CBS Corporation Reports Second Quarter 2008 Results

Revenues Up 1% to $3.4 Billion

NEW YORK, July 31 /PRNewswire-FirstCall/ -- CBS Corporation (NYSE: CBS.A
and CBS) today reported results for the second quarter ended June 30, 2008.
"The media business is changing and CBS Corporation is changing along with
it, to enable us to expand the reach of our world-class content to fast-
growing areas such as the interactive marketplace," said Sumner Redstone,
Executive Chairman, CBS Corporation. "I am very confident that Leslie and his
team are effectively operating our Company to prevail in the current market
environment, while positioning CBS to thrive over the long term."
"We've taken key steps to position our asset portfolio for superior long-
term growth," said Leslie Moonves, President and Chief Executive Officer, CBS
Corporation. "During the quarter, we completed our acquisition of CNET
Networks, which we believe will add at least two percentage points to our
revenue and profit growth rates going forward, in addition to being accretive
to earnings and free cash flow in 2008. We also closed on our acquisition of
IOA, the largest outdoor business in the vibrant South American market. Both
of these growing businesses exemplify our strategy to increase our presence in
the areas of highest potential. At the same time, we have taken this
opportunity to change our portfolio by initiating a plan to divest 50 mid-size
market radio stations. By selling selected stations in these markets we can
focus on the larger market stations, many of which are showing growth."
Moonves continued: "In a more difficult economic environment, with our
local businesses affected by an advertising slowdown, we have taken aggressive
cost reduction actions to manage expenses. Since the beginning of the year,
well before the current softness in the marketplace, we have been working to
rationalize the cost structure in our Television, Radio and Outdoor
businesses. When the marketplace comes back, we will be well prepared to
capitalize on that upturn."
"Finally, I'm pleased that we have maintained our ability to grow revenues
and generate strong free cash flow of more than $1.4 billion in the first half
of 2008, up 6% over the first half of 2007," Moonves added. "Free cash flow
is an extremely important way that we measure our success. It has enabled us
to raise our dividend again during the quarter - the sixth time since the
start of 2006. This is our way of demonstrating confidence in our ability to
keep generating healthy free cash flow, and our commitment to returning value
to shareholders."
Second Quarter 2008 Results
Revenues of $3.39 billion for the second quarter of 2008 increased 1% from
the same quarter in 2007, due to strong growth in syndication revenues, as a
result of the new international self-distribution arrangement for the CSI
franchise and higher international syndication sales, as well as revenue
growth at Outdoor, partially offset by lower local advertising sales at
television and radio stations.
Operating income before depreciation and amortization ("OIBDA") of $760.4
million and operating income of $637.0 million for the second quarter of 2008
decreased 12% and 15%, respectively, from the same prior-year period. On an
adjusted basis, OIBDA for the second quarter of 2008 decreased 10% to $802.1
million and operating income decreased 13% to $678.7 million principally
reflecting lower advertising sales partially offset by higher profits from
syndication sales. Adjusted results exclude stock-based compensation expense
and restructuring charges. Stock-based compensation expense for the second
quarter of 2008 was $39.1 million versus $30.5 million for the same quarter
last year.
Net earnings increased 1% to $408.4 million for the second quarter of 2008
from $404.0 million for the same quarter last year, and diluted earnings per
share increased 11% to $.61 in 2008 from $.55, due to the gain on the sale of
the Company's investment in Sundance Channel and lower shares outstanding
resulting from 2007 share repurchases. On an adjusted basis, net earnings for
the second quarter of 2008 were $355.3 million, or $.53 per diluted share,
versus $419.4 million, or $.57 per diluted share, for the same prior-year
period. Adjusted results exclude stock-based compensation expense,
restructuring charges and dispositions.
Free cash flow for the second quarter of 2008 was $464.2 million, down
from $570.5 million for the same prior-year period, due to higher working
capital and capital spending.
On June 30, 2008, the Company completed the acquisition of CNET Networks,
Inc. ("CNET") for $1.8 billion in cash. The Company is combining its existing
interactive businesses, which are currently reported in the Television
segment, with those of CNET, to create an expanded CBS Interactive business
unit. Beginning in the third quarter of 2008, the Company will report a
separate Interactive segment and prior period results will be reclassified to
conform to the new presentation.
The Company today also announced its intention to divest approximately 50
of its radio stations in several mid-size markets. Management intends to use
the value received from the divestiture to reduce its shares outstanding.
First Half 2008 Results
Revenues of $7.05 billion for the first half of 2008 increased $15.1
million from the same prior-year period. Results were positively affected by
higher syndication revenues as a result of the new international self-
distribution arrangement for the CSI franchise and higher domestic and
international syndication sales, higher affiliate revenues, and revenue growth
at Outdoor, partially offset by the absence of the 2007 telecast of Super Bowl
XLI on CBS Network and lower local advertising sales at television and radio
stations.
OIBDA of $1.40 billion and operating income of $1.16 billion for the first
half of 2008 decreased 6% and 9%, respectively, from the same prior-year
period. On an adjusted basis, OIBDA for the first half of 2008 decreased 2%
to $1.52 billion from $1.55 billion for the same prior-year period and
operating income decreased 3% to $1.28 billion from $1.32 billion, driven by
lower advertising sales partially offset by higher profits from syndication
sales. Adjusted results exclude stock-based compensation expense and $47.5
million of restructuring charges incurred during the first half of 2008.
Stock-based compensation expense was $72.2 million for the first six months of
2008 versus $51.5 million for the same prior-year period.
Net earnings for the first half of 2008 increased 6% to $652.7 million
from $617.5 million for the same prior-year period, and diluted earnings per
share increased 17% to $.97 from $.83, primarily reflecting the gain on the
sale of the Company's investment in Sundance Channel and lower shares
outstanding resulting from 2007 share repurchases. On an adjusted basis, net
earnings of $646.7 million for the first half of 2008 decreased from $685.7
million for the same prior-year period. Adjusted diluted earnings per share,
however, increased 4% to $.96 from $.92 for the prior-year period due to the
impact of 2007 share repurchases. Adjusted results exclude stock-based
compensation expense, restructuring charges and dispositions.
Free cash flow of $1.40 billion for the first half of 2008 increased 6%
from $1.32 billion for the same prior-year period, primarily due to lower cash
taxes.
Business Outlook
The Company expects OIBDA growth to be in the low single digits for 2008
and operating income to be comparable to the prior year, from growth of
between 3% and 5%, due to recent softness in the U.S. economy and its effects
on the Company's local businesses. The Company's 2008 business outlook
excludes the effects of the acquisition of CNET, which the Company expects
will add to OIBDA growth in 2008. The outlook also excludes stock-based
compensation expense, restructuring charges and the impact of acquisitions and
divestitures.
Consolidated and Segment Results
The tables below present the Company's revenues, OIBDA and operating
income by segment for the three and six months ended June 30, 2008 and 2007
(dollars in millions). Reconciliations of all non-GAAP measures to reported
results have been included at the end of this earnings release.

Three Months Ended Six Months Ended
June 30, Better/ June 30, Better/
Revenues 2008 2007 (Worse)% 2008 2007 (Worse)%
Television $2,201.1 $2,163.0 2% $4,798.7 $4,736.0 1%
Radio 416.4 463.4 (10) 779.9 860.9 (9)
Outdoor 598.1 554.2 8 1,095.0 1,016.5 8
Publishing 186.0 200.3 (7) 387.6 429.6 (10)
Eliminations (7.9) (6.0) (32) (13.4) (10.3) (30)
Total Revenues $3,393.7 $3,374.9 1% $7,047.8 $7,032.7 -%

Three Months Ended Six Months Ended
June 30, Better/ June 30, Better/
OIBDA 2008 2007 (Worse)% 2008 2007 (Worse)%
Television $495.6 $549.5 (10)% $945.1 $948.5 -%
Radio 158.6 187.3 (15) 280.9 351.7 (20)
Outdoor 153.6 168.3 (9) 255.1 268.5 (5)
Publishing 17.0 20.1 (15) 34.1 43.9 (22)
Corporate (41.9) (41.6) (1) (67.9) (68.4) 1
Residual costs (22.5) (24.2) 7 (44.9) (48.3) 7
Total OIBDA $760.4 $859.4 (12)% $1,402.4 $1,495.9 (6)%

Three Months Ended Six Months Ended
June 30, Better/ June 30, Better/
Operating Income 2008 2007 (Worse)% 2008 2007 (Worse)%
Television $446.8 $506.1 (12)% $848.9 $856.2 (1)%
Radio 150.7 179.4 (16) 265.7 336.2 (21)
Outdoor 92.4 115.3 (20) 136.5 162.3 (16)
Publishing 14.6 18.1 (19) 29.2 39.5 (26)
Corporate (45.0) (44.8) - (74.2) (74.7) 1
Residual costs (22.5) (24.2) 7 (44.9) (48.3) 7
Total Operating
Income $637.0 $749.9 (15)% $1,161.2 $1,271.2 (9)%

Television (CBS Television Network, CBS Television Stations, CBS Paramount
Network Television, CBS Television Distribution, Showtime Networks and CBS
College Sports Network)
Television revenues for the second quarter of 2008 increased 2% to $2.20
billion from $2.16 billion for the same prior-year period. Television
license fees rose 35%, driven by higher syndication sales as a result of both
the new international self-distribution arrangement for the CSI franchise and
higher international syndication sales. Affiliate revenues increased 5% due
to rate increases and subscriber growth at Showtime Networks and CBS College
Sports Network. Television advertising revenues declined 6% due to softness
in the local television station advertising market and lower primetime
ratings, partially offset by the timing of the Semifinals of the NCAA Men's
Basketball Tournament, which aired in the second quarter of 2008 versus the
first quarter of 2007.
Television OIBDA decreased 10% to $495.6 million and operating income
decreased 12% to $446.8 million for the second quarter of 2008 primarily due
to lower advertising sales partially offset by higher profits from syndication
sales, principally from the CSI franchise, and higher affiliate revenues.
Television results included stock-based compensation expense of $18.4 million
and $14.8 million for the second quarter of 2008 and 2007, respectively.
Radio (CBS Radio)
Radio revenues decreased 10% to $416.4 million from $463.4 million for the
same prior-year period, reflecting weakness in the radio advertising market
and the impact of radio station divestitures. On a same station basis, Radio
revenues declined 9% from the second quarter of 2007.
Radio OIBDA and operating income for the second quarter of 2008 decreased
15% to $158.6 million and 16% to $150.7 million, respectively, due to lower
advertising sales and the absence of profits from divested stations partially
offset by lower employee-related expenses and marketing and promotion costs as
a result of restructuring and cost-saving initiatives. Radio results included
stock-based compensation expense of $5.6 million and $5.0 million for the
second quarter of 2008 and 2007, respectively.
Outdoor (CBS Outdoor)
Outdoor revenues for the second quarter of 2008 increased 8% to $598.1
million from $554.2 million for the same prior-year period reflecting growth
in both International and North America. International (which is composed of
Europe, Asia and South America) was up 18%, led by the impact of fluctuations
in foreign exchange rates, strength in the U.K. and France, and the
acquisition of International Outdoor Advertising Group ("IOA"). Revenues in
North America (which is composed of the United States, Canada and Mexico) were
up 2%. Revenues were negatively affected by the non-renewal of two major
municipal contracts in Toronto and San Francisco, which reduced North America
revenue growth by 2% for the quarter. In constant dollars, Outdoor revenues
increased 4% from last year's second quarter.
Outdoor OIBDA and operating income decreased 9% to $153.6 million and 20%
to $92.4 million, respectively, for the second quarter of 2008 driven by
declines in North America. North America OIBDA decreased 12% to $126.7
million and operating income decreased 18% to $79.7 million due to higher
transit and billboard lease costs, the aforementioned non-renewal of municipal
contracts and $2.6 million of restructuring costs incurred in the second
quarter of 2008. International OIBDA increased 9% to $26.9 million driven by
the revenue growth offset largely by higher transit costs. International
operating income declined 29% to $12.7 million due to higher depreciation
expense associated with recent capital expenditures. Outdoor results included
stock-based compensation expense of $2.0 million and $1.2 million for the
second quarter of 2008 and 2007, respectively.
On April 23, 2008, the Company acquired IOA, the leading out-of-home
advertising company in South America, for $111.6 million.
Publishing (Simon & Schuster)
Publishing revenues for the second quarter of 2008 declined 7% to $186.0
million from $200.3 million for the same prior-year period, as best-selling
titles in the second quarter of 2008, including The Broken Window by Jeffery
Deaver and Chasing Harry Winston by Lauren Weisberger, did not match
contributions from prior year titles which included Blaze by Stephen King
writing as Richard Bachman, and The Secret by Rhonda Byrne.
Publishing OIBDA and operating income decreased 15% to $17.0 million and
19% to $14.6 million, respectively, with lower revenues partially offset by
lower royalty expenses. Publishing results included stock-based compensation
expense of $1.2 million and $.9 million for the second quarter of 2008 and
2007, respectively.
Corporate
Corporate expenses before depreciation expense were $41.9 million for the
second quarter versus $41.6 million for the same prior-year period. Corporate
expenses included stock-based compensation expense of $11.9 million and $8.6
million for the second quarter of 2008 and 2007, respectively.
Residual Costs
Residual costs primarily include pension and postretirement benefits costs
for benefit plans retained by the Company for previously divested businesses.
Residual costs decreased to $22.5 million for the second quarter of 2008 from
$24.2 million for the same prior-year period.
Interest Expense
Interest expense of $134.3 million for the second quarter of 2008
decreased from $145.5 million for the same prior-year period primarily due to
lower interest rates.
Interest Income
Interest income of $15.2 million for the second quarter of 2008 decreased
from $33.8 million for the same prior-year period reflecting lower interest
rates and lower average cash balances as a result of 2007 share repurchases.
Other Items, Net
Other items, net, for the second quarter and first half of 2008 include a
pre-tax gain of $127.2 million on the sale of the Company's investment in
Sundance Channel.
Provision for Income Taxes
The Company's effective income tax rate for the second quarter was 36.2%
for 2008 versus 36.4% for 2007.
About CBS Corporation
CBS Corporation (NYSE: CBS.A and CBS) is a mass media company with
constituent parts that reach back to the beginnings of the broadcast industry,
as well as newer businesses that operate on the leading edge of the media
industry. The Company, through its many and varied operations, combines broad
reach with well-positioned local businesses, all of which provide it with an
extensive distribution network by which it serves audiences and advertisers in
all 50 states and key international markets. It has operations in virtually
every field of media and entertainment, including broadcast television (CBS
and The CW - a joint venture between CBS Corporation and Warner Bros.
Entertainment), cable television (Showtime Networks and CBS College Sports
Network), local television (CBS Television Stations), television production
and syndication (CBS Paramount Network Television and CBS Television
Distribution), radio (CBS Radio), advertising on out-of-home media (CBS
Outdoor), publishing (Simon & Schuster), interactive media (CBS Interactive),
music (CBS Records), licensing and merchandising (CBS Consumer Products),
video/DVD (CBS Home Entertainment), in-store media (CBS Outernet) and motion
pictures (CBS Films). For more information, log on to www.cbscorporation.com.
Cautionary Statement Concerning Forward-looking Statements
This news release contains both historical and forward-looking statements.
All statements, including Business Outlook, other than statements of
historical fact are, or may be deemed to be, forward-looking statements within
the meaning of section 27A of the Securities Act of 1933 and section 21E of
the Securities Exchange Act of 1934. These forward-looking statements are not
based on historical facts, but rather reflect the Company's current
expectations concerning future results and events. Similarly, statements that
describe our objectives, plans or goals are or may be forward-looking
statements. These forward-looking statements involve known and unknown risks,
uncertainties and other factors that are difficult to predict and which may
cause the actual results, performance or achievements of the Company to be
different from any future results, performance or achievements expressed or
implied by these statements. These risks, uncertainties and other factors
include, among others: advertising market conditions generally; changes in the
public acceptance of the Company's programming; changes in technology and its
effect on competition in the Company's markets; changes in the Federal
Communications laws and regulations; the impact of piracy on the Company's
products, the impact of the consolidation in the market for the Company's
programming; other domestic and global economic, business, competitive and/or
other regulatory factors affecting the Company's businesses generally; the
impact of union activity, including possible strikes or work stoppages or the
Company's inability to negotiate favorable terms for contract renewals; and
other factors described in the Company's news releases and filings with the
Securities and Exchange Commission including but not limited to the Company's
most recent Form 10-K. The forward-looking statements included in this
document are made only as of the date of this document, and under section 27A
of the Securities Act and section 21E of the Exchange Act, we do not have any
obligation to publicly update any forward-looking statements to reflect
subsequent events or circumstances.

CBS CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited; all amounts, except per share amounts, are in millions)

Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007

Revenues $3,393.7 $3,374.9 $7,047.8 $7,032.7

Operating income 637.0 749.9 1,161.2 1,271.2

Interest expense (134.3) (145.5) (273.0) (285.3)
Interest income 15.2 33.8 32.8 73.1
Other items, net 124.9 4.3 124.7 2.8
Earnings before income taxes 642.8 642.5 1,045.7 1,061.8

Provision for income taxes (232.9) (233.7) (384.2) (437.9)
Equity in loss of investee
companies, net of tax (1.2) (4.9) (8.4) (6.8)
Minority interest, net of tax (.3) .1 (.4) .4
Net earnings $408.4 $404.0 $652.7 $617.5

Basic net earnings per common share $.61 $.56 $.98 $.84

Diluted net earnings per common share $.61 $.55 $.97 $.83

Weighted average number of
common shares outstanding:
Basic 669.4 720.8 668.7 738.6
Diluted 674.3 729.4 674.0 747.2

Dividends per common share $.27 $.22 $.52 $.44

CBS CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited; Dollars in millions)

At June 30, At December 31,
2008 2007

Assets
Cash and cash equivalents $813.9 $1,346.9
Receivables, net 2,668.0 2,678.0
Programming and other inventory 635.7 971.9
Prepaid expenses and other current assets 1,116.0 1,034.1
Total current assets 5,233.6 6,030.9
Property and equipment 4,863.4 4,683.4
Less accumulated depreciation and amortization 1,836.1 1,761.9
Net property and equipment 3,027.3 2,921.5
Programming and other inventory 1,413.3 1,548.5
Goodwill 20,134.3 18,452.0
Intangible assets 9,943.5 10,081.3
Other assets 1,495.8 1,396.0
Total Assets $41,247.8 $40,430.2

Liabilities and Stockholders' Equity
Accounts payable $364.3 $352.3
Participants' share and royalties payable 942.4 612.5
Program rights 781.8 1,009.7
Current portion of long-term debt 16.7 19.1
Accrued expenses and other current liabilities 2,595.2 2,411.0
Total current liabilities 4,700.4 4,404.6
Long-term debt 7,072.7 7,068.6
Other liabilities 7,545.4 7,483.1
Minority interest 2.1 1.5
Stockholders' equity 21,927.2 21,472.4
Total Liabilities and Stockholders' Equity $41,247.8 $40,430.2

CBS CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited; Dollars in millions)

Six Months Ended
June 30,
2008 2007

Operating activities:
Net earnings $652.7 $617.5
Adjustments to reconcile net earnings to
net cash flow provided by operating activities:
Depreciation and amortization 241.2 224.7
Stock-based compensation 72.2 51.5
Equity in loss of investee companies,
net of distributions 14.2 11.8
Minority interest, net of tax .4 (.4)
Change in assets and liabilities,
net of effects of acquisitions 641.7 624.9
Net cash flow provided by operating activities 1,622.4 1,530.0
Investing activities:
Acquisitions, net of cash acquired (1,886.2) (309.6)
Capital expenditures (220.2) (206.6)
Investments in and advances to investee companies (18.2) (43.8)
Purchases of marketable securities (20.8) -
Proceeds from sales of marketable securities 10.0 -
Proceeds from dispositions 360.4 305.6
Net (payments to) receipts from Viacom Inc.
related to the Separation (2.9) 212.2
Other, net (10.8) (.8)
Net cash flow used for investing activities (1,788.7) (43.0)
Financing activities:
Borrowings from (repayments to) banks,
including commercial paper, net (4.0) 1.9
Payment of capital lease obligations (9.4) (8.2)
Proceeds from issuance of notes - 678.0
Repayment of notes - (660.0)
Purchase of Company common stock (44.7) (1,602.1)
Dividends (343.2) (313.9)
Proceeds from exercise of stock options 31.2 131.7
Excess tax benefit from stock-based compensation 3.4 7.8
Net cash flow used for financing activities (366.7) (1,764.8)
Net decrease in cash and cash equivalents (533.0) (277.8)
Cash and cash equivalents at beginning of period 1,346.9 3,074.6
Cash and cash equivalents at end of period $813.9 $2,796.8

CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
(Unaudited; Dollars in millions)

Operating Income Before Depreciation and Amortization

The following tables set forth the Company's Operating Income before
Depreciation and Amortization ("OIBDA") for the three and six months ended
June 30, 2008 and 2007. The Company defines OIBDA as net earnings adjusted to
exclude the following line items presented in its Statements of Operations:
Minority interest, net of tax; Equity in loss of investee companies, net of
tax; Provision for income taxes; Other items, net; Interest income; Interest
expense; and Depreciation and amortization.
The Company uses OIBDA, among other things, to evaluate the Company's
operating performance, to value prospective acquisitions and as one of several
components of incentive compensation targets for certain management personnel,
and this measure is among the primary measures used by management for planning
and forecasting of future periods. This measure is an important indicator of
the Company's operational strength and performance of its business because it
provides a link between profitability and operating cash flow. The Company
believes the presentation of this measure is relevant and useful for investors
because it allows investors to view performance in a manner similar to the
method used by the Company's management, helps improve their ability to
understand the Company's operating performance and makes it easier to compare
the Company's results with other companies that have different financing and
capital structures or tax rates. In addition, this measure is also among the
primary measures used externally by the Company's investors, analysts and
peers in its industry for purposes of valuation and comparing the operating
performance of the Company to other companies in its industry.
Since OIBDA is not a measure of performance calculated in accordance with
generally accepted accounting principles ("GAAP"), it should not be considered
in isolation of, or as a substitute for, net earnings as an indicator of
operating performance. OIBDA, as the Company calculates it, may not be
comparable to similarly titled measures employed by other companies. In
addition, this measure does not necessarily represent funds available for
discretionary use, and is not necessarily a measure of the Company's ability
to fund its cash needs. As OIBDA excludes certain financial information
compared with net earnings, the most directly comparable GAAP financial
measure, users of this financial information should consider the types of
events and transactions which are excluded. The Company provides the
following reconciliations of total OIBDA to net earnings and OIBDA for each
segment to such segment's operating income, the most directly comparable
amounts reported under GAAP.

CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
(continued)
(Unaudited; Dollars in millions)

Three Months Ended June 30, 2008

Depreciation Operating
OIBDA and Amortization Income (Loss)
Television $495.6 $(48.8) $446.8
Radio 158.6 (7.9) 150.7
Outdoor 153.6 (61.2) 92.4
Publishing 17.0 (2.4) 14.6
Corporate (41.9) (3.1) (45.0)
Residual costs (22.5) - (22.5)
Total $760.4 $(123.4) $637.0

Three Months Ended June 30, 2007

Depreciation Operating
OIBDA and Amortization Income (Loss)
Television $549.5 $(43.4) $506.1
Radio 187.3 (7.9) 179.4
Outdoor 168.3 (53.0) 115.3
Publishing 20.1 (2.0) 18.1
Corporate (41.6) (3.2) (44.8)
Residual costs (24.2) - (24.2)
Total $859.4 $(109.5) $749.9

Three Months Ended June 30,
2008 2007
Total OIBDA $760.4 $859.4
Depreciation and amortization (123.4) (109.5)
Operating income 637.0 749.9
Interest expense (134.3) (145.5)
Interest income 15.2 33.8
Other items, net 124.9 4.3
Earnings before income taxes 642.8 642.5
Provision for income taxes (232.9) (233.7)
Equity in loss of investee companies,
net of tax (1.2) (4.9)
Minority interest, net of tax (.3) .1
Net earnings $408.4 $404.0

CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
(continued)
(Unaudited; Dollars in millions)

Six Months Ended June 30, 2008

Depreciation Operating
OIBDA and Amortization Income (Loss)
Television $945.1 $(96.2) $848.9
Radio 280.9 (15.2) 265.7
Outdoor 255.1 (118.6) 136.5
Publishing 34.1 (4.9) 29.2
Corporate (67.9) (6.3) (74.2)
Residual costs (44.9) - (44.9)
Total $1,402.4 $(241.2) $1,161.2

Six Months Ended June 30, 2007

Depreciation Operating
OIBDA and Amortization Income (Loss)
Television $948.5 $(92.3) $856.2
Radio 351.7 (15.5) 336.2
Outdoor 268.5 (106.2) 162.3
Publishing 43.9 (4.4) 39.5
Corporate (68.4) (6.3) (74.7)
Residual costs (48.3) - (48.3)
Total $1,495.9 $(224.7) $1,271.2

Six Months Ended June 30,
2008 2007
Total OIBDA $1,402.4 $1,495.9
Depreciation and amortization (241.2) (224.7)
Operating income 1,161.2 1,271.2
Interest expense (273.0) (285.3)
Interest income 32.8 73.1
Other items, net 124.7 2.8
Earnings before income taxes 1,045.7 1,061.8
Provision for income taxes (384.2) (437.9)
Equity in loss of investee companies,
net of tax (8.4) (6.8)
Minority interest, net of tax (.4) .4
Net earnings $652.7 $617.5

CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
(continued)
(Unaudited; Dollars in millions)

Free Cash Flow
Free cash flow reflects the Company's net cash flow from operating
activities less capital expenditures. The Company uses free cash flow, among
other measures, to evaluate its operating performance. Management believes
free cash flow provides investors with an important perspective on the cash
available to service debt, make strategic acquisitions and investments,
maintain its capital assets, satisfy its tax obligations and fund ongoing
operations and working capital needs. As a result, free cash flow is a
significant measure of the Company's ability to generate long term value. It
is useful for investors to know whether this ability is being enhanced or
degraded as a result of the Company's operating performance. The Company
believes the presentation of free cash flow is relevant and useful for
investors because it allows investors to view performance in a manner similar
to the method used by management. In addition, free cash flow is also a
primary measure used externally by the Company's investors, analysts and peers
in its industry for purposes of valuation and comparing the operating
performance of the Company to other companies in its industry.
As free cash flow is not a measure of performance calculated in accordance
with GAAP, free cash flow should not be considered in isolation of, or as a
substitute for, net earnings as an indicator of operating performance or net
cash flow provided by operating activities as a measure of liquidity. Free
cash flow, as the Company calculates it, may not be comparable to similarly
titled measures employed by other companies. In addition, free cash flow does
not necessarily represent funds available for discretionary use and is not
necessarily a measure of the Company's ability to fund its cash needs. As
free cash flow deducts capital expenditures from net cash flow provided by
operating activities, the most directly comparable GAAP financial measure,
users of this financial information should consider the types of events and
transactions which are not reflected. The Company provides below a
reconciliation of free cash flow to net cash flow provided by operating
activities, the most directly comparable amount reported under GAAP.
The following table presents a reconciliation of the Company's net cash
flow provided by operating activities to free cash flow:

Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
Net cash flow provided by
operating activities $595.6 $682.0 $1,622.4 $1,530.0
Less capital expenditures 131.4 111.5 220.2 206.6
Free cash flow $464.2 $570.5 $1,402.2 $1,323.4

The following table presents a summary of the Company's cash flows:

Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007

Net cash flow provided by
operating activities $595.6 $682.0 $1,622.4 $1,530.0
Net cash flow used for
investing activities $(1,831.3) $(320.9) $(1,788.7) $(43.0)
Net cash flow used for
financing activities $(209.3) $(942.9) $(366.7) $(1,764.8)

CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
(continued)
(Unaudited; all amounts, except per share amounts, are in millions)

2008 and 2007 Adjusted Results

The following tables reconcile financial measures excluding stock-based
compensation expense, restructuring charges and dispositions, to the reported
measures included in this earnings release. The Company believes that
adjusting its financial results for the impact of these items is relevant and
useful for investors because it allows investors to view performance in a
manner similar to the method used by the Company's management, provides a
clearer perspective on the current underlying performance of the Company and
makes it easier to compare the Company's year-over-year results.

Three Months Ended June 30, 2008

Stock- Restruc- Decrease
based turing Disposi- vs.
2008 Compensa- Charges tions 2008 2007
Reported tion (a) (b) Adjusted Adjusted

Revenues $3,393.7 $- $- $- $3,393.7
OIBDA 760.4 39.1 2.6 - 802.1 (10)%
Operating income 637.0 39.1 2.6 - 678.7 (13)%
Interest expense (134.3) - - - (134.3)
Interest income 15.2 - - - 15.2
Other items, net 124.9 - - (127.2) (2.3)
Earnings before income
taxes 642.8 39.1 2.6 (127.2) 557.3
Provision for income
taxes (232.9) (15.5) (1.0) 48.9 (200.5)
Effective income tax
rate 36.2% 36.0%

Equity in loss of
investee companies,
net of tax (1.2) - - - (1.2)
Minority interest,
net of tax (.3) - - - (.3)
Net earnings $408.4 $23.6 $1.6 $(78.3) $355.3 (15)%
Diluted EPS $.61 $.03 $- $(.12) $.53 (7)%
Diluted weighted average
number of common shares
outstanding 674.3 674.3 674.3 674.3 674.3

Three Months Ended June 30, 2007

2007 Stock-based Dispositions 2007
Reported Compensation (c) Adjusted

Revenues $3,374.9 $- $- $3,374.9
OIBDA 859.4 30.5 - 889.9
Operating income 749.9 30.5 - 780.4
Interest expense (145.5) - - (145.5)
Interest income 33.8 - - 33.8
Other items, net 4.3 - (9.2) (4.9)
Earnings before income taxes 642.5 30.5 (9.2) 663.8
Provision for income taxes (233.7) (12.1) 6.2 (239.6)
Effective income tax rate 36.4% 36.1%

Equity in loss of investee
companies, net of tax (4.9) - - (4.9)
Minority interest, net of tax .1 - - .1
Net earnings $404.0 $18.4 $(3.0) $419.4
Diluted EPS $.55 $.03 $- $.57
Diluted weighted average number
of common shares outstanding 729.4 729.4 729.4 729.4

(a) Restructuring charges at Outdoor reflecting severance costs associated
with headcount reductions.
(b) Gain on sale of investment in Sundance Channel.
(c) Gain on the divestitures of radio stations.

CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
(continued)
(Unaudited; all amounts, except per share amounts, are in millions)

Six Months Ended June 30, 2008

Stock- Restruc- Inc/(Dec)
based turing Disposi- vs.
2008 Compensa- Charges tions 2008 2007
Reported tion (a) (b) Adjusted Adjusted

Revenues $7,047.8 $- $- $- $7,047.8
OIBDA 1,402.4 72.2 47.5 - 1,522.1 (2)%
Operating income 1,161.2 72.2 47.5 - 1,280.9 (3)%
Interest expense (273.0) - - - (273.0)
Interest income 32.8 - - - 32.8
Other items, net 124.7 - - (127.2) (2.5)
Earnings before
income taxes 1,045.7 72.2 47.5 (127.2) 1,038.2
Provision for
income taxes (384.2) (28.6) (18.8) 48.9 (382.7)
Effective income tax
rate 36.7% 36.9%

Equity in loss of
investee companies,
net of tax (8.4) - - - (8.4)
Minority interest,
net of tax (.4) - - - (.4)
Net earnings $652.7 $43.6 $28.7 $(78.3) $646.7 (6)%
Diluted EPS $.97 $.06 $.04 $(.12) $.96 4%
Diluted weighted average
number of common shares
outstanding 674.0 674.0 674.0 674.0 674.0

Six Months Ended June 30, 2007

2007 Stock-based Dispositions 2007
Reported Compensation (c) Adjusted

Revenues $7,032.7 $- $- $7,032.7
OIBDA 1,495.9 51.5 - 1,547.4
Operating income 1,271.2 51.5 - 1,322.7
Interest expense (285.3) - - (285.3)
Interest income 73.1 - - 73.1
Other items, net 2.8 - (12.6) (9.8)
Earnings before income taxes 1,061.8 51.5 (12.6) 1,100.7
Provision for income taxes (437.9) (20.4) 49.7 (408.6)
Effective income tax rate 41.2% 37.1%

Equity in loss of investee
companies, net of tax (6.8) - - (6.8)
Minority interest, net of tax .4 - - .4
Net earnings $617.5 $31.1 $37.1 $685.7
Diluted EPS $.83 $.04 $.05 $.92
Diluted weighted average number
of common shares outstanding 747.2 747.2 747.2 747.2

(a) Restructuring charges at Television ($34.9 million), Radio ($10.0
million) and Outdoor ($2.6 million) reflecting severance costs associated with
headcount reductions.
(b) Gain on sale of investment in Sundance Channel.
(c) Pre-tax gain and related tax provision of the divestitures of radio
stations.

CBS CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
(continued)
(Unaudited; Dollars in millions)

Radio Segment Same Station Reconciliation

The Company has completed all of the previously announced sales of 39
radio stations in ten of its smaller markets. The following table presents
the revenues for the Radio segment on a same station basis, which excludes all
revenues for the divested stations, for all periods presented. The Company
believes that adjusting the revenues of the Radio segment for the impact of
station divestitures provides investors with a clearer perspective on the
current underlying financial performance of the Radio segment.

Three Months Ended Six Months Ended
June 30, Better/ June 30, Better/
2008 2007 (Worse)% 2008 2007 (Worse)%

Radio revenues,
as reported $416.4 $463.4 (10)% $779.9 $860.9 (9)%
Divested stations - (8.1) n/m - (17.7) n/m
Radio revenues,
same station
basis $416.4 $455.3 (9)% $779.9 $843.2 (8)%

n/m - not meaningful

Business Outlook
The following table presents the Company's business outlook for 2008,
which is based on 2007 results adjusted to exclude stock-based compensation
expense. The Company believes that providing its business outlook excluding
the impact of stock-based compensation expense is relevant and meaningful
because it provides management and investors with a clearer perspective on the
Company's underlying growth. The Company currently expects stock-based
compensation expense in 2008 to be in the range of $155 million to $165
million compared to $106.6 million in 2007.

Twelve Months Ended December 31, 2007

2007 Stock-based 2007 2008
Reported Compensation Adjusted Business Outlook

Low Single-Digit
OIBDA $3,077.5 $106.6 $3,184.1 Growth

Depreciation and
amortization (455.7) - (455.7)
Operating income $2,621.8 $106.6 $2,728.4 Comparable

SOURCE CBS Corporation

Press: Gil Schwartz, Executive Vice President, Corporate Communications,
+1-212-975-2121, gdschwartz@cbs.com, or Dana McClintock, Senior Vice
President, Corporate Communications, +1-212-975-1077, dlmcclintock@cbs.com, or
Andrea Prochniak, Vice President, Corporate Communications, +1-212-975-0053,
andrea.prochniak@cbs.com, Investors: Martin Shea, Executive Vice President,
Investor Relations, +1-212-975-8571, marty.shea@cbs.com, or Adam Townsend,
Executive Vice President, Investor Relations, +1-212-975-5292,
adam.townsend@cbs.com, or Debra Wichser, Vice President, Investor Relations,
+1-212-975-3718, debra.wichser@cbs.com