E.w. Scripps Company (the) · NASDAQ:SSP
E.w. Scripps Company (the) — The E.W. Scripps Company — J.P. Morgan Leveraged Finance Conference 2024
19 slides from E.w. Scripps Company (the)'s conference presentation, Feb 26, 2024
Slide 1: JP Morgan Leveraged Finance Conference
JP MORGAN LEVERAGED FINANCE CONFERENCE FEB. 26, 2024 G I V E L I G H T A N D T H E P E O P L E W I L L F I N D T H E I R O W N W A Y
Slide 2: Safe Harbor Disclosure
S A F E H A R B O R D I S C L O S U R E This document contains certain forward-looking statements related to the company’s businesses that are based on management’s current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties, including changes in advertisi
Slide 3: Scripps' Brands Are Available on Nearly All TV Platforms to Every American
SCRIPPS’ BRANDS ARE AVAILABLE ON NEARLY ALL TV PLATFORMS TO EVERY AMERICAN 3
Slide 4: Scripps' Key Credit Highlights
SCRIPPS’ KEY CREDIT HIGHLIGHTS Largest U.S. Broadcaster by Household Reach Retransmission Revenue Visibility and Upside Significant Political Opportunity in 2024 Diversified Model Changing with the Consumer Incremental Upside with Scripps Sports Disciplined Financial Policy Experienced Management Te
Slide 5: Scripps' Recent Business Highlights
SCRIPPS’ RECENT BUSINESS HIGHLIGHTS • On July 31, we borrowed $283 million on our revolver and used the borrowings to pay down the remaining balance on our term loan B that was set to mature in October 2024. • Scripps successfully completed cable and satellite carriage agreements covering about 75%
Slide 6: First-Quarter/Full-Year 2024 Guidance
FIRST-QUARTER/FULL-YEAR 2024 GUIDANCE • 2024 presidential-year political advertising revenue: $210 million - $250 million • Local Media Q1 revenue: Up low teens percent • Core advertising: Flat-to-up low single digits • Local Media Q1 expense: Up about 10% • Scripps Networks Q1 revenue: Flat-to-down
Slide 7: Business Operations
BUSINESS OPERATIONS
Slide 8: We Anticipate Significant Adjusted EBITDA and Progress on Our Leverage Ratio in 2024
WE ANTICIPATE SIGNIFICANT ADJUSTED EBITDA AND PROGRESS ON OUR LEVERAGE RATIO IN 2024 Our five 2024 adjusted EBITDA drivers include: 1. Political: We will benefit from the high-margin political ad revenue that broadcasters get, as the primary beneficiaries of political ad spending – projected now at
Slide 9: Driver No. 1: Presidential Election Year Political Advertising Revenue
DRIVER NO.1: PRESIDENTIAL ELECTION YEAR POLITICAL ADVERTISING REVENUE 2024 Electoral College Map Projections • The spending projections for the 2024 election is at least $10 billion — up 10% from the 2020 presidential election. • Broadcasters are expected to benefit the most from the high-margin pol
Slide 10: Driver No. 2: Strong New Distribution Revenue Run Rate
DRIVER NO.2: STRONG NEW DISTRIBUTION REVENUE RUN RATE We have a robust new run rate for Local Media distribution dollars after renewing 75% of our legacy pay TV households in 2023. For 2023: • $752 million in distribution revenue • A more-than 40% increase in net distribution dollars We renew 5% of
Slide 11: Driver No. 3: Free, Over-the-Air Television Viewing Through Tablo
DRIVER NO.3: FREE, OVER-THE-AIR TELEVISION VIEWING THROUGH TABLO WE ARE EDUCATING AUDIENCES ABOUT THE APPEAL OF FREE, OVER-THE-AIR TV, MAKING IT EASIER THAN EVER FOR PEOPLE TO WATCH IT, AND FOR US TO PROFIT FROM IT. 26% 39 million Broadband-only Scripps’ share of households over-the-air viewing 40 m
Slide 12: Driver No. 4: Connected TV Distribution, Especially on FAST Services
DRIVER NO.4: CONNECTED TV DISTRIBUTION, ESPECIALLY ON FAST SERVICES WE PROJECT 40% YEAR-OVER-YEAR GROWTH IN OUR SCRIPPS NETWORKS’ 2024 CONNECTED TV ADVERTISING REVENUE, ON A BASE OF NEARLY $100 MILLION IN 2023. PLUS YouTubeTV Samsung TV Plus Vizio WatchFree+ Roku
Slide 13: Driver No. 5: Distributing Live Sports on Our Local Stations and ION
DRIVER NO.5: DISTRIBUTING LIVE SPORTS ON OUR LOCAL STATIONS AND ION LOCAL SPORTS IS A KEY DRIVER FOR LOCAL CORE AND DISTRIBUTION REVENUE. The WNBA Friday Night Spotlight on ION: Expanded the league’s audience National Reach by 24% with ION in 2023 The National Women’s Soccer League: Saturday Night f
Slide 14: Debt Position
DEBT POSITION
Slide 15: Scripps Leads Peer Group in Debt Repayment
SCRIPPS LEADS PEER GROUP IN DEBT REPAYMENT TV PEERS DISCRETIONARY CAPITAL ALLOCATION ANALYSIS SINCE THE ION ACQUISITION Debt Paydown M&A All Other Uses $834 $492 $176 $684 $300 7% 25% 21% 46% 1% 6% Scripps leads TV peers with $834 million in 2% discretionary debt repayment following 98% 89% the ION
Slide 16: Capital Structure and Financial Policy
CAPITAL STRUCTURE AND FINANCIAL POLICY Capital Structure Maturity Profile (3) ($ millions) Revolver Commit. Loans $729 Bonds $585 $551 $523 $426 $392 2024 2025 2026 2027 2028 2029 2030 2031 Key Metrics Financial Policy 6.8% ‒ Target mid ~3.0x 4.1x 5.7x Leverage Weighted Average ‒ Deleverage via exce
Slide 17: Questions + Discussion
QUESTIONS + DISCUSSION
Slide 18: Appendix: GAAP Reconciliation
APPENDIX: GAAP RECONCILIATION
Slide 19: Non-GAAP Information
NON-GAAP INFORMATION In addition to results prepared in accordance with GAAP, the company discusses free cash flow, a non-GAAP performance measure that management and the company’s Board of Directors uses to evaluate the performance of the business. We also believe that the non-GAAP measure provides
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