A Note From the Chief Financial Officer

Fiscal Year 2005 (July 1, 2004 to June 30, 2005) was a strong one on many fronts, with substantial growth in three key areas -- financial assets, radio listenership and membership revenue -- helping WHYY to strengthen its position as a regional and national leader.

As we move into FY'06, we do so with an increase in net assets of $1.2 million. After several years of investing in our programs and services but running net deficits, this represents an extremely positive trend. Our solid financial base will help us build out our services and prepare to launch two new media platforms: a second FM channel combining news, entertainment and classical music, and a third digital television channel, one devoted exclusively to arts and culture programming.

Generous support from our community makes it possible for WHYY to sustain its mission, vision and values even as other non-profits in our region are facing institutional challenges.

We celebrated the 50th anniversary of WHYY-FM this past fiscal year, and we are pleased to report that 91FM reaches more than 500,000 listeners per week -- the highest audience in the station's history. WHYY has far surpassed the national growth rate by increasing our listenership an impressive 54 percent over the past five years. WHYY 91FM is now the 7th most-listened-to public radio station in the country, up from 11th in 2001.

At a time when many PBS stations are losing audiences, WHYY-TV experienced a 2 percent increase over last fiscal year, with more than 1.2 million households tuning in to TV12 each week. We are engaging viewers through more regional content, such as our multimedia Experience series, and capitalizing on advances in technology to offer our audiences more control over when and where they watch their favorite programs by expanding content on our digital TV channel and video on demand service.

WHYY continues to impact our community on an ever-widening array of media platforms. This fiscal year, for example, we began a weekly Radio Times podcast and launched a custom TV service at Hershey's Mill, an adult community in West Chester, Pennsylvania. Our efforts to create more and better programs and services were recognized by The Longwood Foundation, which awarded WHYY a $1 million grant to open a state-of-the-art community access bureau in Dover, Delaware, to enhance news and information and arts and culture coverage in the First State.

Equally encouraging is our steady membership growth year over year. WHYY's net membership revenue increased 3 percent in FY'05 as we continued to outpace major market stations across the country. At the same time, we are taking steps to decrease the costs associated with soliciting membership pledges and to reduce the amount of hours we devote to our quarterly on-air TV and radio membership drives.

We thank you for your support this fiscal year, and we look forward to connecting with you in new and exciting ways in the year ahead.

Bruce Flamm

Statement of Financial Position

	2005	2004
Current assets	$6,627,000	$7,012,000
Contributions receivable, less current portion	912,000	400,000
Investments	6,759,000	5,025,000
Fixed assets	13,803,000	14,845,000
Total assets	$28,101,000	$27,282,000

Current liabilities	$5,552,000	$5,789,000
Long term debt	4,294,000	4,415,000
Net assets	18,285,000	17,078,000
Total liabilities and net assets	$28,101,000	$27,282,000

Statement of Activities

Support, Contributions & Revenue

Support, contribution and revenue
	Governmental funding	$3,942,000
	Contributions	16,786,000
	Program funding and underwriting	8,679,000
	Other	1,132,000
	Total revenue	30,539,000

Expenses

Expenses
	Production and broadcasting	15,905,000
	Administration and public information	4,964,000
	Marketing and development	6,819,000
	Total expenses before depreciation	27,688,000
	Change in net assets before depreciation	2,851,000
	Less: depreciation	1,644,000
	Change in net assets	$1,207,000