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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 | 2,350,651 | 19:34:43 |
|
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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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
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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|
|
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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)
|
|
(Zip Code)
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Large Accelerated Filer
|
ý
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Accelerated Filer
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¨
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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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Title of Each Class
|
|
Trading Symbol
|
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Name of Each Exchange on Which Registered
|
Common Stock, par value $0.01 per share
|
|
GCI
|
|
The New York Stock Exchange
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Item No.
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|
Page
|
|
|
|
|
|
|
1
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||
|
|
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2
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||
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|
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3
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||
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|
|
4
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||
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|
|
|
|
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1
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||
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|
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1A
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||
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|
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2
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||
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3
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||
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4
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||
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5
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||
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6
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March 31, 2019
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December 31, 2018
|
||||
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(Unaudited)
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
89,380
|
|
|
$
|
93,559
|
|
Accounts receivable, net of allowance for doubtful accounts of $10,126 and $11,088
|
294,442
|
|
|
343,617
|
|
||
Other current assets
|
147,849
|
|
|
143,385
|
|
||
Total current assets
|
531,671
|
|
|
580,561
|
|
||
Property, plant and equipment, at cost net of accumulated depreciation of $1,351,392 and $1,412,531
|
770,738
|
|
|
796,009
|
|
||
Operating lease assets
|
258,693
|
|
|
—
|
|
||
Goodwill
|
783,897
|
|
|
779,597
|
|
||
Intangible assets, net
|
160,707
|
|
|
170,344
|
|
||
Deferred income taxes
|
42,241
|
|
|
51,039
|
|
||
Other assets
|
112,247
|
|
|
100,861
|
|
||
Total assets
|
$
|
2,660,194
|
|
|
$
|
2,478,411
|
|
|
|
|
|
||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
320,620
|
|
|
$
|
387,003
|
|
Deferred revenue
|
119,080
|
|
|
117,083
|
|
||
Other current liabilities
|
89,782
|
|
|
47,482
|
|
||
Total current liabilities
|
529,482
|
|
|
551,568
|
|
||
Postretirement medical and life insurance liabilities
|
66,721
|
|
|
69,938
|
|
||
Pension liabilities
|
309,919
|
|
|
319,084
|
|
||
Long-term portion of revolving credit facility
|
130,000
|
|
|
135,000
|
|
||
Convertible debt
|
170,538
|
|
|
169,264
|
|
||
Long-term operating lease liabilities
|
267,630
|
|
|
—
|
|
||
Other noncurrent liabilities
|
147,182
|
|
|
198,451
|
|
||
Total liabilities
|
1,621,472
|
|
|
1,443,305
|
|
||
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, 120,216,140 and 118,875,977 shares issued
|
1,202
|
|
|
1,189
|
|
||
Treasury stock at cost, 5,750,000 shares
|
(50,046
|
)
|
|
(50,046
|
)
|
||
Additional paid-in capital
|
1,822,967
|
|
|
1,822,094
|
|
||
Accumulated deficit
|
(138,225
|
)
|
|
(121,435
|
)
|
||
Accumulated other comprehensive loss
|
(597,176
|
)
|
|
(616,696
|
)
|
||
Total equity
|
1,038,722
|
|
|
1,035,106
|
|
||
Total liabilities and equity
|
$
|
2,660,194
|
|
|
$
|
2,478,411
|
|
|
Three months ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
|
|
|
||||
Operating revenues:
|
|
|
|
||||
Advertising and marketing services
|
$
|
365,235
|
|
|
$
|
410,312
|
|
Circulation
|
252,727
|
|
|
266,586
|
|
||
Other
|
45,463
|
|
|
46,053
|
|
||
Total operating revenues
|
663,425
|
|
|
722,951
|
|
||
|
|
|
|
||||
Operating expenses:
|
|
|
|
||||
Cost of sales
|
411,164
|
|
|
456,984
|
|
||
Selling, general and administrative expenses
|
200,102
|
|
|
212,999
|
|
||
Depreciation and amortization
|
37,045
|
|
|
40,252
|
|
||
Restructuring costs
|
20,959
|
|
|
9,299
|
|
||
Asset impairment charges
|
529
|
|
|
3,756
|
|
||
Total operating expenses
|
669,799
|
|
|
723,290
|
|
||
Operating loss
|
(6,374
|
)
|
|
(339
|
)
|
||
|
|
|
|
||||
Non-operating income (expense):
|
|
|
|
||||
Interest expense
|
(6,965
|
)
|
|
(4,478
|
)
|
||
Other non-operating items, net
|
(2,148
|
)
|
|
4,311
|
|
||
Non-operating expense
|
(9,113
|
)
|
|
(167
|
)
|
||
|
|
|
|
||||
Loss before income taxes
|
(15,487
|
)
|
|
(506
|
)
|
||
Benefit for income taxes
|
(3,582
|
)
|
|
(129
|
)
|
||
Net loss
|
$
|
(11,905
|
)
|
|
$
|
(377
|
)
|
|
|
|
|
||||
Loss per share - basic
|
$
|
(0.10
|
)
|
|
$
|
(0.00
|
)
|
Loss per share - diluted
|
$
|
(0.10
|
)
|
|
$
|
(0.00
|
)
|
|
Three months ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
|
|
|
||||
Net loss
|
$
|
(11,905
|
)
|
|
$
|
(377
|
)
|
Other comprehensive income, before tax:
|
|
|
|
||||
Foreign currency translation adjustments
|
13,057
|
|
|
19,374
|
|
||
Pension and other postretirement benefit items:
|
|
|
|
||||
Amortization of prior service credit, net
|
(1,336
|
)
|
|
(404
|
)
|
||
Amortization of actuarial loss
|
15,797
|
|
|
15,476
|
|
||
Other
|
(5,283
|
)
|
|
(13,417
|
)
|
||
Pension and other postretirement benefit items
|
9,178
|
|
|
1,655
|
|
||
Other comprehensive income, before tax
|
22,235
|
|
|
21,029
|
|
||
Income tax effect related to components of other comprehensive income
|
(2,715
|
)
|
|
(1,154
|
)
|
||
Other comprehensive income, net of tax
|
19,520
|
|
|
19,875
|
|
||
Comprehensive income
|
$
|
7,615
|
|
|
$
|
19,498
|
|
|
Three months ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
|
|
|
||||
Operating activities:
|
|
|
|
||||
Net loss
|
$
|
(11,905
|
)
|
|
$
|
(377
|
)
|
Adjustments to reconcile net loss to net cash flow from operating activities:
|
|
|
|
||||
Depreciation and amortization
|
37,045
|
|
|
40,252
|
|
||
Restructuring costs
|
11,086
|
|
|
2,734
|
|
||
Asset impairment charges
|
529
|
|
|
3,756
|
|
||
Pension and other postretirement expenses, net of contributions
|
(9,178
|
)
|
|
(16,372
|
)
|
||
Stock-based compensation
|
5,084
|
|
|
4,652
|
|
||
Change in other assets and liabilities, net
|
4,878
|
|
|
30,508
|
|
||
Net cash provided by operating activities
|
37,539
|
|
|
65,153
|
|
||
Investing activities:
|
|
|
|
||||
Capital expenditures
|
(12,583
|
)
|
|
(13,548
|
)
|
||
Payments for investments
|
(137
|
)
|
|
(2,000
|
)
|
||
Proceeds from sale of certain assets
|
985
|
|
|
3,596
|
|
||
Changes in other investing activities
|
—
|
|
|
3,929
|
|
||
Net cash used for investing activities
|
(11,735
|
)
|
|
(8,023
|
)
|
||
Financing activities:
|
|
|
|
||||
Dividends paid
|
(18,326
|
)
|
|
(18,057
|
)
|
||
Payments for employee taxes withheld from stock awards
|
(1,502
|
)
|
|
(2,697
|
)
|
||
Proceeds from borrowings under revolving credit agreement
|
15,000
|
|
|
—
|
|
||
Repayments of borrowings under revolving credit agreement
|
(20,000
|
)
|
|
(50,000
|
)
|
||
Proceeds from sale and leaseback transaction
|
—
|
|
|
37,719
|
|
||
Deferred payments for acquisitions
|
(4,853
|
)
|
|
—
|
|
||
Changes in other financing activities
|
117
|
|
|
(8
|
)
|
||
Net cash used for financing activities
|
(29,564
|
)
|
|
(33,043
|
)
|
||
Effect of currency exchange rate change on cash
|
327
|
|
|
1,157
|
|
||
Increase (decrease) in cash and cash equivalents and restricted cash
|
(3,433
|
)
|
|
25,244
|
|
||
Balance of cash, cash equivalents, and restricted cash at beginning of period
|
116,861
|
|
|
144,032
|
|
||
Balance of cash, cash equivalents, and restricted cash at end of period
|
$
|
113,428
|
|
|
$
|
169,276
|
|
|
|
|
|
||||
Supplemental cash flow information:
|
|
|
|
||||
Cash paid for taxes, net of refunds
|
$
|
(1,170
|
)
|
|
$
|
687
|
|
Cash paid for interest
|
$
|
1,720
|
|
|
$
|
3,132
|
|
Non-cash investing and financing activities:
|
|
|
|
||||
Accrued capital expenditures
|
$
|
540
|
|
|
$
|
2,864
|
|
|
March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Cash and cash equivalents
|
$
|
89,380
|
|
|
$
|
145,859
|
|
Restricted cash included in other current assets
|
3,593
|
|
|
3,189
|
|
||
Restricted cash included in investments and other assets
|
20,455
|
|
|
20,228
|
|
||
Total cash, cash equivalents, and restricted cash
|
$
|
113,428
|
|
|
$
|
169,276
|
|
|
Three months ended March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Print advertising
|
$
|
186,192
|
|
|
$
|
225,826
|
|
Digital advertising and marketing services
|
179,043
|
|
|
184,486
|
|
||
Total advertising and marketing services
|
365,235
|
|
|
410,312
|
|
||
Circulation
|
252,727
|
|
|
266,586
|
|
||
Other
|
45,463
|
|
|
46,053
|
|
||
Total revenues
|
$
|
663,425
|
|
|
$
|
722,951
|
|
In thousands
|
Advertising and Other
|
|
Circulation
|
|
Total
|
||||||
Beginning balance
|
$
|
35,742
|
|
|
$
|
81,341
|
|
|
$
|
117,083
|
|
Cash receipts
|
70,730
|
|
|
207,726
|
|
|
278,456
|
|
|||
Revenue recognized
|
(69,912
|
)
|
|
(206,547
|
)
|
|
(276,459
|
)
|
|||
Ending balance
|
$
|
36,560
|
|
|
$
|
82,520
|
|
|
$
|
119,080
|
|
In thousands
|
|
||
Operating lease cost
(a)
|
$
|
16,983
|
|
Short-term lease cost, excluding expenses relating to leases with a lease term of one month or less
|
479
|
|
|
Net lease cost
|
$
|
17,462
|
|
In thousands
|
Year Ending December 31,
(a)
|
||
2019 (excluding the three months ended March 31, 2019)
|
$
|
40,367
|
|
2020
|
53,741
|
|
|
2021
|
48,353
|
|
|
2022
|
44,535
|
|
|
2023
|
37,297
|
|
|
Thereafter
|
191,460
|
|
|
Total future minimum lease payments
|
415,753
|
|
|
Less: Imputed interest
|
110,545
|
|
|
Total
|
$
|
305,208
|
|
In thousands, except lease term and discount rate
|
|
||
Supplemental cash flow information
|
|
||
Cash paid for amounts included in the measurement of lease liabilities
|
$
|
18,475
|
|
Right-of-use assets obtained in exchange for lease obligations
|
$
|
9,300
|
|
Weighted-average remaining lease term (in years)
|
9.1
|
|
|
Weighted-average discount rate
|
6.7
|
%
|
In thousands
|
|
||
Cash and restricted cash acquired
|
$
|
20,954
|
|
Other current assets
|
9,159
|
|
|
Property, plant and equipment
|
1,072
|
|
|
Developed technology
|
63,030
|
|
|
Customer relationships
|
21,420
|
|
|
Trade names
|
1,105
|
|
|
Goodwill
|
67,483
|
|
|
Total assets acquired
|
184,223
|
|
|
Current liabilities
|
3,987
|
|
|
Noncurrent liabilities
|
17,303
|
|
|
Total liabilities assumed
|
21,290
|
|
|
Net assets acquired
|
$
|
162,933
|
|
|
Three months ended March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Publishing
|
$
|
7,160
|
|
|
$
|
5,628
|
|
ReachLocal
|
20
|
|
|
539
|
|
||
Corporate and Other
|
2,693
|
|
|
398
|
|
||
Total
|
$
|
9,873
|
|
|
$
|
6,565
|
|
In thousands
|
|
||
Beginning balance
|
$
|
32,974
|
|
Expense
|
9,873
|
|
|
Payments
|
(29,421
|
)
|
|
Ending balance
|
$
|
13,426
|
|
|
Three months ended March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Publishing
|
$
|
1,646
|
|
|
$
|
2,649
|
|
ReachLocal
|
120
|
|
|
—
|
|
||
Corporate and Other
|
37
|
|
|
85
|
|
||
Total
|
$
|
1,803
|
|
|
$
|
2,734
|
|
|
Three months ended March 31,
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
In thousands
|
Pension
|
|
OPEB
|
|
Pension
|
|
OPEB
|
||||||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Service cost - Benefits earned during the period
|
$
|
429
|
|
|
$
|
32
|
|
|
$
|
602
|
|
|
$
|
55
|
|
Non-operating expenses:
|
|
|
|
|
|
|
|
||||||||
Interest cost on benefit obligation
|
25,696
|
|
|
782
|
|
|
25,421
|
|
|
783
|
|
||||
Expected return on plan assets
|
(36,534
|
)
|
|
—
|
|
|
(44,549
|
)
|
|
—
|
|
||||
Amortization of prior service cost (benefit)
|
(524
|
)
|
|
(812
|
)
|
|
479
|
|
|
(883
|
)
|
||||
Amortization of actuarial loss (gain)
|
16,027
|
|
|
(230
|
)
|
|
15,381
|
|
|
95
|
|
||||
Curtailments
|
—
|
|
|
192
|
|
|
—
|
|
|
—
|
|
||||
Other
|
—
|
|
|
(1,018
|
)
|
|
—
|
|
|
—
|
|
||||
Total non-operating expenses (credit)
|
$
|
4,665
|
|
|
$
|
(1,086
|
)
|
|
$
|
(3,268
|
)
|
|
$
|
(5
|
)
|
Total expense (benefit) for retirement plans
|
$
|
5,094
|
|
|
$
|
(1,054
|
)
|
|
$
|
(2,666
|
)
|
|
$
|
50
|
|
|
Three months ended March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Pre-tax net loss
|
$
|
(15,487
|
)
|
|
$
|
(506
|
)
|
Income tax benefit
|
(3,582
|
)
|
|
(129
|
)
|
||
Effective tax rate
|
23.1
|
%
|
|
25.5
|
%
|
|
Three months ended March 31, 2019
|
||||||||||||||||||||||
In thousands, except per share data
|
Common Stock, $0.01 Par Value
|
|
Treasury Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Total
|
||||||||||||
Beginning balance
|
$
|
1,189
|
|
|
$
|
(50,046
|
)
|
|
$
|
1,822,094
|
|
|
$
|
(121,435
|
)
|
|
$
|
(616,696
|
)
|
|
$
|
1,035,106
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,905
|
)
|
|
—
|
|
|
(11,905
|
)
|
||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,520
|
|
|
19,520
|
|
||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
7,615
|
|
||||||||||
Dividends declared: $0.16 per share
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,326
|
)
|
|
—
|
|
|
(18,326
|
)
|
||||||
Adoption of new lease guidance
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
13,441
|
|
|
—
|
|
|
13,441
|
|
||||||
Restricted stock awards settled
|
13
|
|
|
—
|
|
|
(4,410
|
)
|
|
—
|
|
|
—
|
|
|
(4,397
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
5,084
|
|
|
—
|
|
|
—
|
|
|
5,084
|
|
||||||
Other activity
|
—
|
|
|
—
|
|
|
199
|
|
|
—
|
|
|
—
|
|
|
199
|
|
||||||
Ending balance
|
$
|
1,202
|
|
|
$
|
(50,046
|
)
|
|
$
|
1,822,967
|
|
|
$
|
(138,225
|
)
|
|
$
|
(597,176
|
)
|
|
$
|
1,038,722
|
|
|
Three months ended March 31, 2018
|
||||||||||||||||||||||
In thousands, except per share data
|
Common Stock, $0.01 Par Value
|
|
Treasury Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
Total
|
||||||||||||
Beginning balance
|
$
|
1,175
|
|
|
$
|
(50,046
|
)
|
|
$
|
1,786,941
|
|
|
$
|
(64,158
|
)
|
|
$
|
(656,517
|
)
|
|
$
|
1,017,395
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(377
|
)
|
|
—
|
|
|
(377
|
)
|
||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,875
|
|
|
19,875
|
|
||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
19,498
|
|
|||||||||||
Dividends declared: $0.16 per share
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,935
|
)
|
|
—
|
|
|
(17,935
|
)
|
||||||
Restricted stock awards settled
|
7
|
|
|
—
|
|
|
(3,202
|
)
|
|
—
|
|
|
—
|
|
|
(3,195
|
)
|
||||||
Performance share units settled
|
4
|
|
|
—
|
|
|
(2,437
|
)
|
|
—
|
|
|
—
|
|
|
(2,433
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
4,652
|
|
|
—
|
|
|
—
|
|
|
4,652
|
|
||||||
Other activity
|
—
|
|
|
—
|
|
|
470
|
|
|
—
|
|
|
—
|
|
|
470
|
|
||||||
Ending balance
|
$
|
1,186
|
|
|
$
|
(50,046
|
)
|
|
$
|
1,786,424
|
|
|
$
|
(82,470
|
)
|
|
$
|
(636,642
|
)
|
|
$
|
1,018,452
|
|
|
Three months ended March 31, 2019
|
||||||||||
In thousands
|
Retirement Plans
|
|
Foreign Currency Translation
|
|
Total
|
||||||
Beginning balance
|
$
|
(929,170
|
)
|
|
$
|
312,474
|
|
|
$
|
(616,696
|
)
|
Other comprehensive income (loss) before reclassifications
|
(4,443
|
)
|
|
13,057
|
|
|
8,614
|
|
|||
Amounts reclassified from accumulated other comprehensive loss
|
10,906
|
|
|
—
|
|
|
10,906
|
|
|||
Other comprehensive income
|
6,463
|
|
|
13,057
|
|
|
19,520
|
|
|||
Ending balance
|
$
|
(922,707
|
)
|
|
$
|
325,531
|
|
|
$
|
(597,176
|
)
|
|
Three months ended March 31, 2018
|
||||||||||
In thousands
|
Retirement Plans
|
|
Foreign Currency Translation
|
|
Total
|
||||||
Beginning balance
|
$
|
(1,000,790
|
)
|
|
$
|
344,273
|
|
|
$
|
(656,517
|
)
|
Other comprehensive income (loss) before reclassifications
|
(10,868
|
)
|
|
19,374
|
|
|
8,506
|
|
|||
Amounts reclassified from accumulated other comprehensive loss
|
11,369
|
|
|
—
|
|
|
11,369
|
|
|||
Other comprehensive income
|
501
|
|
|
19,374
|
|
|
19,875
|
|
|||
Ending balance
|
$
|
(1,000,289
|
)
|
|
$
|
363,647
|
|
|
$
|
(636,642
|
)
|
|
Three months ended March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Amortization of prior service credit, net
|
$
|
(1,336
|
)
|
|
$
|
(404
|
)
|
Amortization of actuarial loss
|
15,797
|
|
|
15,476
|
|
||
Total reclassifications, before tax
|
14,461
|
|
|
15,072
|
|
||
Income tax effect
|
(3,555
|
)
|
|
(3,703
|
)
|
||
Total reclassifications, net of tax
|
$
|
10,906
|
|
|
$
|
11,369
|
|
•
|
Publishing, which consists of our portfolio of local, regional, national, and international newspaper publishers. The results of this segment include local, classified, and national advertising revenues consisting of both print and digital advertising, circulation revenues from the distribution of our publications on our digital platforms, home delivery of our publications, single copy sales, and other revenues from commercial printing and distribution arrangements. The publishing reportable segment is an aggregation of
two
operating segments: domestic publishing and the U.K.
|
•
|
ReachLocal, which consists exclusively of our ReachLocal digital marketing solutions subsidiaries including SweetIQ and WordStream. The results of this segment include advertising revenues from our search and display services and revenues related to web presence and software solutions provided by ReachLocal.
|
|
Three months ended March 31, 2019
|
||||||||||||||||||
In thousands
|
Publishing
|
|
ReachLocal
|
|
Corporate and Other
|
|
Intersegment Eliminations
|
|
Consolidated
|
||||||||||
Advertising and marketing services - external sales
|
$
|
268,054
|
|
|
$
|
97,181
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
365,235
|
|
Advertising and marketing services - intersegment sales
|
14,526
|
|
|
—
|
|
|
—
|
|
|
(14,526
|
)
|
|
—
|
|
|||||
Circulation
|
252,727
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
252,727
|
|
|||||
Other
|
43,860
|
|
|
—
|
|
|
1,603
|
|
|
—
|
|
|
45,463
|
|
|||||
Total revenues
|
$
|
579,167
|
|
|
$
|
97,181
|
|
|
$
|
1,603
|
|
|
$
|
(14,526
|
)
|
|
$
|
663,425
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
81,383
|
|
|
$
|
7,631
|
|
|
$
|
(25,688
|
)
|
|
$
|
—
|
|
|
$
|
63,326
|
|
|
Three months ended March 31, 2018
|
||||||||||||||||||
In thousands
|
Publishing
|
|
ReachLocal
|
|
Corporate and Other
|
|
Intersegment Eliminations
|
|
Consolidated
|
||||||||||
Advertising and marketing services - external sales
|
$
|
313,824
|
|
|
$
|
96,488
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
410,312
|
|
Advertising and marketing services - intersegment sales
|
14,173
|
|
|
—
|
|
|
—
|
|
|
(14,173
|
)
|
|
—
|
|
|||||
Circulation
|
266,586
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
266,586
|
|
|||||
Other
|
44,077
|
|
|
—
|
|
|
1,976
|
|
|
—
|
|
|
46,053
|
|
|||||
Total revenues
|
$
|
638,660
|
|
|
$
|
96,488
|
|
|
$
|
1,976
|
|
|
$
|
(14,173
|
)
|
|
$
|
722,951
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA
|
$
|
77,758
|
|
|
$
|
6,209
|
|
|
$
|
(28,899
|
)
|
|
$
|
—
|
|
|
$
|
55,068
|
|
|
Three months ended March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Net loss (GAAP basis)
|
$
|
(11,905
|
)
|
|
$
|
(377
|
)
|
Benefit for income taxes
|
(3,582
|
)
|
|
(129
|
)
|
||
Interest expense
|
6,965
|
|
|
4,478
|
|
||
Other non-operating items, net
|
2,148
|
|
|
(4,311
|
)
|
||
Operating loss (GAAP basis)
|
(6,374
|
)
|
|
(339
|
)
|
||
Depreciation and amortization
|
37,045
|
|
|
40,252
|
|
||
Restructuring costs
|
20,959
|
|
|
9,299
|
|
||
Asset impairment charges
|
529
|
|
|
3,756
|
|
||
Other items
|
11,167
|
|
|
2,100
|
|
||
Adjusted EBITDA (non-GAAP basis)
|
$
|
63,326
|
|
|
$
|
55,068
|
|
|
Three months ended March 31,
|
|||||||||
In thousands
|
2019
|
|
2018
|
|
Change
|
|||||
Operating revenues:
|
|
|
|
|
|
|||||
Publishing
|
$
|
579,167
|
|
|
$
|
638,660
|
|
|
(9
|
%)
|
ReachLocal
|
97,181
|
|
|
96,488
|
|
|
1
|
%
|
||
Corporate and other
|
1,603
|
|
|
1,976
|
|
|
(19
|
%)
|
||
Intersegment eliminations
|
(14,526
|
)
|
|
(14,173
|
)
|
|
2
|
%
|
||
Total operating revenues
|
663,425
|
|
|
722,951
|
|
|
(8
|
%)
|
||
Operating expenses:
|
|
|
|
|
|
|||||
Publishing
|
$
|
537,889
|
|
|
$
|
599,495
|
|
|
(10
|
%)
|
ReachLocal
|
105,404
|
|
|
99,414
|
|
|
6
|
%
|
||
Corporate and other
|
41,032
|
|
|
38,554
|
|
|
6
|
%
|
||
Intersegment eliminations
|
(14,526
|
)
|
|
(14,173
|
)
|
|
2
|
%
|
||
Total operating expenses
|
669,799
|
|
|
723,290
|
|
|
(7
|
%)
|
||
Operating loss
|
(6,374
|
)
|
|
(339
|
)
|
|
***
|
|
||
Non-operating expense
|
(9,113
|
)
|
|
(167
|
)
|
|
***
|
|
||
Loss before income taxes
|
(15,487
|
)
|
|
(506
|
)
|
|
***
|
|
||
Benefit for income taxes
|
(3,582
|
)
|
|
(129
|
)
|
|
***
|
|
||
Net loss
|
$
|
(11,905
|
)
|
|
$
|
(377
|
)
|
|
***
|
|
|
|
|
|
|
|
|||||
Loss per share - diluted
|
$
|
(0.10
|
)
|
|
$
|
(0.00
|
)
|
|
***
|
|
|
Three months ended March 31,
|
|||||||||
In thousands
|
2019
|
|
2018
|
|
Change
|
|||||
Operating revenues:
|
|
|
|
|
|
|||||
Advertising and marketing services
|
$
|
282,580
|
|
|
$
|
327,997
|
|
|
(14
|
%)
|
Circulation
|
252,727
|
|
|
266,586
|
|
|
(5
|
%)
|
||
Other
|
43,860
|
|
|
44,077
|
|
|
—
|
%
|
||
Total operating revenues
|
579,167
|
|
|
638,660
|
|
|
(9
|
%)
|
||
Operating expenses:
|
|
|
|
|
|
|
||||
Cost of sales
|
369,438
|
|
|
412,003
|
|
|
(10
|
%)
|
||
Selling, general and administrative expenses
|
130,093
|
|
|
149,170
|
|
|
(13
|
%)
|
||
Depreciation and amortization
|
19,739
|
|
|
26,289
|
|
|
(25
|
%)
|
||
Restructuring costs
|
18,089
|
|
|
8,277
|
|
|
***
|
|
||
Asset impairment charges
|
530
|
|
|
3,756
|
|
|
(86
|
%)
|
||
Total operating expenses
|
537,889
|
|
|
599,495
|
|
|
(10
|
%)
|
||
Operating income
|
$
|
41,278
|
|
|
$
|
39,165
|
|
|
5
|
%
|
|
Three months ended March 31,
|
|||||||||
In thousands
|
2019
|
|
2018
|
|
Change
|
|||||
Operating income (GAAP basis)
|
$
|
41,278
|
|
|
$
|
39,165
|
|
|
5
|
%
|
Depreciation and amortization
|
19,739
|
|
|
26,289
|
|
|
(25
|
%)
|
||
Restructuring costs
|
18,089
|
|
|
8,277
|
|
|
***
|
|
||
Asset impairment charges
|
530
|
|
|
3,756
|
|
|
(86
|
%)
|
||
Other items
|
1,747
|
|
|
271
|
|
|
***
|
|
||
Adjusted EBITDA (non-GAAP basis)
|
$
|
81,383
|
|
|
$
|
77,758
|
|
|
5
|
%
|
|
Three months ended March 31,
|
|||||||||
In thousands
|
2019
|
|
2018
|
|
Change
|
|||||
Operating revenues:
|
|
|
|
|
|
|||||
Advertising and marketing services
|
$
|
97,181
|
|
|
$
|
96,488
|
|
|
1
|
%
|
Total operating revenues
|
97,181
|
|
|
96,488
|
|
|
1
|
%
|
||
Operating expenses:
|
|
|
|
|
|
|||||
Cost of sales
|
52,105
|
|
|
54,972
|
|
|
(5
|
)%
|
||
Selling, general and administrative expenses
|
40,228
|
|
|
35,390
|
|
|
14
|
%
|
||
Depreciation and amortization
|
12,932
|
|
|
8,513
|
|
|
52
|
%
|
||
Restructuring costs
|
139
|
|
|
539
|
|
|
(74
|
)%
|
||
Total operating expenses
|
105,404
|
|
|
99,414
|
|
|
6
|
%
|
||
Operating loss
|
$
|
(8,223
|
)
|
|
$
|
(2,926
|
)
|
|
***
|
|
As of date
|
March 31, 2019
|
|
December 31, 2018
|
||
Active Clients
(a)
|
19,500
|
|
|
20,800
|
|
Active Product Units
(b)
|
40,500
|
|
|
40,300
|
|
|
Three months ended March 31,
|
|||||||||
In thousands
|
2019
|
|
2018
|
|
Change
|
|||||
Operating loss (GAAP basis)
|
$
|
(8,223
|
)
|
|
$
|
(2,926
|
)
|
|
***
|
|
Depreciation and amortization
|
12,932
|
|
|
8,513
|
|
|
52
|
%
|
||
Restructuring costs
|
139
|
|
|
539
|
|
|
(74
|
%)
|
||
Other items
|
2,783
|
|
|
83
|
|
|
***
|
|
||
Adjusted EBITDA (non-GAAP basis)
|
$
|
7,631
|
|
|
$
|
6,209
|
|
|
23
|
%
|
|
Three months ended March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Net cash provided by operating activities
|
$
|
37,539
|
|
|
$
|
65,153
|
|
Net cash used for investing activities
|
(11,735
|
)
|
|
(8,023
|
)
|
||
Net cash used for financing activities
|
(29,564
|
)
|
|
(33,043
|
)
|
||
Effect of currency exchange rate change on cash
|
327
|
|
|
1,157
|
|
||
Net increase (decrease) in cash
|
$
|
(3,433
|
)
|
|
$
|
25,244
|
|
•
|
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) restructuring costs, (6) asset impairment charges, (7) other items (including acquisition-related expenses, certain business transformation costs, litigation expenses, and gains or losses on certain investments), and (8) depreciation and 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 the purpose of 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. When adjusted net income is described in this report, 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 as EPS before tax-effected (1) restructuring costs, (2) asset impairment charges, (3) non-operating gains and losses, and (4) other items (including acquisition-related expenses, certain business transformation
|
•
|
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 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. When free cash flow is discussed in this report, the most directly comparable GAAP financial measure is net cash from operating activities.
|
|
Three months ended March 31,
|
|||||||||
In thousands
|
2019
|
|
2018
|
|
Change
|
|||||
Net loss (GAAP basis)
|
$
|
(11,905
|
)
|
|
$
|
(377
|
)
|
|
***
|
|
Benefit for income taxes
|
(3,582
|
)
|
|
(129
|
)
|
|
***
|
|
||
Interest expense
|
6,965
|
|
|
4,478
|
|
|
56
|
%
|
||
Other non-operating items, net
|
2,148
|
|
|
(4,311
|
)
|
|
***
|
|
||
Operating loss (GAAP basis)
|
(6,374
|
)
|
|
(339
|
)
|
|
***
|
|
||
Depreciation and amortization
|
37,045
|
|
|
40,252
|
|
|
(8
|
%)
|
||
Restructuring costs
|
20,959
|
|
|
9,299
|
|
|
***
|
|
||
Asset impairment charges
|
529
|
|
|
3,756
|
|
|
(86
|
%)
|
||
Other items
|
11,167
|
|
|
2,100
|
|
|
***
|
|
||
Adjusted EBITDA (non-GAAP basis)
|
$
|
63,326
|
|
|
$
|
55,068
|
|
|
15
|
%
|
|
Three months ended March 31,
|
|||||||||
In thousands, except per share data
|
2019
|
|
2018
|
|
Change
|
|||||
Restructuring costs (including accelerated depreciation)
|
$
|
22,660
|
|
|
$
|
14,460
|
|
|
57
|
%
|
Asset impairment charges
|
529
|
|
|
3,756
|
|
|
(86
|
%)
|
||
Loss (gain) from non-operating activities
|
(1,384
|
)
|
|
134
|
|
|
***
|
|
||
Other items
|
10,519
|
|
|
1,638
|
|
|
***
|
|
||
Pretax impact
|
32,324
|
|
|
19,988
|
|
|
62
|
%
|
||
Income tax impact of above items
|
(8,198
|
)
|
|
(4,926
|
)
|
|
66
|
%
|
||
Impact of items affecting comparability on net income
|
$
|
24,126
|
|
|
$
|
15,062
|
|
|
60
|
%
|
|
|
|
|
|
|
|||||
Net loss (GAAP basis)
|
$
|
(11,905
|
)
|
|
$
|
(377
|
)
|
|
***
|
|
Impact of items affecting comparability on net income
|
24,126
|
|
|
15,062
|
|
|
60
|
%
|
||
Adjusted net income (non-GAAP basis)
|
$
|
12,221
|
|
|
$
|
14,685
|
|
|
(17
|
%)
|
|
|
|
|
|
|
|||||
Loss per share - diluted (GAAP basis)
|
$
|
(0.10
|
)
|
|
$
|
(0.00
|
)
|
|
***
|
|
Impact of items affecting comparability on net income
|
0.20
|
|
|
0.13
|
|
|
54
|
%
|
||
Adjusted earnings per share - diluted (non-GAAP basis)
|
$
|
0.10
|
|
|
$
|
0.13
|
|
|
(23
|
%)
|
|
|
|
|
|
|
|||||
Diluted weighted average number of common shares outstanding (GAAP basis)
|
114,448
|
|
|
112,756
|
|
|
2
|
%
|
||
Diluted weighted average number of common shares outstanding (non-GAAP basis)
|
118,058
|
|
|
115,851
|
|
|
2
|
%
|
|
Three months ended March 31,
|
||||
In thousands
|
2019
|
|
2018
|
||
Weighted average number of shares outstanding - basic and diluted (GAAP basis)
|
114,448
|
|
|
112,756
|
|
Effect of dilutive securities (non-GAAP basis)
|
|
|
|
||
Restricted stock units
|
1,355
|
|
|
2,249
|
|
Performance share units
|
2,227
|
|
|
756
|
|
Stock options
|
28
|
|
|
90
|
|
Weighted average number of shares outstanding - diluted (non-GAAP basis)
|
118,058
|
|
|
115,851
|
|
|
Three months ended March 31,
|
||||||
In thousands
|
2019
|
|
2018
|
||||
Net cash flow provided by operating activities (GAAP basis)
|
$
|
37,539
|
|
|
$
|
65,153
|
|
Capital expenditures
|
(12,583
|
)
|
|
(13,548
|
)
|
||
Free cash flow (non-GAAP basis)
|
$
|
24,956
|
|
|
$
|
51,605
|
|
•
|
Our ability to achieve our strategic transformation;
|
•
|
Potential disruption due to the reorganization of our sales force;
|
•
|
An accelerated decline in general print readership and/or advertiser patterns as a result of changing consumer preferences, 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, challenges associated with new delivery platforms, declines in web traffic levels, technical failures, and proliferation of ad blocking technologies;
|
•
|
Competitive pressures in the markets in which we operate;
|
•
|
Macroeconomic trends and conditions;
|
•
|
Increases in newsprint costs over the levels anticipated or declines in newsprint supply;
|
•
|
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;
|
•
|
Potential disruption or interruption of our IT systems due to accidents, extraordinary weather events, civil unrest, political events, terrorism or cyber security attacks;
|
•
|
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 related to MNG Enterprises, Inc.'s unsolicited proposal to acquire the company and related nomination of three candidates for election to the company's board of directors, which could, among other matters, cause us to incur significant expense and impact the trading value of our securities;
|
•
|
Variability in the exchange rate relative to the U.S. dollar of currencies in foreign jurisdictions in which we operate;
|
•
|
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;
|
•
|
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;
|
•
|
Risks to our liquidity related to the redemption, conversion, and similar features of our convertible notes;
|
•
|
Political, economic, and market uncertainty resulting from the pending withdrawal of the U.K. from the European Union; and
|
•
|
Other uncertainties relating to general economic, political, business, industry, regulatory and market conditions.
|
10-1
|
|
Employment Retention Agreement, dated as of January 15, 2019, by and between Gannett Co., Inc. and Maribel Perez Wadsworth.*
|
|
|
|
|
|
|
|
31-1
|
|
Rule 13a-14(a) Certification of CEO
|
|
|
|
|
|
|
|
31-2
|
|
Rule 13a-14(a) Certification of CFO
|
|
|
|
|
|
|
|
32-1
|
|
Section 1350 Certification of CEO
|
|
|
|
|
|
|
|
32-2
|
|
Section 1350 Certification of CFO
|
|
|
|
|
|
|
|
101
|
|
The following financial information from Gannett Co., Inc. Quarterly Report on Form 10-Q for the quarter ended March 31, 2019, formatted in XBRL: (i) Unaudited Condensed Consolidated Balance Sheets at March 31, 2019 and December 31, 2018, (ii) Unaudited Condensed Consolidated Statements of Income (Loss) for the fiscal quarters ended March 31, 2019 and March 31, 2018, (iii) Unaudited Condensed Consolidated Statements of Comprehensive Income for the fiscal quarters ended March 31, 2019 and March 31, 2018, (iv) Unaudited Condensed Consolidated Cash Flow Statements for the fiscal quarters ended March 31, 2019 and March 31, 2018, and (v) Unaudited Notes to Condensed Consolidated Financial Statements
|
|
Attached.
|
Date: May 6, 2019
|
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)
|
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