Good day and welcome to The New York Times third quarter 2010 earnings conference call. Today’s call is being recorded. A question-and-answer session will follow today’s presentation. (Operator Instructions). For opening remarks and introductions, I’d like to turn the call over to Ms. Paula Schwartz, Director of Investor Relations, please go ahead.

Thank you and good morning everyone. Welcome to our third quarter 2010 earnings conference call. We have several members of our senior management team here to discuss the results with you including Janet Robinson, President and CEO; Jim Follo, Senior Vice President and Chief Financial Officer; Scott Heekin-Canedy, President and General Manager of The Times and Martin Nisenholtz, Senior Vice President, Digital Operations. All comparisons on this conference call will be for the third quarter of 2010 to the third quarter of 2009, unless otherwise stated. Our discussion will include forward-looking statements and our actual results may differ from those predicted. Some of the factors that may cause them to differ are included in our 2009 10-K. Our presentation will also include non-GAAP financial measures and we have provided reconciliations to the most comparable GAAP measures in our earnings press release, which is available on our corporate website at www.nytco.com. Now, I will turn over the call to Janet.

Thank you Paula and good morning everyone. Our third quarter results demonstrate our ability to manage our business amidst both uneven economic conditions in a period of intense transition for our industry. Our print advertising trends and the stead-fast growth of our digital advertising numbers are further proof of our determination and resilience amid these circumstances. And while we have already been successful in greatly reducing our overall comps, we did continue to find ways to manage our expenses in the quarter, while maintaining our quality journalism and further investing in our digital strategy. In ending, the quarter slightly down in overall advertising revenue versus the third quarter of 2009. We have further confirmation that the path towards economic recovery will not only be a direct one, but let us not lose sight of the larger picture. We have made substantial progress so far this year and we remain confident in our long term strategy. Some of the company's actions that informed about confidence we are rigorously controlling our expenses with the 2009 cost reengineering presenting formidable comparison numbers, expanding our digital offerings such as with the launch last week of our new NY Times app for the iPad and the impending introduction of NYTimes.com pay model, continuing to keep our brand promise of high quality journalism as our very top priority, and investing in our asset portfolio to support our core operations. In the third quarter, although we experienced marketplace volatility advertisers sustained their spending levels across our products. We were able to hold the company's operating expenses to roughly flat in the third quarter overcoming the fact that 2009 saw the steepest expense cuts in our history and therefore presented very tough comparable numbers. We maintained our relevant focus on managing costs to mitigate the effects of our…

Thanks Janet, our expense controls remains solid. Operating costs were roughly flat in the quarter despite higher compensation costs and newsprint prices mostly offset by lower benefit costs and decreases in various other expenses. Getting to the special items, our third quarter earnings were unfavorably affected by $0.07 for a write down of assets at the Boston Globe's printing facility in Billerica, Massachusetts, and by $0.03 from adjustment to estimated potential withdrawal obligations under several multi-employer plans related to amended labor agreements at the Boston Globe. EPS in the third quarter of 2009, have been favorably effected by $0.02, or a gain on the sale of regional media group, real estate assets, and unfavorably effected by $0.33 related to those same estimated cost and pension withdrawal obligations, and a curtailment charge for a company sponsored plan, and by $0.08 for a tax expense from the reduction of the companies deferred tax balances as a result of lower income tax rates. Severance costs were less than $1 million, compared to $2.6 million in the third quarter of 2009. Depreciation and amortization decreased to $30 million from $31 million, and for the year, we expect depreciation and amortization to be between a $100 million and $125 million. Newsprint expense increased by 20%, primarily due to prices that were 26% higher offset in part by a 6% reduction in consumption. There were no additional East Coast newsprint price increases in the third quarter, but newsprint prices were significantly higher than in the same period last year. Newsprint prices increased steadily in the first half of the year. We believe that newsprint price variance will continue to be unfavorable on year-over-year basis in the fourth quarter. We expect high newsprint prices will negatively impact operating expense by approximately $30 million excluding a favorable impact…

Thank you. (Operator Instructions). And our first question today comes from Alexia Quadrani with JPMorgan.

First on the drop-off that you saw in September, was that broad based across your geographies and segments or was it in one particular area?

The drop-off in?

I’m sorry, in ad revenues in September.

That was characterized as a slowing of the improvement in the national categories and the improvement we’ve seen sequentially in the classified categories and about the same level of performance in the retail categories that we’ve seen in earlier quarters.

And in regards to Boston and the regionals it was just the same story in regard to national flowing in Boston, and in Florida and California we saw softness in the September number as well.

And would you say its fair just based on your comments for the fourth quarter that you’ve seen a bit of an improvement in October so far?

I think we're seeing maybe modest improvement of what we’ve seen in September and would characterize our expectations for the fourth quarter similarly. I’d add one thing to what I said a minute ago with regard to the sequential improvement. Our main magazine has shown a decided improvement each quarter through the year, improving probably 20 points from Q1 to Q2 and then from Q2 to Q3. So magazine schedules are on a different spending schedules and our newspaper and I think that there is perhaps some significances to that.

And then on sort of unrelated question, I was surprised to see the classified autos still weak in the quarter. Was there I guess one area driving that or was that pretty broad based too?

We saw a slowing of advertising. The improvement we've seen in advertising throughout the year and it seems to be tied very directly to the fall off in advertising in automotive sales that started in August and continued through September I believe.

And then sort of I guess a bigger picture question probably for Janet. I guess if you are looking across your performance across all your segments. Where do you continue to see real cyclical weakness, meaning is there one area that is particularly depressed because the economic cycle where you would expect to see the more dramatic recovery, whether its in 2011 or longer term.

I think that you know from a standpoint in California and Florida, we're seeing weakness in those particular areas particularly in Florida in regard to real estate. I think that many of those would have hoped to see much more of a real estate rebound center than certainly now. And it continues to be a very weak category for all of our papers down there, so I would point to California and Florida as particularly weak areas. I think certainly with our digital performance, we are seeing good strong growth in regard to what we see with the new applications that are being introduced and that is a bright spot for us , not only in regard to New York but we are seeing that in Boston as well, and we are seeing good digital growth at our regional newspapers as well.

And our second question today comes from Craig Huber with Access 342.

Can you update us on your status on your pension given the actions that you guys have done so far this year and I have some follow-ups?

Well, as you know, we came into the year with an unfunded qualified plan of something north of $400 million. We did make a discretionary contribution in the early part of our second quarter, about $80 million. So that certainly went towards improving the funded status, that being said, really through kind of mid-summer into the equity markets who are not cooperative. We are generating material returns, and interest rates have obviously not gone favorably, rates continue to come down. So that’s had a negative impact as well. But now the funded status has improved, I think the equity performance of last month or so have contributed to that. So, while the funded status is lower, the interest rates have not been helpful.

And then also Janet, you talked about in your press release and your commentary about modest improving, you are expecting for newspaper ad revenues. During the fourth quarter you obviously reported negative 1.7% in the latest quarter here. Can you just talk a little bit further about what you have seen in October, but is October trending better than that negative 1.7% or no? Also what you’re expecting for November and December, your backlog here of advertising is making you feel you can get better than negative 1.7% for the whole quarter?

Well, I don’t think we can be that specific in regard to what we see because visibility is very limited as you know Craig, but we are seeing improvement in October and we have strong booking in November and in December. This is the strongest quarter usually for us in regard to particularly retail advertising, but we are seeing many national schedules certainly be committed to as well. I think that we were clear that we’ve got very big comps to be compared too in regard to the fourth quarter last year, but we feel as though there will be modest improvement in print that digital will be about 10% up and that of course from a comps perspective we are going to be continuing to work on the cost side of our business to make sure that indeed we keep our costs in line and hopefully do an even better job than just keeping them in line. We also have several T Magazines in the fall in the fourth quarter. We have a brand new editor in Sally Singer, who has been a favorite of many advertisers and we feel as though and from her order on T will be a very important move for us, that will I think be something to watch going forward.

And can you talk a little further about this up 5.5% number in about.com’s revenues this latest quarter? It’s just obviously a meaning full slowdown from the first half of the year, obviously a tougher comparison, but what are you sort of expecting that particular segment for the fourth quarter?

As you pointed out, on the CPC side actually we are comping against very tough numbers in Q3 of ‘09, but in addition we implemented an important mandated change by Google in the way we display our CPC ad units which affected click-through rates in the quarter. So these two factors combined to significantly affect CPC in the quarter, I should add that display had a strong quarter though it softened some what toward the back half as the uneven economy affected the business And I should also add that we’ve seen continued softness in October in both CTC and display advertising at About, but it’s a bit too early to call the fourth quarter. As you know, from the outset our ambition has been to diversify revenues at About.com and to focus on building a significant display sales team there. We’ve done that, we moved off the business, the business was almost entirely CTC and now we are quite diverse in terms of the revenue streams. So that effort continues, that’s why we made a modest investment in the quarter in terms of the trade advertising program that we rolled out, as well as the addition of some sales talent in the group. So we continue to focus very much on the display part of the business.

And then lastly Jen if I could, on your Boston Globe paper, how much did you see on average, the newspaper advertising rate is down year-over-year and the same question for your regionals? Thank you.

From a yield perspective it’s a modest decline. I think that the Globe is doing a very good job of diversifying its revenue base by bringing in a great deal more of digital advertising, but also focusing very much in regard to high rate line business, particularly on the national front.

That similar for the regionals, a modest decline?

In the regional it’s a modest decline in regard to yield, yes. From a perspective of the regionals in regard to the times I think that Scott can give you an overview.

We’ve got positive improvement in our rate yield and that’s attributable to I believe the customized programs that we do with our advertisers, include color and position. Also where they fall in the rate card and their contracts, so improvement in yields.

Like roughly 1% or so,

Few percentage points.

Few percent okay.

We will go next to John Janedis with UBS.

Two questions please, one is someone commented on this already but the print only comp is a lot tougher into the fourth quarter. Your guidance clearly suggests some good underlying strength in the business. I am just hoping you can talk through maybe what you are seeing in some of those key categories and are you seeing any kind of meeting [political] dollars in printer online?

Not meaningful [political] dollars at the Times in print. We expect the categories that have been strong throughout for us for most of the year has continued to be strong in the fourth quarter and particularly second half of the year luxury, hotel, corporate, tech we are to a point we are up against some difficult comps kind of varied by category where they have on the quarter financial services is up against some very difficult comps in fourth quarter. Others categories in December, in particularly when we started to see the beginnings of economic recovery last year. But on total we believe that the categories that have been showing the strength will continue into the fourth quarter.

I would just say for the Globe in regards political Boston.com does benefit from political advertising online and there is a heated race in Boston so they are garnering more political advertising online.

And just related to that, on the auto front, you did mention auto, in one word or another, is that just a middle link category at least a national not that it’s a big category for you, but what are you seeing there?

I was scared categorize it as a middle link category. It’s been growing very nicely through the year as I said, and so the industry saw the drop-off in their sales but we expect it to recover pretty quickly hopefully by the end of the quarter and we expect it to see some strength carrying into the new year as they advertise and support new products.

And then just on about the earlier comment. After a big ramp, margins there declined somewhat, Martin is this the beginning of a trend here and is that Google change going to impact you for the next three quarters? Thanks.

To some extent it will, yes. I think we should expect more modest growth on the CPC side for the next few quarters, but the team is very focused on continuing to get as much out of the CPC businesses as possible. And there is no reason to think that we won’t be able to strengthen that somewhat. In fact, I think we've seen in the last couple of weeks affirming up a strengthening of the category, but that cycling through will take place through the next three quarters as you point out.

I would also reiterate that Martin's earlier comment about the display in the investment that we've made in the display team and we continue to make, not only in bodies but in expertise that indeed we've done very well with the display growth this year. And with the fourth quarter being an important quarter for many categories, display can give us an opportunity to show more growth.

We'll take our next question from Edward Atorino with Benchmark.

I got a couple of questions for Jim. On interest expense, it sounds like there's going to be a big jump in the fourth quarter with interest expense to get to your total for the year. Am I hearing it right, number one? And number two on operating cost both for the fourth quarter and looking into 2011, a lot of new things going on, can you sort of absorb that in your normal cost plans or will these be additive costs going forward, the new products, the new online stuff, all that nice (inaudible) news stuff, imagine its costing some money.

Yes, look on the online side; I think the incremental costs are manageable within our regular core business. I don’t think that’s really a factor. Obviously newsprint prices going into next year and until we comp through a lot of these price increases that will be an increased cost. I think Janet made the point earlier. We will continue to be aggressive on costs and find ways to offset that as we did in the third and the fourth quarter. We found ways to absorb some of those higher newsprint prices. So, we are very focused on managing those costs. I think we’ve given some conservative guidance on interest rates and I am not trying much more here beyond that.

Could you hold costs flat 2011 versus 2010?

We're just deeply in the middle of our planning season. I’d rather not make any commitments at this point.

And we'll go next to Doug Arthur with Evercore.

Three quick questions. Jim, do you have the headcount at the end of the quarter?

I do. It’s somewhere around 7,500, it’s about 4% down year-over-year and about the same on a year-to-date basis.

And then the bump up in SG&A year-over-year in the third quarter is that due to the pay roll [expense]?

It’s more comp related, again the pay wall has contributed some amounts in the quarter and all others have gone the other way, and it’s not a material number and it's probably less than $5 million for the quarter. Yes, and some of that, parts of the conversation I referred to earlier will reverse itself in the fourth quarter as well. But it’s some variable comp in the way we look up variable comp that's largely driven that number.

Then finally on National advertising it was up for almost 5% for the quarter, but you discussed a fall off in September, is there any way you could break it up by the month?

National was quite strong in July, both double digits. Couple of points below that in August and just may be a point of growth in September.

And we'll take a follow-up question from John Janedis with UBS.

Just one quick housekeeping question, is that the third quarter share count a good run rate?

Yes, it should be.

What was the reason for that ramp down Jim, do you know offhand?

It's basically share price driven. When options and some of the warrants related to the [inverse] of transaction of share price driven.

Was it the loan effect?

With some of the pressure our share price has been under has driven that number down.

We will go next to Craig Huber with Access 342.

I do have a follow-up Janet; you mentioned two months ago you rolled out a payroll on your butcher paper outside of Boston. I believe that newspaper is roughly 70,000 daily circulation; I'm curious can you quantify how many people are now paying for access to that website for roughly two months?

It’s a little early to call, but first and foremost we are on plan. We're serving all of our commitments to our advertisers, which is very good news and traffic is responding as we anticipated, with the exception that unique users are actually up. We are pretty pleased to be honest Craig in regard to the work that’s been done and how the circulation and subscription revenue is transpiring up there. There’s lots of learning, needless to say that's going on that we will share with our entire organization, but it’s a little early to give specifics in regard to where we are. But we're very pleased in regards to be being on plan and in some cases above plans.

And my last question, online help wanted revenue for your company in the quarter, what's the percent change there please?

It was about flat, Craig.

1% up.

And this concludes today's question-and-answer session.

Thank you very much; if you have any additional questions please give us a call.