TEGNA Inc. Reports a 28 Percent Increase in 2015 Third Quarter Non-GAAP Earnings per Share from Continuing Operations and a 22 Percent Increase in Adjusted EBITDA
Highlights for the quarter include the following:
-
Earnings from continuing operations of
$0.37 per diluted share on a non-GAAP basis, a 28 percent year-over-year increase driven by strong Digital Segment results - Overall company revenue growth of 19 percent, also driven by strong Digital Segment results and despite the absence of significant political spending in the same quarter last year
- Digital Segment revenue increased 72 percent due to the acquisition of and substantially better results at Cars.com
-
Adjusted EBITDA totaled
$267 million , a 22 percent year-over-year increase
The results for the third quarter of 2015 and the year-to-date periods
include results for Cars.com, which we acquired on
On the first day of our fiscal third quarter, we completed the spin-off of our publishing businesses. The publishing businesses are now reflected as Discontinued Operations in our Statements of Income.
On
CONTINUING OPERATIONS
Company-wide operating revenues in the third quarter totaled
Net income from continuing operations attributable to
Operating income totaled
Special items in the third quarter of 2015 primarily included a
spin-related tax credit of
Operating expenses were
Corporate expenses for the third quarter of 2015 were
TEGNA MEDIA
Broadcasting Segment revenues totaled
The following table summarizes the year-over-year changes in select Broadcasting Segment revenue categories.
Broadcasting Revenue Detail (Dollars in thousands) |
||||||
Thirteen
weeks ended Sep. 27, 2015 |
Percentage change
from thirteen weeks ended Sep. 28, 2014 |
|||||
Core (Local & National) | $ | 254,243 | 1 | % | ||
Political | 6,061 | (85 | %) | |||
Retransmission (a) | 109,012 | 19 | % | |||
Digital | 29,415 | 13 | % | |||
Other | 7,714 | (3 | %) | |||
Total | $ | 406,445 | (2 | %) | ||
(a) Reverse compensation to networks is included as part of programming costs and therefore not included in this line. | ||||||
Core advertising was up just over 1 percent in the quarter.
Retransmission revenues totaled
Media Segment operating expenses were
Based on current trends, we expect to see growth in core advertising in
the fourth quarter. However, the fourth quarter of 2014 benefited from a
record
DIGITAL
Digital Segment operating revenues of
Revenue growth at Cars.com reflects continued growth across all sales channels. Direct sales, on a pro forma basis, were up 11.4 percent reflecting an increase in revenue per dealer driven by new product sales. National revenue, primarily display advertising sold to auto manufacturers, was 13.8 percent higher due, in part, to strong growth in mobile traffic. Affiliate revenue increased 52.7 percent driven by higher wholesale rates that Cars.com charges its affiliates.
CareerBuilder revenue in the third quarter would have been up in the low-single digits excluding the impact of the strategic decision to reduce sales of certain lower margin advertising and services products to focus on more lucrative, long-term recurring software deals as well as unfavorable exchange rates. As a result, revenue from Human Capital Software Solutions was up 24.1 percent in the quarter. CareerBuilder revenue was 3.7 percent lower on a constant currency basis.
Digital Segment non-GAAP pro forma operating expenses were 1.3 percent
lower in the quarter and totaled
NON-OPERATING ITEMS
Interest expense totaled
Other non-operating expense on a non-GAAP basis in the quarter totaled
Net cash flow from operating activities was
* * * *
As previously announced, the company will hold an earnings conference
call at
About
Certain statements in this press release may be forward looking in
nature or “forward looking statements” as defined in the Private
Securities Litigation Reform Act of 1995. The forward looking statements
contained in this press release are subject to a number of risks, trends
and uncertainties that could cause actual performance to differ
materially from these forward looking statements. A number of those
risks, trends and uncertainties are discussed in the company's
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
TEGNA Inc. and Subsidiaries Unaudited, in thousands (except per share amounts) |
|||||||||||
Table No. 1 | |||||||||||
Thirteen weeks ended Sep. 27, 2015 |
Thirteen weeks ended Sep. 28, 2014 |
% Increase (Decrease) |
|||||||||
Net operating revenues: | |||||||||||
TEGNA Media | $ | 406,445 | $ | 416,509 | (2.4 | ) | |||||
TEGNA Digital | 351,072 | 204,560 | 71.6 | ||||||||
TEGNA Other | 49,569 | 59,916 | (17.3 | ) | |||||||
Total | 807,086 | 680,985 | 18.5 | ||||||||
Operating expenses: | |||||||||||
Cost of sales and operating expenses, exclusive of depreciation | 256,941 | 276,833 | (7.2 | ) | |||||||
Selling, general and administrative expenses, exclusive of depreciation | 283,564 | 186,191 | 52.3 | ||||||||
Depreciation | 21,723 | 21,294 | 2.0 | ||||||||
Amortization of intangible assets | 28,501 | 11,433 | *** | ||||||||
Facility consolidation | — | 1,230 | (100.0 | ) | |||||||
Total | 590,729 | 496,981 | 18.9 | ||||||||
Operating income | 216,357 | 184,004 | 17.6 | ||||||||
Non-operating (expense) income: | |||||||||||
Equity loss in unconsolidated investees, net | (1,013 | ) | (981 | ) | 3.3 | ||||||
Interest expense | (66,949 | ) | (65,791 | ) | 1.8 | ||||||
Other non-operating items | (3,116 | ) | (15,326 | ) | (79.7 | ) | |||||
Total | (71,078 | ) | (82,098 | ) | (13.4 | ) | |||||
Income before income taxes | 145,279 | 101,906 | 42.6 | ||||||||
Provision for income taxes | 37,178 | 29,782 | 24.8 | ||||||||
Income from continuing operations | 108,101 | 72,124 | 49.9 | ||||||||
Net income attributable to noncontrolling interests |
(17,487 |
) |
(21,476 | ) | (18.6 | ) | |||||
Net income from continuing operations attributable to TEGNA Inc. | $ | 90,614 | $ | 50,648 | 78.9 | ||||||
Earnings from continuing operations per share: | |||||||||||
Basic | $ | 0.40 | $ | 0.22 | 81.8 | ||||||
Diluted | $ | 0.39 | $ | 0.22 | 77.3 | ||||||
Weighted average number of common shares outstanding: | |||||||||||
Basic | 224,530 | 225,761 | (0.5 | ) | |||||||
Diluted | 230,078 | 232,097 | (0.9 | ) | |||||||
Dividends declared per share | $ | 0.14 | $ | 0.20 | (30.0 | ) | |||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
TEGNA Inc. and Subsidiaries Unaudited, in thousands (except per share amounts) |
|||||||||||
Table No. 1 (continued) | |||||||||||
Thirty-nine
weeks ended Sep. 27, 2015 |
Thirty-nine
weeks ended Sep. 28, 2014 |
% Increase
(Decrease) |
|||||||||
Net operating revenues: | |||||||||||
TEGNA Media | $ | 1,219,911 | $ | 1,197,035 | 1.9 | ||||||
TEGNA Digital | 1,025,770 | 587,060 | 74.7 | ||||||||
TEGNA Other | 155,556 | 185,332 | (16.1 | ) | |||||||
Total | 2,401,237 | 1,969,427 | 21.9 | ||||||||
Operating expenses: | |||||||||||
Cost of sales and operating expenses, exclusive of depreciation | 792,950 | 816,436 | (2.9 | ) | |||||||
Selling, general and administrative expenses, exclusive of depreciation | 852,853 | 559,642 | 52.4 | ||||||||
Depreciation | 71,360 | 61,141 | 16.7 | ||||||||
Amortization of intangible assets | 86,155 | 36,659 | *** | ||||||||
Facility consolidation and asset impairment charges | 23,190 | 25,802 | (10.1 | ) | |||||||
Total | 1,826,508 | 1,499,680 | 21.8 | ||||||||
Operating income | 574,729 | 469,747 | 22.3 | ||||||||
Non-operating (expense) income: | |||||||||||
Equity income (loss) in unconsolidated investees, net | (4,123 | ) | 156,792 | *** | |||||||
Interest expense | (206,871 | ) | (199,284 | ) | 3.8 | ||||||
Other non-operating items | (5,346 | ) | (39,762 | ) | (86.6 | ) | |||||
Total | (216,340 | ) | (82,254 | ) | *** | ||||||
Income before income taxes | 358,389 | 387,493 | (7.5 | ) | |||||||
Provision for income taxes | 119,157 | 145,731 | (18.2 | ) | |||||||
Income from continuing operations | 239,232 | 241,762 | (1.0 | ) | |||||||
Net income attributable to noncontrolling interests | (47,700 | ) | (49,351 | ) | (3.3 | ) | |||||
Net income from continuing operations attributable to TEGNA Inc. | $ | 191,532 | $ | 192,411 | (0.5 | ) | |||||
Earnings from continuing operations per share: | |||||||||||
Basic | $ | 0.85 | $ | 0.85 | — | ||||||
Diluted | $ | 0.83 | $ | 0.83 | — | ||||||
Weighted average number of common shares outstanding: | |||||||||||
Basic | 226,053 | 226,374 | (0.1 | ) | |||||||
Diluted | 231,310 | 232,157 | (0.4 | ) | |||||||
Dividends declared per share | $ | 0.54 | $ | 0.60 | (10.0 | ) | |||||
BUSINESS SEGMENT INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars |
|||||||||||
Table No. 2 | |||||||||||
Thirteen weeks ended Sep. 27, 2015 |
Thirteen weeks ended Sep. 28, 2014 |
% Increase
(Decrease) |
|||||||||
Net operating revenues: | |||||||||||
TEGNA Media | $ | 406,445 | $ | 416,509 | (2.4 | ) | |||||
TEGNA Digital | 351,072 | 204,560 | 71.6 | ||||||||
TEGNA Other | 49,569 | 59,916 | (17.3 | ) | |||||||
Total | $ | 807,086 | $ | 680,985 | 18.5 | ||||||
Operating income (net of depreciation, amortization and facility consolidation charges): | |||||||||||
TEGNA Media | $ | 158,595 | $ | 177,970 | (10.9 | ) | |||||
TEGNA Digital | 72,445 | 41,249 | 75.6 | ||||||||
TEGNA Other | (1,744 | ) | 1,230 | *** | |||||||
Corporate (a) | (12,939 | ) | (18,219 | ) | (29.0 | ) | |||||
Unallocated costs | — | (18,226 | ) | (100.0 | ) | ||||||
Total | $ | 216,357 | $ | 184,004 | 17.6 | ||||||
Depreciation, amortization and facility consolidation charges: | |||||||||||
TEGNA Media | $ | 18,406 | $ | 20,307 | (9.4 | ) | |||||
TEGNA Digital | 31,073 | 10,529 | *** | ||||||||
TEGNA Other | 205 | 253 | (19.0 | ) | |||||||
Corporate | 540 | 2,868 | (81.2 | ) | |||||||
Total | $ | 50,224 | $ | 33,957 | 47.9 | ||||||
Adjusted EBITDA (b): | |||||||||||
TEGNA Media | $ | 177,001 | $ | 198,397 | (10.8 | ) | |||||
TEGNA Digital | 103,518 | 51,778 | 99.9 | ||||||||
TEGNA Other | (1,539 | ) | 1,483 | *** | |||||||
Corporate | (12,399 | ) | (15,351 | ) | (19.2 | ) | |||||
Unallocated costs | — | (18,226 | ) | *** | |||||||
Total | $ | 266,581 | $ | 218,081 | 22.2 |
(a) Corporate expenses for the third quarter of 2015 were
(b) "Adjusted EBITDA" is a non-GAAP measure used by management to measure, analyze and compare the performance of its business segment operations at a more detailed level and in a meaningful and consistent manner. The definition of "Adjusted EBITDA" is provided in the section "Use of Non-GAAP Information" and Table No. 4 provides reconciliations to the most directly comparable financial measure calculated and presented in accordance with GAAP on the company's condensed consolidated statements of income.
BUSINESS SEGMENT INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars |
|||||||||||
Table No. 2 (continued) | |||||||||||
Thirty-nine
weeks ended |
Thirty-nine
weeks ended |
% Increase
(Decrease) |
|||||||||
Net operating revenues: | |||||||||||
TEGNA Media | $ | 1,219,911 | $ | 1,197,035 | 1.9 | ||||||
TEGNA Digital | 1,025,770 | 587,060 | 74.7 | ||||||||
TEGNA Other | 155,556 | 185,332 | (16.1 | ) | |||||||
Total | $ | 2,401,237 | $ | 1,969,427 | 21.9 | ||||||
Operating income (net of depreciation, amortization and facility consolidation and asset impairment charges): | |||||||||||
TEGNA Media | $ | 513,557 | $ | 503,841 | 1.9 | ||||||
TEGNA Digital | 175,462 | 89,003 | 97.1 | ||||||||
TEGNA Other | (11,000 | ) | (10,527 | ) | 4.5 | ||||||
Corporate | (50,817 | ) | (53,340 | ) | (4.7 | ) | |||||
Unallocated costs | (52,473 | ) | (59,230 | ) | (11.4 | ) | |||||
Total | $ | 574,729 | $ | 469,747 | 22.3 | ||||||
Depreciation, amortization and facility consolidation and asset impairment charges: | |||||||||||
TEGNA Media | $ | 61,492 | $ | 68,122 | (9.7 | ) | |||||
TEGNA Digital | 106,050 | 29,667 | *** | ||||||||
TEGNA Other | 6,718 | 17,134 | (60.8 | ) | |||||||
Corporate | 6,445 | 8,679 | (25.7 | ) | |||||||
Total | $ | 180,705 | $ | 123,602 | 46.2 | ||||||
Adjusted EBITDA (a): | |||||||||||
TEGNA Media | $ | 562,688 | $ | 574,344 | (2.0 | ) | |||||
TEGNA Digital | 283,679 | 118,670 | *** | ||||||||
TEGNA Other | (3,982 | ) | 6,607 | *** | |||||||
Corporate | (44,372 | ) | (44,661 | ) | (0.6 | ) | |||||
Unallocated costs | (52,473 | ) | (59,230 | ) | (11.4 | ) | |||||
Total | $ | 745,540 | $ | 595,730 | 25.1 |
(a) "Adjusted EBITDA" is a non-GAAP measure used by management to measure, analyze and compare the performance of its business segment operations at a more detailed level and in a meaningful and consistent manner. The definition of "Adjusted EBITDA" is provided in the section "Use of Non-GAAP Information" and Table No. 4 provides reconciliations to the most directly comparable financial measure calculated and presented in accordance with GAAP on the company's condensed consolidated statements of income.
USE OF NON-GAAP INFORMATION
The company uses non-GAAP financial performance and liquidity measures to supplement the financial information presented on a GAAP basis. These non-GAAP financial measures should not be considered in isolation from or as a substitute for the related GAAP measures, and should be read together with financial information presented on a GAAP basis.
The company discusses in this report non-GAAP financial performance measures that exclude from its reported GAAP results the impact of special items consisting of workforce restructuring charges, transformation items, non-cash asset impairment charges, certain gains and expenses recognized in non-operating categories and charges to its income tax provision. The company believes that such expenses, charges and gains are not indicative of normal, ongoing operations and their inclusion in results makes for more difficult comparisons between years and with peer group companies.
The company also discusses Adjusted EBITDA, a non-GAAP financial performance measure that it believes offers a useful view of the overall operation of its businesses. Adjusted EBITDA is defined as net income from continuing operations attributable to Parent before (1) net income attributable to noncontrolling interests, (2) income taxes, (3) interest expense, (4) equity income (losses), (5) other non-operating items, (6) workforce restructuring, (7) other transformation items, (8) asset impairment charges, (9) depreciation and (10) amortization. When Adjusted EBITDA is discussed in reference to performance on a consolidated basis, the most directly comparable GAAP financial measure is Net income from continuing operations attributable to Parent. Management does not analyze non-operating items such as interest expense and income taxes on a segment level; therefore, the most directly comparable GAAP financial measure to Adjusted EBITDA when performance is discussed on a segment level is Operating income. This earnings report also discusses free cash flow, a non-GAAP liquidity measure. Free cash flow is defined as “net cash flow from operating activities” as reported on the statement of cash flows reduced by “purchase of property, plant and equipment” and increased by voluntary pension contributions, net of related tax benefit. The company believes that free cash flow is a useful measure for management and investors to evaluate the level of cash generated by operations and the ability of its operations to fund investments in new and existing businesses, return cash to shareholders under the company’s capital program, repay indebtedness, add to the company’s cash balance, or use in other discretionary activities. Management uses free cash flow to monitor cash available for repayment of indebtedness and in its discussions with the investment community.
Management uses non-GAAP financial performance measures for purposes of evaluating business unit and consolidated company performance. The company therefore believes that each of the non-GAAP measures presented provides useful information to investors by allowing them to view the company’s businesses through the eyes of management and the Board of Directors, facilitating comparison of results across historical periods and providing a focus on the underlying ongoing operating performance of its businesses. In addition, many of the company’s peer group companies present similar non-GAAP measures so the presentation of such measures facilitates industry comparisons. Tabular reconciliations for the non-GAAP financial measures are contained in Tables 3 through 8 attached to this news release.
NON-GAAP FINANCIAL INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars (except per share amounts) |
||||||||||||||||||||||||
Table No. 3 | ||||||||||||||||||||||||
Reconciliations of certain line items impacted by special items to the most directly comparable financial measure calculated and presented in accordance with GAAP on the company's condensed consolidated statements of income follow: |
||||||||||||||||||||||||
GAAP
Measure |
Non-GAAP
Measure |
|||||||||||||||||||||||
Thirteen
weeks ended Sep. 27, 2015 |
Special tax |
Thirteen weeks ended Sep. 27, 2015 |
||||||||||||||||||||||
Income before income taxes | $ | 145,279 | $ | — | $ | 145,279 | ||||||||||||||||||
Provision for income taxes | 37,178 | 6,016 | 43,194 | |||||||||||||||||||||
Net income from continuing operations attributable to TEGNA | 90,614 | (6,016 | ) | 84,598 | ||||||||||||||||||||
Income from continuing operations per share - diluted | $ | 0.39 | $ | (0.02 | ) | $ | 0.37 | |||||||||||||||||
GAAP
Measure |
Special Items |
Non-GAAP
Measure |
||||||||||||||||||||||
Thirteen
weeks ended Sep. 28, 2014 |
Workforce restructuring |
Other |
Non- |
Special tax |
Thirteen weeks ended Sep. 28, 2014 |
|||||||||||||||||||
Cost of sales and operating expenses, exclusive of depreciation | $ | 276,833 | $ | (102 | ) | $ | — | $ | — | $ | — | $ | 276,731 | |||||||||||
Selling, general and administrative expenses, exclusive of depreciation | 186,191 | (18 | ) | — | — | — | 186,173 | |||||||||||||||||
Facility consolidation charges | 1,230 | — | (1,230 | ) | — | — | — | |||||||||||||||||
Operating expenses | 496,981 | (120 | ) | (1,230 | ) | — | — | 495,631 | ||||||||||||||||
Operating income | 184,004 | 120 | 1,230 | — | — | 185,354 | ||||||||||||||||||
Equity income (loss) in unconsolidated investees, net | (981 | ) | — | — | 5,987 | — | 5,006 | |||||||||||||||||
Other non-operating items | (15,326 | ) | — | — | 14,491 | — | (835 | ) | ||||||||||||||||
Total non-operating (expense) income | (82,098 | ) | — | — | 20,478 | — | (61,620 | ) | ||||||||||||||||
Income before income taxes | 101,906 | 120 | 1,230 | 20,478 | — | 123,734 | ||||||||||||||||||
Provision for income taxes | 29,782 | 44 | 458 | 4,074 | (279 | ) | 34,079 | |||||||||||||||||
Net income from continuing operations attributable to TEGNA | 50,648 | 76 | 772 | 16,404 | 279 | 68,179 | ||||||||||||||||||
Income from continuing operations per share - diluted | $ | 0.22 | $ | — | $ | — | $ | 0.07 | $ | — | $ | 0.29 | ||||||||||||
NON-GAAP FINANCIAL INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars (except per share amounts) |
||||||||||||||||||||||||||||
Table No. 3 (continued) | ||||||||||||||||||||||||||||
GAAP
Measure |
Special Items | Non-GAAP Measure | ||||||||||||||||||||||||||
Thirty-nine
weeks ended Sep. 27, 2015 |
Workforce restructuring |
Other |
Asset |
Non- |
Special tax |
Thirty-nine |
||||||||||||||||||||||
Cost of sales and operating expenses, exclusive of depreciation | $ | 792,950 | $ | (2,729 | ) | $ | 12,709 | $ | — | $ | — | $ | — | $ | 802,930 | |||||||||||||
Selling, general and administrative expenses, exclusive of depreciation | 852,853 | (86 | ) | — | — | — | — | 852,767 | ||||||||||||||||||||
Facility consolidation and asset impairment charges | 23,190 | — | (16,350 | ) | (6,840 | ) | — | — | — | |||||||||||||||||||
Operating expenses | 1,826,508 | (2,815 | ) | (3,641 | ) | (6,840 | ) | — | — | 1,813,212 | ||||||||||||||||||
Operating income | 574,729 | 2,815 | 3,641 | 6,840 | — | — | 588,025 | |||||||||||||||||||||
Other non-operating items | (5,346 | ) | — | — | — | 1,453 | — | (3,893 | ) | |||||||||||||||||||
Total non-operating expense | (216,340 | ) | — | — | — | 1,453 | — | (214,887 | ) | |||||||||||||||||||
Income before income taxes | 358,389 | 2,815 | 3,641 | 6,840 | 1,453 | — | 373,138 | |||||||||||||||||||||
Provision for income taxes | 119,157 | 725 | 1,354 | 2,544 | (5,738 | ) | (805 | ) | 117,237 | |||||||||||||||||||
Net income from continuing operations attributable to TEGNA | 191,532 | 2,090 | 2,287 | 4,296 | 7,191 | 805 | 208,201 | |||||||||||||||||||||
Net income from continuing operations per share - diluted | $ | 0.83 | $ | 0.01 | $ | 0.01 | $ | 0.02 | $ | 0.03 | $ | — | $ | 0.90 | ||||||||||||||
GAAP
Measure |
Special Items | Non-GAAP Measure | ||||||||||||||||||||||||||
Thirty-nine
weeks ended Sep. 28, 2014 |
Workforce
restructuring |
Other |
Asset |
Non- |
Special tax |
Thirty-nine |
||||||||||||||||||||||
Cost of sales and operating expenses, exclusive of depreciation | $ | 816,436 | $ | (2,024 | ) | $ | — | $ | — | $ | — | $ | — | $ | 814,412 | |||||||||||||
Selling, general and administrative expenses, exclusive of depreciation | 559,642 | (357 | ) | — | — | — | — | 559,285 | ||||||||||||||||||||
Amortization of intangible assets | 36,659 | — | (4,480 | ) | — | — | — | 32,179 | ||||||||||||||||||||
Facility consolidation and asset impairment charges | 25,802 | — | (9,615 | ) | (16,187 | ) | — | — | — | |||||||||||||||||||
Operating expenses | 1,499,680 | (2,381 | ) | (14,095 | ) | (16,187 | ) | — | — | 1,467,017 | ||||||||||||||||||
Operating income | 469,747 | 2,381 | 14,095 | 16,187 | — | — | 502,410 | |||||||||||||||||||||
Equity income in unconsolidated investees, net | 156,792 | — | — | — | (142,003 | ) | — | 14,789 | ||||||||||||||||||||
Other non-operating items | (39,762 | ) | — | — | — | 39,371 | — | (391 | ) | |||||||||||||||||||
Total non-operating expense | (82,254 | ) | — | — | — | (102,632 | ) | — | (184,886 | ) | ||||||||||||||||||
Income before income taxes | 387,493 | 2,381 | 14,095 | 16,187 | (102,632 | ) | — | 317,524 | ||||||||||||||||||||
Provision for income taxes | 145,731 | 885 | 4,413 | 1,328 | (40,079 | ) | (19,283 | ) | 92,995 | |||||||||||||||||||
Net income from continuing operations attributable to TEGNA | 192,411 | 1,496 | 9,682 | 14,859 | (62,553 | ) | 19,283 | 175,178 | ||||||||||||||||||||
Net income from continuing operations per share - diluted | $ | 0.83 | $ | 0.01 | $ | 0.04 | $ | 0.06 | $ | (0.27 | ) | $ | 0.08 | $ | 0.75 | |||||||||||||
NON-GAAP FINANCIAL INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars |
|||||||||||||||||||||||
Table No. 4 | |||||||||||||||||||||||
Reconciliations of Adjusted EBITDA to the most directly comparable financial measure calculated and presented in accordance with GAAP on the company's condensed consolidated statements of income follow: |
|||||||||||||||||||||||
Thirteen weeks ended Sep. 27, 2015: | |||||||||||||||||||||||
TEGNA |
TEGNA |
TEGNA |
Corporate |
Consolidated Total |
|||||||||||||||||||
Net income from continuing operations attributable to Parent (GAAP basis) | $ | 90,614 | |||||||||||||||||||||
Net income attributable to noncontrolling interests | 17,487 | ||||||||||||||||||||||
Provision for income taxes | 37,178 | ||||||||||||||||||||||
Interest expense | 66,949 | ||||||||||||||||||||||
Equity loss in unconsolidated investees, net | 1,013 | ||||||||||||||||||||||
Other non-operating items | 3,116 | ||||||||||||||||||||||
Adjusted operating income (GAAP and non-GAAP basis) | $ | 158,595 | $ | 72,445 | $ | (1,744 | ) | $ | (12,939 | ) | $ | 216,357 | |||||||||||
Depreciation | 12,915 | 8,063 | 205 | 540 | 21,723 | ||||||||||||||||||
Amortization | 5,491 | 23,010 | — | — | 28,501 | ||||||||||||||||||
Adjusted EBITDA (non-GAAP basis) | $ | 177,001 | $ | 103,518 | $ | (1,539 | ) | $ | (12,399 | ) | $ | 266,581 | |||||||||||
Thirteen weeks ended Sep. 28, 2014: | |||||||||||||||||||||||
TEGNA |
TEGNA |
TEGNA |
Corporate |
Unallocated |
Consolidated Total |
||||||||||||||||||
Net income from continuing operations attributable to Parent (GAAP basis) | $ | 50,648 | |||||||||||||||||||||
Net income attributable to noncontrolling interests | 21,476 | ||||||||||||||||||||||
Provision for income taxes | 29,782 | ||||||||||||||||||||||
Interest expense | 65,791 | ||||||||||||||||||||||
Equity loss in unconsolidated investees, net | 981 | ||||||||||||||||||||||
Other non-operating items | 15,326 | ||||||||||||||||||||||
Operating income (GAAP basis) | $ | 177,970 | $ | 41,249 | $ | 1,230 | $ | (18,219 | ) | $ | (18,226 | ) | $ | 184,004 | |||||||||
Workforce restructuring | 120 | — | — | — | — | 120 | |||||||||||||||||
Other transformation costs | 1,230 | — | — | — | — | 1,230 | |||||||||||||||||
Adjusted operating income (non-GAAP basis) | 179,320 | 41,249 | 1,230 | (18,219 | ) | (18,226 | ) | 185,354 | |||||||||||||||
Depreciation | 12,629 | 5,544 | 253 | 2,868 | — | 21,294 | |||||||||||||||||
Amortization | 6,448 | 4,985 | — | — | — | 11,433 | |||||||||||||||||
Adjusted EBITDA (non-GAAP basis) | $ | 198,397 | $ | 51,778 | $ | 1,483 | $ | (15,351 | ) | $ | (18,226 | ) | $ | 218,081 | |||||||||
NON-GAAP FINANCIAL INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars |
||||||||||||||||||||||||
Table No. 4 (continued) | ||||||||||||||||||||||||
Thirty-nine weeks ended Sep. 27, 2015: | ||||||||||||||||||||||||
TEGNA |
TEGNA |
TEGNA |
Corporate |
Unallocated |
Consolidated Total |
|||||||||||||||||||
Net income from continuing operations attributable to Parent (GAAP basis) | $ | 191,532 | ||||||||||||||||||||||
Net income attributable to noncontrolling interests | 47,700 | |||||||||||||||||||||||
Provision for income taxes | 119,157 | |||||||||||||||||||||||
Interest expense | 206,871 | |||||||||||||||||||||||
Equity loss in unconsolidated investees, net | 4,123 | |||||||||||||||||||||||
Other non-operating items | 5,346 | |||||||||||||||||||||||
Operating income (GAAP basis) | $ | 513,557 | $ | 175,462 | $ | (11,000 | ) | $ | (50,817 | ) | $ | (52,473 | ) | $ | 574,729 | |||||||||
Workforce restructuring | 348 | 2,167 | 300 | — | — | 2,815 | ||||||||||||||||||
Other transformation items | (7,636 | ) | 11,107 | 170 | — | — | 3,641 | |||||||||||||||||
Asset impairment charges | — | 900 | 5,940 | — | — | 6,840 | ||||||||||||||||||
Adjusted operating income (non-GAAP basis) | 506,269 | 189,636 | (4,590 | ) | (50,817 | ) | (52,473 | ) | 588,025 | |||||||||||||||
Depreciation | 39,455 | 24,852 | 608 | 6,445 | — | 71,360 | ||||||||||||||||||
Amortization | 16,964 | 69,191 | — | — | — | 86,155 | ||||||||||||||||||
Adjusted EBITDA (non-GAAP basis) | $ | 562,688 | $ | 283,679 | $ | (3,982 | ) | $ | (44,372 | ) | $ | (52,473 | ) | $ | 745,540 | |||||||||
Thirty-nine weeks ended Sep. 28, 2014: | ||||||||||||||||||||||||
TEGNA |
TEGNA |
TEGNA |
Corporate |
Unallocated |
Consolidated Total |
|||||||||||||||||||
Net income from continuing operations attributable to Parent (GAAP basis) | $ | 192,411 | ||||||||||||||||||||||
Net income attributable to noncontrolling interests | 49,351 | |||||||||||||||||||||||
Provision for income taxes | 145,731 | |||||||||||||||||||||||
Interest expense | 199,284 | |||||||||||||||||||||||
Equity income in unconsolidated investees, net | (156,792 | ) | ||||||||||||||||||||||
Other non-operating items | 39,762 | |||||||||||||||||||||||
Operating income (GAAP basis) | $ | 503,841 | $ | 89,003 | $ | (10,527 | ) | $ | (53,340 | ) | $ | (59,230 | ) | $ | 469,747 | |||||||||
Workforce restructuring | 2,381 | — | — | — | — | 2,381 | ||||||||||||||||||
Other transformation costs | 14,095 | — | — | — | — | 14,095 | ||||||||||||||||||
Asset impairment charges | — | — | 16,187 | — | — | 16,187 | ||||||||||||||||||
Adjusted operating income (non-GAAP basis) | 520,317 | 89,003 | 5,660 | (53,340 | ) | (59,230 | ) | 502,410 | ||||||||||||||||
Depreciation | 35,953 | 15,764 | 745 | 8,679 | — | 61,141 | ||||||||||||||||||
Adjusted amortization (non-GAAP basis) | 18,074 | 13,903 | 202 | — | — | 32,179 | ||||||||||||||||||
Adjusted EBITDA (non-GAAP basis) | $ | 574,344 | $ | 118,670 | $ | 6,607 | $ | (44,661 | ) | $ | (59,230 | ) | $ | 595,730 | ||||||||||
NON-GAAP FINANCIAL INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars |
||||||||
Table No. 5 | ||||||||
"Free cash flow" is a non-GAAP liquidity measure used in addition to and in conjunction with results presented in accordance with GAAP. Free cash flow should not be relied upon to the exclusion of GAAP financial measures. |
||||||||
Thirteen weeks ended Sep. 27, 2015 |
Thirty-nine weeks ended Sep. 27, 2015 |
|||||||
Net cash flow from operating activities | $ | 183,825 | $ | 479,233 | ||||
Purchase of property, plant and equipment | (19,876 | ) | (74,897 | ) | ||||
Voluntary pension employer contribution | — | 100,000 | ||||||
Tax benefit for voluntary pension employer contribution | — | (37,200 | ) | |||||
Free cash flow | $ | 163,949 | $ | 467,136 | ||||
TAX RATE CALCULATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars |
||||||||||||||||
Table No. 6 | ||||||||||||||||
The calculations of the company's effective tax rate on a GAAP and non-GAAP basis are below: | ||||||||||||||||
GAAP | Non-GAAP | |||||||||||||||
Thirteen weeks ended Sep. 27, 2015 |
Thirteen weeks ended Sep. 28, 2014 |
Thirteen weeks ended Sep. 27, 2015 |
Thirteen weeks ended Sep. 28, 2014 |
|||||||||||||
Income before taxes (per Table 3) | $ | 145,279 | $ | 101,906 | $ | 145,279 | $ | 123,734 | ||||||||
Noncontrolling interests (per Table 1) | (17,487 | ) | (21,476 | ) | (17,487 | ) | (21,476 | ) | ||||||||
Income before taxes attributable to Parent | $ | 127,792 | $ | 80,430 | $ | 127,792 | $ | 102,258 | ||||||||
Provision for income taxes (per Table 3) | $ | 37,178 | $ | 29,782 | $ | 43,194 | $ | 34,079 | ||||||||
Effective tax rate | 29.1 | % | 37.0 | % | 33.8 | % | 33.3 | % | ||||||||
GAAP | Non-GAAP | |||||||||||||||
Thirty-nine weeks ended Sep. 27, 2015 |
Thirty-nine weeks ended Sep. 28, 2014 |
Thirty-nine weeks ended Sep. 27, 2015 |
Thirty-nine weeks ended Sep. 28, 2014 |
|||||||||||||
Income before taxes (per Table 3) | $ | 358,389 | $ | 387,493 | $ | 373,138 | $ | 317,524 | ||||||||
Noncontrolling interests (per Table 1) | (47,700 | ) | (49,351 | ) | (47,700 | ) | (49,351 | ) | ||||||||
Income before taxes attributable to Parent | $ | 310,689 | $ | 338,142 | $ | 325,438 | $ | 268,173 | ||||||||
Provision for income taxes (per Table 3) | $ | 119,157 | $ | 145,731 | 117,237 | $ | 92,995 | |||||||||
Effective tax rate | 38.4 | % | 43.1 | % | 36.0 | % | 34.7 | % | ||||||||
NON-GAAP FINANCIAL INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars |
|||||||||||||||||||||||
Table No. 7 | |||||||||||||||||||||||
A reconciliation of the company's operating data on an as reported basis to a pro forma basis is below: | |||||||||||||||||||||||
TEGNA
GAAP Cont Ops |
Pro Forma
Adjustment for Separation (1) |
Pro Forma
TEGNA Cont Ops |
Special Items (2) |
Acquisition and
Disposition Pro Forma Adjustments (3) |
TEGNA
Pro Forma Non GAAP |
||||||||||||||||||
Thirteen weeks ended Mar. 30, 2014 | |||||||||||||||||||||||
Operating Revenue | $ | 619,887 | $ | 3,261 | $ | 623,148 | $ | — | $ | 123,522 | $ | 746,670 | |||||||||||
Operating Expenses | 486,767 | (1,439 | ) | 485,328 | (9,756 | ) | 114,764 | 590,336 | |||||||||||||||
Operating Income | 133,120 | 4,700 | 137,820 | 9,756 | 8,758 | 156,334 | |||||||||||||||||
Depreciation | 19,863 | 89 | 19,952 | — | 2,958 | 22,910 | |||||||||||||||||
Amortization | 14,231 | 372 | 14,603 | (4,480 | ) | 18,799 | 28,922 | ||||||||||||||||
Adjusted EBITDA | $ | 167,214 | $ | 5,161 | $ | 172,375 | $ | 5,276 | $ | 30,515 | $ | 208,166 | |||||||||||
Thirteen weeks ended Jun. 29, 2014 | |||||||||||||||||||||||
Operating Revenue | $ | 668,555 | $ | 3,389 | $ | 671,944 | $ | — | $ | 125,456 | $ | 797,400 | |||||||||||
Operating Expenses | 515,932 | (1,502 | ) | 514,430 | (21,557 | ) | 116,128 | 609,001 | |||||||||||||||
Operating Income | 152,623 | 4,891 | 157,514 | 21,557 | 9,328 | 188,399 | |||||||||||||||||
Depreciation | 19,984 | 89 | 20,073 | — | 2,861 | 22,934 | |||||||||||||||||
Amortization | 10,995 | 372 | 11,367 | — | 18,799 | 30,166 | |||||||||||||||||
Adjusted EBITDA | $ | 183,602 | $ | 5,352 | $ | 188,954 | $ | 21,557 | $ | 30,988 | $ | 241,499 | |||||||||||
Thirteen weeks ended Sept. 28, 2014 | |||||||||||||||||||||||
Operating Revenue | $ | 680,985 | $ | 3,480 | $ | 684,465 | $ | — | $ | 118,402 | $ | 802,867 | |||||||||||
Operating Expenses | 496,981 | (1,775 | ) | 495,206 | (1,350 | ) | 107,497 | 601,353 | |||||||||||||||
Operating Income | 184,004 | 5,255 | 189,259 | 1,350 | 10,905 | 201,514 | |||||||||||||||||
Depreciation | 21,294 | (82 | ) | 21,212 | — | 2,780 | 23,992 | ||||||||||||||||
Amortization | 11,433 | — | 11,433 | — | 18,164 | 29,597 | |||||||||||||||||
Adjusted EBITDA | $ | 216,731 | $ | 5,173 | $ | 221,904 | $ | 1,350 | $ | 31,849 | $ | 255,103 | |||||||||||
Thirteen weeks ended Dec. 28, 2014 | |||||||||||||||||||||||
Operating Revenue | $ | 904,886 | $ | 531 | $ | 905,417 | $ | — | $ | (7,487 | ) | $ | 897,930 | ||||||||||
Operating Expenses | 674,317 | (675 | ) | 673,642 | (39,807 | ) | (5,805 | ) | 628,030 | ||||||||||||||
Operating Income | 230,569 | 1,206 | 231,775 | 39,807 | (1,682 | ) | 269,900 | ||||||||||||||||
Depreciation | 25,699 | (55 | ) | 25,644 | — | 28 | 25,672 | ||||||||||||||||
Amortization | 29,312 | — | 29,312 | — | — | 29,312 | |||||||||||||||||
Adjusted EBITDA | $ | 285,580 | $ | 1,151 | $ | 286,731 | $ | 39,807 | $ | (1,654 | ) | $ | 324,884 | ||||||||||
NON-GAAP FINANCIAL INFORMATION |
|||||||||||||||||||||||
TEGNA Inc. and Subsidiaries |
|||||||||||||||||||||||
Unaudited, in thousands of dollars |
|||||||||||||||||||||||
Table No. 7 (continued) | |||||||||||||||||||||||
TEGNA
GAAP Cont Ops |
Pro Forma
Adjustment for Separation (1) |
Pro Forma
TEGNA Cont Ops |
Special Items (2) |
Acquisition and
Disposition Pro Forma Adjustments (3) |
TEGNA
Pro Forma Non GAAP |
||||||||||||||||||
Thirteen weeks ended Mar. 29, 2015 | |||||||||||||||||||||||
Operating Revenue | $ | 778,015 | $ | — | $ | 778,015 | $ | — | $ | — | $ | 778,015 | |||||||||||
Operating Expenses | 607,411 | (925 | ) | 606,486 | 676 | 607,162 | |||||||||||||||||
Operating Income | 170,604 | 925 | 171,529 | (676 | ) | — | 170,853 | ||||||||||||||||
Depreciation | 24,487 | — | 24,487 | — | — | 24,487 | |||||||||||||||||
Amortization | 28,688 | — | 28,688 | — | — | 28,688 | |||||||||||||||||
Adjusted EBITDA | $ | 223,779 | $ | 925 | $ | 224,704 | $ | (676 | ) | $ | — | $ | 224,028 | ||||||||||
Thirteen weeks ended Jun. 28, 2015 | |||||||||||||||||||||||
Operating Revenue | $ | 816,136 | $ | — | $ | 816,136 | $ | — | $ | — | $ | 816,136 | |||||||||||
Operating Expenses | 628,368 | (1,815 | ) |
|
$ | 626,553 | (13,973 | ) | — | 612,580 | |||||||||||||
Operating Income | 187,768 | 1,815 |
|
189,583 | 13,973 | — | 203,556 | ||||||||||||||||
Depreciation | 25,150 | — |
|
25,150 | — | — | 25,150 | ||||||||||||||||
Amortization | 28,966 | — |
|
28,966 | — | — | 28,966 | ||||||||||||||||
Adjusted EBITDA | $ | 241,884 | $ | 1,815 | $ | 243,699 | $ | 13,973 | $ | — | $ | 257,672 |
(1) Represents adjustments related to office space leasing and
information technology arrangements between
(2) Special items include workforce restructuring, other transformation costs and asset impairment charges.
(3) The pro forma adjustments include the acquisitions of Cars.com and
NON-GAAP FINANCIAL INFORMATION
TEGNA Inc. and Subsidiaries Unaudited, in thousands of dollars |
|||||||||||||||||||||||
Table No. 8 | |||||||||||||||||||||||
The company's operating data on a pro forma basis is below: | |||||||||||||||||||||||
TEGNA
Media |
TEGNA
Digital |
TEGNA
Other |
Corporate | Unallocated (a) |
TEGNA
Pro Forma Non GAAP |
||||||||||||||||||
Thirteen weeks ended Mar. 30, 2014 | |||||||||||||||||||||||
Operating Revenue | $ | 394,480 | $ | 305,726 | $ | 46,464 | $ | — | $ | — | $ | 746,670 | |||||||||||
Operating Expense | 227,507 | 280,886 | 51,600 | 17,367 | 12,976 | 590,336 | |||||||||||||||||
Operating Income | 166,973 | 24,840 | (5,136 | ) | (17,367 | ) | (12,976 | ) | 156,334 | ||||||||||||||
Depreciation | 12,430 | 7,077 | 370 | 3,033 | — | 22,910 | |||||||||||||||||
Amortization | 5,742 | 23,079 | 101 | — | — | 28,922 | |||||||||||||||||
Adjusted EBITDA | $ | 185,145 | $ | 54,996 | $ | (4,665 | ) | $ | (14,334 | ) | $ | (12,976 | ) | $ | 208,166 | ||||||||
Thirteen weeks ended Jun. 29, 2014 | |||||||||||||||||||||||
Operating Revenue | $ | 410,764 | $ | 323,153 | $ | 63,483 | $ | — | $ | — | $ | 797,400 | |||||||||||
Operating Expense | 234,069 | 287,172 | 57,836 | 17,754 | 12,170 | 609,001 | |||||||||||||||||
Operating Income | 176,695 | 35,981 | 5,647 | (17,754 | ) | (12,170 | ) | 188,399 | |||||||||||||||
Depreciation | 12,360 | 7,426 | 245 | 2,903 | — | 22,934 | |||||||||||||||||
Amortization | 5,884 | 24,181 | 101 | — | — | 30,166 | |||||||||||||||||
Adjusted EBITDA | $ | 194,939 | $ | 67,588 | $ | 5,993 | $ | (14,851 | ) | $ | (12,170 | ) | $ | 241,499 | |||||||||
Thirteen weeks ended Sept. 28, 2014 | |||||||||||||||||||||||
Operating Revenue | $ | 416,590 | $ | 333,488 | $ | 52,789 | $ | — | $ | — | $ | 802,867 | |||||||||||
Operating Expense | 237,109 | 282,412 | 52,608 | 18,219 | 11,005 | 601,353 | |||||||||||||||||
Operating Income | 179,481 | 51,076 | 181 | (18,219 | ) | (11,005 | ) | 201,514 | |||||||||||||||
Depreciation | 12,684 | 8,187 | 253 | 2,868 | — | 23,992 | |||||||||||||||||
Amortization | 6,448 | 23,149 | — | — | — | 29,597 | |||||||||||||||||
Adjusted EBITDA | $ | 198,613 | $ | 82,412 | $ | 434 | $ | (15,351 | ) | $ | (11,005 | ) | $ | 255,103 | |||||||||
Thirteen weeks ended Dec. 28, 2014 | |||||||||||||||||||||||
Operating Revenue | $ | 494,831 | $ | 347,746 | $ | 55,353 | $ | — | $ | — | $ | 897,930 | |||||||||||
Operating Expense | 246,344 | 281,957 | 53,308 | 17,801 | 28,620 | 628,030 | |||||||||||||||||
Operating Income | 248,487 | 65,789 | 2,045 | (17,801 | ) | (28,620 | ) | 269,900 | |||||||||||||||
Depreciation | 15,860 | 7,587 | 202 | 2,023 | — | 25,672 | |||||||||||||||||
Amortization | 6,163 | 23,149 | — | — | — | 29,312 | |||||||||||||||||
Adjusted EBITDA | $ | 270,510 | $ | 96,525 | $ | 2,247 | $ | (15,778 | ) | $ | (28,620 | ) | $ | 324,884 | |||||||||
(a) Unallocated expenses represent certain expenses that historically were allocated to the former Publishing Segment but that could not be allocated to discontinued operations because they were not clearly and specifically identifiable to the spun-off businesses, the accounting criteria for reclassification to discontinued operations. |
|||||||||||||||||||||||
Table No. 8 (continued) | |||||||||||||||||||||||
TEGNA
Media |
TEGNA
Digital |
TEGNA
Other |
Corporate | Unallocated (a) |
TEGNA
Pro Forma Non GAAP |
||||||||||||||||||
Thirteen weeks ended Mar. 29, 2015 | |||||||||||||||||||||||
Operating Revenue | $ | 396,417 | $ | 335,075 | $ | 46,523 | $ | — | $ | — | $ | 778,015 | |||||||||||
Operating Expense | 229,531 | 283,687 | 52,280 | 18,860 | 22,804 | 607,162 | |||||||||||||||||
Operating Income | 166,886 | 51,388 | (5,757 | ) | (18,860 | ) | (22,804 | ) | 170,853 | ||||||||||||||
Depreciation | 13,296 | 8,262 | 208 | 2,721 | — | 24,487 | |||||||||||||||||
Amortization | 5,598 | 23,090 | — | — | — | 28,688 | |||||||||||||||||
Adjusted EBITDA | $ | 185,780 | $ | 82,740 | $ | (5,549 | ) | $ | (16,139 | ) | $ | (22,804 | ) | $ | 224,028 | ||||||||
Thirteen weeks ended Jun. 28, 2015 | |||||||||||||||||||||||
Operating Revenue | $ | 417,049 | $ | 339,622 | $ | 59,465 | $ | — | $ | — | $ | 816,136 | |||||||||||
Operating Expense | 236,262 | 273,820 | 56,636 | 19,018 | 26,844 | 612,580 | |||||||||||||||||
Operating Income | 180,787 | 65,802 | 2,829 | (19,018 | ) | (26,844 | ) | 203,556 | |||||||||||||||
Depreciation | 13,244 | 8,527 | 195 | 3,184 | — | 25,150 | |||||||||||||||||
Amortization | 5,876 | 23,090 | — | — | — | 28,966 | |||||||||||||||||
Adjusted EBITDA | $ | 199,907 | $ | 97,419 | $ | 3,024 | $ | (15,834 | ) | $ | (26,844 | ) | $ | 257,672 | |||||||||
(a) Unallocated expenses represent certain expenses that historically were allocated to the former Publishing Segment but that could not be allocated to discontinued operations because they were not clearly and specifically identifiable to the spun-off businesses, the accounting criteria for reclassification to discontinued operations. |
|||||||||||||||||||||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20151020005930/en/
Source:
TEGNA Inc.
For investor inquiries:
Jeffrey Heinz, 703-854-6917
Vice
President, Investor Relations
jheinz@TEGNA.com
or
For
media inquiries:
Jeremy Gaines, 703-854-6049
Vice President,
Corporate Communications
jmgaines@TEGNA.com