Gannett Co., Inc. (“Gannett”, “we”, “us”, “our”, or “the Company”) (NYSE: GCI) today reported its financial results for the second quarter ended June 30, 2020. Prior to November 19, 2019, our corporate name was New Media Investment Group Inc. (“New Media” or “Legacy New Media”), and Gannett Co., Inc. (“Legacy Gannett”) was a separate publicly traded company. On November 19, 2019, New Media acquired Legacy Gannett (the “Acquisition”). In connection with the Acquisition, Legacy Gannett became a wholly owned subsidiary of New Media, and New Media changed its name to Gannett Co., Inc.
“While the second quarter was significantly impacted by the COVID-19 pandemic, our revenue was in line with the guidance we shared on our last earnings call and our EBITDA performance benefited from our expense reduction efforts,” said Michael Reed, Gannett Chairman and Chief Executive Officer. “We saw sequential improvement to revenue each month during the quarter and successfully realized over $125 million of incremental expense savings during the quarter. In addition, we continued to execute on our operating and integration plans from the Acquisition, with over $160 million of cumulative annualized synergies implemented by the end of the quarter. Combining our incremental expense savings, our synergy implementation, and the normal course expense savings that rolled forward from the first quarter, our operating expenses included in Adjusted EBITDA were down 26%.”
“At no time in our history has the value of high-quality journalism been as clear as it is right now at this intersection of a global pandemic and a nation in turmoil over systemic racism and inequality. Our journalists have worked tirelessly and doggedly to help keep our communities safe and informed, while exercising the crucial role of holding officials accountable. As digital, social platforms are overtaken by the spread of misinformation, our readers trust us to clear through the noise with credible, fact-based, fair reporting. And that is evidenced by audiences turning to us in record numbers since the beginning of the pandemic and very strong digital subscription growth. Our employees have been phenomenal, performing during these challenging times at the highest level, which is a testament to their commitment to our mission and our communities. We do not have certainty around how the pandemic will continue to affect our country and the economy, but we remain highly confident in our ability to continue to execute upon our operational and integration plans.”
Second Quarter 2020 Consolidated Results
• Second quarter revenues of $767.0 million rose 89.7% as compared to the prior year, reflecting the Acquisition.
◦ Same store pro forma revenues (as defined and reconciled below) decreased 28.0%, due to unfavorable impacts resulting from the COVID-19 pandemic and general trends adversely impacting the publishing industry.
• Digital advertising and marketing services revenues were $168.8 million in the second quarter, or 22.0% of total revenues.
• Over $160 million in annualized synergy measures were implemented by the end of the second quarter, with approximately $41.2 million in savings recognized in the quarter.
• On a pro forma basis, operating expenses included in Adjusted EBITDA were down 26.3% to the prior year quarter due to the implementations of synergies, incremental cost measures in response to the COVID-19 pandemic, and normal course expense savings that rolled forward from the first quarter.
• Non-cash goodwill and intangible impairment of $393.4 million was recognized in the second quarter of 2020 in connection with the Company’s annual impairment testing. The non-cash charge was driven by the COVID-19 pandemic and the uncertainty the crisis has created.
• GAAP net loss attributable to Gannett of $436.9 million in the second quarter reflects $393.4 million of non-cash goodwill and intangible impairment and $66.3 million of depreciation and amortization.
• Adjusted EBITDA totaled $78.0 million. Margins in the quarter were 10.2%, despite the pressures from the COVID-19 pandemic.
more detail at: https://s1.q4cdn.com/307481213/files/doc_financials/2020/q2/GCI-Q2-2020-EX-99.1-Earnings-Release-vFINAL.pdf