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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2002

Commission File Number 0-16914

THE E. W. SCRIPPS COMPANY

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (513) 977-3000

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 o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).

Yes x No o

The aggregate market value of Class A Common Shares of the Registrant held by nonaffiliates of the Registrant, based on the $80.10 per share closing price for such stock on February 28, 2003, was approximately $2,616,000,000. As of February 28, 2003, nonaffiliates held approximately 713,000 Common Voting Shares. There is no active market for such stock.

As of February 28, 2003, there were 61,761,513 of the Registrant’s Class A Common Shares, $.01 par value per share, outstanding and 18,369,163 of the Registrant’s Common Voting Shares, $.01 par value per share, outstanding.

Certain information required for Part III of this report is incorporated herein by reference to the proxy statement for the 2003 annual meeting of shareholders.

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INDEX TO THE E. W. SCRIPPS COMPANY

ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2002

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As used in this Annual Report on Form 10-K, the terms “Scripps,” “we,” “our” or “us” may, depending on the context, refer to The E. W. Scripps Company, to one or more of its consolidated subsidiary companies, or to all of them taken as a whole.

ADDITIONAL INFORMATION

You can inspect and copy, at prescribed rates, our annual, quarterly and current reports, proxy statements and other information filed with the Securities and Exchange Commission (“SEC”) at the public reference facilities of the SEC at Room 1024, 450 Fifth Street N.W., Washington D.C. 20549. The SEC also maintains an Internet site (www.sec.gov) containing reports, proxy statements and other information. You can also inspect and copy the reports we file at the offices of the New York Stock Exchange, on which our Class A Common Shares are listed, at 20 Broad Street, New York, New York, 10005.

Copies of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available free of charge through our Internet site (www.scripps.com) as soon as reasonably practicable after we electronically file the material with, or furnish it to, the Securities and Exchange Commission.

FORWARD-LOOKING STATEMENTS

Our Annual Report on Form 10-K contains certain forward-looking statements that are based on our current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from the expectations expressed in the forward-looking statements. Such risks, trends and uncertainties, which in most instances are beyond our control, include changes in advertising demand and other economic conditions; consumers’ taste; newsprint prices; program costs; labor relations; technological developments; competitive pressures; interest rates; regulatory rulings; and reliance on third-party vendors for various products and services. The words “believe,” “expect,” “anticipate,” “estimate,” “intend” and similar expressions identify forward-looking statements. All forward-looking statements, which are as of the date of this filing, should be evaluated with the understanding of their inherent uncertainty.

PART I

ITEM 1.          BUSINESS

We are a diversified media company operating in four reportable business segments: newspaper publishing, cable and satellite television programming services (“Scripps Networks”), broadcast television and television retailing (“Shop At Home”). Licensing and other media aggregates our operating segments that are too small to warrant separate reporting, primarily syndication and licensing of news features and comics.

Newspapers include 21 daily newspapers in the U.S.

Scripps Networks includes four national television networks that are distributed by cable and satellite television systems: Home & Garden Television (“HGTV”), Food Network, Fine Living and DIY - Do It Yourself Network (“DIY”). Scripps Networks also includes our 12% interest in FOX Sports Net South, a regional television network. We have announced plans to develop a subscription-based video-on-demand service featuring the programming of our four national television networks and to develop a programming service focusing on Hispanic lifestyle and interests.

Broadcast television includes ten television stations, nine of which are affiliated with national broadcast television networks.

Newspapers, Scripps Networks, and broadcast television rely upon advertising as a primary source of revenue. Advertising comprises 70% to 75% of our total revenues.

We acquired a 70% controlling interest in Shop At Home on October 31, 2002. Shop At Home markets a range of consumer goods to television viewers and through its Internet site. Shop At Home programming is distributed under the terms of affiliation agreements with broadcast television stations and cable and satellite television systems. Substantially all of Shop At Home’s revenues are derived from the sale of merchandise.

A summary of segment information for the three years ended December 31, 2002, is set forth on page F-46 of this Form 10-K.

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Newspapers

Operations - We publish 21 daily newspapers. From our Washington bureau we operate the Scripps Howard News Service, a supplemental wire service covering stories in the capital, other parts of the United States and abroad.

A joint operating agency (“JOA”) between our Denver Rocky Mountain News (“RMN”) and MediaNews Group, Inc.’s (“MediaNews”) Denver Post (the ”Denver JOA”) was approved by the U.S. Attorney General in January 2001. The Denver Publishing Company, our wholly-owned subsidiary, received a 50% interest in the Denver JOA in exchange for the contribution of most of its assets to the Denver JOA and the payment of $60 million to MediaNews.

In addition to forming the Denver JOA, we acquired or divested the following newspaper operations in the five years ended December 31, 2002:

Excluding divested operating units and RMN revenues prior to the formation of the Denver JOA, our newspapers produced approximately 44% of our total operating revenues in 2002, down from 53% in 1998.

Our newspapers operate Internet sites focusing on local news content. The Internet sites include expanded coverage of stories in the newspapers and content that is not in the newspapers.

Many of our newspapers have introduced additional advertising services such as total-market-coverage products and direct-mail advertising. We expect continued growth in advertising revenues from such products. Certain of our daily newspapers also provide commercial printing services.

Revenues - Operating revenues for our newspapers and our share of profits of JOAs for the five years ended December 31, 2002, are presented below. Our financial statements do not include the advertising and other revenue of the Denver JOA. To enhance comparability of year-over-year results, RMN revenue prior to the formation of the Denver JOA is reported separately.

Run-of-paper (“ROP”) advertisements are included with news stories in the body of the newspaper. ROP is further broken down among “local,” “classified” and “national” advertising. Local refers to advertising that is not in the classified advertising section and is purchased by in-market advertisers. Classified refers to advertising that generally is grouped by type of advertising, e.g., automotive and help wanted. National refers to advertising purchased by businesses that operate beyond the local market and purchase advertising from many newspapers, primarily through advertising agencies.

Preprinted advertisements are generally produced by advertisers and inserted into the newspaper.

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Preprint and other advertising revenues also include advertising appearing on our newspaper Internet sites, total-market-coverage advertising and direct-mail advertising. Internet advertising ranges from simple static banners that appear at the top and bottom of a page to more complex advertisements that use animation and allow users to interact with the advertisements. Internet advertising revenues were $8.3 million in 2002, $6.5 million in 2001, $7.2 million in 2000, $4.7 million in 1999 and $1.7 million in 1998. Revenue from direct-mail, total-market-coverage and other advertising products was $19.5 million in 2002, $16.4 million in 2001, $16.4 million in 2000, $8.6 million in 1999 and $6.7 million in 1998.

A given volume of ROP advertisements is generally more profitable to us than the same volume of preprinted advertisements.

Contracts with advertisers, which are typically for one-year terms, may provide for discounted rates based upon advertising volume.

Advertising rates and revenues vary among our newspapers depending on circulation, type of advertising, local market conditions and competition. Declines in advertising spending, particularly in recessionary periods, adversely affect our business.

The first and third quarters generally have lower advertising revenues than the second and fourth quarters. Print advertising rates and volume are highest on Sundays, primarily because circulation and readership is greatest on Sundays.

Circulation revenues are derived from home-delivery sales of newspapers to subscribers and from single-copy sales made through retail outlets and vending machines.

Circulation information for our daily newspapers is as follows:

   (1)  Based on Audit Bureau of Circulation Publisher’s Statements (“Statements”) for the six-month periods ended September 30, except figures for the Naples Daily News and the Treasure Coast News/Press-Tribune which are from the Statements for the twelve-month periods ended September 30.

   (2)  This newspaper is a party to a JOA. See “Joint Operating Agencies.” The Denver JOA publishes the Rocky Mountain News and the Denver Post Monday through Friday, and a joint newspaper on Saturday and Sunday. Reported daily circulation in 2002 and 2001 represents the Monday through Friday circulation of the Rocky Mountain News. Reported circulation prior to 2001 represents the Monday through Saturday circulation of the Rocky Mountain News.

   (3)  Represents the combined daily circulation of the Stuart News, the Vero Beach Press Journal and the Ft. Pierce Tribune.

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Circulation information for the Sunday edition of our newspapers is as follows:

   (1)  Based on Audit Bureau of Circulation Publisher’s Statements (“Statements”) for the six-month periods ended September 30, except figures for the Naples Daily News, and the Treasure Coast News/Press-Tribune which are from the Statements for the twelve-month periods ended September 30.

   (2)  The Denver JOA publishes a joint newspaper on Saturday and Sunday. Reported circulation in 2002 and 2001 represents the Sunday circulation of the joint newspaper. Reported circulation prior to 2001 represents the Sunday circulation of the Rocky Mountain News. See “Joint Operating Agencies.”

   (3)  Represents the combined Sunday circulation of the Stuart News, the Vero Beach Press Journal and the Ft. Pierce Tribune.

Joint Operating Agencies - A JOA combines all but the editorial operations of two competing newspapers in a market in order to reduce aggregate expenses and take advantage of economies of scale, thereby allowing the continuing operation of both newspapers in that market. The Newspaper Preservation Act of 1970 (“NPA”) provides a limited exemption from anti-trust laws, generally permitting the continuance of JOAs in existence prior to the enactment of the NPA and the formation, under certain circumstances, of new JOAs between newspapers.

We are a partner in JOAs in four markets. The Denver JOA is jointly managed by each of the partners. We do not share management responsibilities for each of our three other JOAs.

JOA revenues less JOA expenses, as defined in each JOA, equals JOA operating profits. In each case JOA expenses exclude editorial costs and expenses. JOA operating profits are split between the partners according to the terms of the JOA agreement. We receive a 50% share of the operating profits of the Denver JOA, and between 20% and 40% of the operating profits in the other three markets. We have a residual interest in the net assets of the Albuquerque and Denver JOAs, but do not have a residual interest in the net assets of the Birmingham and Cincinnati JOAs.

Our share of JOA operating profits is reported as “Equity in earnings of JOAs and other joint ventures” in our consolidated financial statements. The related editorial costs and expenses are included in “Costs and expenses.”

The table below provides certain information about our JOAs.

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Newspaper Production - Our daily newspapers are printed using offset presses and use computer systems for writing, editing, composing and producing our newspapers. We completed construction of a new production facility for our Knoxville, Tennessee, daily newspaper in 2002 and began constructing a new production facility for our Treasure Coast newspapers in 2002.

Raw Materials and Labor Costs - We consumed approximately 141,000 metric tons of newsprint in 2002 and 140,000 metric tons in 2001. Over the past several years our newspapers have converted to a 50-inch web format. Implementation of a 50-inch web format reduced newsprint consumption by approximately 5% compared to consumption under previous web formats.

We purchase newsprint from various suppliers, many of which are Canadian. We believe our sources of supply of newsprint are adequate for our anticipated needs. Newsprint is a basic commodity and its price is sensitive to the worldwide balance of supply and demand. Because of the capital commitment to construct and operate a newsprint mill, the supply of newsprint is relatively stable except for temporary disruptions caused by labor stoppages. However, the demand for newsprint can change quickly, resulting in wide swings in its price. Newsprint prices fluctuated between $420 and $590 per metric ton from 1998 through 2002. The average newsprint price was in the lower portion of that range during the fourth quarter of 2002. Certain of our newsprint suppliers announced $50 per metric ton price increases effective March 1, 2003.

During 2002 we established Media Procurement Services (“MPS”), a wholly-owned subsidiary company. MPS provides newsprint procurement services for our newspapers and other non-affiliated newspapers. MPS provides us the ability to negotiate favorable pricing with newsprint suppliers due to increased purchasing power and by providing suppliers with improved production scheduling and more efficient newsprint delivery. We expect this to continue as the volume increases from additional clients. We receive a fee for the procurement services we provide non-affiliated newspapers.

Labor costs accounted for approximately 56% of our newspaper segment costs and expenses in 2002. Excluding RMN pre Denver JOA costs and expenses, labor costs accounted for approximately 53% of our newspaper segment costs and expenses in 2001 and 51% in 2000. A substantial number of our newspaper employees are represented by labor unions. See “Employees.”

Competition - Our newspapers compete for advertising revenues primarily with other local media, including other local newspapers, broadcast television and radio stations, cable television systems, telephone directories, other Internet sites and direct mail. Competition from electronic communications services, such as the Internet, is increasing, particularly in help-wanted, real estate and automotive classified advertising. Our newspapers offer advertisers the opportunity to distribute their message through the Internet and we continue to develop Internet initiatives designed to maintain our competitive position. Competition for advertising revenues is based upon audience size and demographics, price and effectiveness.

Our newspapers and Internet sites compete with all other information and entertainment media for consumers’ discretionary time.

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Scripps Networks

Operations - Scripps Networks includes our four national television networks, and our 12% equity interest in FOX Sports Net South, a regional sports network.

Excluding divested operating units and RMN revenues prior to the formation of the Denver JOA from total operating revenues, Scripps Networks produced approximately 27% of our total operating revenues in 2002, up from 11% in 1998.

HGTV features programming focusing on home repair and remodeling, gardening, decorating and other activities associated with the home. HGTV began telecasting in December 1994. Food Network features programming focusing on food and entertaining. Food Network began telecasting in December 1993 and we acquired a controlling interest in 1997. Fine Living, which began telecasting in March 2002, targets an upper demographic audience and advertisers in the luxury consumer goods and services markets. DIY features step-by-step instructions, in-depth demonstrations and tips on various topics associated with home improvement, gardening and crafts. DIY began telecasting in the fourth quarter of 1999.

Each of our networks operates an Internet site featuring content from its programs and additional information and products of interest to its viewers. The Internet sites also permit users to post comments in response to programs and features, and provide applications to enable users to communicate with each other and receive updates in subject areas of their choosing.

We own an approximate 70% residual interest in Food Network and an approximate 90% residual interest in Fine Living. Certain minority owners in Fine Living have the right to require us to repurchase their ownership interest beginning in 2006 at the then fair market value. We have a corresponding right to purchase the minority interest.

Approximately 87 million homes in the United States are reached by cable and satellite television systems, according to the Nielsen Homevideo Index (“Nielsen”). Certain homes may receive cable and satellite television networks from more than one source, so the number of cable and satellite television households may not represent unique homes. Information concerning the national reach of our networks is as follows:

(1)    The number of homes that receive cable television networks according to Nielsen. Fine Living and DIY are not rated by Nielsen. Homes reached for those networks represent comparable amounts as calculated by us.

As HGTV and Food Network reach full distribution our focus has turned from gaining distribution to increasing viewership. Prime time (Monday through Sunday from 8:00 pm to 11:00 pm) viewership of HGTV and Food Network has increased more than five-fold in the past five years. We believe our commitment to provide quality original programming is a key to the continued increased viewership of our networks.

We expect to increase distribution of Fine Living and DIY to approximately 20 million homes in 2003.

We joined with Time Warner Cable to launch a joint video-on-demand (“VOD”) trial in November 2001 on Time Warner digital cable homes in Cincinnati, Ohio. The initial VOD package included a total of 60 hours of programming from HGTV, Food Network and DIY. In October 2002, we announced plans to expand our VOD agreement to cover 30 Time Warner cable television systems across the United States and to Comcast’s Philadelphia cable television system. The on-demand packages in these new markets are currently offered free-of-charge. We expect to continue our efforts to develop a subscription-based VOD model.

We are also developing plans for a programming service focusing on Hispanic lifestyle and interests.

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Revenues - Operating revenues for the five years ended December 31, 2002, were as follows:

Advertising purchased on our networks primarily seeks to promote nationally recognized consumer products and brands. Advertising time on the networks is sold in both the up-front and scatter markets. The mix between the up-front and scatter markets is based upon a number of factors, including the demand for advertising time, economic conditions and pricing.

Advertising contracts generally have terms of one year or less and may guarantee the advertisements will reach a minimum audience level over the term of the contract. If the minimum audience level is not met, the advertiser will receive additional advertising time. The ability to sell advertising and the rates received are dependent primarily on the size and demographics of the audience, as well as overall demand for advertising time. Declines in advertising spending, particularly in recessionary periods, adversely affect our business.

Internet advertising primarily includes banner ads and other advertisements. Advertising opportunities on the Internet sites range from simple static banners that appear at the top and bottom of a page to more complex advertisements that use animation and allow users to interact with the advertisements. The Internet sites also provide advertisers with sponsorship opportunities, promotions, direct response campaigns and links to commercial sites. Internet advertising revenues were $6.4 million in 2002, $3.9 million in 2001, $5.1 million in 2000, $3.4 million in 1999 and $0.7 million in 1998.

The first and third quarters generally have lower advertising revenues than the second and fourth quarters.

Cable and satellite television systems generally pay a per-subscriber fee for the right to distribute our programming. Food Network’s initial distribution contracts generally provide the network to cable television systems without charge through 2003. Network affiliate fee revenues are reported net of incentives granted in exchange for long-term distribution contracts. See “Distribution.”

Programming - The cost of programming is a significant portion of our operating expenses. We both own and license the programming that airs on our networks. We have continually improved the quality and variety of programming and expanded the hours of original programming presented on our networks. The expense recognized for owned and licensed programs totaled $111.9 million in 2002, $92.4 million in 2001, $71.6 million in 2000, $46.2 million in 1999 and $30.7 million in 1998.

We transmit our programming to cable and satellite television systems via satellite. Transponder rights are acquired under the terms of long-term contracts with satellite owners.

Distribution - Our networks are distributed by cable and satellite television systems under the terms of long-term distribution contracts. We may make cash payments to cable and satellite television systems and may provide an initial period in which payment of affiliate fees by the systems is waived in exchange for such long-term distribution contracts. In markets where we have broadcast television stations, distribution of the networks may also be obtained in exchange for granting cable or satellite television systems the right to carry the local television stations’ signals.

The four largest cable and satellite television systems provide service to more than 60% of homes receiving HGTV and Food Network, while the eight largest provide service to more than 90% of such homes. The loss of distribution by any of these cable and satellite television systems would adversely affect our business. While no assurance can be given regarding renewal of our distribution contracts, we have historically successfully renewed expiring distribution agreements for HGTV and Food Network.

Competition - In addition to competing with other networks for distribution on cable and satellite television systems, we compete for advertising revenues with other local and national media, including other cable television networks, television stations, radio stations, newspapers, Internet sites and direct mail. Competition for advertising revenues is based upon audience size and demographics, price and effectiveness. We compete for consumers’ discretionary time with all other information and entertainment media.

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Broadcast Television

Operations - Broadcast television includes ten television stations, nine of which are affiliated with national broadcast television networks.

We acquired television station KMCI in Lawrence, Kansas, in 2000. We had operated the station under a Local Marketing Agreement (“LMA”) since 1996. Revenues from KMCI were included in our results of operations while the station was operated under the LMA.

Excluding divested operating units and RMN revenues prior to the formation of the Denver JOA from total operating revenues, our broadcast television stations produced approximately 20% of our total operating revenues in 2002, down from 28% in 1998.

Revenues - Operating revenues for the five years ended December 31, 2002, were as follows:

Local and national advertising refer to time purchased by local, regional and national businesses; political refers to time purchased by campaigns for elective office and campaigns for political issues. Automobile advertising accounts for approximately one-fourth of our local and national advertising revenues.

Advertising rates are dependent primarily on the size and demographics of the audience, as well as overall demand for advertising time. Declines in advertising spending, particularly in recessionary periods, adversely affect our business.

The first and third quarters of each year generally have lower advertising revenues than the second and fourth quarters. The magnitude of political advertising in even-numbered years, when congressional and presidential elections occur, makes it difficult to achieve year-over-year increases in operating results in odd-numbered years.

Our Detroit television station recently began producing a newscast and selling the advertising within the newscast for another station in the Detroit market. Certain of our stations may also manage operations for other television stations in their markets. We share the profits from these initiatives with the other stations.

Network Affiliation and Programming - Nine of our ten television stations are affiliated with national television networks. The networks offer a variety of programs to affiliated stations, which have a limited right of first refusal before such programming may be offered to other television stations in the same market. Networks sell most of the advertising within the programs and may compensate affiliated stations for carrying network programming. Affiliated television stations may share in the cost of certain network programming, which is deducted from such compensation.

In 2001, we renegotiated and extended our network affiliation agreements with NBC, which were originally scheduled to expire in 2004. Network compensation is sharply reduced under the new agreements, which expire in 2010. Our three NBC affiliates recognized $0.3 million in network compensation revenue in 2002, $1.4 million in 2001 and $2.4 million in 2000. Our ABC affiliation agreements expire in 2004 through 2006.

In addition to network programs, our television stations broadcast locally produced programs, syndicated programs, sports events, movies, public service programs and “niche” programs focusing on topics of interest in the stations’ local markets. The costs of locally produced and syndicated programming are a significant portion of broadcast television operating expenses. The price of syndicated programming is based primarily upon demand for the programming from other television stations within the market.

News is the focus of our locally produced programming. Advertising during local news programs accounts for approximately 30% of total operating revenues.

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Information concerning our stations, their network affiliations and the markets in which they operate is as follows: