##### 



FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION


Washington, DC 20549


(Mark One)

|    |  |                                                                                          
|--- |  | -----------------------------------------------------------------------------------------
|[x] |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934  
|    |  | For the quarterly period ended September 30, 2003                                        
|[ ] |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
|    |  | For the transition period from to                                                        

Commission File Number 1-5846

THE LIBERTY CORPORATION




(Exact name of registrant as specified in its charter)


|                                                               |  |                                  
|-------------------------------------------------------------- |  | ---------------------------------
|South Carolina                                                 |  | 57-0507055                       
|(State or other jurisdiction of
incorporation or organization) |  | (IRS Employer
identification No.)

135 South Main Street, Greenville, SC 29601
(Address of principal executive offices)

Registrants telephone number, including area code: 864/241-5400

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 whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes X No

Indicate the number of shares outstanding of each of the Registrants classes
of common stock as of the latest practicable date.

|                    |  |                              |            | 
|------------------- |  | ---------------------------- | ---------- | 
|                    |  | Number of shares Outstanding
|Title of each class |  | as of September 30, 2003    
|                    |  |                             
|Common Stock        |  |                              | 19,238,700 | 





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##### 



PART I, ITEM 1

THE LIBERTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND CONDENSED BALANCE SHEETS

|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |          |         |   |         | 
|------------------------------------------------------------------------------------------------------------------------ | ---------------------------------------------------- | -------------------------- | ------- | ------------------------------------------ | ------- | - | ------- | -------- | ------- | - | ------- | 
|(In
000's)                                                                                                               |                                                      | September 30,              |         | December 31,                              
|                                                                                                                         |                                                      | 2003                       |         | 2002                                      
|                                                                                                                         |                                                      |                            |         |                                           
|ASSETS                                                                                                                   |                                                      | (Unaudited)                |         |                                            |         |  
|Current assets:                                                                                                          |                                                      |                            |         |                                            |         |   |         |         
|                                                                                                                         | Cash and cash equivalents                            |                            | $       | 66,245                                     |         |   | $       | 67,917   |        
|                                                                                                                         | Receivables (net of allowance for doubtful accounts) |                            |         | 37,825                                     |         |   |         | 42,069   |        
|                                                                                                                         | Program rights                                       |                            |         | 6,183                                      |         |   |         | 4,433    |        
|                                                                                                                         | Prepaid and other current assets                     |                            |         | 2,749                                      |         |   |         | 2,982    |        
|                                                                                                                         | Income taxes receivable                              |                            |         | 152                                        |         |   |         | 2,370    |        
|                                                                                                                         | Deferred income taxes                                |                            |         | 7,561                                      |         |   |         | 5,508    |        
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |         
|                                                                                                                         |                                                      |                            |         | Total current assets                       |         |   | 120,715 |          |         |   | 125,279 | 
|Property, plant, and equipment                                                                                           |                                                      |                            |         |                                            |         |   |         |         
|                                                                                                                         | Land                                                 |                            |         | 5,657                                      |         |   |         | 5,639    |        
|                                                                                                                         | Buildings and improvements                           |                            |         | 53,978                                     |         |   |         | 52,638   |        
|                                                                                                                         | Furniture and equipment                              |                            |         | 168,236                                    |         |   |         | 157,401  |        
|                                                                                                                         | Less: Accumulated depreciation                       |                            |         | (128,796                                   | )       |   |         | (120,409 | )      
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |         
|                                                                                                                         |                                                      |                            | 99,075  |                                            |         |   | 95,269  |         
|Intangible assets subject to amortization (net of
$786 and $688 accumulated amortization in 2003 and
2002, respectively) |                                                      |                            | 325     |                                            |         |   | 369     |         
|FCC licenses and network affiliations                                                                                    |                                                      |                            | 304,525 |                                            |         |   | 304,285 |         
|Goodwill                                                                                                                 |                                                      |                            | 101,387 |                                            |         |   | 101,387 |         
|Investments and other assets                                                                                             |                                                      |                            | 45,768  |                                            |         |   | 44,162  |         
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |          |        
|                                                                                                                         |                                                      |                            |         | Total assets                               |         | $ | 671,795 |          |         | $ | 670,751 | 
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |         
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                                     |                                                      |                            |         |                                            |         |   |         |         
|Current liabilities:                                                                                                     |                                                      |                            |         |                                            |         |   |         |         
|                                                                                                                         | Accounts payable and accrued expenses                |                            | $       | 22,205                                     |         |   | $       | 24,433   |        
|                                                                                                                         | Program contract obligations                         |                            |         | 6,155                                      |         |   |         | 4,486    |        
|                                                                                                                         | Accrued income taxes                                 |                            |         | 96                                         |         |   |         |         |        
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |          |        
|                                                                                                                         |                                                      |                            |         | Total current liabilities                  |         |   | 28,456  |          |         |   | 28,919  | 
|Unearned revenue                                                                                                         |                                                      |                            | 7,678   |                                            |         |   | 5,637   |         
|Deferred income taxes                                                                                                    |                                                      |                            | 96,883  |                                            |         |   | 91,647  |         
|Other liabilities                                                                                                        |                                                      |                            | 6,363   |                                            |         |   | 6,312   |         
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |          |        
|                                                                                                                         |                                                      |                            |         | Total liabilities                          |         |   | 139,380 |          |         |   | 132,515 | 
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |         
|Shareholders equity                                                                                                     |                                                      |                            |         |                                            |         |   |         |         
|                                                                                                                         | Common stock                                         |                            |         | 85,621                                     |         |   |         | 92,978   |        
|                                                                                                                         | Unearned stock compensation                          |                            |         | (4,782                                     | )       |   |         | (3,802   | )      
|                                                                                                                         | Retained earnings                                    |                            |         | 451,317                                    |         |   |         | 448,887  |        
|                                                                                                                         | Unrealized investment gains                          |                            |         | 259                                        |         |   |         | 173      |        
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |         
|                                                                                                                         |                                                      | Total shareholders equity |         |                                            | 532,415 |   |         |          | 538,236 |  
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |          |        
|                                                                                                                         |                                                      |                            |         | Total liabilities and shareholders equity |         | $ | 671,795 |          |         | $ | 670,751 | 
|                                                                                                                         |                                                      |                            |         |                                            |         |   |         |         

See Notes to Consolidated and Condensed Financial Statements.

2



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##### 



THE LIBERTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND CONDENSED STATEMENTS OF OPERATIONS

|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |         |         |        | 
|-------------------------------------------------------------------------------------- | ------------------------ | ----------------- | ---------------------------------------------------------------------------------------- | ------ | ------------------ | ----- | ----------------- | ------ | ----------- | ------ | ------- | ------- | ------ | ------ | ------- | ------- | ------- | ------ | 
|                                                                                       |                          |                   |                                                                                          |        | Three Months Ended |       | Nine Months Ended
|                                                                                       |                          |                   |                                                                                          |        | September 30,      |       | September 30,    
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                  
|(In
000's, except per share data)                                                      |                          | 2003              |                                                                                          | 2002   |                    | 2003  |                   | 2002  
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |       
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        | (Unaudited) |        |         |         |       
|REVENUES                                                                               |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|Station revenues (net of commissions)                                                  |                          | $                 | 45,211                                                                                   |        |                    | $     | 46,173            |        |             | $      | 133,511 |         |        | $      | 133,269 |        
|Cable advertising and other revenues                                                   |                          |                   | 3,864                                                                                    |        |                    |       | 3,993             |        |             |        | 11,159  |         |        |        | 11,528  |        
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|                                                                                       | Net revenues             |                   |                                                                                          | 49,075 |                    |       |                   | 50,166 |             |        |         | 144,670 |        |        |         | 144,797 |        
|EXPENSES                                                                               |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|Operating expenses                                                                     |                          |                   | 30,001                                                                                   |        |                    |       | 28,725            |        |             |        | 89,505  |         |        |        | 84,479  |        
|Amortization of program rights                                                         |                          |                   | 1,776                                                                                    |        |                    |       | 1,826             |        |             |        | 5,236   |         |        |        | 5,542   |        
|Depreciation and amortization of intangibles                                           |                          |                   | 4,758                                                                                    |        |                    |       | 4,433             |        |             |        | 13,580  |         |        |        | 13,343  |        
|Corporate, general, and administrative expenses                                        |                          |                   | 3,424                                                                                    |        |                    |       | 3,586             |        |             |        | 10,249  |         |        |        | 9,186   |        
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|                                                                                       | Total operating expenses |                   |                                                                                          | 39,959 |                    |       |                   | 38,570 |             |        |         | 118,570 |        |        |         | 112,550 |        
|                                                                                       |                          |                   | Operating income                                                                         |        |                    | 9,116 |                   |        |             | 11,596 |         |         |        | 26,100 |         |         |         | 32,247 | 
|Net investment income (loss)                                                           |                          |                   | 674                                                                                      |        |                    |       | (87               | )      |             |        | (74     | )       |        |        | 113     |        
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|                                                                                       |                          |                   | Income before income taxes and the cumulative
effect of a change in accounting principle |        |                    | 9,790 |                   |        |             | 11,509 |         |         |        | 26,026 |         |         |         | 32,360 | 
|Provision for income taxes                                                             |                          |                   | 3,671                                                                                    |        |                    |       | 4,332             |        |             |        | 9,760   |         |        |        | 12,255  |        
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|                                                                                       |                          |                   | Income before the cumulative effect of a change
in accounting principle                  |        |                    | 6,119 |                   |        |             | 7,177  |         |         |        | 16,266 |         |         |         | 20,105 | 
|Cumulative effect of a change in accounting
principle (net of income taxes of $29,045) |                          |                   |                                                                                         |        |                    |       |                  |        |             |        |        |         |        |        | (47,388 | )      
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|                                                                                       |                          | NET INCOME (LOSS) |                                                                                          | $      | 6,119              |       |                   | $      | 7,177       |        |         | $       | 16,266 |        |         | $       | (27,283 | )     
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|BASIC EARNINGS (LOSS) PER COMMON SHARE:                                                |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|From income before the cumulative effect of a
change in accounting principle           |                          | $                 | 0.32                                                                                     |        |                    | $     | 0.37              |        |             | $      | 0.85    |         |        | $      | 1.02    |        
|Cumulative effect of a change in accounting principle                                  |                          |                   |                                                                                         |        |                    |       |                  |        |             |        |        |         |        |        | (2.41   | )      
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|Basic earnings (loss) per common share                                                 |                          | $                 | 0.32                                                                                     |        |                    | $     | 0.37              |        |             | $      | 0.85    |         |        | $      | (1.39   | )      
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|DILUTED EARNINGS (LOSS) PER COMMON SHARE:                                              |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|From income before the cumulative effect of a
change in accounting principle           |                          | $                 | 0.32                                                                                     |        |                    | $     | 0.36              |        |             | $      | 0.84    |         |        | $      | 1.02    |        
|Cumulative effect of a change in accounting principle                                  |                          |                   |                                                                                         |        |                    |       |                  |        |             |        |        |         |        |        | (2.40   | )      
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|Diluted earnings (loss) per common share                                               |                          | $                 | 0.32                                                                                     |        |                    | $     | 0.36              |        |             | $      | 0.84    |         |        | $      | (1.38   | )      
|                                                                                       |                          |                   |                                                                                          |        |                    |       |                   |        |             |        |         |         |        |        |         |        
|Dividends per common share                                                             |                          | $                 | 0.24                                                                                     |        |                    | $     | 0.22              |        |             | $      | 0.72    |         |        | $      | 0.66    |        

See Notes to Consolidated and Condensed Financial Statements.

3



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##### 



THE LIBERTY CORPORATION AND SUBSIDIARIES
CONSOLIDATED AND CONDENSED STATEMENTS OF CASH FLOWS

|                                                                                                   |                                       |                                                                     |         |                                 |        |   |         |        |        | 
|-------------------------------------------------------------------------------------------------- | ------------------------------------- | ------------------------------------------------------------------- | ------- | ------------------------------- | ------ | - | ------- | ------ | ------ | 
|                                                                                                   |                                       |                                                                     |         | Nine Months Ended September 30,
|                                                                                                   |                                       |                                                                     |         |                                
|(In
000's)                                                                                         |                                       | 2003                                                                |         | 2002                           
|                                                                                                   |                                       |                                                                     |         |                                
|                                                                                                   |                                       |                                                                     |         | (Unaudited)                    
|OPERATING ACTIVITIES                                                                               |                                       |                                                                     |         |                                 |        |   |         |       
|Net income (loss)                                                                                  |                                       | $                                                                   | 16,266  |                                 |        | $ | (27,283 | )     
|Less: Cumulative effect of a change in accounting principle                                        |                                       |                                                                     |        |                                 |        |   | 47,388  |       
|                                                                                                   |                                       |                                                                     |         |                                 |        |   |         |       
|                                                                                                   |                                       | Income before cumulative effect of a change in accounting principle |         |                                 | 16,266 |   |         |        | 20,105 | 
|Adjustments to reconcile net income (loss) to net cash provided by (used
in) operating activities: |                                       |                                                                     |         |                                 |        |   |         |       
|                                                                                                   | Loss on sale of operating assets      |                                                                     |         | 285                             |        |   |         | 77     |       
|                                                                                                   | Realized investment losses            |                                                                     |         | 1,149                           |        |   |         | 3,327  |       
|                                                                                                   | Depreciation                          |                                                                     |         | 13,395                          |        |   |         | 12,707 |       
|                                                                                                   | Amortization of intangibles           |                                                                     |         | 185                             |        |   |         | 636    |       
|                                                                                                   | Amortization of program rights        |                                                                     |         | 5,236                           |        |   |         | 5,542  |       
|                                                                                                   | Cash paid for program rights          |                                                                     |         | (5,317                          | )      |   |         | (5,734 | )     
|                                                                                                   | Provision for deferred income taxes   |                                                                     |         | 3,183                           |        |   |         | 1,893  |       
|Changes in operating assets and liabilities:                                                       |                                       |                                                                     |         |                                 |        |   |         |       
|                                                                                                   | Receivables                           |                                                                     |         | 4,244                           |        |   |         | 4,861  |       
|                                                                                                   | Other assets                          |                                                                     |         | 3,431                           |        |   |         | 16,397 |       
|                                                                                                   | Accounts payable and accrued expenses |                                                                     |         | (725                            | )      |   |         | 3,133  |       
|                                                                                                   | Accrued income taxes                  |                                                                     |         | 96                              |        |   |         | 6,637  |       
|                                                                                                   | Unearned revenue                      |                                                                     |         | 2,041                           |        |   |         | 1,933  |       
|                                                                                                   | Other liabilities                     |                                                                     |         | 51                              |        |   |         | (3,114 | )     
|                                                                                                   | All other operating activities        |                                                                     |         | (587                            | )      |   |         | 675    |       
|                                                                                                   |                                       |                                                                     |         |                                 |        |   |         |       
|NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                                                |                                       |                                                                     | 42,933  |                                 |        |   | 69,075  |       
|INVESTING ACTIVITIES                                                                               |                                       |                                                                     |         |                                 |        |   |         |       
|Purchase of property, plant, and equipment                                                         |                                       |                                                                     | (17,556 | )                               |        |   | (15,648 | )     
|Proceeds from the sale of property, plant, and equipment                                           |                                       |                                                                     | 70      |                                 |        |   | 149     |       
|Investments acquired                                                                               |                                       |                                                                     | (5,900  | )                               |        |   | (10,585 | )     
|Proceeds from sale of investments                                                                  |                                       |                                                                     |        |                                 |        |   | 201     |       
|Proceeds from sale of investment properties                                                        |                                       |                                                                     | 3,562   |                                 |        |   | 1,228   |       
|                                                                                                   |                                       |                                                                     |         |                                 |        |   |         |       
|NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES                                                |                                       |                                                                     | (19,824 | )                               |        |   | (24,655 | )     
|FINANCING ACTIVITIES                                                                               |                                       |                                                                     |         |                                 |        |   |         |       
|Dividends paid                                                                                     |                                       |                                                                     | (13,836 | )                               |        |   | (13,043 | )     
|Stock issued for employee benefit and compensation programs                                        |                                       |                                                                     | 1,376   |                                 |        |   | 648     |       
|Repurchase of common stock                                                                         |                                       |                                                                     | (12,321 | )                               |        |   | (6,536  | )     
|                                                                                                   |                                       |                                                                     |         |                                 |        |   |         |       
|NET CASH PROVIDED BY(USED IN) FINANCING ACTIVITIES                                                 |                                       |                                                                     | (24,781 | )                               |        |   | (18,931 | )     
|INCREASE (DECREASE) IN CASH                                                                        |                                       |                                                                     | (1,672  | )                               |        |   | 25,489  |       
|Cash at beginning of period                                                                        |                                       |                                                                     | 67,917  |                                 |        |   | 35,489  |       
|                                                                                                   |                                       |                                                                     |         |                                 |        |   |         |       
|CASH AT END OF PERIOD                                                                              |                                       | $                                                                   | 66,245  |                                 |        | $ | 60,978  |       
|                                                                                                   |                                       |                                                                     |         |                                 |        |   |         |       

See Notes to Consolidated and Condensed Financial Statements.

4



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##### 



THE LIBERTY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND CONDENSED FINANCIAL STATEMENTS
September 30, 2003
(Unaudited)



|1. |  | BASIS OF PRESENTATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | The accompanying unaudited consolidated and condensed financial statements
of The Liberty Corporation and Subsidiaries have been prepared in accordance
with accounting principles generally accepted in the United States for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by accounting principles generally
accepted in the United States for complete financial statements. The
information included is not necessarily indicative of the annual results
that may be expected for the year ended December 31, 2003, but it does
reflect all adjustments (which are of a normal and recurring nature)
considered, in the opinion of management, necessary for a fair presentation
of the results for the interim periods presented. The December 31, 2002
financial information was derived from the Companys previously filed 2002
Form 10-K. For further information, refer to the consolidated financial
statements and footnotes thereto included in The Liberty Corporation annual
report on Form 10-K for the year ended December 31, 2002.
|  
|2. |  | STATEMENT NO. 142 GOODWILL AND OTHER INTANGIBLE ASSETS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|  
|   |  | During the second quarter of 2001, the Financial Accounting Standards Board
(FASB) issued Statement No. 142 Goodwill and Other Intangible Assets.
Statement No. 142 requires that goodwill and certain other identified
intangibles no longer be amortized to earnings, but instead be reviewed for
impairment. The amortization of goodwill and certain other identified
intangibles ceased upon adoption of the Statement, which for the Company was
January 1, 2002. In connection with the adoption of Statement No. 142, the
Company reduced the carrying value of its FCC licenses by $76.4 million
($47.4 million after-tax) as a cumulative effect of a change in accounting
principle.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|  
|   |  | At September 30, 2003 and December 31, 2002, the Companys intangible assets
not subject to amortization were comprised of FCC licenses and network
affiliations. At September 30, 2003 and December 31, 2002, the Companys
intangible assets subject to amortization were comprised of leases acquired
through station purchases for space on certain of its towers, non-compete
agreements, and loan costs associated with the Companys unused line of
credit.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|  
|3. |  | COMPREHENSIVE INCOME                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|  
|   |  | The components of comprehensive income, net of related income taxes, for the
three and nine month periods ended September 30, 2003 and 2002,
respectively, are as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

|                                          |  |                    |       |                   |  |      |       |      |  |   |        |  |  |   |         |  
|----------------------------------------- |  | ------------------ | ----- | ----------------- |  | ---- | ----- | ---- |  | - | ------ |  |  | - | ------- | -
|                                          |  | Three Months Ended |       | Nine Months Ended
|                                          |  | September 30,      |       | September 30,    
|                                          |  |                    |       |                  
|                                          |  | 2003               |       | 2002              |  | 2003 |       | 2002
|                                          |  |                    |       |                   |  |      |       |     
|(In 000's)                                |  |                    |       |                   |  |      |       |      |  |   |        |  |  |   |         |  
|Net income (loss)                         |  | $                  | 6,119 |                   |  | $    | 7,177 |      |  | $ | 16,266 |  |  | $ | (27,283 | )
|Unrealized gains / (losses) on securities |  |                    | (6    | )                 |  |      | 19    |      |  |   | 86     |  |  |   | 438     |  
|                                          |  |                    |       |                   |  |      |       |      |  |   |        |  |  |   |         |  
|Comprehensive income (loss)               |  | $                  | 6,113 |                   |  | $    | 7,196 |      |  |   | 16,352 |  |  | $ | (26,845 | )
|                                          |  |                    |       |                   |  |      |       |      |  |   |        |  |  |   |         |  

5



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##### 





|4. |  | SEGMENT REPORTING                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | The Company operates primarily in the television broadcasting and cable
advertising businesses. The Company currently owns and operates fifteen
television stations, primarily in the Southeast and Midwest. Each of the
stations is affiliated with a major network, with eight NBC affiliates, five
ABC affiliates, and two CBS affiliates. The Company evaluates segment
performance based on income before income taxes, excluding unusual, or
non-operating items.
|  
|   |  | The following table summarizes financial information by segment for the
three and nine month periods ended September 30, 2003 and 2002:                                                                                                                                                                                                                                                                                                                                

|                                                                                           |                     |               |                    |               |                   |   |        |        |      |   |         |         |   |   |         |         |  
|------------------------------------------------------------------------------------------ | ------------------- | ------------- | ------------------ | ------------- | ----------------- | - | ------ | ------ | ---- | - | ------- | ------- | - | - | ------- | ------- | -
|                                                                                           |                     |               | Three Months Ended |               | Nine Months Ended
|(In
000's)                                                                                 |                     | September 30, |                    | September 30,
|                                                                                           |                     |               |                    |              
|                                                                                           |                     |               | 2003               |               | 2002              |   | 2003   |        | 2002
|                                                                                           |                     |               |                    |               |                   |   |        |        |     
|Revenues (net of commissions)                                                              |                     |               |                    |               |                   |   |        |        |      |   |         |         |   |   |         |        
|                                                                                           | Broadcasting        |               | $                  | 45,211        |                   |   | $      | 46,173 |      |   | $       | 133,511 |   |   | $       | 133,269 |  
|                                                                                           | Cable advertising   |               |                    | 3,827         |                   |   |        | 3,864  |      |   |         | 10,940  |   |   |         | 11,228  |  
|                                                                                           | Other               |               |                    | 37            |                   |   |        | 129    |      |   |         | 219     |   |   |         | 300     |  
|                                                                                           |                     |               |                    |               |                   |   |        |        |      |   |         |         |   |   |         |        
|Total net revenues                                                                         |                     | $             | 49,075             |               |                   | $ | 50,166 |        |      | $ | 144,670 |         |   | $ | 144,797 |        
|                                                                                           |                     |               |                    |               |                   |   |        |        |      |   |         |         |   |   |         |        
|Income before income taxes
and cumulative effect of a
change in accounting
principle       |                     |               |                    |               |                   |   |        |        |      |   |         |         |   |   |         |        
|                                                                                           | Broadcasting        |               | $                  | 12,436        |                   |   | $      | 14,826 |      |   | $       | 36,516  |   |   | $       | 41,074  |  
|                                                                                           | Cable advertising   |               |                    | 528           |                   |   |        | 542    |      |   |         | 1,055   |   |   |         | 1,321   |  
|                                                                                           | Corporate and other |               |                    | (3,174        | )                 |   |        | (3,859 | )    |   |         | (11,545 | ) |   |         | (10,035 | )
|                                                                                           |                     |               |                    |               |                   |   |        |        |      |   |         |         |   |   |         |        
|Total income before income
taxes and cumulative effect
of a change in accounting
principle |                     | $             | 9,790              |               |                   | $ | 11,509 |        |      | $ | 26,026  |         |   | $ | 32,360  |        
|                                                                                           |                     |               |                    |               |                   |   |        |        |      |   |         |         |   |   |         |         |  



| |  | There were no material changes in assets by segment from those disclosed in
the Companys 2002 annual report. The goodwill that appears on the face of
the balance sheet arose through the acquisition of certain television
stations, and therefore has been assigned in its entirety to the
Broadcasting segment.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|5. |  | EARNINGS PER SHARE                                                                                      
|-- |  | --------------------------------------------------------------------------------------------------------
|  
|   |  | The calculation of basic and diluted earnings per common share from
continuing operations is as follows:

|                                                                                                                                           |               |               |                    |               |                   |   |        |    |      |   |        |     |  |   |        |    | 
|------------------------------------------------------------------------------------------------------------------------------------------ | ------------- | ------------- | ------------------ | ------------- | ----------------- | - | ------ | -- | ---- | - | ------ | --- |  | - | ------ | -- | 
|                                                                                                                                           |               |               | Three Months Ended |               | Nine Months Ended
|(In
000's, except per share data)                                                                                                          |               | September 30, |                    | September 30,
|                                                                                                                                           |               |               |                    |              
|                                                                                                                                           |               |               | 2003               |               | 2002              |   | 2003   |    | 2002
|                                                                                                                                           |               |               |                    |               |                   |   |        |    |     
|Numerator  Earnings:                                                                                                                      |               |               |                    |               |                   |   |        |    |      |   |        |     |  |   |        |   
|Income before the cumulative effect of
change in accounting principle                                                                      |               | $             | 6,119              |               |                   | $ | 7,177  |    |      | $ | 16,266 |     |  | $ | 20,105 |   
|Effect of dilutive securities                                                                                                              |               |               |                   |               |                   |   |       |    |      |   |       |     |  |   |       |   
|                                                                                                                                           |               |               |                    |               |                   |   |        |    |      |   |        |     |  |   |        |   
|Numerator for basic and diluted earnings
per common share                                                                                  |               | $             | 6,119              |               |                   | $ | 7,177  |    |      | $ | 16,266 |     |  | $ | 20,105 |   
|                                                                                                                                           |               |               |                    |               |                   |   |        |    |      |   |        |     |  |   |        |   
|Denominator  Average Shares Outstanding:                                                                                                  |               |               |                    |               |                   |   |        |    |      |   |        |     |  |   |        |   
|Denominator for basic earnings before
the cumulative effect of a change in
accounting principle per common share  weighted average shares |               |               | 19,119             |               |                   |   | 19,632 |    |      |   | 19,153 |     |  |   | 19,664 |   
|Effect of dilutive securities:                                                                                                             |               |               |                    |               |                   |   |        |    |      |   |        |     |  |   |        |   
|                                                                                                                                           | Stock options |               |                    | 131           |                   |   |        | 38 |      |   |        | 120 |  |   |        | 90 | 
|                                                                                                                                           |               |               |                    |               |                   |   |        |    |      |   |        |     |  |   |        |   
|Denominator for diluted earnings before
the cumulative effect of a change in
accounting principle per common share                         |               |               | 19,250             |               |                   |   | 19,670 |    |      |   | 19,273 |     |  |   | 19,754 |   
|                                                                                                                                           |               |               |                    |               |                   |   |        |    |      |   |        |     |  |   |        |   
|Basic earnings before the cumulative
effect of a change in accounting
principle per common share                                           |               | $             | 0.32               |               |                   | $ | 0.37   |    |      | $ | 0.85   |     |  | $ | 1.02   |   
|Diluted earnings before the cumulative
effect of a change in accounting
principle per common share                                         |               | $             | 0.32               |               |                   | $ | 0.36   |    |      | $ | 0.84   |     |  | $ | 1.02   |   



|6. |  | EQUITY COMPENSATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | In accordance with the provisions of SFAS No. 123, Accounting for
Stock-Based Compensation, the Company has elected to follow
Accounting Principles Board Opinion No. 25, Accounting for Stock
Issued to Employees (APB No. 25) and related interpretations in
accounting for its equity compensation plans and does not recognize
compensation expense for its stock-based compensation plans other
than for awards of restricted shares. Expense is recognized over the
vesting period of the restricted shares.
|  
|   |  | Under APB No. 25, because the exercise price of the Companys
employee stock options at least equals the market price of the
underlying stock on the date of the grant, no compensation expense is
recognized. Pro forma information regarding net income and earnings
per share is required by SFAS No. 123, and has been determined as if
the Company had accounted for its employee stock options under the
fair value method of that statement.                                                                     

7



---



##### 





| |  | The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options that have no vesting
restrictions and are fully transferable. In addition, option
valuation models require the input of highly subjective assumptions
including the expected stock price volatility. Because the Companys
employee stock options have characteristics significantly different
from those of traded options, and because changes in the subjective
input assumptions can materially affect the fair value estimate, in
managements opinion, the existing models do not necessarily provide
a reliable single measure of the fair value of its employee stock
options.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | For purposes of pro forma disclosures, the estimated fair value of
the options is amortized to expense over the options vesting
periods. The Companys pro forma information is as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

|                                                                    |                             |                      |      |                     |      |   |      |       |      |   |      |        |  |   |      |         |  
|------------------------------------------------------------------- | --------------------------- | -------------------- | ---- | ------------------- | ---- | - | ---- | ----- | ---- | - | ---- | ------ |  | - | ---- | ------- | -
|(In
$000's, except per share amounts)                               |                             | For the Three Months |      | For the Nine Months
|                                                                    |                             | Ended September 30,  |      | Ended September 30,
|                                                                    |                             |                      |      |                     |     
|                                                                    |                             |                      | 2003 |                     | 2002 |   | 2003 |       | 2002
|                                                                    |                             |                      |      |                     |      |   |      |       |     
|Stock-based compensation cost included in
net income (net of taxes) |                             | $                    | 236  |                     |      | $ | 169  |       |      | $ | 969  |        |  | $ | 440  |        
|Net income (loss):                                                  |                             |                      |      |                     |      |   |      |       |      |   |      |        |  |   |      |        
|                                                                    | As reported                 |                      | $    | 6,119               |      |   | $    | 7,177 |      |   | $    | 16,266 |  |   | $    | (27,283 | )
|Pro forma compensation expense (net of taxes)                       |                             |                      | (206 | )                   |      |   | (224 | )     |      |   | (569 | )      |  |   | (671 | )      
|                                                                    |                             |                      |      |                     |      |   |      |       |      |   |      |        |  |   |      |        
|                                                                    | Pro forma net income (loss) |                      | $    | 5,913               |      |   | $    | 6,953 |      |   | $    | 15,697 |  |   | $    | (27,945 | )
|Basic earnings (loss) per share:                                    |                             |                      |      |                     |      |   |      |       |      |   |      |        |  |   |      |        
|                                                                    | As reported                 |                      | $    | 0.32                |      |   | $    | 0.37  |      |   | $    | 0.85   |  |   | $    | (1.39   | )
|                                                                    | Pro forma                   |                      |      | 0.31                |      |   |      | 0.35  |      |   |      | 0.82   |  |   |      | (1.42   | )
|Diluted earnings (loss) per share:                                  |                             |                      |      |                     |      |   |      |       |      |   |      |        |  |   |      |        
|                                                                    | As reported                 |                      | $    | 0.32                |      |   | $    | 0.36  |      |   | $    | 0.84   |  |   | $    | (1.38   | )
|                                                                    | Pro forma                   |                      |      | 0.31                |      |   |      | 0.35  |      |   |      | 0.82   |  |   |      | (1.42   | )



|7. |  | CREDIT FACILITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   |  | On March 21, 2001, the Company entered into a $100 million unsecured
364-day revolving credit facility with a bank. On May 19, 2003,
the Company renewed the facility for an additional year on
substantially similar terms. No amounts have been drawn on this
facility since inception.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|  
|8. |  | NEW ACCOUNTING INTERPRETATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|   |  | During the first quarter of 2003, the FASB issued Interpretation No.
46 Consolidation of Variable Interest Entities, an interpretation
of Accounting Research Bulletin No. 51 Consolidated Financial
Statements. The Interpretation requires the consolidation of
entities in which an enterprise absorbs a majority of the entitys
expected losses (as defined in Interpretation No. 46),
receives a majority of the entitys expected residual returns (as
defined in Interpretation No. 46), or both, as a result of ownership,
contractual or other financial interests in the entity. At this
time, the Company does not believe that Interpretation No. 46 will
have a material effect on its financial statements. The consolidation
requirements of Interpretation 46 apply immediately to variable
interest entities created after January 31, 2003. The consolidation
requirements apply to older entities in the first interim period
beginning after December 15, 2003.
|  
|9. |  | RECLASSIFICATIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|   |  | Certain reclassifications have been made in the previously reported
financial statements to make the prior year amounts comparable to those
of the current year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

8



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##### 



PART I, ITEM 2
MANAGEMENTS DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
(Unaudited)

The Liberty Corporation is a holding company with operations primarily in the
television broadcasting and cable advertising businesses. The Companys
television broadcasting subsidiary, Cosmos Broadcasting, consists of fifteen
network-affiliated stations located in the Southeast and Midwest, along with
other ancillary businesses. Eight of the Companys television stations are
affiliated with NBC, five with ABC, and two with CBS.

SEASONALITY OF TELEVISION REVENUES

The Companys revenues are usually subject to seasonal fluctuations. The
advertising revenues of the stations are generally highest in the second and
fourth quarters of each year, due in part to increases in consumer advertising
in the spring and retail advertising in the period leading up to and including
the holiday season. Additionally, advertising revenues in even-numbered years
tend to be higher as they benefit from advertising placed by candidates for
political offices and demand for advertising time in Olympic broadcasts.

RESULTS OF OPERATIONS

Three Months Ended September 30, 2003 Compared to Three Months Ended September
30, 2002

Station net revenue was down two percent from the prior year period. Political
revenue for the third quarter of 2003 was $3.3 million as compared to $6.5
million in the third quarter of 2002. Increases in local and national revenue
helped offset the lower levels of political revenue. On a category basis,
revenue from advertisers in the automotive industry was up five percent,
revenue from advertisers in the retail industry was up fourteen percent, and
revenue from advertisers in the financial industry was up thirty-four percent,
while revenue from advertisers in the grocery/drug store industry was down
approximately thirty-eight percent, year-over-year.

Operating expenses, which include amortization of program rights, were $31.8
million for the third quarter of 2003, an increase of $1.2 million over the
$30.6 million reported for the third quarter of 2002. The increase in
operating expenses is mainly attributable to increases in medical costs,
planned annual increases in employee compensation, and travel and training
costs associated with the implementation of a new traffic system for the
Companys television stations.

Corporate expenses were $3.4 million for the third quarter of 2003, a decrease
of $0.2 million from the $3.6 million reported for the third quarter of 2002.
The decrease in corporate expenses is mainly attributable lower levels of
variable compensation.

Net investment income for the third quarter of 2003 was $0.7 million. During
the third quarter of 2003, net investment income was comprised mainly of
interest earned on cash balances and notes receivable, and gains on sales from
the Companys remaining real estate portfolio.

9



---



##### 



Nine Months Ended September 30, 2003 Compared to Nine Months Ended September
30, 2002

Station net revenue was even with that of the prior year period. Political
revenue for the nine months of 2003 was $6.0 million as compared to $12.1
million in the first nine months of 2002. Increases in local and national
revenue offset the lower levels of political revenue. On a category basis,
revenue from advertisers in the automotive industry was up nine percent and the
retail industry was up six percent, while revenue from advertisers in the
grocery/drug store industry was down approximately thirty-four percent,
year-over-year.

Operating expenses, which include amortization of program rights, were $94.7
million for the first nine months of 2003, an increase of $4.7 million over the
$90.0 million reported for the first nine months of 2002. The increase in
operating expenses is mainly attributable to increases in medical costs,
planned annual increases in employee compensation, and travel and training
costs associated with the implementation of a new traffic system for the
Companys television stations.

Corporate expenses were $10.2 million for the first nine months of 2003, an
increase of $1.0 million over the $9.2 million reported for the first nine
months of 2002. The increase in corporate expenses is attributable to
increases in insurance costs, planned increases in employee compensation,
additional restricted stock amortization expense, and legal and accounting
fees.

Net investment income for the first nine months of 2003 was a loss of
approximately seventy-four thousand dollars. During the first nine months of
2003, interest earned on cash balances and notes receivable and gains on the
sale of real estate were offset by impairments taken in the Companys strategic
investment and venture capital portfolios.

Capital, Financing and Liquidity

At September 30, 2003, the Company had cash of $66.2 million and an unused line
of credit of $100 million. The Company anticipates that its primary sources of
cash, those being current cash balances, operating cash flow, and the available
line of credit will be sufficient to finance the operating requirements of its
stations and their anticipated capital expenditures, for both the next 12
months and the foreseeable future thereafter.

Cash Flows

The Companys net cash flow provided by operating activities was $42.9 million
for the first nine months of 2003 compared to $69.1 million for the same period
of the prior year. The most significant items related to the difference in
cash provided by operations between the two periods were the difference in net
income, the timing of accounts payable payments, and the receipt of payments on
notes receivable during 2002 that were not present during 2003. The Companys
net cash used in investing activities was $19.8 million for the nine month
period ended September 30, 2003, as compared to $24.7 million for the same
period of 2002. Net cash used in financing activities for the nine months ended
September 30, 2003 was $24.8 million compared to $18.9 million for the first
nine months of 2002. The increase in net cash used in financing activities is
due mainly to higher levels of share repurchase activity in the Companys stock
buy-back program during the first quarter of 2003 that was not present during
the first nine months of 2002.

New Accounting Guidance

During the first quarter of 2003, the FASB issued Interpretation No. 46
Consolidation of Variable Interest Entities, an interpretation of Accounting
Research Bulletin No. 51 Consolidated Financial Statements. The
Interpretation requires the consolidation of entities in which an enterprise
absorbs a majority of the entitys expected losses (as defined in
Interpretation No. 46), receives a majority of the entitys expected residual
returns (as defined in Interpretation No. 46), or both, as a result of
ownership, contractual or other financial interests in the entity. At this
time, the Company does not believe that Interpretation No. 46 will have a
material effect on its financial statements. The consolidation requirements of
Interpretation 46 apply immediately to variable interest entities created after
January 31, 2003. The consolidation requirements apply to older entities in the
first interim period beginning after December 15, 2003.

10



---



##### 



Forward Looking Information

The Private Securities Litigation Reform Act of 1995 provides a safe harbor
for forward-looking statements. Certain information contained herein or in any
other written or oral statements made by, or on behalf of the Company, is or
may be viewed as forward-looking. The words expect, believe, anticipate
or similar expressions identify forward-looking statements. Although the
Company has used appropriate care in developing any such forward-looking
information, forward-looking information involves risks and uncertainties that
could significantly impact actual results. These risks and uncertainties
include, but are not limited to, the following: changes in national and local
markets for television advertising; changes in general economic conditions,
including the performance of financial markets and interest rates; competitive,
regulatory, or tax changes that affect the cost of or demand for the Companys
products; and adverse litigation results. The Company undertakes no obligation
to publicly update or revise any forward-looking statements, whether as a
result of new information, future developments, or otherwise.

11



---



##### 



PART I, ITEM 4
CONTROLS AND PROCEDURES

As of the end of the period covered by this report, the Company carried out an
evaluation, under the supervision and with the participation of the Companys
management, including the Companys Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the design and operation of the Companys
disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based
upon that evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that as of the end of the period covered by this report the Companys
disclosure controls and procedures are effective in providing reasonable
assurance that material information relating to the Company required to be
included in the Companys periodic SEC filings was made known to them during
the period covered by this report. There have been no significant changes in
the Companys internal controls or in other factors that could significantly
affect internal controls subsequent to this evaluation.

12



---



##### 



PART II, ITEM 6. Exhibits and Reports on Form 8-K



| | a. |  | A list of the exhibits filed with this report is included in
the Index to Exhibits filed herewith.
| | -- |  | --------------------------------------------------------------------------------------------------
|
| | b. |  |                                                                                                   
|

| | 1. |  | The Company filed a current report on Form 8-K dated
August 5, 2003 with respect to the press release announcing its
second quarter 2003 operating results.                                                                                               
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 2. |  | The Company filed a current report on Form 8-K dated
August 5, 2003 with respect to the Company declaring a regular
quarterly dividend of $0.24 per share on its common stock,
payable on October 2, 2003 to shareholders of record on September
15, 2003.

INDEX TO EXHIBITS

|           |  |                                                                                                                             
|---------- |  | ----------------------------------------------------------------------------------------------------------------------------
|EXHIBIT 11 |  | Consolidated Earnings Per Share Computation (included in Note 5
of Notes to Consolidated and Condensed Financial Statements)
|EXHIBIT 31 |  | Rule 13a-14(a)/15d-14(a) Certifications                                                                                     
|EXHIBIT 32 |  | Section 1350 Certifications                                                                                                 

13



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##### 



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 LIBERTY CORPORATION 
(Registrant)                                                   |  | Date: November 5, 2003
|/s/ Howard L. Schrott
Howard L. Schrott
Chief Financial Officer                         |  |                       
|/s/ Martha G. Williams
Martha G. Williams
Vice President, General Counsel and Secretary |  |                       

14