UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended: March 31, 2011
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission File No. 1-33741
 A. H. Belo Corporation
 (Exact name of registrant as specified in its charter)
 Delaware
    
    38-3765318(State or other jurisdiction of
    
    (I.R.S. employerincorporation or organization)
    
    identification no.)P. O. Box 224866Dallas, Texas
    
    75222-4866(Address of principal executive offices)
    
    (Zip code)
 (214) 977-8200
 None
  Yes þ No o
  Yes o No o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
  Yes o No þ
  Class
    
    Outstanding at  April 29, 2011Common Stock, $.01 par value
    
    21,509,611




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##### 



A. H. BELO CORPORATION
 FORM 10-Q
 TABLE OF CONTENTS
 PagePART I FINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    3Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    15Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    21Item 4. Controls and Procedures
    
    
    21PART II OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    22Item 1A. Risk Factors
    
    
    22Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    22Item 3. Defaults Upon Senior Securities
    
    
    22Item 4. Removed and Reserved
    
    
    22Item 5. Other Information
    
    
    22Item 6. Exhibits
    
    
    23Signatures
    
    
    27EX-10.1.9EX-31.1EX-31.2EX-32
  2




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##### 



PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 A. H. Belo Corporation and Subsidiaries
 Three Months Ended March 31,In thousands, except per share amounts (unaudited)
    
    2011
    
    
    2010Net Operating RevenuesAdvertising
    
    $
    67,936
    
    
    $
    72,186Circulation
    
    
    35,052
    
    
    
    35,586Printing and distribution
    
    
    9,187
    
    
    
    7,986Total net operating revenues
    
    
    112,175
    
    
    
    115,758Operating Costs and ExpensesSalaries, wages and employee benefits
    
    
    50,495
    
    
    
    56,254Other production, distribution and operating
costs
    
    
    45,652
    
    
    
    46,030Newsprint, ink and other supplies
    
    
    14,502
    
    
    
    11,222Depreciation
    
    
    7,583
    
    
    
    9,164Amortization
    
    
    1,310
    
    
    
    1,310Total operating costs and expenses
    
    
    119,542
    
    
    
    123,980Loss from operations
    
    
    (7,367
    )
    
    
    (8,222
    )Other Income (Expense), NetInterest expense
    
    
    (207
    )
    
    
    (203
    )Other income, net
    
    
    1,267
    
    
    
    25Total other income (expense), net
    
    
    1,060
    
    
    
    (178
    )Loss before income taxes
    
    
    (6,307
    )
    
    
    (8,400
    )Income tax expense
    
    
    420
    
    
    
    728Net loss
    
    $
    (6,727
    )
    
    $
    (9,128
    )Net loss per share:Basic and diluted
    
    $
    (0.31
    )
    
    $
    (0.44
    )Weighted average shares outstanding:Basic and diluted
    
    
    21,383
    
    
    
    20,767
 See accompanying Notes to Condensed Consolidated Financial Statements.
 3




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##### 



CONDENSED CONSOLIDATED BALANCE SHEETS
 A. H. Belo Corporation and Subsidiaries
 In thousands, except share and per share amounts (unaudited)
    
    March 31, 2011
    
    
    December 31, 2010AssetsCurrent assets:Cash and cash equivalents
    
    $
    51,566
    
    
    $
    86,291Accounts receivable (net of allowance of $3,781 and $3,853
at March 31, 2011 and December 31, 2010, respectively)
    
    
    42,032
    
    
    
    56,793Funds held by Belo Corp. for future pension payments
    
    
    
    
    
    
    3,410Inventories
    
    
    15,038
    
    
    
    12,646Deferred income taxes, net
    
    
    1,248
    
    
    
    1,394Assets held for sale
    
    
    7,964
    
    
    
    5,268Prepaids and other current assets
    
    
    10,081
    
    
    
    7,157Total current assets
    
    
    127,929
    
    
    
    172,959Property, plant and equipment at cost:Land
    
    
    26,789
    
    
    
    26,789Buildings and improvements
    
    
    207,583
    
    
    
    207,486Publishing equipment
    
    
    281,528
    
    
    
    281,254Other
    
    
    139,939
    
    
    
    139,580Advance payments on property, plant and equipment
    
    
    5,204
    
    
    
    5,520Total property, plant and equipment
    
    
    661,043
    
    
    
    660,629Less accumulated depreciation
    
    
    490,422
    
    
    
    483,953Property, plant and equipment, net
    
    
    170,621
    
    
    
    176,676Intangible assets, net
    
    
    20,879
    
    
    
    22,189Goodwill
    
    
    24,582
    
    
    
    24,582Investments
    
    
    16,940
    
    
    
    16,661Deferred income taxes, net
    
    
    2,248
    
    
    
    2,127Other assets
    
    
    4,114
    
    
    
    4,855Total assets
    
    $
    367,313
    
    
    $
    420,049
 See accompanying Notes to Condensed Consolidated Financial Statements.
 4




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##### 



CONDENSED CONSOLIDATED BALANCE SHEETS (continued)
 A. H. Belo
 In thousands, except share and per share amounts (unaudited)
    
    March 31, 2011
    
    
    December 31, 2010Liabilities and Shareholders EquityCurrent liabilities:Accounts payable
    
    $
    17,996
    
    
    $
    29,159Accrued compensation and benefits
    
    
    19,125
    
    
    
    17,139Pension liabilities
    
    
    
    
    
    
    54,833Other accrued expenses
    
    
    10,089
    
    
    
    10,309Advance subscription payments
    
    
    24,768
    
    
    
    23,057Total current liabilities
    
    
    71,978
    
    
    
    134,497Long-term pension liabilities
    
    
    94,113
    
    
    
    77,513Other post-employment benefits
    
    
    3,195
    
    
    
    3,492Other liabilities
    
    
    3,981
    
    
    
    4,674Commitments and contingent liabilitiesShareholders equity:Preferred stock, $.01 par value. Authorized 2,000,000
shares; none issued
    
    
    
    
    
    
    Common stock, $.01 par value. Authorized 125,000,000 sharesSeries A: issued 19,118,076 and 18,896,876 shares at
March 31, 2011 and December 31, 2010,
respectively
    
    
    191
    
    
    
    188Series B: issued 2,391,535 and 2,392,074 shares at
March 31, 2011 and December 31, 2010,
respectively
    
    
    24
    
    
    
    24Additional paid-in capital
    
    
    492,593
    
    
    
    491,542Accumulated other comprehensive income
    
    
    2,415
    
    
    
    2,569Accumulated deficit
    
    
    (301,177
    )
    
    
    (294,450
    )Total shareholders equity
    
    
    194,046
    
    
    
    199,873Total liabilities and shareholders equity
    
    $
    367,313
    
    
    $
    420,049
 See accompanying Notes to Condensed Consolidated Financial Statements.
 5




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##### 



CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
 A. H. Belo
 In thousands, except share amounts (unaudited)
 AccumulatedCommon Stock
    
    
    Additional
    
    
    OtherShares
    
    
    Shares
    
    
    
    
    
    
    Paid-in
    
    
    Comprehensive
    
    
    AccumulatedSeries A
    
    
    Series B
    
    
    Amount
    
    
    Capital
    
    
    Income/(Loss)
    
    
    Deficit
    
    
    TotalBalance at December 31, 2009
    
    
    18,248,970
    
    
    
    2,507,590
    
    
    $
    207
    
    
    $
    488,241
    
    
    $
    3,364
    
    
    $
    (170,215
    )
    
    $
    321,597Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9,128
    )
    
    
    (9,128
    )Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9,128
    )Issuance of shares for restricted stock units
    
    
    144
    
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Issuance of shares from stock option exercises
    
    
    33,544
    
    
    
    
    
    
    
    
    
    
    
    172
    
    
    
    
    
    
    
    
    
    
    
    172Income tax on options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (173
    )
    
    
    
    
    
    
    
    
    
    
    (173
    )Conversion of Series B to Series A
    
    
    260
    
    
    
    (260
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Share-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,306
    
    
    
    
    
    
    
    
    
    
    
    1,306Balance at March 31, 2010
    
    
    18,282,918
    
    
    
    2,507,330
    
    
    $
    208
    
    
    $
    489,546
    
    
    $
    3,364
    
    
    $
    (179,343
    )
    
    $
    313,775Balance at December 31, 2010
    
    
    18,896,876
    
    
    
    2,392,074
    
    
    $
    212
    
    
    $
    491,542
    
    
    $
    2,569
    
    
    $
    (294,450
    )
    
    $
    199,873Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,727
    )
    
    
    (6,727
    )Other comprehensive loss:Other post-employment benefits, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (154
    )
    
    
    
    
    
    
    (154
    )Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,881
    )Issuance of shares for restricted stock units
    
    
    220,661
    
    
    
    
    
    
    
    3
    
    
    
    (3
    )
    
    
    
    
    
    
    
    
    
    
    Tax on option cancellations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    
    
    
    
    (1
    )Conversion of Series B to Series A
    
    
    539
    
    
    
    (539
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Share-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,055
    
    
    
    
    
    
    
    
    
    
    
    1,055Balance at March 31, 2011
    
    
    19,118,076
    
    
    
    2,391,535
    
    
    $
    215
    
    
    $
    492,593
    
    
    $
    2,415
    
    
    $
    (301,177
    )
    
    $
    194,046
 See accompanying Notes to Condensed Consolidated Financial Statements.
 6




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##### 



CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 A. H. Belo Corporation and Subsidiaries
 Three Months Ended March 31,In thousands (unaudited)
    
    2011
    
    
    2010OperationsNet loss
    
    $
    (6,727
    )
    
    $
    (9,128
    )Adjustments to reconcile net loss to net cash (used in)
provided by operations:Depreciation and amortization
    
    
    8,893
    
    
    
    10,474Gain on sale of investment
    
    
    (729
    )
    
    
    Earnings on equity method investments
    
    
    (279
    )
    
    
    Deferred income taxes
    
    
    15
    
    
    
    343Employee retirement benefit amortization
    
    
    (154
    )
    
    
    (95
    )Share-based compensation
    
    
    1,055
    
    
    
    2,106Other non-cash items
    
    
    18
    
    
    
    (673
    )Net changes in operating assets and liabilities:Accounts receivable, net
    
    
    14,761
    
    
    
    14,927Funds held by Belo for future pension contributions
    
    
    3,410
    
    
    
    4,072Inventories
    
    
    (2,392
    )
    
    
    (369
    )Assets held for sale
    
    
    (2,696
    )
    
    
    Prepaids and other current assets
    
    
    (2,924
    )
    
    
    (1,532
    )Other, net
    
    
    741
    
    
    
    (85
    )Accounts payable
    
    
    (11,163
    )
    
    
    (3,831
    )Accrued compensation, benefits and other
    
    
    1,297
    
    
    
    3,306Pension liabilities
    
    
    (38,233
    )
    
    
    Other accrued expenses
    
    
    (220
    )
    
    
    (584
    )Advance subscription payments
    
    
    1,711
    
    
    
    (234
    )Other post employment benefits
    
    
    (297
    )
    
    
    Net cash (used in) provided by operations
    
    
    (33,913
    )
    
    
    18,697InvestmentsCapital expenditures
    
    
    (1,528
    )
    
    
    (793
    )Proceeds from the sale of previously impaired investment
    
    
    729
    
    
    
    Other, net
    
    
    (13
    )
    
    
    457Net cash used for investments
    
    
    (812
    )
    
    
    (336
    )FinancingCash provided by financing activities
    
    
    
    
    
    
    Net (decrease) increase in cash and cash equivalents
    
    
    (34,725
    )
    
    
    18,361Cash and cash equivalents at beginning of period
    
    
    86,291
    
    
    
    24,503Cash and cash equivalents at end of period
    
    $
    51,566
    
    
    $
    42,864Supplemental DisclosuresInterest paid, net of amounts capitalized
    
    $
    72
    
    
    $
    Income taxes paid, net of refunds
    
    $
    (4,165
    )
    
    $
    261
 See accompanying Notes to Condensed Consolidated Financial Statements.
 7




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##### 



NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 A. H. Belo
  Note 1: Summary of Significant Accounting Policies
 Description of Business. A. H. Belo A. H. Belo A. H. Belo The Dallas Morning News ( www. dallasnews.com ) The Providence Journal (www. projo.com ) The Press-Enterprise
( www.pe.com ) Denton Record-Chronicle (www.dentonrc.com). www.cars.com A. H. Belo
 A. H. Belo A. H. Belo A. H. Belo A. H. Belo
 Basis of Presentation. A. H. Belo A. H. Belo
 Fair Value Measurements.
  Level 1  Unadjusted quoted prices in active markets accessible at the reporting date for
identical assets and liabilities.Level 2  Quoted prices for similar assets or liabilities in active markets. Quoted prices for
identical or similar assets and liabilities in markets that are not considered active or
financial instruments for which all significant inputs are observable, either directly or
indirectly.Level 3  Prices or valuations that require inputs that are significant to the valuation and
are unobservable.
 8




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##### 



G. B. Dealey
 Pension Plans
 Note 2: Long-term Incentive Plans
 A. H. Belo A. H. Belo A. H. Belo
 A. H. Belo Stock Option Activity
 A. H.
Belo
 Weighted-AverageNumber of
    
    
    ExerciseOptions
    
    
    PriceOustanding at December 31, 2010
    
    
    2,191,736
    
    
    $
    16.77Granted
    
    
    
    
    
    $
    Exercised
    
    
    
    
    
    $
    Canceled
    
    
    (4,500
    )
    
    $
    2.05Outstanding at March 31, 2011
    
    
    2,187,236
    
    
    $
    16.80Vested and exercisable at March 31, 2011
    
    
    1,915,484
    
    
    $
    18.72
 A. H. Belo RSU Activity
 A. H. Belo A. H. Belo A. H. Belo
 9




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##### 



The following table summarizes the RSU activity under A. H. Belos long-term incentive plan for
the period ended March 31, 2011:
 Issuance
    
    
    
    
    
    
    
    
    
    
    Weighted-of
    
    
    RSUs
    
    
    Cash Payments
    
    
    Average PriceCommon
    
    
    Redeemed
    
    
    at Closing Price
    
    
    on Date ofTotal RSUs
    
    
    Stock
    
    
    in Cash
    
    
    of Stock ($000)
    
    
    GrantNon-vested at December 31, 2010
    
    
    1,018,452
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    6.36Granted
    
    
    369,956
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    6.42Vested
    
    
    (367,801
    )
    
    
    220,661
    
    
    
    147,140
    
    
    $
    1,129
    
    
    $
    7.67Canceled
    
    
    (8,078
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    6.19Non-vested at March 31, 2011
    
    
    1,012,529
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    5.46
 Long-term incentive plan expense for the three months ended March 31, 2011 and 2010 consists of
the following:
 A. H. BeloEquity AwardsBeloCash
    
    
    Corp.
    
    
    TotalAwards for
    
    
    Equity
    
    
    IncentiveOptions
    
    
    RSUs
    
    
    Total
    
    
    RSUs
    
    
    Awards
    
    
    Awards2011
    
    $
    58
    
    
    $
    997
    
    
    $
    1,055
    
    
    $
    455
    
    
    $
    72
    
    
    $
    1,5822010
    
    $
    (433
    )
    
    $
    (1,739
    )
    
    $
    1,306
    
    
    $
    1,015
    
    
    $
    356
    
    
    $
    2,677
  Note 3: Pension and Other Retirement Plans
 A. H. Belo A. H. Belo A. H. Belo The Dallas Morning News A. H. Belo A. H. Belo The
Providence Journal. A. H. Belo A. H. Belo A. H. Belo A. H. Belo A. H. Belo A. H. Belo
 10




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##### 



A. H. Belo A. H. Belo
 Fair Value Measurements as of March 31, 2011Quoted Prices inActive Market
    
    
    Significant
    
    
    Significantfor Identical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    InputsLevel 1
    
    
    Level 2
    
    
    Level 3
    
    
    TotalDescriptionCash
    
    $
    1,779
    
    
    $
    
    
    
    $
    
    
    
    $
    1,779Money market funds
    
    
    400
    
    
    
    
    
    
    
    
    
    
    
    400Fixed income:
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Held in mutual funds
    
    
    
    
    
    
    99,882
    
    
    
    
    
    
    
    99,882Equity:
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Held in mutual funds
    
    
    
    
    
    
    144,910
    
    
    
    
    
    
    
    144,910Total plan assets
    
    $
    2,179
    
    
    $
    244,792
    
    
    $
    
    
    
    $
    246,971
    A. H. Belo
 Three MonthsEndedMarch 31, 2011Interest costs
    
    $
    4,675Return on plan assets (estimated)
    
    
    (4,175
    )Net expense
    
    $
    500
  Other Defined Contribution Plans.
  11




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##### 



Note 4: Contingencies
 The Dallas Morning News A. H. Belo
 A. H. Belo A. H. Belo
 Note 5: Investments
  March 31, 2011
    
    
    December 31, 2010Equity method investments
    
    $
    16,178
    
    
    $
    15,899Cost method investments
    
    
    762
    
    
    
    762Total investments
    
    $
    16,940
    
    
    $
    16,661
  
    
    Belo Investment, LLC (Belo Investment)  A. H. Belo and Belo each own a 50 percent
interest in Belo Investment. In connection with the February 2008 Distribution, Belo
Investment was formed to hold certain real properties including The Belo Building, related
parking sites, and other downtown Dallas real estate. A third party real estate services
firm, engaged by Belo Investment, manages The Belo Building and its other real estate
holdings, and the Company and Belo equally share the operating costs associated with these
properties.
    
    Classified Ventures, LLC (Classified Ventures)  A. H. Belo and Belo, through
subsidiaries, jointly own 6.6 percent of Classified Ventures, a joint venture in which the
other owners are Gannett Co., Inc., The McClatchy Company, Tribune Company, and The
Washington Post Company. The two principal online businesses Classified Ventures operates
are www.cars.comand www.apartments.com.
 Note 6: Goodwill and Intangible Assets
 The Dallas Morning News
 Total Subscriber
    
    
    The Dallas
    
    
    The Providence
    
    
    The Press-Lists
    
    
    Morning News
    
    
    Journal
    
    
    EnterpriseGross balance at December
31, 2010
    
    $
    114,824
    
    
    $
    22,896
    
    
    $
    78,698
    
    
    $
    13,230Accumulated amortization
    
    
    (92,635
    )
    
    
    (22,896
    )
    
    
    (60,480
    )
    
    
    (9,259
    )Net balance at December 31,
2010
    
    $
    22,189
    
    
    $
    
    
    
    $
    18,218
    
    
    $
    3,971Gross balance at March
31, 2011
    
    $
    114,824
    
    
    $
    22,896
    
    
    $
    78,698
    
    
    $
    13,230Accumulated amortization
    
    
    (93,945
    )
    
    
    (22,896
    )
    
    
    (61,574
    )
    
    
    (9,475
    )Net balance at March 31, 2011
    
    $
    20,879
    
    
    $
    
    
    
    $
    17,124
    
    
    $
    3,755
 12




---



##### 



Note 7: Long-term Debt
   Note 8: Fair Value Measurements
   Fair Value Measurements UsingQuoted Price in
    
    
    SignificantActive Markets
    
    
    Other
    
    
    SignificantThree Months
    
    
    for Indentical
    
    
    Observable
    
    
    UnobservableEnded
    
    
    Assets
    
    
    Inputs
    
    
    Inputs
    
    
    Total Gains(in thousands)
    
    March 31, 2011
    
    
    (Level I)
    
    
    (Level II)
    
    
    (Level III)
    
    
    (Losses)Assets held for sale
    
    $
    2,696
    
    
    $
    
    
    
    $
    
    
    
    $
    2,696
    
    
    $
    (400
    )
 Note 9: Income Taxes
      13




---



##### 



Note 10. Subsequent Events
 Declaration of Dividend
  14




---



##### 



Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
(Unless the context requires otherwise, all dollar amounts in the Quarterly Report on Form
10-Q are in thousands, except per share amounts.)
 The following information should be read in conjunction with the Companys Condensed Consolidated
Financial Statements and related Notes filed as part of this report.
 Overview
 A. H. Belo The Dallas Morning News
( www.dallasnews.com ) The
Providence Journal ( www.projo.com ) The Press-Enterprise ( www.pe.com ) Denton
Record-Chronicle (www.dentonrc.com) . www.cars.com A. H. Belo
 A. H. Belo A. H. Belo A. H. Belo A. H. Belo A. H. Belo
  Overview of Significant Activity in the Three Months Ended March 31, 2011
 
    
    During January 2011, the Company made a contribution of $8,733 to the GBD Pension Plan
to settle required contributions associated with the Transfer Agreement. During the first
quarter of 2011, the Company made a discretionary contribution of $30,000 to the A. H. Belo
Pension Plans, directly reducing the unfunded projected pension obligation assumed by the
A. H. Belo Pension Plans.
    
    The Company received $3,549 from Belo for the carryback of the Companys taxable net
operating losses against Belos taxable income from prior years. This amount had been recorded as a reduction of tax expense and a receivable from Belo in 2010.
    
    On March 3, 2011, the Company completed the purchase of the personal residence of a
Company officer pursuant to a retention and relocation arrangement. The residence was
recorded at an estimated fair value of $2,696, net of anticipated holding and selling costs
of $400.
    
    The Company recorded a gain of $729 for the sale of stock received in exchange for the
Companys shares of a previously impaired investment.
    
    The Dallas Morning Newsreceived a sales tax refund, resulting in an expense reduction
of $591.
    
    The Company completed funding the settlement related to litigation brought by former
independent home delivery contractors of The Press-Enterprise. During the three months
ended March 31, 2011, the Company funded $532, net of insurance proceeds.
    
    The Company recorded expense of $421 after announcing that it would provide a 1.5
percent match of employee 401(k) contributions occurring in the first two quarters of 2011.
No match was provided in 2010.
    
    The Company received a summary judgment in its favor, dismissing a lawsuit mainly
consisting of employment claims of unlawful discrimination and ERISA violations.
    
    The Dallas Morning Newsre-launched its flagship Web site, www.dallasnews.com,
with an improved design and released an upgraded iPhone application and its first iPad
application. Access to digital content remains free for home delivery subscribers of The
Dallas Morning News,but a monthly subscription fee is charged to digital only subscribers.
 15




---



##### 



Results of Operations
 Condensed Consolidated Results of Operations
  Three Months Ended March 31,Percentage2011
    
    
    Change
    
    
    2010RevenuesAdvertising
    
    $
    67,936
    
    
    
    (5.9)
    %
    
    $
    72,186Circulation
    
    
    35,052
    
    
    
    (1.5)
    %
    
    
    35,586Printing and distribution
    
    
    9,187
    
    
    
    15.0
    %
    
    
    7,986Total revenue
    
    
    112,175
    
    
    
    (3.1)
    %
    
    
    115,758Operating costs and expenses
    
    
    119,542
    
    
    
    (3.6)
    %
    
    
    123,980Other income (expense), net
    
    
    1,060
    
    
    
    (695.5)
    %
    
    
    (178
    )Loss before income taxes
    
    
    (6,307
    )
    
    
    (24.9)
    %
    
    
    (8,400
    )Income tax expense
    
    
    420
    
    
    
    (42.3)
    %
    
    
    728Net loss
    
    $
    (6,727
    )
    
    
    (26.3)
    %
    
    $
    (9,128
    )
 Newspaper Revenues
 The Dallas Morning News
 The Dallas Morning News
 Three Months Ended March 31,Percent
    
    
    
    
    
    
    
    
    
    
    Percentof Total
    
    
    Percentage
    
    
    
    
    
    
    of Total2011
    
    
    Revenues
    
    
    Change
    
    
    2010
    
    
    RevenuesAdvertising
    
    $
    44,673
    
    
    
    60.6
    %
    
    
    -1.4
    %
    
    $
    45,311
    
    
    
    61.1
    %Display
    
    
    17,860
    
    
    
    
    
    
    
    -9.3
    %
    
    
    19,695Classified
    
    
    7,419
    
    
    
    
    
    
    
    2.9
    %
    
    
    7,210Preprints
    
    
    13,719
    
    
    
    
    
    
    
    1.9
    %
    
    
    13,469Digital
    
    
    5,675
    
    
    
    
    
    
    
    14.9
    %
    
    
    4,937Circulation
    
    
    23,502
    
    
    
    31.8
    %
    
    
    0.3
    %
    
    
    23,437
    
    
    
    31.6
    %Printing and distribution
    
    
    5,642
    
    
    
    7.6
    %
    
    
    4.9
    %
    
    
    5,379
    
    
    
    7.3
    %$
    73,817
    
    
    
    100.0
    %
    
    
    -0.4
    %
    
    $
    74,127
    
    
    
    100.0
    %
 The Dallas Morning News
  16




---



##### 



The Dallas Morning News www.cars.com
 The Dallas Morning News Briefing Al-Dia Quick The Dallas
Morning News
   The Providence Journal
 The Providence Journal
 Three Months Ended March 31,Percent
    
    
    
    
    
    
    
    
    
    
    Percentof Total
    
    
    Percentage
    
    
    
    
    
    
    of Total2011
    
    
    Revenues
    
    
    Change
    
    
    2010
    
    
    RevenuesAdvertising
    
    $
    12,413
    
    
    
    56.4
    %
    
    
    -15.0
    %
    
    $
    14,595
    
    
    
    60.6
    %Display
    
    
    4,289
    
    
    
    
    
    
    
    -15.1
    %
    
    
    5,049Classified
    
    
    3,423
    
    
    
    
    
    
    
    -19.8
    %
    
    
    4,267Preprints
    
    
    3,077
    
    
    
    
    
    
    
    -8.5
    %
    
    
    3,364Digital
    
    
    1,624
    
    
    
    
    
    
    
    -15.2
    %
    
    
    1,915Circulation
    
    
    8,136
    
    
    
    36.9
    %
    
    
    -5.0
    %
    
    
    8,563
    
    
    
    35.5
    %Printing and distribution
    
    
    1,474
    
    
    
    6.7
    %
    
    
    58.3
    %
    
    
    931
    
    
    
    3.9
    %$
    22,023
    
    
    
    100.0
    %
    
    
    -8.6
    %
    
    $
    24,089
    
    
    
    100.0
    %
     17




---



##### 



The Providence Journals The Providence Journal
 The Press-Enterprise
 The Press-Enterprise
 Three Months Ended March 31,Percent
    
    
    
    
    
    
    
    
    
    
    Percentof Total
    
    
    Percentage
    
    
    
    
    
    
    of Total2011
    
    
    Revenues
    
    
    Change
    
    
    2010
    
    
    RevenuesAdvertising
    
    $
    10,850
    
    
    
    66.4
    %
    
    
    -11.6
    %
    
    $
    12,280
    
    
    
    70.0
    %Display
    
    
    2,783
    
    
    
    
    
    
    
    -15.5
    %
    
    
    3,295Classified
    
    
    3,275
    
    
    
    
    
    
    
    -23.7
    %
    
    
    4,295Preprints
    
    
    3,293
    
    
    
    
    
    
    
    3.1
    %
    
    
    3,195Digital
    
    
    1,499
    
    
    
    
    
    
    
    0.3
    %
    
    
    1,495Circulation
    
    
    3,414
    
    
    
    20.9
    %
    
    
    -4.8
    %
    
    
    3,586
    
    
    
    20.4
    %Printing and distribution
    
    
    2,071
    
    
    
    12.7
    %
    
    
    23.6
    %
    
    
    1,676
    
    
    
    9.6
    %$
    16,335
    
    
    
    100.0
    %
    
    
    -6.9
    %
    
    $
    17,542
    
    
    
    100.0
    %
     The Press-Enterprises
 18




---



##### 



Operating Costs and Expenses
 Three Months Ended March 31,Percentage2011
    
    
    Change
    
    
    2010Salaries, wages and employee benefits
    
    $
    50,495
    
    
    
    (10.2)
    %
    
    $
    56,254Other production, distribution and operating costs
    
    
    45,652
    
    
    
    (0.8)
    %
    
    
    46,030Newsprint, ink and other supplies
    
    
    14,502
    
    
    
    29.2
    %
    
    
    11,222Depreciation
    
    
    7,583
    
    
    
    (17.3)
    %
    
    
    9,164Amortization
    
    
    1,310
    
    
    
    
    %
    
    
    1,310Total operating costs and expenses
    
    $
    119,542
    
    
    
    (3.6)
    %
    
    $
    123,980
 A. H. Belo
 Interest Expense
  Other Income, Net
 .
 Income Taxes
   19




---



##### 



Liquidity and Capital Resources
   Sources of Liquidity
    
    March 31, 2011Cash and cash equivalents
    
    $
    51,566Accounts receivable, net
    
    
    42,032Unused borrowing capacity
    
    
    20,005Total
    
    $
    113,603
   Operating Cash Flows
 A. H. Belo A. H. Belo
  Investing Cash Flows
   Financing Cash Flows
  Contractual Obligations
 A. H. Belo
 20




---



##### 



A. H. Belo A. H. Belo
  Critical Accounting Policies and Estimates
 A. H. Belo A. H. Belo
 Forward-Looking Statements
 A. H. Belo
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
 A. H. Belo
 
 Item 4. Controls and Procedures
   21




---



##### 



PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
 The Dallas Morning News A. H. Belo
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Removed and Reserved
 
 Item 5. Other Information
   22




---



##### 



Item 6. Exhibits
  Exhibit Number
    
    Description2.1
    
    
*
    Separation and Distribution Agreement by and between Belo Corp. and A. H. Belo Corporation dated as of
February 8, 2008 (Exhibit 2.1 to the Companys Current Report on Form 8-K filed with the Securities and
Exchange Commission on February 12, 2008 (Securities and Exchange Commission File No. 001-33741) (the February
12, 2008 Form 8-K))3.1
    
    
*
    Amended and Restated Certificate of Incorporation of the Company (Exhibit 3.1 to Amendment No. 3 to the
Companys Form 10 dated January 18, 2008 (Securities and Exchange Commission File No. 001-33741) (the Third
Amendment to Form 10))3.2
    
    
*
    Certificate of Designations of Series A Junior Participating Preferred Stock of the Company dated January 11,
2008 (Exhibit 3.2 to Post-Effective Amendment No. 1 to Form 10 dated January 31, 2008 (Securities and Exchange
Commission File No. 001-33741))3.3
    
    
*
    Amended and Restated Bylaws of the Company, effective January 11, 2008 (Exhibit 3.3 to the Third Amendment to
Form 10)4.1
    
    
*
    Certain rights of the holders of the Companys Common Stock are set forth in Exhibits 3.1-3.3 above4.2
    
    
*
    Specimen Form of Certificate representing shares of the Companys Series A Common Stock (Exhibit 4.2 to the
Third Amendment to Form 10)4.3
    
    
*
    Specimen Form of Certificate representing shares of the Companys Series B Common Stock (Exhibit 4.3 to the
Third Amendment to Form 10)4.4
    
    
*
    Rights Agreement dated as of January 11, 2008 between the Company and Mellon Investor Services LLC (Exhibit
4.4 to the Third Amendment to Form 10)10.1
    
    

    Financing agreements:(1)*  Credit Agreement dated as of February 4, 2008 among the Company, as Borrower, JPMorgan Chase, N.A., as
Administrative Agent, JPMorgan Securities Inc. and Banc of America Securities LLC, as Joint Lead Arrangers and
Bookrunners, Bank of America, N.A., as Syndication Agent, SunTrust Bank and Capitol One Bank, N.A. as
Co-Documentation Agents (Exhibit 99.1 to the Companys Current Report on Form 8-K filed with the Securities and
Exchange Commission on February 5, 2008 (Securities and Exchange Commission File No. 001-33741))(2)*  First Amendment and Waiver to the Credit Agreement dated as of October 23, 2008 (Exhibit 10.1 to the
Companys Current Report on Form 8-K filed with the Securities and Exchange Commission on October 24, 2008
(Securities and Exchange Commission File No. 001-33741))
 23




---



##### 



Exhibit Number
    
    Description(3)*  Amended and Restated Credit Agreement dated as of January 30, 2009, (Exhibit 10.1 to the Companys Current
Report on Form 8-K filed with the Securities and Exchange Commission on February 2, 2009 (Securities and
Exchange Commission File No. 001-33741) (the February 2, 2009 Form 8-K))(4)*  Amended and Restated Pledge and Security Agreement dated as of January 30, 2009 (Exhibit 10.2 to the
February 2, 2009 From 8-K)(a)   First Amendment to Amended and Restated Security Agreement dated as of May 2, 2011 (See Exhibit 10.1(9) below)(5)*  First Amendment to the Amended and Restated Credit Agreement dated as of August 18, 2009 (Exhibit 10.1(5)
to the Companys Quarterly Report on Form 10-Q file with the Securities and Exchange Commission on December 13,
2009 (Securities and Exchange Commission File No. 001-33741))(6)*  Second Amendment to the Amended and Restated Credit Agreement dated as of December 3, 2009, 2009 (Exhibit
10.1 to the Companys Current Report on Form 8-K filed with the Securities and Exchange Commission on December
4, 2009 (Securities and Exchange Commission File No. 001-33741))(7)*  Third Amendment to the Amended and Restated Credit Agreement dated as of August 18, 2010 (Exhibit 10.1(7)
to the Companys Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 3,
2010 (Securities and Exchange Commission File No. 001-33741))(8)*  Fourth Amendment to the Amended and Restated Credit Agreement dated as of March 10, 2011, (Exhibit 10.1(8)
to the Companys Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 11, 2011
(Securities and Exchange Commission File No. 001-33741))(9)  Fifth Amendment to the Amended
and Restated Credit Agreement and First
Amendment to Amended and Restated Security Agreement dated as of May 2, 201110.2
    
    

    Compensatory plans and Arrangements:~
    (1)*  A. H. Belo Corporation Savings Plan (Exhibit 10.4 to the February 12, 2008 Form 8-K)*
    (a) First Amendment to the A. H. Belo Savings Plan dated September 23, 2008 (Exhibit 10.2(1)(A) to the
Companys Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 14, 2008
(Securities and Exchange Commission File No. 001-33741))
 24




---



##### 



Exhibit Number
    
    Description~
(2)
    * A. H. Belo Corporation 2008 Incentive Compensation Plan (Exhibit 10.5 to the February 12, 2008 Form 8-K)*
(a)
    First Amendment to A. H. Belo 2008 Incentive Compensation Plan effective July 23, 2008 (Exhibit
10.2(2)(A) to the Companys Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on
August 14, 2008 (Securities and Exchange Commission File No. 001-33741))*
(b)
    Form of A. H. Belo 2008 Incentive Compensation Plan Non-Employee Director Evidence of Grant
(for Non-Employee Director Awards) (Exhibit 10.2.2(b) to the Companys Quarterly Report on Form
10-Q filed with the Securities and Exchange Commission on May 13, 2010 (Securities and Exchange
Commission File No. 001-33741) (the 1st Quarter 2010 Form 10-Q))*
(c)
    Form of A. H. Belo 2008 Incentive Compensation Plan Evidence of Grant (for Employee Awards)
(Exhibit 10.1 to the Companys Current Report on Form 8-K filed with the Securities and Exchange
Commission on March 11, 2011, (Securities and Exchange Commission File No. 001-33741))~
(3)
    * A. H. Belo Pension Transition Supplement Restoration Plan effective January 1, 2008 (Exhibit 10.6 to the
February 12, 2008 Form 8-K)*
(a)
    First Amendment to the A. H. Belo Pension Transition Supplement Restoration Plan dated March 31, 2009
(Exhibit 10.4 to the April 2, 2009 From 8-K)~
(4)
    * A. H. Belo Corporation Change In Control Severance Plan (Exhibit 10.7 to the February 12, 2008 Form 8-K)*
(a)
    Amendment to the A. H. Belo Change in Control Severance Plan dated March 31, 2009 (Exhibit 10.3 to the
April 2, 2009 Form 8-K)~
(5)
    * John C. McKeon Retention and Relocation Agreement effective September 22, 2010 (Exhibit 10.2(5) to
the Companys Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 11, 2011
(Securities and Exchange Commission File No. 001-33741))10.3
    
    

    Agreements relating to the Distribution of A. H. Belo:
 (1)* Tax Matters Agreement by and between Belo Corp. and A. H. Belo Corporation dated as of February 8, 2008
(Exhibit 10.1 to the February 12, 2008 Form 8-K)
 *
    
    (a) First Amendment to Tax Matters Agreement by and between Belo Corp. and A. H. Belo
Corporation dated September 14, 2009 (Exhibit 10.1 to the Companys Current Report on Form
8-K filed with the Securities and Exchange Commission on September 15, 2009 (Securities and
Exchange Commission file No. 00-00371))
 (2)* Employee Matters Agreement by and between Belo Corp. and A. H. Belo Corporation dated as of February 8,
2008 (Exhibit 10.2 to the February 12, 2008 Form 8-K)
 *
    
    (a) Amendment to Employee Matters Agreement as set forth in the Pension Plan Transfer
Agreement dated as of October 6, 2010 (Exhibit 10.1 to the October 8, 2010 Form 8-K)
 25




---



##### 



Exhibit Number
    
    Description(3)*
    Services Agreement by and between Belo Corp. and A. H. Belo Corporation dated as of February 8, 2008
(Exhibit 10.3 to the February 12, 2008 Form 8-K)(4)*
    Separation and Distribution Agreement by and between Belo Corp. and A. H. Belo Corporation dated as of
February 8, 2008 (See Exhibit 2.1 to the February 12, 2008 Form 8-K)(5)*
    Pension Plan Transfer Agreement by and between Belo Corp. and A. H. Belo Corporation dated as of October
6, 2010 (Exhibit 10.1 to the Companys Report on Form 8-K filed with the Securities and Exchange Commission on
October 8, 2010 (Securities and Exchange Commission File No. 001-33741) (the October 8, 2010 Form 8-K))(6)*
    Agreement among the Company, Belo Corp., and The Pension Benefit Guaranty Corporation, effective
March 9, 2011, (Exhibit 10.3(6) to the Companys Annual Report on Form 10-K filed with the Securities and
Exchange Commission on March 11, 2011 (Securities and Exchange Commission File No. 001-33741))
 31.1
    
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200232
    
    
    Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 26




---



##### 



SIGNATURES
  A. H. BELO CORPORATIONMay 4, 2011
    By:
    /s/ Alison K. EngelAlison K. EngelSenior Vice President/Chief Financial Officer and
Treasurer (Principal Financial Officer)May 4, 2011
    By:
    /s/ Michael N. LaveyMichael N. LaveyVice President/Controller
(Principal Accounting Officer) 27




---



##### 



EXHIBIT INDEX
 Exhibit Number
    
    Description10.1(4)(a)
    

First Amendment to
Amended and Restated Security Agreement dated as of May 2, 2011 (See Exhibit 10.1(9) below)10.1(9)
    

Fifth
Amendment to the Amended and Restated Credit Agreement dated as of
May 2, 201131.1
    
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200232
    
    
    Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 28