Usa Today Co., Inc. · NYSE:TDAY
Usa Today — Gannett — Q3 2022 Earnings Presentation
37 slides from Usa Today's earnings presentation, Nov 3, 2022
Slide 1: Q3 2022 Earnings
GANNETT Q3 2022 Earnings November 3, 2022
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 operates a scalable, data-driven digital media platform
Gannett operates a scalable, data-driven digital media platform that is fully aligned with consumer and digital marketing trends. We are a subscription-led and digitally-focused media and marketing solutions company that is committed to empowering communities to thrive. Our strategy is focused on dr
Slide 4: Key Stats and Value Drivers
NooeeNs Key Stats and Value Drivers Executing on Growth Segments and Investment Strategy in Q3 2022 and Subsequent Events” Accelerate digital-only Drive Digital Marketing Value Drivers subscriber growth Solutions (DMS) growth 1.98M $118.7M $24.3M Quarter End Digital-Only DMS Core Platform Revenues”
Slide 5: Q3 2022 Results and Non-GAAP Highlights
Q3 2022 Results and Non-GAAP Highlights™ GAAP Results Non-GAAP Results o $717.9M Total Operating Revenues o $51.9M Adjusted EBITDA © Same store revenues’ decreased 9.0% compared to the same o Adjusted EBITDA declines of 49.1% year-over-year due to period in the prior year continued headwinds in digi
Slide 6: Balance Sheet and Liquidity
pee Balance Sheet and Liquidity Q3 2022 Significant Debt Repayment $1,759M, $1,575M, $1,369M $1,371M $1,344M $1,319M YE 2019 YE 2020 YE 2021 Q1 2022 Q2 2022 Q3 2022 Acquisition Term Loan ™ New Senior Secured Term Loan ™ 2026 Senior Notes 2027 Notes” ™ 2024 Notes Net leverage ratio is calculated by s
Slide 7: Business Outlook
os Business Outlook The Company Reiterates its Full Year Outlook Guidance Previous Guidance Revenues No Change $2.95B to $3.0B Same store total revenues year-over-year (non-GAAP) (24°) No Change (7% to 6%) Net income (loss) attributable to Gannett No Change ($70M to $60M) Cash provided by operating
Slide 8: Key Operating Pillars
Key Operating Pillars Third Quarter 2022 Update
Slide 9: Key Operating Pillars
Accelerate digital subscriber growth 2025 outlook of 6 million digital-only subscriptions, inclusive of new offerings tailored to specific users Anchored on high- quality, original, impactful journalism and premium content experiences Key Operating Pillars Strong Opportunity for Creating Stakeholder
Slide 10: Strategic Reorganization
BeN Strategic Reorganization Gannett Gannett’s two distinct business units align well with our strategic pillars and are consistent with our long- term transformation to a subscription-led and digitally-focused media and marketing solutions company Gannett results include a Corporate and other categ
Slide 11: Gannett Media
Gannett Media
Slide 12: Pillar One: Accelerating Digital Subscriptions
Pillar One: Accelerating Digital Subscriptions Driving growth through trusted and unbiased content, data analytics, and improved product experience Digital-only Subscription Growth Key Pillars for Growth in 2022 1.78M 1.87M 198M 15am 163M : Personalized Premium Content tam 122M 1.38M l | Optimize Su
Slide 13: Expanding TAM: Partnerships/Bundles
Expanding TAM: Partnerships/Bundles Collaborating with Partners With Complementing Product Portfolio and Audience Alignment The pate tal hy nextdoor = USATODAY. azing mr Neighbors Bundle & Save Mt» MCCLATCHY |
Slide 14: Pillar One: Accelerating Digital Subscriptions
Pillar One: Accelerating Digital Subscriptions Driving growth through trusted and unbiased content, data analytics, and improved product experience Digital-Only ARPU” Digital-Only Sequential Net Adds” $5.87 $5.93 164K - i I : 321 aa2r iz 222 3 2022 9321 421 122 222 @3 2022 1. ARPU is calculated by d
Slide 15: Pillar One: Accelerating Digital Subscriptions
Pillar One: Accelerating Digital Subscriptions Registered Users” and Newsletter Subscribers” See Impressive Growth Rates +49% +30% Annual growth of Annual growth of total registered users” newsletter subscribers” from 3.7M to 5.4M from 6.4M to 8.3M® at the end of Q3 2022. at the end of Q3 2022. Why
Slide 16: Digital Marketing Solutions
Digital Marketing Solutions
Slide 17: Pillar Two: Driving DMS Growth
Pillar Two: Driving DMS Growth Digital Marketing Solutions — Driving Growth and Further Value for our Shareholders Our DMS business is focused on: Helping SMBs (1) Build their online presence, (2) Drive awareness & leads, (3) Manage & nurture leads and (4) Measure what works. While growing a predict
Slide 18: Pillar Two: Driving DMS Growth
Pillar Two: Driving DMS Growth Digital Marketing Solutions - Core Platform” Revenues (M)” Customer Count (K)” 15.3 15.4 15.2 15.4 16.2 158 15.4 $118.7 $104,781127 $110.1s107.3 ye 13.3, 13.6 ill [ [ [ [ [ [ 320 420 121 Q221 321 Q421 Q122 G222 G322 320 420 121 G221 G321 G421 Q122 @222 a322 Q3 2022 - 5
Slide 19: Pillar Two: Driving DMS Growth
pene Pillar Two: Driving DMS Growth Digital Marketing Solutions Revenues Digital Marketing Solutions Customer Count (K)” Core system integration / product alignment 8 aaa $118.0 $120.0 wy 107. 110, $107-3 sto2.3 § 20 s109.7 8 20.2 20.0 18.3 7 472 16.5 15.9 | - ; ; ; Q420 Q121 221321421122 222322 Q42
Slide 20: Appendix
Appendix
Slide 21: Gannett Diversified Revenues
Gannett Diversified Revenues (iomtinn cone 0 Print Advertising Revenues’) $159.3 22.2% Digital Marketing Services $119.7 16.7% Digital Media $67.9 9.5% Digital Classified $14.9 2.1% ree Advertising and Marketing Services $202.5 28.2% Digital-only Circulation $34.5 48% Print Circulation $230.2 32.1%
Slide 22: Debt and Leverage Overview
PoaED Debt and Leverage Overview Balance as of September 30, ($ in millions) 2022 2024 Notes 4.75% $3.3 2027 Notes 6.0% $485.3 New Senior Secured Term Loan) 7.57%) $467.9 2026 Senior Notes 6.0% $363.0 Total Debt Outstanding 6.55% Blended Rate $1,319. Q3 2022 LTM Adjusted EBITDA®) $282.3 Cash on the
Slide 23: Non-GAAP Reconciliation
Non-GAAP Reconciliation ‘The Company uses non-GAAP financial performance and liquidity measures to supplement the financial information presented on a US. GAAP basis. These non-GAAP financial measures, which may not be comparableto similarly titled measures reportedby other companies, shouldnot be c
Slide 24: Same Store Year-over-Year Revenues Metrics
1 Same Store Year-over-Year Revenues Metrics“ FY Qi 2019 2020 Print Advertising 17.6% — -21.1% Digital Advertising and 28% 2.1% Marketing Services Advertising and Marketing 4 GPuES Services Circulation “6.7% -7.5% Other 1.9% — -9.0% Total Gannett “8.9% -10.0% Q2 2020 45% -26.2% -37.4% -13.6% -31.5%
Slide 25: Gannett Same Store Non-GAAP Revenues Recon
1 Gannett Same Store Non-GAAP Revenues Recon Total Revenues ation” (in thousands) 3 months ended 3 months ended $ % September 30, 2022 September 30,2021 Variance Variance Total Revenues $717,902 $800,185 ($82,283) -10.3% Acquired revenues (12,358) - Currency impact 8,553 - Exited operations - (15,77
Slide 26: Gannett Same Store Non-GAAP Revenues Reconciliation
1 Gannett Same Store Non-GAAP Revenues Reconciliation™ Total Digital Revenues 3 months ended 3 months ended SVETEWED % September 30, 2022 September 30, 2021 Variance (in thousands) Total Digital Revenues $256,434 $264,983 ($8,549) -3.2% Acquired revenues (2,037) - Currency impact 3,377 - Exited oper
Slide 27: Gannett Same Store Non-GAAP Revenues Reconciliation
1 Gannett Same Store Non-GAAP Revenues Reconciliation™ Total Gannett Media Segment 3 months ended 3 months ended : vv September 30,2022 September 30,2021 * Variance = % Variance (in thousands) Total Revenues $633,006 $715,807 ($82,801) -11.6% Acquired revenues (12,358) - Currency impact 7,895 - Exit
Slide 28: Gannett Non-GAAP Reconciliation
Gannett Non-GAAP Recon tion™ Adjusted EBITDA Total Company Digital Marketing Solutions Segment (@otdnmac) september 30,2022 (in thousands) september 30,2022 Net loss attributable to Gannett ($54,114) Net income attributable to Gannett $5,385 Provision for income taxes 18,098 Depreciation and amortiz
Slide 29: Gannett Non-GAAP Reconciliation
Gannett Non-GAAP Reconciliation” LTM Adjusted EBITDA Gannett Media Unit Digital Marketing Solutions Unit LTM ended , LTM ended (in thousands) September 30, 20: (in thousands) September} 30, 1022 Net income attributable to Gannett $161,040 Net income attributable to Gannett $22,400 Non-operating pens
Slide 30: Gannett Non-GAAP Reconciliation
Gannett Non-GAAP Recon tion™ LTM Adjusted EBITDA Corporate and Other (in thousands) emrein one 2022 Net loss attributable to Gannett ($316,657) Provision for income taxes 69,332 Interest expense 106,218 Loss on early extinguishment of debt 24,976 Depreciation and amortization 17,304 Integration and
Slide 31: Gannett Non-GAAP Reconciliation
Gannett Non-GAAP Reconciliation Adjusted Net Income attributable to Gannett and Free cash flow (ncaa september 30,2022 (neha september 30,2022 Net loss attributable to Gannett ($54,114) Cash provided by operating activities (GAAP basis) $31,294 Gain on early extinguishment of debt (1,228) Capital ex
Slide 32: Gannett Same Store Non-GAAP Revenues Reconciliation
1 Gannett Same Store Non-GAAP Revenues Reconciliation™ Gannett Media Segment — Digital Advertising and Marking Services 3monthsended = 3 months ended % Variance (in thousands) September 30, September 30, $ Variance 2022 2021 Digital Media Revenues $67,886 $91,344 ($23,458) Acquired revenues (833) -
Slide 33: Gannett Same Store Non-GAAP Revenues Reconciliation
Gannett Same Store Non-GAAP Revenues Reconciliation” Gannett Media Segment — Advertising and Marketing Services 3 months ended 3 months ended (in thousands) September 30, September 30, $Variance % Variance 2022 2021 Print Advertising Revenues $159,324 $190,044 ($30,720) -16.2% Acquired revenues (5,8
Slide 34: Gannett Same Store Non-GAAP Revenues Reconciliation
Gannett Same Store Non-GAAP Revenues Reconciliation Gannett Media Segment - Circulation 3 months ended 3 months ended (in thousands) September 30, September 30, $ Variance % Variance 2022 2021 Print Circulation Revenues $230,200 $280,980 ($50,780) 718.1% Acquired revenues (3,657) - Currency impact 2
Slide 35: Gannett Same Store Non-GAAP Revenues Reconciliation
Gannett Same Store Non-GAAP Revenues Reconciliation @) Business Outlook?) 12 months ended 12 months ended December 31, 2021 (Est.) December 31, 2022 (Est.) Total Revenues $3,208M $2,950M to $3,000M Acquired revenues - ($45M - $40M) Currency impact - $20M to $25M Exited operations ($60M to $55M)) - ‘
Slide 36: Gannett Non-GAAP Reconciliation - Business Outlook
Gannett Non-GAAP Reconciliation - Business Outlook”) Adjusted EBITDA and Adjusted Net income (loss) attributable to Gannett 12 months ended December 31, 2022 (Est.) Net loss attributable to Gannett ($70M to $60M) Provision for income taxes $20M to $25M Interest expense $105M to $110M Non-operating p
Slide 37: Gannett Non-GAAP Reconciliation - Business Outlook
2. Gannett Non-GAAP Reconciliation — Business Outlook" Free Cash Flow 12 months ended December 31, 2022 (Est.) Cash provided by operating activities (GAAP basis) $45M to $65M. Capital Expenditures ~$45M Free cash flow (non-GAAP basis) $0M to $20M Projections are based on Company estimates as of Nove