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P u b l i s h i n g G r o u p, L L C
INVESTOR PRESENTATION
February 2004
Forward looking statements
This presentation contains forward-looking statements as that term is used under the Private
Securities Litigation Act of 1995. These forward-looking statements are based on the current
assumptions, expectations and projections of the Company's management about future events.
Although we believe that these statements are based on reasonable assumptions, the Company
can give no assurance that they will prove to be correct. Numerous factors, including those
related to market conditions and those detailed in the confidential offering memorandum and
from time-to-time in the Company’s filings with the Securities and Exchange Commission, may
cause results of the Company to differ materially from those anticipated in these forwardlooking statements. Many of the factors that will determine the Company’s future results are
beyond the ability of the Company to control or predict. These forward-looking statements are
subject to risks and uncertainties and, therefore, actual results may differ materially. The
Company cautions you not to place undue reliance on these forward-looking statements. The
Company undertakes no obligation to revise or update any forward-looking statements, or to
make any other forward-looking statements, whether as a result of new information, future
events or otherwise. All references to “Company” and “MORRIS PUBLISHING GROUP, LLC” as
used throughout this presentation refer to MORRIS PUBLISHING GROUP, LLC and its
subsidiaries. All references to “Issuer” as used throughout this presentation refer to MORRIS
PUBLISHING GROUP, LLC
1
Definitions & sources of information
Earnings before net interest expense, including amortization of debt
issuance costs, provision for income taxes, depreciation and amortization
expense (“EBITDA”) is not a measure of performance defined in
accordance with accounting principles generally accepted in the United
States of America. However, we believe that EBITDA is useful to investors
in evaluating our performance because it is a commonly used financial
analysis tool for measuring and comparing media companies in areas of
operating performance. EBITDA should not be considered as an
alternative to net income as an indicator of our performance or as an
alternative to net cash provided by operating activities as a measure of
liquidity and may not be comparable to similarly titled measures used by
other companies.
Data on our market position and market share within our industry is
based, in part, on independent industry publications, government
publications, reports by market research firms or other published
independent sources, including Newspaper Association of America and
Audit Bureau of Circulation statistics.
2
Senior management team of
Morris Publishing Group, LLC
William S. Morris III
Chairman
Years of experience: 46
Carl N. Cannon
Executive Vice President
Years of experience: 38
Craig S. Mitchell
Senior Vice President
Finance & Treasurer &
Secretary
Years of experience: 9
William S. Morris IV
President & Chief
Executive Officer
Years of experience: 13
James C. Currow
Executive Vice President
Years of experience: 39
Steve K. Stone
Senior Vice President &
CFO
Years of experience: 24
3
Years of history and experience
2001
William S. Morris III serves as Chairman
of the Newspaper Association of America
2000
1996
Acquires Topeka, KS based
Stauffer Communications and
started online services
Morris Communications
Company is established
William S. Morris Jr., purchases
controlling interest in the newspaper
and fully acquires in 1955
Founding of the Augusta Gazette,
now The Augusta Chronicle
William S. Morris IV is named CEO
of Morris Publishing
1995
1983
William S. Morris IV is named
President of Morris Communications
Morris purchases The Florida
Times-Union
1970
1966
William S. Morris III becomes
publisher of the Augusta
newspapers
1945
1929
William S. Morris Jr., father of
today’s CEO, joins Augusta
Chronicle
1785
4
Summarized corporate structure
Morris
Communications
Company, LLC
Morris Publishing
Group, LLC,
a Georgia LLC
Morris Publishing
Finance Co.,
a Georgia Corp.
Other Subsidiaries
Operating
Subsidiaries
MCC Outdoor
Morris Book Publishing, LLC
MCC Magazines, LLC
MCC Radio, LLC
MStar Solutions, LLC
Best Read Guides
Franchise Company, LLC
MCC Events, LLC
Shivers Investments, LLC
Morris Air, LLC
9 months ending September 30, 2003:
% Operating revenues
77%
23%
% EBITDA
93%
7%
5
Investment considerations
 Strong management with an average of approximately 30 years of
publishing experience
 Relatively less cyclical publishing business
 Leading competitive position in all of our markets
 Complement print media with leading local websites
 Operating strategy focused on increasing readership & reducing costs
 Low leverage and strong cash flow generating model
Leading provider of local news, advertising and information
6
Geographically diverse, focused on local markets
26 daily newspapers
NE
Grand Island
SD
York
Yankton
Daily circulation>50,000
Daily circulation<50,000
Corporate headquarters
MN
Brainerd
Jacksonville
30%
Other
30%
MI
Hillsdale
Holland
TN
Oak Ridge
Lubbock
8%
Savannah
8%
Topeka
7%
Augusta
10%
Amarillo
7%
Total 2002 revenues = $433.4 million
KS
AK
Juneau Dodge City OK
Kenai
Newton
Ardmore
Pittsburgh
Topeka
Shawnee
TX
Amarillo
Lubbock
AR
Conway
MO
Hannibal
Independence/
Blue Springs
FL
Jacksonville
St. Augustine
Winter Haven
GA
Athens
Augusta
Savannah
‘02-’07
household
growth
Growth
U.S.
Morris’ top
six markets
6.0%
7.0%
Source: DemographicsNow
Morris also publishes 11 non-daily and 23 free community newspapers
7
Stability in revenue base
Morris Publishing 9mos’03 revenues
Year-over-Year revenue change
15%
Other
4%
Morris
Industry¹
10%
Circulation
17%
5%
0%
1998 1999 2000 2001 2002 9mos
2003
(5)%
Advertising
79%
(10)%
Total = $322.9 million
(15)%
1
Industry includes newspaper revenue of Gannett, Journal Register, Knight
Ridder, New York Times, McClatchy, Pulitzer
8
Relatively less cyclical advertising mix
9mos’03 Morris ad revenue segmentation
Category advertising spend
Retail
National
20
00
20%
19
98
Year-over-Year change
National
7%
Classified
15%
Classified
40%
10%
5%
Retail
53%
0%
(5)%
(10)%
(15)%
Source: Company
E
20
03
20
02
20
01
19
99
19
97
Total = $256 million
19
96
(20)%
Source: Newspaper Association of America; Wall Street research
9
Morris classifieds are more stable than peers
Classified revenue, Year-over-Year % change
20%
15%
10%
Gannett
Morris
E.W. Scripps
Journal Register
Tribune
Knight Ridder
5%
0%
(5)%
(10)%
(15)%
(20)%
1998
1999
2000
2001
2002
9mos 2003
Source: SEC filings and Company financials
10
Newspapers take the largest share of local
advertising . . .
U.S. local advertising market mix - 2003E
Radio
18%
Broadcast TV
15%
Yellow
Pages
14%
Cable TV
5%
Newspaper
43%
Outdoor
4%
Other
2%
Source: Wall Street research
$ 85 billion market ... $ 37 billion newspaper opportunity
11
. . . and deliver significant results for their
customers
Medium most used to check advertising prior to making a purchase
Newspapers
Direct Mail
TV
Yellow Pages
Internet
Radio
70%
60%
50%
40%
30%
20%
10%
0%
Discount
Department
Drug
Appliance
Home
Furnishings
Office Supply
Computers
Source: Scarborough Research
12
Competition from other local media
2002 market share by media
Newspaper
TV
Radio
$207
$62
45%
Jacksonville, FL
$51
$51
$42
$37
51%
55%
58%
45%
53%
Augusta, GA
Savannah, GA
Lubbock, TX
Amarillo, TX
Topeka, KS
Source: BEA, Company analysis
Newspaper is the primary media source
13
Leader in daily circulation
% share of daily circulation
Market
Morris %share
#2 %share
#3 - #4 %share
99%
1%
-
81%
17%
2%
Savannah, GA
97%
3%
0%
Topeka, KS
96%
3%
0%
Lubbock, TX
94%
6%
0%
Amarillo, TX
97%
3%
0%
Jacksonville, FL
Augusta, GA
1
1
Includes Aiken, SC
Source: Audit Bureau of Circulation, Most Recent Audit Reports, 2001 and 2002
14
Key daily newspapers
Amarillo
Augusta
Lubbock

Dominant media in an isolated market - 96.5% of daily newspaper circulation

Household income is expected to grow almost 40% faster than the national
average through 2007

Household growth is expected to exceed U.S. average by 29% through 2007

Limited daily newspaper competition

Among the highest profit margins of any newspaper in the Morris group

Household income expected to grow 37% faster than the U.S. average through
2007

Rapidly growing market with strong manufacturing and tourist sectors and nation’s
5th largest cargo port

Household growth in the MSA is projected to grow 19% faster through 2007

High advertising and newsroom color capacity through renovation of packaging
and distribution facility and new press

Stable and consistent cash flow performance with little to no print competition
Savannah
Topeka
Source: DemographicsNow SRC, LLC
Demographic data copyrighted 2002 by Experian/Applied Geographic Solutions
15
The Florida Times-Union
2002–2007 Household growth

Circulation of 166,812 daily and 228,865 on
Sundays

Population grew 21% between 1990 and 2000

Consistently generates one of the highest cash
flow margins in the company

A strong advertising market share among major
Morris newspapers

Penetration is 33% for Daily and 45% for
Sunday in the Jacksonville market

Average readership in the core market is 37%
for Daily and 56% for Sunday newspapers

Strong internet presence
9.1%
6.0%
U.S. average
Jacksonville,
FL
Source: DemographicsNow
Upside potential from Super Bowl 2005
16
Growing online focus and initiatives
2002 share of local advertising spending
Preferred medium to get local information
50%
Three portals
(MSN, AOL &
Yahoo)
TV & Radio
sites
3% 12%
40%
Online Yellow
pages
30%
24%
20%
40%
10%
21%
Co
m
m
un
ity
Newspaper sites
O
th
er
Online
verticals
ne
ws
pa
pe
Lo
r
ca
lT
V
M
st
aj
at
or
io
da
n
ily
ne
ws
pa
pe
r
Ra
di
o
st
at
io
O
n
nl
in
e
ci
ty
gu
id
e
0%
Source: Borell Associates Inc., 2003
Source: Technographics Research, March 27, 2003
Every Morris daily newspaper has a complementary website
17
Industry leading websites driving growth
NAA Digital Edge Awards1
Morris page impressions (millions)
481.3
Company
416.9
Morris Publishing
288.9
212.2
113.3
69.0
24.7
1997 1998 1999 2000 2001 2002 9mos
2003
Source: Company data
1
No. of
awards
16
Washington Post
9
Tribune
9
New York Times
7
E.W. Scripps
6
Knight Ridder
5
McClatchy
4
Belo
3
Gannett
1
Awards presented 1998-2002
Source: Newspaper Association of America
18
High editorial quality and targeted market focus
Readership
Niche publications
67%
53%
65%
ta
51%
gu
s
nv
ck
so
bb
65%
Au
55%
oc
k
56%
Lu
pe
ka
To
Sa
va
nn
ah
52%
70%
ille
70%
48%
Ja
72%
Daily
Am
ar
illo
Sunday
Source: Morris reader behavior study, October 2002
Editorial quality drives readership loyalty
Maximizing advertising market share
19
Key initiatives to further improve profitability
 Participating in Shared Service Center
 Simplifying, standardizing & centralizing most administrative
functions
 Leveraging purchase power
 Participation in a newsprint consortium
 Cost synergies by leveraging technologies
 Expect to fully implement by end of 2005, and save up to $10
million per year
 Creation of operating efficiencies
 Consolidation of printing and back office production activities by
producing our weekly newspapers, free distribution shoppers,
additional niche or regional publications using the facilities of daily
newspapers
20
FINANCIAL OVERVIEW
21
Historical revenue mix
($ millions)
Advertising
$429.5
$22.5
$77.7
$443.9
$25.1
$77.1
$455.4
$22.1
Circulation
Other
$437.5
$20.8
$433.4
$18.5
$74.8
$71.9
$76.5
$332.9
$319.0
$13.6
$329.3
$341.7
$356.8
$341.9
$343.0
1998
1999
2000
2001
2002
(3.9)%
(0.9)%
Year-over-year
change
3.4%
2.6%
$13.5
$53.9
$53.5
$251.4
$255.9
9mos 2002
9mos 2003
1.2%
22
Cost structure and profitability
Historical operating costs ($ millions)
Revenue
Labor and employee benefits
% of sales
Newsprint, ink and supplements
% of sales
Other operating costs
% of sales
Depreciation and amortization
EBITDA
EBITDA margin
1998
1999
2000
2001
2002
9mos
2002
9mos
2003
$429.5
$443.9
$455.4
$437.5
$433.4
$319.0
$322.9
142.4
153.4
161.2
163.1
162.5
118.8
127.4
33.2%
34.6%
35.4%
37.3%
37.5%
37.3%
39.4%
66.2
61.6
66.4
62.2
48.8
36.4
37.6
15.4%
13.9%
14.6%
14.2%
11.3%
11.4%
11.6%
106.4
108.4
113.0
106.2
110.1
77.3
82.6
24.8%
24.4%
24.8%
24.3%
25.4%
24.2%
25.6%
29.8
30.4
31.8
31.8
18.1
13.5
11.0
$114.2
$120.1
$114.2
$104.1
$111.7
$86.4
$75.1
26.6%
27.1%
25.1%
23.8%
25.8%
27.1%
23.3%
23
EBITDA comparison to peers
2000 EBITDA margins
Morris
25.1%
Average¹
24.6%
Liberty Publ
Hollinger Pub
MediaNews
1
2001 EBITDA margins
23.8%
16.8%
14.9%
Morris
23.8%
Liberty Publ
21.9%
Average¹
20.6%
MediaNews
Hollinger Pub
2002 EBITDA margins
15.1%
5.2%
Morris
25.8%
Liberty Publ
25.4%
Average¹
23.1%
MediaNews
23.1%
Hollinger Pub
11.1%
Average of Dow Jones, Lee Enterprises, Tribune, Journal Register, Knight Ridder, Media General, Hollinger, MediaNews, McClatchy, Liberty Group Publishing,
New York Times, RR Donnely
24
Near-term profitability
EBITDA margin
28-30%
25.8%
 Strategic investment in “Shared
Service Center”
 Duplicative work force during
transition phase
23.3%
 Cost synergies by leveraging
technologies
 Consolidation of printing, production
& back office activities
2002
9mos 2003
Target
25
Growing cash flows
Pre-tax free cash flow
Pre-tax free cash flow/EBITDA
$ millions
$58
$49
$57
$47
65%
63%
$41
52%
47%
36%
2000
2001
2002
9mos 2002 9mos 2003
2000
2001
2002
9mos 2002 9mos 2003
Note: Pre-tax free cash flow is defined as EBITDA less interest expense, less capex, less change in working capital
26
Summarized corporate structure
Morris
Communications
Company, LLC
Morris Publishing
Group, LLC,
a Georgia LLC
Morris Publishing
Finance Co.,
a Georgia Corp.
Other Subsidiaries
Operating
Subsidiaries
MCC Outdoor
Morris Book Publishing, LLC
MCC Magazines, LLC
MCC Radio, LLC
MStar Solutions, LLC
Best Read Guides
Franchise Company, LLC
MCC Events, LLC
Shivers Investments, LLC
Morris Air, LLC
9 months ending on Sept 30, 2003:
Revenues
$322.9
$94.2
% Revenues
77.4%
22.6%
EBITDA
$75.1
$5.4
% EBITDA
93.3%
6.7%
¹Shivers
Investments, LLC is an unrestricted subsidiary
27
Capital structure
($ millions)
As of September 30, 2003
Debt
Revolver (Sept ’10)
$19.0
Term loan (March ‘11)
225.0
Total credit facilities
New Senior subordinated notes
$244.0
300.0
Total debt
$544.0
Member’s deficit
(134.1)
Total capitalization
$409.9
Total debt/ LTM EBITDA
5.4x
LTM EBITDA/ Interest expense
4.2x
28
Leverage profile
Credit statistics
LTM debt/EBITDA
Total debt
$583
$566
5.1x
$545
5.4x
5.2x
5.0x
5.0x
4.6x
4.5x
4.7x
$544
$538
$522
$516
$513
1998
1999
2000
2001
2002
Mar'03
June'03
Sep'03
29