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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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47-2390983
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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7950 Jones Branch Drive, McLean, Virginia
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22107-0910
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(Address of principal executive offices)
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(Zip Code)
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Large Accelerated Filer
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ý
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Accelerated Filer
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¨
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Non-Accelerated Filer
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¨
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Smaller Reporting Company
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¨
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(Do not check if a smaller reporting company)
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Emerging Growth Company
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¨
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Item No.
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Page
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1
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2
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3
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4
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1
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1A
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2
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3
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4
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5
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6
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Jun. 25, 2017
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Dec. 25, 2016
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||||
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(Unaudited)
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|
||||
ASSETS
|
|
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||||
Current assets
|
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|
||||
Cash and cash equivalents
|
$
|
126,940
|
|
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$
|
114,324
|
|
Accounts receivable, net of allowance for doubtful accounts of $9,371 and $10,317
|
317,843
|
|
|
358,041
|
|
||
Other current assets
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142,758
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|
|
131,141
|
|
||
Total current assets
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587,541
|
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603,506
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|
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Property, plant and equipment, at cost net of accumulated depreciation of $1,457,313 and $1,481,897
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981,891
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1,087,701
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Goodwill
|
726,424
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|
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698,288
|
|
||
Intangible assets, net
|
157,653
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|
|
154,644
|
|
||
Deferred income taxes
|
196,345
|
|
|
218,232
|
|
||
Investments and other assets
|
70,261
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|
|
82,310
|
|
||
Total assets
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$
|
2,720,115
|
|
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$
|
2,844,681
|
|
|
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|
|
||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
377,637
|
|
|
$
|
438,724
|
|
Deferred income
|
137,351
|
|
|
133,263
|
|
||
Total current liabilities
|
514,988
|
|
|
571,987
|
|
||
Income taxes
|
15,790
|
|
|
25,467
|
|
||
Postretirement medical and life insurance liabilities
|
83,224
|
|
|
90,134
|
|
||
Pension liabilities
|
710,201
|
|
|
739,262
|
|
||
Long-term portion of revolving credit facility
|
385,000
|
|
|
400,000
|
|
||
Other noncurrent liabilities
|
160,422
|
|
|
161,070
|
|
||
Total liabilities
|
1,869,625
|
|
|
1,987,920
|
|
||
Equity
|
|
|
|
||||
Preferred stock of $0.01 par value per share, 5,000,000 shares authorized, none issued
|
—
|
|
|
—
|
|
||
Common stock of $0.01 par value per share, 500,000,000 shares authorized, 117,417,393 shares issued at Jun. 25, 2017 and 116,624,726 shares issued at Dec. 25, 2016
|
1,174
|
|
|
1,166
|
|
||
Treasury stock at cost, 3,750,000 shares
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(32,667
|
)
|
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(32,667
|
)
|
||
Additional paid-in capital
|
1,776,970
|
|
|
1,769,905
|
|
||
Retained earnings (deficit)
|
(37,661
|
)
|
|
1,269
|
|
||
Accumulated other comprehensive loss
|
(857,326
|
)
|
|
(882,912
|
)
|
||
Total equity
|
850,490
|
|
|
856,761
|
|
||
Total liabilities and equity
|
$
|
2,720,115
|
|
|
$
|
2,844,681
|
|
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Three months ended
|
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Six months ended
|
||||||||||||
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Jun. 25, 2017
|
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Jun. 26, 2016
|
|
Jun. 25, 2017
|
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Jun. 26, 2016
|
||||||||
|
|
|
|
|
|
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|
||||||||
Operating revenues:
|
|
|
|
|
|
|
|
|
|
||||||
Advertising
|
$
|
445,214
|
|
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$
|
409,834
|
|
|
$
|
880,729
|
|
|
$
|
761,055
|
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Circulation
|
273,676
|
|
|
287,586
|
|
|
556,962
|
|
|
550,289
|
|
||||
Other
|
55,617
|
|
|
51,371
|
|
|
110,273
|
|
|
96,815
|
|
||||
Total operating revenues
|
774,507
|
|
|
748,791
|
|
|
1,547,964
|
|
|
1,408,159
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|
||||
|
|
|
|
|
|
|
|
||||||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of sales and operating expenses
|
485,609
|
|
|
484,824
|
|
|
994,032
|
|
|
902,780
|
|
||||
Selling, general and administrative expenses
|
210,413
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|
|
203,103
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|
|
423,118
|
|
|
368,491
|
|
||||
Depreciation
|
43,681
|
|
|
29,292
|
|
|
83,132
|
|
|
53,251
|
|
||||
Amortization
|
8,169
|
|
|
1,640
|
|
|
15,535
|
|
|
2,958
|
|
||||
Facility consolidation and asset impairment charges
|
16,131
|
|
|
3,943
|
|
|
20,610
|
|
|
4,487
|
|
||||
Total operating expenses
|
764,003
|
|
|
722,802
|
|
|
1,536,427
|
|
|
1,331,967
|
|
||||
Operating income
|
10,504
|
|
|
25,989
|
|
|
11,537
|
|
|
76,192
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Non-operating expenses:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(3,454
|
)
|
|
(3,001
|
)
|
|
(7,709
|
)
|
|
(4,857
|
)
|
||||
Other non-operating items, net (see Note 1)
|
(5,301
|
)
|
|
(1,908
|
)
|
|
(9,188
|
)
|
|
(5,878
|
)
|
||||
Total non-operating expenses
|
(8,755
|
)
|
|
(4,909
|
)
|
|
(16,897
|
)
|
|
(10,735
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Income (loss) before income taxes
|
1,749
|
|
|
21,080
|
|
|
(5,360
|
)
|
|
65,457
|
|
||||
Provision (benefit) for income taxes
|
2,236
|
|
|
8,599
|
|
|
(2,794
|
)
|
|
13,380
|
|
||||
Net income (loss)
|
$
|
(487
|
)
|
|
$
|
12,481
|
|
|
$
|
(2,566
|
)
|
|
$
|
52,077
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share – basic
|
$
|
(0.00
|
)
|
|
$
|
0.11
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.45
|
|
Earnings (loss) per share – diluted
|
$
|
(0.00
|
)
|
|
$
|
0.10
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.44
|
|
|
Three months ended
|
|
Six months ended
|
||||||||||||
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Jun. 25, 2017
|
|
Jun. 26, 2016
|
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
(487
|
)
|
|
$
|
12,481
|
|
|
$
|
(2,566
|
)
|
|
$
|
52,077
|
|
Other comprehensive income, before tax:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
8,129
|
|
|
(16,024
|
)
|
|
13,957
|
|
|
(39,073
|
)
|
||||
Pension and other postretirement benefit items:
|
|
|
|
|
|
|
|
||||||||
Amortization of prior service credit, net
|
759
|
|
|
675
|
|
|
1,511
|
|
|
1,069
|
|
||||
Amortization of actuarial loss
|
18,478
|
|
|
15,775
|
|
|
36,223
|
|
|
31,187
|
|
||||
Other
|
(9,077
|
)
|
|
9,215
|
|
|
(15,725
|
)
|
|
30,523
|
|
||||
Pension and other postretirement benefit items
|
10,160
|
|
|
25,665
|
|
|
22,009
|
|
|
62,779
|
|
||||
Other comprehensive income, before tax
|
18,289
|
|
|
9,641
|
|
|
35,966
|
|
|
23,706
|
|
||||
Income tax effect related to components of other comprehensive income
|
(5,044
|
)
|
|
(7,081
|
)
|
|
(10,380
|
)
|
|
(16,972
|
)
|
||||
Other comprehensive income, net of tax
|
13,245
|
|
|
2,560
|
|
|
25,586
|
|
|
6,734
|
|
||||
Comprehensive income
|
$
|
12,758
|
|
|
$
|
15,041
|
|
|
$
|
23,020
|
|
|
$
|
58,811
|
|
|
Six months ended
|
||||||
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
||||
|
|
|
|
||||
Operating activities:
|
|
|
|
||||
Net income (loss)
|
$
|
(2,566
|
)
|
|
$
|
52,077
|
|
Adjustments to reconcile net income to net cash flow from operating activities:
|
|
|
|
||||
Depreciation and amortization
|
98,667
|
|
|
56,209
|
|
||
Facility consolidation and asset impairment charges
|
20,610
|
|
|
4,487
|
|
||
Pension and other postretirement expenses, net of contributions
|
(7,082
|
)
|
|
(40,548
|
)
|
||
Equity (income) loss in unconsolidated investees, net
|
863
|
|
|
(1,610
|
)
|
||
Stock-based compensation
|
10,059
|
|
|
10,071
|
|
||
Change in other assets and liabilities, net
|
8,993
|
|
|
12,655
|
|
||
Net cash provided by operating activities
|
129,544
|
|
|
93,341
|
|
||
Investing activities:
|
|
|
|
||||
Capital expenditures
|
(29,831
|
)
|
|
(26,136
|
)
|
||
Payments for acquisitions, net of cash acquired
|
(31,459
|
)
|
|
(260,529
|
)
|
||
Payments for investments
|
(2,414
|
)
|
|
(8,652
|
)
|
||
Proceeds from sale of certain assets
|
3,200
|
|
|
10,418
|
|
||
Changes in other investing activities
|
52
|
|
|
—
|
|
||
Net cash used for investing activities
|
(60,452
|
)
|
|
(284,899
|
)
|
||
Financing activities:
|
|
|
|
||||
Dividends paid
|
(36,364
|
)
|
|
(55,784
|
)
|
||
Proceeds from issuance of common stock upon settlement of stock awards
|
560
|
|
|
404
|
|
||
Payments for employee taxes withheld from stock awards
|
(3,607
|
)
|
|
(3,328
|
)
|
||
Proceeds from borrowings under revolving credit agreement
|
35,000
|
|
|
250,000
|
|
||
Repayments of borrowings under revolving credit agreement
|
(50,000
|
)
|
|
(50,000
|
)
|
||
Changes in other financing activities
|
(395
|
)
|
|
—
|
|
||
Net cash (used for) provided by financing activities
|
(54,806
|
)
|
|
141,292
|
|
||
Effect of currency exchange rates change on cash
|
(1,670
|
)
|
|
(2,304
|
)
|
||
Increase (decrease) in cash and cash equivalents
|
12,616
|
|
|
(52,570
|
)
|
||
Balance of cash and cash equivalents at beginning of period
|
114,324
|
|
|
196,696
|
|
||
Balance of cash and cash equivalents at end of period
|
$
|
126,940
|
|
|
$
|
144,126
|
|
|
|
|
|
||||
Supplemental cash flow information:
|
|
|
|
||||
Cash paid for taxes, net of refunds
|
$
|
(16,518
|
)
|
|
$
|
22,809
|
|
Cash paid for interest
|
$
|
9,204
|
|
|
$
|
4,242
|
|
Non-cash investing and financing activities:
|
|
|
|
||||
Accrued capital expenditures
|
$
|
1,907
|
|
|
$
|
7,141
|
|
In thousands
|
|
||
Cash acquired
|
$
|
13,195
|
|
Other current assets
|
15,058
|
|
|
Property, plant and equipment
|
13,486
|
|
|
Intangible assets
|
88,500
|
|
|
Goodwill
|
120,716
|
|
|
Other noncurrent assets
|
9,852
|
|
|
Total assets acquired
|
260,807
|
|
|
Current liabilities
|
63,005
|
|
|
Noncurrent liabilities
|
22,059
|
|
|
Total liabilities assumed
|
85,064
|
|
|
Net assets acquired
|
$
|
175,743
|
|
In thousands
|
|
||
Cash acquired
|
$
|
36,825
|
|
Other current assets
|
54,571
|
|
|
Property, plant and equipment
|
264,357
|
|
|
Intangible assets
|
42,880
|
|
|
Goodwill
|
25,258
|
|
|
Other noncurrent assets
|
3,825
|
|
|
Total assets acquired
|
427,716
|
|
|
Current liabilities
|
71,519
|
|
|
Noncurrent liabilities
|
61,151
|
|
|
Total liabilities assumed
|
132,670
|
|
|
Net assets acquired
|
$
|
295,046
|
|
|
Six months ended
|
||
In thousands; unaudited
|
Jun. 26, 2016
|
||
Total revenues
|
$
|
1,737,315
|
|
Net income
|
$
|
29,412
|
|
Earnings per share - diluted
|
$
|
0.25
|
|
In thousands
|
Severance Activities
|
||
Balance at Dec. 25, 2016
|
$
|
18,651
|
|
Expense
|
20,265
|
|
|
Payments
|
(28,476
|
)
|
|
Balance at Jun. 25, 2017
|
$
|
10,440
|
|
In thousands
|
Three months ended
|
||||||||||||||
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
||||||||||||
|
Pension
|
|
Postretirement
|
|
Pension
|
|
Postretirement
|
||||||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Service cost-benefits earned during the period
|
$
|
400
|
|
|
$
|
26
|
|
|
$
|
727
|
|
|
$
|
34
|
|
Non-operating expenses:
|
|
|
|
|
|
|
|
||||||||
Interest cost on benefit obligation
|
27,595
|
|
|
863
|
|
|
31,287
|
|
|
887
|
|
||||
Expected return on plan assets
|
(41,961
|
)
|
|
—
|
|
|
(46,668
|
)
|
|
—
|
|
||||
Amortization of prior service cost
|
1,675
|
|
|
(916
|
)
|
|
1,685
|
|
|
(1,010
|
)
|
||||
Amortization of actuarial loss (gain)
|
18,551
|
|
|
(73
|
)
|
|
15,961
|
|
|
(186
|
)
|
||||
Total non-operating expenses (credit)
|
5,860
|
|
|
(126
|
)
|
|
2,265
|
|
|
(309
|
)
|
||||
Total expense for retirement plans
|
$
|
6,260
|
|
|
$
|
(100
|
)
|
|
$
|
2,992
|
|
|
$
|
(275
|
)
|
|
|
|
|
|
|
|
|
||||||||
|
Six months ended
|
||||||||||||||
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
||||||||||||
|
Pension
|
|
Postretirement
|
|
Pension
|
|
Postretirement
|
||||||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Service cost-benefits earned during the period
|
$
|
1,220
|
|
|
$
|
78
|
|
|
$
|
1,628
|
|
|
$
|
97
|
|
Non-operating expenses:
|
|
|
|
|
|
|
|
||||||||
Interest cost on benefit obligation
|
55,374
|
|
|
1,804
|
|
|
63,718
|
|
|
1,874
|
|
||||
Expected return on plan assets
|
(84,378
|
)
|
|
—
|
|
|
(93,148
|
)
|
|
—
|
|
||||
Amortization of prior service cost
|
3,335
|
|
|
(1,824
|
)
|
|
3,329
|
|
|
(2,260
|
)
|
||||
Amortization of actuarial loss
|
36,171
|
|
|
52
|
|
|
31,123
|
|
|
64
|
|
||||
Total non-operating expenses (credit)
|
10,502
|
|
|
32
|
|
|
5,022
|
|
|
(322
|
)
|
||||
Total expense for retirement plans
|
$
|
11,722
|
|
|
$
|
110
|
|
|
$
|
6,650
|
|
|
$
|
(225
|
)
|
In thousands
|
Six months ended
|
||||||
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
||||
Balance at beginning of period
|
$
|
856,761
|
|
|
$
|
1,058,576
|
|
Comprehensive income:
|
|
|
|
||||
Net income
|
(2,566
|
)
|
|
52,077
|
|
||
Other comprehensive income
|
25,586
|
|
|
6,734
|
|
||
Total comprehensive income
|
23,020
|
|
|
58,811
|
|
||
Dividends declared
|
(36,364
|
)
|
|
(37,283
|
)
|
||
Stock-based compensation
|
10,059
|
|
|
10,071
|
|
||
Other activity
|
(2,986
|
)
|
|
15,364
|
|
||
Balance at end of period
|
$
|
850,490
|
|
|
$
|
1,105,539
|
|
In thousands
|
Retirement Plans
|
|
Foreign Currency Translation
|
|
Total
|
||||||
Balance at Dec. 25, 2016
|
$
|
(1,183,196
|
)
|
|
$
|
300,284
|
|
|
$
|
(882,912
|
)
|
Other comprehensive income (loss) before reclassifications
|
(12,639
|
)
|
|
13,957
|
|
|
1,318
|
|
|||
Amounts reclassified from accumulated other comprehensive income
|
24,268
|
|
|
—
|
|
|
24,268
|
|
|||
Other comprehensive income
|
11,629
|
|
|
13,957
|
|
|
25,586
|
|
|||
Balance at Jun. 25, 2017
|
$
|
(1,171,567
|
)
|
|
$
|
314,241
|
|
|
$
|
(857,326
|
)
|
|
|
|
|
|
|
||||||
Balance at Dec. 27, 2015
|
$
|
(1,058,234
|
)
|
|
$
|
384,810
|
|
|
$
|
(673,424
|
)
|
Other comprehensive income (loss) before reclassifications
|
25,057
|
|
|
(39,073
|
)
|
|
(14,016
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss
|
20,750
|
|
|
—
|
|
|
20,750
|
|
|||
Other comprehensive income (loss)
|
45,807
|
|
|
(39,073
|
)
|
|
6,734
|
|
|||
Balance at Jun. 26, 2016
|
$
|
(1,012,427
|
)
|
|
$
|
345,737
|
|
|
$
|
(666,690
|
)
|
In thousands
|
Three months ended
|
|
Six months ended
|
||||||||||||
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
||||||||
Amortization of prior service credit, net
|
$
|
759
|
|
|
$
|
675
|
|
|
$
|
1,511
|
|
|
$
|
1,069
|
|
Amortization of actuarial loss
|
18,478
|
|
|
15,775
|
|
|
36,223
|
|
|
31,187
|
|
||||
Total reclassifications, before tax
|
19,237
|
|
|
16,450
|
|
|
37,734
|
|
|
32,256
|
|
||||
Income tax effect
|
(6,867
|
)
|
|
(5,876
|
)
|
|
(13,466
|
)
|
|
(11,506
|
)
|
||||
Total reclassifications, net of tax
|
$
|
12,370
|
|
|
$
|
10,574
|
|
|
$
|
24,268
|
|
|
$
|
20,750
|
|
In thousands, except per share data
|
Three months ended
|
|
Six months ended
|
||||||||||||
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
||||||||
Net income (loss)
|
$
|
(487
|
)
|
|
$
|
12,481
|
|
|
$
|
(2,566
|
)
|
|
$
|
52,077
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of shares outstanding - basic
|
113,652
|
|
|
116,516
|
|
|
113,574
|
|
|
116,414
|
|
||||
Effect of dilutive securities
|
|
|
|
|
|
|
|
||||||||
Restricted stock units
|
—
|
|
|
1,642
|
|
|
—
|
|
|
1,536
|
|
||||
Performance share units
|
—
|
|
|
954
|
|
|
—
|
|
|
991
|
|
||||
Stock options
|
—
|
|
|
265
|
|
|
—
|
|
|
277
|
|
||||
Weighted average number of shares outstanding - diluted
|
113,652
|
|
|
119,377
|
|
|
113,574
|
|
|
119,218
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share - basic
|
$
|
(0.00
|
)
|
|
$
|
0.11
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.45
|
|
Earnings (loss) per share - diluted
|
$
|
(0.00
|
)
|
|
$
|
0.10
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.44
|
|
•
|
Publishing, which consists of our portfolio of local, regional, national, and international newspaper publishers. The results of this segment include retail, classified, and national advertising revenues consisting of both print and
|
•
|
ReachLocal, which consists of our ReachLocal digital marketing solutions subsidiaries and SweetIQ. The results of this segment include advertising revenues from our search and display services and other revenues related to web presence and software solutions provided by ReachLocal.
|
In thousands
|
Publishing
|
|
ReachLocal
|
|
Corporate and Other
|
|
Intersegment Eliminations
|
|
Consolidated
|
||||||||||
Three months ended Jun. 25, 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
Advertising - external sales
|
$
|
369,001
|
|
|
$
|
76,213
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
445,214
|
|
Advertising - intersegment sales
|
3,959
|
|
|
—
|
|
|
—
|
|
|
(3,959
|
)
|
|
—
|
|
|||||
Circulation
|
273,676
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
273,676
|
|
|||||
Other - external sales
|
44,863
|
|
|
9,713
|
|
|
1,041
|
|
|
—
|
|
|
55,617
|
|
|||||
Other - intersegment sales
|
681
|
|
|
—
|
|
|
—
|
|
|
(681
|
)
|
|
—
|
|
|||||
Total revenues
|
$
|
692,180
|
|
|
$
|
85,926
|
|
|
$
|
1,041
|
|
|
$
|
(4,640
|
)
|
|
$
|
774,507
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
104,120
|
|
|
$
|
1,217
|
|
|
$
|
(21,683
|
)
|
|
$
|
—
|
|
|
$
|
83,654
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Three months ended Jun. 26, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Advertising
|
$
|
409,834
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
409,834
|
|
Circulation
|
287,586
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
287,586
|
|
|||||
Other
|
50,652
|
|
|
—
|
|
|
719
|
|
|
—
|
|
|
51,371
|
|
|||||
Total revenues
|
$
|
748,072
|
|
|
$
|
—
|
|
|
$
|
719
|
|
|
$
|
—
|
|
|
$
|
748,791
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
114,269
|
|
|
$
|
—
|
|
|
$
|
(22,619
|
)
|
|
$
|
—
|
|
|
$
|
91,650
|
|
In thousands
|
Publishing
|
|
ReachLocal
|
|
Corporate and Other
|
|
Intersegment Eliminations
|
|
Consolidated
|
||||||||||
Six months ended Jun. 25, 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
Advertising - external sales
|
$
|
734,086
|
|
|
$
|
146,695
|
|
|
$
|
(52
|
)
|
|
$
|
—
|
|
|
$
|
880,729
|
|
Advertising - intersegment sales
|
3,959
|
|
|
—
|
|
|
—
|
|
|
(3,959
|
)
|
|
—
|
|
|||||
Circulation
|
556,962
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
556,962
|
|
|||||
Other - external sales
|
91,416
|
|
|
16,796
|
|
|
2,061
|
|
|
—
|
|
|
110,273
|
|
|||||
Other - intersegment sales
|
681
|
|
|
—
|
|
|
—
|
|
|
(681
|
)
|
|
—
|
|
|||||
Total revenues
|
$
|
1,387,104
|
|
|
$
|
163,491
|
|
|
$
|
2,009
|
|
|
$
|
(4,640
|
)
|
|
$
|
1,547,964
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
195,784
|
|
|
$
|
4,363
|
|
|
$
|
(46,812
|
)
|
|
$
|
—
|
|
|
$
|
153,335
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Six months ended Jun. 26, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Advertising
|
$
|
761,055
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
761,055
|
|
Circulation
|
550,289
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
550,289
|
|
|||||
Other
|
94,707
|
|
|
—
|
|
|
2,108
|
|
|
—
|
|
|
96,815
|
|
|||||
Total revenues
|
$
|
1,406,051
|
|
|
$
|
—
|
|
|
$
|
2,108
|
|
|
$
|
—
|
|
|
$
|
1,408,159
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
211,790
|
|
|
$
|
—
|
|
|
$
|
(39,769
|
)
|
|
$
|
—
|
|
|
$
|
172,021
|
|
In thousands
|
Three months ended
|
|
Six months ended
|
||||||||||||
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
|
Jun. 25, 2017
|
|
Jun. 26, 2016
|
||||||||
Net income (loss) (GAAP basis)
|
$
|
(487
|
)
|
|
$
|
12,481
|
|
|
$
|
(2,566
|
)
|
|
$
|
52,077
|
|
Provision (benefit) for income taxes
|
2,236
|
|
|
8,599
|
|
|
(2,794
|
)
|
|
13,380
|
|
||||
Interest expense
|
3,454
|
|
|
3,001
|
|
|
7,709
|
|
|
4,857
|
|
||||
Other non-operating items, net
|
5,301
|
|
|
1,908
|
|
|
9,188
|
|
|
5,878
|
|
||||
Operating income (GAAP basis)
|
10,504
|
|
|
25,989
|
|
|
11,537
|
|
|
76,192
|
|
||||
Severance-related charges
|
8,415
|
|
|
17,998
|
|
|
20,265
|
|
|
21,694
|
|
||||
Acquisition-related expenses
|
1,570
|
|
|
12,788
|
|
|
2,593
|
|
|
14,639
|
|
||||
Facility consolidation and asset impairment charges
|
16,131
|
|
|
3,943
|
|
|
20,610
|
|
|
4,487
|
|
||||
Other items
|
(4,816
|
)
|
|
—
|
|
|
(337
|
)
|
|
(1,200
|
)
|
||||
Depreciation
|
43,681
|
|
|
29,292
|
|
|
83,132
|
|
|
53,251
|
|
||||
Amortization
|
8,169
|
|
|
1,640
|
|
|
15,535
|
|
|
2,958
|
|
||||
Adjusted EBITDA (non-GAAP basis)
|
$
|
83,654
|
|
|
$
|
91,650
|
|
|
$
|
153,335
|
|
|
$
|
172,021
|
|
•
|
SweetIQ
– In
April 2017
, we completed the acquisition of SweetIQ Analytics Corp. (SweetIQ) for approximately
$31.6 million
, net of cash acquired. SweetIQ has a platform that provides services which enable customers to launch and execute marketing campaigns to convert online searches to in-store foot traffic. SweetIQ's customers include businesses with multi location brands and agencies that target local marketing.
|
•
|
ReachLocal
– In
August 2016
, we completed the acquisition of
100%
of the outstanding common stock of ReachLocal for approximately
$162.5 million
, net of cash acquired. ReachLocal offers online marketing, digital advertising, software-as-a-service, and web presence products and solutions to local businesses. In connection with the ReachLocal acquisition, we established a newly formed separate reportable segment that reflects its results since the acquisition date.
|
•
|
Certain assets of North Jersey Media Group (NJMG)
– In
July 2016
, we completed the acquisition of certain assets of NJMG for approximately
$39.3 million
. NJMG is a media company with print and digital publishing operations serving primarily the northern New Jersey market.
|
•
|
Journal Media Group (JMG)
– In
April 2016
, we completed the acquisition of
100%
of the outstanding common stock of JMG for approximately
$260.6 million
, net of cash acquired. JMG is a media company with print and digital publishing operations serving
15
U.S. markets in
9
states.
|
•
|
Facility consolidation and asset impairment charges
– Facility consolidation and other cost savings plans led us to recognize asset impairment charges, shutdown costs, and charges associated with revising the useful lives of certain assets over a shortened period. As part of our plans, we are selling certain assets which we have classified as held-for-sale and reduced the carrying values to equal the fair value less cost to dispose. We recorded pre-tax charges for facility consolidations and asset impairments of
$16.1 million
and
$3.9 million
for the
second quarter
of
2017
and the
second quarter
of
2016
, respectively, and
$20.6 million
and
$4.5 million
year-to-date
2017
and
2016
, respectively. In addition, we incurred accelerated depreciation of
$13.8 million
and
$23.6 million
for the
three
and
six months ended
June 25, 2017
, respectively. No accelerated deprecation was incurred for the
three
and
six months ended
June 26, 2016
.
|
•
|
Severance-related expenses
– During
2017
and
2016
, we initiated various cost reducing actions associated with our facility consolidation and other cost efficiency efforts that are severance related, of which we incurred
$8.4 million
and
$18.0 million
for the
second quarter
of
2017
and
2016
, respectively, and
$20.3 million
and
$21.7 million
year-to-date
2017
and
2016
, respectively.
|
•
|
Foreign currency
– Our earnings from operations in foreign regions are translated into U.S. dollars at average exchange rates prevailing during the period, and assets and liabilities are translated at exchange rates in effect at the balance sheet date. With respect to Newsquest, results for the
second quarter
of
2017
were translated from the British pound sterling to U.S. dollars at an average rate of
1.28
compared to
1.44
for the comparable period last year. This
11%
decline in the exchange rate unfavorably impacted
second quarter
2017
revenue comparisons by approximately
$9.1 million
. Newsquest results for the
six months ended
June 25, 2017
were translated from the British pound sterling to U.S. dollars at an average rate of
1.26
compared to
1.44
for the comparable period last year. Impacts stemming from foreign currency translation gains and losses for ReachLocal are immaterial to date.
|
In thousands
|
Quarter-to-Date
|
|
Year-to-Date
|
||||||||||||||||||
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Operating revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Publishing
|
$
|
692,180
|
|
|
$
|
748,072
|
|
|
(7
|
%)
|
|
$
|
1,387,104
|
|
|
$
|
1,406,051
|
|
|
(1
|
%)
|
ReachLocal
|
85,926
|
|
|
—
|
|
|
100
|
%
|
|
163,491
|
|
|
—
|
|
|
100
|
%
|
||||
Corporate and Other
|
1,041
|
|
|
719
|
|
|
45
|
%
|
|
2,009
|
|
|
2,108
|
|
|
(5
|
%)
|
||||
Intersegment eliminations
|
(4,640
|
)
|
|
—
|
|
|
100
|
%
|
|
(4,640
|
)
|
|
—
|
|
|
100
|
%
|
||||
Total operating revenues
|
774,507
|
|
|
748,791
|
|
|
3
|
%
|
|
1,547,964
|
|
|
1,408,159
|
|
|
10
|
%
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Publishing
|
639,974
|
|
|
682,854
|
|
|
(6
|
%)
|
|
1,291,379
|
|
|
1,267,995
|
|
|
2
|
%
|
||||
ReachLocal
|
93,815
|
|
|
—
|
|
|
100
|
%
|
|
176,152
|
|
|
—
|
|
|
100
|
%
|
||||
Corporate and Other
|
34,854
|
|
|
39,948
|
|
|
(13
|
%)
|
|
73,536
|
|
|
63,972
|
|
|
15
|
%
|
||||
Intersegment eliminations
|
(4,640
|
)
|
|
—
|
|
|
100
|
%
|
|
(4,640
|
)
|
|
—
|
|
|
100
|
%
|
||||
Total operating expenses
|
764,003
|
|
|
722,802
|
|
|
6
|
%
|
|
1,536,427
|
|
|
1,331,967
|
|
|
15
|
%
|
||||
Operating income
|
10,504
|
|
|
25,989
|
|
|
(60
|
%)
|
|
11,537
|
|
|
76,192
|
|
|
(85
|
%)
|
||||
Non-operating expense
|
(8,755
|
)
|
|
(4,909
|
)
|
|
78
|
%
|
|
(16,897
|
)
|
|
(10,735
|
)
|
|
57
|
%
|
||||
Income (loss) before income taxes
|
1,749
|
|
|
21,080
|
|
|
(92
|
%)
|
|
(5,360
|
)
|
|
65,457
|
|
|
***
|
|
||||
Provision (benefit) for income taxes
|
2,236
|
|
|
8,599
|
|
|
(74
|
%)
|
|
(2,794
|
)
|
|
13,380
|
|
|
***
|
|
||||
Net income (loss)
|
$
|
(487
|
)
|
|
$
|
12,481
|
|
|
***
|
|
|
$
|
(2,566
|
)
|
|
$
|
52,077
|
|
|
***
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings (loss) per share
|
$
|
(0.00
|
)
|
|
$
|
0.10
|
|
|
***
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.44
|
|
|
***
|
|
•
|
Reported revenues or expenses
|
•
|
Less: revenues or expenses for our
2016
publishing acquisitions from the beginning of fiscal year
2017
through the
|
•
|
Less: operations exited in
2016
|
•
|
Add (less): decreases (increases) in foreign currency translation impacts based on a constant currency calculation
|
In thousands
|
Quarter-to-Date
|
|
Year-to-Date
|
||||||||||||||||||
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Operating revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Advertising
|
$
|
372,960
|
|
|
$
|
409,834
|
|
|
(9
|
%)
|
|
$
|
737,993
|
|
|
$
|
761,055
|
|
|
(3
|
%)
|
Circulation
|
273,676
|
|
|
287,586
|
|
|
(5
|
%)
|
|
556,962
|
|
|
550,289
|
|
|
1
|
%
|
||||
Other
|
45,544
|
|
|
50,652
|
|
|
(10
|
%)
|
|
92,149
|
|
|
94,707
|
|
|
(3
|
%)
|
||||
Total operating revenues
|
692,180
|
|
|
748,072
|
|
|
(7
|
%)
|
|
1,387,104
|
|
|
1,406,051
|
|
|
(1
|
%)
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of sales
|
435,934
|
|
|
482,607
|
|
|
(10
|
%)
|
|
896,312
|
|
|
898,579
|
|
|
—
|
%
|
||||
Selling, general, and administrative expenses
|
150,271
|
|
|
169,194
|
|
|
(11
|
%)
|
|
303,394
|
|
|
316,176
|
|
|
(4
|
%)
|
||||
Depreciation
|
36,344
|
|
|
25,470
|
|
|
43
|
%
|
|
68,487
|
|
|
45,795
|
|
|
50
|
%
|
||||
Amortization
|
1,294
|
|
|
1,640
|
|
|
(21
|
%)
|
|
2,576
|
|
|
2,958
|
|
|
(13
|
%)
|
||||
Facility consolidation and impairment charges
|
16,131
|
|
|
3,943
|
|
|
***
|
|
|
20,610
|
|
|
4,487
|
|
|
***
|
|
||||
Total operating expenses
|
639,974
|
|
|
682,854
|
|
|
(6
|
%)
|
|
1,291,379
|
|
|
1,267,995
|
|
|
2
|
%
|
||||
Operating income
|
$
|
52,206
|
|
|
$
|
65,218
|
|
|
(20
|
%)
|
|
$
|
95,725
|
|
|
$
|
138,056
|
|
|
(31
|
%)
|
In thousands
|
Quarter-to-Date
|
|
Year-to-Date
|
||||||||||||||||||
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Operating income (GAAP basis)
|
$
|
52,206
|
|
|
$
|
65,218
|
|
|
(20
|
%)
|
|
$
|
95,725
|
|
|
$
|
138,056
|
|
|
(31
|
%)
|
Severance-related charges
|
5,340
|
|
|
17,998
|
|
|
(70
|
%)
|
|
15,760
|
|
|
21,694
|
|
|
(27
|
%)
|
||||
Acquisition-related expenses
|
244
|
|
|
—
|
|
|
100
|
%
|
|
(89
|
)
|
|
—
|
|
|
100
|
%
|
||||
Facility consolidation and asset impairment charges
|
16,131
|
|
|
3,943
|
|
|
***
|
|
|
20,610
|
|
|
4,487
|
|
|
***
|
|
||||
Other items
|
(7,439
|
)
|
|
—
|
|
|
***
|
|
|
(7,285
|
)
|
|
(1,200
|
)
|
|
***
|
|
||||
Depreciation
|
36,344
|
|
|
25,470
|
|
|
43
|
%
|
|
68,487
|
|
|
45,795
|
|
|
50
|
%
|
||||
Amortization
|
1,294
|
|
|
1,640
|
|
|
(21
|
%)
|
|
2,576
|
|
|
2,958
|
|
|
(13
|
%)
|
||||
Adjusted EBITDA (non-GAAP basis)
|
$
|
104,120
|
|
|
$
|
114,269
|
|
|
(9
|
%)
|
|
$
|
195,784
|
|
|
$
|
211,790
|
|
|
(8
|
%)
|
In thousands
|
Quarter-to-Date
|
|
Year-to-Date
|
||||
|
2017
|
|
2017
|
||||
Operating revenues:
|
|
|
|
||||
Advertising
|
$
|
76,213
|
|
|
$
|
146,695
|
|
Other
|
9,713
|
|
|
16,796
|
|
||
Total operating revenues
|
85,926
|
|
|
163,491
|
|
||
Operating expenses:
|
|
|
|
||||
Cost of sales
|
50,592
|
|
|
95,170
|
|
||
Selling, general, and administrative expenses
|
34,440
|
|
|
64,324
|
|
||
Depreciation
|
1,908
|
|
|
3,699
|
|
||
Amortization
|
6,875
|
|
|
12,959
|
|
||
Total operating expenses
|
93,815
|
|
|
176,152
|
|
||
Operating loss
|
$
|
(7,889
|
)
|
|
$
|
(12,661
|
)
|
As of date
|
Jun. 25, 2017
|
|
Dec. 25, 2016
|
||
Active Clients
(1)
|
19,400
|
|
|
15,300
|
|
Active Product Units
(2)
|
36,800
|
|
|
27,900
|
|
(1)
|
Active Clients is a number calculated to approximate the number of clients served. Active Clients is calculated by adjusting the number of Active Product Units to combine clients with more than one Active Product Unit as a single Active Client. Clients with more than one location are generally reflected as multiple Active Clients. This number includes clients with which ReachLocal does not have a direct client relationship. Numbers are rounded to the nearest hundred.
|
(2)
|
Active Product Units is a number we calculate to approximate the number of individual products, licenses, or services we are providing under contract for Active Clients. For example, if we were performing both ReachSearch and ReachDisplay campaigns for a client that also licenses ReachEdge, we consider that three Active Product Units. Similarly, if a client purchases ReachSearch campaigns for two different products or purposes, we consider that two Active Product Units. Numbers are rounded to the nearest hundred.
|
In thousands
|
Quarter-to-Date
|
|
Year-to-Date
|
||||
|
2017
|
|
2017
|
||||
Operating income (GAAP basis)
|
$
|
(7,889
|
)
|
|
$
|
(12,661
|
)
|
Severance-related charges
|
323
|
|
|
323
|
|
||
Acquisition-related expenses
|
—
|
|
|
43
|
|
||
Depreciation
|
1,908
|
|
|
3,699
|
|
||
Amortization
|
6,875
|
|
|
12,959
|
|
||
Adjusted EBITDA (non-GAAP basis)
|
$
|
1,217
|
|
|
$
|
4,363
|
|
In thousands
|
Year-to-date
|
||||||
|
2017
|
|
2016
|
||||
Net cash provided by operating activities
|
$
|
129,544
|
|
|
$
|
93,341
|
|
Net cash used for investing activities
|
(60,452
|
)
|
|
(284,899
|
)
|
||
Net cash (used for) provided by financing activities
|
(54,806
|
)
|
|
141,292
|
|
||
Effect of currency exchange rate change on cash
|
(1,670
|
)
|
|
(2,304
|
)
|
||
Net increase (decrease) in cash
|
$
|
12,616
|
|
|
$
|
(52,570
|
)
|
•
|
Adjusted EBITDA
is a non-GAAP financial performance measure we believe offers a useful view of the overall operation of our businesses. Adjusted EBITDA is defined as net income before (1) income taxes, (2) interest expense, (3) equity income, (4) other non-operating items, (5) severance-related charges, (6) acquisition-related expenses (including certain integration expenses), (7) facility consolidation and asset impairment charges, (8) other items (including certain business transformation costs, litigation expenses and multi-employer pension withdrawals), (9) depreciation, and (10) amortization. When adjusted EBITDA is discussed in this report, the most directly comparable GAAP financial measure is net income.
|
•
|
Adjusted net income
is a non-GAAP financial performance measure we use for calculating adjusted EPS. Adjusted net income is defined as net income before the adjustments we apply in calculating adjusted EPS as described below. We believe presenting adjusted net income is useful to enable investors to understand how we calculate adjusted EPS, which provides a useful view of the overall operation of our business. The most directly comparable GAAP financial measure is net income.
|
•
|
Adjusted EPS
is a non-GAAP financial performance measure we believe offers a useful view of the overall operation of our business. We define adjusted EPS, which may not be comparable to a similarly titled measure reported by other companies, as EPS before tax-effected (1) severance-related charges, (2) facility consolidation and asset impairment charges, (3) acquisition-related expenses (including certain integration expenses), and (4) other items (including certain business transformation expenses, litigation expenses and multi-employer pension withdrawals). The tax impact on these non-GAAP tax deductible adjustments is based on the estimated statutory tax rates for the U.K. of 19.25% and the U.S. of 38.7%. In addition, tax is adjusted for the impact of non-deductible acquisition costs. When adjusted EPS is discussed in this report, the most directly comparable GAAP financial measure is diluted EPS.
|
•
|
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. We define free cash flow, which may not be comparable to a similarly titled measure reported by other companies, as cash flow from operating activities 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.
|
In thousands
|
Quarter-to-Date
|
|
Year-to-Date
|
||||||||||||||||||
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Net income (loss) (GAAP basis)
|
$
|
(487
|
)
|
|
$
|
12,481
|
|
|
***
|
|
|
$
|
(2,566
|
)
|
|
$
|
52,077
|
|
|
***
|
|
Provision (benefit) for income taxes
|
2,236
|
|
|
8,599
|
|
|
(74
|
%)
|
|
(2,794
|
)
|
|
13,380
|
|
|
***
|
|
||||
Interest expense
|
3,454
|
|
|
3,001
|
|
|
15
|
%
|
|
7,709
|
|
|
4,857
|
|
|
59
|
%
|
||||
Other non-operating items, net
|
5,301
|
|
|
1,908
|
|
|
***
|
|
|
9,188
|
|
|
5,878
|
|
|
56
|
%
|
||||
Operating income (GAAP basis)
|
10,504
|
|
|
25,989
|
|
|
(60
|
%)
|
|
11,537
|
|
|
76,192
|
|
|
(85
|
%)
|
||||
Severance-related charges
|
8,415
|
|
|
17,998
|
|
|
(53
|
%)
|
|
20,265
|
|
|
21,694
|
|
|
(7
|
%)
|
||||
Acquisition-related expenses
|
1,570
|
|
|
12,788
|
|
|
(88
|
%)
|
|
2,593
|
|
|
14,639
|
|
|
(82
|
%)
|
||||
Facility consolidation and asset impairment charges
|
16,131
|
|
|
3,943
|
|
|
***
|
|
|
20,610
|
|
|
4,487
|
|
|
***
|
|
||||
Other items
|
(4,816
|
)
|
|
—
|
|
|
100
|
%
|
|
(337
|
)
|
|
(1,200
|
)
|
|
(72
|
%)
|
||||
Depreciation
|
43,681
|
|
|
29,292
|
|
|
49
|
%
|
|
83,132
|
|
|
53,251
|
|
|
56
|
%
|
||||
Amortization
|
8,169
|
|
|
1,640
|
|
|
***
|
|
|
15,535
|
|
|
2,958
|
|
|
***
|
|
||||
Adjusted EBITDA (non-GAAP basis)
|
$
|
83,654
|
|
|
$
|
91,650
|
|
|
(9
|
%)
|
|
$
|
153,335
|
|
|
$
|
172,021
|
|
|
(11
|
%)
|
In thousands, except per share data
|
Quarter-to-Date
|
|
Year-to-Date
|
||||||||||||||||||
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Severance-related charges
|
$
|
8,415
|
|
|
$
|
17,998
|
|
|
(53
|
%)
|
|
$
|
20,265
|
|
|
$
|
21,694
|
|
|
(7
|
%)
|
Acquisition-related expenses
|
1,570
|
|
|
12,788
|
|
|
(88
|
%)
|
|
2,593
|
|
|
14,639
|
|
|
(82
|
%)
|
||||
Facility consolidation and asset impairment charges (including accelerated depreciation)
|
29,929
|
|
|
3,943
|
|
|
***
|
|
|
44,347
|
|
|
4,550
|
|
|
***
|
|
||||
Other Items
|
(4,702
|
)
|
|
—
|
|
|
100
|
%
|
|
(3,198
|
)
|
|
(1,200
|
)
|
|
***
|
|
||||
Pre-tax impact
|
35,212
|
|
|
34,729
|
|
|
1
|
%
|
|
64,007
|
|
|
39,683
|
|
|
61
|
%
|
||||
Income tax impact of above items
|
(13,394
|
)
|
|
(10,864
|
)
|
|
23
|
%
|
|
(24,432
|
)
|
|
(12,657
|
)
|
|
93
|
%
|
||||
Impact of items affecting comparability on net income
|
$
|
21,818
|
|
|
$
|
23,865
|
|
|
(9
|
%)
|
|
$
|
39,575
|
|
|
$
|
27,026
|
|
|
46
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) (GAAP basis)
|
$
|
(487
|
)
|
|
$
|
12,481
|
|
|
***
|
|
|
$
|
(2,566
|
)
|
|
$
|
52,077
|
|
|
***
|
|
Impact of items affecting comparability on net income (loss)
|
21,818
|
|
|
23,865
|
|
|
(9
|
%)
|
|
39,575
|
|
|
27,026
|
|
|
46
|
%
|
||||
Adjusted net income (non-GAAP basis)
|
$
|
21,331
|
|
|
$
|
36,346
|
|
|
(41
|
%)
|
|
$
|
37,009
|
|
|
$
|
79,103
|
|
|
(53
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings (loss) per share - diluted (GAAP basis)
|
$
|
(0.00
|
)
|
|
$
|
0.10
|
|
|
***
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.44
|
|
|
***
|
|
Impact of items affecting comparability on net income (loss)
|
0.18
|
|
|
0.20
|
|
|
(10
|
%)
|
|
0.34
|
|
|
0.22
|
|
|
55
|
%
|
||||
Adjusted earnings per share - diluted (non-GAAP basis)
|
$
|
0.18
|
|
|
$
|
0.30
|
|
|
(40
|
%)
|
|
$
|
0.32
|
|
|
$
|
0.66
|
|
|
(52
|
%)
|
Diluted weighted average number of common shares outstanding (GAAP basis)
|
113,652
|
|
|
119,377
|
|
|
(5
|
%)
|
|
113,574
|
|
|
119,218
|
|
|
(5
|
%)
|
||||
Diluted weighted average number of common shares outstanding (non-GAAP basis)
|
115,918
|
|
|
119,377
|
|
|
(3
|
%)
|
|
115,595
|
|
|
119,218
|
|
|
(3
|
%)
|
In thousands
|
Quarter-to-Date
|
|
Year-to-Date
|
||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||
Weighted average number of shares outstanding - basic (GAAP basis)
|
113,652
|
|
|
116,516
|
|
|
113,574
|
|
|
116,414
|
|
Effect of dilutive securities (GAAP basis)
|
|
|
|
|
|
|
|
||||
Restricted stock units
|
—
|
|
|
1,642
|
|
|
—
|
|
|
1,536
|
|
Performance share units
|
—
|
|
|
954
|
|
|
—
|
|
|
991
|
|
Stock options
|
—
|
|
|
265
|
|
|
—
|
|
|
277
|
|
Weighted average number of shares outstanding - diluted (GAAP basis)
|
113,652
|
|
|
119,377
|
|
|
113,574
|
|
|
119,218
|
|
Effect of dilutive securities (non-GAAP basis)
|
|
|
|
|
|
|
|
||||
Restricted stock units
|
1,323
|
|
|
—
|
|
|
1,298
|
|
|
—
|
|
Performance share units
|
825
|
|
|
—
|
|
|
587
|
|
|
—
|
|
Stock options
|
118
|
|
|
—
|
|
|
136
|
|
|
—
|
|
Weighted average number of shares outstanding - diluted
(non-GAAP basis)
|
115,918
|
|
|
119,377
|
|
|
115,595
|
|
|
119,218
|
|
In thousands
|
Year-to-Date
|
||||||
|
2017
|
|
2016
|
||||
Net cash flow provided by operating activities (GAAP basis)
|
$
|
129,544
|
|
|
$
|
93,341
|
|
Capital expenditures
|
(29,831
|
)
|
|
(26,136
|
)
|
||
Free cash flow (non-GAAP basis)
|
$
|
99,713
|
|
|
$
|
67,205
|
|
•
|
Macroeconomic trends and conditions;
|
•
|
An accelerated decline in general print readership and/or advertiser patterns as a result of competitive alternative media or other factors;
|
•
|
An inability to adapt to technological changes or grow our digital businesses;
|
•
|
Risks associated with the operation of an increasingly digital business, such as rapid technological changes, frequent new product introductions, declines in web traffic levels, technical failures and proliferation of ad blocking technologies;
|
•
|
Competitive pressures in the markets in which we operate;
|
•
|
An increase in newsprint costs over the levels anticipated;
|
•
|
Potential disruption or interruption of our IT systems due to accidents, extraordinary weather events, civil unrest, political events, terrorism or cyber security attacks;
|
•
|
Variability in the exchange rate relative to the U.S. dollar of currencies in foreign jurisdictions in which we operate;
|
•
|
Risks and uncertainties related to strategic acquisitions or investments, including distraction of management attention, incurrence of additional debt, integration challenges, and failure to realize expected benefits or synergies or to operate businesses effectively following acquisitions;
|
•
|
Risks and uncertainties associated with our ReachLocal segment, including its significant reliance on Google for media purchases, its international operations and its ability to develop and gain market acceptance for new products or services;
|
•
|
Our ability to protect our intellectual property or defend successfully against infringement claims;
|
•
|
Our ability to attract and retain talent;
|
•
|
Labor relations, including, but not limited to, labor disputes which may cause business interruptions, revenue declines or increased labor costs;
|
•
|
Risks associated with our underfunded pension plans;
|
•
|
Adverse outcomes in litigation or proceedings with governmental authorities or administrative agencies, or changes in the regulatory environment, any of which could encumber or impede our efforts to improve operating results or the value of assets;
|
•
|
Our inability to engage in certain corporate transactions following the separation;
|
•
|
Volatility in financial and credit markets which could affect the value of retirement plan assets and our ability to raise funds through debt or equity issuances and otherwise affect our ability to access the credit and capital markets at the times and in the amounts needed and on acceptable terms; and
|
•
|
Other uncertainties relating to general economic, political, business, industry, regulatory and market conditions.
|
Date: August 3, 2017
|
GANNETT CO., INC.
|
|
|
|
/s/ Alison K. Engel
|
|
Alison K. Engel
|
|
Senior Vice President, Chief Financial Officer and Treasurer
|
|
(on behalf of Registrant and as Principal Financial Officer)
|
4-1
|
|
Amendment to 2015 Omnibus Incentive Compensation Plan
|
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed by the Company with the SEC on May 11, 2017.
|
|
|
|
|
|
10-1
|
|
Gannett Co., Inc. 2015 Deferred Compensation Plan Rules for Post-2004 Deferrals, Amendment No. 2, effective as of June 1, 2017
|
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed by the Company with the SEC on June 6, 2017.
|
|
|
|
|
|
10-2
|
|
Gannett Co., Inc. 2015 Deferred Compensation Plan Rules for Pre-2005 Deferrals, Amendment No. 1, effective as of June 1, 2017
|
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed by the Company with the SEC on June 6, 2017.
|
|
|
|
|
|
10-3
|
|
2015 Change in Control Severance Plan, as amended as of July 20, 2017
|
|
Attached.
|
|
|
|
|
|
10-4
|
|
Executive Severance Plan, as amended as of July 20, 2017
|
|
Attached.
|
|
|
|
|
|
31-1
|
|
Rule 13a-14(a) Certification of CEO
|
|
Attached.
|
|
|
|
|
|
31-2
|
|
Rule 13a-14(a) Certification of CFO
|
|
Attached.
|
|
|
|
|
|
32-1
|
|
Section 1350 Certification of CEO
|
|
Attached.
|
|
|
|
|
|
32-2
|
|
Section 1350 Certification of CFO
|
|
Attached.
|
|
|
|
|
|
101
|
|
The following financial information from Gannett Co., Inc. Quarterly Report on Form 10-Q for the quarter ended June 25, 2017, formatted in XBRL: (i) Unaudited Condensed Consolidated Balance Sheets at June 25, 2017 and December 25, 2016, (ii) Unaudited Condensed Consolidated Statements of Income (Loss) for the fiscal quarters and six months ended June 25, 2017 and June 26, 2016, (iii) Unaudited Condensed Consolidated Statements of Comprehensive Income for the fiscal quarters and six months ended June 25, 2017 and June 26, 2016, (iv) Unaudited Condensed Consolidated Cash Flow Statements for the six months ended June 25, 2017 and June 26, 2016, and (v) Unaudited Notes to Condensed Consolidated Financial Statements
|
|
Attached.
|
▪
|
Payment of the severance amounts under Section 7(b)(ii)-(v) hereof to the extent such payments do not constitute deferred compensation under Section 409A.
|
▪
|
Performance-based awards in accordance with Sections 15.3 and 15.4 of the Company’s 2015 Omnibus Incentive Compensation Plan (or any predecessor or successor plan) (the “Omnibus Plan”), but excluding Section 409A Awards (as defined in such Plan).
|
▪
|
Non-performance, service-based awards in accordance with Sections 15.3 and 15.4 of the Omnibus Plan, but excluding Section 409A Awards (as defined in such Plan).
|
▪
|
Awards of Options and SARs under the Omnibus Plan in accordance with Sections 15.3 and 15.4 of the Omnibus Plan.
|
▪
|
Payment of the severance amounts under Section 7(b)(ii)-(v) hereof to the extent such payments constitute deferred compensation under Section 409A.
|
▪
|
Performance-based Section 409A Awards in accordance with Sections 15.3 and 15.4 of the Omnibus Plan.
|
▪
|
Non-performance, service-based Section 409A awards in accordance with Sections 15.3 and 15.4 of the Omnibus Plan.
|
(a)
|
The Release of Claims means that you agree to give up forever any and all legal claims, or causes of actions, you may have, or think you have, against the Company, any of its subsidiaries, related or affiliated companies, including any predecessor or successor entities, and their respective directors, officers, and employees (collectively, the “
Company Parties
”). This Release of Claims includes all legal claims that arose at any time before or at the time you sign this Agreement; it also includes those legal claims of which you know and are aware, as well as any legal claims of which you may not know or be aware, including claims for breach of contract, claims arising out of any employment agreement you may have or under the Plan, claims of intentional or negligent infliction of emotional distress, defamation, breach of implied covenant of good faith and fair dealing, and any other claim arising from, or related to, your employment by the Company. In addition, the Company Parties agree to give up forever any and all legal claims, or causes of action, they may have or think they may have against you, including all legal
|
(b)
|
Several laws of the United States and of the Commonwealth of Virginia create claims for employees in various circumstances. These laws include the Age Discrimination in Employment Act of 1967, as amended by the Older Worker Benefit Protection Act, Title VII of the Civil Rights Act of 1964, the Rehabilitation Act of 1973, the Family and Medical Leave Act, the Employee Retirement Income Security Act, the Americans With Disabilities Act, the Genetic Information Non-discrimination Act, and the Virginia Human Rights Act. Several of these laws also provide for the award of attorneys’ fees to a successful plaintiff. You agree that this Release of Claims specifically includes any possible claims under any of these laws or similar state and federal laws, including any claims for attorneys’ fees.
|
(c)
|
By referring to specific laws we do not intend to limit the Release of Claims to just those laws. All legal claims for money damages, or any other relief that relate to or are in any way connected with your employment with the Company or any of its subsidiaries, related or affiliated companies, are included within this Release of Claims, even if they are not specifically referred to in this Agreement. The only legal claims that are not covered by this Release of Claims are the Excluded Matters.
|
(d)
|
Except for the Excluded Matters, we agree that neither party will say later that some particular legal claim or claims are not covered by this Release of Claims because we or you were unaware of the claim or claims, because such claims were overlooked, or because you or we made an error.
|
(e)
|
We specifically confirm that, as far as you or the Company know, no one has made any legal claim in any federal, state or local court or government agency relating to your employment, or the ending of your employment, with the Company.
|
(f)
|
This Agreement will not prevent you from filing any future administrative charges or complaints with the Securities and Exchange Commission (SEC), the United States Equal Employment Opportunity Commission (EEOC) or any state or federal government agency about a potential violation of federal or state law or regulation. This does not mean that you may collect any monetary damages or receive any other remedies from charges filed with, or actions by, a state or federal agency; such an award of damages or remedies would be precluded by the release set forth above, except in the case of any legal claims or causes of action arising out of any of the Excluded Matters; provided, however, the prohibitions on recovery of an award of damages or remedies in this Section 4(f) shall not apply to any recovery authorized under Section 21F of the Securities Exchange Act of 1934. This provision is meant to include claims that are solely or in part on your behalf, or on behalf of the Company, or claims which you or the Company have or have not authorized.
|
(a)
|
You agree that in consideration for the payments under paragraph 2 above, for a period of six (6) months after the Date of Termination (the “
Restricted Period
”), you will not, without the written consent of the Company, obtain or seek a position with a Competitor (as defined below) in which you will use or are likely to use any confidential
|
(b)
|
You understand and agree that the relationship between the Company and each of its employees constitutes a valuable asset of the Company and may not be converted to your own use. Accordingly, you hereby agree that during the Restricted Period, you shall not, directly or indirectly, on your own behalf or on behalf of another person, solicit or induce any employee of the Company to terminate his or her employment relationship with the Company or any affiliate of the Company or to enter into employment with another person or entity. The foregoing shall not apply to employees who respond to solicitations of employment directed to the general public or who seek employment at their own initiative.
|
(c)
|
You agree that you will not make any statements, oral or written, or cause or allow to be published in your name, or under any other name, any statements, interviews, articles, books, web logs, editorials or commentary (oral or written) that are critical or disparaging of the Company, or any of their operations, or any of their officers, employees or directors. Likewise, the Company agrees that it will not make, and will use reasonable efforts to ensure that directors and officers of the Company do not make, any statements, oral or written, or cause to be published in the Company’s name, any statements,
|
(d)
|
You agree that unless duly authorized in writing by the Company, you will not at any time divulge or use in connection with any business activity any trade secrets or confidential information first acquired by you during and by virtue of your employment with the Company. Notwithstanding any provisions of this Agreement or Company policy regarding the disclosure of trade secrets or confidential information, pursuant to section 7 of the Defend Trade Secrets Act of 2016 (“DTSA”), you cannot be held criminally or civilly liable under any federal or state trade secret law for disclosure of a trade secret if that disclosure is made (i) in confidence to a federal, state or local government official, either directly or indirectly, or to any attorney, and for the sole purpose of reporting or investigating a suspected violation of law, or (ii) in a complaint or other document filed in a lawsuit or similar proceeding, provided that filing is made under seal.
|
(e)
|
You acknowledge that a breach of this paragraph 5 would cause irreparable injury and damage to the Company which could not be reasonably or adequately compensated by money damages, and the Company acknowledges that a breach of paragraph 5 would cause irreparable injury and damage to you, which could not be reasonably or adequately compensated by money damages. Accordingly, each of you, the Company acknowledges that the remedies of injunction and specific performance shall be available in the event of such a breach, and the non-breaching party shall be entitled to money damages, costs and attorneys’ fees, and other legal or equitable remedies, including an injunction pending trial, without the posting of bond or other security. Any period of restriction set forth in this paragraph 5 shall be extended for a period of time equal to the duration of any breach or violation thereof.
|
(f)
|
In the event of your breach of this paragraph 5, in addition to the injunctive relief described above, the Company’s remedy shall include the forfeiture and return to the Company of any payment made to you or on your behalf under paragraph 2 above.
|
(g)
|
In the event that any provision of this paragraph 5 is held to be in any respect an unreasonable restriction, then the court so holding may modify the terms thereof, including the period of time during which it operates or the geographic area to which it applies, or effect any other change to the extent necessary to render this paragraph 5 enforceable, it being acknowledged by the parties that the representations and covenants set forth herein are of the essence of this Agreement.
|
(a)
|
“
Annual Base Salary
” means a Participant’s regular rate of annual base salary as in effect immediately preceding such Participant’s Qualifying Termination.
|
(b)
|
“Cause
” means a termination of a Participant’s employment following the occurrence of any of the following events, each of which shall constitute a “Cause” for such termination:
|
(i)
|
embezzlement, fraud, misappropriation of funds, breach of fiduciary duty or other act of material dishonesty committed by a Participant or at his or her direction;
|
(ii)
|
failure by a Participant to perform adequately the duties of his or her position, as a result of neglect or refusal, that he or she does not remedy within thirty (30) days after receipt of written notice from the Company;
|
(iii)
|
violation of the Company’s employment policies by a Participant;
|
(iv)
|
conviction of, or plea of guilty or
nolo contendere
by a Participant to a felony or any crime involving moral turpitude; or
|
(v)
|
found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any Federal or State securities law
.
|
(c)
|
“
Qualifying Termination
” means an involuntary termination of a Participant’s employment by the Company (other than for Cause). Any determination as to whether a termination is a Qualifying Termination shall be made in the reasonable, good faith discretion of the Committee. In no event shall a Participant’s voluntary termination or a termination due to a Participant’s
|
(d)
|
“
Severance Multiple
” means (i) with respect to the President and Chief Executive Officer of the Company, three (3); and (ii) for other Participants the “Severance Multiplier” shall be either two (2) or one (1) as assigned to the Participant by the Board or the Committee.
|
(a)
|
General
. It is intended that payments and benefits made or provided under this Plan shall not result in penalty taxes or accelerated taxation pursuant to Section 409A of the Internal Revenue Code of 1986, as amended (the “
Code
”), and the Plan shall be interpreted and administered in accordance with that intent. If any provision of the Plan would otherwise conflict with or frustrate this intent, that provision will be interpreted and deemed amended so as to avoid the conflict. Any payments that qualify for the “short-term deferral” exception, the separation pay exception or another exception under Section 409A of the Code shall be paid under the applicable exception. For purposes of the limitations on nonqualified deferred compensation under Section 409A of the Code, each payment of compensation under this Plan shall be treated as a separate payment of compensation for purposes of applying the exclusion under Section 409A of the Code for short-term deferral amounts, the separation pay exception or any other exception or exclusion under Section 409A of the Code. In no event may a Participant, directly or indirectly, designate the calendar year of any payment under this Plan. Despite any contrary provision of this Plan, any references to termination of employment or date of termination shall mean and refer to the date of a Participant’s “separation from service,” as that term is defined in Section 409A of the Code and Treasury regulation Section 1.409A-1(h).
|
(b)
|
Delay of Payment
. Notwithstanding any other provision of this Plan to the contrary, if a Participant is considered a “specified employee” for purposes of Section 409A of the Code (as determined in accordance with the methodology established by the Company as in effect on the termination date), any payment that constitutes nonqualified deferred compensation within the meaning of Section 409A of the Code that is otherwise due to a Participant under this Plan during the six (6)-month period immediately
|
(c)
|
Reimbursement and In-Kind Benefits
. Notwithstanding anything to the contrary in this Plan, all reimbursements and in-kind benefits provided under this Plan that are subject to Section 409A of the Code shall be made in accordance with the requirements of Section 409A of the Code, including, where applicable, the requirement that (i) any reimbursement is for expenses incurred during the Participant’s lifetime (or, if longer, through the twentieth (20
th
) anniversary of the Effective Date) or during a shorter period of time specified in this Plan); (ii) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year; (iii) the reimbursement of an eligible expense will be made no later than the last day of the calendar year following the year in which the expense is incurred; and (iv) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.
|
(a)
|
The Release of Claims means that you agree to give up forever any and all legal claims, or causes of actions, you may have, or think you have, against the Company, any of its subsidiaries, related or affiliated companies, including any predecessor or successor entities, and their respective directors, officers, and employees (collectively, the “
Company Parties
”). This Release of Claims includes all legal claims that arose at any time before or at the time you sign this Agreement; it also includes those legal claims of which you know and are aware, as well as any legal claims of which you may not know or be aware, including claims for breach of contract, claims arising out of any employment agreement you may have or under the Plan, claims of intentional or negligent infliction of emotional distress, defamation, breach of implied covenant of good faith and fair dealing, and any other claim arising from, or related to, your employment by the Company. In addition, the Company Parties agree to give up forever any and all legal claims, or causes of action, they may have or think they may have against you, including all legal claims that arose at any time before or at the time you sign this Agreement, whether known to the Company Parties or not.
|
(b)
|
Several laws of the United States and of the Commonwealth of Virginia create claims for employees in various circumstances. These laws include the Age Discrimination in Employment Act of 1967, as amended by the Older Worker Benefit Protection Act, Title VII of the Civil Rights Act of 1964, the Rehabilitation Act of 1973, the Family and Medical Leave Act, the Employee Retirement Income Security Act, the Americans With Disabilities Act, the Genetic Information Non-discrimination Act, and the Virginia Human Rights Act. Several of these laws also provide for the award of attorneys’ fees to a successful plaintiff. You agree that this Release of Claims specifically includes any possible claims under any of these laws or similar state and federal laws, including any claims for attorneys’ fees.
|
(c)
|
By referring to specific laws we do not intend to limit the Release of Claims to just those laws. All legal claims for money damages, or any other relief that relate to or are in any way connected with your
|
(d)
|
Except for the Excluded Matters, we agree that neither party will say later that some particular legal claim or claims are not covered by this Release of Claims because we or you were unaware of the claim or claims, because such claims were overlooked, or because you or we made an error.
|
(e)
|
We specifically confirm that, as far as you or the Company know, no one has made any legal claim in any federal, state or local court or government agency relating to your employment, or the ending of your employment, with the Company.
|
(f)
|
This Agreement will not prevent you from filing any future administrative charges or complaints with the Securities and Exchange Commission (SEC), the United States Equal Employment Opportunity Commission (EEOC) or any state or federal government agency about a potential violation of federal or state law or regulation. This does not mean that you may collect any monetary damages or receive any other remedies from charges filed with, or actions by, a state or federal agency; such an award of damages or remedies would be precluded by the release set forth above, except in the case of any legal claims or causes of action arising out of any of the Excluded Matters; provided, however, that the prohibitions on recovery of an award of damages or remedies in this section 4(f) shall not apply to any recovery authorized under Section 21F of the Securities Exchange Act of 1934. This provision is meant to include claims that are solely or in part on your behalf, or on behalf of the Company, or claims which you or the Company have or have not authorized.
|
(a)
|
You agree that in consideration for the payments under paragraph 2 above, for a period of six (6) months after the Date of Termination (the “
Restricted Period
”), you will not, without the written consent of the Company, obtain or seek a position with a Competitor (as defined below) in which you will use or are likely to use any confidential information or trade secrets of the Company including, but not limited to, a position in which you would have duties for such Competitor within the United States that involve Competitive
|
(b)
|
You understand and agree that the relationship between the Company and each of its employees constitutes a valuable asset of the Company and may not be converted to your own use. Accordingly, you hereby agree that during the Restricted Period, you shall not, directly or indirectly, on your own behalf or on behalf of another person, solicit or induce any employee of the Company to terminate his or her employment relationship with the Company or any affiliate of the Company or to enter into employment with another person or entity. The foregoing shall not apply to employees who respond to solicitations of employment directed to the general public or who seek employment at their own initiative.
|
(c)
|
For purposes of this paragraph 5, “
Competitive Services
” means the provision of goods or services that are competitive with any goods or services offered by the Company as of the date of this Agreement, including, but not limited to newspapers, non-daily publications, digital, Internet, and other news and information services, and “
Competitor
” means any individual or any entity or enterprise engaged, wholly or in part, in Competitive Services. The parties acknowledge that the Company may from time to time during the term of this Agreement change or increase the line of goods or services it provides, and you agree to amend this Agreement from time to time to include such different or additional goods and services to the definition of “Competitive Services” for purposes of this paragraph 5.
|
(d)
|
You agree that due to your position of trust and confidence the restrictions contained in this paragraph 5 are reasonable, and the benefits conferred on you in this Agreement are adequate consideration, and since the nature of the Company’s business is national in scope, the geographic restriction herein is reasonable.
|
(e)
|
You agree that you will not make any statements, oral or written, or cause or allow to be published in your name, or under any other name, any statements, interviews, articles, books, web logs, editorials or commentary (oral or written) that are critical or disparaging of the Company, or any of their operations, or any of their officers, employees or directors. Likewise, the Company agrees that it will not make, and will use reasonable efforts to ensure that directors and officers of the Company do not make, any statements, oral or written, or cause to be published in the Company’s name, any statements, interviews, articles, editorials or commentary (oral or written) that are
|
(f)
|
You agree that unless duly authorized in writing by the Company, you will not at any time divulge or use in connection with any business activity any trade secrets or confidential information first acquired by you during and by virtue of your employment with the Company. Notwithstanding any provisions of this Agreement or Company policy regarding the disclosure of trade secrets or confidential information, pursuant to section 7 of the Defend Trade Secrets Act of 2016 (“DTSA”), you cannot be held criminally or civilly liable under any federal or state trade secret law for disclosure of a trade secret if that disclosure is made (i) in confidence to a federal, state or local government official, either directly or indirectly, or to any attorney, and for the sole purpose of reporting or investigating a suspected violation of law, or (ii) in a complaint or other document filed in a lawsuit or similar proceeding, provided that filing is made under seal.
|
(g)
|
You acknowledge that a breach of this paragraph 5 would cause irreparable injury and damage to the Company which could not be reasonably or adequately compensated by money damages, and the Company acknowledges that a breach of paragraph 5(e) would cause irreparable injury and damage to you, which could not be reasonably or adequately compensated by money damages. Accordingly, each of you, the Company acknowledges that the remedies of injunction and specific performance shall be available in the event of such a breach, and the non-breaching party shall be entitled to money damages, costs and attorneys’ fees, and other legal or equitable remedies, including an injunction pending trial, without the posting of bond or other security. Any period of restriction set forth in this paragraph 5 shall be extended for a period of time equal to the duration of any breach or violation thereof.
|
(h)
|
In the event of your breach of this paragraph 5, in addition to the injunctive relief described above, the Company’s remedy shall include the forfeiture or return to the Company of any payment made or due to you or on your behalf under paragraph 2 above.
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(i)
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In the event that any provision of this paragraph 5 is held to be in any respect an unreasonable restriction, then the court so holding may modify the terms thereof, including the period of time during which it operates or the geographic area to which it applies, or effect any other change to the extent necessary to render this paragraph 5 enforceable, it being acknowledged by the parties that the representations and covenants set forth herein are of the essence of this Agreement.
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I,
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Robert J. Dickey, certify that:
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1.
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I have reviewed this quarterly report on Form 10-Q of Gannett Co., Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: August 3, 2017
|
|
/s/ Robert J. Dickey
|
Robert J. Dickey
|
President and Chief Executive Officer
|
(principal executive officer)
|
I,
|
Alison K. Engel, certify that:
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Gannett Co., Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August 3, 2017
|
|
/s/ Alison K. Engel
|
Alison K. Engel
|
Senior Vice President, Chief Financial Officer and Treasurer
|
(principal financial officer)
|
(1)
|
the Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Gannett.
|
/s/ Robert J. Dickey
|
Robert J. Dickey
|
President and Chief Executive Officer
|
(principal executive officer)
|
August 3, 2017
|
(1)
|
the Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Gannett.
|
/s/ Alison K. Engel
|
Alison K. Engel
|
Senior Vice President, Chief Financial Officer and Treasurer
|
(principal financial officer)
|
August 3, 2017
|