LEE ENTERPRISES / 2000 Annual Report 13 Year Ended September 30,  2000 1999  1998 (In Thousands Except Per Share Data) Operating revenue: Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 276,213 $ 264,392 $ 251,384 Circulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,468 83,102 83,091 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,455 57,114 48,419 Equity in net income of associated companies . . . . . . . . . 9,377 9,238 8,367 431,513 413,846 391,261 Operating expenses: Compensation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158,884 150,462 141,261 Newsprint and ink . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,625 37,447 41,165 Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,546 13,766 12,403 Amortization of intangibles . . . . . . . . . . . . . . . . . . . . . . . 14,780 13,820 13,688 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102,211 100,982 94,845 329,046 316,477 303,362 Operating income  . . . . . . . . . . . . . . . . . . . . . 102,467 97,369 87,899 Non-operating (income) expense, net: Financial expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,643 12,863 14,611 Financial (income) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,259) (1,920) (1,896) Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (17,132) (738) – (7,748) 10,205 12,715 Income from continuing operations before taxes on income  . . . . . . . . . . . . . . . . . 110,215 87,164 75,184 Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,340 30,343 27,510 Income from continuing operations  . . . . . . . 69,875 56,821 47,674 Discontinued operations: Income from discontinued operations, net of income tax effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,738 11,152 14,559 Gain on disposition of discontinued operations, net of income tax effect  . . . . . . . . . . . . . . . . . . . . . . . . 9,050 – – 13,788 11,152 14,559 Net income  . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 83,663 $ 67,973 $ 62,233 Earnings per share: Basic: Income from continuing operations . . . . . . . . . . . . . . . $ 1.59 $ 1.29 $ 1.07 Income from discontinued operations . . . . . . . . . . . . . 0.31 0.25 0.32 Net income ......................................................... $ 1.90 $ 1.54 $ 1.39 Diluted: Income from continuing operations ................................ $ 1.58 $ 1.27 $ 1.05 Income from discontinued operations............................ 0.31 0.25 0.32 Net income ......................................................... $ 1.89 $ 1.52 $ 1.37 Lee Enterprises, Incorporated and Subsidiaries See Notes to Consolidated Financial Statements CONSOLIDATED STATEMENTS OF INCOME