Delaware
|
|
001-36097
|
|
38-3910250
|
|||
(State or Other Jurisdiction of Incorporation or Organization)
|
|
(Commission File Number)
|
|
(I.R.S. Employer Identification No.)
|
|||
|
|
|
|
|
|
|
|
7950 Jones Branch Drive,
|
McLean,
|
Virginia
|
|
|
|
|
22107-0910
|
(Address of principal executive offices)
|
|
|
|
|
(Zip Code)
|
||
|
|
|
|
|
|
|
|
(703)
|
854-6000
|
|
Not Applicable
|
||||
(Registrant's telephone number, including area code)
|
|
(Former name or former address, if changed since last report.)
|
Title of Each Class
|
|
Trading Symbol
|
|
Name of Each Exchange on Which Registered
|
Common Stock, par value $0.01 per share
|
|
GCI
|
|
The New York Stock Exchange
|
|
|
Gannett Co., Inc.
|
|
|
|
Date: February 27, 2020
|
By:
|
/s/ Alison K. Engel
|
|
|
Alison K. Engel
|
|
|
Chief Financial Officer and Chief Accounting Officer
|
|
Fourth Quarter 2019
|
|
Full Year 2019
|
||||||||||||
in thousands
|
Actual
|
|
Pro Forma
|
|
Actual
|
|
Pro Forma
|
||||||||
GAAP operating revenue
|
$
|
699,274
|
|
|
$
|
1,054,253
|
|
|
$
|
1,867,909
|
|
|
$
|
4,182,220
|
|
GAAP net loss attributable to Gannett
|
(95,088
|
)
|
|
(115,694
|
)
|
|
(119,842
|
)
|
|
(114,983
|
)
|
||||
Adjusted EBITDA(1) (non-GAAP)
|
98,821
|
|
|
141,208
|
|
|
223,871
|
|
|
485,452
|
|
||||
Free cash flow(2) (non-GAAP)
|
(79,692
|
)
|
|
N/A
|
|
|
11,557
|
|
|
N/A
|
|
•
|
Fourth quarter GAAP revenues of $699.3 million rose 68.1% as compared to the prior year quarter reflecting the Acquisition.
|
◦
|
Legacy Gannett fourth quarter same store revenues decreased 10.1% year-over-year.
|
◦
|
Legacy New Media fourth quarter same store revenues decreased 9.6% year-over-year.
|
•
|
Pro forma digital advertising and marketing services revenues reached $231.8 million in the fourth quarter, or 22.0% of total pro forma revenues.
|
•
|
GAAP net loss attributable to Gannett of $95.1 million in the fourth quarter reflects a one-time non-cash write-down of $100.7 million related to the revaluation of intangibles and $145.6 million one-time cash charges related to restructuring and transaction related costs.
|
•
|
Adjusted EBITDA totaled $98.8 million and represented a 14.1% margin. On a pro forma basis, Adjusted EBITDA totaled $141.2 million and represented a 13.4% margin.
|
•
|
2019 GAAP revenues of $1.9 billion rose 22.4% as compared to the prior year reflecting the Acquisition.
|
◦
|
Legacy Gannett 2019 same store revenues decreased 9.4% year-over-year.
|
◦
|
Legacy New Media 2019 same store revenues decreased 8.0% year-over-year.
|
•
|
Pro forma digital advertising and marketing services revenues reached $912.5 million in 2019, or 21.8% of total pro forma revenues.
|
•
|
GAAP net loss attributable to Gannett of $119.8 million in 2019 reflects a one-time $100.7 million non-cash write-down related to the revaluation of intangibles and $182.9 million one-time cash charges related to restructuring and transaction related costs.
|
•
|
Adjusted EBITDA totaled $223.9 million and represented a 12.0% margin. On a pro forma basis, Adjusted EBITDA reached $485.5 million and represented a 11.6% margin.
|
•
|
Publishing segment revenues totaled $653.9 million in the fourth quarter; on a pro forma basis, Publishing segment revenues were $964.7 million.
|
•
|
Print advertising revenues totaled $240.9 million in the fourth quarter; on a pro forma basis, print advertising revenues were $334.1 million, reflecting continued secular pressures.
|
◦
|
Same store Legacy Gannett print advertising revenues decreased 20.1% as compared to the prior year quarter.
|
◦
|
Same store Legacy New Media print advertising revenue decreased 16.3%, as compared to the prior year quarter.
|
•
|
Digital advertising and marketing services revenues were $90.1 million in the fourth quarter; on a pro forma basis, digital advertising and marketing services revenues were $150.3 million.
|
◦
|
Legacy Gannett same store digital advertising and marketing services revenues decreased 1.6% as compared to the prior year quarter, an improvement from the third quarter trend, reflecting improved digital marketing services results.
|
◦
|
Legacy New Media same store digital advertising and marketing services revenues decreased 0.4% year-over-year.
|
•
|
Circulation revenues totaled $255.6 million in the fourth quarter; on a pro forma basis, circulation revenues were $384.4 million.
|
◦
|
Legacy Gannett same store circulation revenues decreased 10.3% year-over-year, as expected, reflecting the cycling of last year's more aggressive pricing initiatives.
|
◦
|
Legacy New Media same store circulation revenues decreased 7.2% from the prior year.
|
•
|
Commercial printing and other revenues contributed $67.3 million to Publishing segment revenues in the fourth quarter.
|
•
|
Paid digital-only subscriber volumes now total approximately 812,000, up 25.3% year-over-year on a pro forma basis.
|
•
|
Publishing segment Adjusted EBITDA was $113.3 million, representing a margin of 17.3% for the quarter.
|
•
|
Marketing Solutions segment revenues were $69.3 million in the fourth quarter; on a pro forma basis, Marketing Solutions segment revenues were $122.7 million.
|
◦
|
Legacy Gannett same store digital marketing services revenues increased 1.8% as compared to the prior year, similar to the 2.5% gain in the third quarter. Revenues across the Legacy Gannett local markets achieved another quarter of robust growth, driven by an increase in the number of clients.
|
•
|
Marketing Solutions segment Adjusted EBITDA was $4.0 million, representing a margin of 5.8% for the quarter.
|
•
|
Cash flow from operations was negative $73.0 million compared to positive $37.6 million for the prior year quarter, as net cash used in operating activities from Legacy Gannett of $72.4 million included additional pension and postretirement contributions of $92.4 million, most of which were related to an $87.8 million pay-out of pension benefits upon change-in-control. Additionally, cash flow from operations was reduced by $35.9 million of integration and reorganization costs, $19.3 million of acquisition costs, and $2.5 million of other one-time adjustments.
|
•
|
Capital expenditures were $6.7 million, primarily for product development, technology investments, and maintenance projects.
|
•
|
The Company repaid $35.8 million in principal under its credit facility.
|
•
|
As of the end of the fourth quarter, the Company had a cash balance of $156.0 million.
|
For investor inquiries, contact:
|
|
For media inquiries, contact:
|
Ashley Higgins and Stacy Cunningham
|
|
Stephanie Tackach
|
Investor Relations
|
|
Director, Public Relations
|
212-479-3160
|
|
212-715-5490
|
investors@gannett.com
|
|
stackach@gannett.com
|
CONSOLIDATED BALANCE SHEETS
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands (except per share amounts)
|
|||||||
Table No. 1 (1)
|
|
|
|
||||
Assets
|
December 31, 2019
|
|
December 30, 2018
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
156,042
|
|
|
$
|
48,651
|
|
Accounts receivable, net of allowance for doubtful accounts of $19,923 and $8,042 at December 31, 2019 and December 30, 2018, respectively
|
438,523
|
|
|
174,274
|
|
||
Inventories
|
55,090
|
|
|
25,022
|
|
||
Prepaid expenses and other current assets
|
129,460
|
|
|
49,662
|
|
||
Total current assets
|
779,115
|
|
|
297,609
|
|
||
Property, plant, and equipment, net of accumulated depreciation of $277,291 and $219,256 at December 31, 2019 and December 30, 2018, respectively
|
815,807
|
|
|
339,608
|
|
||
Operating lease assets
|
309,112
|
|
|
—
|
|
||
Goodwill
|
914,331
|
|
|
310,737
|
|
||
Intangible assets, net of accumulated amortization of $145,773 and $101,543 at December 31, 2019 and December 30, 2018, respectively
|
1,012,564
|
|
|
486,054
|
|
||
Deferred income taxes
|
76,297
|
|
|
—
|
|
||
Other assets
|
112,876
|
|
|
9,856
|
|
||
Total assets
|
$
|
4,020,102
|
|
|
$
|
1,443,864
|
|
|
|
|
|
||||
Liabilities and equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Current portion of long-term debt
|
$
|
3,300
|
|
|
$
|
12,395
|
|
Accounts payable
|
146,995
|
|
|
16,612
|
|
||
Accrued expenses
|
306,633
|
|
|
109,597
|
|
||
Deferred revenue
|
218,823
|
|
|
105,187
|
|
||
Other current liabilities
|
42,702
|
|
|
4,053
|
|
||
Total current liabilities
|
718,453
|
|
|
247,844
|
|
||
Long-term debt
|
1,636,335
|
|
|
428,180
|
|
||
Convertible debt
|
3,300
|
|
|
—
|
|
||
Deferred income taxes
|
9,052
|
|
|
8,282
|
|
||
Pension and other postretirement benefit obligations
|
235,906
|
|
|
24,326
|
|
||
Long-term operating lease liabilities
|
297,662
|
|
|
—
|
|
||
Other long-term liabilities
|
136,188
|
|
|
16,462
|
|
||
Total noncurrent liabilities
|
2,318,443
|
|
|
477,250
|
|
||
Total liabilities
|
3,036,896
|
|
|
725,094
|
|
||
Redeemable noncontrolling interests
|
1,850
|
|
|
1,547
|
|
||
Commitments and contingent liabilities
|
|
|
|
||||
|
|
|
|
||||
Equity
|
|
|
|
||||
Common stock, $0.01 par value, 2,000,000,000 shares authorized; 129,386,258 shares issued and 128,991,544 shares outstanding at December 31, 2019; 60,508,249 shares issued and 60,306,286 shares outstanding at December 30, 2018
|
1,294
|
|
|
605
|
|
||
Treasury stock, at cost, 394,714 and 201,963 shares at December 31, 2019 and December 30, 2018, respectively
|
(2,876
|
)
|
|
(1,873
|
)
|
||
Additional paid-in capital
|
1,090,694
|
|
|
721,605
|
|
||
Retained earnings
|
(115,958
|
)
|
|
3,767
|
|
||
Accumulated other comprehensive loss (income)
|
8,202
|
|
|
(6,881
|
)
|
||
Total equity
|
981,356
|
|
|
717,223
|
|
||
Total liabilities and equity
|
$
|
4,020,102
|
|
|
$
|
1,443,864
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands (except per share amounts)
|
|||||||||||||||
Table No. 2 (1)
|
Three months ended
|
|
Year ended
|
||||||||||||
Fiscal year ended
|
December 31, 2019
|
|
December 30, 2018
|
|
December 31, 2019
|
|
December 30, 2018
|
||||||||
Operating revenues:
|
|
|
|
|
|
|
|
||||||||
Advertising and marketing services
|
$
|
370,324
|
|
|
$
|
217,687
|
|
|
$
|
952,644
|
|
|
$
|
786,577
|
|
Circulation
|
255,574
|
|
|
154,503
|
|
|
704,842
|
|
|
574,963
|
|
||||
Commercial printing and other
|
73,376
|
|
|
43,849
|
|
|
210,423
|
|
|
164,484
|
|
||||
Total operating revenues
|
699,274
|
|
|
416,039
|
|
|
1,867,909
|
|
|
1,526,024
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Operating costs
|
398,322
|
|
|
230,299
|
|
|
1,079,593
|
|
|
865,234
|
|
||||
Selling, general and administrative expenses
|
227,711
|
|
|
136,994
|
|
|
606,917
|
|
|
502,631
|
|
||||
Depreciation and amortization
|
43,148
|
|
|
20,515
|
|
|
111,882
|
|
|
84,791
|
|
||||
Integration and reorganization costs
|
37,899
|
|
|
1,768
|
|
|
47,401
|
|
|
15,011
|
|
||||
Acquisition costs
|
45,300
|
|
|
762
|
|
|
60,618
|
|
|
2,651
|
|
||||
Impairment of long-lived assets
|
540
|
|
|
417
|
|
|
3,009
|
|
|
1,538
|
|
||||
Goodwill and mastheads impairment
|
100,743
|
|
|
—
|
|
|
100,743
|
|
|
—
|
|
||||
Net (gain) loss on sale or disposal of assets
|
1,384
|
|
|
80
|
|
|
4,723
|
|
|
(3,971
|
)
|
||||
Total operating expenses
|
855,047
|
|
|
390,835
|
|
|
2,014,886
|
|
|
1,467,885
|
|
||||
Operating income (loss)
|
(155,773
|
)
|
|
25,204
|
|
|
(146,977
|
)
|
|
58,139
|
|
||||
Non-operating (income) expense:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
33,283
|
|
|
9,606
|
|
|
63,660
|
|
|
36,072
|
|
||||
Loss on early extinguishment of debt
|
6,058
|
|
|
2,886
|
|
|
6,058
|
|
|
2,886
|
|
||||
Other (income) expense
|
(8,709
|
)
|
|
452
|
|
|
(9,511
|
)
|
|
(838
|
)
|
||||
Non-operating expense
|
30,632
|
|
|
12,944
|
|
|
60,207
|
|
|
38,120
|
|
||||
Income (loss) before income taxes
|
(186,405
|
)
|
|
12,260
|
|
|
(207,184
|
)
|
|
20,019
|
|
||||
Provision (benefit) for income taxes
|
(90,924
|
)
|
|
(679
|
)
|
|
(85,994
|
)
|
|
1,912
|
|
||||
Net income (loss)
|
$
|
(95,481
|
)
|
|
$
|
12,939
|
|
|
$
|
(121,190
|
)
|
|
$
|
18,107
|
|
Net loss attributable to redeemable noncontrolling interests
|
(393
|
)
|
|
(321
|
)
|
|
(1,348
|
)
|
|
(89
|
)
|
||||
Net income (loss) attributable to Gannett
|
$
|
(95,088
|
)
|
|
$
|
13,260
|
|
|
$
|
(119,842
|
)
|
|
$
|
18,196
|
|
Earnings (loss) per share attributable to Gannett - basic
|
$
|
(1.05
|
)
|
|
$
|
0.22
|
|
|
$
|
(1.77
|
)
|
|
$
|
0.31
|
|
Earnings (loss) per share attributable to Gannett - diluted
|
$
|
(1.05
|
)
|
|
$
|
0.22
|
|
|
$
|
(1.77
|
)
|
|
$
|
0.31
|
|
Dividends declared per share
|
$
|
—
|
|
|
$
|
0.38
|
|
|
$
|
1.52
|
|
|
$
|
1.49
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
|||||||
Table No. 3 (1)
|
Year ended
|
||||||
|
December 31, 2019
|
|
December 30, 2018
|
||||
Operating activities:
|
|
|
|
||||
Net income (loss)
|
$
|
(121,190
|
)
|
|
$
|
18,107
|
|
Adjustments to reconcile net income (loss) to operating cash flows:
|
|
|
|
||||
Depreciation and amortization
|
111,882
|
|
|
84,791
|
|
||
Facility consolidation costs
|
148
|
|
|
—
|
|
||
Stock-based compensation - equity awards
|
11,324
|
|
|
3,156
|
|
||
Non-cash interest expense
|
3,851
|
|
|
1,996
|
|
||
Non-cash acquisition related costs
|
26,411
|
|
|
—
|
|
||
(Benefit) provision for deferred income taxes
|
(87,765
|
)
|
|
202
|
|
||
Net (gain) loss on sale or disposal of assets
|
4,723
|
|
|
(3,971
|
)
|
||
Non-cash charge to investments
|
—
|
|
|
505
|
|
||
Non-cash loss on early extinguishment of debt
|
6,058
|
|
|
2,886
|
|
||
Impairment of long-lived assets
|
3,009
|
|
|
1,538
|
|
||
Goodwill and mastheads impairment
|
100,743
|
|
|
—
|
|
||
Pension and other postretirement benefit obligations
|
(100,452
|
)
|
|
(2,575
|
)
|
||
Change in assets and liabilities:
|
|
|
|
||||
Accounts receivables, net
|
12,608
|
|
|
15
|
|
||
Inventory
|
5,150
|
|
|
(4,336
|
)
|
||
Prepaid expenses
|
7,016
|
|
|
3,338
|
|
||
Accounts payable
|
3,958
|
|
|
(2,530
|
)
|
||
Accrued expenses
|
40,353
|
|
|
8,019
|
|
||
Deferred revenue
|
(8,326
|
)
|
|
(7,642
|
)
|
||
Other assets and liabilities
|
6,034
|
|
|
6,060
|
|
||
Net cash provided by operating activities
|
25,535
|
|
|
109,559
|
|
||
Investing activities:
|
|
|
|
||||
Acquisitions, net of cash acquired
|
(796,502
|
)
|
|
(204,877
|
)
|
||
Purchases of property, plant, and equipment
|
(13,978
|
)
|
|
(11,639
|
)
|
||
Proceeds from sale of publications, real estate and other assets, and insurance proceeds
|
27,486
|
|
|
15,040
|
|
||
Change in other investing activities
|
(2,066
|
)
|
|
—
|
|
||
Net cash used for investing activities
|
(785,060
|
)
|
|
(201,476
|
)
|
||
Financing activities:
|
|
|
|
||||
Payments of debt issuance costs
|
(121,223
|
)
|
|
(800
|
)
|
||
Borrowings under term loans
|
1,792,000
|
|
|
79,675
|
|
||
Borrowings under revolving credit facility
|
153,900
|
|
|
20,000
|
|
||
Repayments under term loans
|
(481,058
|
)
|
|
(3,093
|
)
|
||
Repayments under revolving credit facility
|
(153,900
|
)
|
|
(20,000
|
)
|
||
Repayments of convertible debt
|
(197,950
|
)
|
|
—
|
|
||
Payment of offering costs
|
—
|
|
|
(369
|
)
|
||
Issuance of common stock, net of underwriters' discount
|
—
|
|
|
111,099
|
|
||
Purchase of treasury stock
|
(1,002
|
)
|
|
(792
|
)
|
||
Repurchase of common stock
|
—
|
|
|
—
|
|
||
Payments of dividends
|
(91,936
|
)
|
|
(87,195
|
)
|
||
Change in other financing activities
|
82
|
|
|
—
|
|
||
Net cash provided by financing activities
|
898,913
|
|
|
98,525
|
|
||
Effect of currency exchange rate change
|
(3,494
|
)
|
|
—
|
|
||
Increase in cash, cash equivalents, and restricted cash
|
135,894
|
|
|
6,608
|
|
||
Balance of cash, cash equivalents, and restricted cash at beginning of year
|
52,770
|
|
|
46,162
|
|
||
Cash, cash equivalents, and restricted cash at end of year
|
$
|
188,664
|
|
|
$
|
52,770
|
|
SEGMENT INFORMATION
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
|||||||||||||||
Table No. 4 (1)
|
Three months ended
|
|
Year ended
|
||||||||||||
|
December 31, 2019
|
|
December 30, 2018
|
|
December 31, 2019
|
|
December 30, 2018
|
||||||||
Operating revenues:
|
|
|
|
|
|
|
|
||||||||
Publishing
|
$
|
653,877
|
|
|
$
|
406,966
|
|
|
$
|
1,792,652
|
|
|
$
|
1,495,124
|
|
Marketing Solutions
|
69,336
|
|
|
26,878
|
|
|
149,242
|
|
|
95,871
|
|
||||
Corporate and Other
|
2,018
|
|
|
675
|
|
|
4,554
|
|
|
3,118
|
|
||||
Intersegment eliminations
|
(25,957
|
)
|
|
(18,480
|
)
|
|
(78,539
|
)
|
|
(68,089
|
)
|
||||
Total
|
$
|
699,274
|
|
|
$
|
416,039
|
|
|
$
|
1,867,909
|
|
|
$
|
1,526,024
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA:
|
|
|
|
|
|
|
|
||||||||
Publishing
|
$
|
113,334
|
|
|
$
|
68,132
|
|
|
$
|
268,916
|
|
|
$
|
220,415
|
|
Marketing Solutions
|
4,024
|
|
|
(1,896
|
)
|
|
(3,279
|
)
|
|
(6,404
|
)
|
||||
Corporate and Other
|
(18,537
|
)
|
|
(10,267
|
)
|
|
(41,766
|
)
|
|
(33,718
|
)
|
||||
Total
|
$
|
98,821
|
|
|
$
|
55,969
|
|
|
$
|
223,871
|
|
|
$
|
180,293
|
|
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization:
|
|
|
|
|
|
|
|
||||||||
Publishing
|
$
|
37,442
|
|
|
$
|
18,787
|
|
|
$
|
101,881
|
|
|
$
|
78,075
|
|
Marketing Solutions
|
3,714
|
|
|
1,263
|
|
|
6,534
|
|
|
5,003
|
|
||||
Corporate and Other
|
1,992
|
|
|
465
|
|
|
3,467
|
|
|
1,713
|
|
||||
Total
|
$
|
43,148
|
|
|
$
|
20,515
|
|
|
$
|
111,882
|
|
|
$
|
84,791
|
|
SAME STORE REVENUES
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
||||||||||
Table No. 5
|
Three months ended
|
|||||||||
Legacy Gannett
|
December 31, 2019
|
|
December 31, 2018 (1)
|
|
% Change
|
|||||
|
|
|
|
|
|
|||||
Pro forma total revenue
|
$
|
654,132
|
|
|
$
|
751,405
|
|
|
(12.9
|
)%
|
Currency impact
|
401
|
|
|
—
|
|
|
***
|
|
||
Exited operations
|
(15
|
)
|
|
(11,157
|
)
|
|
(99.9
|
)%
|
||
Deferred revenue adjustment
|
10,791
|
|
|
—
|
|
|
***
|
|
||
Same store total revenue
|
$
|
665,309
|
|
|
$
|
740,248
|
|
|
(10.1
|
)%
|
|
|
|
|
|
|
|
||||
Pro forma advertising and marketing services revenue
|
$
|
365,776
|
|
|
$
|
427,226
|
|
|
(14.4
|
)%
|
Currency impact
|
374
|
|
|
—
|
|
|
***
|
|
||
Exited operations
|
(15
|
)
|
|
(11,102
|
)
|
|
(99.9
|
)%
|
||
Deferred revenue adjustment
|
1,262
|
|
|
—
|
|
|
***
|
|
||
Same store advertising and marketing services revenue
|
$
|
367,397
|
|
|
$
|
416,124
|
|
|
(11.7
|
)%
|
|
|
|
|
|
|
|
||||
Pro forma circulation revenue
|
$
|
236,128
|
|
|
$
|
273,757
|
|
|
(13.7
|
)%
|
Currency impact
|
26
|
|
|
—
|
|
|
***
|
|
||
Deferred revenue adjustment
|
9,529
|
|
|
—
|
|
|
***
|
|
||
Same store circulation revenue
|
$
|
245,683
|
|
|
$
|
273,757
|
|
|
(10.3
|
)%
|
|
|
|
|
|
|
|
||||
Pro forma other revenue
|
$
|
52,228
|
|
|
$
|
50,422
|
|
|
3.6
|
%
|
Currency impact
|
1
|
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(55
|
)
|
|
(100.0
|
)%
|
||
Same store other revenue
|
$
|
52,229
|
|
|
$
|
50,367
|
|
|
3.7
|
%
|
SAME STORE REVENUES
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
||||||||||
Table No. 5 (continued)
|
Year ended
|
|||||||||
Legacy Gannett
|
December 31, 2019
|
|
December 31, 2018 (1)
|
|
% Change
|
|||||
|
|
|
|
|
|
|||||
Pro forma total revenue
|
$
|
2,613,463
|
|
|
$
|
2,916,838
|
|
|
(10.4
|
)%
|
Acquired revenues
|
(35,779
|
)
|
|
—
|
|
|
***
|
|
||
Currency impact
|
14,766
|
|
|
—
|
|
|
***
|
|
||
Exited operations
|
(322
|
)
|
|
(43,712
|
)
|
|
(99.3
|
)%
|
||
Deferred revenue adjustment
|
10,791
|
|
|
—
|
|
|
***
|
|
||
Same store total revenue
|
$
|
2,602,919
|
|
|
$
|
2,873,126
|
|
|
(9.4
|
)%
|
|
|
|
|
|
|
|
||||
Pro forma advertising and marketing services revenue
|
$
|
1,444,562
|
|
|
$
|
1,661,075
|
|
|
(13.0
|
)%
|
Acquired revenues
|
(34,578
|
)
|
|
—
|
|
|
***
|
|
||
Currency impact
|
10,249
|
|
|
—
|
|
|
***
|
|
||
Exited operations
|
(319
|
)
|
|
(43,640
|
)
|
|
(99.3
|
)%
|
||
Deferred revenue adjustment
|
1,262
|
|
|
—
|
|
|
***
|
|
||
Same store advertising and marketing services revenue
|
$
|
1,421,176
|
|
|
$
|
1,617,435
|
|
|
(12.1
|
)%
|
|
|
|
|
|
|
|
||||
Pro forma circulation revenue
|
$
|
976,538
|
|
|
$
|
1,063,022
|
|
|
(8.1
|
)%
|
Acquired revenues
|
(1,130
|
)
|
|
—
|
|
|
***
|
|
||
Currency impact
|
3,443
|
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
—
|
|
|
***
|
|
||
Deferred revenue adjustment
|
9,529
|
|
|
—
|
|
|
***
|
|
||
Same store circulation revenue
|
$
|
988,380
|
|
|
$
|
1,063,022
|
|
|
(7.0
|
)%
|
|
|
|
|
|
|
|
||||
Pro forma other revenue
|
$
|
192,363
|
|
|
$
|
192,741
|
|
|
(0.2
|
)%
|
Acquired revenues
|
(71
|
)
|
|
—
|
|
|
***
|
|
||
Currency impact
|
1,074
|
|
|
—
|
|
|
***
|
|
||
Exited operations
|
(3
|
)
|
|
(72
|
)
|
|
(95.8
|
)%
|
||
Same store other revenue
|
$
|
193,363
|
|
|
$
|
192,669
|
|
|
0.4
|
%
|
SAME STORE REVENUES
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
||||||||||
Table No. 5 (continued)
|
Three months ended
|
|||||||||
Legacy New Media
|
December 31, 2019
|
|
December 30, 2018 (1)
|
|
% Change
|
|||||
|
|
|
|
|
|
|||||
As reported total revenue
|
$
|
400,121
|
|
|
$
|
416,039
|
|
|
(3.8
|
)%
|
Acquired revenues
|
(26,385
|
)
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(2,666
|
)
|
|
(100.0
|
)%
|
||
Same store total revenue
|
$
|
373,736
|
|
|
$
|
413,373
|
|
|
(9.6
|
)%
|
|
|
|
|
|
|
|
||||
As reported advertising and marketing services revenue
|
$
|
200,435
|
|
|
$
|
217,687
|
|
|
(7.9
|
)%
|
Acquired revenues
|
(11,622
|
)
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(1,632
|
)
|
|
(100.0
|
)%
|
||
Same store advertising and marketing services revenue
|
$
|
188,813
|
|
|
$
|
216,055
|
|
|
(12.6
|
)%
|
|
|
|
|
|
|
|
||||
As reported circulation revenue
|
$
|
148,248
|
|
|
$
|
154,503
|
|
|
(4.0
|
)%
|
Acquired revenues
|
(5,151
|
)
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(291
|
)
|
|
(100.0
|
)%
|
||
Same store circulation revenue
|
$
|
143,097
|
|
|
$
|
154,212
|
|
|
(7.2
|
)%
|
|
|
|
|
|
|
|
||||
As reported other revenue
|
$
|
51,438
|
|
|
$
|
43,849
|
|
|
17.3
|
%
|
Acquired revenues
|
(9,612
|
)
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(743
|
)
|
|
(100.0
|
)%
|
||
Same store other revenue
|
$
|
41,826
|
|
|
$
|
43,106
|
|
|
(3.0
|
)%
|
SAME STORE REVENUES
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
||||||||||
Table No. 5 (continued)
|
Year ended
|
|||||||||
Legacy New Media
|
December 31, 2019
|
|
December 30, 2018 (1)
|
|
% Change
|
|||||
|
|
|
|
|
|
|||||
As reported total revenue
|
$
|
1,568,757
|
|
|
$
|
1,526,024
|
|
|
2.8
|
%
|
Acquired revenues
|
(176,870
|
)
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(13,188
|
)
|
|
(100.0
|
)%
|
||
Same store total revenue
|
$
|
1,391,887
|
|
|
$
|
1,512,836
|
|
|
(8.0
|
)%
|
|
|
|
|
|
|
|||||
As reported advertising and marketing services revenue
|
$
|
782,755
|
|
|
$
|
786,577
|
|
|
(0.5
|
)%
|
Acquired revenues
|
(97,742
|
)
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(8,282
|
)
|
|
(100.0
|
)%
|
||
Same store advertising and marketing services revenue
|
$
|
685,013
|
|
|
$
|
778,295
|
|
|
(12.0
|
)%
|
|
|
|
|
|
|
|||||
As reported circulation revenue
|
$
|
597,517
|
|
|
$
|
574,963
|
|
|
3.9
|
%
|
Acquired revenues
|
(59,225
|
)
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(1,904
|
)
|
|
(100.0
|
)%
|
||
Same store circulation revenue
|
$
|
538,292
|
|
|
$
|
573,059
|
|
|
(6.1
|
)%
|
|
|
|
|
|
|
|||||
As reported other revenue
|
$
|
188,485
|
|
|
$
|
164,484
|
|
|
14.6
|
%
|
Acquired revenues
|
(19,903
|
)
|
|
—
|
|
|
***
|
|
||
Exited operations
|
—
|
|
|
(3,002
|
)
|
|
(100.0
|
)%
|
||
Same store other revenue
|
$
|
168,582
|
|
|
$
|
161,482
|
|
|
4.4
|
%
|
•
|
Adjusted EBITDA is a non-GAAP financial performance measure the Company believes offers a useful view of the overall operation of our business. The Company defines Adjusted EBITDA as net income (loss) attributable to Gannett before (1) income tax expense (benefit), (2) interest expense, (3) gains or losses on early extinguishment of debt, (4) non-operating items, primarily pension costs, (5) depreciation and amortization, (6) integration and reorganization costs, (7) impairment of long-lived assets, (8) goodwill and intangible impairments, (9) net loss (gain) on sale or disposal of assets, (10) non-cash compensation, (11) acquisition costs, and (12) certain other non-recurring charges. The most directly comparable GAAP financial measure is net income (loss) attributable to Gannett.
|
•
|
Free cash flow is a non-GAAP liquidity measure that adjusts our reported GAAP results for items we believe are critical to the ongoing success of our business. The Company defines Free cash flow as net cash provided by operating activities as reported on the statement of cash flows less capital expenditures, which results in a figure representing Free cash flow available for use in operations, additional investments, debt obligations, and returns to shareholders. The most directly comparable GAAP financial measure is net cash from operating activities.
|
NON-GAAP FINANCIAL INFORMATION
ADJUSTED EBITDA
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
Table No. 6 (1)
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
Three months ended December 31, 2019
|
||||||||||||||
|
Publishing
|
|
Marketing Solutions
|
|
Corporate and Other
|
|
Consolidated Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to Gannett
|
$
|
(52,036
|
)
|
|
$
|
(1,392
|
)
|
|
$
|
(41,660
|
)
|
|
$
|
(95,088
|
)
|
Income tax expense (benefit)
|
—
|
|
|
—
|
|
|
(90,924
|
)
|
|
(90,924
|
)
|
||||
Interest expense
|
24
|
|
|
—
|
|
|
33,259
|
|
|
33,283
|
|
||||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
6,058
|
|
|
6,058
|
|
||||
Other non-operating items, net
|
(6
|
)
|
|
(775
|
)
|
|
(7,928
|
)
|
|
(8,709
|
)
|
||||
Depreciation and amortization
|
37,442
|
|
|
3,714
|
|
|
1,992
|
|
|
43,148
|
|
||||
Integration and reorganization costs
|
13,777
|
|
|
950
|
|
|
23,172
|
|
|
37,899
|
|
||||
Acquisition costs
|
—
|
|
|
—
|
|
|
45,300
|
|
|
45,300
|
|
||||
Impairment of long-lived assets
|
540
|
|
|
—
|
|
|
—
|
|
|
540
|
|
||||
Goodwill and mastheads impairment
|
100,743
|
|
|
—
|
|
|
—
|
|
|
100,743
|
|
||||
Net (gain) loss on sale or disposal of assets
|
1,289
|
|
|
(8
|
)
|
|
103
|
|
|
1,384
|
|
||||
Non-cash compensation
|
—
|
|
|
—
|
|
|
8,790
|
|
|
8,790
|
|
||||
Other items
|
11,561
|
|
|
1,535
|
|
|
3,301
|
|
|
16,397
|
|
||||
Adjusted EBITDA (non-GAAP basis)
|
$
|
113,334
|
|
|
$
|
4,024
|
|
|
$
|
(18,537
|
)
|
|
$
|
98,821
|
|
|
|
|
|
|
|
|
|
||||||||
|
Three months ended December 30, 2018
|
||||||||||||||
|
Publishing
|
|
Marketing Solutions
|
|
Corporate and Other
|
|
Consolidated Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to Gannett
|
$
|
45,631
|
|
|
$
|
(3,866
|
)
|
|
$
|
(28,505
|
)
|
|
$
|
13,260
|
|
Income tax expense (benefit)
|
—
|
|
|
—
|
|
|
(679
|
)
|
|
(679
|
)
|
||||
Interest expense
|
56
|
|
|
—
|
|
|
9,549
|
|
|
9,605
|
|
||||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
2,886
|
|
|
2,886
|
|
||||
Other non-operating items, net
|
(467
|
)
|
|
—
|
|
|
580
|
|
|
113
|
|
||||
Depreciation and amortization
|
18,787
|
|
|
1,263
|
|
|
465
|
|
|
20,515
|
|
||||
Integration and reorganization costs
|
1,541
|
|
|
—
|
|
|
227
|
|
|
1,768
|
|
||||
Acquisition costs
|
—
|
|
|
15
|
|
|
747
|
|
|
762
|
|
||||
Impairment of long-lived assets
|
417
|
|
|
—
|
|
|
—
|
|
|
417
|
|
||||
Goodwill and mastheads impairment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net (gain) loss on sale or disposal of assets
|
51
|
|
|
—
|
|
|
29
|
|
|
80
|
|
||||
Non-cash compensation
|
—
|
|
|
—
|
|
|
657
|
|
|
657
|
|
||||
Other items
|
2,116
|
|
|
692
|
|
|
3,777
|
|
|
6,585
|
|
||||
Adjusted EBITDA (non-GAAP basis)
|
$
|
68,132
|
|
|
$
|
(1,896
|
)
|
|
$
|
(10,267
|
)
|
|
$
|
55,969
|
|
NON-GAAP FINANCIAL INFORMATION
ADJUSTED EBITDA
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
Table No. 6 (continued) (1)
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
Year ended December 31, 2019
|
||||||||||||||
|
Publishing
|
|
Marketing Solutions
|
|
Corporate and Other
|
|
Consolidated Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to Gannett
|
$
|
22,523
|
|
|
$
|
(14,006
|
)
|
|
$
|
(128,359
|
)
|
|
$
|
(119,842
|
)
|
Income tax expense (benefit)
|
—
|
|
|
—
|
|
|
(85,994
|
)
|
|
(85,994
|
)
|
||||
Interest expense
|
123
|
|
|
—
|
|
|
63,537
|
|
|
63,660
|
|
||||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
6,058
|
|
|
6,058
|
|
||||
Other non-operating items, net
|
(969
|
)
|
|
(775
|
)
|
|
(7,767
|
)
|
|
(9,511
|
)
|
||||
Depreciation and amortization
|
101,881
|
|
|
6,534
|
|
|
3,467
|
|
|
111,882
|
|
||||
Integration and reorganization costs
|
21,336
|
|
|
1,937
|
|
|
24,128
|
|
|
47,401
|
|
||||
Acquisition costs
|
—
|
|
|
(38
|
)
|
|
60,656
|
|
|
60,618
|
|
||||
Impairment of long-lived assets
|
3,009
|
|
|
—
|
|
|
—
|
|
|
3,009
|
|
||||
Goodwill and mastheads impairment
|
100,743
|
|
|
—
|
|
|
—
|
|
|
100,743
|
|
||||
Net (gain) loss on sale or disposal of assets
|
4,036
|
|
|
(5
|
)
|
|
692
|
|
|
4,723
|
|
||||
Non-cash compensation
|
—
|
|
|
—
|
|
|
11,324
|
|
|
11,324
|
|
||||
Other items
|
16,234
|
|
|
3,074
|
|
|
10,492
|
|
|
29,800
|
|
||||
Adjusted EBITDA (non-GAAP basis)
|
$
|
268,916
|
|
|
$
|
(3,279
|
)
|
|
$
|
(41,766
|
)
|
|
$
|
223,871
|
|
|
|||||||||||||||
|
Year ended December 30, 2018
|
||||||||||||||
|
Publishing
|
|
Marketing Solutions
|
|
Corporate and Other
|
|
Consolidated Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to Gannett
|
$
|
122,392
|
|
|
$
|
(14,047
|
)
|
|
$
|
(90,149
|
)
|
|
$
|
18,196
|
|
Income tax expense (benefit)
|
—
|
|
|
—
|
|
|
1,912
|
|
|
1,912
|
|
||||
Interest expense
|
400
|
|
|
—
|
|
|
35,672
|
|
|
36,072
|
|
||||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
2,886
|
|
|
2,886
|
|
||||
Other non-operating items, net
|
(1,554
|
)
|
|
—
|
|
|
—
|
|
|
(1,554
|
)
|
||||
Depreciation and amortization
|
78,075
|
|
|
5,003
|
|
|
1,713
|
|
|
84,791
|
|
||||
Integration and reorganization costs
|
14,487
|
|
|
—
|
|
|
524
|
|
|
15,011
|
|
||||
Acquisition costs
|
—
|
|
|
85
|
|
|
2,566
|
|
|
2,651
|
|
||||
Impairment of long-lived assets
|
1,538
|
|
|
—
|
|
|
—
|
|
|
1,538
|
|
||||
Goodwill and mastheads impairment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net (gain) loss on sale or disposal of assets
|
(3,109
|
)
|
|
34
|
|
|
(896
|
)
|
|
(3,971
|
)
|
||||
Non-cash compensation
|
—
|
|
|
—
|
|
|
3,156
|
|
|
3,156
|
|
||||
Other items
|
8,186
|
|
|
2,521
|
|
|
8,898
|
|
|
19,605
|
|
||||
Adjusted EBITDA (non-GAAP basis)
|
$
|
220,415
|
|
|
$
|
(6,404
|
)
|
|
$
|
(33,718
|
)
|
|
$
|
180,293
|
|
NON-GAAP FINANCIAL INFORMATION
FREE CASH FLOW
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
|
|||||||
|
|
|
|
||||
Table No. 7
|
|
|
|
||||
|
Three months ended December 31, 2019
|
|
Year ended December 31, 2019
|
||||
|
|
|
|
||||
Net cash flow provided by operating activities (GAAP basis)
|
$
|
(72,995
|
)
|
|
$
|
25,535
|
|
Capital expenditures
|
(6,697
|
)
|
|
(13,978
|
)
|
||
Free cash flow (non-GAAP basis)(1)
|
$
|
(79,692
|
)
|
|
$
|
11,557
|
|