DES MOINES, Iowa, Oct. 28, 2021 /PRNewswire/ -- Meredith
Corporation (NYSE: MDP) today reported fiscal 2022
first quarter results as summarized below. All financial results
refer to fiscal 2022 first quarter and the comparable prior-year
period unless otherwise stated.
Three months ended
September 30, 2021
|
Results
|
YoY
Change
|
(In
millions)
|
|
|
Total
revenues
|
$
|
708.6
|
|
2
|
%
|
|
|
|
Net
earnings
|
24.8
|
|
(41)
|
%
|
Net special items
1,2
|
16.6
|
|
F
|
|
Net earnings before
special items 2
|
41.4
|
|
(17)
|
%
|
Adjusted EBITDA
2
|
124.7
|
|
(13)
|
%
|
Net cash provided by
operating activities
|
42.3
|
|
(46)
|
%
|
Free cash flow
2
|
34.5
|
|
(50)
|
%
|
F represents
favorable improvements greater than 100%.
|
1 Special items for the three months ended
September 30, 2021, primarily consisted of transaction
costs.
|
2 See Tables 1-4 for supplemental disclosures regarding
non-GAAP financial measures.
|
|
|
"We delivered total Company revenue growth, as continued record
digital performance and stronger non-political advertising and
magazine consumer revenues overcame historically high political
advertising revenues in the prior year," said Meredith Chairman and
Chief Executive Officer Tom Harty.
"Our digital performance reflects strength across the board,
including advertising, licensing, and digital consumer driven
sources such as performance marketing and content commerce."
Reflecting the growth and increasing importance of its digital
business, Meredith has reorganized its operating structure into
three reporting segments: Digital, Magazine, and Local
Media.
Fiscal 2022 first quarter revenues grew 2 percent to
$709 million. Looking more closely at
the quarter:
- Digital revenues grew 24 percent to $200 million. Performance was led by strong
29 percent growth in digital advertising revenues. Meredith
continues to benefit from its proprietary technology platform that
brings together strong content and trusted brands, unique taxonomy,
and first party data. Digital consumer revenues grew 24 percent,
with performance driven by Apple News+ and performance marketing
via retail partners, including Walmart, Amazon, and Target.
- Magazine revenues declined 2 percent to $305 million. Magazine consumer related
revenue, which accounted for nearly two-thirds of the segment's
revenue, grew 6 percent, driven by newsstand and subscription
revenue performance. Magazine advertising revenues declined as
expected, due primarily to the food, prescription drug, and beauty
categories, which continue to be adversely impacted by current
economic conditions including ongoing work-from-home protocols and
supply chain disruptions.
- Local Media Group revenues declined 7 percent to
$209 million. As expected in a
non-political year, political spot advertising revenues were lower
at $5 million compared to
$52 million. Non-political spot
advertising revenues grew 24 percent, reflecting a lack of
political advertising crowd out, and driven primarily by gaming,
professional services, and home categories. Retransmission revenue
growth was driven primarily by annual escalations.
Net earnings were $25 million,
compared to $42 million. Results
included a net special charge of $17
million primarily related to transaction costs, compared to
$8 million. Adjusted EBITDA was
$125 million, compared to
$143 million. Results reflect a
change in revenue mix with lower cyclical high-margin political
advertising and lower magazine advertising partially offset by
stronger digital performance.
Cash Flows from Operations and Free Cash Flow were $42 million and $35
million, respectively, compared to $79 million and $70
million, reflecting lower net earnings due to the factors
described above, along with higher employee-related costs.
Transaction update
Meredith remains on schedule to close its previously announced
transactions in calendar 2021, comprising:
- $2.825 billion Local Media Group
sale to Gray Television Inc. ("Gray"). Shareholders are expected to
receive $16.99 in cash per share;
and
- $2.7 billion sale of its
remaining operations, including its digital and magazine segments,
to IAC's Dotdash digital publishing unit. Shareholders are expected
to receive approximately $42.18 in
cash per share.
"We are extremely proud of our 120-year history of journalistic
integrity and dedication to building world class brands and
consumer experiences," Harty said. "We are focused on closing both
transactions and delivering value to shareholders. Looking ahead,
we are enthusiastic at the opportunity to further strengthen our
brands and consumer relationships as part of Gray and Dotdash
Meredith."
RATIONALE FOR USE AND ACCESS TO NON-GAAP RESULTS
Management uses and presents GAAP and non-GAAP results to
evaluate and communicate its performance. While non-GAAP measures
should not be construed as alternatives to GAAP measures,
management believes these non-GAAP measures are useful as an aid to
further understand Meredith's current performance, performance
trends, and financial condition.
Free Cash Flow, net earnings before special items, operating
profit before special items, consolidated and segment adjusted
EBITDA, and consolidated and segment adjusted EBITDA margin are
common supplemental measures of performance used by investors and
financial analysts. Management believes these measures provide
additional analytical tools. Free Cash Flow is defined as net cash
provided by operating activities less capital expenditures. This
metric has been included as a measure of the Company's liquidity
and ability to fund its operations. Net earnings before special
items and operating profit before special items remove the impact
of special items on net earnings and operating profit. Consolidated
adjusted EBITDA is defined as net earnings before interest expense,
income taxes, depreciation, amortization, and special items.
Segment adjusted EBITDA is defined as segment operating profit and
non-operating income, net before depreciation, amortization, and
special items. These special items have been removed as they have
been deemed to be non-operational in nature. Management does not
use adjusted EBITDA as a measure of liquidity or funds available
for management's discretionary use because it excludes certain
contractual and nondiscretionary expenditures. Reconciliations of
GAAP to non-GAAP measures are attached to this press release and at
Meredith.com.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This release contains certain forward-looking statements, as
defined in the Private Securities Litigation Reform Act of 1995,
that are subject to risks and uncertainties. These statements are
based on management's current knowledge and estimates of factors
affecting the Company and its operations. Statements in this
release that are forward-looking include, but are not limited to,
statements related to the timing of closing the Gray and Dotdash
transactions, expected price per share that shareholders will
receive in connection with such transactions, and anticipated
growth opportunities following the sales. Forward-looking
statements can be identified by words such as may, should, expects,
provides, anticipates, assumes, can, will, meets, could, likely,
intends, might, predicts, seeks, would, believes, estimates, plans,
continues, guidance, or outlook, or variations of these words or
similar expressions.
Actual results may differ materially from those currently
anticipated. Factors that could cause actual results to differ
materially from those projected in the forward-looking statements
include the following: market conditions; the impact of the
COVID-19 pandemic; downturns in global, national, and/or local
economies; a softening of the domestic advertising market; world,
national or local events that could disrupt broadcast television;
increased consolidation among major advertisers or other events
depressing the level of advertising spending; the unexpected loss
or insolvency of one or more major clients or vendors; the
integration of acquired businesses; changes in consumer reading,
purchasing, and/or television viewing patterns; increases in paper,
postage, printing, syndicated programming, or other costs; changes
in television network affiliation agreements; technological
developments affecting products or methods of distribution; changes
in government regulations affecting the Company's industries; the
parties' ability to consummate the previously announced proposed
sales; the conditions to the completion of the transactions,
including the receipt of approval of Meredith's shareholders; the
regulatory approvals required for the proposed sales not being
obtained on the terms expected or on the anticipated schedule; the
parties' ability to meet expectations regarding the timing,
completion, and accounting and tax treatments of the transactions;
potential inability to retain key employees; Additional information
concerning these and other risk factors can be found in Meredith's,
Gray's, and IAC's filings with the Securities and Exchange
Commission ("SEC"), which are available on the SEC's website at
www.sec.gov. Such risk factors may be amplified by the COVID-19
pandemic and its potential impact on the Company's business and the
global economy. Meredith, SpinCo (defined below), Gray, and IAC
assume no obligation to update or revise publicly the information
in this communication, whether as a result of new information,
future events, or otherwise, except as otherwise required by law.
Readers are cautioned not to place undue reliance on these
forward-looking statements that speak only as of the date
hereof.
ABOUT MEREDITH CORPORATION
Meredith Corporation (NYSE: MDP) is a multi-platform
media and marketing company that provides information and
inspiration to women's lives daily through our trusted brands,
including PEOPLE, Better Homes & Gardens, Allrecipes, Southern
Living, and REAL SIMPLE. We create content and experiences focused
on entertainment news, house and home, food, style, health,
fitness, travel and luxury, and parenting – priority topics for our
largely female audience.
With our long history of demonstrated integrity, editorial
excellence, and deep consumer insights, we have earned
relationships with 190 million Americans across media platforms,
including digital, magazines, performance marketing, and brand
licensing. Our rich proprietary data and sophisticated technology
platform provide unparalleled insights and best-in-class
advertising and performance marketing solutions.
Meredith's Local Media Group portfolio includes 17 television
stations concentrated in large, fast-growing markets, with seven
stations in the nation's Top 25 markets, including Atlanta, Phoenix, St.
Louis, and Portland.
Meredith has agreed to sell its operations in two separate
transactions for a combined $5.525
billion that are expected to return approximately
$59.17 per share cash to Meredith
shareholders. These transactions are expected to close later in
calendar 2021.
Additional information and where to find it
This
communication is not a solicitation of a proxy from any shareholder
of the Company. The Company's shareholders are neither required nor
being asked to vote on the Dotdash merger. However, in connection
with the transactions contemplated by the Gray merger, on
October 8, 2021, the Company filed an
amended preliminary proxy statement with the SEC and intends to
file relevant materials with the SEC, including a definitive proxy
statement. In addition, Meredith Holdings Corporation, the new
public company to be spun-off ("SpinCo"), intends to file a
registration statement on Form 10 with respect to its common stock.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THESE MATERIALS
WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE COMPANY, SPINCO, GRAY, THE PROPOSED GRAY
MERGER AND THE SPIN-OFF. The proxy statement and Form 10, and other
relevant materials (when they become available), and any other
documents filed by the Company, SpinCo, and Gray with the SEC, may
be obtained free of charge at the SEC's web site at www.sec.gov.
The documents filed by the Company may also be obtained for free
from the Company's Investor Relations web site
(http://ir.meredith.com) or by directing a request to the Company's
Shareholder/Financial Analyst contact, Mike
Lovell, Executive Director of Corporate Communications, at
515-284-3622.
Participants in the solicitation
The Company and Gray
and their respective executive officers and directors may be deemed
to be participants in the solicitation of proxies from the security
holders of the Company in connection with the proposed Gray merger
and spin-off. Information about Gray's directors and executive
officers is available in Gray's definitive proxy statement, dated
March 25, 2021, for its 2021 annual
meeting of shareholders. Information about the Company's directors
and executive officers is available in the Company's definitive
proxy statement, dated October 27,
2021, for its 2021 annual meeting of shareholders. Other
information regarding the participants and description of their
direct and indirect interests, by security holdings or otherwise,
is contained in the amended preliminary proxy statement regarding
the Gray merger and the spin-off that the Company filed with the
SEC on October 8, 2021, and will be
contained in the definitive proxy statement and Form 10
registration statement regarding the proposed Gray merger and
spin-off that the Company and SpinCo will file, respectively, with
the SEC when they become available.
Meredith
Corporation and Subsidiaries
|
Condensed
Consolidated Statements of Earnings (Unaudited)
|
|
Three months ended
September 30,
|
2021
|
|
2020
|
(In millions
except per share data)
|
|
|
|
Revenues
|
|
|
|
Advertising
related
|
$
|
338.2
|
|
|
$
|
358.5
|
|
Consumer
related
|
345.9
|
|
|
318.7
|
|
Other
|
24.5
|
|
|
16.3
|
|
Total
revenues
|
708.6
|
|
|
693.5
|
|
Operating
expenses
|
|
|
|
Production,
distribution, and editorial
|
266.4
|
|
|
241.1
|
|
Selling, general, and
administrative
|
319.0
|
|
|
311.2
|
|
Acquisition,
disposition, and restructuring related activities
|
18.4
|
|
|
14.1
|
|
Depreciation and
amortization
|
28.8
|
|
|
49.0
|
|
Total operating
expenses
|
632.6
|
|
|
615.4
|
|
Income from
operations
|
76.0
|
|
|
78.1
|
|
Non-operating income,
net
|
1.5
|
|
|
5.6
|
|
Interest expense,
net
|
(38.3)
|
|
|
(43.5)
|
|
Earnings before
income taxes
|
39.2
|
|
|
40.2
|
|
Income tax benefit
(expense)
|
(14.4)
|
|
|
2.1
|
|
Net
earnings
|
$
|
24.8
|
|
|
$
|
42.3
|
|
|
|
|
|
Basic earnings per
share attributable to common shareholders
|
|
|
|
Basic earnings per
common share
|
$
|
0.52
|
|
|
$
|
0.88
|
|
Basic average common
shares outstanding
|
46.5
|
|
|
46.0
|
|
|
|
|
|
Diluted earnings
per share attributable to common shareholders
|
|
|
|
Diluted earnings per
common share
|
$
|
0.51
|
|
|
$
|
0.88
|
|
Diluted average
common shares outstanding
|
47.2
|
|
|
46.0
|
|
Meredith
Corporation and Subsidiaries
|
Segment
Information (Unaudited)
|
|
Three months ended
September 30,
|
2021
|
|
2020
|
(In
millions)
|
|
|
|
Revenues
|
|
|
|
Advertising
related
|
|
|
|
Digital
|
$
|
138.9
|
|
|
$
|
111.0
|
|
Magazine
|
91.1
|
|
|
116.6
|
|
Local Media
|
108.8
|
|
|
131.1
|
|
Intersegment revenue
elimination
|
(0.6)
|
|
|
(0.2)
|
|
Total advertising
related
|
338.2
|
|
|
358.5
|
|
Consumer
related
|
|
|
|
Digital
|
60.0
|
|
|
48.5
|
|
Magazine
|
194.5
|
|
|
183.4
|
|
Local Media
|
96.9
|
|
|
91.6
|
|
Intersegment revenue
elimination
|
(5.5)
|
|
|
(4.8)
|
|
Total consumer
related
|
345.9
|
|
|
318.7
|
|
Other
|
|
|
|
Digital
|
1.3
|
|
|
1.4
|
|
Magazine
|
19.5
|
|
|
11.6
|
|
Local Media
|
3.7
|
|
|
3.3
|
|
Total other
|
24.5
|
|
|
16.3
|
|
Total
revenues
|
$
|
708.6
|
|
|
$
|
693.5
|
|
|
|
|
|
Operating
profit
|
|
|
|
Digital
|
$
|
56.3
|
|
|
$
|
25.8
|
|
Magazine
|
4.6
|
|
|
5.7
|
|
Local
Media
|
46.6
|
|
|
63.8
|
|
Unallocated
corporate
|
(31.5)
|
|
|
(17.2)
|
|
Income from
operations
|
$
|
76.0
|
|
|
$
|
78.1
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
|
Digital
|
$
|
7.7
|
|
|
$
|
15.8
|
|
Magazine
|
14.0
|
|
|
24.2
|
|
Local
Media
|
6.7
|
|
|
8.6
|
|
Unallocated
corporate
|
0.4
|
|
|
0.4
|
|
Total depreciation
and amortization
|
$
|
28.8
|
|
|
$
|
49.0
|
|
|
|
|
|
Adjusted EBITDA
1
|
|
|
|
Digital
|
$
|
64.5
|
|
|
$
|
42.5
|
|
Magazine
|
19.3
|
|
|
33.6
|
|
Local
Media
|
53.6
|
|
|
79.9
|
|
Unallocated
corporate
|
(12.7)
|
|
|
(12.8)
|
|
Total adjusted
EBITDA
|
$
|
124.7
|
|
|
$
|
143.2
|
|
|
1
|
Adjusted EBITDA is
net earnings before interest expense, income taxes, depreciation,
amortization, and special items.
|
Continued
|
Meredith
Corporation and Subsidiaries
|
Segment
Information (Unaudited)
|
|
Three months ended
September 30,
|
2021
|
|
2020
|
(In
millions)
|
|
|
|
Revenues
|
|
|
|
Digital
|
|
|
|
Advertising
|
$
|
135.6
|
|
|
$
|
105.1
|
|
Third party
sales
|
3.3
|
|
|
5.9
|
|
Total advertising
related
|
138.9
|
|
|
111.0
|
|
Licensing
|
31.7
|
|
|
24.1
|
|
Affinity
marketing
|
7.4
|
|
|
7.0
|
|
Digital and other
consumer driven
|
20.9
|
|
|
17.4
|
|
Total consumer
related
|
60.0
|
|
|
48.5
|
|
Other
|
1.3
|
|
|
1.4
|
|
Total
Digital
|
200.2
|
|
|
160.9
|
|
Magazine
|
|
|
|
Advertising
|
90.4
|
|
|
108.5
|
|
Third party
sales
|
0.7
|
|
|
8.1
|
|
Total advertising
related
|
91.1
|
|
|
116.6
|
|
Subscription
|
136.9
|
|
|
133.4
|
|
Newsstand
|
43.3
|
|
|
35.1
|
|
Affinity
marketing
|
13.6
|
|
|
12.2
|
|
Digital and other
consumer driven
|
0.7
|
|
|
2.7
|
|
Total consumer
related
|
194.5
|
|
|
183.4
|
|
Project
based
|
13.9
|
|
|
9.9
|
|
Other
|
5.6
|
|
|
1.7
|
|
Total other
|
19.5
|
|
|
11.6
|
|
Total
Magazine
|
305.1
|
|
|
311.6
|
|
Local
Media
|
|
|
|
Non-political
spot
|
70.6
|
|
|
56.8
|
|
Political
spot
|
5.0
|
|
|
51.7
|
|
Digital
|
5.4
|
|
|
4.3
|
|
Third party
sales
|
27.8
|
|
|
18.3
|
|
Total advertising
related
|
108.8
|
|
|
131.1
|
|
Retransmission
|
96.7
|
|
|
91.4
|
|
Digital and other
consumer driven
|
0.2
|
|
|
0.2
|
|
Total consumer
related
|
96.9
|
|
|
91.6
|
|
Other
|
3.7
|
|
|
3.3
|
|
Total Local
Media
|
209.4
|
|
|
226.0
|
|
Intersegment revenue
elimination
|
(6.1)
|
|
|
(5.0)
|
|
Total
revenues
|
$
|
708.6
|
|
|
$
|
693.5
|
|
Meredith
Corporation and Subsidiaries
|
Condensed
Consolidated Balance Sheets (Unaudited)
|
|
Assets
|
September 30,
2021
|
|
June
30, 2021
|
(In
millions)
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
269.0
|
|
|
$
|
240.2
|
|
Accounts receivable,
net
|
501.3
|
|
|
501.1
|
|
Inventories
|
29.7
|
|
|
29.3
|
|
Current portion of
subscription acquisition costs
|
226.2
|
|
|
225.6
|
|
Other current
assets
|
58.0
|
|
|
115.9
|
|
Total current
assets
|
1,084.2
|
|
|
1,112.1
|
|
Property, plant, and
equipment, net
|
347.1
|
|
|
360.6
|
|
Operating lease
assets
|
364.3
|
|
|
371.0
|
|
Subscription
acquisition costs
|
178.5
|
|
|
180.4
|
|
Other
assets
|
264.8
|
|
|
265.6
|
|
Intangible assets,
net
|
1,545.2
|
|
|
1,556.8
|
|
Goodwill
|
1,719.2
|
|
|
1,719.3
|
|
Total
assets
|
$
|
5,503.3
|
|
|
$
|
5,565.8
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
Current
liabilities
|
|
|
|
Current portion of
long-term debt
|
$
|
4.1
|
|
|
$
|
4.1
|
|
Current portion of
operating lease liabilities
|
36.5
|
|
|
36.2
|
|
Accounts
payable
|
195.1
|
|
|
185.1
|
|
Accrued expenses and
other liabilities
|
140.5
|
|
|
237.7
|
|
Current portion of
unearned revenues
|
401.3
|
|
|
396.4
|
|
Total current
liabilities
|
777.5
|
|
|
859.5
|
|
Long-term
debt
|
2,743.5
|
|
|
2,741.9
|
|
Operating lease
liabilities
|
425.0
|
|
|
432.1
|
|
Unearned
revenues
|
215.6
|
|
|
218.8
|
|
Deferred income
taxes
|
462.4
|
|
|
462.4
|
|
Other noncurrent
liabilities
|
198.8
|
|
|
199.0
|
|
Total
liabilities
|
4,822.8
|
|
|
4,913.7
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
Common
stock
|
40.7
|
|
|
40.6
|
|
Class B
stock
|
5.1
|
|
|
5.1
|
|
Additional paid-in
capital
|
185.7
|
|
|
178.5
|
|
Retained
earnings
|
531.1
|
|
|
506.3
|
|
Accumulated other
comprehensive loss
|
(82.1)
|
|
|
(78.4)
|
|
Total
shareholders' equity
|
680.5
|
|
|
652.1
|
|
Total liabilities
and shareholders' equity
|
$
|
5,503.3
|
|
|
$
|
5,565.8
|
|
Meredith
Corporation and Subsidiaries
|
Condensed
Consolidated Statements of Cash Flows (Unaudited)
|
|
Three months ended
September 30,
|
2021
|
|
2020
|
(In
millions)
|
|
|
|
Net cash provided
by operating activities
|
$
|
42.3
|
|
|
$
|
78.9
|
|
|
|
|
|
Cash flows from
investing activities
|
|
|
|
Additions to property,
plant, and equipment
|
(7.8)
|
|
|
(9.3)
|
|
Other
|
—
|
|
|
0.3
|
|
Net cash used in
investing activities
|
(7.8)
|
|
|
(9.0)
|
|
|
|
|
|
Cash flows from
financing activities
|
|
|
|
Repayments of
long-term debt
|
(1.0)
|
|
|
(1.0)
|
|
Purchases of Company
stock
|
(8.5)
|
|
|
(0.4)
|
|
Proceeds from common
stock issued
|
6.0
|
|
|
0.4
|
|
Payment of acquisition
related contingent consideration
|
(1.3)
|
|
|
—
|
|
Financing lease
payments
|
(0.7)
|
|
|
(0.6)
|
|
Net cash used in
financing activities
|
(5.5)
|
|
|
(1.6)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(0.2)
|
|
|
0.3
|
|
Net increase in cash
and cash equivalents
|
28.8
|
|
|
68.6
|
|
Cash and cash
equivalents at beginning of period
|
240.2
|
|
|
132.4
|
|
Cash and cash
equivalents at end of period
|
$
|
269.0
|
|
|
$
|
201.0
|
|
Table
1
|
Meredith
Corporation and Subsidiaries
|
Supplemental
Disclosures Regarding Non-GAAP Financial Measures
|
|
Adjusted
EBITDA
|
The following tables
show results of operations as reported under accounting principles
generally accepted in the United States of America (GAAP) and
adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure.
Management's rationale for presenting non-GAAP measures is included
in the text of this earnings release.
|
|
Consolidated adjusted
EBITDA, which is reconciled to net earnings in Table 3, is defined
as net earnings before interest expense, income taxes,
depreciation, amortization, and special items.
|
|
Segment adjusted
EBITDA is a measure of segment operating profit and non-operating
income, net before depreciation, amortization, and special
items.
|
Three months
ended
September 30,
|
|
Revenues
|
|
YoY
Change
|
|
Operating
profit
|
|
YoY
Change
|
|
Adjusted
EBITDA
|
|
YoY
Change
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Digital
|
|
$
|
200.2
|
|
|
24
|
%
|
|
$
|
56.3
|
|
|
F
|
|
$
|
64.5
|
|
|
52
|
%
|
Magazine
|
|
305.1
|
|
|
(2)
|
%
|
|
4.6
|
|
|
(19)
|
%
|
|
19.3
|
|
|
(43)
|
%
|
Local Media
Group
|
|
209.4
|
|
|
(7)
|
%
|
|
46.6
|
|
|
(27)
|
%
|
|
53.6
|
|
|
(33)
|
%
|
Unallocated
corporate
|
|
n/a
|
|
|
n/a
|
|
(31.5)
|
|
|
83
|
%
|
|
(12.7)
|
|
|
(1)
|
%
|
Intersegment
elimination
|
|
(6.1)
|
|
|
22
|
%
|
|
n/a
|
|
|
n/a
|
|
n/a
|
|
|
n/a
|
Total
|
|
$
|
708.6
|
|
|
2
|
%
|
|
$
|
76.0
|
|
|
(3)
|
%
|
|
$
|
124.7
|
|
|
(13)
|
%
|
F represents
favorable improvements greater than 100%
|
n/a - not
applicable
|
Table
2
|
Meredith
Corporation and Subsidiaries
|
Supplemental
Disclosures Regarding Non-GAAP Financial Measures
|
|
Special
Items - The following table shows net earnings as
reported under GAAP and excluding the special items. Net earnings
before special items is a non-GAAP measure. Management's rationale
for presenting non-GAAP measures is included in the text of this
earnings release.
|
Three months ended
September 30,
|
2021
|
|
2020
|
(In millions
except per share data)
|
|
|
|
Net
earnings
|
$
|
24.8
|
|
|
$
|
42.3
|
|
Special
items
|
|
|
|
Transaction
costs
|
11.5
|
|
|
—
|
|
Integration and
restructuring costs
|
3.5
|
|
|
3.6
|
|
Severance and related
benefit costs
|
0.1
|
|
|
12.4
|
|
Gain on
investment
|
—
|
|
|
(3.6)
|
|
Other
|
3.3
|
|
|
(1.9)
|
|
Special items
subtotal
|
18.4
|
|
|
10.5
|
|
Tax benefit on
special items
|
(1.8)
|
|
|
(2.7)
|
|
Net special
items
|
16.6
|
|
|
7.8
|
|
Net earnings before
special items (non-GAAP)
|
$
|
41.4
|
|
|
$
|
50.1
|
|
|
|
|
|
Diluted earnings
per share attributable to common shareholders before
special items (non-GAAP)
|
|
|
|
Diluted earnings per
common share
|
$
|
0.51
|
|
|
$
|
0.88
|
|
Per share impact of
net special items
|
0.35
|
|
|
0.16
|
|
Diluted earnings per
share before special items (non-GAAP)
|
$
|
0.86
|
|
|
$
|
1.04
|
|
Table
3
|
Meredith
Corporation and Subsidiaries
|
Supplemental
Disclosures Regarding Non-GAAP Financial Measures
|
|
Special
Items
|
The following tables
show results of operations as reported under GAAP and excluding the
special items. Results of operations excluding the special items
are non-GAAP measures. Management's rationale for presenting
non-GAAP measures is included in the text of this earnings
release.
|
|
Adjusted
EBITDA
|
Consolidated adjusted
EBITDA, which is reconciled to net earnings in the following
tables, is defined as net earnings before interest expense, income
taxes, depreciation, amortization, and special items.
|
|
Segment adjusted
EBITDA is a measure of segment operating profit and non-operating
income, net before depreciation, amortization, and special items.
Segment adjusted EBITDA margin is defined as segment adjusted
EBITDA divided by segment revenues.
|
Three months ended
September 30, 2021
|
Digital
|
Magazine
|
Local
Media
|
Unallocated
Corporate
|
Total
|
(In
millions)
|
|
|
|
|
|
Revenues
|
$
|
200.2
|
|
$
|
305.1
|
|
$
|
209.4
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
24.8
|
|
Income tax
expense
|
14.4
|
|
Interest expense,
net
|
38.3
|
|
Non-operating income,
net
|
(1.5)
|
|
Operating
profit
|
$
|
56.3
|
|
$
|
4.6
|
|
$
|
46.6
|
|
$
|
(31.5)
|
|
76.0
|
|
Special items
included in operating profit
|
|
|
|
|
|
Transaction
costs
|
—
|
|
—
|
|
—
|
|
11.5
|
|
11.5
|
|
Integration and
restructuring costs
|
—
|
|
—
|
|
—
|
|
3.5
|
|
3.5
|
|
Severance and related
benefit costs
|
—
|
|
—
|
|
—
|
|
0.1
|
|
0.1
|
|
Other
|
—
|
|
—
|
|
—
|
|
3.3
|
|
3.3
|
|
Total special items
included in operating profit
|
—
|
|
—
|
|
—
|
|
18.4
|
|
18.4
|
|
Operating profit
before special items (non-GAAP)
|
56.3
|
|
4.6
|
|
46.6
|
|
(13.1)
|
|
94.4
|
|
Non-operating income,
net
|
0.5
|
|
0.7
|
|
0.3
|
|
—
|
|
1.5
|
|
Depreciation and
amortization
|
7.7
|
|
14.0
|
|
6.7
|
|
0.4
|
|
28.8
|
|
Adjusted EBITDA
(non-GAAP)
|
$
|
64.5
|
|
$
|
19.3
|
|
$
|
53.6
|
|
$
|
(12.7)
|
|
$
|
124.7
|
|
|
|
|
|
|
|
Segment operating
margin
|
28.1
|
%
|
1.5
|
%
|
22.3
|
%
|
|
|
Segment adjusted
EBITDA margin
|
32.2
|
%
|
6.3
|
%
|
25.6
|
%
|
|
|
Table 3
Continued
|
|
Three months ended
September 30, 2020
|
Digital
|
Magazine
|
Local
Media
|
Unallocated
Corporate
|
Total
|
(In
millions)
|
|
|
|
|
|
Revenues
|
$
|
160.9
|
|
$
|
311.6
|
|
$
|
226.0
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
42.3
|
|
Income tax
benefit
|
(2.1)
|
|
Interest expense,
net
|
43.5
|
|
Non-operating income,
net
|
(5.6)
|
|
Operating
profit
|
$
|
25.8
|
|
$
|
5.7
|
|
$
|
63.8
|
|
$
|
(17.2)
|
|
78.1
|
|
Special items
included in operating profit
|
|
|
|
|
|
Severance and related
benefit costs
|
0.8
|
|
3.8
|
|
7.2
|
|
0.6
|
|
12.4
|
|
Integration and
restructuring costs
|
0.2
|
|
—
|
|
—
|
|
3.4
|
|
3.6
|
|
Other
|
(0.1)
|
|
(0.8)
|
|
—
|
|
(1.0)
|
|
(1.9)
|
|
Total special items
included in operating profit
|
0.9
|
|
3.0
|
|
7.2
|
|
3.0
|
|
14.1
|
|
Operating profit
before special items (non-GAAP)
|
26.7
|
|
8.7
|
|
71.0
|
|
(14.2)
|
|
92.2
|
|
Non-operating income,
net
|
3.6
|
|
0.7
|
|
0.3
|
|
1.0
|
|
5.6
|
|
Special item included
in non-operating income, net – gain on sale of
investment
|
(3.6)
|
|
—
|
|
—
|
|
—
|
|
(3.6)
|
|
Depreciation and
amortization
|
15.8
|
|
24.2
|
|
8.6
|
|
0.4
|
|
49.0
|
|
Adjusted EBITDA
(non-GAAP)
|
$
|
42.5
|
|
$
|
33.6
|
|
$
|
79.9
|
|
$
|
(12.8)
|
|
$
|
143.2
|
|
|
|
|
|
|
|
Segment operating
margin
|
16.0
|
%
|
1.8
|
%
|
28.2
|
%
|
|
|
Segment adjusted
EBITDA margin
|
26.4
|
%
|
10.8
|
%
|
35.4
|
%
|
|
|
Table
4
|
Meredith
Corporation and Subsidiaries
|
Supplemental
Disclosures Regarding Non-GAAP Financial Measures
|
|
Free Cash
Flow – The following table presents net cash provided
by operating activities as reported under GAAP and additions to
property, plant, and equipment also as reported under GAAP. Free
Cash Flow is a non-GAAP measure. Management's rationale for
presenting non-GAAP measures is included in the text of this
earnings release.
|
Three months ended
September 30,
|
2021
|
|
2020
|
(In
millions)
|
|
|
|
Net cash provided by
operating activities
|
$
|
42.3
|
|
|
$
|
78.9
|
|
Less: additions to
property, plant, and equipment
|
(7.8)
|
|
|
(9.3)
|
|
Free cash
flow
|
$
|
34.5
|
|
|
$
|
69.6
|
|
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SOURCE Meredith Corporation