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                       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 FISCAL YEAR ENDED DECEMBER 31, 1999           COMMISSION FILE NUMBER 1-13492
                            ------------------------

                            THE TIMES MIRROR COMPANY
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S>                                            <C>
                  DELAWARE                                      95-4481525
       (STATE OR OTHER JURISDICTION OF                       (I.R.S. EMPLOYER
       INCORPORATION OR ORGANIZATION)                       IDENTIFICATION NO.)
             TIMES MIRROR SQUARE
           LOS ANGELES, CALIFORNIA                                 90053
  (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)                      (ZIP CODE)
</TABLE>

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (213) 237-3700
                            ------------------------

          SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

<TABLE>
<S>                                       <C>
TITLE OF EACH CLASS                       NAME OF EACH EXCHANGE ON WHICH REGISTERED
----------------------------------------  ---------------------------------------------------
Series A Common Stock                     New York Stock Exchange and Pacific Stock Exchange
Premium Equity Participating Securities   New York Stock Exchange
</TABLE>

                            ------------------------

          SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                             Series C Common Stock
                                (TITLE OF CLASS)

                            ------------------------

     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 [X]  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.  [ ]

     The aggregate market value of the voting stock of the Registrant held by
non-affiliates of the Registrant on March 13, 2000 was approximately $2.9
billion. (For purposes of this calculation, the market value of a share of
Series C Common Stock was assumed to be the same as a share of Series A Common
Stock, into which it is convertible.)

     Number of shares of Series A Common Stock outstanding at March 13, 2000:
40,471,127, excluding 18,237,864 shares held by subsidiaries of the Registrant;
4,001,067 common shares held by TMCT, LLC, representing 80% of the common shares
held by TMCT, LLC; 12,432,973 shares held by TMCT II, LLC, representing 80% of
the shares held by TMCT II, LLC; 16,230,026 shares held by Eagle New Media
Investments, LLC and 2,589,077 shares held as treasury shares.

     Number of shares of Series C Common Stock outstanding at March 13, 2000:
18,196,797.

                      DOCUMENTS INCORPORATED BY REFERENCE

     The information required by Part III will be incorporated by reference from
the Registrant's definitive Proxy Statement for the Company's 2000 Annual
Meeting of Shareholders to be filed by the Company within 120 days after the end
of the Company's fiscal year or will be filed under a Form 10-K/A.

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                                     PART I

ITEM 1. BUSINESS.

GENERAL

     The Times Mirror Company ("Times Mirror" or the "Company") is engaged
principally in the newspaper publishing, professional information and magazine
publishing businesses. The Company publishes the Los Angeles Times, Newsday, The
Baltimore Sun, The Hartford Courant, The Morning Call, The (Stamford) Advocate,
Greenwich Time and several smaller newspapers. The Company also provides
information to the aviation market and publishes magazines.

     During 1999, Times Mirror engaged in several strategic transactions
including the acquisition by an investment affiliate of Newport Media, Inc., a
publisher of shopper publications in the New York and New Jersey areas,
ValuMail, Inc., a shared mail company that distributes preprinted advertising in
Connecticut and Massachusetts, and Airspace Safety Analysis Corporation, a
provider of airspace utilization and Federal Aviation Administration compliance
services for the telecommunications and aviation industries. In addition, during
1999, the Company acquired New Mass. Media, Inc., a publisher of five weekly
alternative newspapers in Connecticut, Massachusetts and New York, and sold
Hollywood Online, Inc. and Apartment Search, Inc.

     In September 1999, Times Mirror, its affiliates and its largest
stockholders, the Chandler Trusts, completed a transaction that, for financial
reporting purposes, reduced Times Mirror's outstanding common stock by 12.4
million shares and reduced Times Mirror's then outstanding Series C Preferred
Stock by 501,000 shares. In September 1999, Times Mirror also decided to sell
AchieveGlobal, Inc., its professional training company, Allen Communication, a
division of AchieveGlobal that develops and markets interactive software and
training courseware, The StayWell Company, a health improvement company, and The
Sporting News, a national sports weekly. In February 2000, Gilat Communications
Ltd. acquired Allen Communication, Vulcan Ventures Inc. agreed to acquire The
Sporting News and MediMedia USA, Inc., a subsidiary of Havas MediMedia S.A.,
agreed to acquire The StayWell Company.

     In the fourth quarter of 1999, Times Mirror formed a new Internet unit,
Times Mirror interactive, focused on growing the Company's existing online
franchises and developing new businesses that leverage existing capabilities.
The Company continued to have an active share purchase program with a total of
3.2 million shares of Series A Common Stock acquired by the Company or its
affiliates during 1999, not including shares effectively retired in the
transaction with the Chandler Trusts. This more than offset the 2.0 million
shares of Series A Common Stock issued as a result of the exercise of stock
options.

     On March 13, 2000, Times Mirror and Tribune Company (Tribune) signed a
definitive agreement for the merger of the two companies in a cash and stock
transaction valued at approximately $8 billion based on the closing price of
Tribune common stock on March 10, 2000. Under the terms of this agreement,
Tribune will make a cash tender offer for up to 28 million shares of the
Company's common stock, which represents approximately 48% of the shares of
common stock outstanding as of March 13, 2000, at a price of $95 per share.
Following completion of the tender offer, Times Mirror and Tribune will merge in
a transaction in which each share of Times Mirror common stock is converted into
2.5 shares of Tribune common stock. In addition, if fewer than 28 million Times
Mirror common shares are purchased in the tender offer, Times Mirror
shareholders will be permitted to elect cash, at a price of $95 per share, in
the merger, up to the balance of the 28 million shares. The merger is subject to
the approval of the shareholders of both companies and other customary
conditions, including regulatory approvals. Times Mirror expects the tender
offer to be completed in mid-April and the merger to be completed in the second
or third quarter of 2000.

NEWSPAPER PUBLISHING SEGMENT

     Times Mirror publishes the Los Angeles Times, Newsday, The Baltimore Sun,
The Hartford Courant, The Morning Call, The (Stamford) Advocate, Greenwich Time
and several other daily and weekly newspapers. Local management operates each
daily newspaper substantially independently in order to most effectively meet
the needs of the area each newspaper serves. Editorial policies are also
established by local management. The Company continues to move toward
centralizing the back-office operations of its eastern
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newspapers and certain of its other business units. Each daily newspaper is a
member of Associated Press. The Los Angeles Times and Newsday also subscribe to
other supplementary news services. Production of Times Mirror's newspapers is
performed on presses owned by Times Mirror.

  LOS ANGELES TIMES

     The Los Angeles Times has been published continuously since 1881 and, in
1999, won a Pulitzer Prize for beat reporting. It is published every morning
and, for the six-month period ended September 30, 1999, as reported by the
Company to the Audit Bureau of Circulations, ranked as the largest metropolitan
newspaper in the United States in circulation. In 1999, its annual average
unaudited circulation was 1,106,749 for Monday through Friday, 1,000,140 for
Saturday and 1,381,422 for Sunday, compared with 1,097,079, 1,017,398 and
1,385,145, respectively, in 1998. Approximately 71%, 76% and 77% of the Monday
through Friday, Saturday and Sunday circulation, respectively, was
home-delivered in 1999, compared with 75%, 79% and 78% of the circulation,
respectively, in 1998.

     In 1999, the Los Angeles Times recorded full-run billed advertising volume
of 3,387,845 standard advertising unit inches (hereinafter "inches"), part-run
volume of 6,333,733 inches, and preprinted inserts of 1,156.0 million pieces,
compared with 3,212,104 inches, 5,362,693 inches and 1,169.3 million pieces,
respectively, in 1998. In addition, the Los Angeles Times derived revenue from
advertising supplements distributed to non-subscribers equivalent to 1,469.2
million pieces in 1999, compared with 1,138.5 million pieces in 1998.

     In addition to the daily edition covering the Los Angeles metropolitan
area, the Los Angeles Times publishes daily Orange County, San Fernando Valley
and Ventura County editions. The Los Angeles Times also publishes a daily
national edition that is distributed primarily in Northern California, New York
and Washington, D.C. In an effort to provide targeted local news coverage, the
Los Angeles Times inserts daily and semi-weekly community newspapers published
by Times Community Newspapers. In 1999, the Los Angeles Times also inserted 12
daily and weekly community news sections under the banner Our Times. In 1999,
the Los Angeles Times also established joint distribution agreements with La
Opinion, the largest Spanish-language daily newspaper in Southern California, in
which the Company owns a 50% equity interest, and other local native-language
newspapers. Through E Z Buy & E Z Sell Recycler Corporation, Times Mirror
publishes a collection of 19 alternative classified papers in Southern
California including titles such as the Recycler, AutoBuys, CycleBuys and the
Renter.

     In conjunction with the Washington Post, the Los Angeles Times operates a
supplementary news service sold to newspapers in the United States and foreign
countries. The Los Angeles Times also syndicates material to other newspapers
throughout the world.

     Net revenues for the Los Angeles Times, including California Community News
Corporation and E Z Buy & E Z Sell Recycler Corporation, were $1,205,665,000 in
1999, $1,137,521,000 in 1998 and $1,088,822,000 in 1997, representing 39.8%,
40.9%, and 41.2% of the Company's consolidated revenues from continuing
operations for such years.

  NEWSDAY

     Newsday, which is published seven days a week, circulates primarily in
Nassau and Suffolk counties on Long Island, New York and the borough of Queens
in New York City. In 1999, Newsday ranked as the sixth largest metropolitan
daily newspaper in the country for Monday through Friday circulation, and as the
eleventh largest for Sunday circulation. In 1999, Newsday's annual average
unaudited circulation was 568,697 for Monday through Friday, 450,451 for
Saturday, and 663,534 for Sunday, compared with 567,227, 459,732 and 658,351,
respectively, in 1998. Newsday also publishes Distinction, a bi-monthly magazine
designed to serve Long Island's upscale community, which is supported by
advertising revenues and paid subscriptions. In addition, Newsday's affiliated
alternate distribution company, DSA Community Publishing, operates This Week, a
free distribution shopper with 80 editions, Newport Media, a publisher of 135
pennysaver editions, and Hoy, a Spanish-language daily newspaper for the New
York metropolitan area. Newsday has won sixteen Pulitzer Prizes.
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     In 1999, Newsday recorded full-run billed advertising volume of 1,739,541
inches, part-run volume of 1,650,799 inches, and preprinted inserts of 863.3
million pieces, compared with 1,644,283 inches, 1,495,782 inches, and 796.5
million pieces, respectively, in 1998. In addition, Newsday, together with DSA
Community Publishing, derived revenue from advertising supplements distributed
to non-subscribers equivalent to 1,122.3 million pieces in 1999, compared with
1,197.2 million pieces in 1998.

  THE BALTIMORE SUN

     The Baltimore Sun primarily serves the Baltimore-Annapolis metropolitan
area, including Anne Arundel, Baltimore, Carroll, Harford and Howard counties.
The Baltimore Sun publishes a morning newspaper seven days a week. In 1999, The
Sun had an annual average unaudited circulation of 319,256 for Monday through
Saturday, compared with 320,138 for 1998. Annual average unaudited circulation
for Sunday was 479,090 in 1999 compared with 475,644 in 1998.

     In 1999, The Baltimore Sun newspapers recorded full-run billed advertising
volume of 2,001,999 inches, part-run volume of 505,163 inches, and preprinted
inserts of 667.0 million pieces, compared with 1,761,972 inches, 456,434 inches
and 671.9 million pieces, respectively, in 1998. In addition, The Baltimore Sun
newspapers derived revenues from advertising supplements delivered to
non-subscribers equivalent to 147.3 million pieces in 1999, compared with 110.9
million pieces in 1998.

     The Baltimore Sun also publishes a variety of weekly newspapers throughout
Anne Arundel, Baltimore, Carroll, Harford and Howard counties.

  THE HARTFORD COURANT

     The Hartford Courant, a morning daily and Sunday newspaper that was first
published in 1764, is the oldest continuously published newspaper in the United
States. It is published in Hartford, Connecticut, and serves the state's
northern and central regions. The Hartford Courant publishes 12 regional
editions on a daily basis, which provide local news and advertising. In 1999,
the annual average unaudited circulation was 210,084 for Monday through
Saturday, and 298,510 for Sunday, compared with 212,606 and 302,493,
respectively, in 1998.

     In 1999, The Hartford Courant recorded full-run billed advertising volume
of 1,423,862 inches, part-run volume of 591,946 inches, and preprinted inserts
of 456.4 million pieces, compared with 1,435,662 inches, 610,391 inches and
446.2 million pieces, respectively, in 1998. In addition, The Hartford Courant
derived revenues from advertising supplements distributed to non-subscribers
equivalent to 84.3 million pieces in 1999, compared with 80.5 million pieces in
1998.

     In 1999, The Hartford Courant won a Pulitzer Price for breaking news
reporting. In addition, in 1999, The Hartford Courant acquired New Mass. Media,
Inc., a publisher of five weekly alternative newspapers in Connecticut,
Massachusetts and New York, and an investment affiliate of the Company acquired
ValuMail, Inc., a shared mail company that distributes advertising supplements
to households in Connecticut, Massachusetts and Rhode Island.

  THE MORNING CALL

     The Morning Call in Allentown, Pennsylvania, is published daily and
primarily services Lehigh and Northampton counties in eastern Pennsylvania. In
1999, annual average unaudited circulation was 125,498 for Monday through
Friday, 140,114 for Saturday, and 171,030 for Sunday, compared with 127,561,
142,182 and 175,722, respectively, in 1998.

     In 1999, The Morning Call recorded full-run billed advertising volume of
1,291,892 inches, part-run volume of 379,782 inches, and preprinted inserts of
281.9 million pieces, compared with 1,410,190 inches, 254,436 inches and 264.2
million pieces, respectively, in 1998. In addition, The Morning Call derived
revenues from advertising supplements distributed to non-subscribers equivalent
to 21.8 million pieces in 1999, compared with 19.4 million pieces in 1998.

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  THE (STAMFORD) ADVOCATE AND GREENWICH TIME

     The (Stamford) Advocate and Greenwich Time are published every morning and
serve the southern part of Fairfield County, Connecticut. The Advocate
circulates primarily in Stamford, Connecticut and Greenwich Time circulates in
Greenwich, Connecticut. In 1999, The Advocate had an annual average unaudited
circulation of 28,002 for Monday through Saturday and 37,233 for Sunday,
compared with 28,003 and 38,604, respectively, in 1998. In 1999, Greenwich Time
had an annual average unaudited circulation of 12,416 for Monday through
Saturday and 13,866 for Sunday, compared with 12,625 and 14,071, respectively,
in 1998.

     In 1999, The Advocate recorded full-run billed advertising volume of
799,047 inches, and preprinted inserts of 41.8 million pieces, compared with
801,666 inches and 43.5 million pieces, respectively, in 1998. In 1999,
Greenwich Time recorded full-run billed advertising volume of 808,609 inches and
preprinted inserts of 13.9 million pieces, compared with 801,636 inches and 14.5
million pieces, respectively, in 1998. In addition, the newspapers derived
revenues from advertising supplements distributed to non-subscribers equivalent
to 22.0 million pieces in 1999, compared with 23.0 million pieces in 1998.

  ELECTRONIC PUBLISHING

     Times Mirror's newspapers offer numerous Web sites. The Los Angeles Times
operates the Web site latimes.com, a leading online news and advertising
service. Newsday (newsday.com), The Hartford Courant (ctnow.com), The Baltimore
Sun (sunspot.net) and The Morning Call (mcall.com) each maintain Web sites that
provide news and other information on a daily basis. The Advocate and Greenwich
Time maintain an arts and entertainment Web site, goodtogo.com. During 1999,
Times Mirror continued to support CareerPath.com, a national employment online
service with an extensive listing of jobs on the Internet, and Classified
Ventures, a company that seeks to use the Internet to expand the founding
companies' positions as leading suppliers of classified advertising. Classified
Ventures operates business units in the apartment (apartments.com), auto
(cars.com), new home (newhomenetwork.com) and resale real estate
(homehunter.com) categories. In addition to Times Mirror, the companies
participating in Classified Ventures include Central Newspapers, Inc., Gannett
Co., Inc., Knight-Ridder, Inc., The McClatchy Company, The New York Times
Company, Tribune Company and The Washington Post Company. The Los Angeles Times,
through Recycler, also provides extensive alternative classified listings on
recycler.com.

     In the fourth quarter of 1999, Times Mirror formed Times Mirror
interactive, a new business unit focused on growing and improving existing
online initiatives and building new Internet business.

  COMPETITION

     The Company's newspapers compete for advertising and readership with other
metropolitan, suburban and national newspapers as well as with other local and
national sales promotion media such as radio, broadcast television, cable
television, magazines, direct mail and the Internet. Competition for advertising
is based upon, among other factors, the number of, and the demographics of,
subscribers, readers or viewers, as the case may be, price, service and
advertiser results. Competition for circulation is based upon, among other
factors, the content of the medium, service and price.

     In its primary circulation areas of Los Angeles, Orange, Ventura, San
Bernardino and Riverside counties, the Los Angeles Times competes for
advertising and circulation with 17 local daily newspapers, with the largest
having approximately 360,000 total average daily circulation, and three daily
regional editions of national newspapers. In addition, there are also several
hundred weekly, semiweekly and free distribution newspapers in the distribution
area. Newsday competes with three major metropolitan newspapers and several
daily regional editions of national newspapers. In addition, there are numerous
daily, weekly, semiweekly local newspapers and free distribution newspapers in
its distribution area. The Baltimore Sun competes with the Washington Post in
Anne Arundel and Howard counties, with The Annapolis Capital in Anne Arundel
County and with The Carroll County Times in Carroll County, as well as with
daily regional editions of national newspapers. In addition, there are other
daily and weekly local newspapers in its distribution area. The Hartford Courant
competes with a number of daily newspapers, especially in metropolitan areas on
the periphery of its trade area, as well as daily regional editions of national
newspapers. In addition, there are other
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weekly and local daily newspapers in its distribution area. The Morning Call
competes with a few smaller daily and weekly newspapers, with its principal
competitor being the Express Times in Easton, Pennsylvania. Both The Advocate
and Greenwich Time compete with a number of larger daily newspapers which serve
the New York City metropolitan area and outlying regions.

     In their respective primary markets, the Company's newspapers generally
also compete for advertising and readership with hundreds of national magazines,
dozens of radio, broadcast and cable television stations, at least several local
magazines and numerous Internet content providers. The Company's newspapers
generally also compete for advertising with numerous direct mail distributors,
free-distribution shopping guides and outdoor billboard displays and Internet
advertising vehicles.

  RAW MATERIALS

     The primary raw material used by the newspapers is newsprint. Times Mirror
centrally purchases newsprint for all of its newspapers in order to achieve
advantageous terms from its vendors. Newsprint for all Times Mirror newspapers
is obtained from United States, Canadian and overseas sources unaffiliated with
Times Mirror. Times Mirror believes that it has adequate newsprint available
through its various suppliers and that it is not dependent on any one supplier.
Times Mirror's newsprint expense for 1999 decreased by 6.3% from 1998.

  REVENUES AND SEASONALITY

     The Company's newspaper revenues are derived primarily from advertising and
circulation. In 1999, the percentage of revenues attributable to advertising,
circulation and other items were 80.7%, 17.1% and 2.2%, respectively.
Advertising rates and revenues vary among the Company's newspapers depending on,
among other things, circulation, type of advertising, local market conditions,
time of publication and competition.

     Quarterly revenues of the Company's Newspaper Publishing segment vary
slightly due to industry seasonality, with first and third quarters' results
generally being minimally lower than those of the second and fourth quarters. In
1999, the quarterly revenues expressed as a percentage of total annual revenues
for the Company's Newspaper Publishing segment were 22.8% for the first quarter,
25.2% for the second quarter, 24.1% for the third quarter and 27.9% for the
fourth quarter.

PROFESSIONAL INFORMATION SEGMENT

     Times Mirror publishes aeronautical charts, flight information and related
information worldwide. In September 1999, Times Mirror decided to sell
AchieveGlobal, Allen Communication and StayWell. In February 2000, Gilat
Communications Ltd. acquired Allen Communication and MediMedia USA, Inc., a
subsidiary of Havas MediMedia S.A., agreed to acquire StayWell. The results of
AchieveGlobal, Allen Communication and StayWell are included in discontinued
operations for all periods presented.

  JEPPESEN

     Through Jeppesen Sanderson, Inc. and its European sister company, Jeppesen
& Co. GmbH, Times Mirror publishes aeronautical charts, flight information,
pilot training materials and other navigational and operational information
worldwide. Jeppesen DataPlan, Inc., a subsidiary of Jeppesen Sanderson, also
provides computerized flight plans, weather information and other flight
services. Jeppesen Sanderson offers a service called OnSight, a sophisticated
operations control workstation combining its flight planning, weather and flight
tracking display software. Jeppesen also delivers electronic aircraft
maintenance information to air carriers. The Jeppesen companies serve all U.S.
domestic airlines and the majority of airlines worldwide.

     During 1999, an investment affiliate of the Company acquired Airspace
Safety Analysis Corporation, a provider of airspace utilization and Federal
Aviation Administration compliance services for the telecommunications and
aviation industries.

     The Jeppesen companies compete with various airline consortiums and
governmental entities, as well as numerous vendors of training, maintenance,
weather and flight planning information.
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MAGAZINE PUBLISHING SEGMENT

     Times Mirror publishes a number of special interest and trade magazines
through its subsidiary, Times Mirror Magazines, Inc. The approximate six-month
average paid circulation figures per issue for the magazines for 1999 were
1,550,000 for Popular Science (a consumer-oriented magazine about science and
related issues); 1,750,000 for Field & Stream (a magazine about fishing and
outdoor recreation); 1,350,000 for Outdoor Life (a magazine about hunting and
outdoor recreation that is published 10 times a year); 200,000 for Outdoor
Explorer (a magazine about accessible outdoor activities that is published 3
times a year); 950,000 for Today's Homeowner (a magazine for homeowners about
all aspects of maintaining and improving a home that is published 10 times a
year); 1,400,000 for GOLF Magazine (a magazine for golf enthusiasts); 240,000
for Senior Golfer (a magazine for mature golf enthusiasts that is published 10
times a year); 425,000 for Ski Magazine (a magazine about skiing targeted at
families that is published 8 times a year); 400,000 for Skiing (a magazine about
skiing targeted at younger skiers that is published 7 times a year); 112,300 for
TransWorld SNOWboarding (a magazine about snowboarding targeted at the 15 to 18
year old market that is published 8 times a year); 112,000 for TransWorld
SKATEboarding (a magazine about skateboarding targeted at the 15 to 18 year old
market that is published 12 times a year with 2 special editions); 40,000 for
Warp (a magazine about skateboarding, snowboarding and music targeted at the 15
to 18 year old market that is published 6 times a year); 35,000 for Snap (a
magazine about competitive racing for bike motor-cross that is published 11
times a year); 48,000 for Ride BMX (a magazine about tricks and stunts for bike
motor-cross that is published 9 times a year); 25,000 for TransWorld SURF (a
youth oriented magazine about surfing aggressively that is published 7 times a
year); 65,000 for Snowboard Life (a magazine about snowboarding targeted at the
19 to 25 year old market that is published 6 times a year); 133,000 for Yachting
(a magazine about yachting and boating); and 150,000 for Salt Water Sportsman (a
magazine about salt-water fishing). Each of these magazines is published monthly
unless otherwise noted.

     In addition, Times Mirror Magazines publishes The Sporting News, a national
sports weekly that Times Mirror has agreed to sell to Vulcan Ventures Inc. The
approximate six-month average paid circulation figure per issue for The Sporting
News in 1999 was 540,000. Times Mirror Magazines also publishes Skiing Trade
News, TransWorld SNOWboarding Business, TransWorld SKATEboarding Business, BMX
Business News and Surf Business, controlled-circulation business magazines, and
other related publications. These magazines are primarily intended for
specialized markets.

     In addition to print media, Times Mirror magazines offers the following Web
sites that are affiliated with its titles: GOLFOnline; TSNOnline;
fieldandstream/outdoor life online; outdoor explorer online; todayshomeowner
online; saltwatersportsman online; yachtingnet; popsci.com; skinet; snowboarding
online; skateboarding online; transworldsurf.com and freeze online.

     The primary raw material used by Times Mirror Magazines is coated paper.
For 1999, the prices for the grades of papers used by the Company's magazines
decreased moderately. In 1999, Times Mirror Magazines centrally purchased coated
paper for all of its magazines to obtain more favorable terms and reduced
inventory levels due to the improved availability of coated paper. The Company
believes that it has adequate coated paper available through its various
suppliers and that it is not dependent on any one supplier.

     Times Mirror Magazines competes nationally with numerous special interest
and trade magazines and related Web sites. In addition to competing with similar
national media, Times Mirror Magazines must also compete for advertising
revenues with other local and national sales promotion media such as radio,
newspapers, broadcast television, direct mail and the Internet. Competition for
advertising is based upon, among other factors, the number of, and the
demographics of, subscribers, readers or viewers, as the case may be, price,
service and advertiser results. Competition for circulation is based upon, among
other factors, the content of the medium, service and price.

     As the Company's magazines are distributed nationally, they generally
compete with hundreds of radio stations, cable and broadcast television
stations, direct mailers and numerous competitors on the Internet. The Company's
magazines also compete with other magazines that contain similar content.
Popular Science competes with approximately 18 other magazine titles, Field &
Stream with approximately 18 titles, Outdoor Life and Outdoor Explorer with
approximately 8 titles, Today's Homeowner with approximately 15 titles,
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GOLF Magazine and Senior Golfer with approximately 6 titles, Ski Magazine and
Skiing with approximately 3 titles, TransWorld SNOWboarding, TransWorld
SKATEboarding, TransWorld SURF and Snowboard Life with approximately 19 titles,
Snap and Ride BMX with approximately 6 titles, Yachting with approximately 25
titles, Salt Water Sportsman with approximately 12 titles and The Sporting News
with approximately 12 titles.

     The Company's magazine operating revenues are derived primarily from
advertising and subscriptions. In 1999, the percentage of revenues attributable
to advertising, subscriptions and other items were 66.7%, 27.0% and 6.3%,
respectively. Advertising rates and revenues vary among the Company's magazines
depending on, among other things, circulation, type of advertising, time of
publication and competition.

INTELLECTUAL PROPERTY

     In recognition of the fact that intellectual property (e.g., trademarks,
copyrights, licenses and the like) is an important asset, the Company has
dedicated internal resources to protect its intellectual property and develop
these rights. The Company expects that these resources will support its ongoing
efforts to grow its businesses internally, especially in the realm of electronic
and online publishing activities.

EMPLOYEES

     At December 31, 1999, the Company and its consolidated affiliates had
20,229 employees, 14,726 of whom were full-time employees. Approximately 3,592
employees were represented by collective bargaining agents. The Company believes
that employee relations are good. Employees receive supplemental benefits
ranging from various forms of group insurance coverage to retirement income
programs.

ADDITIONAL INFORMATION

     Prior to February 1, 1995, the Company also engaged in the ownership and
operation of cable television systems, which business was divested by the merger
of the Company's corporate predecessor ("Old Times Mirror") with and into Cox
Communications, Inc. ("Cox"), resulting in the acquisition of Old Times Mirror's
cable business by Cox (the "Cox Merger"). The Company was incorporated in the
State of Delaware in June 1994 for the purpose of owning and operating Times
Mirror's publishing and information businesses after the Cox Merger was
completed on February 1, 1995. Old Times Mirror was incorporated in 1884 in the
State of California and was reincorporated in the State of Delaware in 1986. All
references to "Times Mirror" shall include the Company and the Company's
subsidiaries, collectively, unless the context suggests otherwise.

     See Selected Financial Data -- Five-Year Summary of Business Segment
Information and the Consolidated Financial Statements and notes thereto for
financial information about industry segments.

CERTAIN FACTORS AFFECTING FORWARD-LOOKING STATEMENTS

     Certain plans, objectives, projections and other information regarding
future performance and outcomes discussed in this Annual Report on Form 10-K are
forward-looking statements that are subject to risks and uncertainties. There
can be no assurances that these future results will be achieved. Readers are
cautioned that the achievement of such expectations, and other aspects of the
Company's performance, could be adversely affected by a number of factors,
including: (a) an increase in paper, printing and distribution costs over the
levels anticipated; (b) increased consolidation among major retailers or other
events depressing the level of display advertising; (c) an economic downturn in
the Company's principal newspaper markets or other occurrences leading to
decreased circulation and diminished revenues from both display and classified
advertising; (d) an increase in the use of alternate media such as the Internet
for classified and other advertising; (e) an increase in expenses related to new
initiatives and product improvement efforts in the flight information operating
unit; (f) unfavorable foreign currency fluctuations; (g) material changes in tax
liability due to unfavorable review by taxing authorities; and (h) a general
economic downturn resulting in decreased consumer and corporate spending on
discretionary items such as magazines or newspapers. It is not possible to
foresee or identify all such factors. The Company makes no commitment to update
any forward-looking

                                        7
<PAGE>   9

statement or to disclose any facts, events, or circumstances after the date
hereof that may affect the accuracy of any forward-looking statement.

ITEM 2. PROPERTIES.

     The general character, location, terms of occupancy and approximate size of
Times Mirror's principal plants and other materially important physical
properties at December 31, 1999 are listed below.

<TABLE>
<CAPTION>
                                                         APPROXIMATE AREA IN
                                                             SQUARE FEET
                                                      -------------------------
           GENERAL CHARACTER OF PROPERTY                OWNED      LEASED(1)(2)
           -----------------------------              ---------    ------------
<S>                                                   <C>          <C>
NEWSPAPER PUBLISHING
  Printing plants, business and editorial offices,
     garages and warehouse space located in:
     Los Angeles, California........................  1,714,724     2,150,761
     Hartford, Connecticut..........................    161,872       382,847
     Baltimore, Maryland............................     10,000     1,223,753
     Melville, New York.............................         --     1,071,107
     Other locations................................    458,189       109,794
PROFESSIONAL INFORMATION
  Business offices and warehouses in California,
     Colorado, New York and other locations.........    235,208       181,980
MAGAZINE PUBLISHING
  Business and editorial offices in Connecticut, New
     York, Missouri and other locations.............         --       220,393
CORPORATE
  Corporate offices and garages located in
     California and New York........................         --       500,880
</TABLE>

---------------
(1) Excludes 337,640 square feet of vacant land, 419,419 square feet of space
    sublet to unrelated third parties and 19,339 square feet of vacant space
    which is available for subleasing.

(2) The Company's material lease agreements expire at various dates through
    2011. In August 1997, the Company completed a transaction with its largest
    stockholders, the Chandler Trusts, pursuant to which, among other things,
    the Company contributed eight real properties with an aggregate market value
    of $225,850,000, constituting 3,030,000 square feet, to a limited liability
    company formed by the Company and the Chandler Trusts. The Company is
    leasing such properties from the limited liability company under a lease
    with an initial term of 12 years.

ITEM 3. LEGAL PROCEEDINGS.

     Times Mirror and its subsidiaries are defendants in actions for various
matters arising out of their business operations. In addition, from time to
time, Times Mirror and its subsidiaries are involved as parties in various
governmental and administrative proceedings. Times Mirror does not believe that
any such proceedings currently pending will have a material adverse effect on
its business or financial condition.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     No matters were submitted to a vote of security holders during the fourth
quarter of 1999.

                                        8
<PAGE>   10

EXECUTIVE AND KEY OFFICERS OF THE REGISTRANT

     The executive and key officers of the Company as of March 8, 2000 are
listed below. Executive and key officers are elected to serve until they resign
or are removed, or are otherwise disqualified to serve, or until their
successors are elected and qualified. Except as indicated below, all such
officers were employed by the Company and its predecessor company, Old Times
Mirror, for five years or more.

<TABLE>
<CAPTION>
                                                                                        OFFICER
         NAME            AGE           POSITIONS AND OFFICES WITH TIMES MIRROR          SINCE(1)
         ----            ---           ---------------------------------------          --------
<S>                      <C>   <C>                                                      <C>
Mark H. Willes.........   58   Chairman of the Board, President and Chief Executive       1995(2)
                               Officer
Horst A. Bergmann......   61   Executive Vice President, and Chairman, President and      1996(3)
                               Chief Executive Officer, Jeppesen Sanderson
Kathryn M. Downing.....   46   Executive Vice President, and Publisher, President and     1996(4)
                               Chief Executive Officer, Los Angeles Times
Raymond A. Jansen......   60   Executive Vice President, Eastern Newspapers, and          1996(5)
                               Publisher, President and Chief Executive Officer,
                               Newsday
Efrem Zimbalist III....   52   Executive Vice President and Chief Financial Officer,      1993(6)
                               Chairman and Chief Executive Officer, Times Mirror
                               Magazines and Chairman, AchieveGlobal
Roger H. Molvar........   44   Senior Vice President and Controller                       1996(7)
James R. Simpson.......   59   Senior Vice President, Human Resources                     1983(8)
Michael E. Waller......   58   Senior Vice President, and Publisher and Chief             1996(9)
                               Executive Officer, The Baltimore Sun
John S. Carroll........   58   Vice President, and Editor and Senior Vice President,      1998(10)
                               The Baltimore Sun
Janet Clayton..........   44   Vice President, and Editor of the Editorial Pages and      1998(11)
                               Vice President, Los Angeles Times
Jason E. Klein.........   39   Vice President, and President and Chief Operating          2000(12)
                               Officer, Times Mirror Magazines
Robert G. Magnuson.....   48   Vice President, and Senior Vice President, Regions, Los    1998(13)
                               Angeles Times
Anthony Marro..........   58   Vice President, and Editor and Executive Vice              1998(14)
                               President, Newsday
John C. McKeon.........   43   Vice President, and Senior Vice President of               1999(15)
                               Advertising, Los Angeles Times
Nancy W. O'Neill.......   40   Vice President, and President and Chief Executive          1999(16)
                               Officer, The StayWell Company
Michael Parks..........   56   Vice President, and Editor and Executive Vice              1998(17)
                               President, Los Angeles Times
Marty Petty............   47   Vice President, and Publisher and Chief Executive          1998(18)
                               Officer, The Hartford Courant
William J. Rowe........   64   Vice President, and Publisher and Chief Executive          1998(19)
                               Officer, The (Stamford) Advocate and Greenwich Time
Hilary A. Schneider....   38   Vice President, and President and Chief Executive          1999(20)
                               Officer, Times Mirror interactive
Edward L. Blood........   54   Vice President, Strategic Planning                         1997(21)
Rajender K. Chandhok...   50   Vice President and Treasurer                               1999(22)
Debra A. Gastler.......   47   Vice President, Taxes                                      1994(23)
Bonnie Guiton Hill.....   58   Vice President, and President and Chief Executive          1997(24)
                               Officer, The Times Mirror Foundation and Senior Vice
                               President, Community Relations, Los Angeles Times
Stephen C. Meier.......   49   Vice President, Public and Government Affairs, and         1989(25)
                               Corporate Secretary
William A. Niese.......   63   Vice President, General Counsel and Assistant Secretary    1990(26)
</TABLE>

                                        9
<PAGE>   11

---------------
 (1) The date indicated relates to the year in which such person first became an
     officer of Old Times Mirror unless the context suggests otherwise.

 (2) Mark H. Willes was elected as President and Chief Executive Officer of the
     Company effective June 1995 and Chairman of the Board effective January
     1996. From September 1997 to June 1999, he was Publisher of the Los Angeles
     Times. Prior to joining the Company, Mr. Willes was an executive of General
     Mills, Inc. from 1980 to 1995, serving as Vice Chairman upon his departure.

 (3) Horst A. Bergmann was elected as an executive officer of the Company
     effective May 1996. After joining Jeppesen Sanderson in 1963, he was named
     Flight Information Services Director in 1974 and Managing Director,
     Jeppesen & Co. GmbH in 1977. In 1987, he was appointed Chairman, President
     and Chief Executive Officer of Jeppesen Sanderson.

 (4) Kathryn M. Downing was elected as an executive officer of the Company
     effective May 1996. In March 1998, she was named President and Chief
     Executive Officer of the Los Angeles Times, and, in June 1999, she was
     named Publisher of the Los Angeles Times. She was named President and Chief
     Executive Officer of Matthew Bender in 1995. Prior to that time, Ms.
     Downing was President and Chief Executive Officer of Lawyers Cooperative
     Publishing, a division of Thomson Legal Publishing, beginning in 1993.

 (5) Raymond A. Jansen was elected as an officer of the Company effective May
     1996 and as an executive officer effective May 1999. He was named Executive
     Vice President, Eastern Newspapers, in 1999, and he was named Publisher,
     President and Chief Executive Officer of Newsday in November 1994. Prior to
     that time, he was Publisher and Chief Executive Officer of The Hartford
     Courant since 1990.

 (6) Efrem Zimbalist III was elected as an officer of Old Times Mirror effective
     March 1993 and as an executive officer effective May 1999. He became Chief
     Financial Officer of the Company in January 2000. From 1995 to 1999, he was
     President and Chief Executive Officer of Times Mirror Magazines. Mr.
     Zimbalist was Chairman and Chief Executive Officer of Correia Art Glass,
     Inc. from 1978 until he joined Old Times Mirror in July 1992.

 (7) Roger H. Molvar was elected as an executive officer of the Company
     effective May 1996. Prior to that time, he served as Senior Vice President
     and Comptroller of First Interstate Bank of California since 1989.

 (8) James R. Simpson was elected as an executive officer of the Company
     effective January 1995 and had served as an executive officer of Old Times
     Mirror prior to that time.

 (9) Michael E. Waller was elected as an officer of the Company effective May
     1996. Mr. Waller was named Publisher and Chief Executive Officer of The
     Baltimore Sun in May 1996. He previously served as Editor and Vice
     President of The Hartford Courant since 1990, joining the newspaper in 1986
     as Executive Editor and Vice President.

(10) John S. Carroll was elected as an officer of the Company effective July
     1998. He has been Editor and Senior Vice President of The Baltimore Sun
     since 1991.

(11) Janet Clayton was elected as an officer of the Company effective July 1998.
     She has been Editor of the Editorial Pages of the Los Angeles Times since
     1995 and a Vice President of the Los Angeles Times since 1997. From 1990 to
     1995, she was Assistant Editor, Editorial Pages, of the Los Angeles Times.

(12) Jason E. Klein was elected as an officer of the Company effective February
     2000. He has been President and Chief Operating Officer of Times Mirror
     Magazines since December 1999. From February 1999 to December 1999, he was
     Executive Vice President of Times Mirror Magazines and President of
     Corporate Sales, The Outdoor Company and Today's Homeowner. From 1995 until
     1999, he was Senior Vice President of Times Mirror Magazines.

(13) Robert G. Magnuson was elected as an officer of the Company effective July
     1998. He has been Senior Vice President, Regional Editions, of the Los
     Angeles Times since 1997. From 1990 to 1997, he was Vice President of the
     Los Angeles Times and President of the Orange County Edition of the Los
     Angeles Times.

                                       10
<PAGE>   12

(14) Anthony Marro was elected as an officer of the Company effective July 1998.
     He has been Editor of Newsday since 1987.

(15) John C. McKeon was elected as an officer of the Company effective February
     1999. He has been Senior Vice President of Advertising of the Los Angeles
     Times since November 1998. From 1994 to November 1998, he served as Senior
     Vice President of Advertising and Chief Innovation Officer at Newsday. From
     1992 to 1994, he was Vice President of Advertising at Newsday.

(16) Nancy W. O'Neill was elected as an officer of the Company effective
     February 1999. She has been President and Chief Executive Officer of The
     StayWell Company, the Company's health improvement unit, since February
     1998. From 1997 until February 1998, she was Vice President and General
     Manger of Mosby Consumer Health. From 1995 to 1997, she held a variety of
     positions at Times Mirror Magazines. From 1990 to 1994, she served as
     crisis manager at Argus Management Corporation.

(17) Michael Parks was elected as an officer of the Company in February 1998. He
     was named editor of the Los Angeles Times in October 1997. Prior to that
     time, he had been managing editor since 1996 after serving as deputy
     foreign editor and as a correspondent for the Los Angeles Times.

(18) Marty Petty was elected as an officer of the Company in February 1998. She
     was named Chief Executive Officer and Publisher, The Hartford Courant, in
     September 1997. She had previously served as Senior Vice President and
     General Manager of that paper since 1994. From 1992 to 1994, she was Vice
     President, Sales and Marketing of The Hartford Courant.

(19) William J. Rowe was elected as an officer of the Company effective July
     1998. He has been Publisher and Chief Executive Officer of The (Stamford)
     Advocate and Greenwich Time since 1986.

(20) Hilary A. Schneider was elected as an officer of the Company effective
     November 1999. From 1998 to 1999, she was general manager, The Baltimore
     Sun. Prior to that time, she served in several senior management positions
     at The Baltimore Sun directing a number of business activities, including
     sales, marketing, advertising and new business development.

(21) Edward L. Blood was elected as an executive officer of the Company in July
     1997. Prior to that time, he was Senior Vice President, Investor Relations
     and Strategic Planning at Darden Restaurants since 1995. Prior to that
     time, he had been Vice President, Strategic Planning and Analysis at
     General Mills.

(22) Rajender K. Chandhok was elected as an executive officer of the Company
     effective May 1999. From 1998 to May 1999, he was staff Vice President,
     Investments and Risk Management. From 1997 to 1998, he was Assistant
     Treasurer, Investments and Risk Management and from 1995 to 1997, he was
     Assistant Treasurer, Pension and Investments.

(23) Debra A. Gastler was elected as an executive officer of Old Times Mirror
     effective January 1994. Prior to that time, she had been Vice President,
     Taxes of Pacific Enterprises since 1990 and Director of Taxes of Pacific
     Enterprises since 1987.

(24) Bonnie Guiton Hill was elected as an officer of the Company effective
     January 1997. From 1992 to 1996, she served as dean and professor of
     commerce at the McIntyre School of Commerce at the University of Virginia.

(25) Stephen C. Meier was elected as an officer of the Company effective January
     1995 and served as an officer of Old Times Mirror prior to that time.

(26) William A. Niese was elected as an executive officer of the Company in July
     1997. Prior to August 1998, he had been Senior Vice President and General
     Counsel of the Los Angeles Times since 1990.

                                       11
<PAGE>   13

                                    PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     The Company's Series A Common Stock is traded principally on the New York
Stock Exchange ("NYSE") and is also listed on the Pacific Stock Exchange. Times
Mirror Series C Common Stock is not traded in an established public trading
market but is convertible into Times Mirror Series A Common Stock. At March 8,
2000, there were approximately 3,000 record holders of the Company's Series A
Common Stock and approximately 1,100 record holders of Series C Common Stock.
The price ranges for the Company's Series A Common Stock and the quarterly cash
dividends declared and paid on all Company Common Stock in 1999 and 1998 are
listed below.

<TABLE>
<CAPTION>
                                           STOCK PRICE          CASH DIVIDEND
                                          -------------        ----------------
                                          HIGH      LOW        DECLARED    PAID
                                          ----      ---        --------    ----
<S>                                       <C>       <C>        <C>         <C>
1999
  First Quarter.........................  $59 15/16 $53 5/16     $.20      $.20
  Second Quarter........................   63 5/16   53 3/8       .20       .20
  Third Quarter.........................   66 13/16  57 1/4       .20       .20
  Fourth Quarter........................   72 5/8    62 15/16     .20       .20
1998
  First Quarter.........................  $64 9/16  $56 15/16    $.18      $.18
  Second Quarter........................   65 13/16  58 1/16      .18       .18
  Third Quarter.........................   63 11/16  52 5/16      .18       .18
  Fourth Quarter........................   61 7/16   48 15/16     .18       .18
</TABLE>

     The payment of future dividends on common stock will depend on future
earnings, capital requirements, financial condition and other factors.

                                       12
<PAGE>   14

ITEM 6. SELECTED FINANCIAL DATA.

     The following selected financial data has been derived from the
consolidated financial statements that have been audited by Ernst & Young LLP,
independent auditors. The information set forth below is not necessarily
indicative of results of future operations, and should be read in conjunction
with "Management's Discussion and Analysis of Financial Condition and Results of
Operations" and the consolidated financial statements and related notes thereto
included elsewhere in this Annual Report on Form 10-K.

           SELECTED CONSOLIDATED FINANCIAL DATA AND OTHER INFORMATION

<TABLE>
<CAPTION>
      (IN THOUSANDS, EXCEPT PER SHARE,
         FINANCIAL RATIOS AND OTHER)              1999          1998          1997           1996           1995
      --------------------------------         -----------   -----------   -----------   ------------   ------------
<S>                                            <C>           <C>           <C>           <C>            <C>
OPERATING RESULTS
  Revenues...................................  $ 3,029,249   $ 2,783,988   $ 2,645,135   $  2,551,002   $  2,528,673
  Restructuring and one-time charges.........           --       155,681            --             --        412,778
  Operating profit (loss)....................      470,506       247,798       391,278        310,685       (268,208)
  Net interest income (expense)..............      (56,914)      (28,595)      (33,277)       (13,939)         6,473
  Income (loss) from continuing operations
    before income taxes......................      439,291       245,004       396,499        300,254       (253,421)
  Income (loss) from continuing operations...      259,062       134,059       234,655        182,258       (209,367)
  Net income(1)..............................      259,086     1,417,338       250,312        206,444      1,226,751
PER COMMON SHARE
  Basic earnings (loss) from continuing
    operations...............................  $      3.53   $      1.32   $      2.18   $       1.36   $      (2.61)
  Basic earnings.............................         3.53         16.46          2.35           1.59          10.02
  Diluted earnings (loss) from continuing
    operations(2)............................         3.38          1.29          2.12           1.32          (2.61)
  Diluted earnings...........................         3.38         16.06          2.29           1.54          10.02
  Dividends declared(3)......................          .80           .72           .55            .30            .24
  Dividends paid.............................          .80           .72           .55            .36            .45
FINANCIAL DATA
  Current assets(4)(5)(6)....................  $   713,558   $ 1,543,486   $   474,833   $    544,335   $    745,314
  Property, plant and equipment, net.........      966,095       903,483       920,995      1,080,642      1,085,341
  Total assets(5)(6).........................    3,897,371     4,157,929     3,171,828      3,179,395      3,444,641
  Long-term debt(6)..........................    1,562,240       941,423       925,404        459,007        247,062
  Shareholders' equity(6)....................      399,729     1,342,453       875,999      1,498,810      1,806,236
  Capital expenditures(7)....................      173,484       131,548       113,081         87,326         90,819
  Operating profit margin(8).................         15.5%         15.2%         15.5%          12.2%           7.5%
  Total debt as a % of adjusted
    capitalization(6)........................         82.0%         48.3%         54.9%          23.5%          12.1%
  Shareholders' equity per common share(9)...  $      4.98   $     13.45   $      5.90   $       9.54   $      11.64
OTHER
  Adjusted price range of common stock(10)...  $ 72 5/8 to   $65 13/16 to  $ 61 3/4 to   $      56 to   $  35 1/4 to
                                                   53 5/16      48 15/16        46 1/8         30 5/8         17 1/4
  Number of employees at end of year.........       20,229        20,619        21,567         20,803         21,877
  Weighted average shares:
    Basic....................................   68,252,398    84,813,581    92,571,618    102,113,298    113,797,192
    Diluted..................................   73,090,497    86,927,815    97,013,301    105,372,495    113,797,192
  Common shares outstanding at end
    of year(11)..............................   59,738,144    73,381,279    87,903,444     96,729,785    105,698,043
</TABLE>

                                       13
<PAGE>   15

---------------
This summary should be read in conjunction with the consolidated financial
statements and notes thereto.

 (1) Includes the following after-tax gains (charges) related to discontinued
     operations (in thousands):

<TABLE>
<CAPTION>
                                                            1998        1997        1996         1995
                                                         ----------    -------    --------    ----------
     <S>                                                 <C>           <C>        <C>         <C>
     Restructuring, one-time and other charges.........  $  (47,206)   $(7,842)   $(30,305)   $ (210,381)
     Net gain on disposal..............................   1,316,686         --      32,047     1,634,294
                                                         ----------    -------    --------    ----------
                                                         $1,269,480    $(7,842)   $  1,742    $1,423,913
                                                         ==========    =======    ========    ==========
</TABLE>

 (2) Includes the $.38 per share impact of the cash paid in excess of
     liquidation value on Series B preferred stock repurchases in 1995.

 (3) During 1996, the Company began declaring and paying common stock dividends
     in the same quarter; previously, dividends were declared in the quarter
     prior to payment. As a result, in the third quarter of 1996, no dividends
     were declared in order to change to the new procedure.

 (4) Excludes net assets of discontinued operations.

 (5) Includes proceeds from reorganization in 1998 as described in Notes 4 and 5
     to the consolidated financial statements.

 (6) Includes reduction of $635 million in cash and cash equivalents, $600
     million of debt issuance and an increase of $1 billion of treasury stock in
     connection with the 1999 recapitalization as described in Note 2 to the
     consolidated financial statements.

 (7) Excludes capital expenditures related to discontinued operations.

 (8) Excludes restructuring, one-time and other charges as follows (in
     thousands): 1998 -- $174,370; 1997 -- $18,000; 1995 -- $458,607.

 (9) Based on the common shares outstanding as described in (11) below.

(10) On February 1, 1995, Times Mirror common shareholders received
     distributions having a value of $10.45 per Times Mirror common share. The
     trading prices prior to February 1, 1995 have been adjusted to reflect
     these distributions.

(11) Excludes treasury shares of 52,387,120, 38,707,883 and 24,151,014 at
     December 31, 1999, 1998 and 1997, respectively.

                                       14
<PAGE>   16

               FIVE-YEAR SUMMARY OF BUSINESS SEGMENT INFORMATION

<TABLE>
<CAPTION>
       (IN THOUSANDS)             1999          1998          1997          1996          1995
       --------------          ----------    ----------    ----------    ----------    ----------
<S>                            <C>           <C>           <C>           <C>           <C>
REVENUES
  Newspaper Publishing.......  $2,514,325    $2,308,178    $2,179,244    $2,074,692    $2,057,596
  Professional Information...     235,356       211,929       195,339       185,207       170,849
  Magazine Publishing........     278,930       262,683       248,712       234,192       242,864
  Corporate and Other........         638         1,198        21,845        56,938        57,928
  Intersegment Revenues......          --            --            (5)          (27)         (564)
                               ----------    ----------    ----------    ----------    ----------
                               $3,029,249    $2,783,988    $2,645,135    $2,551,002    $2,528,673
                               ==========    ==========    ==========    ==========    ==========
OPERATING PROFIT (LOSS)(1)
  Newspaper Publishing.......  $  457,067    $  297,433    $  402,207    $  307,512    $ (109,483)
  Professional Information...      64,789        43,858        55,659        55,517        55,742
  Magazine Publishing........      19,184       (14,232)       18,309         8,753       (73,904)
  Corporate and Other........     (70,534)      (79,261)      (84,897)      (61,097)     (140,563)
                               ----------    ----------    ----------    ----------    ----------
                               $  470,506    $  247,798    $  391,278    $  310,685    $ (268,208)
                               ==========    ==========    ==========    ==========    ==========
IDENTIFIABLE ASSETS
  Newspaper Publishing.......  $2,290,708    $1,999,880    $1,792,286    $1,836,158    $1,840,058
  Professional Information...     125,670        96,765        87,354        85,866        77,524
  Magazine Publishing........     287,268       271,457       263,521       244,254       255,358
  Corporate and Other........   1,020,635     1,600,199       355,996       444,845       606,428
  Discontinued Operations....     173,090       189,628       672,671       568,272       665,273
                               ----------    ----------    ----------    ----------    ----------
                               $3,897,371    $4,157,929    $3,171,828    $3,179,395    $3,444,641
                               ==========    ==========    ==========    ==========    ==========
DEPRECIATION AND AMORTIZATION
  Newspaper Publishing.......  $  125,019    $  116,116    $  106,919    $  104,743    $  110,299
  Professional Information...       7,454         6,852         6,648         6,675         5,307
  Magazine Publishing........       8,667         7,740         7,040         6,050         8,112
  Corporate and Other........       3,815         4,467         3,457         2,990         2,824
                               ----------    ----------    ----------    ----------    ----------
                               $  144,955    $  135,175    $  124,064    $  120,458    $  126,542
                               ==========    ==========    ==========    ==========    ==========
CAPITAL EXPENDITURES
  Newspaper Publishing.......  $  151,807    $  107,479    $   78,760    $   63,698    $   63,014
  Professional Information...      12,437        15,825         9,535         7,790        10,568
  Magazine Publishing........       3,768         1,651         2,243        10,849         1,060
  Corporate and Other........       5,472         6,593        22,543         4,989        16,177
                               ----------    ----------    ----------    ----------    ----------
                               $  173,484    $  131,548    $  113,081    $   87,326    $   90,819
                               ==========    ==========    ==========    ==========    ==========
</TABLE>

---------------
(1) Includes restructuring, one-time and other charges as follows (in
    thousands):

<TABLE>
<CAPTION>
                                                1998          1997                        1995
                                             ----------    ----------                  ----------
    <S>                        <C>           <C>           <C>           <C>           <C>
    Newspaper Publishing.................    $  116,388    $   18,000                  $  316,216
    Professional Information.............        11,889            --                       1,913
    Magazine Publishing..................        29,072            --                      71,672
    Corporate and Other..................        17,021            --                      68,806
                                             ----------    ----------                  ----------
                                             $  174,370    $   18,000                  $  458,607
                                             ==========    ==========                  ==========
</TABLE>

     The pretax charges in 1998 are comprised of restructuring and one-time
     charges of $155,681 and other charges that did not qualify for accounting
     classification as restructuring charges of $18,689.

     The pretax charges in 1995 are comprised of restructuring and one-time
     charges of $412,778 and other charges that did not qualify for accounting
     classification as restructuring charges of $45,829.

                                       15
<PAGE>   17

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

OVERVIEW

     The Company's 1999 earnings per share from continuing operations increased
24.7% to $3.23 per share on a diluted basis from $2.59 per share in the prior
year, excluding a 1999 gain on the sale of Hollywood Online and 1998
restructuring, one-time and other charges. Including the gain on the sale and
the restructuring, one-time and other charges, earnings per share for 1999 and
1998 were $3.38 and $1.29 per share, respectively. Earnings per share for 1999
increased primarily as a result of the effective retirement of shares previously
held by the public and the Company's largest shareholders, the Chandler Trusts.
In addition, the Company's business segments each achieved double-digit gains in
operating profit for 1999 compared to the prior year, excluding the 1998
restructuring, one-time and other charges. Revenues rose 8.8% in 1999 compared
to 1998, including the effects of acquisitions, with revenue growth at each of
the Company's business segments.

     On March 13, 2000, Times Mirror and Tribune Company (Tribune) signed a
definitive agreement for the merger of the two companies in a cash and stock
transaction valued at approximately $8 billion based on the closing price of
Tribune common stock on March 10, 2000. Under the terms of this agreement,
Tribune will make a cash tender offer for up to 28 million shares of the
Company's common stock, which represents approximately 48% of the shares of
common stock outstanding as of March 13, 2000, at a price of $95 per share.
Following completion of the tender offer, Times Mirror and Tribune will merge in
a transaction in which each share of Times Mirror common stock is converted into
2.5 shares of Tribune common stock. In addition, if fewer than 28 million Times
Mirror common shares are purchased in the tender offer, Times Mirror
shareholders will be permitted to elect cash, at a price of $95 per share, in
the merger, up to the balance of the 28 million shares. The merger is subject to
the approval of the shareholders of both companies and other customary
conditions, including regulatory approvals. Times Mirror expects the tender
offer to be completed in mid-April and the merger to be completed in the second
or third quarter of 2000.

DISPOSITIONS

     In September 1999, Times Mirror announced its decision to sell
AchieveGlobal, Inc., a professional training company, Allen Communication, an
interactive software and training courseware developer, The StayWell Company, a
health improvement information company, and The Sporting News, a sports
magazine. The accompanying financial statements reflect AchieveGlobal, Allen
Communication and StayWell as discontinued operations for all periods presented.
The proposed sale of The Sporting News does not qualify for discontinued
operations treatment and continues to be reported in the Magazine Publishing
segment. While the Company previously expected to complete the sale of
AchieveGlobal in the first quarter of 2000, the Company now believes that
greater sales value can be realized by allowing AchieveGlobal to fully implement
certain of its strategic initiatives. Currently, the Company anticipates selling
AchieveGlobal by the end of 2000. In February 2000, the Company sold Allen
Communication to Gilat Communications Ltd. The Company also entered into
agreements in February 2000 to sell StayWell to a subsidiary of Havas MediMedia,
S.A., and to sell The Sporting News to Vulcan Ventures Inc. These dispositions
are expected to be completed in March 2000.

1999 RECAPITALIZATION

     In September 1999, the Company completed a recapitalization transaction
with its largest shareholders, the Chandler Trusts, in which the Company,
including certain of its affiliates, and the Chandler Trusts each contributed
assets worth $1.24 billion to TMCT II, LLC, a newly formed limited liability
company. The 1999 recapitalization resulted in a net effective reduction, for
financial reporting purposes, in the number of shares of the Series A and C
common stocks by 12.4 million shares and in the Company's Series C-1 and C-2
preferred stocks by 501,000 shares. Also, in connection with this
recapitalization, the Company replaced the Series C-1 and C-2 preferred stocks
with new Series D-1 and D-2 preferred stocks effective January 1, 2000. The
Series D-1 and D-2 preferred stocks are identical to the Series C-1 and C-2
preferred stocks except that the increases in the dividend rate on the Series
D-1 and D-2 preferred stocks are pursuant to a fixed and
                                       16
<PAGE>   18

certain schedule. As a result of the effective reduction of preferred stocks and
the replacement of the preferred stocks, preferred stock dividends will be
reduced to $8.1 million annually beginning in 2000. In connection with the
recapitalization, the Company issued $200.0 million of 6.65% two-year notes due
October 15, 2001 and $400.0 million of 7.45% ten-year notes due October 15, 2009
(see Note 2 to the consolidated financial statements for further information on
the 1999 recapitalization).

CONSOLIDATED RESULTS OF OPERATIONS

     The following table summarizes the Company's financial results (in
millions, except share and per share amounts):

<TABLE>
<CAPTION>
                                                         1999        1998        1997
                                                       --------    --------    --------
<S>                                                    <C>         <C>         <C>
Revenues.............................................  $3,029.2    $2,784.0    $2,645.1
Restructuring and one-time charges...................        --       155.7          --
Operating profit.....................................     470.5       247.8       391.3
Interest expense, net................................     (56.9)      (28.6)      (33.3)
Other, net...........................................      25.7        25.8        38.5
Income from continuing operations....................     259.1       134.1       234.7
Discontinued operations:
  Income (loss) from operations, net of taxes........        --       (33.4)       15.7
  Net gain on disposal, net of taxes.................        --     1,316.7          --
Net income...........................................     259.1     1,417.3       250.3
Preferred stock dividends............................      18.1        21.7        32.5
Earnings applicable to common shareholders...........     241.0     1,395.6       217.8
Basic earnings per share:
  Continuing operations..............................  $   3.53    $   1.32    $   2.18
  Discontinued operations............................        --       15.14         .17
                                                       --------    --------    --------
Basic earnings per share.............................  $   3.53    $  16.46    $   2.35
                                                       ========    ========    ========
Diluted earnings per share:
  Continuing operations..............................  $   3.38    $   1.29    $   2.12
  Discontinued operations............................        --       14.77         .17
                                                       --------    --------    --------
Diluted earnings per share...........................  $   3.38    $  16.06    $   2.29
                                                       ========    ========    ========
Weighted average shares (in thousands):
  Basic..............................................    68,252      84,814      92,572
                                                       ========    ========    ========
  Diluted............................................    73,090      86,928      97,013
                                                       ========    ========    ========
</TABLE>

1999 RESULTS

     Revenues for 1999 rose 8.8% compared to 1998 due to higher revenues at all
of the Company's business segments, including the effects of acquisitions (see
further discussion of segment results under the caption "Analysis by Segment").

     Operating profit for 1999 increased 11.4% compared to the prior year,
excluding 1998 restructuring, one-time and other charges, due to improvements at
each of the Company's business segments (see further discussion of segment
results under the caption "Analysis by Segment"). Pretax restructuring, one-time
and other charges in 1998 were $174.4 million, or $112.4 million after
applicable taxes. Operating profit for 1999 was impacted by lower pension
income, primarily in the Newspaper Publishing segment, due to a $16.8 million
reduction in the amortization of the unrecognized pension asset that existed
upon the 1986 adoption of the Statement of Financial Accounting Standards No.
87, "Employers' Accounting for Pensions."

     Income from continuing operations for 1999 was $248.4 million, or $3.23 per
share, compared to $246.5 million, or $2.59 per share, in the prior year,
excluding a 1999 pretax gain on the sale of Hollywood

                                       17
<PAGE>   19

Online, Inc. of $17.2 million ($10.7 million after applicable taxes), or $.15
per share, and the 1998 restructuring, one-time and other charges.

     Net interest expense for 1999 increased compared to the prior year due
primarily to higher debt levels resulting from the 1999 recapitalization (see
Note 2).

     Earnings per share from continuing operations increased in 1999 compared to
1998 due to a reduction in the weighted average number of shares as well as
lower preferred stock dividends resulting from the 1999 recapitalization, and an
increase in operating profit, which was partially offset by the impact of higher
net interest expense.

1998 RESULTS

     Revenues in 1998 increased 5.2% over the prior year due to higher revenues
at each of the Company's business segments (see further discussion of segment
results under the caption "Analysis by Segment"). The rate of growth slowed in
the second half, reflecting some weakening in certain markets and advertising
categories.

     Operating profit totaled $422.2 million in 1998 compared to $409.3 million
in 1997, excluding restructuring, one-time and other charges in both years. The
increase in 1998 operating profit was due primarily to reduced expense levels in
Corporate and Other, which was partially offset by decreases in operating profit
in the Newspaper and Magazine Publishing segments (see further discussion of
segment results under the caption "Analysis by Segment"). Including
restructuring, one-time and other charges, operating profit decreased to $247.8
million in 1998.

     Net interest expense declined in 1998 due to an increase in interest income
resulting from investment activity of the affiliated limited liability companies
created as a result of the divestitures of the Company's legal and medical
publishing operations. Higher interest income more than offset a rise in
interest expense due primarily to increased debt levels attributable to common
stock purchases, a recapitalization in 1997 (see Note 3) and acquisitions.

     Earnings per share for 1998 benefited principally from the gains on
divestitures, as well as a reduction in the average number of common shares and
lower preferred stock dividends. Preferred stock dividends in 1998 declined due
to the 1997 recapitalization and the Company's redemption of its Series B
preferred stock.

ANALYSIS BY SEGMENT

     The following sections discuss the segment results of the Company's
principal lines of business, excluding restructuring, one-time and other charges
of $174.4 million and $18.0 million for 1998 and 1997, respectively, unless
specifically stated otherwise.

NEWSPAPER PUBLISHING

     Newspaper Publishing revenues and operating profit were as follows (dollars
in millions):

<TABLE>
<CAPTION>
                                      1999      CHANGE      1998      CHANGE      1997
                                    --------    ------    --------    ------    --------
<S>                                 <C>         <C>       <C>         <C>       <C>
Revenues:
  Advertising.....................  $2,029.0     11.4%    $1,821.8      7.7%    $1,691.6
  Circulation.....................     430.3     (1.3)       435.9       --        435.8
  Other...........................      55.0      9.0         50.5     (2.7)        51.8
                                    --------              --------              --------
                                    $2,514.3      8.9%    $2,308.2      5.9%    $2,179.2
                                    ========              ========              ========
Operating profit..................  $  457.1     53.7%    $  297.4    (26.0)%   $  402.2
                                    ========              ========              ========
Operating profit excluding
  restructuring, one-time and
  other charges...................  $  457.1     10.5%    $  413.8     (1.5)%   $  420.2
                                    ========              ========              ========
</TABLE>

                                       18
<PAGE>   20

1999 Results

     Newspaper Publishing revenues rose in 1999 compared to the prior year,
including the addition of Newport Media, Inc., which was acquired in February
1999, and Recycler, acquired in April 1998. Excluding the impact of these
acquisitions, 1999 revenues rose 5.7%, with the Los Angeles Times up 4.7% and
the Eastern newspapers up 6.6% compared to 1998. Advertising revenue gains were
achieved at each of the Company's newspapers in 1999 due primarily to strong
gains in national advertising. Excluding the impact of acquisitions, advertising
revenues for 1999 rose 7.4%, with The Times up 6.6% and the Eastern newspapers
up 8.3% compared to 1998.

     Circulation revenues declined slightly as marketing strategies, largely at
The Times, involving pricing and promotional discounts to stimulate circulation
volume resulted in lower overall circulation revenues. Excluding the impact of
acquisitions, 1999 circulation revenues for the Newspaper Publishing segment
declined 1.9% compared to 1998.

     Segment operating profit for 1999 increased largely due to strong gains in
national advertising and declines in newsprint expense. The 1999 improvement in
operating profit was aided by a reduction in newsprint expense of 6.3% on a 7.2%
decline in average newsprint prices. Newsprint expense was only partially
affected by newsprint price declines due to the Company's use of newsprint
hedging contracts (see further information under the caption "Liquidity and
Capital Resources -- Market Risk"). Excluding newsprint and the impact of
acquisitions, other expenses rose 7.6% in 1999 compared to 1998, due primarily
to continuing circulation growth initiatives.

1998 Results

     In 1998, the Eastern Newspapers, including Newsday and The Baltimore Sun,
achieved outstanding performance, but the Newspaper Publishing segment's
operating profit overall was reduced by sluggish advertising revenues and higher
expense levels at The Times related largely to ongoing growth initiatives.
Accordingly, the Newspaper Publishing's operating profit margin decreased to
17.9% in 1998 from 19.3% in 1997.

     Newspaper Publishing revenues rose in 1998 due primarily to classified
advertising revenue growth at the Eastern Newspapers as well as incremental
revenues from acquisitions. Excluding the acquisitions of Recycler, Patuxent
Publishing Company acquired in September 1997 and This Week acquired in October
1997, advertising revenues rose 4.4%. Circulation revenues for 1998 were
essentially even compared to 1997 as marketing strategies involving pricing and
promotional discounts resulted in circulation volume gains but reduced
circulation revenues.

     For 1998, newsprint expense rose 15.1%, as average newsprint prices
increased 8.1%. In addition, daily circulation gains at the Company's largest
newspapers and acquisitions contributed to an increase in newsprint consumption
of 6.5%. Non-newsprint expense rose 2.4% for 1998, excluding the impact of
acquisitions as well as restructuring, one-time and other charges.

     In 1998, the Newspaper Publishing segment recorded $102.5 million of
restructuring and one-time charges as well as $13.9 million of additional
charges that did not qualify for accounting classification as restructuring
charges. These charges consisted primarily of termination benefits, contract
termination costs and asset write-offs. In 1997, the Newspaper Publishing
segment's operating profit was impacted by $18.0 million of charges that were
not classified as restructuring charges. These charges primarily related to the
reorganization of the circulation department and the absorption of the corporate
human resources and information systems functions by The Times.

                                       19
<PAGE>   21

PROFESSIONAL INFORMATION

     Professional Information revenues and operating profit were as follows
(dollars in millions):

<TABLE>
<CAPTION>
                                          1999     CHANGE     1998     CHANGE     1997
                                         ------    ------    ------    ------    ------
<S>                                      <C>       <C>       <C>       <C>       <C>
Revenues...............................  $235.4     11.1%    $211.9      8.5%    $195.3
                                         ======              ======              ======
Operating profit.......................  $ 64.8     47.7%    $ 43.9    (21.2)%   $ 55.7
                                         ======              ======              ======
Operating profit excluding
  restructuring, one-time and other
  charges..............................  $ 64.8     16.2%    $ 55.7       .2%    $ 55.7
                                         ======              ======              ======
</TABLE>

1999 Results

     The operating results for the Professional Information segment consist
entirely of Jeppesen, the Company's flight information provider, after
reflecting AchieveGlobal, Allen Communication and StayWell as discontinued
operations for all periods presented. Jeppesen demonstrated outstanding
performance in 1999 as revenues and operating profit rose as a result of strong
product demand and growth in the commercial aviation market, as well as higher
flight planning revenues.

1998 Results

     Revenues for 1998 increased primarily due to higher revenues for navigation
and standard airway manual services. Operating profit was consistent with the
prior year due to higher expenses related to chart revision activity and
technology initiatives.

     In 1998, the Company recorded $8.2 million of restructuring and one-time
charges, which consisted primarily of termination benefits, lease termination
and other costs. The Company recorded additional charges of $3.7 million that
did not qualify for accounting classification as restructuring charges. These
charges were primarily to write-off capitalized software costs related to an
abandoned project.

MAGAZINE PUBLISHING

     Magazine Publishing revenues and operating profit (loss) were as follows
(dollars in millions):

<TABLE>
<CAPTION>
                                         1999     CHANGE     1998     CHANGE     1997
                                        ------    ------    ------    ------    ------
<S>                                     <C>       <C>       <C>       <C>       <C>
Revenues:
  Advertising.........................  $185.9      8.1%    $171.9      7.6%    $159.7
  Circulation.........................    75.3     (1.2)      76.2      1.1       75.4
  Other...............................    17.7     21.8       14.6      7.3       13.6
                                        ------              ------              ------
                                        $278.9      6.2%    $262.7      5.6%    $248.7
                                        ======              ======              ======
Operating profit (loss)...............  $ 19.2    (100+)%   $(14.2)   (100+)%   $ 18.3
                                        ======              ======              ======
Operating profit excluding
  restructuring, one-time and other
  charges.............................  $ 19.2     29.3%    $ 14.8    (18.9)%   $ 18.3
                                        ======              ======              ======
</TABLE>

1999 Results

     Magazine Publishing's 1999 operating profit increased significantly due
primarily to advertising revenue gains at most of the titles as well as lower
paper, printing and distribution costs. Excluding The Sporting News, 1999
operating profit was $25.9 million compared to $21.3 million in the prior year
and revenues in 1999 were $241.7 million compared to $227.1 million in the prior
year. Circulation revenues were consistent with the prior year. Other revenues
increased in 1999 compared to 1998 due primarily to subscription list rental
fees and television show sponsorships.

                                       20
<PAGE>   22

1998 Results

     Revenues increased in 1998 due to higher advertising revenues at most of
the magazines. The acquisitions of TransWorld SKATEboarding and Warp in April
1997, Ride BMX and SNAP in January 1998, InterZine Productions, Inc. in February
1998 and Senior Golfer in October 1998 also contributed to higher advertising
revenues. Excluding acquisitions, revenues rose 4.2%. Magazine Publishing
segment's 1998 operating profit decreased from 1997 due to investment in the
relaunch of The Sporting News, higher paper costs, as well as the acquisitions
of InterZine and Senior Golfer.

     Magazine Publishing segment's 1998 restructuring and one-time charges
totaled $29.1 million, which consisted primarily of goodwill impairment related
to two titles acquired in 1977 and 1987.

CORPORATE AND OTHER

     Corporate and Other revenues and operating losses were as follows (dollars
in millions):

<TABLE>
<CAPTION>
                                            1999     CHANGE    1998     CHANGE    1997
                                            -----    ------    -----    ------    -----
<S>                                         <C>      <C>       <C>      <C>       <C>
Revenues..................................  $  .6    (46.7)%   $ 1.2    (94.5)%   $21.8
                                            =====              =====              =====
Operating loss............................  $70.5    (11.0)%   $79.3     (6.6)%   $84.9
                                            =====              =====              =====
Operating loss excluding restructuring,
  one-time and other charges..............  $70.5     13.3%    $62.2    (26.7)%   $84.9
                                            =====              =====              =====
</TABLE>

1999 Results

     Operating loss was higher in 1999 due to implementation costs to
consolidate financial and human resource applications at a central processing
site, as well as costs related to Times Mirror interactive, the Company's
recently formed Internet unit.

1998 Results

     For 1998, revenues declined due to the dispositions of Harry N. Abrams,
Incorporated and National Journal, Inc. Operating loss decreased in 1998 from
1997 due primarily to lower employee benefit costs. Additionally, information
systems costs were lower in 1998 due to substantial completion of the Company's
conversion to common financial systems in 1997.

     Corporate and Other's 1998 restructuring and one-time charges totaled $15.9
million and $1.1 million for other charges that did not qualify for accounting
classification as restructuring charges. These charges consisted primarily of
termination benefits and lease termination costs.

OTHER, NET

1999 Results

     The 1999 results included a net pretax gain on the sale of America Online,
Inc. (AOL) shares and the purchase of the related 4 1/4% Premium Equity
Participating Securities (PEPS), of $16.9 million, or $10.0 million after
applicable taxes. The PEPS hedge the Company's investment in AOL. Such
transactions may continue from time to time in the future. The Company also
recorded a pretax gain on the sale of Hollywood Online, Inc. of $17.2 million,
or $10.7 million after applicable taxes. In addition, the Company had other
gains on non-operating items and reduced the carrying value of certain new media
and other investments. The Company also recognized equity income of $4.1 million
in 1999 from its investment in TMCT II which could experience significant
variability in the future due to the nature of TMCT II's investments (see Note
2).

1998 Results

     In the second half of 1998, the Company sold 441,900 shares of Netscape
Communications Corporation (Netscape), which was subsequently purchased by AOL,
and purchased the related PEPS, for a net pretax
                                       21
<PAGE>   23

gain of $16.0 million, or $9.5 million after applicable taxes. Additionally, the
Company recorded gains in 1998 on the disposition of excess real estate and
other assets and recorded equity losses related to new media and other
partnership investments.

INCOME TAXES

     The effective income tax rates were 41.0%, 45.3% and 40.8% in 1999, 1998
and 1997, respectively. Goodwill impairment charges for which there were no tax
benefit contributed to the higher tax rate in 1998.

RESTRUCTURING, ONE-TIME AND OTHER CHARGES

     In 1998, the Company undertook a comprehensive review of its business
operations to determine areas where operational efficiencies could be achieved
through either product and/or facility consolidation, headcount reductions,
product abandonments, contract terminations or other measures. The Company began
this review in anticipation of the impact of its significant 1998 divestitures
and to better align its overall cost structure and business configurations (see
Note 7). A summary of the significant components of the 1998 restructuring
program is as follows (dollars in millions):

<TABLE>
<CAPTION>
                                NEWSPAPER     PROFESSIONAL     MAGAZINE     CORPORATE
                                PUBLISHING    INFORMATION     PUBLISHING    AND OTHER    TOTAL
                                ----------    ------------    ----------    ---------    ------
<S>                             <C>           <C>             <C>           <C>          <C>
Termination benefits..........    $ 43.4          $2.0          $  .2         $10.2      $ 55.8
Contract terminations.........      51.4            --            4.3            --        55.7
Goodwill impairments..........        .3            --           19.7            --        20.0
Lease termination costs.......       2.3           2.8            1.5           3.1         9.7
Technology asset write-offs...       4.8           1.4             .1           1.5         7.8
Other costs...................        .3           2.0            3.3           1.1         6.7
                                  ------          ----          -----         -----      ------
          Total...............    $102.5          $8.2          $29.1         $15.9      $155.7
                                  ======          ====          =====         =====      ======
</TABLE>

     The following table summarizes the 1999 activity in the 1998 restructuring
liability balance as well as estimated cash flows for the following years
(dollars in millions):

<TABLE>
<CAPTION>
                                                                             ESTIMATED CASH FLOWS
                                                                             ---------------------
                            DECEMBER 31,        1999         DECEMBER 31,               2001 AND
                                1998        CASH PAYMENTS        1999         2000     THEREAFTER
                            ------------    -------------    ------------    ------    -----------
<S>                         <C>             <C>              <C>             <C>       <C>
Termination benefits......     $51.2           $(37.2)          $14.0        $11.4        $2.6
Contract terminations.....      31.3            (22.7)            8.6          3.8         4.8
Lease termination costs...       6.2             (2.5)            3.7          2.6         1.1
Technology asset
  write-offs..............        .6              (.5)             .1           .1          --
Other costs...............        .7              (.3)             .4           .4          --
                               -----           ------           -----        -----        ----
          Total...........     $90.0           $(63.2)          $26.8        $18.3        $8.5
                               =====           ======           =====        =====        ====
</TABLE>

     As planned, annual expense reductions resulting from the 1998 restructuring
program remain in line with management's expectations. The Company believes that
cash flows from operations will be adequate to cover future cash outflows under
the restructuring program.

     In addition to the 1998 charges listed above, the Company also recorded
$18.7 million for certain asset write-offs that did not meet the accounting
criteria for classification as "restructuring and one-time charges." These
charges, which principally included other operating asset write-offs, were
classified within "Selling, general and administrative expenses" in the
Consolidated Statements of Income.

     In 1997, the Company recorded pretax charges of $18.0 million for
specifically identified cost reduction programs that were not classified as
restructuring charges. The Company also recorded restructuring,

                                       22
<PAGE>   24

impairment and one-time charges in 1995. A summary of the activity with respect
to the 1995 restructuring liability is as follows (dollars in millions):

<TABLE>
<CAPTION>
                                              DECEMBER 31,        1999         DECEMBER 31,
                                                  1998        CASH PAYMENTS        1999
                                              ------------    -------------    ------------
<S>                                           <C>             <C>              <C>
1995 Restructuring..........................     $22.9           $(11.0)          $11.9
</TABLE>

     The remaining 1995 restructuring liability relates primarily to lease
payments on unoccupied properties, which will be paid over lease periods
extending to 2010.

     The Company periodically assesses the adequacy of its remaining
restructuring liabilities and makes adjustments, if required. The net change in
the restructuring liabilities as a result of these reviews has been not
significant.

LIQUIDITY AND CAPITAL RESOURCES

     The Company's operating cash requirements are funded primarily by its
operations. Cash generated from operating activities was used primarily to fund
capital expenditures, investments in new media businesses, dividend payments
and, to a lesser extent, share purchases. In 1999, funds from the Company's
investment affiliates created as part of the 1998 divestitures of the Company's
legal and medical publishing businesses, as well as proceeds from new debt
issuances were used to finance the 1999 recapitalization and acquisitions. In
the second half of 1998, the Company utilized a portion of the investment
affiliates' resources for share purchases and acquisitions. During 2000, the
Company plans to use proceeds from the planned dispositions of The Sporting
News, StayWell, Allen Communication and AchieveGlobal to repay debt, fund
acquisitions and, to a lesser extent, purchase the Company's common stock to
offset the dilutive effect of stock option exercises.

CASH FLOW

     The following table sets forth certain items from the Consolidated
Statements of Cash Flows (dollars in millions):

<TABLE>
<CAPTION>
                                                                1999         1998
                                                              ---------    --------
<S>                                                           <C>          <C>
Net cash provided by operating activities of continuing
  operations................................................  $   349.7    $  248.4
Capital expenditures........................................     (173.5)     (131.5)
Acquisitions, net of cash acquired..........................     (173.3)     (200.8)
Contribution to TMCT II, LLC................................   (1,235.3)         --
Proceeds from reorganization as described in Notes 4 and
  5.........................................................         --     2,022.2
Purchase of Times Mirror's common stock, including exercise
  of put options, net of premiums received..................     (211.9)     (964.7)
Net issuance of commercial paper, short-term borrowings and
  long-term debt............................................      491.8       141.4
</TABLE>

     Cash generated by operating activities of continuing operations for 1999
was higher compared to 1998 due primarily to higher earnings.

     Capital expenditures for 1999 were higher compared to 1998 due primarily to
the Company's continuing investments for future growth, which included facility
renovations within the Newspaper Publishing segment and conversion to a 50-inch
web at The Times. Additionally, the Company increased capital spending related
to information technology projects, including Year 2000 requirements. Capital
expenditures are currently expected to approximate $180.0 million for 2000,
primarily for facility renovations and upgrading business systems.

     Cash and marketable securities decreased to $144.3 million at December 31,
1999 from $1.10 billion at December 31, 1998 and total debt at December 31, 1999
rose to $1.82 billion from $1.25 billion at December 31, 1998 due primarily to
the 1999 recapitalization (see Note 2).

     At December 31, 1999, the Company had a $400.0 million long-term revolving
line of credit through a group of domestic and international banks. This line of
credit is used to support a commercial paper program,

                                       23
<PAGE>   25

which is available for short-term cash requirements. The Company had $241.4
million and $219.0 million of commercial paper outstanding at December 31, 1999
and March 8, 2000, respectively.

     At December 31, 1999, the Company had $400.0 million remaining under shelf
registration statements that had not been utilized. There is no assurance that
the Company will be able to utilize the amounts remaining under these shelf
registration statements on terms acceptable to the Company.

ACQUISITIONS

     In February 1999, Eagle New Media Investments, LLC acquired Newport Media,
Inc., a publisher of shopper publications in the Long Island and New Jersey
areas, for approximately $132.0 million. The Company made other acquisitions in
1999 for an aggregate consideration of $41.3 million.

     In April 1998, the Company acquired the Los Angeles area business of E Z
Buy & E Z Sell Recycler Corporation (Recycler), consisting primarily of the
Recycler publications in the Los Angeles, Orange, Riverside, San Bernardino and
Ventura counties and a portion of Santa Barbara County for $188.7 million. The
Company also invested in preferred stock and provided a term loan to Target
Media Partners, a new entity that owns all of the non-Los Angeles area assets of
Recycler, for a total amount of $34.8 million. The Company made other
acquisitions in 1998 for an aggregate consideration of $12.1 million.

DISPOSITIONS

     In May 1999, the Company completed an agreement to merge Hollywood Online,
Inc., and its Web site, hollywood.com, into Hollywood.com, Inc. (formerly Big
Entertainment, Inc.), in exchange for newly-issued restricted stock of
Hollywood.com, Inc. and a note with a then combined current value of
approximately $31.5 million. Additionally, the Company completed the sale of
Apartment Search, Inc. in March 1999. The estimated loss on sale of Apartment
Search, including a provision for operating losses through the date of disposal,
was recorded in the third quarter of 1998.

     In July 1998, the Company completed the divestiture of Matthew Bender in a
tax-free reorganization and the sale of the Company's 50% ownership interest in
Shepard's to Reed Elsevier plc. The two transactions were valued at $1.65
billion in the aggregate. In October 1998, the Company completed the divestiture
of Mosby, Inc. to Harcourt General, Inc. in a transaction valued at $415.0
million. Concurrently with the closing of the Matthew Bender and Mosby, Inc.
transactions, the Company became the sole manager of Eagle New Media
Investments, LLC (Eagle New Media) and Eagle Publishing Investments, LLC (Eagle
Publishing). A substantial portion of the assets of Eagle New Media and Eagle
Publishing were utilized in connection with the 1999 recapitalization (see Note
2). The Company intends to deploy the assets of both Eagle New Media and Eagle
Publishing to finance acquisitions and investments, including purchases of the
Company's common stock, and does not intend to use those funds for the Company's
general working capital purposes.

COMMON SHARE PURCHASES

     During 1999, the Company and Eagle New Media purchased 3.2 million shares
of the Company's Series A common stock which more than offset 2.0 million shares
issued as a result of the exercise of stock options (see Note 2 for further
information on the effective retirement of shares resulting from the 1999
recapitalization).

     The Company believes that the purchase of shares of its common stock is an
attractive investment for Eagle New Media which will also enhance Times Mirror
shareholder value as well as offset dilution from shares of common stock issued
under the Company's stock-based employee compensation and benefit programs. The
Company and its affiliates expect to make share purchases primarily to offset
stock option exercises, during the next two years in the open market or in
private transactions, depending on market conditions, and such purchases may be
discontinued at any time. In connection with this program, the Company from time
to time sells put options on its common stock. As of December 31, 1999, the
Company and its affiliates are authorized to purchase 3.9 million shares of
Series A common stock.

                                       24
<PAGE>   26

DIVIDENDS

     Cash dividends of $.80 and $.72 per share of common stock were declared for
the years ended December 31, 1999 and 1998, respectively. In February 2000, the
Board of Directors approved an increase in the quarterly dividend on its common
stock to $.22 per share, from $.20 per share, beginning with the March 10, 2000
payment date.

MARKET RISK

     The Company enters into contractual agreements in the ordinary course of
business to hedge its exposure to changes in interest rates, the value of
foreign currencies relative to the U.S. dollar and newsprint prices.
Counterparties to these agreements are major institutions. Such agreements are
not entered into for trading purposes.

     The Company's debt portfolio is managed to maintain a balance of fixed and
variable rate obligations. The Company utilizes interest rate swap agreements to
help maintain the overall interest rate parameters set by management. As such, a
hypothetical 10% change in interest rates would not have a material impact on
the Company's results of operations or the fair values of its market risk
sensitive financial instruments.

     The Company periodically enters into foreign exchange forward contracts or
uses other hedging strategies to substantially limit its exposure to changes in
foreign currency rates. As such, changes in currency rates would not have a
material impact on the Company's results of operations.

     Newsprint expense represents a significant portion of the Company's
operating costs. To manage the Company's exposure to newsprint price
fluctuations, the Company has entered into newsprint hedging contracts not
exceeding five years. These hedging arrangements have the effect of locking in
for specified periods, the newsprint prices the Company will pay for the hedged
volumes. As a result, while these hedging arrangements are structured to reduce
the Company's exposure to increases in newsprint prices, they also limit the
benefit the Company might otherwise have received from any newsprint price
decreases. The Company's operating results typically can be adversely affected
to the extent that such historically volatile newsprint prices increase
materially.

IMPACT OF YEAR 2000

     The Company instituted a comprehensive program to address potential Year
2000 impacts and as a result, critical systems and infrastructure operated
smoothly through the arrival of Year 2000 and leap year boundaries.
Additionally, the Company experienced no Year 2000 related disruptions in the
products and services provided by its significant suppliers or other third-party
business relationships. Many of the improvements made in preparation for the
Year 2000 are expected to provide the Company with long-term benefits. For
example, many of the advancements in technology for the Company's editorial,
advertising and circulation systems, e-mail, telephone switching, and network
infrastructure are each expected to have a significant, lasting impact.

YEAR 2000 COSTS

     The Company incurred costs of $39.7 million to prepare for the arrival of
the Year 2000, excluding costs for employees working on the project, of which
$30.5 million was capitalized and $9.2 million was expensed. These costs include
1999 capital expenditures of $14.7 million and expenses of $5.4 million. During
1999, an average of 104 employees worked on the project with related costs
estimated at $8.4 million. These costs include both information technology and
non-information technology systems, including capital costs associated with
planned replacements previously budgeted which, incidentally, provided Year 2000
compliance. Year 2000 costs were funded through operating cash flows.

DISCONTINUED BUSINESSES

     The above discussion of the Company's Year 2000 program does not include
information with respect to AchieveGlobal, Allen Communication or StayWell,
which are reflected as discontinued operations. However,
                                       25
<PAGE>   27

the information provided above would not be materially different if information
regarding the discontinued businesses was included. The Company incurred costs
of $2.6 million to prepare these businesses for the arrival of the Year 2000,
excluding costs for employees working on the project, of which $1.6 million was
capitalized and $1.0 million was expensed. These costs include 1999 capital
expenditures and expenses of $.5 million each.

CERTAIN FACTORS AFFECTING FORWARD-LOOKING STATEMENTS

     In 1998, the Company divested Matthew Bender & Company, Incorporated and
Mosby, Inc. While the Company believes that these divestitures were completed on
a tax-free basis, this position may be subject to review by the Internal Revenue
Service. The Company estimated deferred taxes of $176.6 million based on its
assessment of the risks inherent in a contested challenge by the Internal
Revenue Service. To the extent that the estimate of such deferred taxes is
adjusted in the course of resolving such a challenge, the adjustment will be
recorded within discontinued operations. If it is ultimately determined that
these transactions were not completed on a tax-free basis, the Company's results
of operations, financial position and cash flow may be materially adversely
affected.

     Certain statements set forth above and elsewhere in this Annual Report on
Form 10-K are forward-looking in nature and related to trends and events that
may affect the Company's future financial position and operating results. Such
statements are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. The term "expect," "anticipate," and
"intend" and similar words or expressions are intended to identify
forward-looking statements. These statements speak only as of the date of this
report. These statements are based on current expectations, are inherently
uncertain, are subject to risks, and should be viewed with caution. For example,
there can be no assurances that the statements contained herein with respect to
expected dispositions of certain businesses, share purchases, capital
expenditures or the satisfactory resolution of contingent liabilities will be
achieved.

     Actual results and experience may differ materially from the
forward-looking statements and could be adversely affected by a number of
factors, including (a) an increase in paper, printing and distribution costs
over the levels anticipated; (b) increased consolidation among major retailers
or other events depressing the level of display advertising; (c) an economic
downturn in the Company's principal newspaper markets or other occurrences
leading to decreased circulation and diminished revenues from both display and
classified advertising; (d) an increase in the use of alternate media such as
the Internet for classified and other advertising; (e) an increase in expenses
related to new initiatives and product improvement efforts in the flight
information operating unit; (f) unfavorable foreign currency fluctuations; (g)
material changes in tax liability due to unfavorable reviews by taxing
authorities as described above; and (h) a general economic downturn resulting in
decreased consumer and corporate spending on discretionary items such as
magazines or newspapers. It is not possible to foresee or identify all such
factors. The Company makes no commitment to update any forward-looking statement
or to disclose any facts, events, or circumstances after the date hereof that
may affect the accuracy of any forward-looking statement.

DISCUSSIONS EXCLUDING RESTRUCTURING, ONE-TIME AND OTHER CHARGES

     Management's discussion and analysis of its results of operations presents
information regarding operating profit as well as operating profit excluding the
impact of restructuring, one-time and other charges. The Company believes that
the financial information which excludes restructuring, one-time and other
charges is necessary to an understanding of its operations and provides for a
more comparable analysis of historical results as well as indications of future
financial performance.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

     This information is presented in Management's Discussion and Analysis of
Financial Condition and Results of Operations under the caption "Liquidity and
Capital Resources -- Market Risk."

                                       26
<PAGE>   28

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

                         INDEX TO FINANCIAL STATEMENTS
                        AND FINANCIAL STATEMENT SCHEDULE

<TABLE>
<CAPTION>
                                                              PAGE
                                                              ----
<S>                                                           <C>
Report of Ernst & Young LLP, Independent Auditors...........   28
Consolidated Statements of Income -- Years Ended December
  31, 1999, 1998 and 1997...................................   29
Consolidated Balance Sheets -- December 31, 1999 and
  December 31, 1998.........................................   30
Consolidated Statements of Shareholders' Equity -- Years
  Ended December 31, 1999, 1998 and 1997....................   32
Consolidated Statements of Cash Flows -- Years Ended
  December 31, 1999, 1998 and 1997..........................   34
Notes to Consolidated Financial Statements..................   35
Financial Statement Schedule:
  Schedule II -- Valuation and Qualifying Accounts and
     Reserves...............................................   65
</TABLE>

     All other schedules are omitted because they are not required by the
regulations or related instructions or are not applicable.

                                       27
<PAGE>   29

               REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

To the Shareholders and Board of Directors
The Times Mirror Company

     We have audited the accompanying consolidated balance sheets of The Times
Mirror Company as of December 31, 1999 and 1998, and the related consolidated
statements of income, shareholders' equity and cash flows for each of the three
years in the period ended December 31, 1999. Our audits also include the
financial statement schedule listed in the Index to Financial Statements and
Financial Statement Schedule. These financial statements and schedule are the
responsibility of the 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 auditing standards generally
accepted in the 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 Times
Mirror Company at December 31, 1999 and 1998, and the consolidated results of
its operations and its cash flows for each of the three years in the period
ended December 31, 1999, in conformity with accounting principles generally
accepted in the United States. 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.

                                          ERNST & YOUNG LLP

Los Angeles, California
February 2, 2000

                                       28
<PAGE>   30

                            THE TIMES MIRROR COMPANY

                       CONSOLIDATED STATEMENTS OF INCOME
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                 YEAR ENDED DECEMBER 31
                                                         --------------------------------------
                                                            1999          1998          1997
                                                         ----------    ----------    ----------
<S>                                                      <C>           <C>           <C>
REVENUES:
  Advertising..........................................  $2,214,902    $1,993,750    $1,855,999
  Circulation..........................................     505,598       512,090       515,941
  Other................................................     308,749       278,148       273,195
                                                         ----------    ----------    ----------
          Total revenues...............................   3,029,249     2,783,988     2,645,135
                                                         ----------    ----------    ----------
COSTS AND EXPENSES:
  Cost of sales........................................   1,615,273     1,444,523     1,395,660
  Selling, general and administrative expenses.........     943,470       935,986       858,197
  Restructuring and one-time charges...................          --       155,681            --
                                                         ----------    ----------    ----------
          Total costs and expenses.....................   2,558,743     2,536,190     2,253,857
                                                         ----------    ----------    ----------
OPERATING PROFIT.......................................     470,506       247,798       391,278
Interest expense.......................................     (93,368)      (68,275)      (35,628)
Interest income........................................      36,454        39,680         2,351
Other, net.............................................      25,699        25,801        38,498
                                                         ----------    ----------    ----------
Income from continuing operations before income
  taxes................................................     439,291       245,004       396,499
Income tax provision...................................     180,229       110,945       161,844
                                                         ----------    ----------    ----------
Income from continuing operations......................     259,062       134,059       234,655
Discontinued operations:
     Income (loss) from operations, net of taxes.......          24       (33,407)       15,657
     Net gain on disposal, net of taxes................          --     1,316,686            --
                                                         ----------    ----------    ----------
NET INCOME.............................................  $  259,086    $1,417,338    $  250,312
                                                         ==========    ==========    ==========
Preferred stock dividends..............................  $   18,066    $   21,697    $   32,481
                                                         ==========    ==========    ==========
Earnings applicable to common shareholders.............  $  241,020    $1,395,641    $  217,831
                                                         ==========    ==========    ==========

Basic earnings per common share:
     Continuing operations.............................  $     3.53    $     1.32    $     2.18
     Discontinued operations...........................          --         15.14           .17
                                                         ----------    ----------    ----------
Basic earnings per share...............................  $     3.53    $    16.46    $     2.35
                                                         ==========    ==========    ==========
Diluted earnings per common share:
     Continuing operations.............................  $     3.38    $     1.29    $     2.12
     Discontinued operations...........................          --         14.77           .17
                                                         ----------    ----------    ----------
Diluted earnings per share.............................  $     3.38    $    16.06    $     2.29
                                                         ==========    ==========    ==========
</TABLE>

See notes to consolidated financial statements.

                                       29
<PAGE>   31

                            THE TIMES MIRROR COMPANY

                          CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                     DECEMBER 31
                                                              -------------------------
                                                                 1999           1998
                                                              -----------    ----------
<S>                                                           <C>            <C>
ASSETS
  Current assets:
     Cash and cash equivalents..............................  $   144,319    $1,052,999
     Marketable securities..................................           --        49,438
     Accounts receivable, less allowances for doubtful
      accounts and returns of $34,721 and $37,389...........      363,361       311,913
     Inventories............................................       35,082        28,438
     Recoverable income taxes...............................       43,477        22,112
     Deferred income taxes..................................       33,314        32,279
     Prepaid expenses.......................................       35,526        30,141
     Net assets of discontinued operations..................      173,090       189,628
     Other current assets...................................       58,479        16,166
                                                              -----------    ----------
          Total current assets..............................      886,648     1,733,114
  Property, plant and equipment:
     Land...................................................       49,937        45,065
     Buildings..............................................      454,751       433,860
     Machinery and equipment................................    1,389,855     1,321,501
     Leasehold improvements.................................       37,248        27,848
     Construction-in-progress...............................       42,375        41,362
                                                              -----------    ----------
                                                                1,974,166     1,869,636
     Less accumulated depreciation and amortization.........   (1,008,071)     (966,153)
                                                              -----------    ----------
          Property, plant and equipment, net................      966,095       903,483
  Goodwill, net of accumulated amortization of $126,875 and
     $105,976...............................................      602,148       501,463
  Other intangibles, net of accumulated amortization of
     $74,612 and $61,657....................................      192,593       100,373
  Equity investments in TMCT I, LLC and TMCT II, LLC........      332,846        96,416
  Other investments.........................................      242,858       174,402
  Prepaid pension costs.....................................      445,175       419,471
  Other assets..............................................      229,008       229,207
                                                              -----------    ----------
          Total assets......................................  $ 3,897,371    $4,157,929
                                                              ===========    ==========
</TABLE>

See notes to consolidated financial statements.

                                       30
<PAGE>   32

                            THE TIMES MIRROR COMPANY

                    CONSOLIDATED BALANCE SHEETS (CONTINUED)
               (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                     DECEMBER 31
                                                              --------------------------
                                                                 1999           1998
                                                              -----------    -----------
<S>                                                           <C>            <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
  Current liabilities:
     Accounts payable.......................................  $   179,461    $   179,415
     Short-term debt........................................      254,834        312,610
     Employees' compensation................................      110,311         93,145
     Unearned income........................................      127,760        146,323
     Restructuring..........................................       25,795         91,903
     Other current liabilities..............................      167,969         98,106
                                                              -----------    -----------
          Total current liabilities.........................      866,130        921,502
  Long-term debt............................................    1,562,240        941,423
  Deferred income taxes.....................................      482,062        373,623
  Postretirement benefits...................................      221,111        226,018
  Other liabilities.........................................      338,808        330,350
                                                              -----------    -----------
          Total liabilities.................................    3,470,351      2,792,916
Common stock subject to put options.........................       27,291         22,560
Commitments and contingencies
Shareholders' equity:
  Preferred stock, $1 par value; stated at liquidation
     value, convertible to Series A common stock:
       Series A: 900,000 shares authorized; 824,000 shares
        issued and outstanding..............................      411,784        411,784
       Series B: 8,439,000 shares authorized; no shares
        issued or outstanding...............................           --             --
       Series C-1: 381,000 shares authorized, issued and
        outstanding.........................................      190,486        190,486
       Series C-2: 245,000 shares authorized, issued and
        outstanding.........................................      122,550        122,550
  Preferred stock, $1 par value; 23,035,000 shares
     authorized, no shares issued or outstanding............           --             --
  Common stock, $1 par value:
     Series A: 500,000,000 shares authorized; 93,879,000 and
      86,831,000 shares issued and outstanding..............       93,879         86,831
     Series B: 100,000,000 shares authorized; no shares
      issued or outstanding.................................           --             --
     Series C: Convertible to Series A common stock;
      300,000,000 shares authorized, 18,246,000 and
      25,258,000 shares issued and outstanding..............       18,246         25,258
  Additional paid-in capital................................    1,299,931      1,278,916
  Retained earnings.........................................    1,784,793      1,653,736
  Accumulated other comprehensive income....................       26,879         26,491
  Less treasury stock, at cost:
     Series A common stock, 52,387,000 and 38,708,000
      shares; Series A preferred stock, 735,000 shares;
      Series C-1 preferred stock, 305,000 and no shares; and
      Series C-2 preferred stock, 196,000 and no shares.....   (3,548,819)    (2,453,599)
                                                              -----------    -----------
          Total shareholders' equity........................      399,729      1,342,453
                                                              -----------    -----------
          Total liabilities and shareholders' equity........  $ 3,897,371    $ 4,157,929
                                                              ===========    ===========
</TABLE>

See notes to consolidated financial statements.

                                       31
<PAGE>   33

                            THE TIMES MIRROR COMPANY

                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                               THREE YEARS ENDED DECEMBER 31, 1999
---------------------------------------------------------------------------------------------------------------------------------
                                                                             PREFERRED STOCK                     COMMON STOCK
                                                              ---------------------------------------------   -------------------
                                                              SERIES A   SERIES B   SERIES C-1   SERIES C-2   SERIES A   SERIES C
                                                              --------   --------   ----------   ----------   --------   --------
<S>                                                           <C>        <C>        <C>          <C>          <C>        <C>
BALANCE AT DECEMBER 31, 1996................................  $411,784   $164,595    $     --     $     --    $69,757    $26,973
  Comprehensive income:
    Net income..............................................        --         --          --           --         --         --
    Other comprehensive income, net of income taxes:
      Change in net unrealized losses on securities.........        --         --          --           --         --         --
      Minimum pension liability adjustment..................        --         --          --           --         --         --
      Foreign currency translation adjustments..............        --         --          --           --         --         --
  Comprehensive income......................................        --         --          --           --         --         --
  Conversion to Series A common related to:
    Series C common.........................................        --         --          --           --     11,127    (11,127)
    Series B preferred......................................        --   (164,595)         --           --      4,446         --
  Merger with Chandis Securities............................        --         --     190,486      122,550      6,582      9,656
  Issuance/Purchase of shares:
    Stock options and restricted stock......................        --         --          --           --      1,070          1
    Acquisition.............................................        --         --          --           --         45         --
    Stock purchase program..................................        --         --          --           --     (6,475)        --
    TMCT I, LLC contributed shares..........................        --         --          --           --         --         --
  Put options:
    Sale....................................................        --         --          --           --         --         --
    Exercise................................................        --         --          --           --         --         --
    Change in redemption value..............................        --         --          --           --         --         --
  Dividends declared:
    Common stock; $.55 per share............................        --         --          --           --         --         --
    Preferred stock.........................................        --         --          --           --         --         --
                                                              --------   --------    --------     --------    -------    -------
BALANCE AT DECEMBER 31, 1997................................   411,784         --     190,486      122,550     86,552     25,503
  Comprehensive income:
    Net income..............................................        --         --          --           --         --         --
    Other comprehensive income, net of income taxes:
      Change in net unrealized gains on securities..........        --         --          --           --         --         --
      Minimum pension liability adjustment..................        --         --          --           --         --         --
      Foreign currency translation adjustments..............        --         --          --           --         --         --
  Comprehensive income......................................        --         --          --           --         --         --
  Conversion of Series C common to Series A common..........        --         --          --           --        245       (245)
  Issuance/Purchase of shares:
    Stock options and restricted stock......................        --         --          --           --         34         --
    Purchases of common stock...............................        --         --          --           --         --         --
  Put options:
    Sale....................................................        --         --          --           --         --         --
    Exercise................................................        --         --          --           --         --         --
    Change in redemption value..............................        --         --          --           --         --         --
  Dividends declared:
    Common stock; $.72 per share............................        --         --          --           --         --         --
    Preferred stock.........................................        --         --          --           --         --         --
                                                              --------   --------    --------     --------    -------    -------
BALANCE AT DECEMBER 31, 1998................................   411,784         --     190,486      122,550     86,831     25,258
  Comprehensive income:
    Net income..............................................        --         --          --           --         --         --
    Other comprehensive income, net of income taxes:
      Change in net unrealized losses on securities.........        --         --          --           --         --         --
      Minimum pension liability adjustment..................        --         --          --           --         --         --
      Foreign currency translation adjustments..............        --         --          --           --         --         --
  Comprehensive income......................................        --         --          --           --         --         --
  Conversion of Series C common to Series A common..........        --         --          --           --        776       (776)
  Issuance/Purchase of shares:
    Stock options and restricted stock......................        --         --          --           --         36         --
    Purchases of common stock...............................        --         --          --           --         --         --
    TMCT II, LLC contributed shares.........................        --         --          --           --      6,236     (6,236)
  Put options:                                                                             --
    Sale....................................................        --         --          --           --         --         --
    Exercise................................................        --         --          --           --         --         --
    Change in redemption value..............................        --         --          --           --         --         --
  Dividends declared:
    Common stock; $.80 per share............................        --         --          --           --         --         --
    Preferred stock.........................................        --         --          --           --         --         --
                                                              --------   --------    --------     --------    -------    -------
BALANCE AT DECEMBER 31, 1999................................  $411,784   $     --    $190,486     $122,550    $93,879    $18,246
                                                              ========   ========    ========     ========    =======    =======
</TABLE>

See notes to consolidated financial statements.

                                       32
<PAGE>   34

<TABLE>
<CAPTION>
------------------------------------------------------------------------
                                 ACCUMULATED
      ADDITIONAL                    OTHER
       PAID-IN      RETAINED    COMPREHENSIVE    TREASURY
       CAPITAL      EARNINGS       INCOME          STOCK        TOTAL
      ----------   ----------   -------------   -----------   ----------
<S>   <C>          <C>          <C>             <C>           <C>
      $  225,934   $  546,881      $52,886      $        --   $1,498,810
              --      250,312           --               --      250,312
              --           --      (38,170)              --      (38,170)
              --           --        1,902               --        1,902
              --           --       (3,814)              --       (3,814)
                                                              ----------
              --           --           --               --      210,230
              --           --           --               --           --
         160,119           (8)          --               --          (38)
         807,834           --           --       (1,125,064)      12,044
          45,711      (17,509)          --           32,741       62,014
           2,354           --           --               --        2,399
         (16,190)    (309,734)          --         (132,382)    (464,781)
              --           --           --         (380,093)    (380,093)
           3,227           --           --               --        3,227
            (419)          --           --           (6,527)      (6,946)
          24,572           --           --               --       24,572
              --      (50,885)          --               --      (50,885)
              --      (34,554)          --               --      (34,554)
      ----------   ----------      -------      -----------   ----------
       1,253,142      384,503       12,804       (1,611,325)     875,999
              --    1,417,338           --               --    1,417,338
              --           --       16,106               --       16,106
              --           --       (1,169)              --       (1,169)
              --           --       (1,250)              --       (1,250)
                                                              ----------
              --           --           --               --    1,431,025
              --           --           --               --           --
          31,906      (65,952)          --          125,229       91,217
              --           --           --         (947,203)    (947,203)
           2,891           --           --               --        2,891
             (63)          --           --          (20,300)     (20,363)
          (8,960)          --           --               --       (8,960)
              --      (60,456)          --               --      (60,456)
              --      (21,697)          --               --      (21,697)
      ----------   ----------      -------      -----------   ----------
       1,278,916    1,653,736       26,491       (2,453,599)   1,342,453
              --      259,086           --               --      259,086
              --           --       (8,864)              --       (8,864)
              --           --       (1,692)              --       (1,692)
              --           --       10,944               --       10,944
                                                              ----------
              --           --           --               --      259,474
              --           --           --               --           --
          22,823      (53,265)          --          120,442       90,036
              --           --           --         (196,471)    (196,471)
              --           --           --       (1,000,817)  (1,000,817)
           2,923           --           --               --        2,923
              --           --           --          (18,374)     (18,374)
          (4,731)          --           --               --       (4,731)
              --      (56,698)          --               --      (56,698)
              --      (18,066)          --               --      (18,066)
      ----------   ----------      -------      -----------   ----------
      $1,299,931   $1,784,793      $26,879      $(3,548,819)  $  399,729
      ==========   ==========      =======      ===========   ==========
</TABLE>

                                       33
<PAGE>   35

                            THE TIMES MIRROR COMPANY

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                     YEAR ENDED DECEMBER 31
                                                              -------------------------------------
                                                                 1999           1998         1997
                                                              -----------    ----------    --------
<S>                                                           <C>            <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Income from continuing operations.........................  $   259,062    $  134,059    $234,655
  Adjustments to derive cash flows from continuing operating
    activities:
    Depreciation and amortization...........................      144,955       135,175     124,064
    Restructuring and other charges:
      Impairments and other asset write-offs................           --        52,783          --
      Net change in restructuring liability.................      (74,228)       69,849     (15,764)
    Amortization of debt discount...........................       21,466        16,998       9,299
    Gain on asset sales and writedowns, net.................      (21,832)      (31,564)    (36,302)
    Provision for doubtful accounts.........................       18,643        19,240      22,307
    Provision for deferred income taxes.....................       44,764        11,417      41,587
    Changes in assets and liabilities:
      Accounts receivable...................................      (68,541)      (23,302)    (36,625)
      Inventories...........................................       (6,453)        2,755        (740)
      Prepaid pension costs.................................      (25,704)      (52,664)    (39,872)
      Accounts payable......................................       (6,695)      (21,557)     18,172
      Income taxes..........................................       18,777       (18,285)    (31,826)
    Other, net..............................................       45,517       (46,534)     66,098
                                                              -----------    ----------    --------
    Net cash provided by continuing operating activities....      349,731       248,370     355,053
    Net cash provided by (used in) discontinued operating
      activities............................................       31,495        72,906      (1,702)
                                                              -----------    ----------    --------
      Net cash provided by operating activities.............      381,226       321,276     353,351
                                                              -----------    ----------    --------
CASH FLOWS FROM INVESTING ACTIVITIES
  Capital expenditures......................................     (173,484)     (131,548)   (113,081)
  Acquisitions, net of cash acquired........................     (173,337)     (200,786)    (37,580)
  Purchases of investments..................................      (84,270)      (57,433)    (10,811)
  Proceeds from sales of investments and other assets.......       71,455        38,473     120,774
  Sale (purchase) of marketable securities, net.............       49,438       (49,438)         --
  Decreases (increases) in notes receivable, net............       13,000       (69,120)         --
  Proceeds from reorganization as described in Notes 4 and
    5.......................................................           --     2,022,224          --
  Other, net................................................       (7,242)       10,211       8,520
                                                              -----------    ----------    --------
    Net cash provided by (used in) investing activities of
      continuing operations.................................     (304,440)    1,562,583     (32,178)
    Net cash used in investing activities of discontinued
      operations............................................      (10,232)      (29,697)   (153,335)
                                                              -----------    ----------    --------
      Net cash provided by (used in) investing activities...     (314,672)    1,532,886    (185,513)
                                                              -----------    ----------    --------
CASH FLOWS FROM FINANCING ACTIVITIES
  Contribution to TMCT II, LLC..............................   (1,235,252)           --          --
  Purchases of Times Mirror common stock....................     (196,471)     (947,203)   (464,781)
  Dividends paid............................................      (74,764)      (82,153)    (85,439)
  Net proceeds (repayments) of commercial paper and
    short-term borrowings...................................      (57,485)      212,983      92,187
  Principal repayments of debt..............................      (46,567)      (71,550)     (5,769)
  Exercise of put options, net of premiums received.........      (15,451)      (17,472)     (3,719)
  Proceeds from issuance of long-term debt..................      595,896            --     445,429
  Proceeds from exercise of stock options...................       67,195        59,277      36,431
  Contribution to TMCT I, LLC...............................           --            --    (249,266)
  Other, net................................................      (12,335)          161     (17,098)
                                                              -----------    ----------    --------
      Net cash used in financing activities.................     (975,234)     (845,957)   (252,025)
                                                              -----------    ----------    --------
  Increase (decrease) in cash and cash equivalents..........     (908,680)    1,008,205     (84,187)
  Cash and cash equivalents at beginning of year............    1,052,999        44,794     128,981
                                                              -----------    ----------    --------
  Cash and cash equivalents at end of year..................  $   144,319    $1,052,999    $ 44,794
                                                              ===========    ==========    ========
</TABLE>

See notes to consolidated financial statements.

                                       34
<PAGE>   36

                            THE TIMES MIRROR COMPANY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Principles of Consolidation. The consolidated financial statements include
the accounts of the Company and its subsidiaries as well as affiliates that are
controlled by the Company, as described in Note 5, after elimination of all
significant intercompany transactions and balances. Other affiliated companies
in which the Company owns a 20% to 50% interest or has significant influence are
accounted for by the equity method.

     Presentation. Certain amounts in previously issued financial statements
have been reclassified to conform to the 1999 presentation. Financial
information presented in the notes to consolidated financial statements excludes
discontinued operations, except where noted.

     Use of Estimates. Financial statements prepared in accordance with
generally accepted accounting principles require management to make estimates
and judgments that affect amounts and disclosures reported in the financial
statements. Actual results could differ from those estimates.

     Changes in Accounting Principles. As of January 1, 1999, the Company
adopted the American Institute of Certified Public Accountants Statement of
Position (SOP) 98-1, "Accounting for the Costs of Computer Software Developed or
Obtained for Internal Use." SOP 98-1 requires the capitalization of certain
costs incurred after the date of adoption in connection with developing or
obtaining software for internal use. In prior years, the Company's accounting
policies for internal use software were generally consistent with the
requirements of SOP 98-1. Accordingly, the adoption of this pronouncement did
not have a material effect on the Company's financial position or results of
operations.

     Cash and Cash Equivalents. Cash equivalents consist of investments that are
readily convertible into cash and mature within three months from date of
purchase. Cash equivalents of $113.9 million and $997.7 million at December 31,
1999 and 1998, respectively, consist of commercial paper, money market funds or
certificates of deposit. The Company has an investment policy for short-term
investments covering eligible types of instruments, maximum investment terms,
credit quality and individual issuer limits.

     Under the Company's cash management system, the bank notifies the Company
daily of checks presented for payment against its primary disbursement accounts.
The Company transfers funds from other sources such as short-term investments or
commercial paper issuance to cover the checks presented for payment. This
program results in a book cash overdraft in the primary disbursement accounts as
a result of checks outstanding. The book overdraft, which was reclassified to
accounts payable, was $27.4 million and $41.3 million at December 31, 1999 and
1998, respectively.

     Marketable Securities. Marketable securities consist of investments in
commercial paper that have maturities over three months but less than one year
from date of purchase.

     Inventories. Inventories are stated at the lower of cost or market.
Newsprint is valued under the last-in, first-out (LIFO) method and paper and
certain finished products are valued primarily under the weighted average cost
method.

     Property, Plant and Equipment. Property, plant and equipment is stated on
the basis of cost. Maintenance and repairs are charged to expense as incurred.
Additions, improvements and replacements are capitalized.

     Depreciation is provided on a straight-line basis over the estimated useful
lives as follows:

<TABLE>
<S>                                            <C>
Buildings....................................  10 - 45 years
Machinery and equipment......................  3 - 20 years
Leasehold improvements.......................  Lesser of useful life or lease term
</TABLE>

     Goodwill and Other Intangibles. Goodwill recognized in business
combinations accounted for as purchases is being amortized on a straight-line
basis primarily over periods of 15 to 40 years, with a weighted

                                       35
<PAGE>   37
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

average amortization period of 35 years. Goodwill amortization expense was $22.5
million, $18.0 million and $13.9 million for the years ended December 31, 1999,
1998 and 1997, respectively.

     Other intangibles arising in connection with acquisitions are being
amortized on a straight-line basis over their estimated useful lives ranging
primarily from 5 to 30 years, with a weighted average life of 27 years.
Amortization expense was $15.1 million, $9.9 million and $7.6 million for the
years ended December 31, 1999, 1998 and 1997, respectively.

     The Company assesses on an ongoing basis the recoverability of long-lived
assets, including goodwill and other intangible assets, based on estimates of
future undiscounted cash flows for the applicable business compared to net book
value. If the future undiscounted cash flows estimate were less than net book
value, net book value would then be reduced to fair value based on an estimate
of discounted cash flows. The Company also evaluates the amortization periods of
these assets to determine whether events or circumstances warrant revised
estimates of useful lives.

     Deferred Charges. Magazine subscription procurement costs are charged to
expense over the same period as the related revenue is earned.

     Derivative Financial Instruments. Interest rate swaps (see Note 9) are used
to manage exposure to market risk associated with changes in interest rates.
Interest rate swaps are accounted for on the accrual basis. Payments made or
received are recognized as an adjustment to interest expense. Amounts received
or paid in connection with initiating or terminating swaps are amortized on a
straight-line basis as a reduction or increase in interest expense over the term
of the swaps.

     Premium equity participating debt securities (see Note 12) are used to
manage the Company's exposure to market risk associated with changes in the fair
value of the Company's investment in the common stock of America Online, Inc.
(AOL).

     The Company's exposure to market risk associated with fluctuations in the
value of foreign currencies relative to the U.S. dollar may be managed with
foreign currency forward contracts, currency options, currency swaps or other
risk management instruments permitted by the Company's internal policy
guidelines. The Company's forward contracts and other risk management
instruments were not significant.

     Commodity price hedging contracts (see Note 9) are used to manage the
Company's exposure to market risk associated with fluctuations in newsprint
prices. These contracts are accounted for on the accrual basis. Periodic
settlement payments made or received are recognized as an adjustment to the cost
basis of newsprint inventory. Amounts paid in connection with initiating these
contracts are amortized on a straight-line basis as an adjustment to the cost
basis of newsprint inventory over the term of the contracts.

     Put options are used in conjunction with the Company's common stock
purchase program. These contracts are entered into based on market conditions as
well as other factors. The costs or benefits derived from these equity-based
financial instruments are recorded in shareholders' equity on the date of the
transaction. The potential obligation under these put options outstanding at
December 31, 1999 and 1998 has been transferred from shareholders' equity to
"Common stock subject to put options."

     Revenue Recognition. Revenues from certain products sold with the right of
return, are recognized net of a provision for estimated returns. Revenues from
newspaper and magazine subscriptions and annual subscriptions for aeronautical
charts are deferred as unearned income at the time of the sale. A pro rata share
of the newspaper and magazine subscription price is included in revenue as
products are delivered to subscribers. Annual subscription revenues for
aeronautical charts are recognized on a straight-line basis over the life of the
subscription service.

                                       36
<PAGE>   38
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     Advertising and Promotion Costs. Advertising and promotion costs, which are
expensed as incurred, amounted to $70.9 million, $59.9 million and $64.8 million
for the years ended December 31, 1999, 1998 and 1997, respectively.

     Foreign Currency Translation. The assets and liabilities of foreign
operations are translated at year-end exchange rates. Results of operations are
translated at average exchange rates in effect during the year. Translation
adjustments are included in "Accumulated other comprehensive income" in the
Consolidated Balance Sheets and Statements of Shareholders' Equity.

     Stock-Based Compensation. Employee stock options (see Note 14) are
accounted for under Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees," which requires the recognition of expense when the
option price is less than the fair value of the stock at the date of grant. The
Company awards options for a fixed number of shares at an option price equal to
the fair value at the date of grant. Accordingly, the financial statements do
not include any expense related to employee stock option awards. The Company has
adopted the disclosure-only provisions of Statement of Financial Accounting
Standards (SFAS) No. 123, "Accounting for Stock-Based Compensation."

     Future Accounting Requirement. In June 1998, the Financial Accounting
Standards Board (FASB) issued Statement No. 133 "Accounting for Derivative
Instruments and Hedging Activities" (SFAS 133). Subsequently, the FASB issued
Statement No. 137, "Accounting for Derivative Instruments and Hedging
Activities -- Deferral of the Effective Date of FASB Statement No. 133" which
deferred the effective date of SFAS 133 for one year. This standard is effective
for all fiscal quarters of all fiscal years beginning after June 15, 2000. SFAS
133 will require the Company to record all derivatives as assets or liabilities
at fair value. Changes in derivative fair values will either be recognized in
earnings, offset against changes in the fair value of the related hedged assets,
liabilities and firm commitments or, for forecasted transactions, recorded as a
component of accumulated other comprehensive income in shareholders' equity
until the hedged transactions occur and are recognized in earnings. The
ineffective portion of a hedging derivative's change in fair value will be
recognized in earnings immediately. The impact of SFAS 133 on the Company's
financial statements will depend on a variety of factors, including, the extent
of the Company's hedging activities, the types of hedging instruments used and
the effectiveness of such instruments. The effect of adopting SFAS 133 is
currently being evaluated, however, management does not anticipate that the
adoption of this standard will have a significant effect on earnings or the
financial position of the Company.

NOTE 2 -- 1999 RECAPITALIZATION

     In September 1999, the Company completed a transaction (1999
recapitalization) involving agreements with its largest shareholders, Chandler
Trust No. 1 and Chandler Trust No. 2 (Chandler Trusts). The 1999
recapitalization resulted in the formation of a new limited liability company,
TMCT II, LLC (TMCT II).

     Pursuant to the TMCT II contribution agreement, the Company, Eagle New
Media Investments, LLC and Eagle Publishing Investments, LLC (Eagle Companies)
and the Chandler Trusts made the following capital contributions to TMCT II:

        1. The Company contributed preferred units issued by the operating
           partnerships of 8 unrelated real estate investment trusts (OP REIT
           Interests) with an aggregate purchase price of $600.0 million and
           $2.0 million in cash;

        2. The Eagle Companies contributed a total of $633.3 million in cash or
           cash equivalents; and

        3. The Chandler Trusts contributed 9.3 million shares of the Company's
           Series A common stock, 6.2 million shares of the Company's Series C
           common stock, 381 thousand shares of the Company's Series C-1
           preferred stock and 245 thousand shares of the Company's Series C-2
           preferred stock (TMCT II Contributed Shares).

                                       37
<PAGE>   39
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     The Company's purchase of the OP REIT Interests was funded with the
proceeds of a $550.0 million short-term bank line of credit provided by Citicorp
and its commercial paper line. The Company refinanced this line of credit in
October 1999 (see Note 12). The cash contributed by the Company and the Eagle
Companies was used by TMCT II to purchase a portfolio of securities (TMCT II
Portfolio).

     The Company, the Eagle Companies and the Chandler Trusts share in the cash
flow of the various assets held by TMCT II. The cash flow from the OP REIT
Interests and the TMCT II Portfolio is largely allocated to the Chandler Trusts
with the remaining portion of the cash flow from the OP REIT Interests and the
TMCT II Portfolio primarily allocated to the Eagle Companies. The cash flow from
the TMCT II Contributed Shares is largely allocated to the Company with the
remaining portion of the cash flow from the TMCT II Contributed Shares primarily
allocated to the Chandler Trusts. Due to the allocations of the economic
benefits in TMCT II, for financial reporting purposes, 80% of the TMCT II
Contributed Shares are included in treasury stock, 80% of the preferred stock
dividends on the Series C-1 and C-2 preferred stock are excluded from preferred
stock dividends and 80% of the dividends on the common stock are effectively
eliminated. The Company and the Eagle Companies account for their investment in
the TMCT II OP REIT Interests and the TMCT II Portfolio under the equity method
and this net investment was $246.8 million at December 31, 1999. During 1999,
the Company and the Eagle Companies recognized $4.1 million of equity income
related to this investment.

     At December 31, 1999, the assets of TMCT II, excluding the TMCT II
Contributed Shares, consisted primarily of $600.0 million of OP REIT Interests,
$475.6 million of fixed income investments, $93.0 million of private equity
investments and $69.6 million of cash and cash equivalents. TMCT II may invest a
total of $560.0 million in venture capital or private equity investments. TMCT
II recognizes unrealized losses on its venture capital and private equity
investments and defers the recognition of unrealized gains on these investments
until realized. In the fourth quarter of 1999, the Company and Eagle New Media
Investments, LLC sold certain venture capital investments with a cost basis of
$16.2 million to TMCT II for proceeds of $31.4 million and has deferred
recognition of any gain until these investments are sold by TMCT II to third
parties unaffiliated with the Company. These proceeds are included in "Proceeds
from sales of investments and other assets" in the Consolidated Statements of
Cash Flows.

     In connection with the 1999 recapitalization, the Company replaced the
Series C-1 and C-2 preferred stocks with Series D-1 and D-2 preferred stocks
effective January 1, 2000. The Series D-1 and D-2 preferred stocks are identical
to the Series C-1 and C-2 preferred stocks except that the increases in the
dividend rate on the Series D-1 and D-2 preferred stocks are pursuant to a fixed
and certain schedule.

     As a result of the 1999 recapitalization, for financial reporting purposes,
the following number of shares have been included as treasury stock and excluded
from earnings per share calculations:

        1. 12.4 million shares of Series A and C common stocks;

        2. 305 thousand shares of Series C-1 preferred stock;

        3. 196 thousand shares of Series C-2 preferred stock.

NOTE 3 -- 1997 RECAPITALIZATION

     During the third quarter of 1997, the Company completed a transaction (1997
recapitalization) involving agreements with its largest shareholders, the
Chandler Trusts. The 1997 recapitalization consisted of two components: (a) the
merger of Chandis Securities Company (Chandis), a holding company owned by
Chandler Trust No. 2 and affiliated minority investors, into Chandis Acquisition
Corporation (CAC), a Delaware corporation and wholly-owned subsidiary of the
Company (Merger) and (b) the formation of a new limited liability company by the
Chandler Trusts and the Company.

                                       38
<PAGE>   40
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     On August 8, 1997, Chandis merged with and into CAC. Pursuant to the Merger
Agreement, the Chandis shareholders received 6.6 million shares of Series A
common stock, 9.7 million shares of Series C common stock, 381 thousand shares
of new Series C-1 preferred stock, and 245 thousand shares of new Series C-2
preferred stock. At the time of the Merger, Chandis owned 8.6 million shares of
Series A common stock, 9.7 million shares of Series C common stock, and 381
thousand shares of Series A preferred stock as well as an interest in
undeveloped real estate and certain other assets and liabilities. CAC is not a
"permitted transferee" as defined in the Company's Certificate of Incorporation,
therefore, the Series C common stock was converted to Series A common stock as a
result of the Merger. The Company's shares owned by CAC are reported as treasury
stock for financial reporting purposes. The Merger was a tax-free transaction.

     Concurrent with the consummation of the Merger, the Company (including
certain of its subsidiaries) and the Chandler Trusts formed TMCT, LLC (TMCT I),
a Delaware limited liability company, and the following capital contributions
were made to TMCT I:

        1. The Company contributed $249.3 million in cash and 8 real properties
           (Real Properties) with an aggregate market value of $225.9 million;

        2. The Chandler Trusts contributed 5.0 million shares of Series A common
           stock and 443 thousand shares of Series A preferred stock (TMCT I
           Contributed Shares).

     The cash contributed by the Company was used by TMCT I to purchase a
portfolio of securities (TMCT I Portfolio). The Company has leased the Real
Properties from TMCT I under a lease with minimum lease payments equal to the
fair values and with an initial term of 12 years. During 1999 and 1998, the
Company made annual lease payments to TMCT I of $24.2 million. The lease is
accounted for as a financing arrangement and, accordingly, the Real Properties'
book value remains on the Company's consolidated balance sheet and continues to
be depreciated at the rates in effect prior to the contribution of the Real
Properties to TMCT I. The depreciation, along with a reduction of property,
plant and equipment of $168.0 million, which represents the estimated net book
value of the Real Properties at the end of the lease term, will result in a net
book value of zero for the Real Properties at August 8, 2009. At that time, the
Company has the option to purchase all the Real Properties for their fair market
value. If the Real Properties are not purchased by the Company, they will remain
the assets of TMCT I and may be leased by the Company at a fair value rent as
provided for under the terms of the lease agreement. The lease provides for two
additional 12-year lease terms with fair value purchase options at the end of
each lease term. The lease is included as a property financing in the Company's
outstanding debt obligations (see Note 12).

     The Company and the Chandler Trusts share in the cash flow of the various
assets held by TMCT I. The cash flow from the Real Properties and the TMCT I
Portfolio is largely allocated to the Chandler Trusts and the cash flow from the
TMCT I Contributed Shares is largely allocated to the Company. Due to the
allocations of the economic benefits in the TMCT I, 80% of the TMCT I
Contributed Shares are included in treasury stock for financial reporting
purposes and 80% of the preferred stock dividends on the Series A preferred
stock are excluded from preferred stock dividends. The Company accounts for the
investment in the TMCT I Portfolio under the equity method. This net investment
was $86.0 million and $96.4 million at December 31, 1999 and 1998, respectively.
During 1999 and 1998, the Company recognized an equity loss of $3.5 million and
equity income of $3.7 million related to this investment, respectively. The
assets of TMCT I, excluding the TMCT I Contributed Shares, primarily consist of
Real Properties of $205.8 million and $214.0 million, fixed income investments
of $207.3 million and $213.2 million, and equity investments of $46.2 million
and $45.3 million at December 31, 1999 and 1998, respectively.

                                       39
<PAGE>   41
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     As a result of the 1997 recapitalization, for financial reporting purposes,
the following number of shares have been included as treasury stock and excluded
from earnings per share calculations:

        1. 6.0 million shares of Series A common stock;

        2. 735 thousand shares of Series A preferred stock.

NOTE 4 -- DISCONTINUED OPERATIONS

     In September 1999, Times Mirror announced its decision to sell
AchieveGlobal, Inc., a professional training company, Allen Communication, an
interactive software and training courseware developer, and The StayWell
Company, a health improvement information company. The Company decided to sell
these businesses in order to concentrate on its core strengths in newspaper
publishing, flight information and magazine publishing. While the Company
previously expected to complete the sale of AchieveGlobal in the first quarter
of 2000, the Company now believes that greater sales value can be realized by
allowing AchieveGlobal to fully implement certain of its strategic initiatives.
Currently, the Company anticipates selling AchieveGlobal by the end of 2000. The
accompanying financial statements reflect these businesses as discontinued
operations for all periods presented.

     During the second quarter of 1998, the Company reached agreements to divest
Matthew Bender & Company, Incorporated (Matthew Bender), the Company's legal
publisher, in a tax-free reorganization (see Note 5) and its 50% ownership
interest in legal citation provider Shepard's. The two transactions were valued
at $1.65 billion in the aggregate and were completed in the third quarter of
1998. The disposition of the Company's 50% interest in Shepard's was consummated
by a transfer of the respective partnership interests owned by two subsidiaries
of the Company to affiliates of Reed Elsevier plc for a cash consideration of
$274.7 million. The Company recorded a net gain on these two transactions in the
amount of $1.11 billion, net of expenses and $163.6 million of income taxes,
primarily consisting of tax reserves (see Note 11). Also during the second
quarter of 1998, the Company reached an agreement to divest Mosby, Inc. (Mosby),
the Company's health science/medical publisher, in a tax-free reorganization
(see Note 5). The transaction was valued at $415.0 million and was completed in
the fourth quarter of 1998. The Company recorded a net gain on this transaction
in the amount of $239.0 million, net of expenses and $55.6 million of income
taxes, primarily consisting of tax reserves (see Note 11). While the Company
believes that the Matthew Bender and Mosby transactions were completed on a
tax-free basis, this position may be subject to review by the Internal Revenue
Service. These divestitures represent the final dispositions of the Company's
professional and higher education publishing businesses and, as such, have been
reflected as discontinued operations in the accompanying financial statements
for all periods presented.

     During the third quarter of 1998, the Company decided to discontinue
Apartment Search, Inc., its apartment location business. In 1998, the Company
recorded an estimated loss on disposal including a provision for operating
losses of $3.4 million during the phase-out period. The total estimated loss of
$47.6 million, or $28.2 million after applicable tax benefit, is included in
discontinued operations in "Net gain on disposal, net of taxes" in the
Consolidated Statements of Income. The Company completed the sale of Apartment
Search, Inc. in March 1999.

                                       40
<PAGE>   42
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     A summary of the combined results of operations and net gain on disposal
for all discontinued entities are as follows (in thousands):

<TABLE>
<CAPTION>
                                                      1999         1998         1997
                                                    --------    ----------    --------
<S>                                                 <C>         <C>           <C>
Revenues..........................................  $186,578    $  507,475    $673,393
                                                    ========    ==========    ========
Income (loss) before income taxes(1)..............  $  2,271    $  (25,521)   $ 20,808
Income tax provision..............................     2,247         7,886       5,151
                                                    --------    ----------    --------
Income (loss) from discontinued operations........        24       (33,407)     15,657
Net gain on disposal, net of taxes(2).............        --     1,316,686          --
                                                    --------    ----------    --------
          Total discontinued operations...........  $     24    $1,283,279    $ 15,657
                                                    ========    ==========    ========
</TABLE>

---------------
(1) It is the Company's policy to allocate interest expense among business
    segments including discontinued operations. The allocation to discontinued
    operations is based on the ratio of net assets of discontinued operations
    plus consolidated debt, other than debt of the discontinued operations that
    will be assumed by the buyer and debt that can be directly attributed to the
    discontinued operations. Income (loss) before income taxes includes a charge
    for interest expense of $7.6 million, $18.1 million and $17.0 million for
    the years ended December 31, 1999, 1998 and 1997, respectively. The results
    of discontinued operations include pretax restructuring, one-time and other
    charges of $59.1 million and $12.8 million for the years ended December 31,
    1998 and 1997, respectively.

(2) Net of income taxes of $198.0 million in 1998.

     The assets and liabilities of discontinued operations have been classified
in the Consolidated Balance Sheets as net assets of discontinued operations and
consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                                  DECEMBER 31
                                                              --------------------
                                                                1999        1998
                                                              --------    --------
<S>                                                           <C>         <C>
Accounts receivable, net....................................  $ 33,373    $ 58,256
Other current assets........................................    27,289      49,310
Property, plant and equipment, net..........................    12,638      14,838
Goodwill, net...............................................    57,236      62,861
Other intangibles, net......................................    65,066      68,256
Other assets................................................    18,213      21,986
                                                              --------    --------
          Total assets......................................   213,815     275,507
                                                              --------    --------
Current liabilities.........................................    32,922      77,164
Non-current liabilities.....................................     7,803       8,715
                                                              --------    --------
          Total liabilities.................................    40,725      85,879
                                                              --------    --------
Net assets of discontinued operations.......................  $173,090    $189,628
                                                              ========    ========
</TABLE>

                                       41
<PAGE>   43
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     The major components of cash flow for discontinued operations are as
follows (in thousands):

<TABLE>
<CAPTION>
                                                      1999        1998        1997
                                                    --------    --------    ---------
<S>                                                 <C>         <C>         <C>
Income (loss) from discontinued operations........  $     24    $(33,407)   $  15,657
Depreciation and amortization.....................     9,620      25,572       31,319
Amortization of product costs.....................     4,796      16,550       22,655
Other, net........................................    17,055      64,191      (71,333)
                                                    --------    --------    ---------
  Net cash provided by (used in) discontinued
     operating activities.........................  $ 31,495    $ 72,906    $  (1,702)
                                                    ========    ========    =========

Capitalization of product costs...................  $ (5,994)   $(16,852)   $ (21,490)
Acquisitions, net of cash acquired................        --          --      (96,213)
Capital expenditures..............................    (4,256)    (11,485)     (16,836)
Other, net........................................        18      (1,360)     (18,796)
                                                    --------    --------    ---------
  Net cash used in investing activities of
     discontinued operations......................  $(10,232)   $(29,697)   $(153,335)
                                                    ========    ========    =========
</TABLE>

NOTE 5 -- REORGANIZATION

     During the third quarter of 1998, the Company completed the disposition of
Matthew Bender in a tax-free reorganization with Reed Elsevier plc. The
disposition of Matthew Bender was accomplished through the merger of an
affiliate of Reed Elsevier with and into Matthew Bender, with Matthew Bender as
the surviving corporation in the merger. As a result of the merger, TMD, Inc., a
wholly-owned subsidiary of Times Mirror, received all of the issued and
outstanding common stock of CBM Acquisition Parent Co. (MB Parent). MB Parent is
a holding company that owns controlling voting preferred stock of Matthew Bender
with a stated value of $61.6 million and participating preferred stock of
Matthew Bender. MB Parent is also the sole member of Eagle New Media
Investments, LLC (Eagle New Media). Affiliates of Reed Elsevier own voting
preferred stock of MB Parent with a stated value of $68.8 million which affords
them voting control over MB Parent, subject to certain rights held by Times
Mirror with respect to Eagle New Media. Concurrently, with the closing of the
merger, the Company became the sole manager of Eagle New Media and controls its
operations and assets. The consolidated financial statements of the Company
include the accounts of Eagle New Media.

     During the fourth quarter of 1998, the Company completed the disposition of
Mosby in a tax-free reorganization with Harcourt General, Inc. The disposition
of Mosby was accomplished through the merger of an affiliate of Harcourt
General, Inc. with and into Mosby, with Mosby as the surviving corporation in
the merger. As a result of the merger, the Company received all of the issued
and outstanding common stock of Mosby Parent Corp. (Mosby Parent). Mosby Parent
is a holding company that owns controlling voting preferred stock of Mosby with
a stated value of $48.3 million and participating preferred stock of Mosby.
Mosby Parent is also the sole member of Eagle Publishing Investments, LLC (Eagle
Publishing). An affiliate of Harcourt General, Inc. owns voting preferred stock
of Mosby Parent with a stated value of $50.0 million which affords it voting
control over Mosby Parent, subject to certain rights held by the Company with
respect to Eagle Publishing. Concurrently with the closing of the merger, the
Company became the sole manager of Eagle Publishing and controls its operations
and assets. The consolidated financial statements of the Company include the
accounts of Eagle Publishing.

     The Company intends to deploy the assets of both Eagle New Media and Eagle
Publishing to finance acquisitions and investments, including purchases of the
Company's common stock, and does not intend to use those funds for the Company's
general working capital purposes.

                                       42
<PAGE>   44
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 6 -- ACQUISITIONS, DISPOSITIONS AND WRITEDOWNS

     Acquisitions. In February 1999, Eagle New Media acquired Newport Media,
Inc., a publisher of shopper publications in the Long Island and New Jersey
areas, for approximately $132.0 million. This acquisition resulted in goodwill
of $68.5 million and other intangible assets of $90.8 million, which are being
amortized primarily over a period of 30 years. The Company also made other
acquisitions during 1999 for an aggregate consideration of $41.3 million. These
other acquisitions resulted in goodwill of $26.8 million and other intangible
assets of $15.2 million, which are being amortized over periods of 5 to 25
years.

     In April 1998, the Company acquired the Los Angeles area business of E Z
Buy & E Z Sell Recycler Corporation (Recycler), consisting primarily of the
Recycler publications in the Los Angeles, Orange, Riverside, San Bernardino and
Ventura counties and a portion of Santa Barbara county for $188.7 million. This
acquisition resulted in goodwill of $147.5 million and other intangible assets
of $69.4 million, which are being amortized primarily over 30 years. The Company
also invested in preferred stock and provided a term loan to Target Media
Partners, a new entity which owns all of the non-Los Angeles area assets of
Recycler, for a total amount of $34.8 million. The Company also made other
acquisitions during 1998 for an aggregate consideration of $12.1 million.
Goodwill of $13.8 million related to these other acquisitions is being amortized
primarily over 15 years.

     In 1997, the Company acquired Patuxent Publishing Company, a publisher of
13 community weeklies in Maryland and This Week Publications, Inc., a free
weekly shopper distributed in Queens and Long Island, New York. These and other
small acquisitions resulted in goodwill of $69.5 million, which is being
amortized over periods of 15 to 30 years.

     These acquisitions were accounted for by the purchase method with the
results of operations included in the Company's financial statements from the
dates of acquisition. Pro forma results for 1999, 1998 and 1997, assuming these
acquisitions occurred on January 1 of the respective year, are not materially
different from the results reported.

     Dispositions and Writedowns. In September 1999, the Company announced its
decision to sell the properties of The Sporting News, a sports magazine,
including its Web site sportingnews.com. The assets and liabilities of The
Sporting News have been classified as held for sale and are included in "Other
current assets" and "Other current liabilities" in the Consolidated Balance
Sheets. The assets of The Sporting News totaled $46.6 million at December 31,
1999 and consisted primarily of accounts receivable and deferred charges. The
liabilities of The Sporting News totaled $54.0 million at December 31, 1999 and
were comprised primarily of unearned income. During 1999, The Sporting News had
revenues of $37.2 million and an operating loss of $6.7 million.

     In May 1999, the Company completed an agreement to merge Hollywood Online,
Inc. and its Web site, hollywood.com, into Hollywood.com, Inc. (formerly Big
Entertainment, Inc.) in exchange for newly-issued restricted stock of
Hollywood.com, Inc. and a note with a then combined current value of
approximately $31.5 million. The Company recorded a gain of $17.2 million, or
$10.7 million after applicable income taxes, related to this disposition.

     During 1999, the Company sold 316 thousand shares of its holdings in AOL
common stock and purchased an equal proportion of its 4 1/4% Premium Equity
Participating Securities (PEPS) obligation in the open market. The PEPS hedge
the Company's investment in AOL (see Note 12). These transactions resulted in a
net gain of $16.9 million, or $10.0 million after applicable income taxes.
Additionally, the Company recorded gains on other non-operating items and
reduced the carrying value of certain new media and other investments. The total
net gains of $27.1 million are included in "Other, net" in the Consolidated
Statements of Income.

                                       43
<PAGE>   45
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     During 1998, the Company sold 442 thousand shares of its holdings in
Netscape Communications Corporation (Netscape) common stock (subsequently
purchased by AOL) and purchased an equal proportion of its PEPS obligation in
the open market. These transactions resulted in a net gain of $16.0 million, or
$9.5 million after applicable income taxes. The Company also disposed of various
excess real estate and other assets for an aggregate gain of $16.1 million, or
$9.6 million after applicable income taxes. The total gains of $32.1 million are
included in "Other, net" in the Consolidated Statements of Income.

     During 1997, the Company sold certain equity investments, including Tejon
Ranch Co., WebTV Network, Inc., Netscape, Speedvision Network, LLC and Outdoor
Life Network, LLC, for an aggregate gain of $75.6 million, or $47.7 million
after applicable income taxes. Additionally, the Company had writedowns and
expenses related to non-operating items as well as losses on the sale of Harry
N. Abrams, Inc., National Journal, Inc. and other assets of $39.3 million, or
$29.8 million after applicable income taxes. The total net gains of $36.3
million are included in "Other, net" in the Consolidated Statements of Income.

NOTE 7 -- RESTRUCTURING, ONE-TIME AND OTHER CHARGES

     In 1998, the Company undertook a comprehensive review of its business
operations to determine areas where operational efficiencies could be achieved
through either product and/or facility consolidation, headcount reductions,
product abandonments, contract terminations or other measures. The Company began
this review in anticipation of the impact of its significant 1998 divestitures
and to better align its overall cost structure and business configurations. The
Company's review led to a major restructuring program that resulted in the
recording of $155.7 million in 1998.

     A summary of the significant components of the 1998 restructuring program
is as follows (in thousands):

<TABLE>
<CAPTION>
                              NEWSPAPER     PROFESSIONAL     MAGAZINE     CORPORATE
                              PUBLISHING    INFORMATION     PUBLISHING    AND OTHER     TOTAL
                              ----------    ------------    ----------    ---------    --------
<S>                           <C>           <C>             <C>           <C>          <C>
Termination benefits........   $ 43,406        $2,021        $   156       $10,270     $ 55,853
Contract terminations.......     51,386            --          4,330            --       55,716
Goodwill impairments........        324            --         19,715            --       20,039
Lease termination costs.....      2,307         2,764          1,500         3,045        9,616
Technology asset
  write-offs................      4,772         1,378            100         1,504        7,754
Other costs.................        310         2,011          3,271         1,111        6,703
                               --------        ------        -------       -------     --------
                               $102,505        $8,174        $29,072       $15,930     $155,681
                               ========        ======        =======       =======     ========
</TABLE>

     A discussion of the specific restructuring activities follows:

     Termination Benefits. Staff reductions were implemented at substantially
all operating units with the majority of these actions performed within the
Newspaper Publishing segment. The Los Angeles Times recorded severance charges
related to 358 full-time and 534 part-time employees through either voluntary or
involuntary programs, primarily occurring in the fourth quarter of 1998. The
Baltimore Sun's termination charges included 81 full-time employees and Newsday
determined that 23 full-time and 26 part-time employees would be released. The
staff reductions within the Newspaper Publishing segment were the result of
identified efficiencies from outsourcing opportunities, elimination of duplicate
functions and technological improvements to the Company's processes. In total,
termination benefits, which were largely severance costs, covered 576 full-time
and 578 part-time employees company-wide of which 189 employees had been
released by the end of 1998 with the majority of employees released by the
second quarter of 1999. Termination benefits for these employees were
substantially paid by the end of 1999. However, certain employees will receive
payments over an extended period of time.

     Contract Terminations. In reviewing the Company's processes, supply
contracts and strategic alliances, the Company identified certain long-term
contracts and relationships which were no longer providing benefits

                                       44
<PAGE>   46
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

to the Company's current operations. As a result, the Company recorded charges
for contract terminations which included (i) the termination of a long-term
contract related to Newsday's pre-print distribution business for $34.3 million,
(ii) the termination of The Hartford Courant's long-standing bonus arrangement
for $12.0 million and (iii) the termination of 56 distribution contracts with
outside agents at the Los Angeles Times for $4.9 million.

     Goodwill Impairments. In accordance with SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of,"
impairment charges were taken related to goodwill associated with two of the
Company's magazine titles. These charges were taken as the result of
disappointing market penetration and operating results and were based on
discounted estimated cash flows from future operations.

     Lease Termination Costs. In connection with the Company's downsizing and/or
relocation of offices primarily at the Los Angeles Times and at Jeppesen's
German operation, the Company recorded charges for future operating lease
payments and write-offs of leasehold improvements related to facilities it will
vacate. The total lease payment accrual for periods through 2010 is net of
estimated sublease income of $3.4 million. No amounts have been included for any
period in which the operating units will continue to occupy the premises.

     Technology Asset Write-offs. During mid-1998, the Company determined that
its long standing policy of allowing each operating unit to independently
determine its technology requirements and make related equipment and software
purchases was both inefficient as well as expensive in terms of maintenance,
help desk, networking and other support costs. In connection with this decision,
the Company established common hardware and software configurations to provide
consistency across all business units. As a result, many operating units were
required to dispose of a significant amount of technology resources to conform
to the common platform. Total asset write-offs of technology-related equipment
were taken in the quarter in which the equipment was replaced.

     Other Costs. In performing a review of its businesses and product
offerings, expenses were recognized for the termination of an Internet venture
in the Magazine Publishing segment, in addition to costs for the abandonment of
certain projects at Jeppesen.

     Other Program Charges. In addition to the charges listed above, the Company
also recorded $18.7 million for certain asset write-offs that did not meet the
accounting criteria for classification as "restructuring and one-time charges."
These charges, which principally included other operating asset write-offs, have
been classified within "Selling, general and administrative expenses" in the
Consolidated Statements of Income.

                                       45
<PAGE>   47
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     A summary of the activity in the restructuring liabilities is as follows
(in thousands):

<TABLE>
<CAPTION>
                                                      1998             1995
                                                  RESTRUCTURING    RESTRUCTURING     TOTAL
                                                  -------------    -------------    --------
<S>                                               <C>              <C>              <C>
Balance at December 31, 1996....................    $     --         $ 58,819       $ 58,819
  Cash payments.................................          --          (24,483)       (24,483)
  Other(1)......................................          --            8,719          8,719
                                                    --------         --------       --------
Balance at December 31, 1997....................          --           43,055         43,055
  Charged to costs and expenses.................     155,681               --        155,681
  Cash payments.................................     (31,654)         (19,321)       (50,975)
  Asset write-offs..............................     (35,204)              --        (35,204)
  Other.........................................       1,176             (829)           347
                                                    --------         --------       --------
Balance at December 31, 1998....................      89,999           22,905        112,904
  Cash payments.................................     (63,236)         (10,992)       (74,228)
                                                    --------         --------       --------
Balance at December 31, 1999....................    $ 26,763         $ 11,913       $ 38,676
                                                    ========         ========       ========
</TABLE>

---------------
(1) Includes primarily transfers from discontinued operations for restructuring
    liabilities not assumed by purchasers of discontinued operations.

     The balance sheet classification of restructuring liabilities is as follows
(in thousands):

<TABLE>
<CAPTION>
                                                                    DECEMBER 31
                                                              ------------------------
                                                                  1999          1998
                                                              ------------    --------
<S>                                                           <C>             <C>
Restructuring -- current liabilities
  1995 Restructuring........................................    $ 7,555       $ 15,722
  1998 Restructuring........................................     18,240         76,181
Other liabilities
  1995 Restructuring........................................      4,358          7,183
  1998 Restructuring........................................      8,523         13,818
                                                                -------       --------
                                                                $38,676       $112,904
                                                                =======       ========
</TABLE>

     The current portion of restructuring liabilities relates primarily to
severance and lease payments while the non-current portion principally relates
to contract terminations and extended payout of severance arrangements, as well
as lease payments which will be paid over lease periods extending to 2010. The
Company made severance payments under all programs which totaled $37.8 million,
$7.5 million and $5.6 million during 1999, 1998 and 1997, respectively. At
December 31, 1999, the remaining liability for severance costs aggregated $15.1
million.

     The Company periodically assesses the adequacy of its remaining
restructuring liabilities and makes adjustments if required. During 1999 and
1998, these adjustments resulted in recoveries of prior year's restructuring
reserves which were largely offset by restructuring requirements in those years.
The net change in the restructuring liabilities as a result of these reviews has
not been significant.

                                       46
<PAGE>   48
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 8 -- SUPPLEMENTAL CASH FLOW INFORMATION

     Supplemental cash flow information is as follows (in thousands):

<TABLE>
<CAPTION>
                                                       1999       1998         1997
                                                     --------    -------    ----------
<S>                                                  <C>         <C>        <C>
Interest paid......................................  $ 65,383    $68,571    $   33,545
Income taxes paid..................................   104,630     47,406       138,567
Liabilities assumed in connection with
  acquisitions.....................................    53,793      9,910        17,194
Stock and notes receivable received from
  divestiture......................................    31,503         --            --
Merger with Chandis:
  Times Mirror stock received......................        --         --     1,116,058
  Other assets received............................        --         --        21,050
  Times Mirror stock issued........................        --         --     1,137,108
Fair value of properties contributed to TMCT I.....        --         --       225,850
Property financing obligation, net of original issue discount...       --      --     57,829
Notes issued in connection with an acquisition.....        --         --        39,209
</TABLE>

NOTE 9 -- FINANCIAL INSTRUMENTS

     Financial instruments consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                             DECEMBER 31
                                          -------------------------------------------------
                                                   1999                      1998
                                          -----------------------   -----------------------
                                           CARRYING       FAIR       CARRYING       FAIR
                                            VALUE        VALUE        VALUE        VALUE
                                          ----------   ----------   ----------   ----------
<S>                                       <C>          <C>          <C>          <C>
Short-term assets.......................  $  507,680   $  507,680   $1,414,350   $1,414,350
Long-term investments...................     185,299      185,299      129,364      129,364
Notes receivable........................      91,056       91,056       74,082       74,082
Short-term liabilities..................     434,295      434,295      492,025      492,025
Long-term debt..........................   1,562,240    1,711,004      941,423    1,017,245
Unrealized net gain on interest rate
  swaps.................................          --       12,959           --       43,246
</TABLE>

     Short-Term Assets and Liabilities. The fair values of cash and cash
equivalents, marketable securities, accounts receivable, accounts payable and
short-term debt approximate their carrying values due to the short-term nature
of these financial instruments.

     Long-Term Investments. Investments in publicly traded securities are
classified as available-for-sale and are stated at fair value based on quoted
market prices. All other investments are recorded at the lower of cost or
estimated net realizable value. The cost of the investments was $81.1 million
and $42.2 million at December 31, 1999 and 1998, respectively. Unrealized gains
are included in "Accumulated other comprehensive income" (see Note 18).

     Notes Receivable. The carrying value of notes receivable is estimated to
approximate fair values. Although there are no quoted market prices available
for these instruments, the fair value estimates were based on the changes in
interest rates and risk related interest rate spreads since the notes
origination dates.

     Long-Term Debt. The fair value of long-term debt is based primarily on the
Company's current refinancing rates for publicly issued fixed rate debt with
comparable maturities, except for the PEPS whose fair value is based on the open
market (see Note 12).

     Interest Rate Swaps. Interest rate swap agreements outstanding at December
31, 1999 were for notional amounts of $200.0 million, $170.1 million and $100.0
million expiring in 2001, 2002 and 2023, respectively, with $170.1 million and
$100.0 million notional amounts also outstanding at December 31, 1998. In 1999,
two

                                       47
<PAGE>   49
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

swaps which were outstanding as of December 31, 1998 with notional amounts of
$148.0 million and $250.0 million expired during the year. The Company's swaps
effectively convert a portion of the long-term fixed rate debt to a variable
rate obligation based on LIBOR or the Commercial Paper rate. The fair values of
the interest rate swaps are the amounts at which they could be settled based on
estimates of market rates.

     Commodity Price Hedging Contracts. The Company enters into various
commodity hedging contracts to manage the Company's exposure to fluctuations in
newsprint prices. As of December 31, 1999, the Company had newsprint swap
agreements for a total notional amount of 261 thousand metric tons per year
expiring in 2001, 2002 and 2003 at a weighted average contract price of $609 per
metric ton. Also, the Company has a newsprint option contract for a total
notional amount of 30 thousand metric tons per year expiring in 2001 at a
contract price of $585 per metric ton. This option contract limits the maximum
payment to $115 per metric ton above the contract price on an annual basis. At
December 31, 1999, the index rate used for these contracts was $515 per metric
ton. In addition to the newsprint hedging contracts, the Company has a swap
contract for coated paper used in its Magazine Publishing operations for a total
notional amount of 5 thousand short tons per year expiring in 2000 at a contract
price of $1,047 per short ton. As no liquid forward market for newsprint or
coated paper exists, it was not practicable to estimate the fair value of the
commodity hedging contracts.

NOTE 10 -- INVENTORIES

     Inventories consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                                 DECEMBER 31
                                                              ------------------
                                                               1999       1998
                                                              -------    -------
<S>                                                           <C>        <C>
Newsprint, paper and other raw materials....................  $28,125    $23,404
Finished products...........................................    5,894      4,051
Work-in-progress............................................    1,063        983
                                                              -------    -------
                                                              $35,082    $28,438
                                                              =======    =======
</TABLE>

     Inventories determined by the last-in, first-out method were $18.1 million
and $13.7 million at December 31, 1999 and 1998, respectively, and would have
been higher by $15.6 million in 1999 and $16.1 million in 1998 had the first-in,
first-out method (which approximates current cost) been used.

NOTE 11 -- INCOME TAXES

     Income tax expense from continuing operations consists of the following (in
thousands):

<TABLE>
<CAPTION>
                                                       1999        1998        1997
                                                     --------    --------    --------
<S>                                                  <C>         <C>         <C>
Current:
  Federal..........................................  $ 89,117    $ 77,412    $ 94,422
  State............................................    33,499       9,515      13,099
  Foreign..........................................    12,849      12,601      12,736
Deferred:
  Federal..........................................    42,764        (716)     29,898
  State............................................     2,000      12,133      11,689
                                                     --------    --------    --------
                                                     $180,229    $110,945    $161,844
                                                     ========    ========    ========
</TABLE>

                                       48
<PAGE>   50
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     The difference between actual income tax expense and the U.S. Federal
statutory income tax expense for continuing operations is reconciled as follows
(in thousands):

<TABLE>
<CAPTION>
                                                       1999        1998        1997
                                                     --------    --------    --------
<S>                                                  <C>         <C>         <C>
Income from continuing operations before income
  taxes:
  United States....................................  $409,028    $220,235    $369,596
  Foreign..........................................    30,263      24,769      26,903
                                                     --------    --------    --------
                                                     $439,291    $245,004    $396,499
                                                     ========    ========    ========
Federal statutory income tax rate..................        35%         35%         35%
Federal statutory income tax expense...............  $153,752    $ 85,751    $138,775
Increase (decrease) in income taxes resulting from:
  State and local income tax expense, net of
     Federal effect................................    23,074      14,071      16,112
  Goodwill amortization not deductible for tax
     purposes......................................     6,007       5,979       4,424
  Foreign tax differentials........................     1,327      (1,474)      1,439
  Basis difference in asset sales..................      (420)     (2,193)      5,249
  Writedown of assets..............................        --       6,900          --
  Other............................................    (3,511)      1,911      (4,155)
                                                     --------    --------    --------
                                                     $180,229    $110,945    $161,844
                                                     ========    ========    ========
</TABLE>

     The tax effect of temporary differences results in deferred income tax
assets (liabilities) and balance sheet classifications as follows (in
thousands):

<TABLE>
<CAPTION>
                                                                   DECEMBER 31
                                                              ----------------------
                                                                1999         1998
                                                              ---------    ---------
<S>                                                           <C>          <C>
TEMPORARY DIFFERENCES

Postretirement benefits.....................................  $  84,656    $  86,534
Other employee benefits.....................................     65,873       54,872
State and local income taxes................................     26,484       25,801
Restructuring and one-time charges..........................      9,035       26,374
Valuation and other reserves................................      5,657        6,092
Other deferred tax assets...................................      9,781        5,782
                                                              ---------    ---------
     Total deferred tax assets..............................    201,486      205,455
                                                              ---------    ---------
Transaction tax reserve.....................................   (176,585)    (176,585)
Retirement and health benefits..............................   (176,505)    (153,572)
Depreciation and other property, plant and equipment
  differences...............................................   (146,546)    (158,950)
Intangible asset differences................................    (73,313)      (2,378)
Unrealized investment gains.................................    (25,946)     (33,055)
Other deferred tax liabilities..............................    (51,339)     (22,259)
                                                              ---------    ---------
     Total deferred tax liabilities.........................   (650,234)    (546,799)
                                                              ---------    ---------
                                                              $(448,748)   $(341,344)
                                                              =========    =========
BALANCE SHEET CLASSIFICATIONS

Current deferred tax assets.................................  $  33,314    $  32,279
Noncurrent deferred tax liabilities.........................   (482,062)    (373,623)
                                                              ---------    ---------
                                                              $(448,748)   $(341,344)
                                                              =========    =========
</TABLE>

     In connection with the dispositions of Matthew Bender and Mosby as
discussed in Notes 4 and 5, the Company has recorded a tax reserve of $176.6
million. While the Company believes that these transactions

                                       49
<PAGE>   51
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

were completed on a tax-free basis, this position may be subject to review by
the Internal Revenue Service. The results of such a review are unpredictable and
could result in a tax liability that is significantly higher or lower than that
which has been provided by the Company.

NOTE 12 -- DEBT

     Debt consists of the following (dollars in thousands):

<TABLE>
<CAPTION>
                                                                   DECEMBER 31
                                                              ----------------------
                                                                 1999         1998
                                                              ----------    --------
<S>                                                           <C>           <C>
Short-term debt:
  Commercial paper at weighted average interest rates of
     5.9% and 5.3%..........................................  $  241,381    $298,603
  Current maturities of long-term debt......................       7,149       7,440
  Other notes payable at interest rates of 6.4% and 5.4%....       6,304       6,567
                                                              ----------    --------
     Total short-term debt..................................  $  254,834    $312,610
                                                              ==========    ========
Long-term debt:
  7.45% Notes due October 15, 2009, net of unamortized
     discount of $513.......................................  $  399,487    $     --
  6.61% Debentures due September 15, 2027, net of
     unamortized discount of $95 and $98....................     249,905     249,902
  4.75% Liquid Yield Option Notes due April 15, 2017, net of
     unamortized discount of $277,946 and $288,129..........     222,054     211,871
  6.65% Notes due October 15, 2001, net of unamortized
     discount of $123.......................................     199,877          --
  7 1/4% Debentures due March 1, 2013.......................     148,215     148,215
  7 1/4% Debentures due November 15, 2096, net of
     unamortized discount of $553 and $559..................     147,447     147,441
  7 1/2% Debentures due July 1, 2023........................      98,750      98,750
  4 1/4% PEPS due March 15, 2001; 512,050 and 863,100
     securities stated at fair value........................      64,006      45,596
  Property financing obligation expiring on August 8, 2009,
     net of unamortized discount of $149,932 and $158,080,
     with an effective interest rate of 4.3%................      39,648      47,088
                                                              ----------    --------
                                                               1,569,389     948,863
Less current maturities.....................................      (7,149)     (7,440)
                                                              ----------    --------
     Total long-term debt...................................  $1,562,240    $941,423
                                                              ==========    ========
</TABLE>

     Interest rate swaps converted the weighted average interest rate on the
6.61% Debentures, the Liquid Yield Option Notes (LYONs(TM)), the 6.65% Notes,
the 7 1/4% Debentures due 2096, and the 7 1/2% Debentures from 6.4% to 6.0% for
the year ended December 31, 1999.

     In connection with the 1999 recapitalization, the Company issued $200.0
million of 6.65% two-year notes maturing on October 15, 2001 and $400.0 million
of 7.45% ten-year notes maturing on October 15, 2009. The Company also entered
into a two-year interest rate swap agreement for a notional amount of $200.0
million expiring in October 2001. The swap agreement effectively converts the
Company's $200.0 million fixed rate debt at 6.65% to a variable rate obligation
based on LIBOR.

     In September 1997, the Company issued $250.0 million of 6.61% Debentures
due September 15, 2027 (Debentures) with interest payable semiannually
commencing March 15, 1998. The Debentures are redeemable at the option of the
Company, in whole or in part, at any time after September 15, 2004 at a

                                       50
<PAGE>   52
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

redemption price equal to the greater of (a) 100% of the principal amount or (b)
the sum of the present values of the remaining scheduled payments of principal
and interest discounted to the redemption date. The Debentures may be put to the
Company on September 15, 2004 at 100% of face value plus accrued interest.

     In April 1997, the Company received gross proceeds of $195.5 million from
the issuance of the LYONs. The LYONs are zero coupon subordinated notes with an
aggregate face value of $500.0 million and a yield to maturity of 4.75%. Each
LYON has a $1,000 face value and is convertible at the option of the holder any
time prior to maturity. If conversion is elected, the Company will, at its
option, deliver (a) 5.828 shares of Series A common stock per each LYON or (b)
cash equal to the market value of such shares. On or after April 15, 2002, the
LYONs may be redeemed at any time by the Company for cash equal to the issuance
price plus accrued original discount through the date of redemption. In
addition, each LYON may be redeemed for cash at the option of the holder on
April 15, 2002, 2007 or 2012. The cash payable for each LYON at these redemption
dates is approximately $495, $625 and $791, respectively, which is equal to the
issuance price plus accrued original discount through the date of redemption.
The Company has an interest rate swap agreement for a notional amount of $170.1
million, expiring April 15, 2002, to exchange a fixed interest rate of 4.75% for
a variable rate based on six-month LIBOR less 2.458%.

     The 4 1/4% PEPS hedge the Company's investment in the common stock of AOL.
The amount payable at maturity with respect to each PEPS will equal 1.8 times
the average market price of one share of AOL common stock for the ten trading
days ending on the second business day prior to the maturity date, subject to
adjustment as a result of certain dilution events involving AOL. Holders of the
PEPS bear the full risk of a decline in the value of AOL. The Company is not
obligated to hold the AOL stock for any period or sell the AOL stock prior to
the PEPS maturity or redemption date.

     The PEPS are redeemable at the option of the Company, in whole or in part,
at any time after December 15, 2000. The redemption value of each PEPS is the
product of (a) the redemption ratio, as defined below, (b) 1.8 and (c) the
average market price of one share of AOL common stock for the ten trading days
ending on the second business day prior to the redemption date, plus cash in an
amount equal to all unpaid interest, whether or not accrued, that would have
been payable on the PEPS through the maturity date. The redemption ratio will
equal (a) 1.0, if the market value of one share of AOL common stock is less than
$21.81, or (b) a fraction, the numerator of which is $21.81 and the denominator
of which is the market value of AOL common stock, if such market value is equal
to or exceeds $21.81 but less than or equal to $25.08, or (c) .8696, if the
market value of AOL common stock exceeds $25.08.

     The PEPS are recorded at fair market value as determined in the open market
and will generally move in tandem with changes in the fair market value of AOL
common stock. The net unrealized loss on the PEPS at December 31, 1999 and 1998
is $26.0 million and $6.9 million, respectively, net of applicable income taxes,
and is included in "Accumulated other comprehensive income." During 1999, the
Company sold 316 thousand shares of AOL stock and purchased a proportionate
share of its PEPS in the open market (see Note 6).

     The Company has an agreement with several domestic and foreign banks for
unsecured long-term revolving lines of credit that expire in April 2002. This
agreement provides for borrowings up to $400.0 million at interest rates based
on, at the Company's option, the banks' base rates, Eurodollar rates or
competitive bid rates. The commitment fee is approximately 0.065% per annum. The
lines of credit are used to support a commercial paper program. The Company's
revolving lines of credit contain restrictive provisions relating primarily to
interest expense coverage. The Company's earnings before interest expense,
income taxes, depreciation and amortization, divided by interest expense, must
be greater than or equal to 5.0.

     The Company has $5.9 million of undrawn standby letters of credit at
December 31, 1999.

                                       51
<PAGE>   53
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     At December 31, 1999, the aggregate principal maturities of the Company's
debt are as follows (in thousands):

<TABLE>
<S>                                                        <C>
2000.....................................................  $    7,149
2001.....................................................     270,654
2002.....................................................       6,292
2003.....................................................       5,699
2004.....................................................       4,975
Thereafter...............................................   1,274,620
                                                           ----------
                                                           $1,569,389
                                                           ==========
</TABLE>

NOTE 13 -- CAPITAL STOCK AND STOCK PURCHASE PROGRAM

     Preferred Stocks. Series A, Series C-1 and Series C-2 preferred stocks are
cumulative, non-voting stocks with annual dividends of 8%, 5.8% and 5.8%,
respectively, based on liquidation value. Series A preferred stock was entitled
to dividends effective March 1, 1995. In connection with the 1999
recapitalization, the Company replaced the Series C-1 and C-2 preferred stocks
with Series D-1 and D-2 preferred stocks effective January 1, 2000. Dividends on
Series D-1 and Series D-2 preferred stocks will increase pursuant to a fixed and
certain schedule. Series A, Series D-1 and Series D-2 preferred stocks are
convertible into Series A common stock in 2025 at the earliest. The conversion
factor is calculated by dividing $500 plus accrued and unpaid dividends by the
average closing prices of Series A common stock for the 20 trading days
immediately preceding the conversion date. The maximum number of shares of
Series A common stock into which Series D-2 preferred stock can be converted is
limited to 3.0 million shares.

     On February 28, 1997, the Series B preferred stock was called for
redemption and was redeemed on April 2, 1997 for 4.4 million shares of Series A
common stock. The conversion ratio, determined pursuant to the original terms of
the Series B preferred stock, was .57083 of a share of Series A common stock. At
the redemption date, the Company had forward purchase contracts for 3.9 million
shares of Series B preferred stock with a weighted average forward price of
$28.475 per share. These contracts provided for early termination and, in May
1997, the termination of the contract resulted in the purchase by the Company of
2.2 million shares of Series A common stock for an aggregate cost of $111.5
million.

     Preferred stock is issuable in series under such terms and conditions as
the Board of Directors may determine.

     Common Stocks. Shares of Series A and Series C common stock are identical,
except with respect to voting rights, restrictions on transfer of Series C
common shares and the right to convert Series C common shares into Series A
common shares. Series A common shares are entitled to one vote per share and
Series C common shares are entitled to ten votes per share. Series C common
shares are subject to mandatory conversion into Series A common shares upon
transfer to any person other than a "Permitted Transferee" as defined in the
Company's Certificate of Incorporation or upon the occurrence of certain
regulatory events. Series B common stock is entitled to one-tenth vote per share
and is available for common stock issuance transactions, such as underwritten
public offerings and acquisitions.

     Cash dividends of $.80 and $.72 per share of common stock were declared for
the years ended December 31, 1999 and 1998, respectively. In February 2000, the
Board of Directors approved an increase in the quarterly dividend on its common
stock to $.22 per share, from $.20 per share, beginning with the March 10, 2000
payment date.

     Treasury Stock. Treasury stock includes shares of Series A common stock and
Series A, Series C-1 and Series C-2 preferred stock owned by affiliates as well
as Series A common stock purchased by the Company as part of the stock purchase
program. At December 31, 1999, 15.2 million, 4.0 million, 18.2 million and

                                       52
<PAGE>   54
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

12.4 million shares of Series A common stock included in treasury stock are
owned by Eagle New Media, TMCT I, CAC and TMCT II, respectively. Also, 354
thousand and 381 thousand shares of Series A preferred stock, which are owned by
TMCT I and CAC, respectively, and 305 thousand and 196 thousand shares of Series
C-1 and C-2 preferred stock, respectively, which are owned by TMCT II, are
included in treasury stock at December 31, 1999.

     At December 31, 1998, 13.3 million, 4.0 million and 18.2 million shares of
Series A common stock included in treasury stock are owned by Eagle New Media,
TMCT I and CAC, respectively, and 354 thousand and 381 thousand shares of Series
A preferred stock, which are owned by TMCT I and CAC, respectively, are included
in treasury stock.

     Stock Purchases. During 1999, the Company and Eagle New Media purchased 2.9
million common shares for a total cost of $196.5 million. An additional 325
thousand common shares were purchased for $15.5 million, net of premiums
received, as a result of the exercise of put options. At December 31, 1999, the
Company had 400 thousand put options outstanding with a weighted average strike
price of $68.23 per common share. The cash received from the issuance of put
options during 1999 and 1998 was not significant. The put options entitle the
holder to sell shares of Times Mirror Series A common stock to the Company at
the strike price on the expiration date of the put option. The unexpired put
options are at strike prices ranging from $67.09 to $69.69. These put options
expire on various dates through March 2000.

     During 1998, the Company and Eagle New Media purchased 16.4 million common
shares for a total cost of $947.2 million. An additional 350 thousand common
shares were purchased for $17.5 million, net of premiums received, as a result
of the exercise of put options. Included in the 1998 share purchases were 4.0
million shares that were purchased in the fourth quarter of 1998 as part of an
accelerated purchase agreement. The shares were purchased at the closing price
on the date of the agreement for $54.69 per share. The agreement provides for a
purchase price adjustment based on a pro-rata settlement over a one-year period
and was settled in December 1999.

     During 1997, the Company purchased 8.9 million shares of Series A common
stock for a total cost of $464.8 million. An additional 120 thousand shares of
Series A common stock were purchased for $3.7 million, net of premiums received,
as a result of the exercise of put options.

     The aggregate remaining shares authorized for purchase at December 31, 1999
was approximately 3.9 million shares. The Company believes that the purchase of
shares of its common stock is an attractive investment for Eagle New Media which
will also enhance Times Mirror shareholder value as well as offset dilution from
shares of common stock issued under the Company's stock-based employee
compensation and benefit programs.

NOTE 14 -- STOCK OPTION AND AWARD PLANS

     The Company has various stock option plans under which options may be
granted to purchase shares of Series A common stock at a price equal to the fair
market value at the date of grant. Options that are not exercised expire ten
years from the date of grant. Options granted to key employees generally vest
over a four-year period. Grants made under a broad-based stock option plan, for
employees not eligible for other stock option grants, are fully vested three
years after the date of grant. Restricted stock is also awarded to key
employees. The number of restricted stock awards, including matching awards in
connection with the annual incentive bonus program, is not material.

                                       53
<PAGE>   55
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     Options granted, exercised and forfeited were as follows:

<TABLE>
<CAPTION>
                                                                            WEIGHTED
                                                                NUMBER      AVERAGE
                                                                  OF        EXERCISE
                                                                SHARES       PRICE
                                                              ----------    --------
<S>                                                           <C>           <C>
Options outstanding December 31, 1996.......................   7,771,489     $26.12
  Granted...................................................   4,686,643      47.85
  Exercised.................................................  (1,617,045)     22.47
  Forfeited.................................................    (571,732)     34.03
                                                              ----------     ------
Options outstanding December 31, 1997.......................  10,269,355      36.17
  Granted...................................................   4,370,240      59.58
  Exercised.................................................  (2,145,260)     27.58
  Forfeited.................................................  (1,084,989)     50.00
                                                              ----------     ------
Options outstanding December 31, 1998.......................  11,409,346      45.44
  Granted...................................................   4,739,378      55.46
  Exercised.................................................  (1,964,992)     34.08
  Forfeited.................................................  (1,520,628)     50.76
                                                              ----------     ------
Options outstanding December 31, 1999.......................  12,663,104     $50.31
                                                              ==========     ======
</TABLE>

     Information regarding stock options outstanding and exercisable as of
December 31, 1999 is as follows:

<TABLE>
<CAPTION>
                                                        PRICE RANGE
                               -------------------------------------------------------------
                                $11.43       $18.06       $30.06       $46.56       $58.03
                               TO $17.29    TO $23.94    TO $44.94    TO $57.94    TO $69.13
                               ---------    ---------    ---------    ---------    ---------
<S>                            <C>          <C>          <C>          <C>          <C>
Options outstanding:
  Number.....................    37,510      687,081     1,354,985    6,686,343    3,897,185
  Weighted average exercise
     price...................    $16.63       $18.51        $34.35       $52.11       $58.71
  Weighted average remaining
     contractual life........   2 years      4 years       6 years      8 years      8 years
Options exercisable:
  Number.....................    37,510      687,081     1,307,569      986,416      613,425
  Weighted average exercise
     price...................    $16.63       $18.51        $34.11       $48.11       $58.52
</TABLE>

     At December 31, 1999 and 1998 shares reserved for future grants and awards
were 6.4 million and 9.7 million, respectively.

     If the Company recognized employee stock option-related compensation
expense in accordance with SFAS 123 and used the Black-Scholes option valuation
model for determining the weighted average fair value of options granted after
December 31, 1994, its net income and earnings per share would have been as
follows (in thousands, except per share amounts):

<TABLE>
<CAPTION>
                                                      1999         1998         1997
                                                    --------    ----------    --------
<S>                                                 <C>         <C>           <C>
Net income -- as reported.........................  $259,086    $1,417,338    $250,312
Pro forma stock compensation expense, net.........   (23,207)      (18,709)    (13,000)
                                                    --------    ----------    --------
Pro forma net income..............................  $235,879    $1,398,629    $237,312
                                                    ========    ==========    ========
Pro forma basic earnings per share................  $   3.19    $    16.23    $   2.21
                                                    ========    ==========    ========
Pro forma diluted earnings per share..............  $   3.07    $    15.89    $   2.16
                                                    ========    ==========    ========
</TABLE>

                                       54
<PAGE>   56
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     For purposes of the pro forma expense, the weighted average fair value of
the options is amortized over the vesting period. The pro forma effect on net
income through 1998 may not be representative of future years' impact because
options granted prior to 1995 are excluded from the pro forma calculations.
Options are granted every year and the pro forma expense in future years will
grow due to the added layers of amortization for succeeding grants. In 1999,
however, the pro forma results include a full four years' worth of option
grants.

     The weighted average fair value of stock options on the date of grant, and
the assumptions used to estimate the fair value using the Black-Scholes option
valuation model, were as follows:

<TABLE>
<CAPTION>
                                                           1999       1998       1997
                                                          -------    -------    -------
<S>                                                       <C>        <C>        <C>
Weighted average fair value of stock options granted....  $ 13.14    $ 12.78    $ 11.90
Risk-free interest rate.................................      5.2%       5.5%       6.2%
Expected life...........................................  5 years    5 years    5 years
Expected volatility.....................................      .23        .20        .22
Expected dividend yield.................................     2.33%      2.33%      2.33%
</TABLE>

     The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options. The Company's employee stock
options have characteristics significantly different from those of traded
options such as vesting restrictions and lack of transferability. In addition,
the assumptions used in option valuation models are highly subjective,
particularly with respect to the expected stock price volatility for the
underlying stock. Because changes in these subjective input assumptions can
materially affect the fair value estimate, in management's opinion, the existing
models do not provide a reliable single measure of the fair value of its
employee stock options.

NOTE 15 -- PENSION PLANS AND POSTRETIREMENT BENEFITS

     The Company has defined benefit pension plans and various other
contributory and noncontributory retirement plans covering substantially all
employees. In general, benefits under the defined benefit plans are based on
years of service and the employee's compensation during the last five years of
employment. The majority of the Company's employees are covered by one defined
benefit plan. Funding for this plan is not expected to be required in the near
future as the plan is overfunded.

     Postretirement health care benefits provided by the Company are unfunded
and cover certain employees hired before January 1, 1993. The various plans have
significantly different provisions for lifetime maximums, retiree cost-sharing,
health care providers, prescription drug coverage and other benefits.
Postretirement life insurance benefits are generally insured by life insurance
policies and cover employees who retired on or before December 31, 1993. Life
insurance benefits vary by plan, ranging from $1,000 to $250,000. Certain
employees become eligible for the postretirement health care benefits if they
meet minimum age and service requirements and retire from full-time, active
service.

                                       55
<PAGE>   57
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     The following information regarding pension and postretirement benefit
plans includes discontinued operations. Changes in benefit obligations and in
plan assets and the funded status of the plans are as follows (in thousands):

<TABLE>
<CAPTION>
                                             PENSION PLANS        POSTRETIREMENT BENEFITS
                                        -----------------------   -----------------------
                                           1999         1998         1999         1998
                                        ----------   ----------   ----------   ----------
<S>                                     <C>          <C>          <C>          <C>
CHANGE IN BENEFIT OBLIGATIONS
Benefit obligations at January 1......  $  787,091   $  662,385   $ 141,678    $ 132,601
Service cost..........................      40,683       37,377       3,331        3,052
Interest cost.........................      52,610       49,367       7,623        7,909
Plan amendments.......................          --        2,813          --           --
Participant contributions.............          --           --       2,042        2,073
Actuarial losses (gains)(1)...........     (57,128)      86,647     (18,672)       4,996
Curtailment gains.....................          --       (8,898)         --         (327)
Dispositions..........................      (7,000)          --          --           --
Special termination benefits..........          --           --         365           --
Benefits paid.........................     (47,500)     (42,600)     (8,453)      (8,626)
                                        ----------   ----------   ---------    ---------
Benefit obligations at December 31....  $  768,756   $  787,091   $ 127,914    $ 141,678
                                        ==========   ==========   =========    =========
CHANGE IN PLAN ASSETS
Fair value of plan assets at January
  1...................................  $1,146,168   $1,080,160   $      --    $      --
Actual return on plan assets..........     277,703      102,355          --           --
Acquisitions..........................       1,509        3,310          --           --
Dispositions..........................      (7,000)          --          --           --
Company contributions.................       2,630        2,943       6,411        6,553
Participant contributions.............          --           --       2,042        2,073
Benefits paid.........................     (47,500)     (42,600)     (8,453)      (8,626)
                                        ----------   ----------   ---------    ---------
Fair value of plan assets at December
  31..................................  $1,373,510   $1,146,168   $      --    $      --
                                        ==========   ==========   =========    =========
FUNDED STATUS
Funded status (underfunded) at
  December 31.........................  $  604,754   $  359,077   $(127,914)   $(141,678)
Unrecognized net actuarial losses
  (gains)(2)..........................    (185,134)      40,896     (50,739)     (34,984)
Unrecognized prior service cost.......      (4,886)      (4,309)    (42,458)     (49,356)
Unrecognized net transition asset.....        (869)      (3,656)         --           --
                                        ----------   ----------   ---------    ---------
Net amount recognized.................  $  413,865   $  392,008   $(221,111)   $(226,018)
                                        ==========   ==========   =========    =========
</TABLE>

---------------
(1) The actuarial gains relate primarily to changes in the assumed discount
    rate.

(2) The unrecognized net actuarial gains relate primarily to the higher actual
    return on plan assets than was assumed and changes in the assumed discount
    rate.

     Amounts applicable to the Company's pension plans with accumulated benefit
obligations in excess of plan assets are (in thousands):

<TABLE>
<CAPTION>
                                                                 DECEMBER 31
                                                              ------------------
                                                               1999       1998
                                                              -------    -------
<S>                                                           <C>        <C>
Projected benefit obligations...............................  $62,353    $61,044
Accumulated benefit obligations.............................   56,138     51,134
Fair value of plan assets...................................   13,420     13,348
</TABLE>

                                       56
<PAGE>   58
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     The following sets forth the amounts recognized in the Consolidated Balance
Sheets (in thousands):

<TABLE>
<CAPTION>
                                           PENSION PLANS        POSTRETIREMENT BENEFITS
                                        --------------------    ------------------------
                                            DECEMBER 31               DECEMBER 31
                                        --------------------    ------------------------
                                          1999        1998         1999          1998
                                        --------    --------    ----------    ----------
<S>                                     <C>         <C>         <C>           <C>
Prepaid pension cost..................  $445,175    $419,471    $      --     $      --
Accrued benefit liability.............   (45,941)    (40,319)    (221,111)     (226,018)
Intangible asset......................     4,593       5,545           --            --
Deferred income taxes.................     3,950       2,915           --            --
Accumulated other comprehensive
  income..............................     6,088       4,396           --            --
                                        --------    --------    ---------     ---------
Net amount recognized.................  $413,865    $392,008    $(221,111)    $(226,018)
                                        ========    ========    =========     =========
</TABLE>

     Net periodic benefit cost (income) is as follows (in thousands):

<TABLE>
<CAPTION>
                                        PENSION PLANS               POSTRETIREMENT BENEFITS
                               --------------------------------   ---------------------------
                                 1999        1998        1997      1999      1998      1997
                               ---------   ---------   --------   -------   -------   -------
<S>                            <C>         <C>         <C>        <C>       <C>       <C>
Service cost.................  $  40,683   $  37,377   $ 33,164   $ 3,331   $ 3,052   $ 2,732
Interest cost................     52,610      49,367     47,287     7,623     7,909     8,204
Expected return on plan
  assets.....................   (110,815)   (103,857)   (93,753)       --        --        --
Amortization of transition
  asset......................     (2,787)    (21,560)   (21,560)       --        --        --
Amortization of prior service
  cost.......................        577         620        (44)   (6,898)   (6,992)   (6,992)
Recognized net actuarial loss
  (gain).....................        528         241        (47)   (2,918)   (5,446)   (3,218)
Special termination
  benefits...................         --          --         --       365        --        --
                               ---------   ---------   --------   -------   -------   -------
Benefit cost (income)........    (19,204)    (37,812)   (34,953)    1,503    (1,477)      726
Curtailment gains............         --      (8,898)        --        --      (327)       --
                               ---------   ---------   --------   -------   -------   -------
Benefit cost (income) after
  curtailments...............  $ (19,204)  $ (46,710)  $(34,953)  $ 1,503   $(1,804)  $   726
                               =========   =========   ========   =======   =======   =======
</TABLE>

     Assumptions used in the actuarial computations were as follows:

<TABLE>
<CAPTION>
                                              PENSION PLANS        POSTRETIREMENT BENEFITS
                                           --------------------    -----------------------
                                               DECEMBER 31               DECEMBER 31
                                           --------------------    -----------------------
                                           1999    1998    1997    1999     1998     1997
                                           ----    ----    ----    -----    -----    -----
<S>                                        <C>     <C>     <C>     <C>      <C>      <C>
Discount rate............................  7.25%   6.75%   7.50%   7.25%    6.75%    7.50%
Expected return on plan assets...........  9.75%   9.75%   9.75%    N/A      N/A      N/A
Rate of compensation increase............  5.00%   5.00%   5.00%   5.00%    5.00%    5.00%
</TABLE>

     At December 31, 1999, the health care trend rate of 8.0% was assumed to
ratably decline to 4.75% by 2009 and remain at that level. The assumed health
care cost trend rate can significantly affect postretirement expense and
liabilities. A change of 1% in the health care cost trend rate would have the
following effects (in thousands):

<TABLE>
<CAPTION>
                                                           1-PERCENTAGE-     1-PERCENTAGE-
                                                           POINT INCREASE    POINT DECREASE
                                                           --------------    --------------
<S>                                                        <C>               <C>
Effect on total service and interest cost component......     $ 1,323           $(1,099)
Effect on postretirement benefit obligation..............      10,934            (9,372)
</TABLE>

                                       57
<PAGE>   59
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     Benefits provided by the Employee Stock Option Plan (ESOP) are coordinated
with certain pension benefits and, as a result, the defined benefit plan
obligations are net of the actuarially equivalent value of the benefits earned
under the ESOP, with the maximum offset equal to the value of the benefits
earned under the defined benefit plan. The fair value of the ESOP assets was
$291.3 million and $264.7 million as of December 31, 1999 and 1998,
respectively. At December 31, 1999, the ESOP held 2.9 million shares of Series A
common stock and 1.4 million shares of Series C common stock. The final
contribution to the ESOP was in 1994 and the ESOP has been amended to
discontinue contributions by the Company. There are no unallocated shares in the
ESOP at December 31, 1999.

     Substantially all employees over age 21 with one year of service are
eligible to participate in the Company's Savings Plus Plan. Eligible employees
may contribute from 1% to 15% of their basic compensation. The Company makes
matching contributions equal to 50% of employee before-tax contributions from 1%
to 6%. Employees may choose among twelve investment options, including a Company
common stock fund, for investing their contributions and the Company's matching
contribution. Defined contribution plan expense, primarily related to the
Savings Plus Plan, was $15.1 million, $15.1 million and $15.5 million for the
years ended December 31, 1999, 1998 and 1997, respectively.

NOTE 16 -- SEGMENT INFORMATION

     The Company has three reportable business segments, Newspaper Publishing,
Professional Information and Magazine Publishing. The reportable segments are
each managed separately because they provide different products and services.
The Newspaper Publishing segment publishes daily metropolitan newspapers in the
east coast and west coast regions of the United States, as well as several
weekly newspapers. The Professional Information segment publishes aeronautical
charts and flight information. The Magazine Publishing segment publishes special
interest and trade magazines.

     The accounting policies of the segments are the same as those described in
the summary of significant accounting policies (see Note 1). The Company
evaluates performance based on several factors, of which the primary financial
measure is segment operating profit. Total revenue by industry segment includes
sales to unaffiliated customers and intersegment sales, which are recorded at
market price. Revenues are attributed to geographic areas based on the location
of the assets producing the revenues.

     Corporate and Other includes operations not directly related to the
operating segments and general corporate activities including corporate overhead
expenses, corporate investment income, interest expense on corporate debt and
the activities of the Company's affiliates, Eagle New Media and Eagle
Publishing. The Corporate and Other assets are principally comprised of cash and
cash equivalents, marketable securities and other investments. Substantially all
of the Company's investments accounted for under the equity method are in
Corporate and Other.

                                       58
<PAGE>   60
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     Financial data for the Company's segments is as follows (in thousands):

<TABLE>
<CAPTION>
                                                    1999          1998          1997
                                                 ----------    ----------    ----------
<S>                                              <C>           <C>           <C>
REVENUES
  Newspaper Publishing.........................  $2,514,325    $2,308,178    $2,179,244
  Professional Information.....................     235,356       211,929       195,339
  Magazine Publishing..........................     278,930       262,683       248,712
                                                 ----------    ----------    ----------
     Total reportable segments.................   3,028,611     2,782,790     2,623,295
  Corporate and Other..........................         638         1,198        21,845
  Intersegment Revenues........................          --            --            (5)
                                                 ----------    ----------    ----------
                                                 $3,029,249    $2,783,988    $2,645,135
                                                 ==========    ==========    ==========
OPERATING PROFIT (LOSS)(1)
  Newspaper Publishing.........................  $  457,067    $  297,433    $  402,207
  Professional Information.....................      64,789        43,858        55,659
  Magazine Publishing..........................      19,184       (14,232)       18,309
                                                 ----------    ----------    ----------
     Total reportable segments.................     541,040       327,059       476,175
  Corporate and Other..........................     (70,534)      (79,261)      (84,897)
                                                 ----------    ----------    ----------
                                                 $  470,506    $  247,798    $  391,278
                                                 ==========    ==========    ==========
IDENTIFIABLE ASSETS
  Newspaper Publishing.........................  $2,290,708    $1,999,880    $1,792,286
  Professional Information.....................     125,670        96,765        87,354
  Magazine Publishing..........................     287,268       271,457       263,521
                                                 ----------    ----------    ----------
     Total reportable segments.................   2,703,646     2,368,102     2,143,161
  Corporate and Other..........................   1,020,635     1,600,199       355,996
  Discontinued Operations......................     173,090       189,628       672,671
                                                 ----------    ----------    ----------
                                                 $3,897,371    $4,157,929    $3,171,828
                                                 ==========    ==========    ==========
DEPRECIATION AND AMORTIZATION
  Newspaper Publishing.........................  $  125,019    $  116,116    $  106,919
  Professional Information.....................       7,454         6,852         6,648
  Magazine Publishing..........................       8,667         7,740         7,040
                                                 ----------    ----------    ----------
     Total reportable segments.................     141,140       130,708       120,607
  Corporate and Other..........................       3,815         4,467         3,457
                                                 ----------    ----------    ----------
                                                 $  144,955    $  135,175    $  124,064
                                                 ==========    ==========    ==========
CAPITAL EXPENDITURES
  Newspaper Publishing.........................  $  151,807    $  107,479    $   78,760
  Professional Information.....................      12,437        15,825         9,535
  Magazine Publishing..........................       3,768         1,651         2,243
                                                 ----------    ----------    ----------
     Total reportable segments.................     168,012       124,955        90,538
  Corporate and Other..........................       5,472         6,593        22,543
                                                 ----------    ----------    ----------
                                                 $  173,484    $  131,548    $  113,081
                                                 ==========    ==========    ==========
</TABLE>

                                       59
<PAGE>   61
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

---------------
(1) Includes restructuring, one-time and other charges as follows (in
    thousands):

<TABLE>
<CAPTION>
                                                                1998       1997
                                                              --------    -------
<S>                                                           <C>         <C>
Newspaper Publishing........................................  $116,388    $18,000
Professional Information....................................    11,889         --
Magazine Publishing.........................................    29,072         --
                                                              --------    -------
  Total reportable segments.................................   157,349     18,000
Corporate and Other.........................................    17,021         --
                                                              --------    -------
                                                              $174,370    $18,000
                                                              ========    =======
</TABLE>

     The pretax charges in 1998 are comprised of restructuring and one-time
     charges of $155.7 million and other charges that did not qualify for
     accounting classification as restructuring charges of $18.7 million.

     Substantially all revenues and assets of the Company's reportable segments
are attributed to or located in the United States. Non-U.S. revenues represent
less than 3% of total revenues and are principally related to the Company's
flight information business in Germany.

     The Company does not have a single external customer who represents 10% or
more of its revenue.

     Significant non-cash items excluding depreciation and amortization, were
non-cash restructuring, one-time and other charges in 1998 as follows (in
thousands):

<TABLE>
<CAPTION>
                                                              1998
                                                             -------
<S>                                                          <C>
Newspaper Publishing.......................................  $19,043
Professional Information...................................    6,967
Magazine Publishing........................................   20,718
                                                             -------
  Total reportable segments................................   46,728
Corporate and Other........................................    6,055
                                                             -------
                                                             $52,783
                                                             =======
</TABLE>

     A reconciliation of operating profit to income from continuing operations
before income taxes is set forth in the Consolidated Statements of Income.

                                       60
<PAGE>   62
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 17 -- EARNINGS PER SHARE

     The following table sets forth the calculation of basic and diluted
earnings per share (in thousands, except per share amounts):

<TABLE>
<CAPTION>
                                                       1999        1998        1997
                                                     --------    --------    --------
<S>                                                  <C>         <C>         <C>
Earnings:
  Income from continuing operations................  $259,062    $134,059    $234,655
  Preferred stock dividends........................   (18,066)    (21,697)    (32,481)
                                                     --------    --------    --------
  Earnings applicable to common shareholders for
     basic earnings per share......................   240,996     112,362     202,174
  Effect of dilutive securities:
     LYONs interest expense, net of tax............     6,076          --       3,925
                                                     --------    --------    --------
  Earnings applicable to common shareholders for
     diluted earnings per share....................  $247,072    $112,362    $206,099
                                                     ========    ========    ========
Shares:
  Weighted average shares for basic earnings per
     share.........................................    68,252      84,814      92,572
  Effect of dilutive securities:
     Stock options.................................     1,924       2,114       2,358
     LYONs convertible debt........................     2,914          --       2,083
                                                     --------    --------    --------
                                                        4,838       2,114       4,441
                                                     --------    --------    --------
  Adjusted weighted average shares and assumed
     conversions for diluted earnings per share....    73,090      86,928      97,013
                                                     ========    ========    ========
Basic earnings per share from continuing
  operations.......................................  $   3.53    $   1.32    $   2.18
                                                     ========    ========    ========
Diluted earnings per share from continuing
  operations.......................................  $   3.38    $   1.29    $   2.12
                                                     ========    ========    ========
</TABLE>

     The Company has convertible preferred stock and certain stock options
outstanding which are not included in the calculation of diluted earnings per
share because the effects are antidilutive. The convertible preferred stock,
stock options and the LYONs are described in Note 13, Note 14 and Note 12,
respectively.

NOTE 18 -- OTHER COMPREHENSIVE INCOME

     Other comprehensive income primarily consists of unrealized gains (losses)
on available-for-sale securities as follows (in thousands):

<TABLE>
<CAPTION>
                                                        1999       1998        1997
                                                      --------    -------    --------
<S>                                                   <C>         <C>        <C>
Unrealized gains (losses) arising during period, net
  of taxes of $3,555, $17,712 and $(12,929).........  $  5,421    $25,753    $(18,850)
Reclassification adjustments for gains realized in
  net income, net of taxes of $9,825, $6,703 and
  $13,398...........................................   (14,285)    (9,647)    (19,320)
                                                      --------    -------    --------
Change in net unrealized gains (losses) on
  securities........................................  $ (8,864)   $16,106    $(38,170)
                                                      ========    =======    ========
</TABLE>

     Accumulated other comprehensive income for each classification is as
follows (in thousands):

<TABLE>
<CAPTION>
                                                                  DECEMBER 31
                                                              -------------------
                                                               1999        1998
                                                              -------    --------
<S>                                                           <C>        <C>
Net unrealized gains on securities, net of the change in
  PEPS fair value
  (see Note 12).............................................  $35,708    $ 44,572
Minimum pension liability adjustment........................   (6,088)     (4,396)
Foreign currency translation adjustments....................   (2,741)    (13,685)
                                                              -------    --------
                                                              $26,879    $ 26,491
                                                              =======    ========
</TABLE>

                                       61
<PAGE>   63
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 19 -- COMMITMENTS AND CONTINGENCIES

     The future net minimum lease payments as of December 31, 1999 for all
noncancelable operating leases, excluding future obligations included in the
restructuring liabilities on the Consolidated Balance Sheets, are as follows (in
thousands):

<TABLE>
<S>                                                         <C>
2000......................................................  $ 28,916
2001......................................................    26,566
2002......................................................    23,051
2003......................................................    19,586
2004......................................................    17,095
Thereafter................................................    65,384
                                                            --------
          Total...........................................  $180,598
                                                            ========
</TABLE>

     Rental expense under operating leases was $38.5 million, $34.2 million and
$36.9 million for the years ended December 31, 1999, 1998 and 1997,
respectively. Capital leases, contingent rentals and sublease income are not
significant.

     To assure a long-term supply of newsprint, the Company has certain
agreements with suppliers to purchase specified quantities of newsprint over
terms not exceeding five years at prevailing market prices.

     The Company and its subsidiaries are defendants in various actions for
matters arising out of their business operations. In addition, from time to
time, the Company and its subsidiaries are involved as parties in various
governmental and administrative proceedings. The Company does not believe that
any such proceedings currently pending will have a material adverse effect on
its consolidated financial position, although an adverse resolution in any
reporting period of one or more of these matters could have a material impact on
results of operations for that period.

NOTE 20 -- SUBSEQUENT EVENTS (UNAUDITED)

     In February 2000, Gilat Communications Ltd. acquired Allen Communication.
The Company also entered into agreements in February 2000 to sell StayWell to a
subsidiary of Havas MediMedia S.A., and to sell The Sporting News to Vulcan
Ventures Inc. These dispositions are expected to be completed in March 2000.

     On March 13, 2000, Times Mirror and Tribune Company (Tribune) signed a
definitive agreement for the merger of the two companies in a cash and stock
transaction valued at approximately $8 billion based on the closing price of
Tribune common stock on March 10, 2000. Under the terms of this agreement,
Tribune will make a cash tender offer for up to 28 million shares of the
Company's common stock, which represents approximately 48% of the shares of
common stock outstanding as of March 13, 2000, at a price of $95 per share.
Following completion of the tender offer, Times Mirror and Tribune will merge in
a transaction in which each share of Times Mirror common stock is converted into
2.5 shares of Tribune common stock. In addition, if fewer than 28 million Times
Mirror common shares are purchased in the tender offer, Times Mirror
shareholders will be permitted to elect cash, at a price of $95 per share, in
the merger, up to the balance of the 28 million shares. The merger is subject to
the approval of the shareholders of both companies and other customary
conditions, including regulatory approvals. Times Mirror expects the tender
offer to be completed in mid-April and the merger to be completed in the second
or third quarter of 2000.

                                       62
<PAGE>   64
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 21 -- QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

     A summary of the unaudited quarterly results of operations is as follows
(in thousands, except per share amounts):

<TABLE>
<CAPTION>
                                                          1999 QUARTERS ENDED
                                            ------------------------------------------------
                                            MARCH 31   JUNE 30    SEPTEMBER 30   DECEMBER 31
                                            --------   --------   ------------   -----------
<S>                                         <C>        <C>        <C>            <C>
Revenues..................................  $699,207   $753,751     $739,730      $836,561
Costs and expenses:
  Cost of sales...........................   391,037    417,759      393,432       413,045
  Selling, general and administrative
     expenses.............................   215,869    202,483      238,157       286,961
                                            --------   --------     --------      --------
Operating profit..........................    92,301    133,509      108,141       136,555
Interest expense, net.....................    (6,301)   (10,428)     (13,910)      (26,275)
Other, net................................     1,035     20,983        2,070         1,611
                                            --------   --------     --------      --------
Income from continuing operations before
  income taxes............................    87,035    144,064       96,301       111,891
Income tax provision......................    36,986     59,505       39,366        44,372
                                            --------   --------     --------      --------
Income from continuing operations.........    50,049     84,559       56,935        67,519
Discontinued operations, net..............    (1,236)       755          130           375
                                            --------   --------     --------      --------
Net income................................  $ 48,813   $ 85,314     $ 57,065      $ 67,894
                                            ========   ========     ========      ========
Basic earnings (loss) per common share(1):
  Continuing operations...................  $    .61   $   1.10     $    .76      $   1.10
  Discontinued operations.................      (.02)       .01           --            --
                                            --------   --------     --------      --------
Basic earnings per share..................  $    .59   $   1.11     $    .76      $   1.10
                                            ========   ========     ========      ========
Diluted earnings (loss) per common
  share(1):
  Continuing operations...................  $    .60   $   1.04     $    .73      $   1.03
  Discontinued operations.................      (.02)       .01           --            --
                                            --------   --------     --------      --------
Diluted earnings per share................  $    .58   $   1.05     $    .73      $   1.03
                                            ========   ========     ========      ========
</TABLE>

                                       63
<PAGE>   65
                            THE TIMES MIRROR COMPANY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
                                                          1998 QUARTERS ENDED
                                            ------------------------------------------------
                                            MARCH 31   JUNE 30    SEPTEMBER 30   DECEMBER 31
                                            --------   --------   ------------   -----------
<S>                                         <C>        <C>        <C>            <C>
Revenues..................................  $658,767   $698,007    $  677,128     $750,086
Costs and expenses:
  Cost of sales...........................   366,130    369,804       368,140      340,449
  Selling, general and administrative
     expenses.............................   206,812    206,789       216,303      306,082
  Restructuring and one-time charges......        --     34,850        46,262       74,569
                                            --------   --------    ----------     --------
Operating profit..........................    85,825     86,564        46,423       28,986
Interest expense, net.....................    (8,001)   (13,831)       (5,008)      (1,755)
Other, net................................      (487)     7,811         9,173        9,304
                                            --------   --------    ----------     --------
Income from continuing operations before
  income taxes............................    77,337     80,544        50,588       36,535
Income tax provision......................    31,915     31,928        31,293       15,809
                                            --------   --------    ----------     --------
Income from continuing operations.........    45,422     48,616        19,295       20,726
Discontinued operations, net..............      (161)       585     1,057,254      225,601
                                            --------   --------    ----------     --------
Net income................................  $ 45,261   $ 49,201    $1,076,549     $246,327
                                            ========   ========    ==========     ========
Basic earnings per common share(1):
  Continuing operations...................  $    .45   $    .49    $      .16     $    .19
  Discontinued operations.................        --        .01         12.55         2.86
                                            --------   --------    ----------     --------
Basic earnings per share..................  $    .45   $    .50    $    12.71     $   3.05
                                            ========   ========    ==========     ========
Diluted earnings per common share(1):
  Continuing operations...................  $    .44   $    .48    $      .16     $    .19
  Discontinued operations.................        --        .01         12.26         2.80
                                            --------   --------    ----------     --------
Diluted earnings per share................  $    .44   $    .49    $    12.42     $   2.99
                                            ========   ========    ==========     ========
</TABLE>

---------------
(1) Quarterly and annual earnings per share amounts are calculated independently
    based on the weighted average number of shares outstanding for each period.

                                       64
<PAGE>   66

                            THE TIMES MIRROR COMPANY

         SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                      CHARGED TO
                                         BALANCE AT    COSTS AND    CHARGED       DEDUCTIONS   BALANCE AT
                                         BEGINNING    EXPENSES OR   TO OTHER         FROM        END OF
                                         OF PERIOD     REVENUES     ACCOUNTS       RESERVES      PERIOD
                                         ----------   -----------   --------      ----------   ----------
<S>                                      <C>          <C>           <C>           <C>          <C>
Year ended December 31, 1999
  Allowance for doubtful accounts......   $25,956       $18,643     $  2,423       $(20,741)    $26,281
  Allowance for returns................    11,433        61,885       (2,160)       (62,718)      8,440
                                          -------       -------     --------       --------     -------
                                          $37,389       $80,528     $    263(A)    $(83,459)    $34,721
                                          =======       =======     ========       ========     =======
Year ended December 31, 1998
  Allowance for doubtful accounts......   $27,708       $19,240     $  1,610       $(22,602)    $25,956
  Allowance for returns................    11,131        59,191          (15)       (58,874)     11,433
                                          -------       -------     --------       --------     -------
                                          $38,839       $78,431     $  1,595(A)    $(81,476)    $37,389
                                          =======       =======     ========       ========     =======
Year ended December 31, 1997
  Allowance for doubtful accounts......   $25,659       $22,307     $    836       $(21,094)    $27,708
  Allowance for returns................    13,699        53,905       (1,506)       (54,967)     11,131
                                          -------       -------     --------       --------     -------
                                          $39,358       $76,212     $   (670)(A)   $(76,061)    $38,839
                                          =======       =======     ========       ========     =======
</TABLE>

---------------
(A) Primarily allowances of businesses acquired and sold.

Note: A detailed schedule of restructuring liabilities has been provided in Note
      7 to the consolidated financial statements.

                                       65
<PAGE>   67

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE.

     Not applicable.

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

     The information required by this item will be provided pursuant to General
Instruction G(3) of Form 10-K.

ITEM 11. EXECUTIVE COMPENSATION.

     The information required by this item will be provided pursuant to General
Instruction G(3) of Form 10-K.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The information required by this item will be provided pursuant to General
Instruction G(3) of Form 10-K.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     The information required by this item will be provided pursuant to General
Instruction G(3) of Form 10-K.

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

     (a)(1) and (a)(2) Financial Statements and Financial Statement Schedules
filed as part of this report:

        As listed in the Index to Financial Statements and Financial Statement
        Schedule on page 27 hereof.

     (a)(3) Exhibits filed as part of this report:

        As listed in the Exhibit Index beginning on page 69 hereof.

     (b) Reports on Form 8-K:

        The Company filed a Current Report on Form 8-K dated October 12, 1999
        filing a Statement of Eligibility of Trustee on Form T-1 of Citibank,
        N.A.

        The Company filed a Current Report on Form 8-K dated October 19, 1999
        relating to the issuance of $200,000,000 of Times Mirror's 6.65% Notes
        due October 15, 2001 and of $400,000,000 of Times Mirror's 7.45% Notes
        due October 15, 2009.

                                       66
<PAGE>   68

                                   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.

                                          THE TIMES MIRROR COMPANY

                                          By:      /s/ MARK H. WILLES
                                            ------------------------------------
                                                       Mark H. Willes
                                              Chairman of the Board, President
                                                and Chief Executive Officer

Dated: March 2, 2000

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons on behalf of the Registrant in
the capacities and on the dates indicated:

<TABLE>
<CAPTION>
                      SIGNATURE                                     TITLE                    DATE
                      ---------                                     -----                    ----
<S>                                                    <C>                              <C>
                 /s/ MARK H. WILLES                        Chairman of the Board,        March 2, 2000
-----------------------------------------------------    President, Chief Executive
                   Mark H. Willes                      Officer and Director (Principal
                                                             Executive Officer)

               /s/ EFREM ZIMBALIST III                  Executive Vice President and     March 2, 2000
-----------------------------------------------------      Chief Financial Officer
                 Efrem Zimbalist III                      (Principal Financial and
                                                             Accounting Officer)

                                                                  Director               March 2, 2000
-----------------------------------------------------
                    Susan Babcock

                 /s/ DONALD R. BEALL                              Director               March 2, 2000
-----------------------------------------------------
                   Donald R. Beall

                 /s/ JOHN E. BRYSON                               Director               March 2, 2000
-----------------------------------------------------
                   John E. Bryson

                                                                  Director               March 2, 2000
-----------------------------------------------------
                   Bruce Chandler

              /s/ CLAYTON W. FRYE, JR.                            Director               March 2, 2000
-----------------------------------------------------
                Clayton W. Frye, Jr.

                  /s/ ROGER GOODAN                                Director               March 2, 2000
-----------------------------------------------------
                    Roger Goodan

                 /s/ SHERRY LANSING                               Director               March 2, 2000
-----------------------------------------------------
                   Sherry Lansing

                /s/ DAWN GOULD LEPORE                             Director               March 2, 2000
-----------------------------------------------------
                  Dawn Gould Lepore

             /s/ ALFRED E. OSBORNE, JR.                           Director               March 2, 2000
-----------------------------------------------------
               Alfred E. Osborne, Jr.

                /s/ ROBERT W. SCHULT                              Director               March 2, 2000
-----------------------------------------------------
                  Robert W. Schult
</TABLE>

                                       67
<PAGE>   69

<TABLE>
<CAPTION>
                      SIGNATURE                                     TITLE                    DATE
                      ---------                                     -----                    ----
<S>                                                    <C>                              <C>
             /s/ WILLIAM STINEHART, JR.                           Director               March 2, 2000
-----------------------------------------------------
               William Stinehart, Jr.

              /s/ WARREN B. WILLIAMSON                            Director               March 2, 2000
-----------------------------------------------------
                Warren B. Williamson

                 /s/ EDWARD ZAPANTA                               Director               March 2, 2000
-----------------------------------------------------
                   Edward Zapanta
</TABLE>

                                       68
<PAGE>   70

                                 EXHIBIT INDEX

     Exhibits marked with an asterisk (*) are incorporated by reference to
documents previously filed by Times Mirror, or its predecessor Old Times Mirror,
with the Securities and Exchange Commission, as indicated. All other documents
listed are filed with this report, unless otherwise indicated.

<TABLE>
<CAPTION>
EXHIBIT
  NO.
-------
<C>        <S>
 *2.1      Contribution Agreement among Times Mirror, certain
           subsidiaries thereof, Chandler Trust No. 1 and Chandler
           Trust No. 2, dated August 8, 1997 (Exhibit 10.2 to Current
           Report on Form 8-K, dated August 8, 1997)
 *2.2      Amended and Restated Agreement and Plan of Merger, dated as
           of April 27, 1998, by and among Reed Elsevier U.S. Holdings
           Inc., Reed Elsevier Overseas BV, CBM Acquisition Parent Co.,
           CBM MergerSub Corp., Times Mirror, TMD, Inc. and Matthew
           Bender Company, Incorporated (Exhibit 2.1 to Times Mirror's
           Current Report on Form 8-K, dated July 31, 1998)
 *2.3      Partnership Interest Purchase Agreement, dated as of April
           26, 1998, by and among Times Mirror, Shepard's Inc., TM
           ShepCo, Inc., Reed Elsevier Inc. and Reed Books Inc.
           (Exhibit 2.2 to Times Mirror's Current Report on Form 8-K
           dated July 31, 1998)
 *2.4      Amended and Restated Agreement and Plan of Merger, dated as
           of October 8, 1998 by and among Harcourt Brace & Company,
           Mosby Parent Corp., Mosby Acquisition Corp., Times Mirror
           and Mosby, Inc. (Exhibit 2.1 to Times Mirror's Current
           Report on Form 8-K, dated October 9, 1998)
 *2.5      Contribution Agreement among Times Mirror, certain
           subsidiaries thereof, Eagle New Media Investments, LLC,
           Eagle Publishing Investments, LLC and Chandler Trust No. 1
           and Chandler Trust No. 2, dated September 3, 1999 (Exhibit
           10.2 to Times Mirror's Current Report on Form 8-K, dated
           September 3, 1999 and filed with the Securities and Exchange
           Commission on September 7, 1999)
 *2.6      Agreement and Plan of Merger dated as of March 13, 2000
           between Tribune Company and Times Mirror (Exhibit 2.1 to
           Times Mirror's Current Report on Form 8-K, dated October 13,
           2000)
 *2.7      Voting Agreement dated as of March 13, 2000 by and among
           Tribune Company and the other parties set forth on the
           signature pages thereto (Exhibit 2.2 to Times Mirror's
           Current Report on Form 8-K, dated October 13, 2000)
 *3.1      Restated Certificate of Incorporation of Times Mirror, as
           filed with the Secretary of State of the State of Delaware
           on January 23, 1995 (Exhibit to Times Mirror's Registration
           Statement on Form S-4 (File No. 33-87482))
 *3.2      Certificate of Amendment to Certificate of Incorporation of
           Times Mirror, as filed with the Secretary of State of the
           State of Delaware on February 1, 1995 (Exhibit to Times
           Mirror's Registration Statement on Form S-4 (File No.
           33-87482))
 *3.3      Certificate of Designations of Series C Common Stock, as
           filed with the Secretary of State of the State of Delaware
           on January 23, 1995 (Exhibit to Times Mirror's Registration
           Statement on Form S-4 (File No. 33-87482))
 *3.4      Amended and Restated Bylaws of Times Mirror (Exhibit 3.4 to
           Times Mirror's 1998 Annual Report on Form 10-K)
 *3.5      Certificate of Designations of Series A Preferred Stock
           (Exhibit 3.5 to Times Mirror's 1995 Annual Report on Form
           10-K)
 *3.6      Certificate of Designations of Series B Preferred Stock
           (Exhibit 3.6 to Times Mirror's 1995 Annual Report on Form
           10-K)
 *3.7      Certificate of Designation of Series C-1 Preferred Stock
           (Exhibit 4.1 to Times Mirror's Current Report on Form 8-K,
           dated August 8, 1997)
</TABLE>

                                       69
<PAGE>   71

<TABLE>
<CAPTION>
EXHIBIT
  NO.
-------
<C>        <S>
 *3.8      Certificate of Designation of Series C-2 Preferred Stock
           (Exhibit 4.2 to Times Mirror's Current Report on Form 8-K,
           dated August 8, 1997)
  3.9      Certificate of Designation of Series D-1 Preferred Stock
  3.10     Certificate of Designation of Series D-2 Preferred Stock
 *4.1      Indenture by and between New TMC Inc. (subsequently changed
           to The Times Mirror Company) and Wells Fargo Bank (successor
           to First Interstate Bank of California), as Trustee for the
           7 1/4% Debentures due 2013 and 7 1/2% Debentures due 2023,
           dated January 30, 1995 (Exhibit 4.1 to Times Mirror's 1995
           Annual Report on Form 10-K)
 *4.2      Specimen Note for 7 1/4% Debenture due March 1, 2013 (New
           TMC Inc., subsequently changed to The Times Mirror Company)
           (Exhibit 4.2 to Times Mirror's 1995 Annual Report on Form
           10-K)
 *4.3      Specimen Note for 7 1/2% Debenture due July 1, 2023 (New TMC
           Inc., subsequently changed to The Times Mirror Company)
           (Exhibit 4.3 to Times Mirror's 1995 Annual Report on Form
           10-K)
 *4.4      Indenture dated March 19, 1996, by and between The Times
           Mirror Company and Citibank, N.A., as Trustee for the 4 1/4%
           PEPS due March 15, 2001 and the 7 1/4% Debentures due
           November 15, 2096 (Exhibit 4.1 to Times Mirror's Current
           Report on Form 8-K, dated March 19, 1996)
 *4.5      Officers' Certificate dated as of March 19, 1996
           establishing the terms of the PEPS and attaching the
           Specimen Certificate for the 4 1/4% PEPS due March 15, 2001
           and the Specimen Certificate of Global PEPS (Exhibit 4.2 to
           Times Mirror's Current Report on Form 8-K, dated March 19,
           1996)
 *4.6      Officers' Certificate dated November 13, 1996 establishing
           the terms of the 7 1/4% Debentures due November 15, 2096 and
           attaching the specimen Form of Debenture (Exhibit 4.2 to
           Times Mirror's Current Report on Form 8-K, dated November
           13, 1996)
 *4.7      Indenture dated April 15, 1997 between Times Mirror and
           Citibank, N.A., as trustee (Exhibit 4.1 to Times Mirror's
           Current Report on Form 8-K, dated April 9, 1997)
 *4.8      Officer's Certificate dated September 9, 1997 establishing
           the terms of the 6.61% Debentures due September 15, 2027 and
           attaching the specimen Form of Debenture (Exhibit 4.2 to
           Times Mirror's Current Report on Form 8-K, dated September
           9, 1997)
 *4.9      Officers' Certificate dated October 19, 1999 establishing
           the terms of the 6.65% Notes due October 15, 2001 and the
           7.45% Notes due October 15, 2009 and attaching specimen
           Forms of Notes (Exhibit 4.2 to Times Mirror's Current Report
           on Form 8-K, dated October 19, 1999)
 *4.10     First Supplemental Indenture dated as October 19, 1999
           between Times Mirror and Citibank, N.A., as trustee (Exhibit
           4.3 to Times Mirror's Current Report on Form 8-K, dated
           October 19, 1999)
*10.1      Deferred Compensation Plan for Executives (Exhibit 10.1 to
           Times Mirror's 1994 Annual Report on Form 10-K)
*10.2      1987 Restricted Stock Plan (Exhibit II to Old Times Mirror's
           definitive Proxy Statement, dated March 27, 1987)
*10.3      1984 Executive Stock Option Plan (Exhibit A to Old Times
           Mirror's definitive Proxy Statement, dated April 23, 1984)
*10.4      1988 Executive Stock Option Plan (Exhibit A to Old Times
           Mirror's Proxy Statement, dated March 30, 1988)
</TABLE>

                                       70
<PAGE>   72

<TABLE>
<CAPTION>
EXHIBIT
  NO.
-------
<C>        <S>
*10.5      Deferral Plan for Directors' Fees (Exhibit 10.8 to Old Times
           Mirror's 1981 Annual Report on Form 10-K)
*10.6      The Times Mirror Pension Plan for Directors, as Amended and
           Restated on March 5, 1987 (Exhibit 10.11 to Old Times
           Mirror's 1986 Annual Report on Form 10-K)
*10.7      Deferred Compensation Plan for Non-Employee Directors
           (Exhibit 10.7 to Times Mirror's 1994 Annual Report on Form
           10-K)
*10.8      Non-Employee Director Stock Option Plan (Appendix A to Old
           Times Mirror's definitive Proxy Statement, dated March 21,
           1994)
*10.9      Agreement dated April 29, 1985 between Old Times Mirror and
           Otis Chandler (Exhibit 10.10 to Old Times Mirror's 1985
           Annual Report on Form 10-K)
*10.10     Letter Agreement amended and restated as of August 28, 1995
           between Times Mirror and Mark H. Willes (Exhibit 10.10 to
           Times Mirror's 1995 Annual Report on Form 10-K)
*10.11     1992 Key Employee Long-Term Incentive Plan (Appendix A to
           Old Times Mirror's Proxy Statement, dated March 20, 1992)
*10.12     1996 Management Incentive Plan (Exhibit 10.12 to Times
           Mirror's 1995 Annual Report on Form 10-K)
*10.13     Non-Employee Directors Stock Plan (Exhibit 10.13 to Times
           Mirror's 1995 Annual Report on Form 10-K)
*10.14     The Times Mirror Company Non-Employee Directors Stock Plan
           as amended and restated effective January 1, 1997 (Exhibit
           10.14 to Times Mirror's 1996 Annual Report on Form 10-K)
*10.15     The Times Mirror Company 1997 Directors Stock Option Plan
           (Exhibit 10.15 to Times Mirror's 1996 Annual Report on Form
           10-K)
*10.16     Limited Liability Company Agreement of TMCT, LLC, dated
           August 8, 1997 (Exhibit 10.1 to Times Mirror's Current
           Report on Form 8-K, dated August 8, 1997)
*10.17     Lease Agreement between TMCT, LLC and Times Mirror, dated
           August 8, 1997 (Exhibit 10.4 to Times Mirror's Current
           Report on Form 8-K, dated August 8, 1997)
*10.18     Amended and Restated Limited Liability Company Agreement of
           TMCT II, LLC, dated September 3, 1999 (Exhibit 10.1 to Times
           Mirror's Current Report on Form 8-K, dated September 3, 1999
           and filed with the Securities and Exchange Commission on
           September 7, 1999)
 10.19     Letter Agreement between Times Mirror and Mary E. Junck
           dated April 5, 1999
 10.20     Letter Agreement between Times Mirror and Thomas Unterman
           dated December 22, 1999
 11        Computation of Earnings Per Share
 12        Computation of Ratio of Earnings to Fixed Charges and Ratio
           of Earnings to Fixed Charges and Preferred Stock Dividends
 21        Subsidiaries of the Registrant
 23        Consent of Ernst & Young LLP, Independent Auditors
 27        Financial Data Schedule
</TABLE>

                                       71