Launched Digital Subscription Model at USA TODAY

Achieved Record Digital-Only Subscriber Growth of 41% to Approximately 1.4 million Paid Subscribers

Digital Revenues Rose 33% and Digital Marketing Solutions Revenue Rose 21.5% Over Prior Year Same Store

Gannett Co., Inc. ("Gannett", "we", "us", "our", or the "Company") (NYSE: GCI) today reported its financial results for the second quarter ended June 30, 2021.

"The solid results of the second quarter of 2021 underscore the strength of our strategy and the execution of our team. Digital-only subscriber growth continued to set new records in the second quarter of 2021, ending the quarter at approximately 1.4 million, up 41% compared to a year ago. Our Digital Marketing Solutions segment posted significant year-over-year growth and continued to grow platform client count sequentially each quarter,” said Michael Reed, Gannett Chairman and Chief Executive Officer. "The Company once again grew Adjusted EBITDA year-over-year, now for the third quarter in a row. With digital revenues making up approximately one-third of our total revenue and growing, we believe we are well positioned for the second half of the year and beyond."

Second Quarter 2021 Financial Highlights:

  • Total revenues of $804.3 million rose 4.9% compared to the prior year quarter
    • Same store revenues (as defined and reconciled on Table No. 5 below) increased 6.8% compared to the second quarter of 2020
  • Total digital revenues were $259.3 million or 32.2% of total revenues
  • Net income attributable to Gannett of $15.1 million
  • Adjusted net income attributable to Gannett of $30.1 million
  • Adjusted EBITDA totaled $115.8 million, an increase of $37.8 million or 48.4% compared to the second quarter of 2020 and represented a 14.4% margin
  • Net cash flow provided by operating activities of $31.3 million
  • Free cash flow of $23.1 million

Additional Business Highlights:

  • Signed strategic sports betting agreement with Tipico US Technology, Inc. ("Tipico")
    • Tipico to become the exclusive sports betting and iGaming provider for Gannett, with integration of odds, props, free to play games and betting trends across the USA TODAY NETWORK
    • The five-year agreement includes $90.0 million in media spend by Tipico, together with performance incentives payable to Gannett for customer referrals. Subject to certain conditions being met over the five year term of the agreement, Gannett will have the right to acquire up to 4,990 common shares in Tipico's U.S. business, representing a minority share
    • Gannett will provide Tipico exclusive access to premium marketing assets at a prenegotiated value based upon the expected aggregate sum of the cash consideration, performance incentives, and right to acquire common shares
  • Launched digital subscription model at USA TODAY with subscriber-only content
  • Digital-only circulation subscribers totaled approximately 1.4 million at the end of the second quarter of 2021, up 41% compared to the same period in the prior year
    • Digital-only circulation revenues of $24.0 million grew 39.7% in the second quarter of 2021 compared to the same period in the prior year
  • 174 million average monthly unique visitors per ComScore in the second quarter of 2021 across USA TODAY NETWORK and U.K. digital properties
  • Digital Marketing Solutions segment revenues were $110.0 million, and on a same store basis increased 21.5% in the second quarter of 2021 compared to the same period in the prior year
    • Total platform customers increased sequentially to 15,000 in the second quarter of 2021, up 10.6% quarter-over-quarter
  • During the second quarter of 2021, the Company repaid approximately $45.8 million in principal under its 5-Year Term Loan using the proceeds from real estate and other asset sales totaling $11.2 million and excess cash, bringing the 5-Year Term Loan principal under $1.0 billion
    • Total debt principal outstanding as of June 30, 2021 was $1.491 billion, comprised of the (i) $990.5 million of 5-Year Term Loan, (ii) $497.1 million of 2027 Convertible Notes, and (iii) $3.3 million of remaining convertible notes from our acquisition of Gannett Co., Inc. (which was renamed Gannett Media Corp. and is referred to as "Legacy Gannett") in the fourth quarter of 2019
  • As of June 30, 2021, the Company had cash and cash equivalents of $158.6 million
    • Targeting First Lien Net Leverage of 1.0x by the end of 2022
    • First Lien Net Leverage of 1.8x as of June 30, 2021
    • First Lien Net Leverage ratio is calculated by subtracting cash on the balance sheet from 5-Year Term Loan and dividing it by Q2 2021 LTM Adjusted EBITDA. 2027 Convertible Notes are second lien as of the completion of the 5-Year Term Loan refinancing in February 2021

Financial Highlights

 

in thousands

Second Quarter 2021

Revenues

$

804,275

Net income attributable to Gannett

 

15,115

Adjusted EBITDA(1) (non-GAAP)

 

115,769

Adjusted Net income attributable to Gannett(1) (non-GAAP)

 

30,058

Net cash flow provided by operating activities

 

31,271

Free cash flow(1) (non-GAAP)

 

23,057

(1) Refer to "Use of Non-GAAP Information" below for the Company’s definition of Adjusted EBITDA, Adjusted Net income attributable to Gannett, and Free cash flow, as well as the reconciliation of such measures to the most comparable GAAP measure.

Earnings Conference Call

Management will host a conference call on Friday, August 6, 2021 at 8:30 A.M. Eastern Time. A copy of the earnings release will be posted to the Investor Relations section of Gannett’s website, investors.gannett.com. The conference call may be accessed by dialing 1-877-451-6152 (from within the U.S.) or 1-201-389-0879 (from outside of the U.S.) ten minutes prior to the scheduled start of the call; please reference “Gannett Second Quarter Earnings Call” or access code “13719790”. A simultaneous webcast of the conference call will be available to the public on a listen-only basis at investors.gannett.com. Please allow extra time prior to the call to visit the website and download any necessary software required to listen to the internet broadcast. A telephonic replay of the conference call will also be available approximately two hours following the call’s completion through 11:59 P.M. Eastern Time on Friday, August 20, 2021 by dialing 1-844-512-2921 (from within the U.S.) or 1-412-317-6671 (from outside of the U.S.); please reference access code “13719790”.

About Gannett

Gannett Co., Inc. (NYSE: GCI) is a subscription-led and digitally focused media and marketing solutions company committed to empowering communities to thrive. With an unmatched reach at the national and local level, Gannett touches the lives of millions with our Pulitzer Prize-winning content, consumer experiences and benefits, and advertiser products and services. Our current portfolio of media assets includes USA TODAY, local media organizations in 46 states in the U.S., and Newsquest, a wholly owned subsidiary operating in the United Kingdom with more than 120 local news media brands. Gannett also owns the digital marketing services companies ReachLocal, Inc., UpCurve, Inc., and WordStream, Inc., which are marketed under the LOCALiQ brand, and runs the largest media-owned events business in the U.S., USA TODAY NETWORK Ventures. To connect with us, visit www.gannett.com.

Same Store Revenues

Same store revenues are based on GAAP revenues for Gannett for the current period, excluding (i) exited operations, (ii) currency impacts, and (iii) deferred revenue impacts related to the acquisition of Legacy Gannett.

Cautionary Statement Regarding Forward-Looking Statements

Certain items in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our ability to grow Adjusted EBITDA, our ability to achieve our operating priorities, our digital revenue performance and growth in our Digital Marketing Solutions segment, the potential sales of assets, including the anticipated use of any proceeds from such sales, our expectations, in terms of both amount and timing, with respect to debt repayment, real estate sales and debt refinancing, growth of and demand for our digital-only subscriptions and digital marketing and advertising services, our strategic alliance and sports betting agreement, our strategy, and future revenue trends and our ability to influence trends. Words such as "expect(s)", "plan(s)", "believes(s)", "will", and similar expressions are intended to identify such forward-looking statements. These statements are based on management’s current expectations and beliefs and are subject to a number of risks and uncertainties. These and other risks and uncertainties could cause actual results to differ materially from those described in the forward-looking statements, many of which are beyond our control. The Company can give no assurance its expectations will be attained. Accordingly, you should not place undue reliance on any forward-looking statements contained in this press release. For a discussion of some of the risks and important factors that could cause actual results to differ from such forward-looking statements, see the risks and other factors detailed from time to time in the Company’s 2020 Annual Report on Form 10-K, and other filings with the Securities and Exchange Commission. Furthermore, new risks and uncertainties emerge from time to time, and it is not possible for the Company to predict or assess the impact of every factor that may cause its actual results to differ from those contained in any forward-looking statements. Such forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with regard thereto or change in events, conditions or circumstances on which any statement is based.

GANNETT CO., INC. CONDENSED CONSOLIDATED BALANCE SHEETS

 

Table No. 1

 

 

 

In thousands, except share data

June 30, 2021

 

December 31, 2020

Assets

(Unaudited)

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

158,563

 

 

$

170,725

 

Accounts receivable, net of allowance for doubtful accounts of $17,955 and $20,843, as of June 30, 2021 and December 31, 2020, respectively

291,452

 

 

314,305

 

Inventories

34,535

 

 

35,075

 

Prepaid expenses and other current assets

113,275

 

 

116,581

 

Total current assets

597,825

 

 

636,686

 

Property, plant, and equipment, net

522,347

 

 

590,272

 

Operating lease assets

278,389

 

 

289,504

 

Goodwill

534,218

 

 

534,088

 

Intangible assets, net

770,811

 

 

824,650

 

Deferred tax assets

58,571

 

 

90,240

 

Other assets

211,627

 

 

143,474

 

Total assets

$

2,973,788

 

 

$

3,108,914

 

 

 

 

 

Liabilities and equity

 

 

 

Current liabilities:

 

 

 

Accounts payable and accrued liabilities

$

351,919

 

 

$

378,246

 

Deferred revenue

184,619

 

 

186,007

 

Current portion of long-term debt

106,644

 

 

128,445

 

Other current liabilities

49,939

 

 

48,602

 

Total current liabilities

693,121

 

 

741,300

 

Long-term debt

823,009

 

 

890,323

 

Convertible debt

396,964

 

 

581,405

 

Deferred tax liabilities

22,567

 

 

6,855

 

Pension and other postretirement benefit obligations

90,019

 

 

99,765

 

Long-term operating lease liabilities

262,390

 

 

274,460

 

Other long-term liabilities

157,708

 

 

151,847

 

Total noncurrent liabilities

1,752,657

 

 

2,004,655

 

Total liabilities

2,445,778

 

 

2,745,955

 

Redeemable noncontrolling interests

(2,067)

 

 

(1,150)

 

Commitments and contingent liabilities

 

 

 

 

 

 

 

Equity

 

 

 

Preferred stock, $0.01 par value, 300,000 shares authorized, of which 150,000 shares are designated as Series A Junior Participating Preferred Stock, none of which were issued and outstanding at June 30, 2021 and December 31, 2020

 

 

 

Common stock, $0.01 par value per share, 2,000,000,000 shares authorized; 144,638,938 shares issued and 142,624,274 shares outstanding at June 30, 2021; 139,494,741 shares issued and 138,102,993 shares outstanding at December 31, 2020

1,446

 

 

1,395

 

Treasury stock, at cost, 2,014,664 shares and 1,391,748 shares at June 30, 2021 and December 31, 2020, respectively

(6,935)

 

 

(4,903)

 

Additional paid-in capital

1,395,191

 

 

1,103,881

 

Accumulated deficit

(913,638)

 

 

(786,437)

 

Accumulated other comprehensive income

54,013

 

 

50,173

 

Total equity

530,077

 

 

364,109

 

Total liabilities and equity

$

2,973,788

 

 

$

3,108,914

 

GANNETT CO., INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

 

Table No. 2

Three months ended June 30,

In thousands, except per share amounts

2021

 

2020

Advertising and marketing services

$

420,110

 

 

$

356,918

 

Circulation

310,259

 

 

342,646

 

Other

73,906

 

 

67,436

 

Total operating revenues

804,275

 

 

767,000

 

Operating costs

473,172

 

 

476,735

 

Selling, general and administrative expenses

222,904

 

 

226,484

 

Depreciation and amortization

48,242

 

 

66,327

 

Integration and reorganization costs

8,444

 

 

32,306

 

Asset impairments

 

 

6,859

 

Goodwill and intangible impairments

 

 

393,446

 

Net loss on sale or disposal of assets

5,294

 

 

88

 

Other operating expenses

774

 

 

2,379

 

Total operating expenses

758,830

 

 

1,204,624

 

Operating income (loss)

45,445

 

 

(437,624)

 

Interest expense

35,264

 

 

57,928

 

Loss on early extinguishment of debt

2,834

 

 

369

 

Non-operating pension income

(23,906)

 

 

(17,553)

 

Other income, net

(1,148)

 

 

(6,261)

 

Non-operating expense

13,044

 

 

34,483

 

Income (loss) before income taxes

32,401

 

 

(472,107)

 

Provision (benefit) for income taxes

17,692

 

 

(34,276)

 

Net income (loss)

$

14,709

 

 

$

(437,831)

 

Net loss attributable to redeemable noncontrolling interests

(406)

 

 

(938)

 

Net income (loss) attributable to Gannett

$

15,115

 

 

$

(436,893)

 

 

 

 

 

Interest adjustment to Net income (loss) attributable to Gannett related to assumed conversions of the 2027 Notes, net of taxes

$

7,470

 

 

$

 

Net income (loss) attributable to Gannett for diluted earnings per share

$

22,585

 

 

$

(436,893)

 

 

 

 

 

Income (loss) per share attributable to Gannett - basic

$

0.11

 

 

$

(3.32)

 

Income (loss) per share attributable to Gannett - diluted

$

0.10

 

 

$

(3.32)

 

GANNETT CO., INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

 

Table No. 3

Six months ended June 30,

In thousands

2021

 

2020

Operating activities:

 

 

 

Net loss

$

(127,992)

 

 

$

(518,437)

 

Adjustments to reconcile net loss to operating cash flows:

 

 

 

Depreciation and amortization

106,345

 

 

144,352

 

Share-based compensation expense

9,202

 

 

18,968

 

Non-cash interest expense

11,531

 

 

11,902

 

Net loss on sale or disposal of assets

10,039

 

 

745

 

Loss on Convertible notes derivative

126,600

 

 

 

Loss on early extinguishment of debt

22,235

 

 

1,174

 

Goodwill and intangible impairments

 

 

393,446

 

Asset impairments

833

 

 

6,859

 

Pension and other postretirement benefit obligations

(78,038)

 

 

(49,064)

 

Change in other assets and liabilities, net

11,832

 

 

14,695

 

Net cash provided by operating activities

92,587

 

 

24,640

 

Investing activities:

 

 

 

Purchase of property, plant, and equipment

(15,821)

 

 

(22,157)

 

Proceeds from sale of real estate and other assets

23,341

 

 

17,792

 

Change in other investing activities

(335)

 

 

1,339

 

Net cash provided by (used for) investing activities

7,185

 

 

(3,026)

 

Financing activities:

 

 

 

Payments of debt issuance costs

(33,921)

 

 

 

Borrowings under term loans

1,045,000

 

 

 

Repayments under term loans

(1,129,605)

 

 

(18,985)

 

Payments for employee taxes withheld from stock awards

(2,030)

 

 

(1,942)

 

Changes in other financing activities

(423)

 

 

596

 

Net cash used for financing activities

(120,979)

 

 

(20,331)

 

Effect of currency exchange rate change on cash

625

 

 

(780)

 

(Decrease) increase in cash, cash equivalents and restricted cash

(20,582)

 

 

503

 

Balance of cash, cash equivalents and restricted cash at beginning of period

206,726

 

 

188,664

 

Balance of cash, cash equivalents and restricted cash at end of period

$

186,144

 

 

$

189,167

 

GANNETT CO., INC. SEGMENT INFORMATION (Unaudited)

 

Table No. 4

Three months ended June 30,

In thousands

2021

 

2020

Operating revenues:

 

 

 

Publishing

$

724,545

 

 

$

695,893

 

Digital Marketing Solutions

110,037

 

 

94,563

 

Corporate and Other

1,705

 

 

2,398

 

Intersegment eliminations

(32,012)

 

 

(25,854)

 

Total

$

804,275

 

 

$

767,000

 

 

 

 

 

Adjusted EBITDA:

 

 

 

Publishing

$

114,189

 

 

$

91,991

 

Digital Marketing Solutions

12,529

 

 

2,784

 

Corporate and Other

(10,949)

 

 

(16,757)

 

Total

$

115,769

 

 

$

78,018

 

GANNETT CO., INC. SAME STORE REVENUES (Unaudited)

 

Table No. 5

Three months ended June 30,

In thousands

2021

 

2020

 

% Change

Total revenues

$

804,275

 

 

$

767,000

 

 

4.9

%

Currency impact

 

(7,321

)

 

 

 

 

***

Exited operations

 

7

 

 

 

(21,464

)

 

***

Deferred revenue adjustment

 

 

 

 

980

 

 

(100.0

)%

Same store total revenues

$

796,961

 

 

$

746,516

 

 

6.8

%

 

 

 

 

 

 

Advertising and marketing services revenues

$

420,110

 

 

$

356,918

 

 

17.7

%

Currency impact

 

(4,718

)

 

 

 

 

***

Exited operations

 

7

 

 

 

(11,749

)

 

***

Deferred revenue adjustment

 

 

 

 

396

 

 

(100.0

)%

Same store advertising and marketing services revenues

$

415,399

 

 

$

345,565

 

 

20.2

%

 

 

 

 

 

 

Circulation revenues

$

310,259

 

 

$

342,646

 

 

(9.5

)%

Currency impact

 

(2,046

)

 

 

 

 

***

Exited operations

 

 

 

 

(3,876

)

 

(100.0

)%

Deferred revenue adjustment

 

 

 

 

584

 

 

(100.0

)%

Same store circulation revenues

$

308,213

 

 

$

339,354

 

 

(9.2

)%

 

 

 

 

 

 

Other revenues

$

73,906

 

 

$

67,436

 

 

9.6

%

Currency impact

 

(557

)

 

 

 

 

***

Exited operations

 

 

 

 

(5,839

)

 

(100.0

)%

Same store other revenues

$

73,349

 

 

$

61,597

 

 

19.1

%

*** Indicates a percentage change greater than 100.

USE OF NON-GAAP INFORMATION

The Company uses non-GAAP financial performance and liquidity measures to supplement the financial information presented on a U.S. GAAP basis. These non-GAAP financial measures, which may not be comparable to similarly titled measures reported by other companies, should not be considered in isolation from or as a substitute for the related U.S. GAAP measures and should be read together with financial information presented on a U.S. GAAP basis.

The Company defines its non-GAAP measures as follows:

  • Adjusted EBITDA is a non-GAAP performance measure the Company believes offers a useful view of the overall operations 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 the early extinguishment of debt, (4) Non-operating pension income (expense), (5) Loss on Convertible notes derivative, (6) Other non-operating items, including equity income, (7) Depreciation and amortization, (8) Integration and reorganization costs, (9) Asset impairments, (10) Goodwill and intangible impairments, (11) Gains or losses on the sale or disposal of assets, (12) Share-based compensation, (13) Other operating expenses, including third-party debt expenses and acquisition costs, (14) Gains or losses on the sale of investments and (15) certain other non-recurring charges. The most directly comparable U.S. GAAP measure is Net income (loss) attributable to Gannett.
  • Adjusted EBITDA margin is a non-GAAP performance measure the Company believes offers a useful view of the overall operations of our business. Adjusted EBITDA margin is defined as Adjusted EBITDA divided by total Operating revenues.
  • Adjusted Net income (loss) attributable to Gannett is a non-GAAP performance measure the Company believes offers a useful view of the overall operations of our business and is useful to analysts and investors in evaluating the results of operations and operational trends. The Company defines Adjusted Net income (loss) attributable to Gannett before (1) Gains or losses on the early extinguishment of debt, (2) Loss on Convertible notes derivative, (3) Integration and reorganization costs, (4) Other operating expenses, including third-party debt expenses and acquisition costs, (5) Asset impairments, (6) Goodwill and intangibles impairments, (7) Gains or losses on the sale or disposal of assets, and (8) the tax impact of the above items.
  • Free cash flow is a non-GAAP liquidity measure that adjusts our reported U.S. 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 stockholders. The most directly comparable U.S. GAAP financial measure is Net cash from operating activities.

Management’s Use of Non-GAAP Measures

Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net income (loss) attributable to Gannett, and Free cash flow are not measurements of financial performance under U.S. GAAP and should not be considered in isolation or as an alternative to income from operations, net income (loss), margin, cash flow from operating activities, or any other measure of performance or liquidity derived in accordance with U.S. GAAP. We believe these non-GAAP financial measures as we have defined them are helpful in identifying trends in our day-to-day performance because these items excluded have little or no significance on our day-to-day operations. These measures provide an assessment of controllable expenses and affords management the ability to make decisions which are expected to facilitate meeting current financial goals as well as achieve optimal financial performance.

Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss) attributable to Gannett provide us with measures of financial performance, independent of items that are beyond the control of management in the short-term, such as depreciation and amortization, taxation, non-cash impairments, and interest expense associated with our capital structure. These metrics measure our financial performance based on operational factors that management can impact in the short-term, namely the cost structure or expenses of the organization. Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss) attributable to Gannett are metrics we use to review the financial performance of our business on a monthly basis.

We use Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss) attributable to Gannett as measures of our day-to-day operating performance, which is evidenced by the publishing and delivery of news and other media and excludes certain expenses that may not be indicative of our day-to-day business operating results.

Limitations of Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net income (loss) attributable to Gannett, and Free cash flow

Each of our non-GAAP measures have limitations as an analytical tool. They should not be viewed in isolation or as a substitute for U.S. GAAP measures of earnings or cash flows. Material limitations in making the adjustments to our earnings to calculate Adjusted EBITDA and using this non-GAAP financial measure as compared to U.S. GAAP net income (loss) include: the cash portion of interest / financing expense, income tax (benefit) provision, and charges related to asset impairments, which may significantly affect our financial results.

Management believes these items are important in evaluating our performance, results of operations, and financial position. We use non-GAAP financial measures to supplement our U.S. GAAP results in order to provide a more complete understanding of the factors and trends affecting our business.

Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net income (loss) attributable to Gannett, and Free cash flow are not alternatives to net income, income from operations, or cash flows provided by or used in operations as calculated and presented in accordance with U.S. GAAP. As such, they should not be considered or relied upon as a substitute or alternative for any such U.S. GAAP financial measure. We strongly urge you to review the reconciliations of Net income (loss) attributable to Gannett to Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted Net income (loss) attributable to Gannett, and Cash provided by operations to Free Cash Flow along with our condensed consolidated financial statements included elsewhere in this report. We also strongly urge you to not rely on any single financial measure to evaluate our business. In addition, because Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net income (loss) attributable to Gannett, and Free cash flow are not measures of financial performance under U.S. GAAP and are susceptible to varying calculations, the Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net income (loss) attributable to Gannett, and Free cash flow measures as presented in this report may differ from and may not be comparable to similarly titled measures used by other companies.

GANNETT CO., INC. NON-GAAP FINANCIAL INFORMATION ADJUSTED EBITDA (Unaudited)

 

Table No. 6

Three months ended June 30, 2021

In thousands

Publishing

 

Digital Marketing Solutions

 

Corporate and Other

 

Consolidated Total

Net income (loss) attributable to Gannett

$

96,431

 

 

$

4,904

 

 

$

(86,220

)

 

$

15,115

 

Provision for income taxes

 

 

 

 

 

 

 

17,692

 

 

 

17,692

 

Interest expense

 

 

 

 

 

 

 

35,264

 

 

 

35,264

 

Loss on early extinguishment of debt

 

 

 

 

 

 

 

2,834

 

 

 

2,834

 

Non-operating pension income

 

(23,906

)

 

 

 

 

 

 

 

 

(23,906

)

Other non-operating (income) expense, net

 

(1,829

)

 

 

98

 

 

 

583

 

 

 

(1,148

)

Depreciation and amortization

 

36,416

 

 

 

7,850

 

 

 

3,976

 

 

 

48,242

 

Integration and reorganization costs

 

(197

)

 

 

204

 

 

 

8,437

 

 

 

8,444

 

Other operating expenses

 

 

 

 

 

 

 

774

 

 

 

774

 

Net (gain) loss on sale or disposal of assets

 

5,890

 

 

 

(527

)

 

 

(69

)

 

 

5,294

 

Share-based compensation expense

 

 

 

 

 

 

 

5,779

 

 

 

5,779

 

Other items

 

1,384

 

 

 

 

 

 

1

 

 

 

1,385

 

Adjusted EBITDA (non-GAAP basis)

$

114,189

 

 

$

12,529

 

 

$

(10,949

)

 

$

115,769

 

Net income (loss) attributable to Gannett margin

 

13.3

%

 

 

4.5

%

 

 

NM

 

 

 

1.9

%

Adjusted EBITDA margin (non-GAAP basis)

 

15.8

%

 

 

11.4

%

 

 

NM

 

 

 

14.4

%

NM indicates not meaningful.

 

 

 

 

 

 

 

 

Three months ended June 30, 2020

In thousands

Publishing

 

Digital Marketing Solutions

 

Corporate and Other

 

Consolidated Total

Net loss attributable to Gannett

$

(328,207

)

 

$

(43,226

)

 

$

(65,460

)

 

$

(436,893

)

Benefit for income taxes

 

 

 

 

 

 

 

(34,276

)

 

 

(34,276

)

Interest expense

 

92

 

 

 

 

 

 

57,836

 

 

 

57,928

 

Loss on early extinguishment of debt

 

 

 

 

 

 

 

369

 

 

 

369

 

Non-operating pension income

 

(17,480

)

 

 

 

 

 

(73

)

 

 

(17,553

)

Other non-operating income, net

 

(3,066

)

 

 

(2,614

)

 

 

(581

)

 

 

(6,261

)

Depreciation and amortization

 

56,553

 

 

 

4,004

 

 

 

5,770

 

 

 

66,327

 

Integration and reorganization costs

 

20,619

 

 

 

2,962

 

 

 

8,725

 

 

 

32,306

 

Other operating expenses

 

 

 

 

 

 

 

2,379

 

 

 

2,379

 

Asset impairments

 

6,859

 

 

 

 

 

 

 

 

 

6,859

 

Goodwill and intangible impairments

 

352,947

 

 

 

40,499

 

 

 

 

 

 

393,446

 

Net (gain) loss on sale or disposal of assets

 

(449

)

 

 

516

 

 

 

21

 

 

 

88

 

Share-based compensation expense

 

 

 

 

 

 

 

7,391

 

 

 

7,391

 

Other items

 

4,123

 

 

 

643

 

 

 

1,142

 

 

 

5,908

 

Adjusted EBITDA (non-GAAP basis)

$

91,991

 

 

$

2,784

 

 

$

(16,757

)

 

$

78,018

 

Net loss attributable to Gannett margin

 

(47.2

)%

 

 

(45.7

)%

 

 

NM

 

 

 

(57.0

)%

Adjusted EBITDA margin (non-GAAP basis)

 

13.2

%

 

 

2.9

%

 

 

NM

 

 

 

10.2

%

NM indicates not meaningful.

GANNETT CO., INC. NON-GAAP FINANCIAL INFORMATION ADJUSTED NET INCOME (LOSS) ATTRIBUTABLE TO GANNETT (Unaudited)

 

Table No. 7

Three months ended June 30,

In thousands

2021

 

2020

Net income (loss) attributable to Gannett

$

15,115

 

 

$

(436,893

)

Loss on early extinguishment of debt

 

2,834

 

 

 

369

 

Integration and reorganization costs

 

8,444

 

 

 

32,306

 

Other operating expenses

 

774

 

 

 

2,379

 

Asset impairments

 

 

 

 

6,859

 

Goodwill and intangible impairments

 

 

 

 

393,446

 

Net loss on sale or disposal of assets

 

5,294

 

 

 

88

 

Subtotal

 

32,461

 

 

 

(1,446

)

Tax impact of above items

 

(2,403

)

 

 

(3,734

)

Adjusted Net income (loss) attributable to Gannett (non-GAAP basis)

$

30,058

 

 

$

(5,180

)

GANNETT CO., INC. NON-GAAP FINANCIAL INFORMATION FREE CASH FLOW (Unaudited)

 

Table No. 8

 

In thousands

Three months ended June 30, 2021

Net cash flow provided by operating activities (GAAP basis)

$

31,271

 

Capital expenditures

 

(8,214

)

Free cash flow (non-GAAP basis)(a)

$

23,057

 

(a) Free cash flow for the second quarter of 2021 was negatively impacted by $17.8 million of integration and reorganization costs and $1.2 million of third-party fees related to the 5-Year Term Loan.

For investor inquiries, contact: Trisha Gosser Investor Relations 212-479-3160 investors@gannett.com

For media inquiries, contact: Lark-Marie Anton SVP, Communications 646-906-4087 lark@gannett.com

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