content_image/286169.jpg content_image/286168.jpg content_image/286167.jpg
## Operating Costs 

Operating costs were as follows: 

<img src='content_image/286169.jpg'>

The components of operating costs as a percentage of total operating costs were as follows: 

<img src='content_image/286168.jpg'>

The components of operating costs as a percentage of total revenues were as follows: 

<img src='content_image/286167.jpg'>

## Production Costs 

Production costs increased in 2014 compared with 2013 primarily due to higher wages and benefits (approximately $25 million), offset in part by lower raw materials expense (approximately $4 million). Newsprint expense declined 5.5% in 2014 compared with 2013, with 4.1% from lower consumption and 1.4% from lower pricing. Compensation costs increased mainly due to hiring related to strategic initiatives. 

Production costs decreased in 2013 compared with 2012 primarily due to lower raw materials expense (approximately $13 million), mainly newsprint, outside printing costs (approximately $9 million) and pension expense (approximately $3 million), offset in part by higher compensation costs (approximately $4 million). Newsprint expense declined 16.2% in 2013, with 9.8% from lower consumption and 6.4% from lower pricing. Cost savings from contract negotiations mainly contributed to lower outside printing costs. Compensation costs increased 

