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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 28, 2003

Commission file number 1-8572

TRIBUNE COMPANY
(Exact name of registrant as specified in its charter)

Registrant's telephone number, including area code: (312) 222-9100
Securities registered pursuant to Section 12(b) of the Act:

        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 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. [    ]

        Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes X     No o

        Aggregate market value of the Company's voting and non-voting common equity held by non-affiliates on June 29, 2003, based upon the closing price of the Company's Common Stock as reported on the New York Stock Exchange Composite Transactions list for such date: approximately $11,249,000,000.

        At February 20, 2004, there were 330,167,429 shares outstanding of the Company's Common Stock ($.01 par value per share), excluding 83,441,765 shares held by subsidiaries and affiliates of the Company (See Note 14 to the Company's Consolidated Financial Statements).

        The following document is incorporated by reference, in part:

        Definitive Proxy Statement for the registrant's May 12, 2004 Annual Meeting of Shareholders (Part III, to the extent described therein).

INDEX TO TRIBUNE COMPANY
2003 FORM 10-K

PART I

ITEM 1. BUSINESS.

        Tribune Company ("Tribune" or the "Company") is a media and entertainment company. Through its subsidiaries, the Company is engaged in newspaper publishing, television and radio broadcasting and entertainment. The Company was founded in 1847 and incorporated in Illinois in 1861. As a result of a corporate restructuring in 1968, the Company became a holding company incorporated in Delaware. References in this report to "the Company" include Tribune Company and its subsidiaries, unless the context otherwise indicates. The information in this Item 1 should be read in conjunction with the information contained in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations." Certain prior year amounts have been reclassified to conform with the 2003 presentation. These reclassifications had no impact on reported prior year total revenues, operating profit or net income.

        This Annual Report on Form 10-K ("Form 10-K") contains certain forward-looking statements that are based largely on the Company's current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results and achievements to differ materially from those expressed in the forward-looking statements. Such risks, trends and uncertainties, which in some instances are beyond the Company's control, include: changes in advertising demand, newsprint prices, cost of broadcast rights, interest rates, competition and other economic conditions; regulatory and judicial rulings; changes in accounting standards; adverse results from litigation or tax related proceedings or audits; the effect of labor strikes, lock-outs and negotiations; the effect of acquisitions, investments, divestitures, derivative transactions and litigation on the Company's results of operations and financial condition; and the Company's reliance on third-party vendors for various services. The words "believe," "expect," "anticipate," "estimate," "could," "should," "intend" and similar expressions generally identify forward-looking statements. Readers are cautioned not to place undue reliance on such forward-looking statements, which are being made as of the date of this filing. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Recent Developments

        On Jan. 15, 2004, subsequent to the Company's 2003 fiscal year end, the Company sold its 50% interest in La Opinión for $20 million and recorded a pretax gain of $18 million.

Significant Events

        On March 21, 2003, the Company acquired the stock of KPLR-TV, St. Louis, and the assets of KWBP-TV, Portland, Oregon, from ACME Communications for a total of $275 million. The Company acquired the stock of KPLR-TV for $200 million in cash. The acquisition of the assets of KWBP-TV was structured as a like-kind asset exchange for income tax purposes. It was funded with the remaining assets of the Denver radio station group (KKHK-FM, now known as KQMT-FM) with an estimated fair market value of $55 million, plus $20 million in cash.

Business Segments

        Previously, the Company's interactive and publishing businesses were separate reporting segments. However, as a result of various management and organizational changes, the two groups were integrated during the first quarter of 2003. Consequently, and in accordance with segment reporting guidelines, the operating results for the Company's interactive businesses are now reported as part of the operating results of the publishing segment. For comparison purposes, prior year results are also shown on this basis.

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        The Company's operations are divided into two industry segments: publishing and broadcasting and entertainment. These segments operate primarily in the United States. Certain administrative activities are not included in either segment but are reported as corporate. These segments reflect the way the Company sells its products to the marketplace and the way in which it manages operations and makes business decisions.

        The following table sets forth operating revenues and profit information for each segment of the Company (in thousands). Information pertaining to 2001 does not reflect the non-amortization provisions of Financial Accounting Standard ("FAS") No. 142, "Goodwill and Other Intangible Assets," which requires that goodwill and certain intangible assets no longer be amortized to earnings, but be reviewed periodically for impairment. See Item 7 for further discussion of the effects of FAS No. 142.

(1)

Operating profit for each segment excludes interest income and expense, equity earnings and losses, non-operating items and income taxes. Operating profit before restructuring charges is a key metric used by the Company's chief operating decision maker, as defined by Financial Accounting Standard No. 131, "Disclosures about Segments of an Enterprise and Related Information," to make decisions about resources to be allocated to a segment and assess its performance.

        The following table sets forth asset information for each industry segment (in thousands):

(1)

Corporate assets include cash and cash equivalents, marketable securities and other investments.

        The Company's results of operations, when examined on a quarterly basis, reflect the seasonality of the Company's revenues. Second and fourth quarter advertising revenues are typically higher than first and third quarter revenues. Results for the second quarter reflect spring advertising revenue, while the fourth quarter includes advertising revenue related to the holiday season. Fiscal years 2003, 2002 and 2001 each comprised 52 weeks.

2

Publishing

        The publishing segment represented 72% of the Company's consolidated operating revenues in 2003. The combined average circulation of the Company's daily newspapers was approximately 3.4 million daily copies for both of the six months ended Sept. 30, 2003 and 2002. The combined average circulation of the Company's daily newspapers was approximately 4.9 million and 4.8 million Sunday copies for the six months ended Sept. 30, 2003 and 2002, respectively. The Company's primary newspapers are Los Angeles Times, Chicago Tribune and Newsday. Other daily newspapers include South Florida Sun-Sentinel, Orlando Sentinel, The Baltimore Sun, The Hartford Courant, The Morning Call, Daily Press, The Advocate, Greenwich Time, and two Spanish language newspapers, Hoy, New York and Hoy, Chicago. The Company's publishing segment manages the websites of the Company's daily newspapers and television stations, as well as other branded sites targeting specific communities of interest. The Company also owns entertainment listings, a newspaper syndication and media marketing company, a Chicago-area cable television news channel and other publishing-related businesses.

        The Company's newspaper subsidiaries produce a wide range of niche publications in addition to their flagship products. These include community newspapers, lifestyle magazines and numerous publications devoted to the major classified advertising categories. Direct marketing, commercial printing and related services are also performed by the Company's newspaper subsidiaries. Revenues for the Company's newspaper subsidiaries and other publishing related businesses for the last three years were as follows (in thousands):

        The following table provides a breakdown of operating revenues for the publishing segment for the last three years (in thousands):

(1)

Primarily includes revenues from advertising placement services; the syndication of columns, features, information and comics to newspapers; commercial printing operations; delivery of other publications; direct mail operations; cable television news programming; distribution of entertainment listings; and other publishing-related activities.

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        The following table sets forth information concerning the Company's advertising volume for its daily newspapers (in thousands):

4

        The following table sets forth information concerning the Company's circulation for its daily newspapers (in thousands):

(1)

Circulation data based on Audit Bureau of Circulation ("ABC") averages for each of the six-month periods ended Sept. 30, 2003, 2002 and 2001.

(2)

Recognizing that advertiser and consumer demand for products and services varies by day of the week, Los Angeles, Chicago and Baltimore separate daily into two parts to provide better audience measures for advertisers. The Los Angeles Times' Thursday through Saturday ABC circulation averages for 2003, 2002 and 2001 were 996, 1,006 and 1,002, respectively. The Chicago Tribune's Wednesday through Friday ABC circulation averages for 2003, 2002 and 2001 were 681, 679 and 676, respectively. The Baltimore Sun's Wednesday through Friday ABC circulation averages for 2003, 2002 and 2001 were 301, 300 and 306, respectively.

        Each of the Company's newspapers operates independently to most effectively meet the needs of the area it serves. Local management establishes editorial policies. The Company coordinates certain aspects of operations and resources in order to provide greater operating efficiency and economies of scale.

        The Company's newspapers compete for readership and advertising with other metropolitan, suburban and national newspapers, and also with television, radio, Internet services and other media. Competition for newspaper advertising is based upon circulation levels, readership demographics, price, service and advertiser results, while competition for circulation is based upon the content of the newspaper, service and price.

        The Chicago Tribune, South Florida Sun-Sentinel, Orlando Sentinel, Daily Press, The Morning Call, The Advocate and Greenwich Time are printed in Company-owned production facilities. The Los Angeles Times, Newsday, The Baltimore Sun and The Hartford Courant are printed on Company- owned presses in production facilities leased from an affiliate (see Note 6 to the Company's consolidated financial statements in Item 8). The principal raw material is newsprint. In 2003, the Company's newspapers consumed approximately 937,000 metric tons of newsprint. Average newsprint prices increased 4% in 2003 from 2002. Average newsprint prices decreased 23% and increased 3% in 2002 and 2001, respectively.

        The Company is party to a contract with Abitibi Consolidated Inc., expiring in 2007, to supply newsprint based on market prices. Under the contract, the Company purchased 453,000 metric tons of newsprint in 2003, representing 51% of the Company's newsprint purchases. The Company has agreed to purchase 450,000 metric tons each year from 2004 to 2007, subject to certain limitations, at prevailing market prices at the time of purchase.

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Los Angeles Times

        The Los Angeles Times has been published continuously since 1881. The newspaper has won 30 Pulitzer Prizes, including three in 2003. It is published every morning and is one of the largest metropolitan newspapers in the United States in circulation. The Los Angeles market ranks second in the nation in terms of households. In its primary circulation areas of Los Angeles, Orange, Ventura, San Bernardino and Riverside counties, the Los Angeles Times competes for advertising and circulation with 16 local daily newspapers and three daily national newspapers, with its largest local competitor having approximately 307,000 average daily circulation. For the six-month period ended Sept. 2003, the Los Angeles Times ranked 4th and 3rd in the country for average daily and Sunday circulation, respectively, according to ABC. Approximately 72% and 79% of the paper's daily and Sunday circulation, respectively, was home delivered in 2003, with the remainder sold at newsstands and vending boxes.

        In addition to the daily edition covering the Los Angeles metropolitan area, the Los Angeles Times publishes daily Orange County, San Fernando Valley, Inland Empire and Ventura County editions. Daily and semi-weekly community newspapers are inserted into the paper in selected geographic areas to provide targeted local news coverage. The Los Angeles Times Communications, LLC, publisher of the Los Angeles Times, also publishes a daily national edition that is distributed primarily in Northern California, New York and Washington, D.C. The company operates latimes.com, an online version of the newspaper, which provides local, national and international news. Through its subsidiary, EZ Buy & EZ Sell Recycler Corporation, the company publishes a collection of 14 alternative classified papers in Southern California including titles such as Recycler, AutoBuys, Cycle & BoatBuys, Homes and Open Houses, Jobs and also operates recycler.com, an online version of the publications. The company owns 50% of California Independent Postal Systems ("CIPS"), which provides alternative distribution services for advertising preprints. MediaNews Group, Inc. owns the other 50% of CIPS.

Chicago Tribune

        Founded in 1847, the Chicago Tribune is published every morning and primarily serves a nine-county market in northern Illinois and Indiana. This market ranks third in the United States in number of households. The Chicago Tribune has won 23 Pulitzer Prizes, including one in 2003. For the six-month period ended Sept. 2003, the Chicago Tribune ranked 8th in average daily circulation and 5th in average Sunday circulation in the country, based on ABC averages. The Chicago Tribune's principal competitor is the Chicago Sun-Times. According to ABC, for the sixth-month period ended Sept. 2003, the Chicago Tribune had a 28% lead in total daily paid circulation and a 169% lead in Sunday paid circulation. The Chicago Tribune's total advertising volume and operating revenues are estimated to be substantially greater than those of the Chicago Sun-Times. Approximately 81% of the paper's daily and 69% of its Sunday circulation is sold through home delivery, with the remainder sold at newsstands and vending boxes.

        The Chicago Tribune is published by Chicago Tribune Company, which also operates a number of related media businesses serving Chicagoland, including the weekday RedEye edition and chicagotribune.com. Other businesses owned by Chicago Tribune Company include Tribune Direct Marketing, which provides integrated and comprehensive direct mail services; and Chicagoland Publishing Company, which publishes a number of free guides in the real estate, automotive and help wanted categories. Chicagoland Publishing oversees the monthly magazine Chicago, an award-winning combination of narrative stories about people and events in the Chicago area and service journalism focused on dining, entertainment, health and real estate. Chicago Tribune Company offers printing and delivery of other publications.

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Newsday

        Newsday, Inc.'s primary business is publishing Newsday, a morning newspaper published seven days a week, circulated primarily in Nassau and Suffolk counties on Long Island, New York, and in the borough of Queens in New York City. The New York metropolitan area ranks first among U.S. markets in terms of households. The paper has been published since 1940 and has won 17 Pulitzer Prizes. For the six-month period ended Sept. 2003, Newsday ranked 9th and 13th for average daily and Sunday circulation, respectively, in the country, according to ABC. Newsday competes with three major metropolitan newspapers and daily regional editions of several national newspapers. In addition, there are numerous daily, weekly and semiweekly local newspapers and free distribution newspapers in its distribution area. Approximately 58% of the paper's daily and 56% of its Sunday circulation is sold through home delivery, with the remainder sold at newsstands and vending boxes.

        In addition to Newsday, Newsday, Inc.'s niche publication subsidiary, Island Publications, publishes Distinction, a magazine serving Long Island's households, issued eight times per year; Long Island Parents & Children, a magazine for families, issued eight times per year; and Business LI, a joint venture with the Long Island Association, published 12 times per year. Newsday, Inc. has several websites including newsday.com and nynewsday.com, which are online versions of the newspaper. Newsday, Inc.'s subsidiary, DSA Community Publishing, operates Newport Media, a publisher of 105 pennysaver editions (zoned advertising editions) and This Week, a publisher of 73 pennysaver editions. Additionally, the results of amNewYork, a newly launched, free daily newspaper in New York City targeting young, urban commuters, are reported as a part of Newsday, Inc.

Other Newspapers

        The Company's other daily newspapers are The Baltimore Sun, South Florida Sun-Sentinel, Orlando Sentinel, The Hartford Courant, Daily Press, The Morning Call, The Advocate, Greenwich Time, and two Spanish language newspapers, Hoy, New York and Hoy, Chicago. Each of these newspapers is published every morning.

        The Baltimore Sun has published a daily newspaper since 1837 and has won 15 Pulitzer Prizes, including one in 2003. The Baltimore market ranks 17th in the United States in number of households. For the six-month period ending Sept. 2003, The Baltimore Sun was ranked 27th and 21st for average daily and Sunday circulation, respectively, in the country, according to ABC. The Baltimore Sun competes with The Washington Post in Anne Arundel and Howard counties, with The Annapolis Capital in Anne Arundel County and with The Carroll County Times in Carroll County. It also competes with regional editions of national daily newspapers, as well as other local dailies and weeklies. Approximately 79% of the paper's daily and 64% of its Sunday circulation is sold through home delivery, with the remainder sold at newsstands and vending boxes.

        The Baltimore Sun Company's subsidiaries, Patuxent Publishing and Homestead Publishing, publish 17 weekly newspapers throughout Anne Arundel, Baltimore, Carroll, Harford and Howard counties. The largest of these weekly newspapers are The Columbia Flier, The Towson Times, The Owings Mills Times and The Aegis. The Baltimore Sun also operates a website, baltimoresun.com.

        The South Florida Sun-Sentinel is the major daily newspaper serving the Broward/South Palm Beach county market, leading in both circulation and readership. The paper has been published since 1910. The Miami/Fort Lauderdale/West Palm Beach metropolitan area, which includes the Broward/South Palm Beach county area, ranks 6th in the nation in terms of households. Approximately 73% of the paper's daily and 68% of its Sunday circulation is sold through home delivery, with the remainder sold at newsstands and vending boxes.

        Sun-Sentinel Company, publisher of the South Florida Sun-Sentinel, also serves the news and information needs of South Florida through its breaking news and information website,

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sun-sentinel.com, el Sentinel, a weekly Spanish-language newspaper, weekly community newspapers, niche publications, and extensive television and radio partnerships, including its close working relationship with Tribune Broadcasting's WBZL-TV, Miami, the WB network affiliate serving South Florida. Other publications produced by Sun-Sentinel Company include City & Shore, a lifestyle magazine; City Link, an alternative weekly newspaper; Florida New Homes Guide, a bimonthly real estate magazine; and South Florida Parenting, a monthly magazine providing news and advice for family oriented audiences. Sun-Sentinel Company also offers direct mail services. Forum Publishing Group, a subsidiary of Sun-Sentinel Company, publishes a group of weekly and monthly publications, including Jewish Journal, a collection of newspapers serving South Florida's Jewish community.

        The Orlando Sentinel primarily serves a six-county area in central Florida. It is the only major daily newspaper in the Orlando market, although it competes with other Florida and national newspapers, as well as with other media. The Orlando Sentinel has been published since 1876 and has won three Pulitzer Prizes. The Orlando/Daytona Beach/Melbourne market ranks 20th among U.S. markets in terms of households. Approximately 76% of the paper's daily and 70% of its Sunday circulation is sold through home delivery, with the remainder sold at newsstands and vending boxes.

        Orlando Sentinel Communications Company, publisher of the Orlando Sentinel, also publishes US/Express, a free weekly entertainment publication used to distribute advertising to non-subscribers. In addition to its newspaper website, orlandosentinel.com, the company publishes orlandocitybeat.com and go2orlando.com, and is a partner in the local weather supersite, orlandoweather.com. The company publishes the free-distribution, weekly, bilingual newspaper, El Sentinel, and its companion website, elsentinel.com. The company's multimedia portfolio also includes several free-distribution, niche products in the central Florida market including Job Xtra, AutoFinder, apartments.com magazine and New Homes magazine. Orlando Sentinel Communications also offers commercial printing services, direct marketing/direct mail services and delivery services for other publications.

        The Hartford Courant, published every morning, is the largest and most widely read newspaper in Connecticut. It is also the oldest continuously published newspaper in the United States, having been founded in 1764. The Hartford Courant has won two Pulitzer Prizes. It is published in the state's capital, Hartford, and serves the state's northern and central regions. The Hartford/New Haven market is the 27th largest U.S. market in terms of households. Hartford Courant Company has one of the most extensive zoning operations in the country, publishing ten editions of The Hartford Courant zoned for local news and advertising. The company also operates ctnow.com, Connecticut's leading news and entertainment website, and owns two subsidiaries: New Mass. Media, Inc., a publisher of four weekly alternative newspapers in Connecticut and Massachusetts, and ValuMail, Inc., a shared-mail company that distributes advertising supplements to more than two million households in Connecticut, Massachusetts, New York and Rhode Island.

        Daily Press is published daily, including Sunday, and serves the Virginia Peninsula market. Daily Press is the only major daily newspaper in its primary market, although it competes with other regional and national newspapers, as well as with other media. The Daily Press market includes Newport News, Hampton, Williamsburg and eight other cities and counties. This market, together with Norfolk, Portsmouth and Virginia Beach, is the 41st largest U.S. market in terms of households. The Daily Press, Inc., publisher of Daily Press, also owns The Virginia Gazette, which is published twice weekly and primarily serves Williamsburg, Va. and surrounding counties. In addition, The Daily Press, Inc. owns and operates dailypress.com.

        The Morning Call, published since 1895, is the dominant regional newspaper for nine counties in eastern Pennsylvania and New Jersey. Allentown/Bethlehem/Easton is the 83rd largest U.S. market in terms of households. A group of 11 weekly newspapers, The Chronicles, is distributed with The Morning Call and also to non-subscribers across three counties in eastern Pennsylvania and New Jersey. Free publications serve recruitment and real estate markets. Subsidiaries of The Morning Call, Inc.,

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publisher of The Morning Call, offer full service direct marketing and saturation coverage through non-subscriber distribution. In addition, the company owns and operates mcall.com.

        The Advocate and Greenwich Time primarily serve the Stamford/Greenwich market in southwestern Fairfield County, Conn. The Advocate has won a Pulitzer Prize. The newspapers expanded operations in 2003 with an additional edition in neighboring Norwalk.

        The Company's Spanish language newspapers include Hoy, New York, introduced in 1998, and Hoy, Chicago, introduced in early Sept. 2003. In addition, the Company plans to introduce Hoy, Los Angeles and holahoy.com, a national Spanish language website, during the first quarter of 2004. These Spanish-language daily newspapers provide news and features of interest to Hispanics. Hoy, Chicago serves the interests of Chicago's 1.6 million Hispanics, the fourth largest Hispanic market in the United States. Hoy, New York is the second largest Spanish-language daily newspaper in the United States. Hoy, Los Angeles will serve the largest Hispanic market in the United States.

Other Publishing Related Businesses

        The Company also owns Tribune Media Services ("TMS"), which creates, aggregates and distributes news, information and entertainment content that reaches millions of users through print, online and on-screen media. The TMS Entertainment Products group creates TV and movie guide products for major media companies and consumers. TMS' print and online TV information products reach about 150 million consumers through weekly newspaper TV books, monthly cable/satellite print guides, TV information websites and new media clients. The TMS TV Week Advertising Network represents newspaper TV magazines in 42 of the top 50 U.S. markets, covering 30 million Nielsen metered households in the United States. TMS also reaches almost 9 million consumers worldwide with its cable electronic program guides. In 2003, TMS acquired the technology and patents for an interactive program guide application that be will launched in 2004 with selected consumer electronics manufacturers and cable operators.

        The TMS News and Features group creates, aggregates and represents content from more than 1,200 writers, cartoonists and publications and syndicates to more than 4,000 customers worldwide. This group is also responsible for the sales and marketing of Knight Ridder/Tribune Information Services, a joint venture between Tribune Company and Knight-Ridder, Inc. that provides text, still images and news animations to print, online and broadcast clients. TMS manages NewsCom, a joint venture between TMS and Knight Ridder, that aggregates, sells and distributes digital content from premium providers to the global media market.

        The Company also operates CLTV, a regional 24-hour cable news channel serving Chicagoland. CLTV was launched in Jan. 1993 and currently is available to more than 1.6 million cable households in the Chicago market.

Broadcasting and Entertainment

        The broadcasting and entertainment segment represented 28% of the Company's consolidated operating revenues in 2003. At Dec. 28, 2003, the segment included WB television affiliates located in New York, Los Angeles, Chicago, Philadelphia, Boston, Dallas, Washington, D.C., Atlanta, Houston, Seattle, Miami, Denver, St. Louis, Portland, Indianapolis, San Diego, Hartford, New Orleans and Albany; FOX television affiliates in Seattle, Sacramento, Indianapolis, Hartford, Grand Rapids and Harrisburg; an ABC television affiliate in New Orleans; one radio station in Chicago; the Chicago Cubs baseball team; and Tribune Entertainment, a company that develops and distributes first-run television programming for the Company's station group and national syndication.

        On March 21, 2003, the Company acquired the stock of KPLR-TV, St. Louis, and the assets of KWBP-TV, Portland, Oregon, from ACME Communications for a total of $275 million. The Company

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acquired the stock of KPLR-TV for $200 million in cash. The acquisition of the assets of KWBP-TV was structured as a like-kind asset exchange for income tax purposes. It was funded with the remaining assets of the Denver radio station group (KKHK-FM, now known as KQMT-FM) with an estimated fair market value of $55 million, plus $20 million in cash. The results of operations of KWBP-TV and KPLR-TV are included in the consolidated statements of income since their date of acquisition.

        On July 24, 2002, the Company transferred certain assets of the Denver radio station group (KOSI-FM and KEZW-AM) with a value of $125 million to Entercom Communications Corp. ("Entercom") in exchange for the assets of WTTV-TV, Indianapolis, and its satellite station, WTTK-TV in Kokomo, Indiana, which Entercom acquired from Sinclair Broadcast Group for $125 million.

        In April 2001, the Company acquired Tower Distribution (formerly United Video), WGN Cable's distribution entity, and in August 2001, the Company acquired television station WTXX-TV, Hartford, which serves the Hartford, Connecticut market.

        The following table shows sources of revenue for the broadcasting and entertainment segment for the last three years (in thousands):

(1)

Includes the following since their respective acquisition dates: KPLR-TV, St. Louis and KWBP-TV, Portland (March 2003), WTTV-TV, Indianapolis and its satellite station WTTK-TV, Kokomo, Indiana (July 2002), WTXX-TV, Hartford (August 2001) and Tower Distribution (April 2001).

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Television

        In 2003, television contributed 85% of the broadcasting and entertainment segment's operating revenues. The Company's television stations compete for audience and advertising with other television and radio stations, cable television and other media serving the same markets. Competition for audience and advertising is based upon various interrelated factors including programming content, audience acceptance and price. Selected data for the Company's television stations is shown in the following table:

(1)

Source: Nielsen Station Index (DMA Market and Demographic Rank Report, Sept. 2003). Ranking of markets is based on number of television households in DMA (Designated Market Area).

(2)

Source: Nielsen Station Index (Viewers in Profile Reports, 2003). Major over-the-air stations program for a broad, general audience and have a large viewership in the market.

(3)

See "Governmental Regulation."

(4)

In connection with the Times Mirror acquisition, the Company acquired newspapers in these markets. See "Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations—Significant Events" for a description of the Times Mirror acquisition. See "Governmental Regulation" for discussion of the Federal Communication Commission ("FCC") television/newspaper cross-ownership rule.

(5)

Founded by the Company.

(6)

The FCC has granted the Company a waiver extension to allow continued ownership of both the Miami television station and the South Florida Sun-Sentinel newspaper until the FCC has completed a review of the newspaper/television cross-ownership rule. See "Governmental Regulation" and "Item 3, Legal Proceedings" for a discussion of the cross-ownership rule.

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        Programming emphasis at the Company's stations is placed on network-provided shows, syndicated series, feature motion pictures, local and regional sports coverage, news and children's programs. These stations acquire most of their programming from outside sources, including The WB Television Network ("The WB Network") and the FOX Network, although a significant amount is produced locally or supplied by Tribune Entertainment (see "Radio/Entertainment"). WGN Cable ("WGN Superstation") programming is delivered by cable or satellite outside of Chicago and includes movies and first-run programming. Contracts for purchased programming generally cover a period of one to five years, with payment also typically made over several years. The expense for amortization of television broadcast rights in 2003 was $367 million, which represented approximately 28% of total television operating revenues.

        Average audience share information for the Company's television stations for the past three years is shown in the following table:

(1)

Represents the estimated number of television households tuned to a specific station as a percent of total viewing households in a defined area. The percentages shown reflect the average Nielsen ratings shares for the February, May, July and November measurement periods for 7 a.m. to 1 a.m. daily. Average audience share is not available for WLVI-Boston because they do not have a current contract with Nielsen. The latest contract expired in April of 2002.

(2)

Excludes cable, satellite, public broadcasting, foreign language and minor independent channels.

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        Average audience shares are shown on two bases: total market, which includes all channels, and in-market stations, which includes only the major over-the-air stations. Average in-market shares are a more relevant benchmark to determine the stations' performance in their respective markets as they compare the stations' performance to their primary programming and sales competition. In 2003, the 25 station unweighted average total market share was down slightly while the in-market share matched 2002. In 2003, most of the WB stations maintained or increased in-market share despite a dip in WB network ratings due to continued strong ratings from key syndicated programming ("Friends," "Everybody Loves Raymond," "Will & Grace"). These strong syndicated programs also helped most of the FOX stations to maintain or increase their in-market positions in 2003 despite declining FOX network ratings.

Radio/Entertainment

        In 2003, radio/entertainment operations contributed 15% of the broadcasting and entertainment segment's operating revenues. On March 21, 2003, the Company transferred the remaining assets of the Denver radio station group (KKHK-FM, now known as KQMT-FM), with an estimated fair market value of $55 million, plus $20 million in cash to ACME Communications in exchange for the assets of KWBP-TV, Portland. On July 24, 2002, the Company transferred certain assets of the Denver radio station group (KOSI-FM and KEZW-AM) with a value of $125 million to Entercom Communications Corp. in exchange for the assets of WTTV-TV, Indianapolis, and its satellite station, WTTK-TV in Kokomo, Indiana, which Entercom acquired from Sinclair Broadcast Group for $125 million. The acquisitions of the assets of KWBP-TV, WTTV-TV and WTTK-TV were structured as a like-kind asset exchange for income tax purposes. WGN-AM, Chicago is the only remaining radio station owned by the Company. Selected information for WGN-AM, Chicago is shown in the following table:

(1)

Source: Radio markets ranked by Arbitron Metro Survey Area, Arbitron Company 2003.

(2)

Source: Arbitron Company 2003.

(3)

Source: Average of Winter, Spring, Summer and Fall 2003 Arbitron shares for persons 12 years old and over, 6 a.m. to midnight daily during the period measured.

        Entertainment includes Tribune Entertainment Company ("Tribune Entertainment") and the Chicago Cubs baseball team. The Chicago Cubs were acquired in 1981. Cubs games are broadcast on WGN-TV and WGN-AM. Tribune Entertainment is the leading syndicator of first-run, hour-long action dramas ("action hours") in the United States. Tribune Entertainment syndicated the following action hours during the 2003-2004 season:

(1)

Represents seasons produced by Tribune Entertainment.

(2)

Represents future seasons Tribune Entertainment has committed to produce. Tribune Entertainment has ordered production of 2004/2005 seasons of Andromeda and Mutant X and exercised contractual options requiring its financial partner to provide funding, however, Tribune Entertainment's financial partner has commenced litigation which seeks a determination that it is not obligated to participate in the further financing or production of either series.

(3)

Currently airing re-runs of the first three seasons.

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        Action hours are generally produced with various international partners that are responsible for a significant portion of production funding. For the 2003-2004 television season, Tribune Entertainment syndicates approximately 13 hours of television shows per week, the majority of which air on the Company's 26 television stations.

        Tribune Studios, a subsidiary of Tribune Entertainment, manages the 10.5-acre studio production lot in Hollywood. Management of the site includes facilities rental of nine state-of-the art digital sound stages and associated production office space.

Investments

        The Company has investments in several public and private companies. See Note 7 to the Company's consolidated financial statements in Item 8 for further discussion of the Company's cost and equity method investments.

        The Company's principal equity method investments currently include The WB Network, CareerBuilder, Classified Ventures, TMCT I and TMCT II, TV Food Network and Comcast SportsNet Chicago. The WB Network is a growing network that provides the Company's WB affiliate television stations with original prime-time and children's programming. CareerBuilder, an online recruiting company, was formed by the Company and Knight-Ridder, Inc. in Sept. 2000. During 2001, CareerBuilder acquired Headhunter.net and, in 2002, Gannett Co., Inc. acquired a one-third interest in CareerBuilder, joining Knight-Ridder, Inc. and the Company as an equal partner. Classified Ventures is a network of automotive and real estate classified advertising websites. TV Food Network is a 24-hour cable/satellite television network focusing on food and entertaining. Comcast SportsNet Chicago is a 24-hour cable/satellite television network focusing on Chicago sports teams, which was formed in 2003 and will begin programming in fall of 2004. The Company's investments in TMCT I and TMCT II are further discussed in Note 6 to the Company's consolidated financial statements in Item 8.

Non-Operating Items

        The Company reported several non-operating items in 2003, 2002 and 2001, which included gains and losses resulting from sales of subsidiaries and investments, changes in the fair values of derivatives and related investments, write-downs of investments, insurance recoveries and income tax settlement adjustments. These non-operating items are further discussed in Note 2 to the Company's consolidated financial statements in Item 8.

Governmental Regulation

        Various aspects of the Company's operations are subject to regulation by governmental authorities in the United States.

        The Company's television and radio broadcasting operations are subject to Federal Communications Commission ("FCC") jurisdiction under the Communications Act of 1934, as amended. FCC rules, among other things, govern the term, renewal and transfer of radio and television broadcasting licenses, and limit concentrations of broadcasting control inconsistent with the public interest. Federal law also regulates the rates charged for political advertising and the quantity of advertising within children's programs. The Company is permitted to own both newspaper and broadcast operations in the Chicago market by virtue of "grandfather" provisions in the FCC regulations and in the Fort Lauderdale/Miami market by virtue of a temporary waiver of the television/newspaper cross-ownership rule.

        Because the Times Mirror acquisition in 2000 did not involve the transfer of any broadcast station licenses, FCC approval was not required to complete the transaction. Under the television/newspaper cross-ownership rule in effect at the time of the merger, companies were generally prohibited from

14

owning both a newspaper and a broadcast license in the same market. However, it was also the FCC's policy to permit newly created television/newspaper combinations to be held until the next broadcast license renewal. As such, license renewals for three Tribune television properties KTLA-TV, Los Angeles (renewal in 2006), WPIX-TV, New York (renewal in 2007) and WTIC-TV, Hartford (renewal in 2007) would be affected under the old FCC media ownership rules. On June 2, 2003, the FCC adopted new media ownership rules, including a new television/newspaper cross-ownership rule. The new rule eliminates the cross-ownership prohibition entirely in markets with nine or more television stations and permits combinations of one newspaper and one television station in markets having between four and eight television stations. Tribune complies with the new rule in each of the five markets where it owns both newspaper and television operations—New York, Los Angeles, Chicago, South Florida and Hartford. The new media ownership rules were scheduled to become effective on Sept. 4, 2003. The United States Court of Appeals for the Third Circuit has stayed the effectiveness of the new media ownership rules pending the outcome of a lawsuit filed with that Court by various public interest groups challenging the new rules. The Company filed a Petition for Review in that proceeding and in Feb. 2004, participated in oral arguments before the Third Circuit. The Company cannot predict with certainty whether the new television/newspaper cross-ownership rules will be affected by the pending litigation. If the new television/newspaper cross-ownership rule is not upheld or if other relief is not granted by the time the licenses are due for renewal, the Company will require waivers to allow continued ownership of both newspapers and broadcast licenses in the Los Angeles, Hartford and New York markets. The Company has a temporary waiver, pending the outcome of the same rulemaking proceeding, in connection with its 1997 acquisition of WBZL-TV, Miami, which is considered part of the market served by the South Florida Sun-Sentinel, published in Fort Lauderdale.

        Congress removed national limits on the number of broadcast stations a licensee may own in 1996. However, federal law continues to limit the number of radio and television stations a single owner may own in a local market, and the percentage of the national television audience that may be reached by a licensee's television stations in the aggregate. In 1999, the FCC revised its local station ownership limitations to allow, under certain conditions, common ownership of two television stations and certain radio/television combinations. On June 2, 2003, as part of the new media ownership rules noted above, the FCC raised the long-standing 35% national ownership cap to 45%. However, as noted above, the United States Court of Appeals for the Third Circuit has stayed the effectiveness of the new rules pending resolution of a lawsuit filed by public interest groups. In Jan. 2004, the national ownership cap was reduced from 45% to 39% as part of an omnibus federal spending bill. This legislation essentially renders the pending legal challenge to the national ownership cap moot. The Company cannot predict with certainty the outcome of the legal challenges to the other media ownership rules in the pending Third Circuit action. Tribune complies with the 35% national ownership cap under current rules.

        Television and radio broadcasting licenses are subject to renewal by the FCC, at which time they may be subject to petitions to deny the license renewal applications. At Dec. 28, 2003, the Company had FCC authorization to operate 26 television stations and one AM radio station.

        The FCC has approved technical standards and channel assignments for digital television ("DTV") service. DTV permits broadcasters to transmit video images with higher resolution than existing analog signals. Operators of full-power television stations have each been assigned a second channel for DTV while they continue analog broadcasts on the original channel. After the transition is complete, broadcasters will be required to return one of the two channels to the FCC and transmit exclusively in digital format. By law, the transition to DTV is to occur by Dec. 31, 2006, subject to extension under certain circumstances. Conversion to digital transmission is requiring all television broadcasters, including those owned by the Company, to invest in digital equipment and facilities. The Company does not believe that the required capital expenditures will have a material effect on its consolidated financial position or results of operations.

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        The FCC has not yet issued final regulations governing some aspects of DTV operation. These include the obligations of cable television systems and other multichannel video providers to carry DTV signals and additional "public interest" obligations that may be imposed on broadcasters' use of the digital spectrum. The FCC has adopted rules requiring broadcasters transmitting subscription-based services over the DTV channel to pay to the government fees in the amount of 5% on gross revenues collected from such services. At the end of 2003, 24 of the Company's television stations were broadcasting a digital signal in accordance with FCC rules.

        From time to time, the FCC revises existing regulations and policies in ways that could affect the Company's broadcasting operations. In addition, Congress from time to time considers and adopts substantive amendments to the governing communications legislation. The Company cannot predict what regulations or legislation may be proposed or finally enacted or what effect, if any, such regulations or legislation could have on the Company's broadcasting operations. See "Item 3, Legal Proceedings" for a discussion of pending FCC rule review.

Employees

        The average number of full-time equivalent employees of the Company in 2003 was 23,800, approximately 100 less than the average for 2002.

        During 2003, the Company's publishing segment employed approximately 20,000 full-time equivalent employees, about 18% of whom were represented by unions covered under 21 labor contracts. Contracts with unionized employees of the publishing segment expire at various times through Dec. 2007.

        The broadcasting and entertainment segment had an average of about 3,400 full-time equivalent employees in 2002, approximately 21% of whom were represented by unions covered under 22 labor contracts. Contracts with unionized employees of the broadcasting and entertainment segment expire at various times through July 2007.

Executive Officers of the Company

        Information with respect to the executive officers of the Company as of Feb. 20, 2004, is set forth below. Their ages are indicated in parenthesis. The descriptions of the business experience of these individuals include the principal positions held by them since February 1999. Unless otherwise indicated, all references to positions are to officers of the Company.

Dennis J. FitzSimons (53)
Chairman (since January 2004); Chief Executive Officer (since January 2003) and President (since July 2001); Chief Operating Officer from July 2001 until December 2002; Executive Vice President from January 2000 until July 2001; President of Tribune Broadcasting Company* until January 2003.

Jack Fuller (57)
President of Tribune Publishing Company.*

Donald C. Grenesko (55)
Senior Vice President/Finance and Administration.

David D. Hiller (50)
President of Tribune Interactive Inc.* since May 2000; Senior Vice President of Tribune Publishing Company* since February 2003; Senior Vice President/Development until May 2000.

Crane H. Kenney (41)
Senior Vice President, General Counsel and Secretary since May 2000; Vice President, General Counsel and Secretary until May 2000.

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Thomas D. Leach (43)
Vice President/Development since February 2004; Vice President and Chief Financial Officer of Tribune Broadcasting Company* from March 2001 until January 2004; Vice President/Development until February 2001.

Luis E. Lewin (55)
Senior Vice President/Human Resources since May 2000; Vice President/Human Resources until May 2000.

Patrick J. Mullen (48)
President, Tribune Broadcasting Company* since January 2003; President, Tribune Television (a division of Tribune Broadcasting Company*) from March 2001 until January 2003; Group Vice President, Tribune Television until March 2001.

Ruthellyn M. Musil (52)
Senior Vice President/Corporate Relations since February 2004; Vice President/Corporate Relations until February 2004.

*

A subsidiary of the Company

Available Information

        The Company maintains an Internet website at www.tribune.com where the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports are available without charge, as soon as reasonably practicable following the time that they are filed with or furnished to the Securities and Exchange Commission.

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ITEM 2. PROPERTIES.

        The corporate headquarters of the Company are located at 435 North Michigan Avenue, Chicago, Illinois. The general character, location and approximate size of the principal physical properties used by the Company on Dec. 28, 2003, are listed below. In total, the Company owns or leases transmitter sites, parking lots and other land aggregating approximately 1,105 acres in 98 separate locations. In addition to those properties listed below, the Company owns or leases an aggregate of approximately 2,882,000 square feet of office and production space in 309 locations. The Company also owns Wrigley Field, the 39,000-seat stadium used by the Chicago Cubs baseball team. The Company considers its various properties to be in good condition and suitable for the purposes for which they are used.

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(1)

In connection with the Times Mirror acquisition, the Company assumed several lease agreements which expire at various dates through 2011. In 1997, Times Mirror contributed eight real properties, constituting 3,025,000 square feet, to TMCT I. The Company is leasing these properties from TMCT I under a capital lease with an initial term of 12 years, which expires August 2009. See Note 6 to the Company's consolidated financial statements in Item 8 for further discussion.

(2)

Includes Tribune Tower, an approximately 630,000 square foot office building in downtown Chicago, and Freedom Center, the approximately 943,000 square foot production center of the Chicago Tribune. Tribune Tower houses the Company's corporate headquarters, the Chicago Tribune's business and editorial offices, offices of various subsidiary companies and approximately 35,000 square feet of space leased to unaffiliated tenants. Freedom Center houses the Chicago Tribune's printing, packaging and distribution operations.

ITEM 3. LEGAL PROCEEDINGS.

        The Company and its subsidiaries are defendants from time to time in actions for matters arising out of their business operations. In addition, the Company and its subsidiaries are involved from time to time as parties in various regulatory, environmental and other proceedings with governmental authorities and administrative agencies.

        In March 1997, the Company acquired Renaissance Communications Corp., a publicly traded company that owned six television stations, for $1.1 billion in cash. The stations acquired were KDAF-TV, Dallas, WBZL-TV, Miami, KTXL-TV, Sacramento, WXIN-TV, Indianapolis, WTIC-TV, Hartford and WPMT-TV, Harrisburg. The FCC granted a 12-month waiver of its rule prohibiting television/newspaper cross-ownership in the same market, which relates to the WBZL-TV, Miami television station and the South Florida Sun-Sentinel newspaper. In March 1998, the FCC granted the Company a waiver extension to allow continued ownership of both WBZL-TV, Miami and the South Florida Sun-Sentinel newspaper until the FCC's rule review has concluded. As discussed below, the new television/newspaper cross-ownership rule adopted by the FCC in June 2003 permits Tribune to own the newspapers and broadcast licenses in all of its current cross-owned markets, including South Florida. However, also as discussed below, the new television/newspaper cross-ownership rule is presently the subject of a legal challenge pending in the United States Court of Appeals for the Third Circuit. If the new television/newspaper cross-ownership rule is not upheld or if other relief is not granted, a waiver will be needed to allow continued ownership of both WBZL-TV, Miami and the South Florida Sun-Sentinel.

        In March 2000, as a result of the Times Mirror merger, the Company acquired the Los Angeles Times, Newsday, The Baltimore Sun, The Hartford Courant, The Morning Call, The Advocate, Greenwich Time and several smaller newspapers. Because the Times Mirror acquisition did not involve the transfer of any broadcast station licenses, approval of the FCC was not required to complete the transaction. Under the FCC's television/newspaper cross-ownership rule in effect at the time of the merger,

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companies were generally prohibited from owning both a newspaper and a broadcast license in the same market. However, it was also the FCC's policy to permit newly created television/newspaper combinations to be held until the next broadcast license renewal. As such, license renewals for three Tribune television properties KTLA-TV, Los Angeles (renewal in 2006), WPIX-TV, New York, (renewal in 2007) and WTIC-TV, Hartford (renewal in 2007), would be affected under the old FCC media ownership rules. If the new television/newspaper cross-ownership rule is not upheld or if other relief is not granted by the time the licenses are due for renewal, a waiver will be needed to allow continued ownership of both newspapers and broadcast licenses in the Los Angeles, New York and Hartford markets.

        In 2001, the Company received FCC authorization to operate television station WTXX-TV, Hartford. The FCC granted a so-called "failing station" waiver to allow common ownership of WTIC-TV, Hartford and WTXX-TV, Hartford. In addition, the FCC granted a temporary six-month waiver of the newspaper-broadcast ownership prohibition. The temporary waiver was extended for an additional six months in Feb. 2002, and in August 2002, the Company filed a request for a further extension. The waiver continues pending FCC action on the request for further extension. If the new television/newspaper cross-ownership rule is upheld, additional waivers will not be required to allow continued ownership of both WTIC-TV, Hartford and WTXX-TV, Hartford and The Hartford Courant.

        On June 2, 2003, the FCC adopted new media ownership rules, including a new television/newspaper cross-ownership rule. The new rule eliminates the cross-ownership prohibition entirely in markets with nine or more television stations and permits combinations of one newspaper and one television station in markets having between four and eight television stations. Tribune complies with the new rule in each of the five markets where the Company owns both newspaper and television operations—New York, Los Angeles, Chicago, South Florida and Hartford. The new media ownership rules were scheduled to become effective on Sept. 4, 2003. The United States Court of Appeals for the Third Circuit has stayed the effectiveness of the new media ownership rules pending the outcome of a lawsuit filed with that Court by various public interest groups challenging the new rules. The Company filed a Petition for Review in that proceeding and in Feb. 2004, participated in oral arguments before the Third Circuit. The Company cannot predict with certainty whether the new television/newspaper cross-ownership rule will be affected by the pending litigation.

        During 1998, Times Mirror, which was acquired by the Company in 2000, disposed of its Matthew Bender and Mosby subsidiaries in separate tax-free reorganizations. While the Company strongly believes that these transactions were completed on a tax-free basis, the Internal Revenue Service ("IRS") has audited the transactions and disagreed with the position taken by Times Mirror. In 2001, the Company received an IRS adjustment to increase Times Mirror's 1998 taxable income by approximately $1.6 billion. If the IRS prevails, the Company's federal and state income tax liability would be approximately $600 million, plus interest. As of Dec. 28, 2003, the interest on the proposed taxes would be approximately $272 million. The Company intends to vigorously defend its position and filed a petition in U.S. Tax Court on Nov. 8, 2002 to contest the IRS position. A tax reserve of $180 million, plus $56 million of interest, relating to these transactions is included in "other obligations" on the consolidated balance sheets.

        The Company does not believe that any other matters or proceedings presently pending will have a material adverse effect on its consolidated financial position, results of operations or liquidity.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

        Not applicable.

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PART II

ITEM 5. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

        The Company's common stock is presently listed on the New York, Chicago and Pacific stock exchanges. The high and low sales prices of the common stock by fiscal quarter for the two most recent fiscal years, as reported on the New York Stock Exchange Composite Transactions list, were as follows:

        At Feb. 20, 2004, there were 7,032 holders of record of the Company's common stock.

        Quarterly cash dividends declared on common stock were $.11 per share for each quarter during both 2003 and 2002. Total cash dividends declared on common stock by the Company were $136.6 million for 2003 and $133.0 million for 2002. The Company announced in Feb. 2004 that its quarterly cash dividends will be $.12 per share in 2004.

ITEM 6. SELECTED FINANCIAL DATA.

        Selected financial data for the years 1993 through 2003 is contained under the heading "Eleven Year Financial Summary" on pages 96 and 97 and is derived from financial statements for those years which were audited by PricewaterhouseCoopers LLP, independent auditors. The information contained in the "Eleven Year Financial Summary" is not necessarily indicative of the results of operations to be expected for future years, and should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Item 7 and the consolidated financial statements and related notes thereto included in Item 8 of this Form 10-K.

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ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

        The following discussion presents the significant factors that have affected the businesses of Tribune Company and its subsidiaries (the "Company") over the last three years. This commentary should be read in conjunction with the Company's consolidated financial statements and "Eleven Year Financial Summary," which are also presented in this Form 10-K. Certain prior year amounts have been reclassified to conform with the 2003 presentation. These reclassifications had no impact on reported prior year total revenues, operating profit or net income.

FORWARD-LOOKING STATEMENTS

        The discussion contained in this Item 7 (including, in particular, the discussion under "Overview," "Liquidity and Capital Resources" and "Outlook"), the information contained in Item 7A, "Quantitative and Qualitative Disclosures about Market Risk," and the information contained in the subsequent notes to the consolidated financial statements, contain certain forward-looking statements that are based largely on the Company's current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results and achievements to differ materially from those expressed in the forward-looking statements. Such risks, trends and uncertainties, which in some instances are beyond the Company's control, include: changes in advertising demand, newsprint prices, cost of broadcast rights, interest rates, competition and other economic conditions; regulatory and judicial rulings; changes in accounting standards; adverse results from litigation or tax related proceedings or audits; the effect of labor strikes, lock-outs and negotiations; the effect of acquisitions, investments, divestitures, derivative transactions and litigation on the Company's results of operations and financial condition; and the Company's reliance on third-party vendors for various services. The words "believe," "expect," "anticipate," "estimate," "could," "should," "intend" and similar expressions generally identify forward-looking statements. Readers are cautioned not to place undue reliance on such forward-looking statements, which are being made as of the date of this filing. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

OVERVIEW

        Tribune Company is a media and entertainment company that conducts its operations through two business segments: publishing and broadcasting and entertainment. These segments reflect the manner in which the Company sells its products to the marketplace and the manner in which it manages its operations and makes its business decisions. These segments operate primarily in the United States. The Company's media operations are principally in major metropolitan areas of the United States and compete against similar media and other types of media on both a local and national basis.

        The publishing segment currently consists primarily of 13 daily newspapers, which include related businesses such as interactive websites. This segment represented 72% of the Company's consolidated revenues in 2003. About 77% of this segment's revenues were derived from advertising. These revenues were generated from the sale of advertising space in published issues of the newspapers and on interactive websites. Approximately 16% of this segment's revenues were generated from the sales of newspapers to individual subscribers or to sales outlets, which re-sell the newspapers. The remaining 7% of revenues came from a variety of activities including the syndication of columns, features, information and comics to newspapers, commercial printing operations, sales of entertainment listings and other publishing-related activities.

        Publishing advertising revenues are comprised of three basic categories: retail, national and classified. Changes in advertising revenues are heavily correlated with changes in the level of economic activity in the United States. Changes in Gross Domestic Product, consumer spending, auto sales,

22

housing sales, unemployment rates, job creation, circulation levels and rates all impact demand for advertising in the Company's newspapers. The Company's advertising revenues are subject to changes in these factors both on a national level and on a local level in its markets.

        Significant expense categories for the publishing segment include compensation, newsprint & ink and other operating expenses. Compensation, which includes benefits expense, represented 42% of the publishing segment's consolidated operating expenses in 2003. Compensation expense is affected by many factors, including the level of merit increases, the number of full-time equivalent employees and changes in the design and costs of the Company's various employee benefit plans. Newsprint & ink represented 14% of the 2003 operating expenses for the publishing segment. The Company consumed approximately 937,000 metric tons of newsprint in 2003. Newsprint is a commodity and pricing can vary significantly between years. Other expenses for the segment comprised 44% of total operating expenses. These expenses are principally for the distribution of the newspaper, promotional activities and other general and administrative expenses. These expenses are typically subject to less variability.

        The broadcasting and entertainment segment currently consists of 26 television stations, one radio station, the Chicago Cubs and Tribune Entertainment, a company that develops and distributes first-run television programming. This segment represented 28% of the Company's consolidated revenues in 2003. About 82% of this segment's revenues came from the sale of advertising spots on its television stations. Changes in advertising revenues are heavily correlated with and influenced by changes in the level of economic activity in the United States. Changes in Gross Domestic Product, consumer spending levels, auto sales, programming content, audience share and rates all impact demand for advertising on the Company's TV stations. The Company's advertising revenues are subject to changes in these factors both on a national level and on a local level in the markets in which it operates.

        Significant expense categories for the broadcasting and entertainment segment include programming, compensation and other expenses. Programming expense represented 41% of the 2003 expenses in this segment. The level of programming expense is affected by the cost of programs available for purchase and the selection of programs aired by the Company's television stations. Compensation expense represented 38% of the segment's 2003 expenses and is impacted by the same factors as noted for publishing. Other expenses represented 21% of total operating expenses and are for promotional activities and other station operating expenses.

        The Company uses revenues and operating profit before restructuring charges as ways to measure the financial performance of its business segments. The Company uses average net paid circulation for its newspapers and average audience share for its television stations as a means to measure its publishing and broadcasting market shares and performance.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

        The Company's significant policies are summarized in Note 1 to the Company's consolidated financial statements in Item 8. These policies conform with accounting principles generally accepted in the United States and reflect practices appropriate to the Company's businesses. The preparation of the Company's consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. On an on-going basis, the Company evaluates its policies and estimates, including those related to income taxes, pension and postretirement benefits, broadcast rights, goodwill and other intangible assets, self-insurance liabilities, accounts receivable allowances and stock based compensation.

        Management has discussed with the Audit Committee of the Board of Directors the development, selection and disclosure of the critical accounting policies and estimates and the application of these policies and estimates. In addition, there are other items within the financial statements that require

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estimation, but are not deemed to be critical accounting policies and estimates. Changes in the estimates used in these and other items could have a material impact on the financial statements.

Income taxes

        The Company accounts for certain income and expense items differently for financial reporting purposes than for income tax reporting purposes. The Company records its tax liabilities based on estimates of the amount of taxes that will ultimately be paid. Since the Company's tax returns are subject to audit by the Internal Revenue Service ("IRS") and various states, tax liabilities are maintained for estimated federal and state audit adjustments. The Company reduced its income tax expense and liabilities by a total of $25 million in 2003 and $35 million in 2002 as a result of favorably resolving certain federal and state income tax issues.

        During 1998, Times Mirror, which was acquired by the Company in 2000, disposed of its Matthew Bender and Mosby subsidiaries in separate tax-free reorganizations. While the Company strongly believes that these transactions were completed on a tax-free basis, the IRS has audited the transactions and disagreed with the position taken by Times Mirror. In 2001, the Company received an IRS adjustment to increase Times Mirror's 1998 taxable income by approximately $1.6 billion. If the IRS prevails, the Company's federal and state income tax liability would be approximately $600 million, plus interest. As of Dec. 28, 2003, the interest on the proposed taxes would be approximately $272 million. The Company intends to vigorously defend its position and filed a petition in U.S. Tax Court on Nov. 8, 2002 to contest the IRS position. A tax reserve of $180 million, plus $56 million of interest, relating to these transactions is included in "other obligations" on the consolidated balance sheets.

        The resolutions of the Company's tax issues are unpredictable and could result in tax liabilities that are significantly higher or lower than that which has been provided by the Company.

Pension and postretirement benefits

        The Company provides defined benefit pension, postretirement health care and life insurance benefits to eligible employees under a variety of plans (see Note 13 to the Company's consolidated financial statements in Item 8). Accounting for pension and postretirement benefits requires the use of several assumptions.

        Weighted average assumptions used each year in accounting for pension benefits and other postretirement benefits are:

        The Company expects to use a long-term rate of return assumption of 8.50% in 2004, consistent with the 2003 assumption. The long-term rate of return assumption is subject to change due to the fluctuation of returns in the overall equity and debt markets. As of the date of this report, a 0.5% decrease in the Company's long-term rate of return assumption would result in a $7.7 million increase in the Company's net pension expense. In 2003, the pension plans assets earned a return of approximately 25%. The Company will use a discount rate of 6.25% for expense in 2004.

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        The Company's pension plans asset allocations at Dec. 28, 2003 and Dec. 29, 2002, were as follows (in millions):

        The Company's current 2004 target allocation for pension plans assets is 75% in equity securities and 25% in fixed income securities and other.

        At Dec. 28, 2003 and Dec. 29, 2002, the Company's prepaid pension asset included an unrecognized net actuarial loss of $774 million and $858 million, respectively. A significant portion of this net actuarial loss resulted from the difference between the Company's expected returns on plan assets and the actual losses on plan assets in 2002 and 2001. Expected returns on plan assets were $158 million and $176 million in 2002 and 2001, respectively; actual losses were $161 million and $113 million, respectively. In accordance with Financial Accounting Standard ("FAS") No. 87, "Employers' Accounting for Pensions," the actuarial loss will be recognized in net periodic pension expense over the estimated average remaining service period of active employees expected to receive benefits. The Company's policy is to incorporate asset-related gains and losses into the asset value used to calculate the expected return on plan assets and into the calculation of amortization of unrecognized net actuarial loss over a four-year period. As a result of all these factors, the Company expects to incur a net pension expense of $17 million in 2004 as compared to a net pension credit of $19 million in 2003.

        For purposes of measuring 2003 postretirement health care costs, a 9% annual rate of increase in the per capita cost of covered health care benefits was assumed for 2003. The rate was assumed to decrease gradually to 5% for 2007 and remain at that level thereafter. For purposes of measuring health care obligations at Dec. 28, 2003, a 9% annual rate of increase in the per capita cost of covered health care benefits was assumed for 2004. The rate was assumed to decrease gradually to 5% for 2008 and remain at that level thereafter. On Dec. 8, 2003, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 ("Act") was signed into law. The Company has elected the deferral allowed by FASB Staff Position FAS No. 106-1, "Accounting and Disclosure Requirements Related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003." The effects of the Act have not been reflected in the accumulated other postretirement obligations or net periodic postretirement benefit costs. Specific authoritative guidance on the accounting for the federal subsidy is pending and that guidance, when issued, could change previously reported obligations related to postretirement benefits. The Company is currently assessing the impact, if any, the Act will have on the cost of covered health care benefits.

        Assumed health care cost trend rates have a significant effect on the amounts reported for health care plans. As of the date of this report, a 1% change in assumed health care cost trend rates would have the following effects (in thousands):

        The Company plans to contribute $6 million to certain of its union and non-qualified pension plans and $17 million to its other postretirement benefit plans in 2004.

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Broadcast rights

        Broadcast rights consist principally of rights to broadcast syndicated programs, sports and feature films and are stated at the lower of cost or estimated net realizable value. The total cost of these rights is recorded as an asset and a liability when the program becomes available for broadcast. Syndicated program rights that have limited showings are generally amortized using an accelerated method as programs are aired. Sports and feature film rights are amortized using the straight-line method. At Dec. 28, 2003 and Dec. 29, 2002, the Company had a net broadcast rights asset of $649 million and $717 million, respectively.

        The Company maintains an allowance for programming that is not expected to be aired by the end of the contract period. This allowance for excess inventory is based on a program-by-program review of the Company's five-year broadcast plans and historical write-off trends. The total reserve balance at Dec. 28, 2003 and Dec. 29, 2002 was $16 million and $20 million, respectively. Actual write-offs in 2003 and 2002 were $3 million and $5 million, respectively. Future write-offs can vary based on changes in consumer viewing trends and the availability and costs of other programming.

Goodwill and other intangible assets

        At the beginning of the 2002 fiscal year, the Company adopted FAS No. 142,"Goodwill and Other Intangible Assets," which requires that goodwill and certain intangible assets no longer be amortized to earnings, but be reviewed periodically for impairment. Under FAS No. 142, the impairment review of goodwill and other intangible assets not subject to amortization must be based generally on fair values. The estimated fair values of these assets subject to the impairment review, which included goodwill, newspaper mastheads, FCC licenses and television network affiliation agreements, were calculated as of Dec. 28, 2003, Dec. 29, 2002 and Dec. 31, 2001 based on projected future discounted cash flow analyses. The development of cash flow projections used in the analyses requires the use of assumptions regarding revenue and market growth. The analyses used discount rates based on specific economic factors in the publishing and broadcasting industries. As a result of initially applying the new impairment provisions of FAS No. 142, the Company recorded a pretax charge of $271 million ($166 million after-tax, or $.50 per diluted share) in the first quarter of 2002. The charge related to certain of the Company's newspaper mastheads ($226 million), a Federal Communications Commission ("FCC") license ($43 million) and a television network affiliation agreement ($2 million), and is presented as the cumulative effect of a change in accounting principle in the Company's consolidated statements of income. The impairments were primarily the result of decreases in operating revenues compared to forecasts prepared at the dates the respective companies were acquired.

        The Company performs an impairment review of goodwill and other intangible assets not subject to amortization in the fourth quarter of each year. No adjustments to goodwill and other intangible assets not subject to amortization were required as a result of the impairment reviews conducted in the fourth quarters of 2003 and 2002. However, since the estimated fair values of these assets used in the impairment calculation are subject to change based on the Company's results and overall market conditions, future impairment charges are possible.

        Since the adoption of FAS No. 142 at the beginning of fiscal 2002, the Company has treated the intangible assets associated with network affiliation agreements as having indefinite lives and stopped recording amortization expense on these assets. In Dec. 2003, the staff of the Securities and Exchange Commission provided guidance regarding their accounting position in this area indicating that network affiliation agreements should be amortized. As a result, the Company began amortizing these assets in the fourth quarter of 2003 using a 40-year life. The Company believes the 40-year life is representative of the remaining expected useful life of the network affiliation intangibles. The provisions of FAS No. 142 require the Company to perform an impairment analysis at the time of a change in the estimated useful life of an intangible asset which was previously not being amortized. No adjustment to

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the network affiliation intangible assets was required as a result of this impairment review. In the future, the Company will no longer perform an annual test of the impairment of its network affiliation agreements under FAS No. 142, but will perform an impairment test when indicators of impairment are present, as required by FAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets."

        The Company's goodwill and other intangible assets at Dec. 28, 2003 consisted of the following (in thousands):

Self-insurance liabilities

        The Company self-insures for certain medical and disability benefits, workers' compensation costs and automobile and general liability claims. The recorded liabilities for self-insured risks are calculated using actuarial methods and are not discounted. The liabilities include amounts for actual claims, claim growth and claims incurred but not reported. Actual experience, including claim frequency and severity as well as health care inflation, could result in different liabilities than the amounts currently recorded. The recorded liabilities for self-insured risks totaled $114 million and $93 million at Dec. 28, 2003 and Dec. 29, 2002, respectively.

Accounts receivable allowances

        The Company's accounts receivable are primarily due from advertisers. Credit is extended based on an evaluation of a customer's financial condition. The Company maintains an allowance for uncollectable accounts, rebates and volume discounts. At Dec. 28, 2003 and Dec. 29, 2002, the Company's allowance for accounts receivable was $49 million and $67 million, respectively.

Stock-based compensation

        The Company accounts for its stock-based compensation plans in accordance with Accounting Principles Board ("APB") Opinion No. 25 and related Interpretations. Under APB No. 25, no compensation expense is recorded because the exercise price of employee stock options equals the market price of the underlying stock on the date of grant. A change in the Company's accounting

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method for stock-based compensation to the fair value method of FAS No. 123, "Accounting for Stock-Based Compensation," as amended by FAS No. 148, would result in additional compensation expense (see Note 1 to the Company's consolidated financial statements in Item 8).

        Under FAS No. 123, as amended by FAS No. 148, compensation cost is measured at the grant date based on the estimated fair value of the award and is recognized as compensation expense over the vesting or service period. For purposes of the disclosure required by FAS No. 123, as amended by FAS No. 148, the Company uses the Black-Scholes option-pricing model to determine the fair value of each option grant. The Black-Scholes model includes assumptions regarding dividend yields, expected volatility, expected lives and risk-free interest rates. These assumptions reflect the Company's best estimates, but these items involve inherent uncertainties based on market conditions generally outside of the control of the Company. As a result, if other assumptions had been used in the current period, pro-forma stock-based compensation, as calculated and disclosed under FAS No. 123, could have been materially impacted. Furthermore, if the Company uses different assumptions in future periods, pro-forma stock based compensation expense could be materially impacted in future years.

SIGNIFICANT EVENTS

Times Mirror Acquisition—On March 13, 2000, Tribune and Times Mirror announced the signing of a definitive agreement that provided for a merger of Times Mirror into Tribune in a cash and stock transaction. Prior to the merger, Times Mirror published the Los Angeles Times, Newsday, The Baltimore Sun, The Hartford Courant, The Morning Call, The Advocate, Greenwich Time and several smaller newspapers. The merger was effected through a two-step transaction (a cash tender offer followed by a stock for stock merger) for a total purchase price of approximately $8.3 billion, including assumption of debt and preferred stock. This transaction was accounted for as a step acquisition purchase. Tribune has consolidated Times Mirror results since the cash tender offer closed on April 17, 2000.

        Because the Times Mirror acquisition did not involve the transfer of any broadcast station licenses, FCC approval was not required to complete the transaction. Under the television/newspaper cross-ownership rule in effect at the time of the merger, companies were generally prohibited from owning both a newspaper and a broadcast license in the same market. However, it was also the FCC's policy to permit newly created television/newspaper combinations to be held until the next broadcast license renewal. As such, license renewals for three Tribune television properties KTLA-TV, Los Angeles (renewal in 2006), WPIX-TV, New York (renewal in 2007) and WTIC-TV, Hartford (renewal in 2007) would be affected under the old FCC media ownership rules. On June 2, 2003, the FCC adopted new media ownership rules, including a new television/newspaper cross-ownership rule. The new rule eliminates the cross-ownership prohibition entirely in markets with nine or more television stations and permits combinations of one newspaper and one television station in markets having between four and eight television stations. Tribune complies with the new rule in each of the five markets where it owns both newspaper and television operations—New York, Los Angeles, Chicago, South Florida and Hartford. The new media ownership rules were scheduled to become effective on Sept. 4, 2003. The United States Court of Appeals for the Third Circuit has stayed the effectiveness of the new media ownership rules pending the outcome of a lawsuit filed with that Court by various public interest groups challenging the new rules. The Company filed a Petition for Review in that proceeding and in Feb. 2004, participated in oral arguments before the Third Circuit. The Company cannot predict with certainty whether the new television/newspaper cross-ownership rules will be affected by the pending litigation. If the new television/newspaper cross-ownership rule is not upheld or if other relief is not granted by the time the licenses are due for renewal, the Company will require waivers to allow continued ownership of both newspapers and broadcast licenses in the Los Angeles, New York and Hartford markets. The Company has a temporary waiver, pending the outcome of the same rulemaking

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proceeding, in connection with its 1997 acquisition of WBZL-TV, Miami, which is considered part of the market served by the South Florida Sun-Sentinel, published in Fort Lauderdale.

Other Acquisitions—The Company completed other acquisitions totaling approximately $275 million in 2003, $162 million in 2002 and $299 million in 2001 for cash and other consideration, including the value of the Denver radio station group assets that were divested in exchange transactions during 2003 and 2002. The results of these operations are included in the consolidated statements of income since their respective dates of acquisition. None of these acquisitions were material to the Company's consolidated financial statements.

        On March 21, 2003, the Company acquired the stock of KPLR-TV, St. Louis, and the assets of KWBP-TV, Portland, Oregon, from ACME Communications for a total of $275 million. The Company acquired the stock of KPLR-TV for $200 million in cash. The acquisition of the assets of KWBP-TV was structured as a like-kind asset exchange for income tax purposes. It was funded with the remaining assets of the Denver radio station group (KKHK-FM, now known as KQMT-FM) with an estimated fair market value of $55 million, plus $20 million in cash.

        On Aug. 1, 2002, the Company acquired Chicago magazine from Primedia, Inc. for $35 million in cash. Chicago magazine, a monthly publication, serves as a reference guide for entertainment, dining, shopping and real estate for the Chicagoland area.

        On July 24, 2002, the Company transferred certain assets of the Denver radio station group (KOSI-FM and KEZW-AM) with a value of $125 million to Entercom Communications Corp. ("Entercom") in exchange for the assets of WTTV-TV, Indianapolis, and its satellite station, WTTK-TV in Kokomo, Indiana, which Entercom acquired from Sinclair Broadcast Group for $125 million. The transactions were structured as a like-kind asset exchange for income tax purposes. The divestiture of the Denver radio station group assets was accounted for as a sale, and the acquisition of WTTV-TV and WTTK-TV was recorded as a purchase. In the third quarter of 2002, the Company recorded a pretax gain of $108 million ($66 million after-tax) on the sale of the Denver radio station group assets.

        On Dec. 26, 2001, Tribune signed a contract with Entercom to manage Tribune's three Denver radio stations, KOSI-FM, KKHK-FM and KEZW-AM. On Feb. 1, 2002, under the agreement, Entercom began managing the stations for up to three years, after which, pursuant to an option agreement, Entercom would have the right to purchase the stations for $180 million. The results of the three Denver stations are included in the consolidated financial statements through Jan. 31, 2002. In Feb. 2002, the Company began receiving from Entercom a monthly time brokerage fee, which was recorded in revenue. The monthly time brokerage fee that the Company received from Entercom was reduced to reflect the sale of KOSI-FM and KEZW-AM in 2002 and KKHK-FM in 2003.

        In April 2001, the Company acquired Tower Distribution (formerly United Video), WGN Cable's distribution entity, and in August 2001, the Company acquired television station WTXX-TV, Hartford, which serves the Hartford, Connecticut market.

RESTRUCTURING CHARGES

        In the first quarter of 2002, the Company recorded pretax restructuring charges of $27.3 million ($16.7 million after-tax) for various cost reduction initiatives. Approximately 300 full-time equivalent employee positions were eliminated as a result of these initiatives. Pretax restructuring charges of $25.0 million were recorded at the publishing segment, $1.1 million at the broadcasting and entertainment segment and $1.2 million at corporate during 2002. These restructuring charges, consisting primarily of compensation expense, are presented as a separate line item in the consolidated statements of income.

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        A summary of the significant components of the pretax restructuring charges for the year ended Dec. 29, 2002, is as follows (in millions):