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Share Name | Share Symbol | Market | Type |
---|---|---|---|
New Gannett Co Inc | NYSE:GCI | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.11 | 3.59% | 3.17 | 3.2199 | 3.03 | 3.13 | 3,085,614 | 01:00:00 |
Strong Improvement in Digital Advertising Revenues
Gannett Co., Inc. (NYSE: GCI) ("Gannett" or "company" or "we" or "our") today reported first quarter 2018 financial results for the period ended March 31, 2018. Our first quarter 2018 comprised 90 days, one less day (Sunday) than our first quarter 2017.
"We are pleased with the momentum we saw this quarter in digital advertising revenues, which reached 43.6% of total advertising revenues in the quarter," said Robert J. Dickey, president and chief executive officer. "Overall, first quarter results were ahead of our expectations driven by solid growth in digital advertising revenues, especially within the digital marketing services category."
"We also experienced lower than expected costs in the quarter primarily driven by favorable savings in compensation and benefits," said Ali Engel, senior vice president and chief financial officer. "This quarter's strong results are a testament to our continued focus on efficiencies to drive steady cash flow, while also investing for our future. Finally, we were pleased to complete a $200 million convertible debt financing in early April that provides us continued flexibility to execute on our strategic transformation."
First Quarter 2018 Consolidated Results
First Quarter 2018 Publishing Segment
First Quarter 2018 ReachLocal Segment
First Quarter 2018 Cash Flow
Outlook
For 2018, the company reiterates the following:
* * * *
Conference Call Information
The company will hold a conference call at 10:00 a.m. ET today to discuss its first quarter results. The call can be accessed via a live webcast through the company's investor site, http://investors.gannett.com/, or listen-only conference lines. U.S. callers should dial 855-462-1958 and international callers should dial 503-343-6635 at least 10 minutes prior to the scheduled start of the call. The confirmation code for the conference call is 4367227. A conference call replay will be available through June 5, 2018. U.S. callers should dial 855-859-2056 and international callers should dial 404-537-3406.
Forward Looking Statements
This press release contains certain forward-looking statements regarding business strategies, market potential, future financial performance and other matters. Forward-looking statements include all statements that are not historical facts. The words “believe,” “expect,” “estimate,” “could,” “should,” “intend,” “may,” “plan,” “seek,” “anticipate,” “project” and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made and are not guarantees of future performance. Where, in any forward-looking statement, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of our management and expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. Whether or not any such forward-looking statements are in fact achieved will depend on future events, some of which are beyond our control. The matters discussed in these forward-looking statements are subject to a number of risks, trends, uncertainties and other factors that could cause actual results to differ materially from those projected, anticipated or implied in the forward-looking statements. These factors include, among other things:
A further description of these and other important risks, trends, uncertainties and other factors is provided in the company’s filings with the U.S. Securities and Exchange Commission, including the company’s annual report on Form 10-K for fiscal year 2017. Any forward-looking statements should be evaluated in light of these important risk factors. The company is not responsible for updating or revising any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Non-GAAP Financial Measures
This press release also contains a discussion of certain non-GAAP financial measures that the company presents to allow investors and analysts to measure, analyze and compare its financial condition and results of operations in a meaningful and consistent manner. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures can be found in the tables accompanying this press release.
About Gannett
Gannett Co., Inc. (NYSE: GCI) is an innovative, digitally focused media and marketing solutions company committed to strengthening communities across our network. With an unmatched local-to-national reach, Gannett touches the lives of more than 110 million people monthly with our Pulitzer-Prize winning content, consumer experiences and benefits, and advertiser products and services. Gannett brands include USA TODAY NETWORK with the iconic USA TODAY and more than 100 local media brands, digital marketing services companies ReachLocal and SweetIQ, and U.K. media company Newsquest. To connect with us, visit www.gannett.com.
CONSOLIDATED STATEMENTS OF INCOME (LOSS)Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands (except per share amounts)
Table No. 1 Three months endedMarch 31,2018
March 26,2017
Operating revenues: Advertising $ 399,525 $ 435,515 Circulation 266,586 283,286 Other 56,840 54,656 Total operating revenues 722,951 773,457 Operating expenses: Cost of sales and operating expenses 456,984 499,718 Selling, general and administrative expenses 212,999 209,560 Depreciation and amortization 40,252 46,817 Restructuring costs 9,299 12,551 Asset impairment charges 3,756 3,778 Total operating expenses 723,290 772,424 Operating income (loss) (339 ) 1,033 Non-operating expenses: Interest expense (4,478 ) (4,255 ) Other non-operating items, net 4,311 (3,887 ) Total non-operating expenses (167 ) (8,142 ) Loss before income taxes (506 ) (7,109 ) Benefit for income taxes (129 ) (5,030 ) Net loss $ (377 ) $ (2,079 ) Loss per share - basic $ (0.00 ) $ (0.02 ) Loss per share - diluted $ (0.00 ) $ (0.02 ) Weighted average number of common shares outstanding: Basic 112,756 113,495 Diluted 112,756 113,495 SEGMENT INFORMATIONGannett Co., Inc. and Subsidiaries
Unaudited, in thousands
Table No. 2 Three months endedMarch 31,2018
March 26,2017
Operating revenues: Publishing $ 638,660 $ 694,924 ReachLocal 96,488 77,565 Corporate and Other 1,976 968 Intersegment eliminations (14,173 ) — Total $ 722,951 $ 773,457 Adjusted EBITDA: Publishing $ 77,758 $ 91,664 ReachLocal 6,209 3,146 Corporate and Other (28,899 ) (25,129 ) Total $ 55,068 $ 69,681 Depreciation and amortization: Publishing $ 26,289 $ 33,425 ReachLocal 8,513 7,875 Corporate and Other 5,450 5,517 Total $ 40,252 $ 46,817 Capital expenditures: Publishing $ 4,109 $ 9,496 ReachLocal 3,508 3,686 Corporate and Other 5,931 1,858 Total $ 13,548 $ 15,040 SAME STORE REVENUE DETAILGannett Co., Inc. and Subsidiaries
Unaudited, in thousands
Table No. 3 Three months endedMarch 31,2018
March 26,2017
% Change
Reported revenue $ 722,951 $ 773,457 (6.5 %) Acquired revenues (11,181 ) — *** Currency impact (7,507 ) — *** Day-adjusted impacts — (14,612 ) *** Same store revenue $ 704,263 $ 758,845 (7.2 %) Reported advertising revenue $ 399,525 $ 435,515 (8.3 %) Acquired revenues (4,794 ) — *** Currency impact (4,970 ) — *** Day-adjusted impacts — (8,435 ) *** Same store advertising revenue $ 389,761 $ 427,080 (8.7 %) Reported circulation revenue $ 266,586 $ 283,286 (5.9 %) Acquired revenues (1,343 ) — *** Currency impact (2,177 ) — *** Day-adjusted impacts — (5,994 ) *** Same store circulation revenue $ 263,066 $ 277,292 (5.1 %) PUBLISHING REVENUE DETAILGannett Co., Inc. and Subsidiaries
Unaudited, in thousands
Table No. 4 Three months endedMarch 31,2018
March 26,2017
% Change Publishing revenue detail Print advertising: Local $ 99,630 $ 119,255 (16.5 %) Classified 78,400 91,115 (14.0 %) National 47,483 60,108 (21.0 %) Total print advertising 225,513 270,478 (16.6 %) Digital advertising: Digital media 64,386 59,419 8.4 % Digital classified 19,982 23,216 (13.9 %) Digital marketing services 17,109 11,972 42.9 % Total digital advertising 101,477 94,607 7.3 % Total advertising 326,990 365,085 (10.4 %) Circulation 266,586 283,286 (5.9 %) Other 45,084 46,553 (3.2 %) Total Publishing revenue $ 638,660 $ 694,924 (8.1 %)USE OF NON-GAAP INFORMATION
The company uses non-GAAP financial performance and liquidity measures to supplement the financial information presented on a 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 GAAP measures and should be read together with financial information presented on a GAAP basis.
The company defines its non-GAAP measures as follows:
The company uses non-GAAP financial measures for purposes of evaluating its performance and liquidity. Therefore, the company believes that each of the non-GAAP measures presented provides useful information to investors by allowing them to view our businesses through the eyes of our management and Board of Directors, facilitating comparison of results across historical periods, and providing a focus on the underlying ongoing operating performance of our business. Many of our peer group companies present similar non-GAAP measures to better facilitate industry comparisons.
NON-GAAP FINANCIAL INFORMATIONADJUSTED EBITDA
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
Table No. 5 Three months ended March 31, 2018 Publishing ReachLocalCorporate andOther
ConsolidatedTotal
Net loss (GAAP basis) $ (377 ) Benefit for income taxes (129 ) Interest expense 4,478 Other non-operating items, net (4,311 ) Operating income (loss) (GAAP basis) $ 39,165 $ (2,926 ) $ (36,578 ) $ (339 ) Depreciation and amortization 26,289 8,513 5,450 40,252 Restructuring costs 8,277 539 483 9,299 Asset impairment charges 3,756 — — 3,756 Acquisition-related items — 16 908 924 Other items 271 67 838 1,176 Adjusted EBITDA (non-GAAP basis) $ 77,758 $ 6,209 $ (28,899 ) $ 55,068 Three months ended March 26, 2017 Publishing ReachLocalCorporate andOther
ConsolidatedTotal
Net loss (GAAP basis) $ (2,079 ) Benefit for income taxes (5,030 ) Interest expense 4,255 Other non-operating items, net 3,887 Operating income (loss) (GAAP basis) $ 43,519 $ (4,772 ) $ (37,714 ) $ 1,033 Depreciation and amortization 33,425 7,875 5,517 46,817 Restructuring costs 11,121 — 1,430 12,551 Asset impairment charges 3,778 — — 3,778 Acquisition-related items (333 ) 43 1,313 1,023 Other items 154 — 4,325 4,479 Adjusted EBITDA (non-GAAP basis) $ 91,664 $ 3,146 $ (25,129 ) $ 69,681 NON-GAAP FINANCIAL INFORMATIONADJUSTED DILUTED EPS
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands (except per share amounts)
Table No. 6 Three months endedMarch 31,2018
March 26,2017
Restructuring costs (including accelerated depreciation) $ 14,460 $ 22,332 Asset impairment charges 3,756 3,778 Acquisition-related items 924 1,023 Non-operating losses 134 158 Other items 714 1,504 Pretax impact 19,988 28,795 Income tax impact of above items (4,926 ) (11,038 ) Impact of items affecting comparability on net income $ 15,062 $ 17,757 Net loss (GAAP basis) $ (377 ) $ (2,079 ) Impact of items affecting comparability on net income (loss) 15,062 17,757 Adjusted net income (non-GAAP basis) $ 14,685 $ 15,678 Loss per share - diluted (GAAP basis) $ (0.00 ) $ (0.02 ) Impact of items affecting comparability on net income (loss) 0.13 0.16 Adjusted earnings per share - diluted (non-GAAP basis) $ 0.13 $ 0.14 Diluted weighted average number of common shares outstanding (GAAP basis) 112,756 113,495 Diluted weighted average number of common shares outstanding (non-GAAP basis) 115,851 115,273 NON-GAAP FINANCIAL INFORMATIONFREE CASH FLOW
Gannett Co., Inc. and Subsidiaries
Unaudited, in thousands
Table No. 7Three months endedMarch 31, 2018
Net cash flow from operating activities (GAAP basis) $ 65,153 Capital expenditures (13,548 ) Free cash flow (non-GAAP basis) $ 51,605
View source version on businesswire.com: https://www.businesswire.com/news/home/20180507005298/en/
Gannett Co., Inc.For investor inquiries:Stacy Cunningham, 703-854-3168VP, Financial Planning & Investor Relationsinvestors@gannett.comorThe Blueshirt GroupBrinlea Johnsoninvestors@gannett.comorFor media inquiries:Amber Allman, 703-854-5358Vice President, Corporate Events & Communicationsaallman@gannett.com
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