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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): March 4, 2003
EMMIS COMMUNICATIONS CORPORATION EMMIS OPERATING COMPANY
(Exact name of registrant as (Exact name of registrant as
specified in its charter) specified in its charter)
INDIANA INDIANA
(State of incorporation or (State of incorporation or
organization) organization)
0-23264 333-62172-13
(Commission file number) (Commission file number)
35-1542018 35-2141064
(I.R.S. Employer (I.R.S. Employer
Identification No.) Identification No.)
ONE EMMIS PLAZA ONE EMMIS PLAZA
40 MONUMENT CIRCLE 40 MONUMENT CIRCLE
SUITE 700 SUITE 700
INDIANAPOLIS, INDIANA 46204 INDIANAPOLIS, INDIANA 46204
(Address of principal executive offices)(Address of principal executive offices)
(317) 266-0100 (317) 266-0100
(Registrant's Telephone Number, (Registrant's Telephone Number,
Including Area Code) Including Area Code)
Item 5. Other Events.
On March 3, 2003, we issued the press releases attached to this report as
Exhibits 99.1 and 99.2. The text of those press releases is incorporated in this
Item by reference.
In addition, Jeffrey H. Smulyan, our Chairman and CEO, speaking at the Bear
Sterns 16th Annual Media, Entertainment and Information Conference, addressed
the following:
In the past, Emmis Communications has often discussed the separation of its
radio and TV businesses and the possible benefits such a move could create. We
considered the different scenarios that would make a separation feasible, and
said that we would be most interested in pursuing a split if we could do so in
conjunction with a significant radio or television acquisition.
During the past several months, we have also said that we were considering
executing a split on a stand-alone basis this summer, when the tax impact would
become more favorable. However, after careful study with our advisors,
management and board of directors, we have returned to our original plan of
waiting to separate our radio and TV operations until we can tie the separation
to a radio or TV acquisition that would make the split more feasible.
A number of factors entered into this decision:
o Significant and continued uncertainty in the capital markets due
to the prospect of war and other macro-economic drivers.
o An uncertain regulatory environment due to pending FCC
regulations, specifically those relating to radio and television
ownership limits.
o The compression and convergence of radio and television multiples
that would diminish the value created in a stand-alone
transaction.
o The possibility that the separation transaction could result in
two small-cap companies, thereby restricting the universe of
potential shareholders.
In addition, the company recognized that the cost of executing a split in this
environment would be considerable. The separation transaction itself could cost
tens of millions of dollars, but the company would also have to absorb the costs
inherent in operating two public companies -costs that are increasing rapidly in
our post-Sarbanes-Oxley world. Taking all of these factors into account, the
company decided it would be best to table the separation until a time that it
could be tied to a significant transaction.
This is not to say that Emmis will not separate its radio and TV businesses -
simply that current company, economic, regulatory and industry conditions do not
make the split feasible at this time. We will continue to look for strategic
transactions for both radio and television that could lead to the separation of
those businesses, and we will revisit the notion of a stand-alone separation if
we were to see stabilization in the capital markets and if we believed such a
move would benefit our shareholders; however, we are not actively pursuing such
a move at this time.
For the immediate future, Emmis intends to continue to focus on growing revenue,
managing costs and operating the stations and publications we own in the best
possible manner. With this focus, the company believes it can produce stronger
earnings and continue to reduce its debt and leverage.
In the past year, these efforts have been fruitful. We succeeded in deleveraging
our balance sheet. We demonstrated that we can operate TV successfully - the
stations we have acquired are more strategic and entrepreneurial than they were
before Emmis bought them. In radio, we showed that we can continue to produce in
the ratings books - and that we can make that success lead to real share growth
in a lot of our markets. Our New York cluster, which has been under considerable
scrutiny in the past year, has regained share and continues to build.
We are producing results by operating the way we always have: relying on the
passion of people who love media and are excellent at managing media.
We will continue to look for transactions in both radio and TV that will allow
us to grow, but we will pursue only those transactions that are strategic and
reasonable. And we will continue to carefully manage our balance sheet. We've
always said we're not going to pay prices that don't make sense, and we're not
going to look at assets unless we believe our management skills can create
significant shareholder value.
However, when we find an opportunity that we believe will benefit the company
and our shareholders - an opportunity like the one we found in Austin - we will
seize that opportunity.
Certain statements included above which are not statements of historical fact
and statements identified with the words "continue," "going," "will," "could" or
"would" are intended to be, and are, identified as "forward-looking statements,"
as defined in the Securities and Exchange Act of 1934, as amended, and involve
known and unknown risks, uncertainties and other factors that may cause the
actual results, performance or achievements of Emmis to be materially different
from any future result, performance or achievement expressed or implied by such
forward-looking statement. Such factors include, among others, general economic
and business conditions; fluctuations in the demand for advertising; increased
competition in the broadcasting industry including the implementation of
competing formats in large markets; changes in the costs of programming; changes
in interest rates; inability to close pending acquisitions or to grow through
suitable acquisitions, including the desired radio; future terrorist attacks or
other large-scale disasters; and other factors mentioned in documents filed by
Emmis with the Securities and Exchange Commission, including the current report
on Form 8-K/A, July 15, 2002. Emmis does not undertake any obligation to
publicly update or revise any forward-looking statements.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
EXHIBIT # DESCRIPTION
99.1 Press release dated March 3, 2003.
99.2 Press release dated March 3, 2003.
Signatures.
Pursuant to the requirements 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.
EMMIS COMMUNICATIONS CORPORATION
Date: March 3, 2003 By:
J. Scott Enright, Vice President,
Associate General Counsel and Secretary
EMMIS OPERATING COMPANY
Date: March 3, 2003 By:
J. Scott Enright, Vice President,
Associate General Counsel and Secretary