates used, the estimated results of the impairment tests can vary within a range of outcomes.
In addition to annual testing, management uses certain indicators to evaluate whether the carrying value of our
reporting unit may not be recoverable and an interim impairment test may be required. These indicators include: (1)
current-period operating or cash flow declines combined with a history of operating or cash flow declines or a
projection/forecast that demonstrates continuing declines in the cash flow or the inability to improve our operations
to forecasted levels, (2) a significant adverse change in the business climate, whether structural or technological, (3)
significant impairments and (4) a decline in our stock price and market capitalization.
Management has applied what it believes to be the most appropriate valuation methodology for its impairment
testing. Additionally, management believes that the likelihood of an impairment of goodwill is remote due to the
excess market capitalization relative to its net book value. See Note 4 of the Notes to the Consolidated Financial
Statements.
Retirement Benefits
Our single-employer pension and other postretirement benefit costs and obligations are accounted for using
actuarial valuations. We recognize the funded status of these plans – measured as the difference between plan assets,
if funded, and the benefit obligation – on the balance sheet and recognize changes in the funded status that arise
during the period but are not recognized as components of net periodic pension cost, within other comprehensive
income/(loss), net of tax. The assets related to our funded pension plans are measured at fair value.
We also recognize the present value of pension liabilities associated with the withdrawal from multiemployer
pension plans.
We consider accounting for retirement plans critical to our operations because management is required to make
significant subjective judgments about a number of actuarial assumptions, which include discount rates, long-term
return on plan assets and mortality rates. These assumptions may have an effect on the amount and timing of future
contributions. Depending on the assumptions and estimates used, the impact from our pension and other
postretirement benefits could vary within a range of outcomes and could have a material effect on our Consolidated
Financial Statements.
See “— Pensions and Other Postretirement Benefits” below for more information on our retirement benefits.
Income Taxes
We consider accounting for income taxes critical to our operating results because management is required to
make significant subjective judgments in developing our provision for income taxes, including the determination of
deferred tax assets and liabilities, and any valuation allowances that may be required against deferred tax assets.
Income taxes are recognized for the following: (1) amount of taxes payable for the current year and (2) deferred
tax assets and liabilities for the future tax consequence of events that have been recognized differently in the financial
statements than for tax purposes. Deferred tax assets and liabilities are established using statutory tax rates and are
adjusted for tax rate changes in the period of enactment.
THE NEW YORK TIMES COMPANY – P. 43
We assess whether our deferred tax assets shall be reduced by a valuation allowance if it is more likely than not
that some portion or all of the deferred tax assets will not be realized. Our process includes collecting positive (i.e.,
sources of taxable income) and negative (i.e., recent historical losses) evidence and assessing, based on the evidence,
whether it is more likely than not that the deferred tax assets will not be realized.
We recognize in our financial statements the impact of a tax position if that tax position is more likely than not
of being sustained on audit, based on the technical merits of the tax position. This involves the identification of
potential uncertain tax positions, the evaluation of tax law and an assessment of whether a liability for uncertain tax
positions is necessary. Different conclusions reached in this assessment can have a material impact on the
Consolidated Financial Statements.
We operate within multiple taxing jurisdictions and are subject to audit in these jurisdictions. These audits can
involve complex issues, which could require an extended period of time to resolve. Until formal resolutions are
reached between us and the tax authorities, the timing and amount of a possible audit settlement for uncertain tax
benefits is difficult to predict.
Self-Insurance
We self-insure for workers’ compensation costs, automobile and general liability claims, up to certain
deductible limits, as well as for certain employee medical and disability benefits. The recorded liabilities for self-
insured risks are primarily calculated using actuarial methods. The liabilities include amounts for actual claims, claim
growth and claims incurred but not yet reported. Actual experience, including claim frequency and severity as well as
health-care inflation, could result in different liabilities than the amounts currently recorded. The recorded liabilities
for self-insured risks were approximately $38 million and $41 million as of December 25, 2016 and December 27, 2015,
respectively.
PENSIONS AND OTHER POSTRETIREMENT BENEFITS
We sponsor several single-employer defined benefit pension plans, the majority of which have been frozen. We
also participate in two joint Company and Guild-sponsored defined benefit pension plans covering employees who
are members of The NewsGuild of New York, including The Newspaper Guild of New York - The New York Times
Pension Fund, which was frozen in 2012 and replaced by a successor plan, The Guild-Times Adjustable Pension Plan.
Our pension liability also includes our multiemployer pension plan withdrawal obligations. Our liability for
postretirement obligations includes our liability to provide health benefits to eligible retired employees.
The table below includes the liability for all of these plans.
(In thousands)
Pension and other postretirement liabilities (includes current portion)
Total liabilities
December 25,
2016
December 27,
2015
$
$
640,650
1,341,151
$
$
714,787
1,589,235
Percentage of pension and other postretirement liabilities to total liabilities
48%
45%
Pension Benefits
Our Company-sponsored defined benefit pension plans include qualified plans (funded) as well as non-
qualified plans (unfunded). These plans provide participating employees with retirement benefits in accordance with
benefit formulas detailed in each plan. All of our non-qualified plans, which provide enhanced retirement benefits to
select employees, are currently frozen, except for a foreign-based pension plan discussed below.
Our joint Company and Guild-sponsored plans are both qualified plans and are included in the table below.
We also have a foreign-based pension plan for certain non-U.S. employees (the “foreign plan”). The information
for the foreign plan is combined with the information for U.S. non-qualified plans. The benefit obligation of the
foreign plan is immaterial to our total benefit obligation.
P. 44 – THE NEW YORK TIMES COMPANY
The funded status of our qualified and non-qualified pension plans as of December 25, 2016 is as follows:
(In thousands)
Pension obligation
Fair value of plan assets
December 25, 2016
Qualified
Plans
Non-Qualified
Plans
All Plans
$
1,798,652
$
240,399
$
2,039,051
1,576,760
—
1,576,760
Pension underfunded/unfunded obligation, net
$
(221,892)
$
(240,399)
$
(462,291)
We made contributions of approximately $8 million to certain qualified pension plans in 2016. We expect
contributions to total approximately $9 million to satisfy minimum funding requirements in 2017.
Pension expense is calculated using a number of actuarial assumptions, including an expected long-term rate of
return on assets (for qualified plans) and a discount rate. Our methodology in selecting these actuarial assumptions is
discussed below.
In determining the expected long-term rate of return on assets, we evaluated input from our investment
consultants, actuaries and investment management firms, including our review of asset class return expectations, as
well as long-term historical asset class returns. Projected returns by such consultants and economists are based on
broad equity and bond indices. Our objective is to select an average rate of earnings expected on existing plan assets
and expected contributions to the plan (less plan expenses to be incurred) during the year. The expected long-term
rate of return determined on this basis was 7.00% at the beginning of 2016. Our plan assets had an average rate of
return of approximately 10.36% in 2016 and an average annual return of approximately 6.85% over the three-year
period 2014-2016. We regularly review our actual asset allocation and periodically rebalance our investments to meet
our investment strategy.
The market-related value of plan assets is multiplied by the expected long-term rate of return on assets to
compute the expected return on plan assets, a component of net periodic pension cost. The market-related value of
plan assets is a calculated value that recognizes changes in fair value over three years.
Based on the composition of our assets at the end of the year, we estimated our 2017 expected long-term rate of
return to be 6.75%. If we had decreased our expected long-term rate of return on our plan assets by 50 basis points to
6.50% in 2016, pension expense would have increased by approximately $8 million in 2016 for our qualified pension
plans. Our funding requirements would not have been materially affected.
We determined our discount rate using a Ryan ALM, Inc. Curve (the “Ryan Curve”). The Ryan Curve provides
the bonds included in the curve and allows adjustments for certain outliers (i.e., bonds on “watch”). We believe the
Ryan Curve allows us to calculate an appropriate discount rate.
To determine our discount rate, we project a cash flow based on annual accrued benefits. For active
participants, the benefits under the respective pension plans are projected to the date of termination. The projected
plan cash flow is discounted to the measurement date, which is the last day of our fiscal year, using the annual spot
rates provided in the Ryan Curve. A single discount rate is then computed so that the present value of the benefit cash
flow equals the present value computed using the Ryan Curve rates.
The weighted-average discount rate determined on this basis was 4.31% for our qualified plans and 4.17% for
our non-qualified plans as of December 25, 2016.
If we had decreased the expected discount rate by 50 basis points for our qualified plans and our non-qualified
plans in 2016, pension expense would have increased by approximately $1 million as of December 25, 2016 and our
pension obligation would have increased by approximately $124 million.
We will continue to evaluate all of our actuarial assumptions, generally on an annual basis, and will adjust as
necessary. Actual pension expense will depend on future investment performance, changes in future discount rates,
the level of contributions we make and various other factors.
We also recognize the present value of pension liabilities associated with the withdrawal from multiemployer
pension plans. Our multiemployer pension plan withdrawal liability was approximately $113 million as of
THE NEW YORK TIMES COMPANY – P. 45
December 25, 2016. This liability represents the present value of the obligations related to complete and partial
withdrawals that have already occurred as well as an estimate of future partial withdrawals that we considered
probable and reasonably estimable. For those plans that have yet to provide us with a demand letter, the actual
liability will not be known until they complete a final assessment of the withdrawal liability and issue a demand to
us. Therefore, the estimate of our multiemployer pension plan liability will be adjusted as more information becomes
available that allows us to refine our estimates.
See Note 9 of the Notes to the Consolidated Financial Statements for additional information regarding our
pension plans.
Other Postretirement Benefits
We provide health benefits to retired employees (and their eligible dependents) who meet the definition of an
eligible participant and certain age and service requirements, as outlined in the plan document. While we offer pre-
age 65 retiree medical coverage to employees who meet certain retiree medical eligibility requirements, we do not
provide post-age 65 retiree medical benefits for employees who retired on or after March 1, 2009. We also contribute to
a postretirement plan under the provisions of a collective bargaining agreement. We accrue the costs of postretirement
benefits during the employees’ active years of service and our policy is to pay our portion of insurance premiums and
claims from our assets.
The annual postretirement expense was calculated using a number of actuarial assumptions, including a health-
care cost trend rate and a discount rate. The health-care cost trend rate was 8.00% as of December 25, 2016. A one-
percentage point change in the assumed health-care cost trend rate would result in an increase of $0.1 million or a
decrease of $0.1 million in our 2016 service and interest costs, respectively, two factors included in the calculation of
postretirement expense. A one-percentage point change in the assumed health-care cost trend rate would result in an
increase of approximately $2 million or a decrease of approximately $2 million in our accumulated benefit obligation
as of December 25, 2016. Our discount rate assumption for postretirement benefits is consistent with that used in the
calculation of pension benefits. See “— Pension Benefits” above for information on our discount rate assumption.
See Note 10 of the Notes to the Consolidated Financial Statements for additional information regarding our
other postretirement benefits.
Change in Discount Rate Methodology
For fiscal year 2016, we changed the approach used to calculate the service and interest components of net
periodic benefit cost for benefit plans to provide a more precise measurement of service and interest costs.
Historically, we calculated these service and interest components utilizing a single weighted-average discount rate
derived from the yield curve used to measure the benefit obligation at the beginning of the period. We have elected to
utilize an approach that discounts the individual expected cash flows using the applicable spot rates derived from the
yield curve over the projected cash flow period. The spot rates used to estimate 2016 service and interest costs ranged
from 1.32% to 4.79%. Service costs and interest costs for our benefit plans were reduced by approximately $19 million
due to the change in methodology.
See Notes 9 and 10 of the Notes to the Consolidated Financial Statements for more information regarding our
pension benefits and other postretirement benefits, respectively.
RECENT ACCOUNTING PRONOUNCEMENTS
See Note 2 of the Notes to the Consolidated Financial Statements for information regarding recent accounting
pronouncements.
P. 46 – THE NEW YORK TIMES COMPANY
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Our market risk is principally associated with the following:
• We do not have interest rate risk related to our debt because, as of December 25, 2016, our portfolio does not
include variable-rate debt. However, we will have fair value risk related to our fixed-rate debt if we
repurchase or exchange long-term debt prior to maturity.
• Newsprint is a commodity subject to supply and demand market conditions. Our equity investment in
Malbaie provides a substantial hedge against price volatility. The cost of raw materials, of which newsprint
expense is a major component, represented approximately 5% and 6% of our total operating costs in 2016 and
2015, respectively. Based on the number of newsprint tons consumed in 2016 and 2015, a $10 per ton increase
in newsprint prices would have resulted in additional newsprint expense of $1.0 million (pre-tax) in 2016 and
2015, but would also result in improved performance in this joint venture investment.
• The discount rate used to measure the benefit obligations for our qualified pension plans is determined by
using the Ryan Curve, which provides rates for the bonds included in the curve and allows adjustments for
certain outliers (i.e., bonds on “watch”). Broad equity and bond indices are used in the determination of the
expected long-term rate of return on pension plan assets. Therefore, interest rate fluctuations and volatility of
the debt and equity markets can have a significant impact on asset values, the funded status of our pension
plans and future anticipated contributions. See “Item 7 — Management’s Discussion and Analysis of
Financial Condition and Results of Operations — Pensions and Other Postretirement Benefits.”
• A significant portion of our employees are unionized and our results could be adversely affected if future
labor negotiations or contracts were to further restrict our ability to maximize the efficiency of our operations.
In addition, if we are unable to negotiate labor contracts on reasonable terms, or if we were to experience
labor unrest or other business interruptions in connection with labor negotiations or otherwise, our ability to
produce and deliver our products could be impaired.
See Notes 5, 6, 9 and 18 of the Notes to the Consolidated Financial Statements.
THE NEW YORK TIMES COMPANY – P. 47
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
THE NEW YORK TIMES COMPANY 2016 FINANCIAL REPORT
INDEX
PAGE
Management’s Responsibility for the Financial Statements
Management’s Report on Internal Control Over Financial Reporting
Report of Independent Registered Public Accounting Firm on Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm on Internal Control Over Financial
Reporting
Consolidated Balance Sheets as of December 25, 2016 and December 27, 2015
Consolidated Statements of Operations for the years ended December 25, 2016, December 27, 2015 and
December 28, 2014
Consolidated Statements of Comprehensive Income/(Loss) for the years ended December 25, 2016,
December 27, 2015 and December 28, 2014
Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 25, 2016,
December 27, 2015 and December 28, 2014
Consolidated Statements of Cash Flows for the years ended December 25, 2016, December 27, 2015
and December 28, 2014
Notes to the Consolidated Financial Statements
1. Basis of Presentation
2. Summary of Significant Accounting Policies
3. Marketable Securities
4. Goodwill and Intangibles
5. Investments
6. Debt Obligations
7. Other
8. Fair Value Measurements
9. Pension Benefits
10. Other Postretirement Benefits
11. Other Liabilities
12. Income Taxes
13. Discontinued Operations
14. Earnings/(Loss) Per Share
15. Stock-Based Awards
16. Stockholders’ Equity
17. Segment Information
18. Commitments and Contingent Liabilities
Schedule II – Valuation and Qualifying Accounts for the three years ended December 25, 2016
Quarterly Information (Unaudited)
P. 48 – THE NEW YORK TIMES COMPANY
49
49
50
51
52
54
56
57
58
60
60
60
66
66
67
70
71
72
73
84
88
89
91
92
93
95
97
97
99
101
REPORT OF MANAGEMENT
Management’s Responsibility for the Financial Statements
The Company’s consolidated financial statements were prepared by management, who is responsible for their
integrity and objectivity. The consolidated financial statements have been prepared in accordance with accounting
principles generally accepted in the United States of America (“GAAP”) and, as such, include amounts based on
management’s best estimates and judgments.
Management is further responsible for establishing and maintaining adequate internal control over financial
reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. The Company’s
internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. The
Company follows and continuously monitors its policies and procedures for internal control over financial reporting
to ensure that this objective is met (see “Management’s Report on Internal Control Over Financial Reporting” below).
The consolidated financial statements were audited by Ernst & Young LLP, an independent registered public
accounting firm, in 2016, 2015 and 2014. Its audits were conducted in accordance with the standards of the Public
Company Accounting Oversight Board (United States) and its report is shown on Page 50.
The Audit Committee of the Board of Directors, which is composed solely of independent directors, meets
regularly with the independent registered public accounting firm, internal auditors and management to discuss
specific accounting, financial reporting and internal control matters. Both the independent registered public
accounting firm and the internal auditors have full and free access to the Audit Committee. Each year the Audit
Committee selects, subject to ratification by stockholders, the firm which is to perform audit and other related work
for the Company.
Management’s Report on Internal Control Over Financial Reporting
Management of the Company is responsible for establishing and maintaining adequate internal control over
financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. The
Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with GAAP. The Company’s internal control over financial reporting includes those policies and procedures that:
• pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions
and dispositions of the assets of the Company;
• provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with GAAP, and that receipts and expenditures of the Company are being made
only in accordance with authorizations of management and directors of the Company; and
• provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or
disposition of the Company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies
or procedures may deteriorate.
Our management, with the participation of our principal executive officer and principal financial officer,
assessed the effectiveness of the Company’s internal control over financial reporting as of December 25, 2016. In
making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission in Internal Control — Integrated Framework (2013 framework). Based on its assessment,
management concluded that the Company’s internal control over financial reporting was effective as of December 25,
2016.
The Company’s independent registered public accounting firm, Ernst & Young LLP, that audited the
consolidated financial statements of the Company included in this Annual Report on Form 10-K, has issued an
attestation report on the Company’s internal control over financial reporting as of December 25, 2016, which is
included on Page 51 in this Annual Report on Form 10-K.
THE NEW YORK TIMES COMPANY – P. 49
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
ON CONSOLIDATED FINANCIAL STATEMENTS
To the Board of Directors and Stockholders of
The New York Times Company
We have audited the accompanying consolidated balance sheets of The New York Times Company as of
December 25, 2016 and December 27, 2015, and the related consolidated statements of operations, comprehensive
income/(loss), changes in stockholders’ equity, and cash flows for each of the three fiscal years in the period ended
December 25, 2016. Our audits also included the financial statement schedule listed at Item 15(A)(2) of The New York
Times Company’s 2016 Annual Report on Form 10-K. These financial statements and schedule are the responsibility
of The New York Times Company’s management. Our responsibility is to express an opinion on these financial
statements and schedule based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated
financial position of The New York Times Company at December 25, 2016 and December 27, 2015, and the
consolidated results of its operations and its cash flows for each of the three fiscal years in the period ended
December 25, 2016, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related
financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents
fairly in all material respects, the information set forth therein.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board
(United States), The New York Times Company’s internal control over financial reporting as of December 25, 2016,
based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (2013 framework), and our report dated February 22, 2017 expressed an
unqualified opinion thereon.
/s/ Ernst & Young LLP
New York, New York
February 22, 2017
P. 50 – THE NEW YORK TIMES COMPANY
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
ON INTERNAL CONTROL OVER FINANCIAL REPORTING
To the Board of Directors and Stockholders of
The New York Times Company
We have audited The New York Times Company’s internal control over financial reporting as of December 25,
2016, based on criteria established in Internal Control — Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). The New York Times
Company’s management is responsible for maintaining effective internal control over financial reporting, and for its
assessment of the effectiveness of internal control over financial reporting included in the accompanying
Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on
The New York Times Company’s internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether effective internal control over financial reporting was maintained in all material respects. Our audit included
obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and
performing such other procedures as we considered necessary in the circumstances. We believe that our audit
provides a reasonable basis for our opinion.
A company’s internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A company’s internal control over financial reporting
includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that
could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies
or procedures may deteriorate.
In our opinion, The New York Times Company maintained, in all material respects, effective internal control
over financial reporting as of December 25, 2016 based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board
(United States), the consolidated balance sheets of The New York Times Company as of December 25, 2016 and
December 27, 2015, and the related consolidated statements of operations, comprehensive income/(loss), changes in
stockholders’ equity, and cash flows for each of the three fiscal years in the period ended December 25, 2016 and our
report dated February 22, 2017 expressed an unqualified opinion thereon.
/s/ Ernst & Young LLP
New York, New York
February 22, 2017
THE NEW YORK TIMES COMPANY – P. 51
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
Assets
Current assets
Cash and cash equivalents
Short-term marketable securities
Accounts receivable (net of allowances of $16,815 in 2016 and $13,485 in 2015)
Prepaid expenses
Other current assets
Total current assets
Long-term marketable securities
Investments in joint ventures
Property, plant and equipment:
Equipment
Buildings, building equipment and improvements
Software
Land
Assets in progress
Total, at cost
Less: accumulated depreciation and amortization
Property, plant and equipment, net
Goodwill
Deferred income taxes
Miscellaneous assets
Total assets
See Notes to the Consolidated Financial Statements.
December 25,
2016
December 27,
2015
$
100,692
$
105,776
449,535
197,355
15,948
32,648
796,178
187,299
15,614
523,104
641,383
212,118
105,710
18,164
507,639
207,180
19,430
22,507
862,532
291,136
22,815
522,197
642,118
203,879
105,710
15,509
1,500,479
1,489,413
(903,736)
(856,974)
596,743
134,517
301,342
153,702
632,439
109,085
309,142
190,541
$
2,185,395
$
2,417,690
P. 52 – THE NEW YORK TIMES COMPANY
CONSOLIDATED BALANCE SHEETS — continued
(In thousands, except share and per share data)
Liabilities and stockholders’ equity
Current liabilities
Accounts payable
Accrued payroll and other related liabilities
Unexpired subscriptions
Current portion of long-term debt and capital lease obligations
Accrued expenses and other
Total current liabilities
Other liabilities
Long-term debt and capital lease obligations
Pension benefits obligation
Postretirement benefits obligation
Other
Total other liabilities
Stockholders’ equity
Common stock of $.10 par value:
December 25,
2016
December 27,
2015
$
104,463
$
96,082
96,463
66,686
—
131,125
398,737
246,978
558,790
57,999
78,647
98,256
60,184
188,377
120,686
563,585
242,851
627,697
62,879
92,223
942,414
1,025,650
Class A – authorized: 300,000,000 shares; issued: 2016 – 169,206,879; 2015 – 168,263,533 (including
treasury shares: 2016 – 8,870,801; 2015 – 7,691,129)
16,921
16,826
Class B – convertible – authorized and issued shares: 2016 – 816,632; 2015 – 816,635 (including
treasury shares: 2016 – none; 2015 – none)
Additional paid-in capital
Retained earnings
Common stock held in treasury, at cost
Accumulated other comprehensive loss, net of income taxes:
Foreign currency translation adjustments
Funded status of benefit plans
Total accumulated other comprehensive loss, net of income taxes
Total New York Times Company stockholders’ equity
Noncontrolling interest
Total stockholders’ equity
82
82
149,928
146,348
1,331,911
1,328,744
(171,211)
(156,155)
(1,822)
17
(477,994)
(509,111)
(479,816)
(509,094)
847,815
826,751
(3,571)
1,704
844,244
828,455
Total liabilities and stockholders’ equity
$
2,185,395
$
2,417,690
See Notes to the Consolidated Financial Statements.
THE NEW YORK TIMES COMPANY – P. 53
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)
Revenues
Circulation
Advertising
Other
Total revenues
Operating costs
Production costs:
Wages and benefits
Raw materials
Other
Total production costs
Selling, general and administrative costs
Depreciation and amortization
Total operating costs
Restructuring charge
Multiemployer pension plan withdrawal expense
Pension settlement charge
Early termination charge
Operating profit
Loss from joint ventures
Interest expense, net
Income from continuing operations before income taxes
Income tax expense/(benefit)
Income from continuing operations
Loss from discontinued operations, net of income taxes
Net income
Net loss attributable to the noncontrolling interest
Net income attributable to The New York Times Company common stockholders
Amounts attributable to The New York Times Company common stockholders:
Income from continuing operations
Loss from discontinued operations, net of income taxes
Net income
See Notes to the Consolidated Financial Statements.
P. 54 – THE NEW YORK TIMES COMPANY
Years Ended
December 25,
2016
December 27,
2015
December 28,
2014
$
880,543
$
851,790
$
840,213
580,732
638,709
662,315
94,067
88,716
86,000
1,555,342
1,579,215
1,588,528
363,051
354,516
357,573
72,325
192,728
628,104
721,083
61,723
77,176
186,120
617,812
713,837
61,597
88,958
197,464
643,995
761,055
79,455
1,410,910
1,393,246
1,484,505
14,804
6,730
21,294
—
—
9,055
40,329
—
101,604
136,585
(36,273)
(783)
34,805
30,526
4,421
26,105
(2,273)
23,832
5,236
39,050
96,752
33,910
62,842
—
62,842
404
—
—
9,525
2,550
91,948
(8,368)
53,730
29,850
(3,541)
33,391
(1,086)
32,305
1,002
$
$
$
29,068
$
63,246
$
33,307
31,341
$
63,246
$
34,393
(2,273)
—
(1,086)
29,068
$
63,246
$
33,307
CONSOLIDATED STATEMENTS OF OPERATIONS — continued
(In thousands, except per share data)
Average number of common shares outstanding:
Basic
Diluted
Basic earnings per share attributable to The New York Times Company common
stockholders:
Income from continuing operations
Loss from discontinued operations, net of income taxes
Net income
Diluted earnings per share attributable to The New York Times Company common
stockholders:
Income from continuing operations
Loss from discontinued operations, net of income taxes
Net income
Dividends declared per share
See Notes to the Consolidated Financial Statements.
Years Ended
December 25,
2016
December 27,
2015
December 28,
2014
161,128
162,817
164,390
166,423
150,673
161,323
$
$
$
$
$
0.19
$
0.38
$
(0.01)
—
0.18
$
0.38
$
0.19
$
0.38
$
(0.01)
0.18
0.16
$
$
—
0.38
0.16
$
$
0.23
(0.01)
0.22
0.21
(0.01)
0.20
0.16
THE NEW YORK TIMES COMPANY – P. 55
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)
(In thousands)
Net income
Other comprehensive income/(loss), before tax:
Years Ended
December 25,
2016
December 27,
2015
December 28,
2014
$
23,832
$
62,842
$
32,305
Foreign currency translation adjustments-(loss)
(3,070)
(8,803)
(11,006)
Pension and postretirement benefits obligation
Other comprehensive income/(loss), before tax
Income tax (expense)/benefit
Other comprehensive income/(loss), net of tax
Comprehensive income/(loss)
Comprehensive income attributable to the noncontrolling interest
51,405
48,335
50,579
41,776
(206,889)
(217,895)
(19,096)
(16,988)
86,110
29,239
53,071
5,275
24,788
87,630
317
(131,785)
(99,480)
1,603
Comprehensive income/(loss) attributable to The New York Times Company
common stockholders
$
58,346
$
87,947
$
(97,877)
See Notes to the Consolidated Financial Statements.
P. 56 – THE NEW YORK TIMES COMPANY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(In thousands,
except share and
per share data)
Capital
Stock
Class A
and
Class B
Common
Additional
Paid-in
Capital
Retained
Earnings
Common
Stock
Held in
Treasury,
at Cost
Accumulated
Other
Comprehensive
Loss, Net of
Income
Taxes
Total
New York
Times
Company
Stockholders’
Equity
Non-
controlling
Interest
Total
Stock-
holders’
Equity
Balance, December 29, 2013
$ 15,211 $
33,045 $ 1,283,518 $ (86,253) $
(402,611) $
842,910 $
3,624 $ 846,534
—
—
33,307
(1,002)
32,305
(24,918)
— (24,918)
(131,184)
(131,184)
(601)
(131,785)
Net income/(loss)
Dividends
Other comprehensive income
Issuance of shares:
Stock options – 169,286
Class A shares
Stock conversions – 1,426
Class B shares to Class A
shares
Restricted stock units vested
– 241,607 Class A shares
Stock-based compensation
Income tax benefit related to
share-based payments
—
—
—
17
—
24
—
—
—
—
—
1,102
—
(2,355)
9,480
(2,055)
33,307
(24,918)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Balance, December 28, 2014
15,252
39,217
1,291,907
(86,253)
(533,795)
Net income/(loss)
Dividends
Other comprehensive loss
Issuance of shares:
Stock options – 341,362
Class A shares
Restricted stock units vested
– 233,901 Class A shares
Performance-based awards –
87,134 Class A shares
Warrants - 15,900,000 Class
A Shares
Share repurchases - 5,511,233
Class A shares
Stock-based compensation
Income tax shortfall related to
share-based payments
—
—
—
34
23
9
—
—
—
1,909
(2,207)
(1,574)
1,590
99,474
—
—
—
—
10,431
(902)
63,246
(26,409)
—
—
—
—
—
—
—
—
—
—
—
19
— (69,921)
—
—
—
—
—
—
24,701
—
—
—
—
—
—
—
1,119
—
(2,331)
9,480
(2,055)
726,328
63,246
(26,409)
24,701
1,943
(2,184)
(1,565)
—
—
—
—
—
1,119
—
(2,331)
9,480
(2,055)
2,021
728,349
(404)
62,842
— (26,409)
87
24,788
—
—
—
1,943
(2,184)
(1,565)
101,083
— 101,083
(69,921)
10,431
(902)
— (69,921)
—
—
10,431
(902)
Balance, December 27, 2015
16,908
146,348
1,328,744
(156,155)
(509,094)
826,751
1,704
828,455
Net income/(loss)
Dividends
Other comprehensive income
Issuance of shares:
Stock options – 114,652
Class A shares
Restricted stock units vested
– 304,171 Class A shares
Performance-based awards –
524,520 Class A shares
Share Repurchases – 1,179,672
Class A shares
Stock-based compensation
Income tax shortfall related to
share-based payments
—
—
—
12
30
53
—
—
—
—
—
—
750
(2,769)
(6,941)
—
12,622
(82)
29,068
(25,901)
—
—
—
—
—
—
—
—
—
—
— (15,056)
—
—
—
—
—
—
29,278
29,068
(5,236)
23,832
(25,901)
29,278
— (25,901)
(39)
29,239
—
—
—
—
—
—
762
(2,739)
(6,888)
(15,056)
12,622
(82)
—
—
—
762
(2,739)
(6,888)
— (15,056)
—
—
12,622
(82)
Balance, December 25, 2016
$ 17,003 $
149,928 $ 1,331,911 $(171,211) $
(479,816) $
847,815 $
(3,571) $ 844,244
See Notes to the Consolidated Financial Statements.
THE NEW YORK TIMES COMPANY – P. 57
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Cash flows from operating activities
Net income
Adjustments to reconcile net income to net cash provided by operating activities:
Years Ended
December 25,
2016
December 27,
2015
December 28,
2014
$
23,832
$
62,842
$
32,305
Restructuring charge
Pension settlement charges
Multiemployer pension plan charges
Gain on insurance settlement
Early termination charge
Depreciation and amortization
Stock-based compensation expense
Undistributed loss of joint ventures
Deferred income taxes
Long-term retirement benefit obligations
Uncertain tax positions
Other – net
Changes in operating assets and liabilities:
Accounts receivable – net
Other current assets
Accounts payable, accrued payroll and other liabilities
Unexpired subscriptions
Net cash provided by operating activities
Cash flows from investing activities
Purchases of marketable securities
Maturities of marketable securities
Cash distribution from corporate-owned life insurance
Business acquisitions
(Purchases)/proceeds from investments
Capital expenditures
Change in restricted cash
Other-net
Repayment of borrowings against cash surrender value of corporate-owned life insurance
14,804
21,294
11,701
—
—
61,723
12,430
36,273
(13,128)
(55,228)
5,089
(10,193)
9,825
1,599
(32,276)
6,502
94,247
(566,846)
725,365
38,000
(40,410)
(1,955)
(30,095)
3,804
409
—
—
40,329
9,055
—
—
61,597
10,588
783
(10,102)
(15,404)
1,627
7,745
5,510
22,141
(22,833)
1,448
175,326
(818,865)
818,262
—
—
(5,068)
(26,965)
1,521
412
—
Net cash provided by/(used in) investing activities
128,272
(30,703)
Cash flows from financing activities
Long-term obligations:
Repayment of debt and capital lease obligations
Dividends paid
Capital shares:
Stock issuances
Repurchases
Windfall tax benefit related to share-based payments
Net cash used in financing activities
Net decrease in cash and cash equivalents
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
See Notes to the Consolidated Financial Statements.
P. 58 – THE NEW YORK TIMES COMPANY
(189,768)
(25,897)
(223,648)
(26,599)
761
(15,684)
3,193
103,026
(69,293)
2,303
(227,395)
(214,211)
(4,876)
(208)
105,776
(69,588)
(1,243)
176,607
$
100,692
$
105,776
$
—
9,525
—
(1,859)
2,550
79,455
8,880
10,980
(10,621)
(37,334)
17,310
12,141
(10,166)
507
(33,911)
729
80,491
(777,945)
506,711
—
—
7,331
(35,350)
(1,401)
1,942
(26,005)
(324,717)
(38,857)
(24,858)
1,120
—
1,209
(61,386)
(305,612)
(526)
482,745
176,607
SUPPLEMENTAL DISCLOSURES TO CONSOLIDATED STATEMENTS OF CASH FLOWS
Cash Flow Information
(In thousands)
Cash payments
Interest, net of capitalized interest
Income tax payments – net
See Notes to the Consolidated Financial Statements.
Years Ended
December 25,
2016
December 27,
2015
December 28,
2014
$
$
39,487
44,896
$
$
41,449
21,078
$
$
54,252
21,325
THE NEW YORK TIMES COMPANY – P. 59
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
Nature of Operations
The New York Times Company is a global media organization that includes newspapers, print and digital
products and investments (see Note 5). The New York Times Company and its consolidated subsidiaries are referred
to collectively as the “Company,” “we,” “our” and “us.” Our major sources of revenue are circulation and advertising.
Principles of Consolidation
The accompanying Consolidated Financial Statements have been prepared in accordance with generally
accepted accounting principles in the United States of America (“GAAP”) and include the accounts of our Company
and our wholly and majority-owned subsidiaries after elimination of all significant intercompany transactions.
The portion of the net income or loss and equity of a subsidiary attributable to the owners of a subsidiary other
than the Company (a noncontrolling interest) is included as a component of consolidated stockholders‘ equity in our
Consolidated Balance Sheets, within net income or loss in our Consolidated Statements of Operations, within
comprehensive income or loss in our Consolidated Statements of Comprehensive Income/(Loss) and as a component
of consolidated stockholders’ equity in our Consolidated Statements of Changes in Stockholders’ Equity.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and
assumptions that affect the amounts reported in our Consolidated Financial Statements. Actual results could differ
from these estimates.
Fiscal Year
Our fiscal year end is the last Sunday in December. Fiscal years 2016, 2015 and 2014 each comprised 52 weeks
and ended on December 25, 2016, December 27, 2015, and December 28, 2014, respectively.
2. Summary of Significant Accounting Policies
Cash and Cash Equivalents
We consider all highly liquid debt instruments with original maturities of three months or less to be cash
equivalents.
Marketable Securities
We have investments in marketable debt securities. We determine the appropriate classification of our
investments at the date of purchase and reevaluate the classifications at the balance sheet date. Marketable debt
securities with maturities of 12 months or less are classified as short-term. Marketable debt securities with maturities
greater than 12 months are classified as long-term. We have the intent and ability to hold our marketable debt
securities until maturity; therefore, they are accounted for as held-to-maturity and stated at amortized cost.
Concentration of Risk
Financial instruments, which potentially subject us to concentration of risk, are cash and cash equivalents and
investments. Cash is placed with major financial institutions. As of December 25, 2016, we had cash balances at
financial institutions in excess of federal insurance limits. We periodically evaluate the credit standing of these
financial institutions as part of our ongoing investment strategy.
Our investment portfolio consists of investment-grade securities diversified among security types, issuers and
industries. Our cash equivalents and investments are primarily managed by third-party investment managers who
are required to adhere to investment policies approved by our Board of Directors designed to mitigate risk.
Accounts Receivable
Credit is extended to our advertisers and our subscribers based upon an evaluation of the customer’s financial
condition, and collateral is not required from such customers. Allowances for estimated credit losses, rebates, returns,
rate adjustments and discounts are generally established based on historical experience.
P. 60 – THE NEW YORK TIMES COMPANY
Inventories
Inventories are stated at the lower of cost or current market value. Inventory cost is generally based on the last-
in, first-out (“LIFO”) method for newsprint and the first-in, first-out (“FIFO”) method for other inventories.
Investments
Investments in which we have at least a 20%, but not more than a 50%, interest are generally accounted for
under the equity method. Investment interests below 20% are generally accounted for under the cost method, except
if we could exercise significant influence, the investment would be accounted for under the equity method.
We evaluate whether there has been an impairment of our cost and equity method investments annually or in
an interim period if circumstances indicate that a possible impairment may exist.
Property, Plant and Equipment
Property, plant and equipment are stated at cost. Depreciation is computed by the straight-line method over the
shorter of estimated asset service lives or lease terms as follows: buildings, building equipment and improvements –
10 to 40 years; equipment – 3 to 30 years; and software – 2 to 5 years. We capitalize interest costs and certain staffing
costs as part of the cost of major projects.
We evaluate whether there has been an impairment of long-lived assets, primarily property, plant and
equipment, if certain circumstances indicate that a possible impairment may exist. These assets are tested for
impairment at the asset group level associated with the lowest level of cash flows. An impairment exists if the
carrying value of the asset (1) is not recoverable (the carrying value of the asset is greater than the sum of
undiscounted cash flows) and (2) is greater than its fair value.
Goodwill and Intangibles
Goodwill is the excess of cost over the fair value of tangible and intangible net assets acquired. Goodwill is not
amortized but tested for impairment annually or in an interim period if certain circumstances indicate a possible
impairment may exist. Our annual impairment testing date is the first day of our fiscal fourth quarter.
We test for goodwill impairment at the reporting unit level, which is our single operating segment. We first
perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit
is less than its carrying value. The qualitative assessment includes, but is not limited to, the results of our most recent
quantitative impairment test, consideration of industry, market and macroeconomic conditions, cost factors, cash
flows, changes in key management personnel and our share price. The result of this assessment determines whether it
is necessary to perform the goodwill impairment two-step test. For the 2016 annual impairment testing, based on our
qualitative assessment, we concluded that it is more likely than not that goodwill is not impaired.
If we determine that it is more likely than not that the fair value of a reporting unit is less than its carrying
value, in the first step, we compare the fair value of the reporting unit with its carrying amount, including goodwill.
Fair value is calculated by a combination of a discounted cash flow model and a market approach model. In
calculating fair value for our reporting unit, we generally weigh the results of the discounted cash flow model more
heavily than the market approach because the discounted cash flow model is specific to our business and long-term
projections. If the fair value exceeds the carrying amount, goodwill is not considered impaired. If the carrying amount
exceeds the fair value, the second step must be performed to measure the amount of the impairment loss, if any. In the
second step, we compare the implied fair value of the reporting unit’s goodwill with the carrying amount of that
goodwill. An impairment loss would be recognized in an amount equal to the excess of the carrying amount of the
goodwill over the implied fair value of the goodwill.
Intangible assets that are not amortized (i.e., trade names) are tested for impairment at the asset level by
comparing the fair value of the asset with its carrying amount. If the fair value, which is based on future cash flows,
exceeds the carrying value, the asset is not considered impaired. If the carrying amount exceeds the fair value, an
impairment loss would be recognized in an amount equal to the excess of the carrying amount of the asset over the
fair value of the asset.
Intangible assets that are amortized (i.e., customer lists, non-competes, etc.) are tested for impairment at the
asset level associated with the lowest level of cash flows. An impairment exists if the carrying value of the asset (1) is
not recoverable (the carrying value of the asset is greater than the sum of undiscounted cash flows) and (2) is greater
than its fair value.
THE NEW YORK TIMES COMPANY – P. 61
The discounted cash flow analysis requires us to make various judgments, estimates and assumptions, many of
which are interdependent, about future revenues, operating margins, growth rates, capital expenditures, working
capital and discount rates. The starting point for the assumptions used in our discounted cash flow analysis is the
annual long-range financial forecast. The annual planning process that we undertake to prepare the long-range
financial forecast takes into consideration a multitude of factors, including historical growth rates and operating
performance, related industry trends, macroeconomic conditions, and marketplace data, among others. Assumptions
are also made for perpetual growth rates for periods beyond the long-range financial forecast period. Our estimates of
fair value are sensitive to changes in all of these variables, certain of which relate to broader macroeconomic
conditions outside our control.
The market approach analysis includes applying a multiple, based on comparable market transactions, to
certain operating metrics of the reporting unit.
The significant estimates and assumptions used by management in assessing the recoverability of goodwill
acquired and other intangibles are estimated future cash flows, discount rates, growth rates, as well as other factors.
Any changes in these estimates or assumptions could result in an impairment charge. The estimates, based on
reasonable and supportable assumptions and projections, require management’s subjective judgment. Depending on
the assumptions and estimates used, the estimated results of the impairment tests can vary within a range of
outcomes.
In addition to annual testing, management uses certain indicators to evaluate whether the carrying value of our
reporting unit may not be recoverable and an interim impairment test may be required. These indicators include: (1)
current-period operating or cash flow declines combined with a history of operating or cash flow declines or a
projection/forecast that demonstrates continuing declines in the cash flow or the inability to improve our operations
to forecasted levels, (2) a significant adverse change in the business climate, whether structural or technological, (3)
significant impairments and (4) a decline in our stock price and market capitalization.
Management has applied what it believes to be the most appropriate valuation methodology for its impairment
testing. Additionally, management believes that the likelihood of an impairment of goodwill is remote due to the
excess market capitalization relative to its net book value. See Note 4.
Self-Insurance
We self-insure for workers’ compensation costs, automobile and general liability claims, up to certain
deductible limits, as well as for certain employee medical and disability benefits. The recorded liabilities for self-
insured risks are primarily calculated using actuarial methods. The liabilities include amounts for actual claims, claim
growth and claims incurred but not yet reported. The recorded liabilities for self-insured risks were approximately
$38 million and $41 million as of December 25, 2016 and December 27, 2015, respectively.
Pension and Other Postretirement Benefits
Our single-employer pension and other postretirement benefit costs are accounted for using actuarial
valuations. We recognize the funded status of these plans – measured as the difference between plan assets, if funded,
and the benefit obligation – on the balance sheet and recognize changes in the funded status that arise during the
period but are not recognized as components of net periodic pension cost, within other comprehensive income/(loss),
net of income taxes. The assets related to our funded pension plans are measured at fair value.
We make significant subjective judgments about a number of actuarial assumptions, which include discount
rates, health-care cost trend rates, long-term return on plan assets and mortality rates. Depending on the assumptions
and estimates used, the impact from our pension and other postretirement benefits could vary within a range of
outcomes and could have a material effect on our Consolidated Financial Statements.
We also recognize the present value of pension liabilities associated with the withdrawal from multiemployer
pension plans. We record liabilities for obligations related to complete, partial and estimated withdrawals from
multiemployer pension plans. The actual liability is not known until each plan completes a final assessment of the
withdrawal liability and issues a demand to us. Therefore, we adjust the estimate of our multiemployer pension plan
liability as more information becomes available that allows us to refine our estimates.
See Notes 9 and 10 for additional information regarding pension and other postretirement benefits.
P. 62 – THE NEW YORK TIMES COMPANY
Revenue Recognition
Circulation revenues include single-copy and subscription revenues. Circulation revenues are based on the
number of copies of the printed newspaper (through home-delivery subscriptions and single-copy sales) and digital
subscriptions sold and the rates charged to the respective customers. Single-copy revenue is recognized based on date
of publication, net of provisions for related returns. Proceeds from subscription revenues are deferred at the time of
sale and are recognized in earnings on a pro rata basis over the terms of the subscriptions. When our digital
subscriptions are sold through third parties, we are a principal in the transaction and, therefore, revenues and related
costs to third parties for these sales are reported on a gross basis. Several factors are considered to determine whether
we are a principal, most notably whether we are the primary obligor to the customer and have determined the selling
price and product specifications.
Advertising revenues are recognized when advertisements are published in newspapers or placed on digital
platforms or, with respect to certain digital advertising, each time a user clicks on certain advertisements, net of
provisions for estimated rebates and rate adjustments.
We recognize a rebate obligation as a reduction of revenues, based on the amount of estimated rebates that will
be earned and claimed, related to the underlying revenue transactions during the period. Measurement of the rebate
obligation is estimated based on the historical experience of the number of customers that ultimately earn and use the
rebate. We recognize an obligation for rate adjustments as a reduction of revenues, based on the amount of estimated
post-billing adjustments that will be claimed. Measurement of the rate adjustment obligation is estimated based on
historical experience of credits actually issued.
Other revenues are recognized when the related service or product has been delivered.
Income Taxes
Income taxes are recognized for the following: (1) amount of taxes payable for the current year and (2) deferred
tax assets and liabilities for the future tax consequence of events that have been recognized differently in the financial
statements than for tax purposes. Deferred tax assets and liabilities are established using statutory tax rates and are
adjusted for tax rate changes in the period of enactment.
We assess whether our deferred tax assets should be reduced by a valuation allowance if it is more likely than
not that some portion or all of the deferred tax assets will not be realized. Our process includes collecting positive (i.e.,
sources of taxable income) and negative (i.e., recent historical losses) evidence and assessing, based on the evidence,
whether it is more likely than not that the deferred tax assets will not be realized.
We recognize in our financial statements the impact of a tax position if that tax position is more likely than not
of being sustained on audit, based on the technical merits of the tax position. This involves the identification of
potential uncertain tax positions, the evaluation of tax law and an assessment of whether a liability for uncertain tax
positions is necessary. Different conclusions reached in this assessment can have a material impact on our
Consolidated Financial Statements.
We operate within multiple taxing jurisdictions and are subject to audit in these jurisdictions. These audits can
involve complex issues, which could require an extended period of time to resolve. Until formal resolutions are
reached between us and the tax authorities, the timing and amount of a possible audit settlement for uncertain tax
benefits is difficult to predict.
Stock-Based Compensation
We establish fair value for our stock-based awards to determine our cost and recognize the related expense over
the appropriate vesting period. We recognize stock-based compensation expense for outstanding stock-settled long-
term performance awards, stock-settled and cash-settled restricted stock units, stock options and stock appreciation
rights. See Note 15 for additional information related to stock-based compensation expense.
Earnings/(Loss) Per Share
Basic earnings/(loss) per share is calculated by dividing net earnings/(loss) available to common stockholders
by the weighted-average common stock outstanding. Diluted earnings/(loss) per share is calculated similarly, except
that it includes the dilutive effect of the assumed exercise of securities, including outstanding warrants and the effect
of shares issuable under our Company’s stock-based incentive plans if such effect is dilutive.
THE NEW YORK TIMES COMPANY – P. 63
The two-class method is an earnings allocation method for computing earnings/(loss) per share when a
company’s capital structure includes either two or more classes of common stock or common stock and participating
securities. This method determines earnings/(loss) per share based on dividends declared on common stock and
participating securities (i.e., distributed earnings), as well as participation rights of participating securities in any
undistributed earnings.
Foreign Currency Translation
The assets and liabilities of foreign companies are translated at year-end exchange rates. Results of operations
are translated at average rates of exchange in effect during the year. The resulting translation adjustment is included
as a separate component in the Stockholders’ Equity section of our Consolidated Balance Sheets, in the caption
“Accumulated other comprehensive loss, net of income taxes.”
Recent Accounting Pronouncements
In November 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update
(“ASU”) 2016-18, “Statement of Cash Flow: Restricted cash,” which amends the guidance in Accounting Standards
Codification (“ASC”) 230 on the classification and presentation of restricted cash in the statement of cash flows. The
key requirements of the ASU are: (1) all entities should include in its cash and cash-equivalent balances in the
statement of cash flows those amounts that are deemed to be restricted cash and restricted cash equivalents, (2) a
reconciliation between the statement of financial position and the statement of cash flows must be disclosed when the
statement of financial position includes more than one line item for cash, cash equivalents, restricted cash, and
restricted cash equivalents, (3) changes in restricted cash and restricted cash equivalents that result from transfers
between cash, cash equivalents, and restricted cash and restricted cash equivalents should not be presented as cash
flow activities in the statement of cash flows and (4) an entity with a material balance of amounts generally described
as restricted cash and restricted cash equivalents must disclose information about the nature of the restrictions.This
guidance becomes effective for Company for fiscal years beginning after December 15, 2017, and interim periods
within those fiscal years. Early adoption is permitted. We are currently in the process of evaluating the impact of the
new cash flow guidance.
In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows: Classification of Certain Cash
Receipts and Cash Payments,” which amends the guidance in ASC 230 on the classification of certain cash receipts
and cash payments in the statement of cash flows. The primary purpose of this ASU is to reduce the diversity in
practice that has resulted from the lack of consistent principles on this topic. The ASU’s amendments add or clarify
guidance on eight cash flows issues: debt prepayment or debt extinguishment costs, settlement of zero-coupon debt
instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective
interest rate of the borrowing, contingent consideration payments made after a business combination, proceeds from
the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, including
bank-owned life insurance policies, distributions received from equity method investees, beneficial interests in
securitization transactions, and separately identifiable cash flows and application of the predominance principle. This
guidance becomes effective for the Company for fiscal years beginning after December 15, 2017, and interim periods
within those fiscal years. Early adoption is permitted, including adoption in an interim period. All amendments must
be adopted in the same period. We are currently in the process of evaluating the impact of the new cash flow
guidance.
In March 2016, the FASB issued ASU 2016-09, “Compensation — Stock Compensation,” which provides
guidance on accounting for share-based payment transactions, including the income tax consequences, classification
of awards as either equity or liabilities, and classification on the statement of cash flows. This guidance becomes
effective for the Company for fiscal years beginning after December 25, 2016. Early application is permitted.
Amendments related to the timing of when excess tax benefits are recognized and classified on the statement of cash
flows, forfeitures, minimum statutory withholding requirements, and intrinsic value will be applied using a modified
retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the
period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the
statement of cash flows when the Company withholds shares to meet the minimum statutory withholding
requirement will be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax
deficiencies in the income statement and the practical expedient for estimating expected term will be applied
prospectively. The Company may elect to apply the amendments related to the presentation of excess tax benefits on
the statement of cash flows using either a prospective transition method or a retrospective transition method. We are
P. 64 – THE NEW YORK TIMES COMPANY
currently in the process of evaluating the impact of the new stock compensation guidance. Based upon our initial
evaluation, we do not expect the adoption of the standard to have a material effect on our financial condition or
results of operations.
In February 2016, the FASB issued ASU 2016-02, “Leases,” which provides guidance on accounting for leases
and disclosure of key information about leasing arrangements. The guidance requires lessees to recognize the
following for all operating and finance leases at the commencement date: (1) a lease liability, which is the obligation to
make lease payments arising from a lease, measured on a discounted basis and (2) a right-of-use asset representing
the lessee’s right to use, or control the use of, the underlying asset for the lease term. A lessee is permitted to make an
accounting policy election not to recognize lease assets and lease liabilities for short-term leases with a term of 12
months or less. The guidance does not fundamentally change lessor accounting; however, some changes have been
made to align that guidance with the lessee guidance and other areas within GAAP. This guidance becomes effective
for the Company for fiscal years beginning after December 30, 2018. Early application is permitted. This guidance will
be applied on a modified retrospective basis for leases existing at, or entered into after, the earliest period presented in
the financial statements. We are currently in the process of evaluating the impact of the new leasing guidance and
expect that most of our operating lease commitments will be subject to the new standard. The adoption of the
standard will require us to add right-of-use assets and lease liabilities onto our balance sheet. Based upon our initial
evaluation, we do not expect the adoption of the standard to have a material effect on our results of operations and
liquidity.
In May 2015, the FASB issued ASU 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in
Certain Entities That Calculate Net Asset Value (NAV) per Share (or Its Equivalent). The guidance removes the
requirement to include investments in the fair value hierarchy for which fair value is measured using the NAV per
share practical expedient under Accounting Standard Codification (ASC) 820. The guidance is effective
retrospectively for the year ending December 31, 2016 with early adoption permitted.
In August 2014, the FASB issued ASU 2014-15, “Disclosure of Uncertainties About an Entity’s Ability to
Continue as a Going Concern,” which provides guidance on determining when and how reporting entities must
disclose going-concern uncertainties in their financial statements. The new standard requires management to perform
interim and annual assessment of an entity’s ability to continue as a going concern within one year of the date of
issuance of the entity’s financial statements. Further, an entity must provide certain disclosures if there is “substantial
doubt about the entity’s ability to continue as a going concern. The new guidance becomes effective for the Company
for fiscal years ending on or after December 15, 2016 and interim periods thereafter. We adopted this ASU
prospectively beginning with our fiscal year ended December 25, 2016.
In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers,” which prescribes a
single comprehensive model for entities to use in the accounting of revenue arising from contracts with customers.
The new guidance will supersede virtually all existing revenue guidance under GAAP and International Financial
Reporting Standards and is effective for fiscal years beginning after December 31, 2017. There are two transition
options available to entities: the full retrospective approach or the modified retrospective approach. Under the full
retrospective approach, the Company would restate prior periods in compliance with Accounting Standards
Codification 250, “Accounting Changes and Error Corrections.” Alternatively, the Company may elect the modified
retrospective approach, which allows for the new revenue standard to be applied to existing contracts as of the
effective date with a cumulative catch-up adjustment recorded to retained earnings. We currently anticipate adopting
the new standard using the modified retrospective method beginning January 1, 2018.
Subsequently, in March 2016, the FASB issued ASU 2016-08, “Revenue from Contracts with Customers (Topic
606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” which clarifies the
implementation guidance on principal versus agent considerations in ASU 2014-09. In April 2016, the FASB also
issued ASU 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and
Licensing,” to reduce the cost and complexity of applying the guidance on identifying promised goods or services
when identifying a performance obligation and improve the operability and understandability of the licensing
implementation guidance. In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers
(Topic 606): Narrow Scope Improvements and Practical Expedients,” to reduce the cost and complexity of applying
the guidance to address certain issues on assessing collectability, presentation of sales taxes, noncash consideration,
and completed contracts and contract modifications at transition. The amendments in ASU 2014-09, 2016-10, and
2016-12 do not change the core principle of ASU 2014-09.
THE NEW YORK TIMES COMPANY – P. 65
Based upon our initial evaluation, we do not expect the adoption of the standard to have a material effect on
our financial condition or results of operations. While we continue to evaluate the impact of the new revenue
guidance, we currently believe that the most significant changes will be primarily related to how we account for
certain licensing arrangements in the other revenue category. However, preliminary assessments may be subject to
change.
The Company considers the applicability and impact of all recently issued accounting pronouncements. Recent
accounting pronouncements not specifically identified in our disclosures are either not applicable to the Company or
are not expected to have a material effect on our financial condition or results of operations.
3. Marketable Securities
Our marketable debt securities consisted of the following:
(In thousands)
Short-term marketable securities
U.S Treasury securities
Corporate debt securities
U.S. governmental agency securities
Municipal securities
Certificates of deposit
Commercial paper
Total short-term marketable securities
Long-term marketable securities
U.S. governmental agency securities
Corporate debt securities
U.S Treasury securities
December 25,
2016
December 27,
2015
$
150,623
$
184,278
150,599
185,561
64,135
—
—
84,178
65,222
1,363
60,244
10,971
449,535
$
507,639
110,732
$
150,583
61,775
14,792
119,784
20,769
$
$
Total long-term marketable securities
$
187,299
$
291,136
Marketable debt securities
As of December 25, 2016, our short-term and long-term marketable securities had remaining maturities of less
than 1 month to 12 months and 13 months to 34 months, respectively. See Note 8 for additional information regarding
the fair value of our marketable securities.
4. Goodwill and Intangibles
During the first and third quarters of 2016, the Company acquired two digital marketing agencies, HelloSociety,
LLC and Fake Love, LLC, for an aggregate of $15.4 million, in all-cash transactions. The Company allocated the
purchase prices based on the valuation of assets acquired and liabilities assumed, resulting in allocations to goodwill,
intangibles, property, plant and equipment and other miscellaneous assets.
During the fourth quarter of 2016, the Company acquired Submarine Leisure Club, Inc., which owns the
product review and recommendation websites The Wirecutter and The Sweethome, in an all-cash transaction. We
paid $25.0 million, including a payment made for a non-compete agreement. In connection with the transaction, we
also entered into a consulting agreement and retention agreements that will likely require payments over the three
years following the acquisition.
The Company has preliminarily allocated the purchase price of Submarine Leisure Club, Inc. to acquired net
assets, goodwill and intangibles pending the completion of the valuation of assets acquired and liabilities assumed.
The final asset and liability fair values may differ from those included in the Company’s Consolidated Balance Sheet
P. 66 – THE NEW YORK TIMES COMPANY
as of December 25, 2016; however, the changes are not expected to have a material effect on the Company’s
Consolidated Financial Statements.
The aggregate carrying amount of intangible assets of $10.6 million related to these acquisitions has been
included in “Miscellaneous Assets” in our Consolidated Balance Sheets. The estimated useful lives for these assets
range from 3 to 7 years and are amortized on a straight-line basis.
The changes in the carrying amount of goodwill, including goodwill purchased in 2016 as part of the
acquisitions in 2016 and 2015, were as follows:
(In thousands)
Balance as of December 28, 2014
Foreign currency translation
Balance as of December 27, 2015
Business acquisitions
Foreign currency translation
Balance as of December 25, 2016
Total
Company
$
116,422
(7,337)
109,085
28,529
(3,097)
$
134,517
The foreign currency translation line item reflects changes in goodwill resulting from fluctuating exchange rates
related to the consolidation of certain international subsidiaries.
5. Investments
Investments in Joint Ventures
As of December 25, 2016, our investments in joint ventures of $15.6 million consisted of equity ownership
interests in the following entities:
Company
Donohue Malbaie Inc.
Madison Paper Industries
Women in the World Media, LLC
Approximate
%
Ownership
49%
40%
30%
We have investments in Donohue Malbaie Inc. (“Malbaie”), a Canadian newsprint company, Madison Paper
Industries (“Madison”), a partnership that previously operated a supercalendered paper mill in Maine, and Women in
the World Media, LLC, a live-event conference business.
Our investments above are accounted for under the equity method, and are recorded in “Investments in joint
ventures” in our Consolidated Balance Sheets. Our proportionate shares of the operating results of our investments
are recorded in “Loss from joint ventures” in our Consolidated Statements of Operations and in “Investments in joint
ventures” in our Consolidated Balance Sheets.
In 2016, we had a loss from joint ventures of $36.3 million compared with a loss of $0.8 million in 2015. The
increase was primarily due to losses related to the shutdown of the Madison paper mill, as described below, partially
offset by increased income from our investment in Malbaie, which benefited from higher newsprint prices and the
impact of a significantly weakened Canadian dollar.
In 2015, we had a loss from joint ventures of $0.8 million compared with a loss of $8.4 million in 2014. The
improvement reflected an impairment charge of $9.2 million ($4.7 million after adjusting for tax and the allocation of
the loss to the non-controlling interest) in 2014 related to our investment in Madison, as well as increased income from
our investment in Malbaie, which benefited from higher newsprint prices and the impact of a significantly weakened
Canadian dollar. This was partially offset by losses from our investment in Madison, which continued to face
THE NEW YORK TIMES COMPANY – P. 67
declining demand for supercalendered paper and was at a competitive disadvantage to Canadian mills selling paper
to the United States, which benefited from the Canadian dollar value decline.
Madison
The Company and UPM-Kymmene Corporation (“UPM”), a Finnish paper manufacturing company, are
partners through subsidiary companies in Madison. The Company’s 40% ownership of Madison is through an 80%-
owned consolidated subsidiary that owns 50% of Madison. UPM owns 60% of Madison, including a 10% interest
through a 20% noncontrolling interest in the consolidated subsidiary of the Company. In March 2016, UPM
announced the closure of the paper mill, which occurred in May 2016. During the first quarter of 2016, we recognized
$41.4 million in losses from joint ventures related to the announced closure of the paper mill. Our proportionate share
of the loss is reduced by the 20% noncontrolling interest. As a result of the mill closure, we wrote our investment
down to zero and recorded a liability of $28.3 million, reflecting our share of the impairment and losses incurred in
2016 by Madison and our funding obligation. These amounts are presented in “Accrued expenses and other” in our
Consolidated Balance Sheets.
The Company’s joint venture in Madison is currently being liquidated and a plan is in place to sell assets
(including hydro power assets) at the mill site. In the fourth quarter of 2016, Madison sold its non-hydro power assets
at the mill site and we recognized a gain of $3.9 million related to the sale. We expect the sale of the hydro power
assets to be completed in early 2017. We believe the proceeds from the sale will be more than sufficient to cover
Madison’s obligations and therefore allow us to reverse our liability.
We received no distributions from Madison in 2016, 2015, or 2014.
The following table presents summarized unaudited balance sheet information for Madison, which follows a
calendar year:
(In thousands)
Current assets
Noncurrent assets
Total assets
Current liabilities
Noncurrent liabilities
Total liabilities
Total equity
December 31,
2016
December 31,
2015
$
3,766
$
48,998
8,944
12,710
1,373
29,386
30,759
54,473
103,471
13,101
24,058
37,159
$
(18,049)
$
66,312
P. 68 – THE NEW YORK TIMES COMPANY
The following table presents summarized unaudited income statement information for Madison, which follows
a calendar year:
(In thousands)
Revenues
Costs and expenses:
Cost of sales
General and administrative
Operating loss
Other income
Net loss
Malbaie
For the Twelve Months Ended
December 31,
2016
December 31,
2015
December 31,
2014
$
40,523
$
133,319
$
155,807
(63,439)
(126,292)
(147,179)
(62,759)
(13,550)
(17,505)
(126,198)
(139,842)
(164,684)
(85,675)
(6,523)
2
689
(8,877)
(9,977)
$
(85,673)
$
(5,834)
$
(18,854)
We have a 49% equity interest in a Canadian newsprint company, Malbaie. The other 51% is owned by Resolute
FP Canada Inc., a subsidiary of Resolute Forest Products Inc. (“Resolute”), a Delaware corporation. Resolute is a large
global manufacturer of paper, market pulp and wood products. Malbaie manufactures newsprint on the paper
machine it owns within Resolute’s paper mill in Clermont, Quebec. Malbaie is wholly dependent upon Resolute for
its pulp, which is purchased by Malbaie from Resolute’s Clermont paper mill.
We purchase newsprint from Malbaie, and previously purchased supercalendered paper from Madison, at
competitive prices. Such purchases totaled approximately $14 million in 2016, $12 million in 2015 and $20 million in
2014.
We received no distributions from Malbaie in 2016 and 2015 and $3.9 million in 2014.
Cost Method Investments
The aggregate carrying amount of cost method investments included in “Miscellaneous assets’’ in our
Consolidated Balance Sheets were $13.6 million and $11.9 million for December 25, 2016 and December 27, 2015,
respectively.
THE NEW YORK TIMES COMPANY – P. 69
6. Debt Obligations
Our current indebtedness consisted of the repurchase option related to a sale-leaseback of a portion of our New
York headquarters. Our total debt and capital lease obligations consisted of the following:
(In thousands, except percentages)
Total debt and capital lease obligations:
Senior notes due in 2016
Principal amount
Less unamortized discount based on imputed interest rate of 6.625%
Total senior notes due in 2016
Option to repurchase ownership interest in headquarters building in 2019
Principal amount
Less unamortized discount based on imputed interest rate of 13.0%
Total option to repurchase ownership interest in headquarters building in 2019
Capital lease obligations
Total debt and capital lease obligations
Less current portion
December 25,
2016
December 27,
2015
—
—
—
189,170
793
188,377
250,000
250,000
9,801
13,905
240,199
236,095
6,779
246,978
—
6,756
431,228
188,377
Total long-term debt and capital lease obligations
$
246,978
$
242,851
See Note 8 for information regarding the fair value of our long-term debt.
The aggregate face amount of maturities of debt over the next five years and thereafter is as follows:
Amount
$
—
—
250,000
—
—
—
250,000
(9,801)
$
240,199
(In thousands)
2017
2018
2019
2020
2021
Thereafter
Total face amount of maturities
Less: Unamortized debt costs and discount
Carrying value of debt (excludes capital leases)
P. 70 – THE NEW YORK TIMES COMPANY
“Interest expense, net,” as shown in the accompanying Consolidated Statements of Operations was as follows:
(In thousands)
Interest expense
Premium on debt repurchases
Amortization of debt costs and discount on debt
Capitalized interest
Interest income
Total interest expense, net
6.625% Notes
December 25,
2016
December 27,
2015
December 28,
2014
$
39,487
$
41,973
$
51,877
—
4,897
(559)
(9,020)
—
4,756
(338)
(7,341)
2,538
4,651
(152)
(5,184)
$
34,805
$
39,050
$
53,730
In November 2010, we issued $225.0 million aggregate principal amount of 6.625% senior unsecured notes due
December 15, 2016 (“6.625% Notes”). During 2014, we repurchased $18.4 million principal amount of the 6.625%
Notes and recorded a $2.2 million pre-tax charge in connection with the repurchases. In December 2016, the Company
repaid, at maturity, the remaining principal amount of the 6.625% Notes.
Sale-Leaseback Financing
In March 2009, we entered into an agreement to sell and simultaneously lease back a portion of our leasehold
condominium interest in our Company’s headquarters building located at 620 Eighth Avenue in New York City (the
“Condo Interest”). The sale price for the Condo Interest was $225.0 million less transaction costs, for net proceeds of
approximately $211 million. The lease term is 15 years, and we have three renewal options that could extend the term
for an additional 20 years. We have an option, exercisable in 2019, to repurchase the Condo Interest for $250.0 million,
which we currently expect to exercise.
The transaction is accounted for as a financing transaction. As such, we have continued to depreciate the Condo
Interest and account for the rental payments as interest expense. The difference between the purchase option price of
$250.0 million and the net sale proceeds of approximately $211 million, or approximately $39 million, is being
amortized over a 10-year period through interest expense. The effective interest rate on this transaction was
approximately 13%.
7. Other
International Print Operations
On April 26, 2016, we informed employees of proposed measures intended to streamline our international print
operations and support future growth efforts. These measures included a redesign of our international print
newspaper and the relocation of certain editing and production operations from Paris to our locations in Hong Kong
and New York. As of December 25, 2016, we incurred $14.8 million of total costs related to these measures, primarily
related to relocation and severance charges. Cash disbursements of $5.6 million were made in 2016.
Severance Costs
We recognized severance costs, other than those associated with the streamlining of the Company’s
international print operations, of $18.8 million in 2016, $7.0 million in 2015 and $36.1 million in 2014. The majority of
the 2015 costs related to workforce reductions. These costs are recorded in “Selling, general and administrative costs”
in our Consolidated Statements of Operations.
We had a severance liability of $23.2 million and $14.9 million included in “Accrued expenses and other” in our
Consolidated Balance Sheets as of December 25, 2016 and December 27, 2015, respectively.
Pension Settlement Charges
See Note 9 for information regarding pension settlement charges.
THE NEW YORK TIMES COMPANY – P. 71
Multiemployer Pension Plan Withdrawal Expense
See Note 9 for information regarding multiemployer pension plan withdrawal expense.
Early Termination Charge
In 2014, we recorded a $2.6 million charge for the early termination of a distribution agreement.
Advertising Expenses
Advertising expense to promote our consumer and marketing services is recognized the first time an
advertisement is aired or distributed in print form and totaled $89.8 million, $83.4 million and $89.5 million for the
fiscal years ended December 25, 2016, December 27, 2015 and December 28, 2014, respectively.
Capitalized Computer Software Costs
Amortization of capitalized computer software costs included in “Depreciation and amortization” in our
Consolidated Statements of Operations were $11.5 million, $11.9 million and $29.4 million for the fiscal years ended
December 25, 2016, December 27, 2015 and December 28, 2014, respectively.
8. Fair Value Measurements
Fair value is the price that would be received upon the sale of an asset or paid upon transfer of a liability in an
orderly transaction between market participants at the measurement date. The transaction would be in the principal
or most advantageous market for the asset or liability, based on assumptions that a market participant would use in
pricing the asset or liability. The fair value hierarchy consists of three levels:
Level 1–quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability
to access at the measurement date;
Level 2–inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly or indirectly; and
Level 3–unobservable inputs for the asset or liability.
Assets/Liabilities Measured and Recorded at Fair Value on a Recurring Basis
As of December 25, 2016 and December 27, 2015, we had assets related to our qualified pension plans measured
at fair value. The required disclosures regarding such assets are presented in Note 9.
The following table summarizes our financial liabilities measured at fair value on a recurring basis as of
December 25, 2016 and December 27, 2015:
December 25, 2016
December 27, 2015
(In thousands)
Total
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Deferred compensation
$ 31,006
$ 31,006
$
— $
— $ 35,578
$ 35,578
$
— $
—
The deferred compensation liability, included in “Other liabilities—Other” in our Consolidated Balance Sheets,
consists of deferrals under The New York Times Company Deferred Executive Compensation Plan (the “DEC”),
which enables certain eligible executives to elect to defer a portion of their compensation on a pre-tax basis. The
deferred amounts are invested at the executives’ option in various mutual funds. The fair value of deferred
compensation is based on the mutual fund investments elected by the executives and on quoted prices in active
markets for identical assets. Participation in the DEC was frozen effective December 31, 2015, and no new
contributions may be made into the plan.
P. 72 – THE NEW YORK TIMES COMPANY
Assets Measured and Recorded at Fair Value on a Non-Recurring Basis
Certain non-financial assets, such as goodwill, other intangible assets, property, plant and equipment and
certain investments are only recorded at fair value if an impairment charge is recognized. Goodwill and intangible
assets are initially recorded at fair value in purchase accounting. We classified all of these measurements as Level 3, as
we used unobservable inputs within the valuation methodologies that were significant to the fair value
measurements, and the valuations required management‘s judgment due to the absence of quoted market prices. The
following tables present non-financial assets that were measured and recorded at fair value on a non-recurring basis
and the total impairment losses recorded in 2014 on those assets. There was no material impairment recognized in
2016 and 2015.
(In thousands)
Net Carrying
Value as of
December 28,
2014
Fair Value Measured and Recorded Using
Impairment
Losses for the
Year Ended
Level 1
Level 2
Level 3
December 28, 2014
Investments in joint ventures
$
— $
— $
— $
— $
9,216 (1)
(1)
Impairment losses related to Madison are included within “Loss from joint ventures” for the year ended December 28, 2014. See Note 5 for
additional information.
The impairment of assets in 2014 reflects the impairment of one of our investments in joint ventures, Madison.
During the fourth quarter of 2014, we estimated the fair value less cost to sell of the group held for sale, using
unobservable inputs (Level 3). We recorded a $9.2 million non-cash charge in the fourth quarter of 2014. Our
proportionate share of the loss was $4.7 million after tax and adjusted for the allocation of the loss to the non-
controlling interest.
Financial Instruments Disclosed, But Not Reported, at Fair Value
Our marketable securities, which include U.S. Treasury securities, corporate debt securities, U.S. government
agency securities, municipal securities, certificates of deposit and commercial paper, are recorded at amortized cost
(see Note 3). As of December 25, 2016 and December 27, 2015, the amortized cost approximated fair value because of
the short-term maturity and highly liquid nature of these investments. We classified these investments as Level 2
since the fair value estimates are based on market observable inputs for investments with similar terms and
maturities.
The carrying value of our long-term debt was approximately $240 million as of December 25, 2016 and $236
million as of December 27, 2015. The fair value of our long-term debt was approximately $298 million as of
December 25, 2016 and $316 million as of December 27, 2015. We estimate the fair value of our debt utilizing market
quotations for debt that have quoted prices in active markets. Since our debt does not trade on a daily basis in an
active market, the fair value estimates are based on market observable inputs based on borrowing rates currently
available for debt with similar terms and average maturities (Level 2).
9. Pension Benefits
Single-Employer Plans
We sponsor several single-employer defined benefit pension plans, the majority of which have been frozen. We
also participate in two joint Company and Guild-sponsored plans covering employees who are members of The News
Guild of New York, including The Newspaper Guild of New York - The New York Times Pension Fund, which was
frozen in 2012, and replaced by The Guild-Times Adjustable Pension Plan.
We also have a foreign-based pension plan for certain employees (the “foreign plan”). The information for the
foreign plan is combined with the information for U.S. non-qualified plans. The benefit obligation of the foreign plan
is immaterial to our total benefit obligation.
THE NEW YORK TIMES COMPANY – P. 73
Net Periodic Pension Cost
The components of net periodic pension cost were as follows:
(In thousands)
Service cost
Interest cost
December 25, 2016
December 27, 2015
December 28, 2014
Qualified
Plans
Non-
Qualified
Plans
All
Plans
Qualified
Plans
Non-
Qualified
Plans
All
Plans
Qualified
Plans
Non-
Qualified
Plans
All
Plans
$
8,991 $
143 $
9,134
$ 11,932 $
157 $ 12,089
$
9,543 $
184 $
9,727
66,293
8,172
74,465
74,536
10,060
84,596
84,447
10,450
94,897
Expected return on plan assets
(111,159)
— (111,159)
(115,261)
— (115,261)
(113,839)
— (113,839)
Amortization and other costs
28,274
4,184
32,458
36,442
5,081
41,523
26,620
4,718
31,338
Amortization of prior service
(credit)/cost
(1,945)
—
(1,945)
(1,945)
Effect of settlement/curtailment
21,294
(1,599)
19,695
40,329
—
—
(1,945)
(1,945)
—
(1,945)
40,329
—
9,525
9,525
Net periodic pension cost
$ 11,748 $ 10,900 $ 22,648
$ 46,033 $ 15,298 $ 61,331
$
4,826 $ 24,877 $ 29,703
As part of our strategy to reduce the size and volatility of our pension obligations, we have offered lump-sum
payments to certain former employees participating in both our qualified and non-qualified pension plans. In the
fourth quarter of 2016, we recorded a pension settlement charge of $21.3 million in connection with a lump-sum
payment offer made to certain former employees who participated in certain qualified pension plans. These lump-
sum payments totaled $49.5 million and were made with cash from the qualified pension plans, not with Company
cash. The effect of this lump-sum payment offer was to reduce our pension obligations by $52.2 million. In addition,
we recorded a $1.6 million curtailment related to the streamlining of the Company’s international print operations.
See Note 7 for more information on the streamlining of the Company’s international print operations.
In the first quarter of 2015, we recorded a pension settlement charge of $40.3 million in connection with a lump-
sum payment offer made to certain former employees who participated in certain qualified pension plans. These
lump-sum payments totaled $98.3 million and were made with cash from the qualified pension plans, not with
Company cash. The effect of this lump-sum payment offer was to reduce our pension obligations by $142.8 million.
In the second quarter of 2014, we recorded a pension settlement charge of $9.5 million in connection with a
lump-sum payment offer made to certain former employees who participated in certain non-qualified pension plans.
These lump-sum payments totaled $24.0 million and were paid out of Company cash. The effect of this lump-sum
payment offer was to reduce our pension obligations by $32.0 million.
P. 74 – THE NEW YORK TIMES COMPANY
Other changes in plan assets and benefit obligations recognized in other comprehensive income/loss were as
follows:
(In thousands)
Net actuarial (gain)/loss
Amortization of loss
Amortization of prior service cost
Effect of curtailment
Effect of settlement
December 25,
2016
December 27,
2015
December 28,
2014
$
(4,289)
$
31,044
$
254,525
(32,458)
(41,523)
(30,665)
1,945
—
1,945
(1,264)
1,945
—
(21,294)
(40,329)
(9,525)
Total recognized in other comprehensive (income)/loss
(56,096)
(50,127)
216,280
Net periodic pension cost
22,648
61,331
29,703
Total recognized in net periodic benefit cost and other comprehensive (income)/
loss
$
(33,448)
$
11,204
$
245,983
The estimated actuarial loss and prior service credit that will be amortized from accumulated other
comprehensive loss into net periodic pension cost over the next fiscal year is approximately $34 million and $2
million, respectively.
In the fourth quarter of 2015, the Company’s ERISA Management Committee made a decision to freeze the
accrual of benefits under the Retirement Annuity Plan For Craft Employees of The New York Times Companies with
respect to all participants covered by a collective bargaining agreement between the Company and The New York
Newspaper Printing Pressmen’s Union No. 2N/1SE, effective as of the close of business on December 31, 2015. As a
result, we recorded a curtailment of $1.3 million in 2015.
The amount of cost recognized for defined contribution benefit plans was approximately $15 million for 2016,
$16 million for 2015 and $17 million for 2014.
THE NEW YORK TIMES COMPANY – P. 75
Benefit Obligation and Plan Assets
The changes in the benefit obligation and plan assets and other amounts recognized in other comprehensive
loss were as follows:
(In thousands)
Change in benefit obligation
December 25, 2016
December 27, 2015
Qualified
Plans
Non-
Qualified
Plans
All Plans
Qualified
Plans
Non-
Qualified
Plans
All Plans
Benefit obligation at beginning of year
$ 1,851,910
$ 247,087
$ 2,098,997
$ 2,101,573
$
267,824
$ 2,369,397
Service cost
Interest cost
8,991
143
9,134
11,932
157
12,089
66,293
8,172
74,465
74,536
10,060
84,596
Plan participants’ contributions
9
—
9
20
—
20
Actuarial loss/(gain)
Curtailments
23,994
2,695
26,689
(129,187)
(14,372)
(143,559)
—
(1,599)
(1,599)
(1,264)
—
—
(1,264)
(98,348)
Lump-sum settlement paid
(48,413)
—
(48,413)
(98,348)
Benefits paid
(104,132)
(15,992)
(120,124)
(107,352)
(16,231)
(123,583)
Effects of change in currency conversion
—
(107)
(107)
—
(351)
(351)
Benefit obligation at end of year
1,798,652
240,399
2,039,051
1,851,910
247,087
2,098,997
Change in plan assets
Fair value of plan assets at beginning of year
1,579,356
Actual return on plan assets
142,137
—
—
1,579,356
1,837,250
142,137
(59,342)
—
—
1,837,250
(59,342)
Employer contributions
7,803
15,992
23,795
7,128
16,231
23,359
Plan participants’ contributions
Lump-sum settlement paid
9
(48,413)
—
—
9
20
(48,413)
(98,348)
—
—
20
(98,348)
Benefits paid
(104,132)
(15,992)
(120,124)
(107,352)
(16,231)
(123,583)
Fair value of plan assets at end of year
1,576,760
—
1,576,760
1,579,356
—
1,579,356
Net amount recognized
$ (221,892)
$ (240,399)
$ (462,291)
$ (272,554)
$ (247,087)
$ (519,641)
Amount recognized in the Consolidated Balance Sheets
Current liabilities
Noncurrent liabilities
$
— $
(16,818)
$
(16,818)
$
— $
(16,043)
$
(16,043)
(221,892)
(223,581)
(445,473)
(272,554)
(231,044)
(503,598)
Net amount recognized
$ (221,892)
$ (240,399)
$ (462,291)
$ (272,554)
$ (247,087)
$ (519,641)
Amount recognized in accumulated other comprehensive loss
Actuarial loss
Prior service credit
Total
$
765,096
$
98,855
$ 863,951
$ 821,648
$
100,344
$
921,992
(22,676)
—
(22,676)
(24,621)
—
(24,621)
$
742,420
$
98,855
$ 841,275
$ 797,027
$
100,344
$
897,371
The accumulated benefit obligation for all pension plans was $2.0 billion and $2.1 billion as of December 25,
2016 and December 27, 2015, respectively.
P. 76 – THE NEW YORK TIMES COMPANY
Information for pension plans with an accumulated benefit obligation in excess of plan assets was as follows:
(In thousands)
Projected benefit obligation
Accumulated benefit obligation
Fair value of plan assets
Assumptions
December 25,
2016
December 27,
2015
$
$
$
2,039,051
2,034,636
1,576,760
$
$
$
2,098,997
2,092,600
1,579,356
Weighted-average assumptions used in the actuarial computations to determine benefit obligations for
qualified pension plans were as follows:
Discount rate
Rate of increase in compensation levels
December 25,
2016
December 27,
2015
4.31%
2.95%
4.60%
2.96%
The rate of increase in compensation levels is applicable only for qualified pension plans that have not been
frozen.
Weighted-average assumptions used in the actuarial computations to determine net periodic pension cost for
qualified plans were as follows:
Discount rate for determining projected benefit obligation
Discount rate in effect for determining service cost
Discount rate in effect for determining interest cost
Rate of increase in compensation levels
Expected long-term rate of return on assets
December 25,
2016
December 27,
2015
December 28,
2014
4.60%
5.78%
3.68%
2.91%
7.01%
4.05%
4.05%
4.05%
2.89%
7.01%
4.90%
4.90%
4.90%
2.87%
7.02%
Weighted-average assumptions used in the actuarial computations to determine benefit obligations for non-
qualified plans were as follows:
Discount rate
Rate of increase in compensation levels
December 25,
2016
December 27,
2015
4.17%
2.50%
4.40%
2.50%
The rate of increase in compensation levels is applicable only for the non-qualified pension plans that have not
been frozen.
THE NEW YORK TIMES COMPANY – P. 77
Weighted-average assumptions used in the actuarial computations to determine net periodic pension cost for
non-qualified plans were as follows:
Discount rate for determining projected benefit obligation
Discount rate in effect for determining interest cost
Rate of increase in compensation levels
December 25,
2016
December 27,
2015
December 28,
2014
4.40%
3.44%
2.50%
3.90%
3.90%
2.50%
4.60%
4.60%
2.50%
We determined our discount rate using a Ryan ALM, Inc. Curve (the “Ryan Curve”). The Ryan Curve provides
the bonds included in the curve and allows adjustments for certain outliers (i.e., bonds on “watch”). We believe the
Ryan Curve allows us to calculate an appropriate discount rate.
To determine our discount rate, we project a cash flow based on annual accrued benefits. The projected plan
cash flow is discounted to the measurement date, which is the last day of our fiscal year, using the annual spot rates
provided in the Ryan Curve.
In determining the expected long-term rate of return on assets, we evaluated input from our investment
consultants, actuaries and investment management firms, including our review of asset class return expectations, as
well as long-term historical asset class returns. Projected returns by such consultants and economists are based on
broad equity and bond indices. Our objective is to select an average rate of earnings expected on existing plan assets
and expected contributions to the plan during the year, less expense expected to be incurred by the plan during the
year.
The market-related value of plan assets is multiplied by the expected long-term rate of return on assets to
compute the expected return on plan assets, a component of net periodic pension cost. The market-related value of
plan assets is a calculated value that recognizes changes in fair value over three years.
In October 2014, the Society of Actuaries (“SOA”) released new mortality tables that increased life expectancy
assumptions. During the fourth quarter of 2014, we adopted the new mortality tables and revised the mortality
assumptions used in determining our pension and postretirement benefit obligations. The net impact to our qualified
and non-qualified pension obligations resulting from the new mortality assumptions in 2014 was an increase of $117.0
million.
In October 2016, the SOA released new mortality tables that decreased life expectancy assumptions. During the
fourth quarter of 2016, we adopted the new mortality tables and revised the mortality assumptions used in
determining our pension and postretirement benefit obligations. The net impact to our qualified and non-qualified
pension obligations resulting from the new mortality assumptions in 2016 was a decrease of $34.7 million.
For fiscal year 2016, we changed the approach used to calculate the service and interest components of net
periodic benefit cost for benefit plans to provide a more precise measurement of service and interest costs.
Historically, we calculated these service and interest components utilizing a single weighted-average discount rate
derived from the yield curve used to measure the benefit obligation at the beginning of the period. We elected to
utilize an approach that discounts the individual expected cash flows using the applicable spot rates derived from the
yield curve over the projected cash flow period. The spot rates used to determine service and interest costs ranged
from 1.32% to 4.79%. Service costs and interest costs for our pension plans were reduced by approximately $18 million
due to the change in methodology.
Plan Assets
Company-Sponsored Pension Plans
The assets underlying the Company-sponsored qualified pension plans are managed by professional
investment managers. These investment managers are selected and monitored by the pension investment committee,
composed of certain senior executives, who are appointed by the Finance Committee of the Board of Directors of the
Company. The Finance Committee is responsible for adopting our investment policy, which includes rules regarding
the selection and retention of qualified advisors and investment managers. The pension investment committee is
responsible for implementing and monitoring compliance with our investment policy, selecting and monitoring
P. 78 – THE NEW YORK TIMES COMPANY
investment managers and communicating the investment guidelines and performance objectives to the investment
managers.
Our contributions are made on a basis determined by the actuaries in accordance with the funding
requirements and limitations of the Employee Retirement Income Security Act (“ERISA”) and the Internal Revenue
Code.
Investment Policy and Strategy
The primary long-term investment objective is to allocate assets in a manner that produces a total rate of return
that meets or exceeds the growth of our pension liabilities. Our investment objective is to transition the asset mix to
hedge liabilities and minimize volatility in the funded status of the plans.
Asset Allocation Guidelines
In accordance with our asset allocation strategy, for substantially all of our Company-sponsored pension plan
assets, investments are categorized into long duration fixed income investments whose value is highly correlated to
that of the pension plan obligations (“Long Duration Assets”) or other investments, such as equities and high-yield
fixed income securities, whose return over time is expected to exceed the rate of growth in our pension plan
obligations (“Return-Seeking Assets”).
The proportional allocation of assets between Long Duration Assets and Return-Seeking Assets is dependent on
the funded status of each pension plan. Under our policy, for example, a funded status between 95% and 97.5%
requires an allocation of total assets of 53% to 63% to Long Duration Assets and 37% to 47% to Return-Seeking Assets.
As a plan's funded status increases, the allocation to Long Duration Assets will increase and the allocation to Return-
Seeking Assets will decrease.
The following asset allocation guidelines apply to the Return-Seeking Assets:
Asset Category
Public Equity
Growth Fixed Income
Alternatives
Cash
Percentage Range
70%
0%
0%
0%
-
-
-
-
90%
15%
15%
10%
The asset allocations of our Company-sponsored pension plans by asset category for both Long Duration and
Return-Seeking Assets, as of December 25, 2016, were as follows:
Asset Category
Public Equity
Fixed Income
Alternatives
Cash
Percentage
45%
51%
3%
1%
The specified target allocation of assets and ranges set forth above are maintained and reviewed on a periodic
basis by the pension investment committee. The pension investment committee may direct the transfer of assets
between investment managers in order to rebalance the portfolio in accordance with approved asset allocation ranges
to accomplish the investment objectives for the pension plan assets.
THE NEW YORK TIMES COMPANY – P. 79
Fair Value of Plan Assets
The fair value of the assets underlying our Company-sponsored qualified pension plans and The Newspaper
Guild of New York - The New York Times Pension Fund by asset category are as follows:
Fair Value Measurement at December 25, 2016
Quoted Prices
Markets for
Identical Assets
Significant
Observable
Inputs
Significant
Unobservable
Inputs
Investment
Measured at Net
Asset Value (4)
(Level 1)
(Level 2)
(Level 3)
Total
(In thousands)
Asset Category(1)
Equity Securities:
U.S. Equities
$
61,327
$
— $
— $
— $
International Equities
Mutual Funds
Registered Investment Companies
Common/Collective Funds(2)
Fixed Income Securities:
Corporate Bonds
U.S. Treasury and Other
Government Securities
Group Annuity Contract
Municipal and Provincial Bonds
Government Sponsored
Enterprises(3)
Other
Cash and Cash Equivalents
Private Equity
Hedge Fund
48,494
49,869
30,870
—
—
—
—
—
—
—
—
—
—
—
—
—
—
376,289
128,179
—
33,115
7,227
4,486
—
—
—
Assets at Fair Value
190,560
549,296
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
61,327
48,494
49,869
30,870
701,577
701,577
—
—
54,872
—
—
—
22,829
24,931
31,939
376,289
128,179
54,872
33,115
7,227
4,486
22,829
24,931
31,939
836,148
1,576,004
756
Other Assets
Total
$
190,560
$
549,296
$
— $
836,148
$
1,576,760
(1)
Includes the assets of The Guild-Times Adjustable Pension Plan and the Retirement Annuity Plan which are not part of the Master Trust.
(2) The underlying assets of the common/collective funds are primarily comprised of equity and fixed income securities. The fair value in the
above table represents our ownership share of the net asset value (“NAV”) of the underlying funds.
(3) Represents investments that are not backed by the full faith and credit of the United States government.
(4) Certain investments that are measured at fair value using the NAV per share (or its equivalent) have not been classified in the fair value
hierarchy.
P. 80 – THE NEW YORK TIMES COMPANY
Fair Value Measurement at December 27, 2015
Quoted Prices
Markets for
Identical Assets
Significant
Observable
Inputs
Significant
Unobservable
Inputs
Investment
Measured at Net
Asset Value (4)
(Level 1)
(Level 2)
(Level 3)
Total
(In thousands)
Asset Category(1)
Equity Securities:
U.S. Equities
$
47,136
$
— $
— $
— $
International Equities
Mutual Funds
Registered Investment Companies
Common/Collective Funds(2)
Fixed Income Securities:
Corporate Bonds
U.S. Treasury and Other
Government Securities
Group Annuity Contract
Municipal and Provincial Bonds
Government Sponsored
Enterprises(3)
Other
Cash and Cash Equivalents
Private Equity
Hedge Fund
48,834
52,861
20,971
—
—
—
—
—
—
—
—
—
—
—
—
—
—
417,554
119,098
—
36,912
6,250
11,511
—
—
—
Assets at Fair Value
169,802
591,325
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
47,136
48,834
52,861
20,971
687,980
687,980
—
—
56,275
—
—
—
12,255
29,707
31,243
417,554
119,098
56,275
36,912
6,250
11,511
12,255
29,707
31,243
817,460
1,578,587
769
Other Assets
Total
$
169,802
$
591,325
$
— $
817,460
$
1,579,356
(1)
Includes the assets of The Guild-Times Adjustable Pension Plan and the Retirement Annuity Plan which are not part of the Master Trust.
(2) The underlying assets of the common/collective funds are primarily comprised of equity and fixed income securities. The fair value in the
above table represents our ownership share of the net asset value (“NAV”) of the underlying funds.
(3) Represents investments that are not backed by the full faith and credit of the United States government.
(4) Certain investments that are measured at fair value using the NAV per share (or its equivalent) have not been classified in the fair value
hierarchy.
Level 1 and Level 2 Investments
Where quoted prices are available in an active market for identical assets, such as equity securities traded on an
exchange, transactions for the asset occur with such frequency that the pricing information is available on an
ongoing/daily basis. We classify these types of investments as Level 1 where the fair value represents the closing/last
trade price for these particular securities.
For our investments where pricing data may not be readily available, fair values are estimated by using quoted
prices for similar assets, in both active and not active markets, and observable inputs, other than quoted prices, such
as interest rates and credit risk. We classify these types of investments as Level 2 because we are able to reasonably
estimate the fair value through inputs that are observable, either directly or indirectly. There are no restrictions on our
ability to sell any of our Level 1 and Level 2 investments.
THE NEW YORK TIMES COMPANY – P. 81
Cash Flows
In August 2014, the Highway and Transportation Funding Act of 2014 was enacted. The legislation extended
interest rate stabilization for single-employer defined benefit pension plan funding for an additional five years. In
2016, we made contributions to qualified pension plans of $7.8 million. We expect contributions to total
approximately $9 million to satisfy minimum funding requirements in 2017.
The following benefit payments, which reflect future service for plans that have not been frozen, are expected to
be paid:
(In thousands)
2017
2018
2019
2020
2021
2022-2026(1)
Plans
Qualified
Non-
Qualified
Total
$
104,974
$
17,136
$
122,110
105,560
106,665
107,636
108,888
561,671
17,121
16,998
16,738
16,599
79,433
122,681
123,663
124,374
125,487
641,104
(1) While benefit payments under these plans are expected to continue beyond 2026, we have presented in this table only those benefit
payments estimated over the next 10 years.
Multiemployer Plans
We contribute to a number of multiemployer defined benefit pension plans under the terms of various
collective bargaining agreements that cover our union-represented employees. In recent years, certain events, such as
amendments to various collective bargaining agreements and the sale of the New England Media Group, resulted in
withdrawals from multiemployer pension plans. These actions, along with a reduction in covered employees, have
resulted in us estimating withdrawal liabilities to the respective plans for our proportionate share of any unfunded
vested benefits. In 2016 and 2015, we recorded $6.7 million and $9.1 million in charges for partial withdrawal
obligations under multiemployer pension plans, respectively. There was no such charge in 2014.
Our multiemployer pension plan withdrawal liability was approximately $113 million as of December 25, 2016
and approximately $124 million as of December 27, 2015. The decrease was due to the settlement of various
withdrawal liabilities in 2016. This liability represents the present value of the obligations related to complete and
partial withdrawals that have already occurred as well as an estimate of future partial withdrawals that we
considered probable and reasonably estimable. For those plans that have yet to provide us with a demand letter, the
actual liability will not be fully known until they complete a final assessment of the withdrawal liability and issue a
demand to us. Therefore, the estimate of our multiemployer pension plan liability will be adjusted as more
information becomes available that allows us to refine our estimates.
The risks of participating in multiemployer plans are different from single-employer plans in the following
aspects:
• Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees
of other participating employers.
•
•
•
If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne
by the remaining participating employers.
If we elect to withdraw from these plans or if we trigger a partial withdrawal due to declines in contribution
base units or a partial cessation of our obligation to contribute, we may be assessed a withdrawal liability
based on a calculated share of the underfunded status of the plan.
If a multiemployer plan from which we have withdrawn subsequently experiences a mass withdrawal, we
may be required to make additional contributions under applicable law.
P. 82 – THE NEW YORK TIMES COMPANY
Our participation in significant plans for the fiscal period ended December 25, 2016, is outlined in the table
below. The “EIN/Pension Plan Number” column provides the Employer Identification Number (“EIN”) and the
three-digit plan number. The zone status is based on the latest information that we received from the plan and is
certified by the plan’s actuary. A plan is generally classified in critical status if a funding deficiency is projected within
four years or five years. A plan in critical status is classified in critical and declining status if it is projected to become
insolvent in the next 15 or 20 years, depending on other criteria. A plan is classified in endangered status if its funded
percentage is less than 80% or a funding deficiency is projected within seven years. If the plan satisfies both of these
triggers, it is classified in seriously endangered status. A plan not classified in any other status is classified in the
green zone. The “FIP/RP Status Pending/Implemented” column indicates plans for which a financial improvement
plan (“FIP”) or a rehabilitation plan (“RP”) is either pending or has been implemented. The “Surcharge Imposed”
column includes plans in a red zone status that are required to pay a surcharge in excess of regular contributions. The
last column lists the expiration date(s) of the collective bargaining agreement(s) to which the plans are subject.
Pension Fund
EIN/Pension
Plan Number
2016
2015
FIP/RP Status
Pending/
Implemented
Pension Protection Act
Zone Status
(In thousands)
Contributions of the
Company
2016
2015
2014
Surcharge
Imposed
Collective
Bargaining
Agreement
Expiration
Date
CWA/ITU Negotiated
Pension Plan
Newspaper and Mail
Deliverers’-Publishers’
Pension Fund
Critical
and
Declining
as of
1/01/16
Critical as
of 1/01/15
13-6212879-001
Implemented
$
486 $
543 $
611
No
(1)
13-6122251-001
Green as
of 6/01/16
Green as of
6/01/15
N/A
1,040
1,038
1,102
No
3/30/2020(2)
GCIU-Employer
Retirement Benefit
Plan
91-6024903-001
Critical
and
Declining
as of
1/01/16
Critical and
Declining
as of
1/01/15
Implemented
43
57
58
Yes
3/30/2021(3)
Pressmen’s Publishers’
Pension Fund
13-6121627-001
Green as
of 4/01/16
Green as of
4/01/15
N/A
1,001
1,033
1,097
No
3/30/2021(4)
Paper-Handlers’-
Publishers’ Pension
Fund
13-6104795-001
Critical
and
Declining
as of
4/01/16
Critical and
Declining
as of
4/01/15
Contributions for individually significant plans
Total Contributions
Pending
100
97
103
Yes
3/30/2021(5)
$ 2,670 $ 2,768 $ 2,971
$ 2,670 $ 2,768 $ 2,971
(1) There are two collective bargaining agreements requiring contributions to this plan, Mailers expire March 30, 2019 and Typographers expired
March 30, 2016.
(2) Elections under the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010: Extended Amortization of Net
Investment Losses (IRS Section 431(b)(8)(A)) and the Expanded Smoothing Period (IRS Section 431(b)(8)(B)).
(3) We previously had two collective bargaining agreements requiring contributions to this plan. With the sale of the New England Media Group
only one collective bargaining agreement remains for the Stereotypers, which expires March 30, 2021. The method for calculating actuarial
value of assets was changed retroactive to January 1, 2009, as elected by the Board of Trustees and as permitted by IRS Notice 2010-83. This
election includes smoothing 2008 investment losses over ten years.
(4) The Plan sponsor elected two provisions of funding relief under the Preservation of Access to Care for Medicare Beneficiaries and Pension
Relief Act of 2010 (PRA 2010) to more slowly absorb the 2008 plan year investment loss, retroactively effective as of April 1, 2009. These
included extended amortization under the prospective method and 10-year smoothing of the asset loss for the plan year beginning April 1,
2008.
(5) Board of Trustees elected funding relief. This election includes smoothing the March 31, 2009 investment losses over 10 years.
The rehabilitation plan for the GCIU-Employer Retirement Benefit Plan includes minimum annual
contributions no less than the total annual contribution made by us from September 1, 2008 through August 31, 2009.
THE NEW YORK TIMES COMPANY – P. 83
The Company was listed in the plans’ respective Forms 5500 as providing more than 5% of the total
contributions for the following plans and plan years:
Pension Fund
CWA/ITU Negotiated Pension Plan
Newspaper and Mail Deliverers’-Publishers’ Pension Fund
Pressmen’s Publisher’s Pension Fund
Paper-Handlers’-Publishers’ Pension Fund
Year Contributions to Plan Exceeded More Than 5 Percent of
Total Contributions (as of Plan’s Year-End)
12/31/2015 & 12/31/2014(1)
5/31/2015 & 5/31/2014(1)
3/31/2016 & 3/31/2015
3/31/2016 & 3/31/2015
(1) Forms 5500 for the plans’ year ended of 12/31/16 and 5/31/16 were not available as of the date we filed our financial statements.
The Company received a notice and demand for payment of withdrawal liability from the Newspaper and Mail
Deliverers’-Publishers’ Pension Fund in September 2013 and December 2014 associated with partial withdrawals. See
Note 18 for further information.
10. Other Postretirement Benefits
We provide health benefits to retired employees (and their eligible dependents) who meet the definition of an
eligible participant and certain age and service requirements, as outlined in the plan document. While we offer pre-
age 65 retiree medical coverage to employees who meet certain retiree medical eligibility requirements, we do not
provide post-age 65 retiree medical benefits for employees who retired on or after March 1, 2009. We also contribute to
a postretirement plan for Guild employees of The New York Times under the provisions of a collective bargaining
agreement. We accrue the costs of postretirement benefits during the employees’ active years of service and our policy
is to pay our portion of insurance premiums and claims from our assets.
Net Periodic Other Postretirement Benefit (Income)/Expense
The components of net periodic postretirement benefit (income)/expense were as follows:
(In thousands)
Service cost
Interest cost
Amortization and other costs
Amortization of prior service credit
December 25,
2016
December 27,
2015
December 28,
2014
$
417
$
588
$
1,979
4,105
2,794
5,197
580
3,722
7,299
(8,440)
(9,495)
(7,199)
Net periodic postretirement benefit (income)/expense
$
(1,939)
$
(916)
$
4,402
In September 2014 and December 2014, the ERISA Management Committee approved certain changes to The
New York Times Company Retiree Medical Plan provisions, which triggered a remeasurement under ASC 715-60,
“Compensation — Retirement Benefits — Defined Benefit Plans — Other Postretirement.” The changes in the plan
provisions decreased obligations by $25.5 million and the change in discount rate as of the remeasurement date
increased obligations by $3.6 million. Overall, the remeasurement decreased our obligations by $21.9 million as
reflected in other comprehensive income in our Consolidated Balance Sheets and Consolidated Statements of
Comprehensive Income/(Loss).
P. 84 – THE NEW YORK TIMES COMPANY
The changes in the benefit obligations recognized in other comprehensive income/loss were as follows:
(In thousands)
Net actuarial loss/(gain)
Prior service cost/(credit)
Amortization of loss
Amortization of prior service credit
Total recognized in other comprehensive loss/(income)
Net periodic postretirement benefit (income)/expense
December 25,
2016
December 27,
2015
December 28,
2014
$
28
$
(5,543)
$
8,882
—
(4,105)
8,440
4,363
(1,939)
1,145
(5,197)
9,495
(100)
(916)
(25,489)
(4,948)
7,199
(14,356)
4,402
Total recognized in net periodic postretirement benefit income and other
comprehensive loss/(income)
$
2,424
$
(1,016)
$
(9,954)
The estimated actuarial loss and prior service credit that will be amortized from accumulated other
comprehensive loss into net periodic benefit cost over the next fiscal year is approximately $3 million and $8 million,
respectively.
In connection with collective bargaining agreements, we contribute to several multiemployer welfare plans.
These plans provide medical benefits to active and retired employees covered under the respective collective
bargaining agreement. Contributions are made in accordance with the formula in the relevant agreement.
Postretirement costs related to these plans are not reflected above and were approximately $15 million in 2016, $16
million in 2015 and $18 million in 2014.
THE NEW YORK TIMES COMPANY – P. 85
The changes in the benefit obligation and plan assets and other amounts recognized in other comprehensive
income/loss were as follows:
(In thousands)
Change in benefit obligation
December 25,
2016
December 27,
2015
Benefit obligation at beginning of year
$
71,047
$
81,054
Service cost
Interest cost
Plan participants’ contributions
Actuarial loss/(gain)
Plan amendments
Benefits paid
Benefit obligation at the end of year
Change in plan assets
Fair value of plan assets at beginning of year
Employer contributions
Plan participants’ contributions
Benefits paid
Fair value of plan assets at end of year
Net amount recognized
Amount recognized in the Consolidated Balance Sheets
Current liabilities
Noncurrent liabilities
Net amount recognized
Amount recognized in accumulated other comprehensive loss
Actuarial loss
Prior service credit
Total
417
1,979
4,409
28
—
588
2,794
4,230
(5,543)
1,145
(12,838)
(13,221)
65,042
71,047
—
8,429
4,409
—
8,991
4,230
(12,838)
(13,221)
—
—
(65,042)
$
(71,047)
(7,043)
$
(8,168)
(57,999)
(62,879)
(65,042)
$
(71,047)
22,522
$
26,599
(32,870)
(41,309)
(10,348)
$
(14,710)
$
$
$
$
$
Weighted-average assumptions used in the actuarial computations to determine the postretirement benefit
obligations were as follows:
Discount rate
Estimated increase in compensation level
December 25,
2016
December 27,
2015
3.94%
3.50%
4.04%
3.50%
P. 86 – THE NEW YORK TIMES COMPANY
Weighted-average assumptions used in the actuarial computations to determine net periodic postretirement
cost were as follows:
Discount rate for determining projected benefit obligation
Discount rate in effect for determining service cost
Discount rate in effect for determining interest cost
Estimated increase in compensation level
The assumed health-care cost trend rates were as follows:
Health-care cost trend rate
Rate to which the cost trend rate is assumed to decline (ultimate trend rate)
Year that the rate reaches the ultimate trend rate
December 25,
2016
December 27,
2015
December 28,
2014
4.05%
4.24%
2.96%
3.50%
3.74%
3.74%
3.74%
3.50%
4.22%
4.22%
4.22%
3.50%
December 25,
2016
December 27,
2015
8.00%
5.00%
2025
7.20%
5.00%
2023
Because our health-care plans are capped for most participants, the assumed health-care cost trend rates do not
have a significant effect on the amounts reported for the health-care plans. A one-percentage point change in assumed
health-care cost trend rates would have the following effects:
(In thousands)
Effect on total service and interest cost for 2016
Effect on accumulated postretirement benefit obligation as of December 25, 2016
One-Percentage Point
Increase
Decrease
$
$
56
2,352
$
$
(51)
(2,061)
The following benefit payments (net of plan participant contributions) under our Company’s postretirement
plans, which reflect expected future services, are expected to be paid:
(In thousands)
2017
2018
2019
2020
2021
2022-2026 (1)
$
Amount
7,227
6,795
6,303
5,890
5,466
21,984
(1) While benefit payments under these plans are expected to continue beyond 2026, we have presented in this table only those benefit
payments estimated over the next 10 years.
We accrue the cost of certain benefits provided to former or inactive employees after employment, but before
retirement. The cost is recognized only when it is probable and can be estimated. Benefits include life insurance,
disability benefits and health-care continuation coverage. The accrued obligation for these benefits amounted to $11.4
million as of December 25, 2016 and $12.9 million as of December 27, 2015.
In October 2014, the SOA released new mortality tables that increased life expectancy assumptions. During the
fourth quarter of 2014, we adopted the new mortality tables and revised the mortality assumptions used in
determining our pension and postretirement benefit obligations. The net impact to our postretirement obligations
resulting from the new mortality assumptions was an increase of $4.2 million.
THE NEW YORK TIMES COMPANY – P. 87
In October 2016, the SOA released new mortality tables that decreased life expectancy assumptions. During the
fourth quarter of 2016, we adopted the new mortality tables and revised the mortality assumptions used in
determining our pension and postretirement benefit obligations. The net impact to our qualified and non-qualified
pension obligations resulting from the new mortality assumptions in 2016 was a decrease of $1.2 million.
For fiscal year 2016, we changed the approach used to calculate the service and interest components of net
periodic benefit cost for benefit plans to provide a more precise measurement of service and interest costs.
Historically, we calculated these service and interest components utilizing a single weighted-average discount rate
derived from the yield curve used to measure the benefit obligation at the beginning of the period. We have elected to
utilize an approach that discounts the individual expected cash flows using the applicable spot rates derived from the
yield curve over the projected cash flow period. The spot rates used to determine service and interest costs ranged
from 1.32% to 4.79%. Service costs and interest costs for our postretirement plans were reduced by approximately $1
million due to the change in methodology.
11. Other Liabilities
The components of the “Other Liabilities — Other” balance in our Consolidated Balance Sheets were as follows:
(In thousands)
Deferred compensation
Other liabilities
Total
December 25,
2016
December 27,
2015
$
$
31,006
$
35,578
47,641
56,645
78,647
$
92,223
Deferred compensation consists primarily of deferrals under our DEC. The DEC enabled certain eligible
executives to elect to defer a portion of their compensation on a pre-tax basis. Participation in the DEC was frozen
effective December 31, 2015, and no new contributions may be made into the plan.
We invest deferred compensation in life insurance products designed to closely mirror the performance of the
investment funds that the participants select. Our investments in life insurance products are included in
“Miscellaneous assets” in our Consolidated Balance Sheets, and were $34.8 million as of December 25, 2016 and $71.9
million as of December 27, 2015.
Other liabilities in the preceding table primarily included our post employment liabilities, our contingent tax
liability for uncertain tax positions and self-insurance liabilities as of December 25, 2016.
P. 88 – THE NEW YORK TIMES COMPANY
12. Income Taxes
Reconciliations between the effective tax rate on income from continuing operations before income taxes and
the federal statutory rate are presented below.
(In thousands)
Tax at federal statutory rate
State and local taxes, net
Effect of enacted changes in tax laws
December 25, 2016
December 27, 2015
December 28, 2014
Amount
% of
Pre-tax
Amount
% of
Pre-tax
Amount
% of
Pre-tax
$ 10,685
35.0
$ 33,863
35.0
$ 10,448
3,095
—
10.1
—
5,093
1,801
5.2
1.8
4,620
1,393
35.0
15.5
4.7
Reduction in uncertain tax positions
(4,534)
(14.9)
(2,545)
(2.6)
(21,147)
(70.8)
Loss/(gain) on Company-owned life insurance
Nondeductible expense, net
Domestic manufacturing deduction
Foreign Earnings and Dividends
Other, net
(736)
1,115
(1,820)
(2,418)
(966)
(2.4)
3.7
(6.0)
(7.9)
(3.2)
75
880
(2,651)
(1,214)
(1,392)
0.1
0.9
(2.7)
(1.3)
(1.4)
(1,250)
(4.2)
1,847
—
453
95
6.2
—
1.5
0.3
Income tax expense/(benefit)
$
4,421
14.4
$ 33,910
35.0
$
(3,541)
(11.8)
The components of income tax expense as shown in our Consolidated Statements of Operations were as
follows:
(In thousands)
Current tax expense/(benefit)
Federal
Foreign
State and local
Total current tax expense/(benefit)
Deferred tax expense
Federal
State and local
Total deferred tax (benefit)/expense
Income tax expense/(benefit)
December 25,
2016
December 27,
2015
December 28,
2014
$
22,864
$
41,199
$
17,397
312
(3,295)
19,881
485
5,919
47,603
(16,625)
(14,554)
1,165
861
(15,460)
(13,693)
583
(25,625)
(7,645)
4,014
90
4,104
$
4,421
$
33,910
$
(3,541)
State tax operating loss carryforwards totaled $3.4 million as of December 25, 2016 and $3.8 million as of
December 27, 2015. Such loss carryforwards expire in accordance with provisions of applicable tax laws and have
remaining lives up to 17 years.
THE NEW YORK TIMES COMPANY – P. 89
The components of the net deferred tax assets and liabilities recognized in our Consolidated Balance Sheets
were as follows:
(In thousands)
Deferred tax assets
December 25,
2016
December 27,
2015
Retirement, postemployment and deferred compensation plans
$
275,611
$
309,711
Accruals for other employee benefits, compensation, insurance and other
Accounts receivable allowances
Net operating losses
Investment in joint ventures
Other
Gross deferred tax assets
Valuation allowance
Net deferred tax assets
Deferred tax liabilities
Property, plant and equipment
Intangible assets
Investments in joint ventures
Other
Gross deferred tax liabilities
Net deferred tax asset
34,466
2,450
2,598
5,329
32,731
1,690
38,703
—
39,943
44,099
360,397
426,934
—
(36,204)
360,397
$
390,730
46,284
$
57,065
11,975
—
796
59,055
10,790
11,694
2,039
81,588
$
$
$
301,342
$
309,142
We assess whether a valuation allowance should be established against deferred tax assets based on the
consideration of both positive and negative evidence using a “more likely than not” standard. In making such
judgments, significant weight is given to evidence that can be objectively verified. We evaluated our deferred tax
assets for recoverability using a consistent approach that considers our three-year historical cumulative income/
(loss), including an assessment of the degree to which any such losses were due to items that are unusual in nature
(i.e., impairments of nondeductible goodwill and intangible assets).
As of December 27, 2015, we had a full valuation allowance on net operating losses of $36.2 million associated
with non-U.S. operations, as we determined those losses were not realizable on a more-likely-than-not basis. As of
December 25, 2016, following the streamlining of the Company's international print operations, those net operating
losses were no longer available for use and accordingly both the net operating losses and the associated full valuation
allowance have been removed from the Consolidated Balance Sheets.
Accrued income taxes were $1.9 million and $21.9 million as of December 25, 2016 and December 27, 2015,
respectively.
Income tax benefits related to the exercise or vesting of equity awards reduced current taxes payable by $8.6
million in 2016, $4.4 million in 2015 and $3.1 million in 2014.
As of December 25, 2016 and December 27, 2015, “Accumulated other comprehensive loss, net of income taxes”
in our Consolidated Balance Sheets and for the years then ended in our Consolidated Statements of Changes in
Stockholders’ Equity was net of deferred tax assets of approximately $331 million and $353 million, respectively.
P. 90 – THE NEW YORK TIMES COMPANY
A reconciliation of unrecognized tax benefits is as follows:
(In thousands)
Balance at beginning of year
Gross additions to tax positions taken during the current year
Gross additions to tax positions taken during the prior year
Gross reductions to tax positions taken during the prior year
Reductions from settlements with taxing authorities
December 25,
2016
December 27,
2015
December 28,
2014
$
13,941
$
16,324
$
46,058
997
—
(3,042)
—
1,151
282
(37)
—
2,116
—
(12,109)
(7,114)
Reductions from lapse of applicable statutes of limitations
(1,868)
(3,779)
(12,627)
Balance at end of year
$
10,028
$
13,941
$
16,324
In 2016 and 2015, we recorded a $4.5 million and $2.5 million income tax benefit, respectively, primarily due to a
reduction in the Company’s reserve for uncertain tax positions.
The total amount of unrecognized tax benefits that would, if recognized, affect the effective income tax rate was
approximately $7 million as of December 25, 2016 and $9 million as of December 27, 2015.
We also recognize accrued interest expense and penalties related to the unrecognized tax benefits within income
tax expense or benefit. The total amount of accrued interest and penalties was approximately $3 million and $4 million
as of December 25, 2016 and December 27, 2015, respectively. The total amount of accrued interest and penalties was a
net benefit of $0.9 million in 2016, a net benefit of $0.1 million in 2015 and a net benefit of $8.6 million in 2014.
With few exceptions, we are no longer subject to U.S. federal, state and local, or non-U.S. income tax
examinations by tax authorities for years prior to 2008. Management believes that our accrual for tax liabilities is
adequate for all open audit years. This assessment relies on estimates and assumptions and may involve a series of
complex judgments about future events.
It is reasonably possible that certain income tax examinations may be concluded, or statutes of limitation may
lapse, during the next 12 months, which could result in a decrease in unrecognized tax benefits of $3.6 million that
would, if recognized, impact the effective tax rate.
13. Discontinued Operations
New England Media Group
In the fourth quarter of 2013, we completed the sale of substantially all of the assets and operating liabilities of
the New England Media Group — consisting of The Boston Globe, BostonGlobe.com, Boston.com, the T&G,
Telegram.com and related properties — and our 49% equity interest in Metro Boston, for approximately $70.0 million
in cash, subject to customary adjustments. The net after-tax proceeds from the sale, including a tax benefit, were
approximately $74.0 million. In 2013, we recognized a pre-tax gain of $47.6 million on the sale ($28.1 million after tax),
which was almost entirely comprised of a curtailment gain. This curtailment gain was primarily related to an
acceleration of prior service credits from retiree medical plan amendments announced in prior years, and was due to
a cessation of service for employees at the New England Media Group. Post-closing adjustments in 2014 resulted in a
loss of $0.3 million. In the fourth quarter of 2016, we recorded a charge of $3.7 million ($2.3 million after tax) in
connection with the settlement of litigation involving NEMG T&G, Inc., a subsidiary of the Company that was part of
the New England Media Group. The results of operations of the New England Media Group have been classified as
discontinued operations for all periods presented.
About Group
In the fourth quarter of 2012, we completed the sale of the About Group, consisting of About.com,
ConsumerSearch.com, CalorieCount.com and related businesses, to IAC/InterActiveCorp. for $300.0 million in cash,
plus a net working capital adjustment of approximately $17.0 million. The sale resulted in a pre-tax gain of $96.7
million ($61.9 million after tax) in 2012. The net after-tax proceeds from the sale were approximately $291.0 million. In
the fourth quarter of 2014, there was a legal settlement that resulted in a loss of $0.2 million. The results of operations
THE NEW YORK TIMES COMPANY – P. 91
of the About Group, which had previously been presented as a reportable segment, have been classified as
discontinued operations for 2014.
Regional Media Group
In the first quarter of 2012, we completed the sale of the Regional Media Group, consisting of 16 regional
newspapers, other print publications and related businesses, to Halifax Media Holdings LLC for approximately
$140.0 million in cash. The net after-tax proceeds from the sale, including a tax benefit, were approximately $150.0
million. The sale resulted in an after-tax gain of $23.6 million (including post-closing adjustments recorded in the
second and fourth quarters of 2012 totaling $6.6 million). In the fourth quarter of 2014, there was an environmental
contingency that resulted in a loss of $0.4 million. The results of operations for the Regional Media Group have been
classified as discontinued operations for 2014.
The results of operations for the New England Media Group, About Group and the Regional Media Group
presented as discontinued operations are summarized below for 2016 and 2014. There were no discontinued
operations in 2015.
Year ended
December 25,
2016
Year ended December 28, 2014
New England
Media Group
New England
Media Group About Group
Regional
Media Group
Total
(In thousands)
Income/(loss) from discontinued operations, net of income
taxes
Loss on sale, net of income taxes:
Loss on sale
$
(3,651)
$
(349) $
(229) $
(397) $
Income tax (benefit)/expense
Loss on sale, net of income taxes
(1,378)
(2,273)
(127)
(222)
(93)
(136)
331
(728)
(975)
111
(1,086)
Loss from discontinued operations, net of income
taxes
$
(2,273)
$
(222) $
(136) $
(728) $
(1,086)
14. Earnings/(Loss) Per Share
We compute earnings/(loss) per share using a two-class method, an earnings allocation method used when a
company’s capital structure includes either two or more classes of common stock or common stock and participating
securities. This method determines earnings/(loss) per share based on dividends declared on common stock and
participating securities (i.e., distributed earnings), as well as participation rights of participating securities in any
undistributed earnings.
Earnings/(loss) per share is computed using both basic shares and diluted shares. The difference between basic
and diluted shares is that diluted shares include the dilutive effect of the assumed exercise of outstanding securities.
Our stock options, stock-settled long-term performance awards and restricted stock units could have the most
significant impact on diluted shares. The decrease in our basic shares is primarily due to repurchases of the
Company’s Class A Common Stock.
Securities that could potentially be dilutive are excluded from the computation of diluted earnings per share
when a loss from continuing operations exists or when the exercise price exceeds the market value of our Class A
Common Stock, because their inclusion would result in an anti-dilutive effect on per share amounts.
The number of stock options excluded from the computation of diluted earnings per share because they were
anti-dilutive was approximately 4 million in 2016, 5 million in 2015 and 6 million in 2014.
P. 9(cid:19) – THE NEW YORK TIMES COMPANY
15. Stock-Based Awards
As of December 25, 2016, the Company was authorized to grant stock-based compensation under its 2010
Incentive Compensation Plan (the “2010 Incentive Plan”), which became effective April 27, 2010 and was amended
and restated effective April 30, 2014. The 2010 Incentive Plan replaced the 1991 Executive Stock Incentive Plan (the
“1991 Incentive Plan”). In addition, through April 30, 2014, the Company maintained its 2004 Non-Employee
Directors’ Stock Incentive Plan (the “2004 Directors’ Plan”).
The Company’s long-term incentive compensation program provides executives the opportunity to earn cash
and shares of Class A Common Stock at the end of three-year performance cycles based in part on the achievement of
financial goals tied to a financial metric and in part on stock price performance relative to companies in the Standard
& Poor’s 500 Stock Index, with the majority of the target award to be settled in the Company’s Class A Common
Stock. In addition, the Company grants time-vested restricted stock units annually to a number of employees. These
are settled in shares of Class A Common Stock.
We recognize stock-based compensation expense for these stock-settled long-term performance awards and
restricted stock units, as well as any stock options and stock appreciation rights (together, “Stock-Based Awards”).
Stock-based compensation expense was $12.4 million in 2016, $10.6 million in 2015 and $8.9 million in 2014.
Stock-based compensation expense is recognized over the period from the date of grant to the date when the
award is no longer contingent on the employee providing additional service. Awards under the 1991 Incentive Plan
and 2010 Incentive Plan generally vest over a stated vesting period or, with respect to awards granted prior to
December 28, 2014, upon the retirement of an employee or director, as the case may be.
Prior to 2012, under our 2004 Directors’ Plan, each non-employee director of the Company received annual
grants of non-qualified stock options with 10-year terms to purchase 4,000 shares of Class A Common Stock from the
Company at the average market price of such shares on the date of grants. These grants were replaced with annual
grants of cash-settled phantom stock units in 2012, and, accordingly, no grants of stock options have since been made
under this plan. Under its terms, the 2004 Directors’ Plan terminated as of April 30, 2014.
In 2015, the annual grants of phantom stock units were replaced with annual grants of restricted stock units
under the 2010 Incentive Plan. Restricted stock units are awarded on the date of the annual meeting of stockholders
and vest on the date of the subsequent year’s annual meeting, with the shares to be delivered upon a director’s
cessation of membership on the Board of Directors. Each non-employee director is credited with additional restricted
stock units with a value equal to the amount of all dividends paid on the Company’s Class A Common Stock. The
Company’s directors are considered employees for purposes of stock-based compensation.
Our pool of excess tax benefits (“APIC Pool”) available to absorb tax deficiencies was approximately $25
million as of December 25, 2016.
Stock Options
The 1991 Incentive Plan provided, and the 2010 Incentive Plan provides, for grants of both incentive and non-
qualified stock options at an exercise price equal to the fair market value (as defined in each plan, respectively) of our
Class A Common Stock on the date of grant. Stock options have generally been granted with a 3-year vesting period
and a 10-year term and vest in equal annual installments. Due to a change in the Company’s long-term incentive
compensation, no grants of stock options were made in 2016, 2015 or 2014.
The 2004 Directors’ Plan provided for grants of stock options to non-employee directors at an exercise price
equal to the fair market value (as defined in the 2004 Directors’ Plan) of our Class A Common Stock on the date of
grant. Prior to 2012, stock options were granted with a 1-year vesting period and a 10-year term. No grants of stock
options were made in 2016, 2015 or 2014. The Company’s directors are considered employees for purposes of stock-
based compensation.
THE NEW YORK TIMES COMPANY – P. 93
Changes in our Company’s stock options in 2016 were as follows:
(Shares in thousands)
Options outstanding at beginning of year
Granted
Exercised
Forfeited/Expired
Options outstanding at end of period
Options expected to vest at end of period
Options exercisable at end of period
December 25, 2016
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Term
(Years)
16
—
7
24
14
14
14
Aggregate
Intrinsic
Value
$(000s)
3
$
13,938
3
3
3
$
$
$
12,797
12,797
12,797
Options
6,390
$
—
(115)
(1,757)
4,518
4,518
4,518
$
$
$
The total intrinsic value for stock options exercised was $0.7 million in 2016, $2.7 million in 2015 and $1.5
million in 2014.
The fair value of the stock options granted was estimated on the date of grant using a Black-Scholes valuation
model that uses the following assumptions. The risk-free rate is based on the U.S. Treasury yield curve in effect at the
time of grant. The expected life (estimated period of time outstanding) of stock options granted was determined using
the average of the vesting period and term. Expected volatility was based on historical volatility for a period equal to
the stock option’s expected life, ending on the date of grant, and calculated on a monthly basis. Dividend yield was
based on expected Company dividends, if applicable on the date of grant. The fair value for stock options granted
with different vesting periods and on different dates is calculated separately.
Restricted Stock Units
The 1991 Incentive Plan provided, and the 2010 Incentive Plan provides, for grants of other stock-based awards,
including restricted stock units.
Outstanding stock-settled restricted stock units have been granted with a stated vesting period up to 5 years.
Each restricted stock unit represents our obligation to deliver to the holder one share of Class A Common Stock upon
vesting. The fair value of stock-settled restricted stock units is the average market price on the grant date. Changes in
our Company’s stock-settled restricted stock units in 2016 were as follows:
(Shares in thousands)
Unvested stock-settled restricted stock units at beginning of period
Granted
Vested
Forfeited
Unvested stock-settled restricted stock units at end of period
Unvested stock-settled restricted stock units expected to vest at end of period
December 25, 2016
Restricted
Stock
Units
Weighted
Average
Grant-Date
Fair Value
1,159
$
482
(582)
(51)
1,008
960
$
$
13
13
11
14
14
14
The intrinsic value of stock-settled restricted stock units vested was $7.3 million in 2016, $5.5 million in 2015
and $5.8 million in 2014.
P. 94 – THE NEW YORK TIMES COMPANY
Long-Term Incentive Compensation
The 1991 Incentive Plan provided, and the 2010 Incentive Plan provides, for grants of cash and stock-settled
awards to key executives payable at the end of a multi-year performance period.
Cash-settled awards have been granted with three-year performance periods and are based on the achievement
of specified financial performance measures. Cash-settled awards have been classified as a liability because we
incurred a liability payable in cash. There were payments of approximately $4 million in 2016, $3 million in 2015 and
$1 million in 2014.
Stock-settled awards have been granted with three-year performance periods and are based on relative Total
Shareholder Return (“TSR”), which is calculated at stock appreciation plus deemed reinvested dividends, and another
performance measure. Stock-settled awards are payable in Class A Common Stock and are classified within equity.
The fair value of TSR awards is determined at the date of grant using a market calculation simulation. The fair value
of awards under the other performance measure is determined by the average market price on the grant date.
Compensation expense for TSR-based awards is recognized based on the fair value on the grant date using a
Monte Carlo simulation model. Compensation expense for the other performance measure is based on the expected
number of shares or cash to be delivered as of each reporting date.
Unrecognized Compensation Expense
As of December 25, 2016, unrecognized compensation expense related to the unvested portion of our Stock-
Based Awards was approximately $14 million and is expected to be recognized over a weighted-average period of
1.41 years.
Reserved Shares
We generally issue shares for the exercise of stock options and vesting of stock-settled restricted stock units
from unissued reserved shares.
Shares of Class A Common Stock reserved for issuance were as follows:
(Shares in thousands)
Stock options, stock–settled restricted stock units and stock-settled performance
awards
Stock options and stock-settled restricted stock units
Stock-settled performance awards(1)
Outstanding
Available
Employee Stock Purchase Plan(2)
Available
401(k) Company stock match(3)
Available
Total Outstanding
Total Available
December 25,
2016
December 27,
2015
5,588
3,159
8,747
6,914
7,549
3,531
11,080
7,282
6,410
6,410
3,045
8,747
16,369
3,045
11,080
16,737
(1) The number of shares actually earned at the end of the multi-year performance period will vary, based on actual performance,
from 0% to 200% of the target number of performance awards granted. The maximum number of shares that could be issued
is included in the table above.
(2) We have not had an offering under the Employee Stock Purchase Plan since 2010.
(3) Effective 2014, we no longer offer a Company stock match under the Company’s 401(k) plan.
THE NEW YORK TIMES COMPANY – P. 95
16. Stockholders’ Equity
Shares of our Company’s Class A and Class B Common Stock are entitled to equal participation in the event of
liquidation and in dividend declarations. The Class B Common Stock is convertible at the holders’ option on a share-
for-share basis into Class A Common Stock. Upon conversion, the previously outstanding shares of Class B Common
Stock that were converted are automatically and immediately retired, resulting in a reduction of authorized Class B
Common Stock. As provided for in our Company’s Certificate of Incorporation, the Class A Common Stock has
limited voting rights, including the right to elect 30% of the Board of Directors, and the Class A and Class B Common
Stock have the right to vote together on the reservation of our Company shares for stock options and other stock-
based plans, on the ratification of the selection of a registered public accounting firm and, in certain circumstances, on
acquisitions of the stock or assets of other companies. Otherwise, except as provided by the laws of the State of New
York, all voting power is vested solely and exclusively in the holders of the Class B Common Stock.
There were 816,632 shares as of December 25, 2016 and 816,635 as of December 27, 2015 of Class B Common
Stock issued and outstanding that may be converted into shares of Class A Common Stock.
The Adolph Ochs family trust holds approximately 90% of the Class B Common Stock and, as a result, has the
ability to elect 70% of the Board of Directors and to direct the outcome of any matter that does not require a vote of
the Class A Common Stock.
On January 14, 2015, entities controlled by Carlos Slim Helú, a beneficial owner of our Class A Common Stock,
exercised warrants to purchase 15.9 million shares of our Class A Common Stock at a price of $6.3572 per share, and
the Company received cash proceeds of approximately $101.1 million from this exercise. Concurrently, the Board of
Directors terminated an existing authorization to repurchase shares of the Company’s Class A Common Stock and
approved a new repurchase authorization of $101.1 million, equal to the cash proceeds received by the Company from
the warrant exercise. As of December 25, 2016, total repurchases under this authorization totaled $84.9 million
(excluding commissions) and $16.2 million remained under this authorization. Our Board of Directors has authorized
us to purchase shares from time to time, subject to market conditions and other factors. There is no expiration date
with respect to this authorization.
We may issue preferred stock in one or more series. The Board of Directors is authorized to set the
distinguishing characteristics of each series of preferred stock prior to issuance, including the granting of limited or
full voting rights; however, the consideration received must be at least $100 per share. No shares of preferred stock
were issued or outstanding as of December 25, 2016.
The following table summarizes the changes in AOCI by component as of December 25, 2016:
(In thousands)
Foreign
Currency
Translation
Adjustments
Funded Status
of Benefit
Plans
Total
Accumulated
Other
Comprehensive
Loss
Balance as of December 27, 2015
$
17
$
(509,111)
$
(509,094)
Other comprehensive income before reclassifications, before tax(1)
Amounts reclassified from accumulated other comprehensive loss, before tax(1)
Income tax (benefit)/expense(1)
Net current-period other comprehensive (loss)/income, net of tax
(3,070)
—
(1,231)
(1,839)
3,972
47,472
20,327
31,117
902
47,472
19,096
29,278
Balance as of December 25, 2016
$
(1,822)
$
(477,994)
$
(479,816)
(1) All amounts are shown net of noncontrolling interest.
P. 96 – THE NEW YORK TIMES COMPANY
The following table summarizes the reclassifications from AOCI for the period ended December 25, 2016:
(In thousands)
Detail about accumulated other comprehensive loss
components
Amounts reclassified
from accumulated
other comprehensive
loss
Affect line item in the statement
where net income is presented
Funded status of benefit plans:
Amortization of prior service credit(1)
Amortization of actuarial loss(1)
Pension settlement charge
Total reclassification, before tax(2)
Income tax expense
Total reclassification, net of tax
$
$
(10,385) Selling, general & administrative costs
36,563
Selling, general & administrative costs
21,294
Pension settlement charge
47,472
18,769
Income tax (benefit)/expense
28,703
(1) These accumulated other comprehensive income components are included in the computation of net periodic benefit cost for
pension and other retirement benefits. See Notes 9 and 10 for additional information.
(2) There were no reclassifications relating to noncontrolling interest for the year ended December 25, 2016.
17. Segment Information
We have one reportable segment that includes The New York Times, NYTimes.com and related businesses.
Therefore, all required segment information can be found in the Consolidated Financial Statements.
Our operating segment generated revenues principally from circulation and advertising. Other revenues
consist primarily of revenues from news services/syndication, digital archives, rental income, our NYT Live business,
e-commerce and affiliate referrals.
18. Commitments and Contingent Liabilities
Operating Leases
Operating lease commitments are primarily for office space and equipment. Certain office space leases provide
for rent adjustments relating to changes in real estate taxes and other operating costs.
Rental expense amounted to approximately $16 million in 2016, 2015 and 2014. The approximate minimum
rental commitments under noncancelable leases, net of subleases, as of December 25, 2016 were as follows:
(In thousands)
2017
2018
2019
2020
2021
Later years
Total minimum lease payments
Less: noncancelable subleases
Amount
$
11,362
5,969
3,487
3,091
2,903
4,113
30,925
(683)
Total minimum lease payments, net of noncancelable subleases
$
30,242
THE NEW YORK TIMES COMPANY – P. 97
Capital Leases
Future minimum lease payments for all capital leases, and the present value of the minimum lease payments as
of December 25, 2016, were as follows:
(In thousands)
2017
2018
2019
2020
2021
Later years
Total minimum lease payments
Less: imputed interest
$
Amount
552
552
7,245
—
—
—
8,349
(1,570)
Present value of net minimum lease payments including current maturities
$
6,779
Restricted Cash
We were required to maintain $24.9 million of restricted cash as of December 25, 2016 and $28.7 million as of
December 27, 2015, the majority of which is set aside to collateralize workers’ compensation obligations.
Newspaper and Mail Deliverers – Publishers’ Pension Fund
In September 2013, the Newspaper and Mail Deliverers-Publishers’ Pension Fund (the “NMDU Fund”)
assessed a partial withdrawal liability against the Company in the gross amount of approximately $26 million for the
plan years ending May 31, 2012 and 2013 (the “Initial Assessment”), an amount that was increased to a gross amount
of approximately $34 million in December 2014, when the NMDU Fund issued a revised partial withdrawal liability
assessment for the plan year ending May 31, 2013 (the “Revised Assessment”). The NMDU Fund claimed that when
City & Suburban Delivery Systems, Inc., a retail and newsstand distribution subsidiary of the Company and the
largest contributor to the NMDU Fund, ceased operations in 2009, it triggered a decline of more than 70% in
contribution base units in each of these two plan years.
The Company disagreed with both the NMDU Fund’s determination that a partial withdrawal occurred and
the methodology by which it calculated the withdrawal liability, and the parties engaged in arbitration proceedings to
resolve the matter. On June 14, 2016, the arbitrator issued an interim opinion and award that supported the NMDU
Fund’s determination that a partial withdrawal had occurred, including concluding that the methodology used to
calculate the Initial Assessment was correct. However, the arbitrator also concluded that the NMDU Fund’s
calculation of the Revised Assessment was incorrect. The Company expects to appeal the arbitrator’s decision
following the issuance of the final opinion and award.
Due to requirements of the Employee Retirement Income Security Act of 1974 that sponsors make payments
demanded by plans during arbitration and any resultant appeals, the Company had been making payments to the
NMDU Fund since September 2013 relating to the Initial Assessment and February 2015 relating to the Revised
Assessment based on the NMDU Fund’s demand. As a result, as of December 25, 2016, we have paid $11.7 million
relating to the Initial Assessment since the receipt of the initial demand letter. We also paid $5.0 million relating to the
Revised Assessment, which was refunded in July 2016 based on the arbitrator’s ruling. Amounts recognized as
expense were $10.7 million (including $6.7 million resulting from the interim decision (see Note 9 for more
information)), $6.8 million and $3.6 million for the fiscal years ended December 25, 2016, December 27, 2015 and
December 28, 2014, respectively.
As a result of the interim opinion and award relating to the Initial Assessment, the Company had a liability of
$9.7 million as of December 25, 2016. Management believes it is reasonably possible that the total loss in this matter
could exceed the liability established by a range of zero to approximately $10.0 million.
P. 98 – THE NEW YORK TIMES COMPANY
NEMG T&G, Inc.
The Company has been involved in class action litigation brought on behalf of individuals who, from 2006 to
2011, delivered newspapers at NEMG T&G, Inc., a subsidiary of the Company (“T&G”). T&G was a part of the New
England Media Group, which the Company sold in 2013. The plaintiffs asserted several claims against T&G,
including a challenge to their classification as independent contractors, and sought unspecified damages. In
December 2016, the Company reached a settlement with respect to the claims. This settlement remains subject to court
approval, and a final hearing is scheduled to take place in April 2017. As a result of the settlement, the Company
recorded a charge of $3.7 million in the fourth quarter within discontinued operations.
Other
We are involved in various legal actions incidental to our business that are now pending against us. These
actions are generally for amounts greatly in excess of the payments, if any, that may be required to be made. Although
the Company cannot predict the outcome of these matters, it is possible that an unfavorable outcome in one or more
matters could be material to the Company’s consolidated results of operations or cash flows for an individual
reporting period. However, based on currently available information, management does not believe that the ultimate
resolution of these matters, individually or in the aggregate, is likely to have a material effect on the Company’s
financial position.
THE NEW YORK TIMES COMPANY – P. 99
SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS
For the Three Years Ended December 25, 2016:
(In thousands)
Accounts receivable allowances:
Year ended December 25, 2016
Year ended December 27, 2015
Year ended December 28, 2014
Valuation allowance for deferred tax assets:
Year ended December 25, 2016
Year ended December 27, 2015
Year ended December 28, 2014
(1)
Includes write-offs, net of recoveries.
Balance at
beginning
of period
Additions
charged to
operating
costs and
other
Deductions(1)
Balance at
end of period
$
$
$
$
$
$
13,485
12,860
14,252
36,204
41,136
42,295
$
$
$
$
$
$
17,154
13,999
11,384
$
$
$
13,824
13,374
12,776
— $
36,204
— $
— $
4,932
1,159
$
$
$
$
$
$
16,815
13,485
12,860
—
36,204
41,136
P. 100 – THE NEW YORK TIMES COMPANY
QUARTERLY INFORMATION (UNAUDITED)
Quarterly financial information for each quarter in the years ended December 25, 2016 and December 27,
2015 is included in the following tables. See Note 13 of the Notes to the Consolidated Financial Statements for
additional information regarding discontinued operations.
(In thousands, except per share data)
Revenues
Operating costs
Restructuring charge(1)
Multiemployer pension plan withdrawal income(2)
Pension settlement charge(3)
Operating profit
(Loss)/income from joint ventures
Interest expense, net
(Loss)/income from continuing operations before
income taxes
Income tax (benefit)/expense
(Loss)/income from continuing operations
(Loss) from discontinued operations, net of income
taxes
Net income/(loss)
Net income/(loss) attributable to the noncontrolling
interest
Net (loss)/income attributable to The New York
Times Company common stockholders
Amounts attributable to The New York Times
Company common stockholders:
(Loss)/income from continuing operations
(Loss) from discontinued operations, net of
income taxes
Net (loss)/income
Average number of common shares outstanding:
Basic
Diluted
Basic earnings/(loss) per share attributable to The
New York Times Company common stockholders:
(Loss)/income from continuing operations
Loss from discontinued operations, net of
income taxes
Net (loss)/income
Diluted earnings/(loss) per share attributable to The
New York Times Company common stockholders:
(Loss)/income from continuing operations
Loss from discontinued operations, net of
income taxes
Net (loss)/income
Dividends declared per share
$
$
$
$
$
$
$
$
$
$
$
2016 Quarters
March 27,
2016
(13 weeks)
June 26,
2016
(13 weeks)
September 25,
2016
(13 weeks)
December 25,
2016
(13 weeks)
Full Year
(52 weeks)
$
379,515 $
372,630 $
363,547 $
439,650 $
1,555,342
351,580
—
—
—
27,935
(41,896)
8,826
(22,787)
(9,201)
(13,586)
—
(13,586)
5,315
339,933
11,855
11,701
—
9,141
(412)
9,097
(368)
124
(492)
—
(492)
281
356,596
362,801
1,410,910
2,949
(4,971)
—
8,973
463
9,032
404
121
283
—
283
123
—
—
21,294
55,555
5,572
7,850
53,277
13,377
39,900
(2,273)
37,627
14,804
6,730
21,294
101,604
(36,273)
34,805
30,526
4,421
26,105
(2,273)
23,832
(483)
5,236
(8,271) $
(211) $
406 $
37,144 $
29,068
(8,271) $
— $
(8,271) $
(211) $
— $
(211) $
406 $
39,417 $
31,341
— $
406 $
(2,273) $
37,144 $
(2,273)
29,068
161,003
161,003
161,128
161,128
161,185
162,945
161,235
162,862
161,128
162,817
(0.05) $
— $
(0.05) $
(0.05) $
— $
(0.05) $
0.04 $
— $
— $
— $
— $
— $
— $
— $
— $
— $
— $
— $
— $
— $
0.08 $
0.24 $
(0.01) $
0.23 $
0.24 $
(0.01) $
0.23 $
0.04 $
0.19
(0.01)
0.18
0.19
(0.01)
0.18
0.16
(1) We recorded restructuring charges in the second and third quarters associated with the streamlining of the Company’s international print
operations.
(2) We recorded a charge in the second quarter related to a partial withdrawal obligation under a multiemployer pension plan following an
unfavorable arbitration decision, of which $5 million was reimbursed to the Company in the third quarter.
(3) We recorded a pension settlement charge in the fourth quarter related to a lump-sum payment offer to certain former employees who
participated in a qualified pension plan.
THE NEW YORK TIMES COMPANY – P. 101
2015 Quarters
(In thousands, except per share data)
March 29, 2015
June 28,
2015
September 27,
2015
December 27,
2015
Full Year
Revenues
Operating costs
(13 weeks)
(13 weeks)
(13 weeks)
(13 weeks)
(52 weeks)
$
384,239 $
382,886 $
367,404 $
444,686 $
1,579,215
350,277
344,835
345,471
352,663
1,393,246
Multiemployer pension plan withdrawal expense(1)
Pension settlement charge(2)
4,697
40,329
—
—
—
—
4,358
—
9,055
40,329
Operating (loss)/profit
(11,064)
38,051
21,933
87,665
136,585
(Loss)/income from joint ventures
Interest expense, net
(Loss)/income from continuing operations before
income taxes
Income tax (benefit)/expense
Income/(loss) from continuing operations
Net (loss)/income
(572)
12,192
(23,828)
(9,407)
(14,421)
(14,421)
Net income attributable to the noncontrolling interest
159
(356)
9,776
27,919
11,700
16,219
16,219
181
170
9,127
12,976
3,611
9,365
9,365
50
(25)
7,955
79,685
28,006
51,679
51,679
14
(783)
39,050
96,752
33,910
62,842
62,842
404
Net (loss)/income attributable to The New York
Times Company common stockholders
Amounts attributable to The New York Times
Company common stockholders:
(Loss)/income from continuing operations
Net (loss)/income
Average number of common shares outstanding:
Basic
Diluted
Basic earnings/(loss) per share attributable to The
New York Times Company common stockholders:
(Loss)/income from continuing operations
Net (loss)/income
Diluted earnings/(loss) per share attributable to The
New York Times Company common stockholders:
Income/(loss) from continuing operations
Net (loss)/income
Dividends declared per share
$
$
$
$
$
$
$
$
(14,262) $
16,400 $
9,415 $
51,693 $
63,246
(14,262) $
16,400 $
9,415 $
51,693 $
(14,262) $
16,400 $
9,415 $
51,693 $
163,988
163,988
166,355
168,316
165,052
166,981
162,179
164,128
(0.09) $
(0.09) $
(0.09) $
(0.09) $
0.04 $
0.10 $
0.10 $
0.10 $
0.10 $
0.04 $
0.06 $
0.06 $
0.06 $
0.06 $
0.04 $
0.32 $
0.32 $
0.31 $
0.31 $
0.04 $
63,246
63,246
164,390
166,423
0.38
0.38
0.38
0.38
0.16
(1) We recorded charges related to partial withdrawal obligations under multiemployer pension plans in the first and fourth quarters.
(2) We recorded a pension settlement charge in the first quarter related to a lump-sum payment offer to certain former employees who
participated in a qualified pension plan.
Earnings/(loss) per share amounts for the quarters do not necessarily equal the respective year-end amounts
for earnings or loss per share due to the weighted-average number of shares outstanding used in the computations for
the respective periods. Earnings/(loss) per share amounts for the respective quarters and years have been computed
using the average number of common shares outstanding.
P. 102 – THE NEW YORK TIMES COMPANY
One of our largest sources of revenue is advertising. Our business has historically experienced higher
advertising volume in the fourth quarter than the remaining quarters because of holiday advertising.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
ITEM 9A. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Our management, with the participation of our principal executive officer and our principal financial officer,
evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of
the Securities Exchange Act of 1934) as of December 25, 2016. Based upon such evaluation, our principal executive
officer and principal financial officer concluded that our disclosure controls and procedures were effective to ensure
that the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and
forms, and is accumulated and communicated to our management, including our principal executive officer and
principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Management’s report on internal control over financial reporting and the attestation report of our independent
registered public accounting firm on our internal control over financial reporting are set forth in Item 8 of this Annual
Report on Form 10-K and are incorporated by reference herein.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There were no changes in our internal control over financial reporting during the quarter ended December 25,
2016, that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting.
ITEM 9B. OTHER INFORMATION
On February 16, 2017, the Compensation Committee of the Company’s Board of Directors approved a form of
Restricted Stock Unit Award Agreement (the “RSU Agreement”) to govern the terms of restricted stock units (“RSUs”)
granted to employees under the Company’s 2010 Incentive Compensation Plan, as amended (the “Plan”). Under the
terms of the RSU Agreement (and subject to the Plan), holders of RSUs will be entitled to receive one share of the
Company’s Class A Common Stock per RSU upon the vesting thereof provided the holder remains continuously
employed with the Company through the vesting date. RSUs vest in accordance with a vesting schedule specified at
the time of grant. The RSU Agreement provides for the acceleration of vesting upon the holder’s death or Disability
(as defined in the Plan), or upon the holder’s termination in certain circumstances within 12 months following a
Change in Control (as defined in the Plan). Holders of RSUs are entitled to payments equal to dividends paid on the
Company’s Class A Common Stock during the vesting period.
The foregoing summary of the RSU Agreement is incomplete and is qualified by reference to the form of RSU
Agreement filed as an exhibit to this Annual Report on Form 10-K.
THE NEW YORK TIMES COMPANY – P. 103
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
In addition to the information set forth under the caption “Executive Officers of the Registrant” in Part I of this
Annual Report on Form 10-K, the information required by this item is incorporated by reference to the sections titled
“Section 16(a) Beneficial Ownership Reporting Compliance,” “Proposal Number 1 – Election of Directors,” “Interests
of Related Persons in Certain Transactions of the Company,” “Board of Directors and Corporate Governance,”
beginning with the section titled “Independent Directors,” but only up to and including the section titled “Audit
Committee Financial Experts,” “Board Committees” and “Nominating & Governance Committee” of our Proxy
Statement for the 2017 Annual Meeting of Stockholders.
The Board of Directors has adopted a code of ethics that applies not only to the principal executive officer,
principal financial officer and principal accounting officer, as required by the SEC, but also to our Chairman. The
current version of such code of ethics can be found on the Corporate Governance section of our website at http://
investors.nytco.com/investors/corporate-governance. We intend to post any amendments to or waivers from the
code of ethics that apply to our principal executive officer, principal financial officer or principal accounting officer on
our website.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item is incorporated by reference to the sections titled “Compensation
Committee,” “Directors’ Compensation,” “Directors’ and Officers’ Liability Insurance” and “Compensation of
Executive Officers” of our Proxy Statement for the 2017 Annual Meeting of Stockholders.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
The information required by this item is incorporated by reference to the sections titled “Principal Holders of
Common Stock,” “Security Ownership of Management and Directors” and “The 1997 Trust” of our Proxy Statement
for the 2017 Annual Meeting of Stockholders.
P. 104 – THE NEW YORK TIMES COMPANY
Equity Compensation Plan Information
The following table presents information regarding our existing equity compensation plans as of December 25,
2016.
Number of securities
to be issued upon
exercise of outstanding
options, warrants
and rights
(a)
Weighted average
exercise price of
outstanding options,
warrants and rights
(b)
Number of securities
remaining
available for future
issuance under equity
compensation plans
(excluding securities
reflected in column (a))
(c)
Plan category
Equity compensation plans approved by security
holders
Stock options and stock-based awards
8,747,439 (1)
$
Employee Stock Purchase Plan
Total
Equity compensation plans not approved by security
holders
—
8,747,439
None
13.77 (2)
—
6,914,122 (3)
6,409,741 (4)
13,323,863
None
None
(1)
Includes (i) 4,517,832 shares of Class A stock to be issued upon the exercise of outstanding stock options granted under the 1991 Incentive
Plan, the 2010 Incentive Plan, and the 2004 Non-Employee Directors’ Stock Incentive Plan, at a weighted-average exercise price of $13.77
per share, and with a weighted-average remaining term of 3 years; (ii) 1,008,263 shares of Class A stock issuable upon the vesting of
outstanding stock-settled restricted stock units granted under the 2010 Incentive Plan; (iii) 62,348 shares of Class A stock related to vested
stock-settled restricted stock units granted under the 2010 Incentive Plan issuable to non-employee directors upon retirement from the Board;
and (iv) 3,158,996 shares of Class A stock that would be issuable at maximum performance pursuant to outstanding stock-settled
performance awards under the 2010 Incentive Plan. Under the terms of the performance awards, shares of Class A stock are to be issued at
the end of three-year performance cycles based on the Company’s achievement against specified performance targets. The shares included
in the table represent the maximum number of shares that would be issued under the outstanding performance awards; assuming target
performance, the number of shares that would be issued under the outstanding performance awards is 1,579,498.
(2) Excludes shares of Class A stock issuable upon vesting of stock-settled restricted stock units and shares issuable pursuant to stock-settled
performance awards.
(3)
Includes shares of Class A stock available for future stock options to be granted under the 2010 Incentive Plan. As of December 25, 2016, the
2010 Incentive Plan had 6,914,122 shares of Class A stock remaining available for issuance upon the grant, exercise or other settlement of
share-based awards. Stock options granted under the 2010 Incentive Plan must provide for an exercise price of 100% of the fair market value
(as defined in the 2010 Incentive Plan) on the date of grant. The 2004 Non-Employee Directors’ Stock Incentive Plan terminated on April 30,
2014.
(4)
Includes shares of Class A stock available for future issuance under the Company’s Employee Stock Purchase Plan (“ESPP”). We have not
had an offering under the ESPP since 2010.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
The information required by this item is incorporated by reference to the sections titled “Interests of Related
Persons in Certain Transactions of the Company,” “Board of Directors and Corporate Governance — Independent
Directors,” “Board of Directors and Corporate Governance — Board Committees” and “Board of Directors and
Corporate Governance — Policy on Transactions with Related Persons” of our Proxy Statement for the 2017 Annual
Meeting of Stockholders.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this item is incorporated by reference to the section titled “Proposal Number 4 —
Selection of Auditors,” beginning with the section titled “Audit Committee’s Pre-Approval Policies and Procedures,”
but only up to and not including the section titled “Recommendation and Vote Required” of our Proxy Statement for
the 2017 Annual Meeting of Stockholders.
THE NEW YORK TIMES COMPANY – P. 105
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(A) DOCUMENTS FILED AS PART OF THIS REPORT
(1) Financial Statements
As listed in the index to financial information in “Item 8 — Financial Statements and Supplementary Data.”
(2) Supplemental Schedules
The following additional consolidated financial information is filed as part of this Annual Report on Form 10-K
and should be read in conjunction with the Consolidated Financial Statements set forth in “Item 8 — Financial
Statements and Supplementary Data.” Schedules not included with this additional consolidated financial information
have been omitted either because they are not applicable or because the required information is shown in the
Consolidated Financial Statements.
Consolidated Schedule for the Three Years Ended December 25, 2016
II – Valuation and Qualifying Accounts
Page
100
Separate financial statements and supplemental schedules of associated companies accounted for by the equity
method are omitted in accordance with the provisions of Rule 3-09 of Regulation S-X.
(3) Exhibits
An exhibit index has been filed as part of this Annual Report on Form 10-K and is incorporated herein by
reference.
P. 106 – THE NEW YORK TIMES COMPANY
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: February 22, 2017
THE NEW YORK TIMES COMPANY
(Registrant)
BY: /s/ James M. Follo
James M. Follo
Executive Vice President and Chief Financial Officer
We, the undersigned directors and officers of The New York Times Company, hereby severally constitute Diane
Brayton and James M. Follo, and each of them singly, our true and lawful attorneys with full power to them and each
of them to sign for us, in our names in the capacities indicated below, any and all amendments to this Annual Report
on Form 10-K filed with the Securities and Exchange Commission.
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 dates indicated.
Signature
Title
/s/ Arthur Sulzberger, Jr.
Chairman and Director
/s/ Mark Thompson
/s/ James M. Follo
/s/ R. Anthony Benten
/s/ Raul E. Cesan
/s/ Robert E. Denham
/s/ Michael Golden
Chief Executive Officer, President and Director
(principal executive officer)
Executive Vice President and Chief Financial Officer
(principal financial officer)
Senior Vice President, Treasurer and Corporate Controller
(principal accounting officer)
Director
Director
Director
/s/ Steven B. Green
Director
/s/ Carolyn D. Greenspon Director
/s/ Joichi Ito
Director
/s/ Dara Khosrowshahi
/s/ James A. Kohlberg
/s/ Ellen R. Marram
/s/ Brian P. McAndrews
/s/ Doreen A. Toben
/s/ Rebecca Van Dyck
Director
Director
Director
Director
Director
Director
Date
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 21, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
February 22, 2017
THE NEW YORK TIMES COMPANY – P. 107
INDEX TO EXHIBITS
Exhibit numbers 10.16 through 10.28 are management contracts or compensatory plans or arrangements.
Exhibit
Number
(2.1)
(2.2)
(3.1)
(3.2)
(4)
(4.1)
(10.1)
(10.2)
(10.3)
(10.4)
(10.5)
(10.6)
(10.7)
(10.8)
(10.9)
(10.10)
(10.11)
(10.12)
(10.13)
Description of Exhibit
Asset Purchase Agreement, dated as of December 27, 2011, by and among NYT Holdings, Inc., The Houma
Courier Newspaper Corporation, Lakeland Ledger Publishing Corporation, The Spartanburg Herald-Journal,
Inc., Hendersonville Newspaper Corporation, The Dispatch Publishing Company, Inc., NYT Management
Services, Inc., The New York Times Company and Halifax Media Holdings LLC (filed as an Exhibit to the
Company’s Form 8-K dated December 27, 2011, and incorporated by reference herein).
Stock Purchase Agreement, dated as of August 26, 2012, between the Company and IAC/InterActiveCorp (filed
as an Exhibit to the Company’s Form 8-K dated August 29, 2012, and incorporated by reference herein).
Certificate of Incorporation as amended and restated to reflect amendments effective July 1, 2007 (filed as an Exhibit
to the Company’s Form 10-Q dated August 9, 2007, and incorporated by reference herein).
By-laws as amended through November 19, 2009 (filed as an Exhibit to the Company’s Form 8-K dated November
20, 2009, and incorporated by reference herein).
The Company agrees to furnish to the Commission upon request a copy of any instrument with respect to long-
term debt of the Company and any subsidiary for which consolidated or unconsolidated financial statements are
required to be filed, and for which the amount of securities authorized thereunder does not exceed 10% of the total
assets of the Company and its subsidiaries on a consolidated basis.
Securities Purchase Agreement, dated January 19, 2009, among the Company, Inmobiliaria Carso, S.A. de C.V. and
Banco Inbursa S.A., Institución de Banca Múltiple, Grupo Financiero Inbursa (including forms of notes, warrants
and registration rights agreement) (filed as an Exhibit to the Company’s Form 8-K dated January 21, 2009, and
incorporated by reference herein).
Agreement of Lease, dated as of December 15, 1993, between The City of New York, as landlord, and the Company,
as tenant (as successor to New York City Economic Development Corporation (the “EDC”), pursuant to an
Assignment and Assumption of Lease With Consent, made as of December 15, 1993, between the EDC, as Assignor,
to the Company, as Assignee) (filed as an Exhibit to the Company’s Form 10-K dated March 21, 1994, and
incorporated by reference herein).
Funding Agreement #4, dated as of December 15, 1993, between the EDC and the Company (filed as an Exhibit to
the Company’s Form 10-K dated March 21, 1994, and incorporated by reference herein).
New York City Public Utility Service Power Service Agreement, dated as of May 3, 1993, between The City of New
York, acting by and through its Public Utility Service, and The New York Times Newspaper Division of the Company
(filed as an Exhibit to the Company’s Form 10-K dated March 21, 1994, and incorporated by reference herein).
Letter Agreement, dated as of April 8, 2004, amending Agreement of Lease, between the 42nd St. Development
Project, Inc., as landlord, and The New York Times Building LLC, as tenant (filed as an Exhibit to the Company’s
Form 10-Q dated November 3, 2006, and incorporated by reference herein).
Agreement of Sublease, dated as of December 12, 2001, between The New York Times Building LLC, as landlord,
and NYT Real Estate Company LLC, as tenant (filed as an Exhibit to the Company’s Form 10-Q dated November
3, 2006, and incorporated by reference herein).
First Amendment to Agreement of Sublease, dated as of August 15, 2006, between 42nd St. Development Project,
Inc., as landlord, and NYT Real Estate Company LLC, as tenant (filed as an Exhibit to the Company’s Form 10-Q
dated November 3, 2006, and incorporated by reference herein).
Second Amendment to Agreement of Sublease, dated as of January 29, 2007, between 42nd St. Development Project,
Inc., as landlord, and NYT Real Estate Company LLC, as tenant (filed as an Exhibit to the Company’s Form 8-K
dated February 1, 2007, and incorporated by reference herein).
Third Amendment to Agreement of Sublease (NYT), dated as of March 6, 2009, between 42nd St. Development
Project, Inc., as landlord, and NYT Real Estate Company LLC, as tenant (filed as an Exhibit to the Company’s Form
8-K dated March 9, 2009, and incorporated by reference herein).
Fourth Amendment to Agreement of Sublease (NYT), dated as of March 6, 2009, between 42nd St. Development
Project, Inc., as landlord, and 620 Eighth NYT (NY) Limited Partnership, as tenant (filed as an Exhibit to the
Company’s Form 8-K dated March 9, 2009, and incorporated by reference herein).
Fifth Amendment to Agreement of Sublease (NYT), dated as of August 31, 2009, between 42nd St. Development
Project, Inc., as landlord, and 620 Eighth NYT (NY) Limited Partnership, as tenant (filed as an Exhibit to the
Company’s Form 10-Q dated November 4, 2009, and incorporated by reference herein).
Agreement of Sublease (NYT-2), dated as of March 6, 2009, between 42nd St. Development Project, Inc., as landlord,
and NYT Real Estate Company LLC, as tenant (filed as an Exhibit to the Company’s Form 8-K dated March 9, 2009,
and incorporated by reference herein).
First Amendment to Agreement of Sublease (NYT-2), dated as of March 6, 2009, between 42nd St. Development
Project, Inc., as landlord, and NYT Building Leasing Company LLC, as tenant (filed as an Exhibit to the Company’s
Form 8-K dated March 9, 2009, and incorporated by reference herein).
Agreement of Purchase and Sale, dated as of March 6, 2009, between NYT Real Estate Company LLC, as seller, and
620 Eighth NYT (NY) Limited Partnership, as buyer (filed as an Exhibit to the Company’s Form 8-K dated March
9, 2009, and incorporated by reference herein).
P. 108 – THE NEW YORK TIMES COMPANY
Exhibit
Number
(10.14)
(10.15)
(10.16)
(10.17)
(10.18)
(10.19)
(10.20)
(10.21)
(10.22)
(10.23)
(10.24)
(10.25)
(10.26)
(10.27)
(10.28)
(12)
(21)
(23.1)
(24)
(31.1)
(31.2)
(32.1)
(32.2)
(101.INS)
Description of Exhibit
Lease Agreement, dated as of March 6, 2009, between 620 Eighth NYT (NY) Limited Partnership, as landlord, and
NYT Real Estate Company LLC, as tenant (filed as an Exhibit to the Company’s Form 8-K dated March 9, 2009,
and incorporated by reference herein).
First Amendment to Lease Agreement, dated as of August 31, 2009, 620 Eighth NYT (NY) Limited Partnership, as
landlord, and NYT Real Estate Company LLC, as tenant (filed as an Exhibit to the Company’s Form 10-Q dated
November 4, 2009, and incorporated by reference herein).
The Company’s 2010 Incentive Compensation Plan, as amended and restated effective April 30, 2014 (filed as an
exhibit to the Company’s Form 8-K dated April 30, 2014, and incorporated by reference herein).
Form of Restricted Stock Unit Award Agreement under the Company’s 2010 Incentive Compensation Plan.
The Company’s 1991 Executive Stock Incentive Plan, as amended and restated through October 11, 2007 (filed as
an Exhibit to the Company’s Form 8-K dated October 12, 2007, and incorporated by reference herein).
The Company’s Supplemental Executive Retirement Plan, as amended and restated effective January 1, 2015 (filed
as an Exhibit to the Company’s Form 10-Q dated November 4, 2015, and incorporated by reference herein).
The Company’s Deferred Executive Compensation Plan, as amended and restated effective January 1, 2015 (filed
as an Exhibit to the Company’s Form 10-Q dated November 4, 2015, and incorporated by reference herein).
The Company’s 2004 Non-Employee Directors’ Stock Incentive Plan, effective April 13, 2004 (filed as an Exhibit to
the Company’s Form 10-Q dated May 5, 2004, and incorporated by reference herein).
The Company’s Non-Employee Directors Deferral Plan, as amended through October 11, 2007 (filed as an Exhibit
to the Company’s Form 8-K dated October 12, 2007, and incorporated by reference herein).
The Company’s Savings Restoration Plan, amended and restated effective February 19, 2015 (filed as an Exhibit to
the Company’s Form 10-Q filed November 4, 2015, and incorporated by reference herein).
The Company’s Supplemental Executive Savings Plan, amended and restated effective February 19, 2015 (filed as
an Exhibit to the Company’s Form 10-Q filed November 4, 2015, and incorporated by reference herein).
The New York Times Companies Supplemental Retirement and Investment Plan, amended and restated effective
January 1, 2015 (filed as an Exhibit to the Company’s Form 10-K filed February 24, 2016, and incorporated by
reference herein).
Amendment No. 1 to The New York Times Companies Supplemental Retirement and Investment Plan, amended
March 14, 2016, and effective January 1, 2016 (filed as an Exhibit to the Company’s Form 10-Q filed May 5, 2016,
and incorporated by reference herein).
Amendment No. 2 to The New York Times Companies Supplemental Retirement and Investment Plan, amended
November 11, 2016, and effective January 1, 2017.
Stock Appreciation Rights Agreement, dated as of September 17, 2009, between the Company and Arthur
Sulzberger, Jr. (filed as an Exhibit to the Company’s Form 8-K dated September 18, 2009, and incorporated by
reference herein).
Ratio of Earnings to Fixed Charges.
Subsidiaries of the Company.
Consent of Ernst & Young LLP.
Power of Attorney (included as part of signature page).
Rule 13a-14(a)/15d-14(a) Certification.
Rule 13a-14(a)/15d-14(a) Certification.
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
XBRL Instance Document.
(101.SCH)
XBRL Taxonomy Extension Schema Document.
(101.CAL)
XBRL Taxonomy Extension Calculation Linkbase Document.
(101.DEF)
XBRL Taxonomy Extension Definition Linkbase Document.
(101.LAB)
XBRL Taxonomy Extension Label Linkbase Document.
(101.PRE)
XBRL Taxonomy Extension Presentation Linkbase Document.
THE NEW YORK TIMES COMPANY – P. 109
EXHIBIT 12
The New York Times Company Ratio of Earnings to Fixed Charges (Unaudited)
(In thousands, except ratio)
Earnings from continuing operations
before fixed charges
Earnings from continuing operations before income
taxes, noncontrolling interest and income/(loss)
from joint ventures
$
Distributed earning from less than fifty-percent
owned affiliates
Adjusted pre-tax earnings from continuing
operations
Fixed charges less capitalized interest
Earnings from continuing operations before fixed
charges
Fixed charges
Interest expense, net of capitalized interest(1)
Capitalized interest
Portion of rentals representative of interest factor
Total fixed charges
$
$
$
For the Years Ended
December 25,
2016
December 27,
2015
December 28,
2014
December 29,
2013
December 30,
2012
66,799
$
97,535
$
38,218
$
98,014
$
255,621
—
—
3,914
1,400
9,251
66,799
47,663
97,535
50,719
42,132
62,869
99,414
63,032
264,872
67,243
114,462
$
148,254
$
105,001
$
162,446
$
332,115
43,825
$
46,391
$
58,914
$
59,588
$
63,218
559
3,838
338
4,328
152
3,955
—
3,444
17
4,025
48,222
$
51,057
$
63,021
$
63,032
$
67,260
Ratio of earnings to fixed charges
2.37
2.90
1.67
2.58
4.94
Note: The Ratio of Earnings to Fixed Charges should be read in conjunction with the Consolidated Financial Statements and Management’s
Discussion and Analysis of Financial Condition and Results of Operations in this Annual Report on Form 10-K for the fiscal year ended
December 25, 2016.
(1)
The Company’s policy is to classify interest expense recognized on uncertain tax positions as income tax expense. The Company has
excluded interest expense recognized on uncertain tax positions from the Ratio of Earnings to Fixed Charges.
EXHIBIT 21
Our Subsidiaries*
Name of Subsidiary
The New York Times Company
Fake Love LLC
Hello Society, LLC
London Bureau Limited
Madison Paper Industries (partnership) (40%)
New York Times Canada Ltd.
New York Times Digital LLC
Northern SC Paper Corporation (80%)
NYT Administradora de Bens e Servicos Ltda.
NYT Building Leasing Company LLC
NYT Capital, LLC
Donohue Malbaie Inc. (49%)
Midtown Insurance Company
NEMG T&G, Inc.
NYT Shared Service Center, Inc.
International Media Concepts, Inc.
The New York Times Distribution Corporation
The New York Times Sales Company
The New York Times Syndication Sales Corporation
NYT Group Services, LLC
NYT International LLC
New York Times Limited
New York Times (Zürich) GmbH
NYT B.V.
NYT France S.A.S.
International Herald Tribune U.S. Inc.
International Herald Tribune-Kathimerini Commercial S.A. (50%)
The Herald Tribune - Ha’aretz Partnership (50%)
NYT Germany GmbH
NYT Hong Kong Limited
Beijing Shixun Zhihua Consulting Co. LTD.
NYT Japan GK
NYT Singapore PTE. LTD.
NYT News Bureau (India) Private Limited
NYT Real Estate Company LLC
The New York Times Building LLC (58%)
Rome Bureau S.r.l.
Submarine Leisure Club, Inc.
The New York Times Company Pty Limited
Women in the World Media, LLC (30%)
* 100% owned unless otherwise indicated.
Jurisdiction of
Incorporation or
Organization
New York
Delaware
Delaware
United Kingdom
Maine
Canada
Delaware
Delaware
Brazil
New York
Delaware
Canada
New York
Massachusetts
Delaware
Delaware
Delaware
Massachusetts
Delaware
Delaware
Delaware
United Kingdom
Switzerland
Netherlands
France
New York
Greece
Israel
Germany
Hong Kong
People’s Republic of China
Japan
Singapore
India
New York
New York
Italy
Delaware
Australia
Delaware
EXHIBIT 23.1
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in Registration Statements No. 333-43369, No. 333-43371,
No. 333-37331, No. 333-09447, No. 33-31538, No. 33-43210, No. 33-43211, No. 33-50465, No. 33-50467, No. 33-56219,
No. 333-49722, No. 333-70280, No. 333-102041, No. 333-114767, No. 333-156475, No. 333-166426 and No. 333-195731 on
Form S-8, and Registration Statement No. 333-194161 on Form S-3 of The New York Times Company of our reports
dated February 22, 2017 with respect to the consolidated financial statements and schedule of The New York Times
Company and the effectiveness of internal control over financial reporting of The New York Times Company,
included in this Annual Report (Form 10-K) for the fiscal year ended December 25, 2016.
/s/ Ernst & Young LLP
New York, New York
February 22, 2017
EXHIBIT 31.1
Rule 13a-14(a)/15d-14(a) Certification
I, Mark Thompson, certify that:
1.
I have reviewed this Annual Report on Form 10-K of The New York Times Company;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
(c)
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 22, 2017
/s/ MARK THOMPSON
Mark Thompson
Chief Executive Officer
EXHIBIT 31.2
Rule 13a-14(a)/15d-14(a) Certification
I, James M. Follo, certify that:
1.
I have reviewed this Annual Report on Form 10-K of The New York Times Company;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
(c)
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 22, 2017
/s/ JAMES M. FOLLO
James M. Follo
Chief Financial Officer
EXHIBIT 32.1
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
In connection with the Annual Report on Form 10-K of The New York Times Company (the “Company”) for the
year ended December 25, 2016, as filed with the Securities and Exchange Commission on the date hereof (the
“Report”), I, Mark Thompson, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, based on my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results
of operations of the Company.
February 22, 2017
/s/ MARK THOMPSON
Mark Thompson
Chief Executive Officer
EXHIBIT 32.2
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
In connection with the Annual Report on Form 10-K of The New York Times Company (the “Company”) for the
year ended December 25, 2016, as filed with the Securities and Exchange Commission on the date hereof (the
“Report”), I, James M. Follo, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, based on my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results
of operations of the Company.
February 22, 2017
/s/ JAMES M. FOLLO
James M. Follo
Chief Financial Officer
Board of Directors
Raul E. Cesan
Founder and Managing
Partner
Commercial Worldwide LLC
Robert E. Denham
Partner
Munger, Tolles & Olson LLP
Michael Golden
Vice Chairman of the Board
The New York Times
Company
Steven B. Green
General Partner
Ordinance Capital L.P.
Carolyn D. Greenspon
Senior Consultant
Relative Solutions, LLC
Joichi Ito
Director, Media Lab
Massachusetts Institute
of Technology
Dara Khosrowshahi
President and C.E.O.
Expedia, Inc.
James A. Kohlberg
Co-Founder and Chairman
Kohlberg & Company
Ellen R. Marram
President
The Barnegat Group, LLC
Brian P. McAndrews
Former President, C.E.O.
and Chairman
Pandora Media, Inc.
Arthur Sulzberger Jr.
Chairman
The New York Times
Company
Publisher
The New York Times
Mark Thompson
President and C.E.O.
The New York Times
Company
Doreen A. Toben
Director of various
public corporations
Rebecca Van Dyck
Former Vice President, Consumer
and Brand Marketing
Facebook, Inc.
Shareholder Information Online
investors.nytco.com
Visit our website for Corporate Governance information about the
Company, including the Code of Ethics for our chairman, C.E.O. and
senior financial officers and our Business Ethics Policy.
Career Opportunities
Employment applicants should apply online at jobs.nytco.com. The
Company is committed to a policy of providing equal employment
opportunities without regard to race, color, religion, national origin,
ancestry, gender, age, marital status, sexual orientation, disability, military
or veteran status or any other characteristic covered by law.
Office of the Secretary
(212) 556-5995
Corporate Communications & Investor Relations
(212) 556-4317
Stock Listing
The Company’s Class A Common Stock is listed on the New York
Stock Exchange. Ticker symbol: NYT
Registrar & Transfer Agent
If you are a registered shareholder and have a question about your
account, or would like to report a change in your name or address,
please contact:
Computershare
P.O. Box 30170
College Station, TX 77842-3170
Overnight correspondence should be mailed to:
Computershare
211 Quality Circle, Suite 210
College Station, TX 77845
Shareholder Website
www.computershare.com/investor
Shareholder online inquiries
https://www-us.computershare.com/investor/contact
Domestic: (800) 240-0345; TDD Line: (800) 231-5469
Foreign: (201) 680-6578; TDD Line: (201) 680-6610
Annual Meeting
Wednesday, April 19, 2017, at 9 a.m.
The New York Times Building
620 Eighth Ave., 15th Floor
New York, NY 10018
Auditors
Ernst & Young LLP
5 Times Square
New York, NY 10036
Forward-Looking Statements
This Annual Report contains forward-looking statements that relate
to future events or our future financial performance. By their nature,
forward-looking statements are subject to risks and uncertainties that
could cause actual results to differ materially from those anticipated in any
such statements. You should bear this in mind as you consider forward-
looking statements. Factors that we think could, individually or in the
aggregate, cause our actual results to differ materially from expected and
historical results include those described in the “Risk Factors” section of
this Annual Report, as well as other risks detailed from time to time in
the Company’s publicly filed documents. The Company undertakes no
obligation to publicly update any forward-looking statement, whether as a
result of new information, future events or otherwise.
Copyright 2017
The New York Times Company
All rights reserved.
The New York Times Company
620 Eighth Avenue
New York, NY 10018
tel 212-556-1234