Form 11-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 


 

FORM 11-K

 


 

FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS

AND SIMILAR PLANS PURSUANT TO SECTION 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

(Mark One):

x ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2004

 

or

 

¨ TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from              to             

 

Commission file number V-1799

 


 

A. Full title of the plan and the address of the plan, if different from that of the issuer named below:

 

MG ADVANTAGE 401(k) PLAN

 

B. Name of the issuer of the securities held pursuant to the plan and the address of its principal executive office:

 

MEDIA GENERAL, INC.

333 East Franklin Street

Richmond, Virginia 23219

 



Financial Statements

And Supplemental Schedule

 

MG Advantage 401(k) Plan

 

Years ended December 31, 2004, and 2003,

with Report of Independent Registered Public Accounting Firm


MG Advantage 401(k) Plan

 

Financial Statements

and Supplemental Schedule

 

Years ended December 31, 2004, and 2003

 

Table of Contents

 

Report of Independent Registered Public Accounting Firm

   1

Financial Statements

    

Statements of Net Assets Available for Plan Benefits

   2

Statements of Changes in Net Assets Available for Plan Benefits

   3

Notes to Financial Statements

   4-6
     Schedule

Supplemental Schedule

    

Schedule of Assets (Held at End of Year), December 31, 2004

   A


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

Administrator

MG Advantage 401(k) Plan

 

We have audited the accompanying statements of net assets available for plan benefits of the MG Advantage 401(k) Plan (the Plan), as of December 31, 2004 and 2003, and the related statements of changes in net assets available for plan benefits for the years then ended. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Plan’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

 

In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Plan at December 31, 2004 and 2003, and the changes in its net assets available for plan benefits for the years then ended, in conformity with U.S. generally accepted accounting principles.

 

Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets (held at end of year) as of December 31, 2004, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This supplemental schedule is the responsibility of the Plan’s management. The supplemental schedule has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.

 

/s/ Ernst and Young LLP

 

June 6, 2005

Richmond, Virginia

 

1


MG Advantage 401(k) Plan

 

Statements of Net Assets Available for Plan Benefits

 

     December 31,

     2004

   2003

Assets

             

Cash

   $ 4,643,550    $ 4,991,302

Investments

     252,407,723      234,557,823
    

  

Total Assets

     257,051,273      239,549,125
    

  

Net assets available for plan benefits

   $ 257,051,273    $ 239,549,125
    

  

 

See accompanying notes.

 

 

2


MG Advantage 401(k) Plan

 

Statements of Changes in Net Assets Available for Plan Benefits

 

     Years Ended December 31,

 
     2004

    2003

 

Additions:

                

Investment income:

                

Interest & dividends

   $ 3,964,343     $ 3,583,272  

Net realized and unrealized appreciation in fair value of investments

     7,750,594       28,891,548  
    


 


       11,714,937       32,474,820  
    


 


Contributions:

                

Employer

     7,884,543       7,491,790  

Participants

     14,137,913       13,150,122  

Rollovers

     842,696       663,036  
    


 


       22,865,152       21,304,948  
    


 


Total Additions

     34,580,089       53,779,768  

Deductions:

                

Distributions to withdrawing participants

     (17,077,941 )     (12,768,618 )
    


 


Net increase in net assets available for plan benefits

     17,502,148       41,011,150  

Net assets available for plan benefits at beginning of year

     239,549,125       198,537,975  
    


 


Net assets available for plan benefits at end of year

   $ 257,051,273     $ 239,549,125  
    


 


 

See accompanying notes.

 

 

3


MG Advantage 401(k) Plan

 

Notes to Financial Statements

 

December 31, 2004

1. General

 

Fidelity Management Trust Company (Fidelity) is the trustee, recordkeeper, and investment manager of the MG Advantage 401(k) Plan (the Plan), pursuant to a trust agreement dated January 1, 2001. The investment fund options include twelve Fidelity funds, a Dreyfus Corporation fund, and the Media General Stock Fund.

 

2. Significant Accounting Policies

 

Basis of Accounting

 

The financial statements of the Plan are prepared on the accrual basis of accounting.

 

Valuation of Investments

 

All investments, other than loans to participants, are carried at market value. Loans to participants are carried at the original amount of the loan less repayments received which approximates market value. Investments in securities traded on national securities exchanges are valued at the last reported sales price or at the last reported bid quotation if not traded on that day. Investments in commingled equity and balanced funds are valued at their redemption value. Dividends are recorded on the ex-dividend date and interest is accrued as earned

 

The Plan invests in various investment securities. Investment securities are exposed to various risks such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the statements of net assets available for Plan benefits.

 

Use of Estimates

 

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from these estimates.

 

Reclassifications

 

Certain prior year amounts have been reclassified to conform to the current year’s presentation.

 

3. Contributions

 

Effective April 1, 2004, the Plan’s allowable pretax contributions by means of regular payroll deductions increased from 20% to 30% of a participant’s total compensation subject to limitations prescribed by the Internal Revenue Code. After-tax contributions are not allowed. The Company matches 100% of contributions up to 4% of a participant’s total pay. Participants may rollover account balances from a prior employer’s qualified retirement plan or “conduit” IRA that holds only prior qualified plan balances. Participant contributions are invested in accordance with Plan terms directed by participants in the fourteen fund investment options mentioned in Note 1. Company matching contributions are initially invested in Company stock, subject to transfer provisions discussed in the following paragraph. The Plan also includes, among other things, a loan feature (see Note 7). Under specified guidelines, a participant may request the trustee to transfer a portion of the participant’s balance in other funds into a loan account for disbursement as a loan to the participant. Repayment of principal and interest is generally made by payroll deduction and the loans are fully secured by the participant’s account balance.

 

4


MG Advantage 401(k) Plan

 

Notes to Financial Statements (continued)

 

3. Contributions (continued)

 

Participants may change their investment elections directly with Fidelity at any time. Participants over age 55 may also transfer 100% of the market value of their account among all fund options. Participants under age 55 may transfer 100% of the market value of their account among all fund options, except from the Media General Common Stock Fund, at any time. These participant transfers from the Media General Common Stock Fund are limited to 25% of the participant’s fund balance once a quarter to any of the other funds.

 

4. Eligibility, Vesting, Withdrawals, and Terminations

 

Any employee who has completed 45 days of service and is at least 18 years old shall be eligible to participate in the Plan as of the first day of the month following their meeting these eligibility requirements. In the event of termination of employment or withdrawal from the Plan, participants receive the total value of their account either directly or by rollover to another qualified account. The vesting provisions of the Plan provide for immediate 100% vesting of the value of Company pretax matching contributions.

 

The Company has established the Plan with the intention that it will continue. The Company has the right at any time to terminate the Plan. The value of the participants’ accounts would be distributed to the participants in a manner consistent with the Summary Plan Document.

 

The above descriptions are provided for informational purposes. Readers should refer to the most recently updated Summary Plan Document for more complete information on Plan provisions both before and after the noted Plan changes.

 

5. Income Taxes

 

The Internal Revenue Service ruled on February 27, 2003 that the Plan qualifies under Section 401(a) of the Internal Revenue Code (IRC) as of January 1, 2002, and, therefore, the related trust is not subject to tax under present income tax law. Employee contributions qualify as “cash or deferred” contributions under Section 401(k) of the IRC. Once qualified, the Plan is required to operate in conformity with the IRC to maintain its qualification. The Company believes the Plan continues to qualify under the IRC and the related trust is tax exempt.

 

6. Investments

 

Investments representing five percent or more of the Plan’s net assets at December 31, 2004 and 2003 consisted of the following:

 

     2004

   2003

Name and Title


   Cost

   Market Value

   Cost

   Market Value

Media General, Inc. Common Stock Fund

   $ 65,866,449    $ 113,138,526    $ 62,338,660    $ 115,651,826

Fidelity Managed Income Portfolio Fund

     21,217,483      21,217,483      19,958,751      19,958,751

Fidelity Fund

     33,640,806      33,193,084      34,738,733      32,135,202

Fidelity Freedom 2010

     14,261,625      14,967,138      13,324,568      13,457,171

Fidelity Growth Company

     13,107,241      15,379,219      10,915,377      11,779,337

 

5


MG Advantage 401(k) Plan

 

Notes to Financial Statements (continued)

 

6. Investments (continued)

 

The Plan’s investments appreciated (depreciated) in fair value during 2004 and 2003 as follows:

 

Name and Title


   2004

    2003

 

Media General, Inc. Common Stock Fund

   $ (126,456 )   $ 9,739,954  

Fidelity Fund

     2,012,031       6,797,753  

Fidelity Growth Company

     1,572,846       3,023,693  

Fidelity OTC Portfolio

     311,769       1,033,197  

Fidelity Diversified International

     925,071       924,341  

Fidelity Freedom Income

     52,491       94,754  

Fidelity Freedom 2000

     28,987       62,136  

Fidelity Freedom 2010

     632,887       1,547,701  

Fidelity Freedom 2020

     629,595       1,172,821  

Fidelity Freedom 2030

     571,837       1,040,879  

Fidelity Freedom 2040

     207,078       391,471  

Fidelity International Bond

     (16,872 )     (5,766 )

Dreyfus Small Company Value

     949,330       3,068,614  
    


 


     $ 7,750,594     $ 28,891,548  
    


 


 

7. Loans to Participants

 

The Plan has a loan feature available to all Plan participants. Loans are made from the participant’s account, reducing the investment balance and creating a receivable in the Loan Fund. Loans are secured by the participant’s vested account balance. Loans to terminated participants and loans in default are treated as distributions to the participant. Loans are generally repaid through payroll deduction including principal and interest. The principal portion reduces the receivable from participants and both principal and interest are transferred to the participant’s investment account as repayments are received.

 

Participants may obtain loans based on the vested value of their accounts. New loans cannot exceed 50% of the participant’s account value or a maximum of $50,000 in accordance with the Department of Labor’s regulations on loans to participants. Loans are limited to one loan per participant per twelve-month period with a maximum of two loans outstanding at any one time. Loans shall bear a reasonable rate of interest and must be repaid over a period not to exceed 5 years unless used to purchase the participant’s primary residence, in which case the loan must be repaid over a period not to exceed 10 years.

 

8. Related Party Transactions

 

Recurring administrative expenses of the Plan, which include trustee fees, are paid by Media General, Inc. Administrative expenses for the years ended December 31, 2004 and 2003 were approximately $243,000 and $266,000, respectively.

 

6


Supplemental Schedule


Schedule A

 

MG Advantage 401(k) Plan

 

EIN: 54-0850433    Plan: 001

 

Schedule H, Line 4 (i)

 

Schedule of Assets (Held at End of Year) **

 

December 31, 2004

 

Identity of Issue, Borrower,

Lessor, or Similar Party


   Description of
Investment including
Maturity date, rate of
interest, par or
maturity value


   Current or
Market Value


Interest-bearing Cash

   $ 4,643,550 units    $ 4,643,550

Fidelity* Managed Income Portfolio

     21,217,483 shares      21,217,483

Fidelity* Fund

     1,110,880 shares      33,193,084

Fidelity* Growth Company

     274,286 shares      15,379,219

Fidelity* International Bond

     98,628 shares      1,037,567

Fidelity* OTC Portfolio

     141,348 shares      4,903,373

Fidelity* Diversified International

     233,006 shares      6,673,277

Fidelity* Freedom Income

     299,255 shares      3,372,717

Fidelity* Freedom 2000

     107,231 shares      1,295,347

Fidelity* Freedom 2010

     1,098,909 shares      14,967,138

Fidelity* Freedom 2020

     708,372 shares      9,888,874

Fidelity* Freedom 2030

     536,911 shares      7,559,711

Fidelity* Freedom 2040

     311,852 shares      2,579,020

Dreyfus Small Company Value

     341,055 shares      8,765,112

Media General, Inc.* Common Stock Fund

     1,745,555 shares      113,138,526

Loans to participants*

     4% - 10%      8,437,275
           

Total

          $ 257,051,273
           


* Party in interest to the Plan
** Historical cost is not required as all investments are participant directed.


EXHIBIT INDEX

 

TO

 

FORM 11-K FOR

 

MG ADVANTAGE 401(k) PLAN

 

Exhibit Number


  

Description of Exhibit


23    Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm, dated June 20, 2005


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

MEDIA GENERAL, INC.

(Registrant)

By:

 

/s/ J. Stewart Bryan III


   

J. Stewart Bryan III

   

Chairman and Chief

Executive Officer

By:

 

/s/ Marshall N. Morton


   

Marshall N. Morton

   

Vice Chairman, Chief

Financial Officer and Director

 

Date: June 22, 2005