Usa Today Co., Inc. · NYSE:TDAY
Usa Today — Gannett — Q1 2023 Earnings Presentation
34 slides from Usa Today's earnings presentation, May 4, 2023
Slide 1: Gannett Q1 2023 Earnings
GANNETT Q1 2023 Earnings May 4, 2023
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 aligns 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 driving audi
Slide 4: Key Stats and Value Drivers
Key Stats and Value Drivers Executed on Growth Segments and Investment Strategy in Q1 2023 Drive Digital Subscription Drive Digital Marketing Value Drivers Growth Solutions (DMS) Growth 2.02M $111.4M $37.3M Digital-only Paid Subscriptions DMS Core Platform Revenues” Total Debt Paydown ti 5.4% Year-o
Slide 5: Q1 2023 Results and Non-GAAP Highlights
Q1 2023 Results and Non-GAAP Highlights™ Revenues © $668.9M Total Operating Revenues o $62.9M Adjusted EBITDA o Same store revenues) decreased 9.3% compared to the same o Adjusted EBITDA down $1.3 million compared to the prior year period in the prior year, improving 100 basis points compared quarte
Slide 6: Balance Sheet and Liquidity
ae Balance Sheet and Liquidity Q1 2023 Significant Debt Repayment $1,759M, $1,575M. $1,369M, $1,272M $1,235M, YE 2019 YE 2020 YE 2021 YE 2022 Q1 2023 Acquisition Term Loan ™Senior Secured Term Loan (due 2026) 2026 Senior Notes 2027 Notes ™ 2024 Notes Net leverage ratio is calculated by subtracting c
Slide 7: Business Outlook
open Business Outlook™ The Company Raises its Full Year 2023 Outlook Full Year 2023 Outlook Revenues $2.75B to $2.80B Same store total revenues year-over-year (non-GAAP))4)®) (5% to 3%) Net income (loss) attributable to Gannett ($15M) to $15M Cash provided by operating activities $125M to $145M Free
Slide 8: Key Operating Pillars
Key Operating Pillars First Quarter 2023 Update
Slide 9: Key Operating Pillars
Drive digital subscription growth Key Operating Pillars Strong opportunities for creating stakeholder value ° = €& Drive Digital Optimize our Prioritize Marketing legacy circulation investments Solutions and advertising in growth (DMS) growth businesses businesses Build ESG efforts, including ID&E,
Slide 10: Gannett's Operating Segments
Gannett’s Operating Segments Our two distinct reportable segments 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’s top fiscal priorities: Revenue, Adjusted EBITDA, a
Slide 11: Gannett Media
Gannett Media
Slide 12: Pillar One: Drive Digital Subscription Growth
Pillar One: Drive Digital Subscription Growth Driving growth through trusted and unbiased content, data analytics, and improved product experience Digital-only Subscription Growth Digital-only Circulation Revenue Growth 2.03M 2.02M $34.5M —-_$35.5M - ’ ) i; i ; j ’ i i Q122 Q222 Q3 22 Q422 Q123 Q122
Slide 13: Registered Users and Newsletter Subscribers See Impressive Growth Rates
ARN = Pillar One: Drive Digital Subscriptions Growth Registered Users” and Newsletter Subscribers” See Impressive Growth Rates +63% +16% Annual growth of Annual growth of total registered users” total newsletter subscribers” to 6.5M at the end of Q1 2023 to 8.7M” at the end of Q1 2023 from 4.0M at t
Slide 14: Digital Marketing Solutions
Digital Marketing Solutions
Slide 15: Pillar Two: Drive DMS Growth
Pillar Two: Drive 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 predictab
Slide 16: Digital Marketing Solutions - Core Platform
aeys Pillar Two: Drive DMS Growth Digital Marketing Solutions - Core Platform” Revenues (M)” Customer Count (K)” 153 154 452 154 162 158 yo, 14) 118.7 $119.7 $104,751!275110.1§107,3 $116.45" $ $1114 13.6 TTT [ [ Q121 221 321 421 Q122 Q222 G322 Q422 G123 @121 221 321 Q421 Q122 G222 @322 Q422 Q123 Q1
Slide 17: Appendix
Appendix
Slide 18: Gannett Diversified Revenues
Gannett Diversified Revenues 012023 sof rota Print Advertising Revenues $148.0 22.1% Digital Marketing Services $112.7 16.8% Digital Media $66.1 9.9% Digital Classified $14.1 2.1% relict Advertising and Marketing Services $192.9 28.8% Digital-only Circulation $35.8 5.4% Print Circulation $205.5 30.7
Slide 19: Debt and Leverage Overview
paReN Debt and Leverage Overview Balance as of March 31, 2023 2024 Notes 4.75% $3.3 2027 Notes 6.0% $485.3 Senior Secured Term Loan (due 2026)”) 9.73%!) $407.1 2026 Senior Notes 6.0% $339.1 Total Debt Outstanding 7.23% Blended Rate $1,234.8 Q1 2023 LTM Adjusted EBITDA®) $256.0 Cash on the Balance Sh
Slide 20: Same Store Year-over-Year Revenues Metrics
Same Store Year-over-Year Revenues Metrics“ FY 2021 Q1 2022 Q3 202: Q4 202: FY 2022 Q1 20: Print Advertising 8.9% -7.0% -11.3% -12.1% -16.8% -11.9% -10.7% Digital Advertising and Marketing Services 7.1% 4.4% -3.5% -7.8% -4,.3% -3.0% -3.7% Advertising and Marketing Services -1.2% -1.2% -7.1% -9.7% -1
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 US. GAAP basis, These non-GAAP financial measures, which may not be comparableto similarly titled measures reportedby other companies, shouldnot be c
Slide 22: Gannett Same Store Non-GAAP Revenues Reconciliation
Gannett Same Store Non-GAAP Revenues Recon tion™ Total Digital and Digital-only Circulation Revenues (in thousands) 3 months ended 3 months ended eAvariancel % March 31, 2023 March 31, 2022 Variance Total Digital Revenues $247,478 $251,144 ($3,666) -1.5% Acquired revenues (1,927) - Currency impact 2
Slide 23: Gannett Non-GAAP Reconciliation: Adjusted EBITDA
tion™ Gannett Non-GAAP Recon Adjusted EBITDA Total Company Total Company 3 months ended March 31, 2022 3 months ended March 31, 2023 (in thousands) (in thousands) Net income attributable to Gannett $10,344 Net loss attributable to Gannett ($2,967) Benefit for income taxes (17,329) Benefit for income
Slide 24: Gannett Non-GAAP Reconciliation: DMS Segment Adjusted EBITDA
Gannett Non-GAAP Recon tion™ Adjusted EBITDA Digital Marketing Solutions Segment Digital Marketing Solutions Segment 3 months ended March 31, 2022 3 months ended March 31, 2023 (neers) (in thousands) Net income attributable to Gannett $5,623 Net income attributable to Gannett $5,257 Depreciation and
Slide 25: Gannett Non-GAAP Reconciliation: LTM Adjusted EBITDA
Gannett Media Segment ( thousands) Net income attributable to Gannett Non-operating pension income Depreciation and amortization Integration and reorganization costs Other operating expenses Asset impairments Gain on sale or disposal of assets, net Other items Adjusted EBITDA (non-GAAP basis) Net in
Slide 26: Gannett Non-GAAP Reconciliation: LTM Corporate and Other
Gannett Non-GAAP Recon tion™ LTM Adjusted EBITDA Corporate and Other (in thousands) LTM ended March 31, 2023 Net loss attributable to Gannett ($196,715) Benefit for income taxes (8,373) Interest expense 110,690 Gain on early extinguishment of debt (3,638) Depreciation and amortization 18,095 Integra
Slide 27: Adjusted Net Income and Free Cash Flow Reconciliation
Gannett Non-GAAP Reconciliation Adjusted Net Income attributable to Gannett and Free Cash Flow thousands) Net income attributable to Gannett Gain on early extinguishment of debt Integration and reorganization costs Other operating expenses Asset impairments Gain on sale or disposal of assets, net Ot
Slide 28: Gannett Same Store Non-GAAP Revenues Reconciliation
a Gannett Same Store Non-GAAP Revenues Reconciliation™ Same store revenues is a non-GAAP performance measure based on U.’ Q1 2023 Same Store Year-over-Year Revenues Metrics (in thousands) Print Advertising Revenues ‘Acquired revenues ‘Currency impact Exited operations ‘Same Store Revenues, Total Pri
Slide 29: (in thousands)
1 (in thousands) Print Advertising Revenues ‘Acquired revenues Currency impact Exited operations ‘Same Store Revenues, Total Print Advertising Digital Advertising and Marketing Services Revenues Acquired revenues Currency impact Exited operations ‘Same Store Revenues, Total Digital Advertising ‘and
Slide 30: Gannett Same Store Non-GAAP Revenues Reconciliation
a Gannett Same Store Non-GAAP Revenues Reconciliation™ Q4 2022 and Q3 2022 Same Store Year-over-Year Revenues Metrics 3 months ended September 30, 2 (in thousands) $ Variance ce (in thousands) Print Advertising Revenues ‘Acquired revenues Currency impact Exited operations ‘Same Store Revenues, Total
Slide 31: Gannett Same Store Non-GAAP Revenues Reconciliation
a Gannett Same Store Non-GAAP Revenues Reconciliation™ Q2 2022 and Q1 2022 Same Store Year-over-Year Revenues Metrics (in thousands) (in thousands) 1 Variance % Variance Print Advertising Revenues ‘Acquired revenues ‘Currency impact Exited operations ‘Same Store Revenues, Total Print Advertising Dig
Slide 32: Same Store Revenues Reconciliation - Business Outlook
Gannett Same Store Non-GAAP Revenues Reconciliation’ @) Business Outlook(?) 12 months ended December 31, 2022 (Est.) 12 months ended December 31, 2023 (Est.) Total Revenues Acquired revenues Currency impact Exited operations Same Store Revenues, Total ($46M) $2.90B $2.75B to $2.80B ~($10M) ~$10M $2.
Slide 33: Non-GAAP Reconciliation - Business Outlook
eae . 1)(2) Gannett Non-GAAP Reconciliation - Business Outlook” Adjusted EBITDA and Adjusted Net income (loss) attributable to Gannett 12 months ended December 31, 2023 (Est.) Net income (loss) attributable to Gannett ($15M) to $15M Provision for income taxes $0M to $20M Interest expense $100M to $1
Slide 34: Non-GAAP Reconciliation - Business Outlook: Free Cash Flow
1 2. KM) Gannett Non-GAAP Reconciliation - Business Outloo! Free Cash Flow 12 months ended December 31, 2023 (Est.) Cash provided by operating activities (GAAP basis) $125M to $145M Capital Expenditures ~$40M Free cash flow (non-GAAP basis) $85M to $105M Projections are based on Company estimates as