R.H. Donnelley Reports Third Quarter Results

- Net Revenue of $648 million

CARY, N.C., Oct. 23 /PRNewswire-FirstCall/ -- R.H. Donnelley Corporation
(NYSE: RHD), one of the nation's leading Yellow Pages and online local
commercial search companies, today reported third quarter net revenues of $648
million. Adjusted EBITDA(1) in the quarter was $334 million. Adjusted free
cash flow was $108 million, based on cash flow from operations of $110
million, capital expenditures of $17 million and $15 million of other
adjustments. Third quarter advertising sales were $504 million, down 8.3
percent from pro forma advertising sales for the same period in the prior
year. Net income and EPS for the quarter were $26 million and $0.38 per
share, respectively. As of September 30, 2008, RHD's net debt outstanding was
$9,564 million, excluding the purchase accounting fair value adjustment of $91
million.
(Logo: http://www.newscom.com/cgi-bin/prnh/20060731/NYM044LOGO)
"We continue to make excellent progress streamlining operating processes
and reducing costs," said David C. Swanson, chairman and CEO of R.H.
Donnelley. "The decline in third quarter ad sales was as expected due to weak
consumer sentiment and the impact it is having on advertisers' ability to make
new growth investments, pay existing bills, and for some, stay in business.
As a result of the continued deterioration in the economy, we are revising our
full year 2008 guidance to the low end of the previous range."
Swanson continued, "While we are carefully managing expenses and maintain our
focus on debt reduction, we remain committed to increasing the value we
provide to advertisers and consumers. We continue to expand advertisers'
reach by connecting them with consumers looking for local products and
services regardless of where they are searching. This month we rolled out our
exciting new voice search platform, 1-800-CALL-DEX, across the 14-state Qwest
region. This service allows consumers to use their phone to search our
accurate and comprehensive database of local business information as well as
locate businesses near landmarks or other convenient search criteria. By
year-end, we will launch DexKnows.com 2.0, our next generation local search
site. In addition, in the first half of 2009, we will be launching the Dex
Search Network and a new DexKnows.com platform for mobile, continuing to
increase consumers' ability to access our unique and up to date content over
additional convenient platforms. These initiatives are all about building the
foundation for sustainable growth as the economy recovers."
Capital Markets Activity
During the third quarter, the Company repurchased senior notes and senior
discount notes of R.H. Donnelley Corporation having an aggregate principal
value of approximately $187 million for $92 million.(2) In addition, the
Company repaid approximately $35 million of bank debt during the same period.
On October 22, 2008, R.H. Donnelley Inc., a wholly owned subsidiary of the
Company, obtained a waiver under its senior secured credit facility to permit
voluntary prepayments of its Term Loan D-1 and Term Loan D-2 at a discount to
their principal amounts. R.H. Donnelley Inc. is not obligated to make any
such prepayments.
Outlook
The Company is clarifying its full year 2008 guidance to be at the low end
of the previously announced range that was issued on July 30 for ad sales,
adjusted EBITDA and adjusted free cash flow. Net debt at year end, excluding
the fair value adjustment, is now expected to be less than $9.5 billion.
Guidance for full year net revenue and weighted average diluted shares
outstanding are unchanged. Current 2008 guidance is summarized below (all
numbers are approximate):
-- Ad sales decline of 8%.
-- Net revenue of $2.6 billion.
-- Adjusted EBITDA(3) of $1,350 million; operating loss of $2,345 million;
and adjusted operating income(3) of $860 million.
-- Adjusted free cash flow(4) of $475 million and operating cash flow of
$505 million.
-- Net debt at year end of less than $9.5 billion, excluding the fair
value adjustment of $0.1 billion.
-- Weighted average diluted shares outstanding during 2008 of
70 million.

See Schedule 6 for a reconciliation of the foregoing non-GAAP measures to
the most comparable GAAP measures.
Further important information regarding operating results and related
reconciliations of non-GAAP financial measures to the most comparable GAAP
measures can be found in the schedules and related footnotes of this press
release, which should be thoroughly reviewed. Advertising sales is a
statistical measure and consists of sales of advertising in print directories
distributed during the period and Internet-based products and services with
respect to which such advertising first appeared publicly during the period.
It is important to distinguish advertising sales from net revenues, which is
recognized under the deferral and amortization method.
Third Quarter Conference Call
R.H. Donnelley will host a conference call to discuss its third quarter
2008 results today at 10:00 a.m. (ET). The call can be accessed by dialing
888-387-9606 (domestic) or 517-645-6055 (international). The pass code for
the call is "RHD". Please dial in to the call by 9:50 a.m. (ET) to ensure a
prompt start time. The call will also be available through a Web cast, which
can be accessed by visiting our Web site at http://www.rhd.com, clicking on
"Investor Relations" and following the instructions provided. Those unable to
participate at the scheduled time may access a recorded replay by dialing
866-382-4784 (domestic) or 203-369-0363 (international). There is no pass
code for the replay, which will be available through November 6, 2008. In
addition, an archived version of the Web cast will be available on RHD's Web
site for up to one year from the date of the call.
Helping Local Businesses Reach More Customers
R.H. Donnelley's interactive offerings are essential to its Triple Play
solution suite -- an integrated set of products and services that efficiently
and effectively extend the marketing reach of local businesses. Spanning
multiple media platforms -- print Yellow Pages directories, DexKnows.com(TM)
search site and the major search engines (e.g., Yahoo!(R) and Google(R)) via
the Company's Dex Search Network(TM) -- Triple Play delivers the
advertisements of local businesses to a wider set of ready-to-buy consumers.
About R.H. Donnelley
R.H. Donnelley connects businesses and consumers through its portfolio of
print and interactive marketing solutions. Small- and medium-sized businesses
look to R.H. Donnelley's experienced team of marketing consultants to help
them grow their companies and drive sales leads. Consumers depend on the
Company's reliable, local business content to deliver the most relevant search
results when they are seeking local goods and services. For more information,
visit http://www.rhd.com and http://DexKnows.com.
Safe Harbor Provision
Certain statements contained in this press release regarding RHD's future
operating results or performance or business plans or prospects and any other
statements not constituting historical fact are "forward-looking statements"
subject to the safe harbor created by the Private Securities Litigation Reform
Act of 1995. Where possible, the words "believe," "expect," "anticipate,"
"intend," "should," "will," "would," "planned," "estimated," "potential,"
"goal," "outlook," "may," "predicts," "could," or the negative of such terms,
or other comparable expressions, as they relate to RHD or its management, have
been used to identify such forward-looking statements. All forward-looking
statements reflect only RHD's current beliefs and assumptions with respect to
future business plans, prospects, decisions and results, and are based on
information currently available to RHD. Accordingly, the statements are
subject to significant risks, uncertainties and contingencies, which could
cause RHD's actual operating results, performance or business plans or
prospects to differ materially from those expressed in, or implied by, these
statements.
Factors that could cause actual results to differ materially from current
expectations include risks and other factors described in RHD's publicly
available reports filed with the SEC, which contain a discussion of various
factors that may affect RHD's business or financial results. Such risks and
other factors, which in some instances are beyond RHD's control, include: our
ability to generate sufficient cash to service our significant debt levels;
our ability to comply with or obtain modifications or waivers of the financial
covenants contained in our debt agreements, and the potential impact to
operations and liquidity as a result of restrictive covenants in such debt
agreements; our ability to refinance our debt on reasonable terms and
conditions as might be necessary from time to time, particularly in light of
the recent instability in the credit markets; increasing LIBOR rates; changes
in directory advertising spend and consumer usage; regulatory and judicial
rulings; competition and other economic conditions; changes in the Company's
and the Company's subsidiaries credit ratings; changes in accounting
standards; adverse results from litigation, governmental investigations or tax
related proceedings or audits; the effect of labor strikes, lock-outs and
negotiations; successful integration and realization of the expected benefits
of acquisitions; the continued enforceability of the commercial agreements
with Qwest, Embarq and AT&T; our reliance on third-party vendors for various
services; and other events beyond our control that may result in unexpected
adverse operating results. RHD is not responsible for updating the
information contained in this press release beyond the published date, or for
changes made to this document by wire services or Internet service providers.
This press release is being furnished to the SEC through a Form 8-K. The
Company's next 10-Q report to be filed with the SEC may contain updates to the
information included in this release.
(1) Before the following expenses: (a) restructuring, (b) FAS 123 R and
(c)restricted stock units related to the Business.com acquisition.

(2) The Company repurchased notes having an aggregate principal amount of
$22 million or $7 million in September that did not settle until early
October.

(3) Before the following expenses: (a) restructuring, (b) FAS 123 R and
(c) restricted stock units related to the Business.com acquisition.

(4) Before restructuring costs and restricted stock unit costs related to
the Business.com acquisition.

(See attached tables)

R.H. DONNELLEY CORPORATION
INDEX OF SCHEDULES
------------------

Schedule 1: Index of Schedules

Schedule 2: Unaudited Condensed Consolidated Statements of Operations
for the three months ended September 30, 2008 and 2007

Schedule 3: Unaudited Condensed Consolidated Statements of Operations
for the nine months ended September 30, 2008 and 2007

Schedule 4: Unaudited Condensed Consolidated Balance Sheets at
September 30, 2008 and December 31, 2007

Schedule 5: Unaudited Condensed Consolidated Statements of Cash Flows
for the three and nine months ended September 30, 2008 and
2007

Schedule 6: Reconciliation of Non-GAAP Measures

Schedule 7: Statistical Measures -- Advertising Sales

Schedule 8: Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Schedule 2
Amounts in millions, except earnings per share

Three Months Ended September 30,
2008 2007
Net revenue (1) $648.0 $671.2
Expenses (1) 336.7 322.1
Depreciation and amortization 125.4 111.6
Operating income 185.9 237.5
Interest expense, net (198.1) (201.1)
Gain on debt transactions, net (2) 70.2 -
Pre-tax income 58.0 36.4
Tax provision (31.9) (18.3)
Net income $26.1 $18.1

Earnings per share (EPS):
Basic $0.38 $0.25
Diluted $0.38 $0.25
Shares used in computing EPS:
Basic 68.8 71.2
Diluted 68.9 72.2

See accompanying Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures - Schedule 8.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
---------------------------------------------------------

Schedule 3
Amounts in millions, except (loss) earnings per share

Nine Months Ended September 30,
2008 2007
Net revenue (1) $1,986.4 $1,999.5
Expenses (1) 976.0 971.2
Depreciation and amortization 363.3 323.7
Goodwill impairment (3) 3,123.9 -
Operating (loss) income (2,476.8) 704.6
Interest expense, net (630.4) (601.7)
Gain on debt transactions, net (2) 231.5 -
Pre-tax (loss) income (2,875.7) 102.9
Tax benefit (provision) 939.8 (43.9)
Net (loss) income $(1,935.9) $59.0

(Loss) earnings per share (EPS):
Basic $(28.15) $0.83
Diluted $(28.15) $0.82
Shares used in computing EPS:
Basic 68.8 70.8
Diluted 68.8 71.9

See accompanying Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures - Schedule 8.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION Schedule 4
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
-----------------------------------------------

Amounts in millions
September 30, December 31,
2008 2007
Assets
Cash and cash equivalents $60.8 $46.1
Accounts receivable, net 1,035.6 1,063.5
Deferred directory costs 175.0 183.7
Other current assets 124.8 173.9
Total current assets 1,396.2 1,467.2

Fixed assets and computer software, net 182.1 187.7
Intangible assets, net 10,859.1 11,170.5
Other non-current assets 180.0 139.4
Goodwill (3) - 3,124.3
Total Assets $12,617.4 $16,089.1

Liabilities and Shareholders' (Deficit) Equity
Accounts payable and accrued
liabilities $177.1 $230.7
Accrued interest 147.5 198.8
Deferred directory revenue 1,097.7 1,172.0
Current portion of long-term debt 121.3 177.2
Total current liabilities 1,543.6 1,778.7

Long-term debt 9,594.4 9,998.5
Deferred income taxes, net 1,356.2 2,288.4
Other non-current liabilities 192.3 200.8
Total liabilities 12,686.5 14,266.4

Shareholders' (deficit) equity (69.1) 1,822.7

Total Liabilities and Shareholders'
(Deficit) Equity $12,617.4 $16,089.1

See accompanying Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures - Schedule 8.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Schedule 5
---------------------------------------------------------
Amounts in millions

Three Months Ended Nine Months Ended
September 30, September 30,
Operating activities: 2008 2007 2008 2007

Net income (loss) $26.1 $18.1 $(1,935.9) $59.0
Goodwill impairment (3) - - 3,123.9 -
Gain on debt transactions, net (2) (70.2) - (231.5) -
Depreciation and amortization 125.4 111.6 363.3 323.7
Deferred income taxes 31.6 11.4 (943.0) 36.6
Changes in working capital (17.1) 0.4 (88.1) (17.0)
Other 14.6 14.5 97.9 68.0
Net cash provided by operating
activities 110.4 156.0 386.6 470.3

Investment activities:
Additions to fixed assets and computer
software (17.0) (24.5) (47.3) (61.8)
Acquisitions, net of cash received - (328.9) - (328.9)
Equity investment disposition
(investment) - - 4.3 (2.5)
Net cash used in investing activities (17.0) (353.4) (43.0) (393.2)

Financing activities:
Proceeds from the issuance of debt, net
of costs - 323.7 - 323.7
Additional borrowings under credit
facilities, net of costs - - 1,018.2 -
Credit facilities repayments (33.6) (215.2) (1,224.7) (562.3)
Revolver repayments (26.0) (175.5) (422.1) (566.1)
Borrowings under the Revolver 25.0 209.0 398.1 570.7
Note repurchases and related costs (84.7) - (84.7) -
Proceeds from the issuance of common
stock - 9.0 - 9.0
Repurchase of common stock - - (6.1) -
Debt issuance costs (1.5) - (9.6) -
Increase (decrease) in checks not yet
presented for payment 6.2 (0.5) 1.9 (2.0)
Proceeds from option exercises - 0.9 0.1 12.7

Net cash (used in) provided by
financing activities (114.6) 151.4 (328.9) (214.3)

(Decrease) increase in cash and cash
equivalents (21.2) (46.0) 14.7 (137.2)

Cash and cash equivalents, beginning
of period 82.0 65.0 46.1 156.2

Cash and cash equivalents, end of
period $60.8 $19.0 $60.8 $19.0

Supplemental Information:
Non-cash financing activities:
Reduction of debt from Debt
Exchanges $- $- $(172.8) $-

See accompanying Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures - Schedule 8.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION Schedule 6a
RECONCILIATION OF NON-GAAP MEASURES
-----------------------------------
(unaudited)

Amounts in millions
Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007

Reconciliation of net income (loss) - GAAP to EBITDA (4)

Net income (loss) - GAAP $26.1 $18.1 $(1,935.9) $59.0
Less gain on debt transactions, net (2) (70.2) - (231.5) -
Plus goodwill impairment (3) - - 3,123.9 -
Plus tax provision (benefit) 31.9 18.3 (939.8) 43.9
Plus interest expense, net 198.1 201.1 630.4 601.7
Plus depreciation and amortization 125.4 111.6 363.3 323.7
EBITDA $311.3 $349.1 $1,010.4 $1,028.3

Amortized deferred cost uplift on Dex
sales contracts as of the merger date - 3.3 - 27.9

Purchase accounting adjustments
related to bad debt expense
previously charged
to goodwill related to Qwest
directories acquired in the Dex
Media transaction - - - 3.3

SFAS No. 123 R non-cash compensation
expense 7.1 8.5 23.4 30.0

Restricted stock unit expense related
to the Business.com acquisition 1.0 0.8 4.2 0.8

Restructuring costs 14.3 - 18.9 -

Adjusted EBITDA $333.7 $361.7 $1,056.9 $1,090.3

See accompanying Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures - Schedule 8.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION Schedule 6b
RECONCILIATION OF NON-GAAP MEASURES (cont'd)
--------------------------------------------
(unaudited)

Amounts in millions

Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007

Reconciliation of cash flow from
operations - GAAP to adjusted free
cash flow

Cash flow from operations - GAAP $110.4 $156.0 $386.6 $470.3
Add: Restructuring costs 14.0 - 15.5 -
Add: Restricted stock unit cost
related to the Business.com
acquisition 1.0 0.8 4.5 0.8
Adjusted cash flow from operations 125.4 156.8 406.6 471.1
Less: Additions to fixed assets and
computer software - GAAP 17.0 24.5 47.3 61.8
Adjusted free cash flow $108.4 $132.3 $359.3 $409.3

Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007

Reconciliation of interest expense -
GAAP to adjusted interest expense (5)

Interest expense - GAAP $198.1 $201.1 $630.4 $601.7
Plus: Fair value adjustment due to
purchase accounting 4.5 7.9 13.1 23.2
Less: One-time expense related to
ineffective interest rate swaps as a
result of the refinancings completed
during the second quarter of 2008 - - (42.9) -
Adjusted interest expense $202.6 $209.0 $600.6 $624.9

As of As of
September December
30, 2008 31, 2007
Reconciliation of debt - GAAP to net
debt and net debt - excluding
fair value adjustment (5) (6)

Debt - GAAP $9,715.7 $10,175.7
Less: Cash and cash equivalents (60.8) (46.1)
Net debt 9,654.9 10,129.6

Less: Fair value adjustment due to
purchase accounting (90.7) (103.8)
Net debt - excluding fair value
adjustment $9,564.2 $10,025.8

See accompanying Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures - Schedule 8.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION Schedule 6c
RECONCILIATION OF NON-GAAP MEASURES (cont'd)
--------------------------------------------
(unaudited)

Current
Full Year 2008
Amounts in millions Outlook
Reconciliation of adjusted EBITDA excluding the impairment
of goodwill, SFAS No. 123 R outlook and restructuring
expense outlook, to operating income - GAAP outlook

Adjusted EBITDA excluding
restructuring, SFAS No. 123 R non-cash compensation and
restricted stock unit expense outlook $1,350
Less: Depreciation and amortization (490)
Adjusted Operating Income 860

Less: Impairment of goodwill (3,125)
Less: SFAS No. 123 R non-cash compensation expense and
restricted stock unit expense related to the Business.com
acquisition (40)
Less: Restructuring expense (40)
Operating loss - GAAP outlook $(2,345)

Current
Full Year 2008
Outlook
Amounts in millions
Reconciliation of cash flow from operations - GAAP outlook to
adjusted free cash flow outlook

Cash flow from operations - GAAP outlook $505
Less: Additions to fixed assets and computer software (75)
Plus: Restructuring costs 40
Plus: Restricted stock unit cost related to the Business.com
acquisition 5
Adjusted free cash flow outlook $475

Current
Full Year 2008
Outlook
Amounts in billions
Reconciliation of net debt - outlook to net debt - excluding
fair value adjustment outlook

Net debt - outlook $9.6
Less: Fair value adjustment due to purchase accounting (0.1)
Net debt - excluding fair value adjustment outlook $9.5

See accompanying Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures - Schedule 8.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION Schedule 7
STATISTICAL MEASURES
CALCULATION OF ADVERTISING SALES PERCENTAGE CHANGE OVER PRIOR YEAR PERIOD
-------------------------------------------------------------------------
(unaudited)

Amounts in millions, except percentages

Nine
Months
Ended Three Months Ended
September September June March December
30, 2008 30 30 31 31

2008 Advertising sales (7) $1,899.8 $503.6 $678.3 $717.9

2007 Pro forma advertising sales $700.3

2007 Advertising sales disclosed
in 2007 Form 10-Q's 2,017.9 541.6 729.0 747.3

2006 Advertising sales disclosed
in 2006 Form 10-K and Form 10-
Q's 682.6

Pro forma adjustments related to
Business.com Acquisition 41.8 14.3 14.2 13.3 9.2

Adjustments primarily related to
changes in publication dates (14.6) (6.7) (1.3) (6.6) 4.0

2007 Pro forma advertising
sales $2,045.1 $549.2 $741.9 $754.0

2006 Pro forma advertising sales $695.8

Pro forma advertising sales
percentage change over prior
year period (7.1%) (8.3%) (8.6%) (4.8%) 0.7%

See accompanying Notes to Unaudited Condensed Consolidated Financial
Statements and Non-GAAP Measures - Schedule 8.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

R.H. DONNELLEY CORPORATION Schedule 8
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------
AND NON-GAAP MEASURES
---------------------

(1) Revenue with respect to print advertising, and Internet-based
advertising products that are bundled with print advertising, is
recognized under the deferral and amortization method. Revenue related
to our print advertising is initially deferred when a directory is
published and recognized ratably over the directory's life, which is
typically 12 months. Revenue with respect to our Internet-based
advertising products that are bundled with print advertising is
initially deferred when the service is delivered or fulfilled and
recognized ratably over the life of the contract. Revenue with respect
to Internet-based services that are not bundled with print
advertising, such as SEM and SEO services, is recognized as delivered
or fulfilled.

Certain prior period amounts included in the unaudited condensed
consolidated statement of operations have been reclassified to conform
to the current period's presentation. Beginning in the fourth quarter
of 2007, we began classifying adjustments for customer claims to sales
allowance, which is deducted from gross revenue to determine net
revenue. In prior periods, adjustments for customer claims were
included in bad debt expense. Accordingly, we have reclassified
adjustments for customer claims and bad debt expense for the three and
nine months ended September 30, 2007 by $1.3 million and $0.2 million,
respectively, to conform to the current period's presentation. These
reclassifications had no impact on operating income or net income for
the three and nine months ended September 30, 2007.

(2) During the three months ended September 30, 2008, RHD repurchased
$165.5 million ($159.9 million accreted value) of its senior notes and
senior discount notes ("Senior Notes") for a purchase price of $84.7
million (the "September 2008 Debt Repurchases"). As a result of the
September 2008 Debt Repurchases, we recognized a gain of $72.4 million
during the three months ended September 30, 2008, representing the
difference between the accreted value or par value, as applicable, and
purchase price of the Senior Notes, offset by the write-off of
unamortized deferred financing costs of $2.9 million. In October 2008,
RHD repurchased $21.5 million of its Senior Notes for a purchase price
of $7.4 million (the October 2008 Debt Repurchases"). As a result of
the October 2008 Debt Repurchases, we will recognize a gain of $13.6
million during the fourth quarter of 2008, consisting of the
difference between the accreted value or par value, as applicable, and
purchase price of the Senior Notes, offset by the write-off of
unamortized deferred financing costs of $0.4 million.

On June 25, 2008, RHD completed an exchange of its senior notes and
senior discount notes for new senior notes ("Debt Exchanges"). Please
refer to our Current Report on Form 8-K filed on June 25, 2008 for
additional information. The Debt Exchanges have been accounted for as
an extinguishment of debt, resulting in a gain of approximately $161.3
million, representing the difference between the accreted value or par
value, as applicable, of the former senior notes and senior discount
notes and the new senior notes of $172.8 million, offset by the write-
off of unamortized deferred financing costs of $11.5 million
associated with the former senior notes and senior discount notes.
During the nine months ended September 30, 2008 we recognized a charge
of $2.2 million for the write-off of unamortized deferred financing
costs associated with the refinancing of the former Dex Media West
credit facility and portions of the amended RHDI Credit Facility,
which have been accounted for as extinguishments of debt.

(3) We performed impairment tests as of March 31, 2008 of our goodwill and
definite lived intangible assets in accordance with SFAS No. 142,
Goodwill and Other Intangible Assets ("SFAS No. 142") and SFAS No.
144, Accounting for the Impairment or Disposal of Long-Lived Assets
("SFAS No. 144"), respectively. The first step involved comparing the
fair value of the Company with the carrying amount of our assets and
liabilities, including goodwill. The fair value of the Company was
determined using a market based approach, which reflects the market
value of our debt and equity securities as of March 31, 2008. As a
result of our testing, we determined that the Company's fair value was
less than the carrying amount of our assets and liabilities, requiring
us to proceed with the second step. In the second step of the testing
process, the impairment loss is determined by comparing the implied
fair value of our goodwill to the recorded amount of goodwill. The
implied fair value of goodwill is derived from a discounted cash flow
analysis for the Company using a discount rate that results in the
present value of assets and liabilities equal to the current fair
value of the Company's debt and equity securities. Based upon this
analysis, we recognized a non-cash impairment charge of $2.5 billion
during the three months ended March 31, 2008. Since the trading value
of our equity securities further declined in the second quarter of
2008, we performed additional impairment tests of our goodwill and
other long-lived assets. As a result of these tests, we recognized a
non-cash goodwill impairment charge of $660.2 million during the three
months ended June 30, 2008. Subsequent to this impairment charge, we
have no recorded goodwill at September 30, 2008.

(4) EBITDA represents earnings before interest, taxes, depreciation and
amortization. Adjusted EBITDA represents adjusted earnings before
interest, taxes, depreciation and amortization. EBITDA and Adjusted
EBITDA are not measurements of operating performance computed in
accordance with GAAP and should not be considered as a substitute for
operating income or net income prepared in conformity with GAAP. In
addition, EBITDA may not be comparable to similarly titled measures of
other companies. EBITDA for the three months ended September 30, 2008
and 2007 includes charges of $7.1 million and $8.5 million,
respectively, for stock-based compensation in accordance with SFAS No.
123 (R), Share-Based Payment ("SFAS No. 123 (R)"). EBITDA for the nine
months ended September 30, 2008 and 2007 includes charges of $23.4
million and $30.0 million, respectively, for stock-based compensation
in accordance with SFAS No. 123 (R). As a result of purchase
accounting required by GAAP, we recorded the deferred directory costs
related to Qwest directories that were scheduled to publish subsequent
to the Dex Media Merger at their fair value, determined as (a) the
estimated billable value of the published directory less (b) the
expected costs to complete the directories, plus (c) a normal profit
margin. We refer to this purchase accounting entry as "cost uplift."
Net income - GAAP and EBITDA for the three and nine months ended
September 30, 2007 includes approximately $3.3 million and $27.9
million, respectively, of cost uplift associated with the Dex Media
transaction. Net income (loss) - GAAP and EBITDA for the three and
nine months ended September 30, 2008 includes approximately $1.0
million and $4.2 million, respectively, of restricted stock unit
expense related to the Business.com Acquisition, of which $1.0 million
and $4.5 million, respectively, has been paid in cash during the
period. Net income - GAAP and EBITDA for the three and nine months
ended September 30, 2007 includes approximately $0.8 million of
restricted stock unit expense related to the Business.com Acquisition,
which was paid in cash during the period. Net income (loss) - GAAP and
EBITDA for the three and nine months ended September 30, 2008 includes
approximately $14.3 million and $18.9 million of restructuring costs,
respectively, of which $14.0 million and $15.5 million, respectively,
has been paid in cash during the period. EBITDA for the nine months
ended September 30, 2007 also excludes recoveries and other purchase
accounting adjustments related to bad debt expense previously charged
to goodwill of $3.3 million, related to Qwest directories acquired in
the Dex Media transaction.

(5) As a result of purchase accounting, RHD was required to adjust the
carrying value of Dex Media's debt at January 31, 2006 to its fair
value. Adjusted interest expense eliminates the interest benefit
resulting from the amortization of the fair value adjustment to Dex
Media's debt. As a result of the amendment of the RHDI Credit Facility
and the refinancing of the former Dex Media West credit facility on
June 6, 2008, the existing interest rate swaps associated with these
two debt arrangements are no longer highly effective in offsetting
changes in cash flows. Accordingly, these interest rate swaps became
ineffective on June 6, 2008 and cash flow hedge accounting treatment
under SFAS No. 133, Accounting for Derivative Instruments and Hedging
Activities ("SFAS No. 133") is no longer permitted. Interest expense
for the nine months ended September 30, 2008 includes a non-cash
charge of $42.9 million resulting from the reclass of amounts
previously charged to accumulated other comprehensive loss related to
these interest rate swaps. Adjusted interest expense eliminates this
one time charge to interest expense.

(6) Net debt represents total debt less cash and cash equivalents on the
respective date. Net debt - excluding fair value adjustments
represents net debt adjusted to remove the remaining fair value
purchase accounting adjustment of Dex Media's debt noted in footnote 5
above. The unamortized fair value adjustment at September 30, 2008 is
$90.7 million.

(7) Advertising sales is a statistical measure and consists of sales of
advertising in print directories distributed during the period and
Internet-based products and services with respect to which such
advertising first appeared publicly during the period. It is
important to distinguish advertising sales from net revenue, which is
recognized under the deferral and amortization method. 2007 pro forma
advertising sales assumes the Business.com Acquisition occurred on
January 1, 2007.

Note: These schedules are preliminary and subject to change pending the
Company's filing of its Form 10-Q.

SOURCE R.H. Donnelley Corporation

investors, James M. Gruskin, 1-800-497-6329, or media, Tyler D. Gronbach,
+1-919-297-1541, both for R.H. Donnelley Corporation