Usa Today Co., Inc. · NYSE:TDAY
Usa Today — Gannett — Q2 2024 Earnings Presentation
26 slides from Usa Today's earnings presentation, Aug 1, 2024
Slide 1: Q2 2024 Earnings
Q2 2024 Earnings August 1, 2024 1
Slide 2: Disclaimer and Notes
Disclaimer and Notes In General. This disclaimer applies to this document and the verbal or written comments of any person presenting it. This document, taken together with any such verbal or written comments, is referred to herein as the “Presentation.” Gannett Co., Inc. is referred to in this Pres
Slide 3: Gannett is a diversified media company with expansive reach
Gannett is a diversified media company with expansive reach at the national and local level dedicated to empowering and enriching communities. We seek to inspire, inform, and connect audiences as a sustainable, growth- focused media and digital marketing solutions company. Our strategy prioritizes m
Slide 4: Key Operating Pillars: Q2 2024 Highlights
Key Operating Pillars Strong focus on maximizing long-term shareholder value Q2 2024 Highlights (1) + Same store revenue trends improved sequentially 1 for the sixth consecutive quarter + Realized digital revenue growth across each key digital 2 revenue category versus the prior year period (1) + Ac
Slide 5: The Turning Point
The Turning Point We Believe Improvement in Key Financial Metrics Demonstrates Positive Momentum Total Digital Net Income Total Revenues Adjusted EBITDA(1) Revenues Attributable to Gannet Improved Grew Grew Grew ( ) Trends 2 6.2% $26.4M 4.8% $672.4M $278.4M $13.7M $74.6M $639.8M $262.1M $71.2M $(12.
Slide 6: Diversified Digital Revenue
Diversified Digital Revenue Revenue Expected to Continue to be Increasingly Digital Q2 2024 % Variance to Q2 2024 Total Revenue Mix Q2 2024 % of Total Prior Year Digital Advertising $84.5M 13% +4% YoY Digital Marketing Services $123.3M 19% +1% YoY 44% 56% Digital-only $46.3M 7% +22% YoY Digital Prin
Slide 7: Revenue Trend Improvement
Revenue Trend Improvement Continued Progress and Expect to Reach Inflection Point Exiting 2024 Same-Store Total Revenues(1) Total Digital Revenues as % of Total Revenues Year-over-Year (4)% 44% (5)% 43% 42% (6)% 41% (7)% 40% (8)% 39% (9)% 38% Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q2 23 Q3 23 Q4 23 Q1 24 Q2
Slide 8: Key Stats and Value Drivers
Key Stats and Value Drivers Executed on Growth Segments and Investment Strategy in Q2 2024 Diversified Digital Optimized Capital Expanded Reach Revenues Structure 185M $278.4M $24.3M Average Monthly Unique Visitors (1) Total Digital Revenues Total Debt Paydown 6.2% growth YoY 2.03M 44% Digital Reven
Slide 9: Q2 2024 Results and Non-GAAP Highlights
(1) Q2 2024 Results and Non-GAAP Highlights (1) Revenues Adjusted EBITDA ◦ $639.8M Total Revenues ◦ $74.6M Adjusted EBITDA(1) (1) (1) ◦ Same store revenues improved although were down 4.6% ◦ Adjusted EBITDA up $3.4 million, or 4.8% compared to the compared to Q2 2023. This represents a sequential pr
Slide 10: Business Outlook
(1) Business Outlook Following Q2 2024 Results, the Company Reiterates its Outlook Full Year 2024 2025-2026 Expected to accelerate with growth exceeding 10% year- Total Digital over-year Expected growth of approximately 10% Revenues Expected to make up 50% of total revenues in 2025 and exceed 55% of
Slide 11: Key Operating Pillars
Key Operating Pillars Second Quarter 2024 Update 11
Slide 12: Pillar One: Expanded Reach with our Customer Segments
Pillar One: Expanded Reach with our Customer Segments Q2 2024 Audience Metrics Total Digital Audience Digital-only Monetization Growth 1.95M 1.96M 1.99M 2.02M 2.03M 185M $7.62 $7.05 $7.22 $6.82 $6.35 (1) Average Monthly Unique Visitors Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 (2) (2) Digital-only Paid Subscrip
Slide 13: Pillar Two: Diversified Digital Revenue
Pillar Two: Diversified Digital Revenue Revenue Expected to Continue to be Increasingly Digital Total Digital Digital Marketing Digital-only Digital Advertising Digital Other Revenues Services Subscription $278.4M $84.5M $123.3M $46.3M $24.3M +6% YoY +4% YoY +1% YoY +22% YoY +20% YoY Grow Audience I
Slide 14: Pillar Three: Optimized Capital Structure
Pillar Three: Optimized Capital Structure Q2 2024 Balance Sheet and Liquidity Significant Debt Repayment Q2 2024 + Cash and cash equivalents of $98.9 million at the end of Q2 2024 $1,759M $1,575M + Total debt principal outstanding at June 30, 2024 of $1,089.9 million (1) $1,369M $1,272M ◦ Total net
Slide 15: Digital Marketing Solutions
Digital Marketing Solutions Second Quarter 2024 Update 15
Slide 16: Digital Marketing Solutions: Drive Digital Revenue Growth
Digital Marketing Solutions: Drive Digital Revenue Growth Digital Marketing Solutions – Dedicated to Helping Local Businesses Succeed Q2 2024 Results $122.8M (1) Core Platform Revenue 1.0% growth Year-over-Year $2,777 (1) Core Platform ARPU 5.1% growth Year-over-Year 14.7K (1) Core Platform Average
Slide 17: Digital Marketing Solutions: Drive DMS Growth
Digital Marketing Solutions: Drive DMS Growth Digital Marketing Solutions - Core Platform (1) (1) Revenues (M) Average Customer Count (K) $121.6 $120.8 $119.4 $122.8 $116.1 15.3 15.3 14.9 14.7 14.3 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 (1) (2) ARPU Customer Budget Retention $2,
Slide 18: Appendix
Appendix 18
Slide 19: Gannett Diversified Revenues
Gannett Diversified Revenues(1) Full Year Full Year Q2 2024 ($ in millions) Q2 2023 Q3 2023 Q4 2023 2023 2023 Q1 2024 Q2 2024 % of Total % of Total Digital advertising $81.5 $80.8 $91.1 $333.6 12.5% $84.5 $84.5 13.2% Digital marketing services $122.5 $121.9 $119.8 $477.0 17.9% $116.4 $123.3 19.3% Di
Slide 20: Debt and Leverage Overview
Debt and Leverage Overview ($ in millions) Rate Balance as of June 30, 2024 2024 Notes 4.75% $0.0 2027 Notes 6.0% $485.3 (1) (2) Senior Secured Term Loan (due 2026) 10.44% $326.1 2026 Senior Notes 6.0% $278.5 Total Debt Outstanding 7.33% Blended Rate $1,089.9 (3) Q2 2024 LTM Adjusted EBITDA $265.8 C
Slide 21: Non-GAAP Reconciliation
Non-GAAP Reconciliation The Company uses non-GAAP financial performance and liquidity measures to supplement the financial information presented on a U.S. generally accepted accounting principles ("U.S. GAAP") basis. These non-GAAP financial performance and liquidity measures, which may not be compa
Slide 22: Key Performance Indicators
Key Performance Indicators A key performance indicator ("KPI") is generally defined as a quantifiable measurement or metric used to gauge performance, specifically to help determine strategic, financial, and operational achievements, especially compared to those of similar businesses. We define Digi
Slide 23: Gannett Non-GAAP Reconciliation
(1) Gannett Non-GAAP Reconciliation Adjusted EBITDA 3 months ended June 30, 2024 Domestic Digital Corporate Total (in thousands) Gannett Newsquest Marketing and other Consolidated Media Solutions Net income (loss) attributable to Gannett $16,043 $14,058 $5,514 $(21,867) $13,748 Benefit for income ta
Slide 24: Gannett Non-GAAP Reconciliation
(1) Gannett Non-GAAP Reconciliation Adjusted EBITDA 3 months ended June 30, 2023 Domestic Digital Corporate Total (in thousands) Gannett Newsquest Marketing and other Consolidated Media Solutions Net income (loss) attributable to Gannett $22,786 $13,139 $9,273 $(57,875) $(12,677) Provision for incom
Slide 25: Gannett Non-GAAP Reconciliation
(1) Gannett Non-GAAP Reconciliation Adjusted Net Income attributable to Gannett and Free Cash Flow 3 months ended June 3 months ended June (in thousands) (in thousands) 30, 2024 30, 2023 Net income attributable to Gannett $13,748 Cash flow from operating activities (GAAP basis) $35,125 Loss on early
Slide 26: Gannett Same Store Non-GAAP Revenues Metrics and Reconciliations
(1) Gannett Same Store Non-GAAP Revenues Metrics and Reconciliations 2024 and 2023 Same Store Year-over-Year Revenues Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2024 Q2 2024 Same Store Year-Over-Year Total revenues (8.6)% (8.4)% (8.0)% (8.6)% (5.1)% (4.6)% 3 months ended 3 months ended 3 months ended 3 mont