TEGNA Inc. Reports 2018 Third Quarter Results and Record Full-Year Political Revenue
Full-year political revenue exceeded previous mid-term election record by 50 percent
Highlights include:
-
Total company revenue from continuing operations in the third quarter
was
$539 million , up 16 percent year-over-year and in line with the guidance range provided last quarter. Adjusted total company revenue, excluding political advertising, was up four percent year-over-year, despite being negatively impacted by political displacement. -
Record-breaking
$238 million full-year political revenue, up 50 percent from the last mid-term election cycle, significantly above prior guidance of$180 million to $200 million .-
$60 million in the third quarter, up 51 percent from the previous mid-terms. -
$144 million in the fourth quarter, up 56 percent from the previous mid-terms. No material political revenue is expected from now to the end of the quarter.
-
-
Subscription revenue is on track to achieve the high-end of previously
announced full-year guidance of mid-teens growth.
-
Subscription revenue in the third quarter was 17 percent above
last year, a
$30 million increase. -
Paid subscribers have increased year-over-year for five
consecutive months, fueled by the continued growth of over-the-top
(“OTT”) subscribers in
TEGNA markets.
-
Subscription revenue in the third quarter was 17 percent above
last year, a
- High margin subscription and political revenues are expected to account for approximately half of our total two-year revenue beginning in 2019/2020, and a higher percentage on all two-year cycles thereafter.
- Total advertising and marketing services revenue in the third quarter, which excludes political revenue, declined five percent year-over-year due to crowd out from record political inventory.
-
Premion, TEGNA’s first to market OTT advertising service, remains on
pace to achieve full-year revenue guidance of
$75 million , excluding Premion political revenue, which is included in total reported political revenue. -
Total company adjusted EBITDA was
$180.9 million in the third quarter, up 25 percent year-over-year. -
Free cash flow in the quarter of
$164 million was 31 percent of revenue, a record high.TEGNA reduced debt by$144 million , resulting in total debt of$3.0 billion and net leverage of 4.2 times. -
Earlier this quarter, announced an agreement to acquire two leading
local media brands,
CBS affiliate WTOL inToledo, OH andNBC affiliate KWES inOdessa -Midland, TX , in a$105 million transaction with a multiple of 5.9 times based on average 2017/2018 EBITDA after synergies but prior to tax savings. These purchases are expected to be accretive to EPS in less than a year and immediately accretive to free cash flow; both are expected to close in the fourth quarter of 2018. -
GAAP earnings per diluted share from continuing operations were
$0.43 in the third quarter and non-GAAP* earnings per diluted share from continuing operations were$0.40 , an increase of 74 percent year-over-year.
* See “Use of Non-GAAP Information” below for more detail.
“We continue to execute growth in shareholder value with another quarter
of strong results driven by an increase in year-over-year paid
subscribers, strong subscription revenue, and record political revenue,”
said
THIRD QUARTER KEY METRICS
In analyzing third quarter 2018 results, TEGNA’s odd-to even-year results are positively impacted by cyclical political advertising drivers due to the company’s footprint in states that tend to see substantial campaign spending.
The following table presents key metrics (in thousands): | ||||||||
Q3 2018 Key Metrics | GAAP | Non-GAAP (b) | ||||||
Total company revenues |
$ |
538,976 |
NA |
|||||
Advertising and marketing services (a) | 264,852 | NA | ||||||
Subscription | 207,463 | NA | ||||||
Political | 60,410 | NA | ||||||
Other | 6,251 | NA | ||||||
Operating income | 154,284 | 158,566 | ||||||
Net income from continuing operations | 92,826 | 87,434 | ||||||
Earnings from continuing operations per share | $ | 0.43 | $ | 0.40 | ||||
Adjusted EBITDA | NA | 180,875 | ||||||
Adjusted EBITDA, excluding corporate expense | NA | 192,987 | ||||||
Free cash flow | NA | 164,202 | ||||||
Free cash flow as a percentage of revenue (c) | NA | 30.5 | % | |||||
(a) Includes traditional advertising, digital advertising as well as revenue from the company's digital marketing services business.
(b) Refer to Tables 2 through 5 for reconciliations to the most directly comparable financial measure calculated and presented in accordance with GAAP.
(c) Calculated as a percent of total GAAP revenues.
OVERVIEW OF THIRD QUARTER RESULTS
Total company revenues increased 16 percent in the quarter on a GAAP
basis primarily due to a
Subscription revenue grew 17 percent year-over-year driven by growth in OTT subscribers. This stable, profitable and growing source of revenue continues to reduce the impacts of advertising demand shifts on TEGNA’s portfolio.
Advertising and marketing services revenue was five percent lower in the quarter compared to the third quarter of 2017 due to crowd out from record political inventory.
GAAP expenses were up 11 percent year-over-year, primarily driven by expenses related to revenue growth, investments in Premion, higher programming fees and the acquisition of KFMB. Programming fees, which include reverse compensation paid to networks, increased mainly due to the growth in subscription revenues. Additionally, our strategy to reinvest the majority of Premion’s operating income continues to result in accelerating revenue growth.
GAAP operating income totaled
Net income from continuing operations was
Special items impacting operating expenses were
THIRD QUARTER NON-OPERATING AND CASH FLOW ITEMS
Interest expense in the quarter was
Other non-operating expenses were
Cash flow from operating activities for the third quarter of 2018 was
During the third quarter,
FOURTH QUARTER 2018 OUTLOOK
In the fourth quarter,
We expect non-GAAP operating expenses will increase mid-teens in the fourth quarter due to continued growth in programming fees and Premion reinvestments, as well as the fact that the majority of political advertising revenue will be recognized in the fourth quarter.
UPDATE ON KEY MESSAGES AND STRATEGIC INITIATIVES
-
Transition to ATSC 3.0 -
TEGNA joined other leading broadcasters in announcing support for the nationwide roll-out of the Next Generation over-the-air television transmission standard by the end of 2020. Next Gen TV will provide viewers dramatically improved services and opens up new opportunities and business models for local broadcasters.TEGNA continues to participate in the commercialization efforts in the Phoenix Model Market industry test bed with its station KPNX through 2019 in anticipation of ATSC 3.0 equipped television sets being available in 2020. -
Daily Blast LIVE (DBL) launched in 15 additional markets -
During the quarter, DBL launched on TEGNA’s KFMB in
San Diego , along with 14 additional non-TEGNA markets, including: WMUR inBoston , WMYD inDetroit , WMAR inBaltimore , WRTV inIndianapolis , KMCI inKansas City , WTMJ inMilwaukee and WWBT inRichmond . DBL is now available in a total of 50 markets. -
Structured Content Innovation process -
TEGNA held its 8th Innovation Summit, a disciplined strategic process of brainstorming, piloting, testing and execution. The summits have identified more than 60 pilot programs with 19 being greenlit. A recent example is “Mothers Matter,” a four- part digital, episodic investigation into the high death rate of American mothers from pregnancy related causes. In the first few days after launch, there were 1.5 million visitors to “Mothers Matter” content on stations’ digital sites and over five million page views. TEGNA’s content innovation efforts are core to our strategy of attracting new consumers and advertisers across platforms. -
TEGNA Marketing Solutions (TMS) - During the quarter,
TEGNA integrated the existing capabilities of in-house creative agency Hatch, digital marketing services provider G/O Digital and OTT advertising service Premion into one unified data-driven sales strategy. TEGNA Marketing Solutions, inclusive of Premion, is a result of the transformation of our go-to market strategy.
CAPITAL ALLOCATION AND M&A UPDATE
Our recently announced agreement to acquire WTOL in
CONFERENCE CALL
ADDITIONAL INFORMATION
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
CONSOLIDATED STATEMENTS OF INCOME |
|||||||||||
Continuing Operations |
|||||||||||
TEGNA Inc. | |||||||||||
Unaudited, in thousands of dollars (except per share amounts) |
|||||||||||
Table No. 1 |
|||||||||||
|
|||||||||||
Quarter ended September 30, |
|||||||||||
% Increase | |||||||||||
2018 | 2017 | (Decrease) | |||||||||
Revenues | $ | 538,976 | $ | 464,264 | 16.1 | ||||||
Operating expenses: | |||||||||||
Cost of revenues, exclusive of depreciation |
271,156 | 235,474 | 15.2 | ||||||||
Business units - Selling, general and administrative expenses, exclusive of depreciation |
76,639 | 70,914 | 8.1 | ||||||||
Corporate - General and administrative expenses, exclusive of depreciation | 17,593 | 12,881 | 36.6 | ||||||||
Depreciation | 14,262 | 15,186 | (6.1 | ) | |||||||
Amortization of intangible assets | 8,047 | 5,395 | 49.2 | ||||||||
Asset impairment and other (gains) charges | (3,005 | ) | 7,553 | *** | |||||||
Total | 384,692 | 347,403 | 10.7 | ||||||||
Operating income | 154,284 | 116,861 | 32.0 | ||||||||
Non-operating income (expense): | |||||||||||
Equity income (loss) in unconsolidated investments, net |
771 | 866 | (11.0 | ) | |||||||
Interest expense | (48,226 | ) | (51,855 | ) | (7.0 | ) | |||||
Other non-operating items, net | (214 | ) | (3,671 | ) | (94.2 | ) | |||||
Total | (47,669 | ) | (54,660 | ) | (12.8 | ) | |||||
Income before income taxes | 106,615 | 62,201 | 71.4 | ||||||||
Provision for income taxes | 13,789 | 11,447 | 20.5 | ||||||||
Net Income from continuing operations | $ | 92,826 | $ | 50,754 | 82.9 | ||||||
Earnings from continuing operations per share: | |||||||||||
Basic | $ | 0.43 | $ | 0.24 | 79.2 | ||||||
Diluted | $ | 0.43 | $ | 0.23 | 87.0 | ||||||
Weighted average number of common shares outstanding: |
|||||||||||
Basic | 216,015 | 215,863 | 0.1 | ||||||||
Diluted | 216,348 | 218,095 | (0.8 | ) | |||||||
Dividends declared per share | $ | 0.07 | $ | 0.07 | — |
CONSOLIDATED STATEMENTS OF INCOME | |||||||||||
Continuing Operations |
|||||||||||
TEGNA Inc. |
|||||||||||
Unaudited, in thousands of dollars (except per share amounts) |
|||||||||||
Table No. 1 (continued) |
|||||||||||
Nine months ended September 30, |
|||||||||||
% Increase | |||||||||||
2018 | 2017 | (Decrease) | |||||||||
Revenues | $ | 1,565,146 | $ | 1,412,703 | 10.8 | ||||||
Operating expenses: | |||||||||||
Cost of revenues, exclusive of depreciation |
793,943 | 696,565 | 14.0 | ||||||||
Business units - Selling, general and administrative expenses, exclusive of depreciation |
229,193 | 214,645 | 6.8 | ||||||||
Corporate - General and administrative expenses, exclusive of depreciation | 41,522 | 42,462 | (2.2 | ) | |||||||
Depreciation | 41,594 | 41,721 | (0.3 | ) | |||||||
Amortization of intangible assets | 22,791 | 16,172 | 40.9 | ||||||||
Asset impairment and other (gains) charges | (9,331 | ) | 11,086 | *** | |||||||
Total | 1,119,712 | 1,022,651 | 9.5 | ||||||||
Operating income | 445,434 | 390,052 | 14.2 | ||||||||
Non-operating income (expense): | |||||||||||
Equity income (loss) in unconsolidated investments, net |
15,080 | (1,549 | ) | *** | |||||||
Interest expense | (145,055 | ) | (162,113 | ) | (10.5 | ) | |||||
Other non-operating items, net | (13,005 | ) | (26,853 | ) | (51.6 | ) | |||||
Total | (142,980 | ) | (190,515 | ) | (25.0 | ) | |||||
Income before income taxes | 302,454 | 199,537 | 51.6 | ||||||||
Provision for income taxes | 61,929 | 54,855 | 12.9 | ||||||||
Net Income from continuing operations | $ | 240,525 | $ | 144,682 | 66.2 | ||||||
Earnings from continuing operations per share: |
|||||||||||
Basic | $ | 1.11 | $ | 0.67 | 65.7 | ||||||
Diluted | $ | 1.11 | $ | 0.66 | 68.2 | ||||||
Weighted average number of common shares outstanding: |
|||||||||||
Basic | 216,210 | 215,558 | 0.3 | ||||||||
Diluted | 216,617 | 217,827 | (0.6 | ) | |||||||
Dividends declared per share | $ | 0.21 | $ | 0.28 | (25.0 | ) | |||||
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, nor should they be considered superior to the related GAAP measures, and should be read together with financial information presented on a GAAP basis. Also, our non-GAAP measures may not be comparable to similarly titled measures of other companies.
Management and the company’s Board of Directors use the non-GAAP
financial measures for purposes of evaluating business unit and
consolidated company performance. Furthermore, the
We believe that such gains, expenses and charges are not indicative of normal, ongoing operations. Such items vary from period to period and are significantly impacted by the timing and nature of these events. Therefore, while we may incur or recognize these types of gains, expenses and charges in the future, we believe that removing these items for purposes of calculating the non-GAAP financial measures provides investors with a more focused presentation of our ongoing operating performance.
The company also discusses Adjusted EBITDA (with and without corporate expenses), non-GAAP financial performance measures that it believes offer a useful view of the overall operation of its businesses. The company defines Adjusted EBITDA as net income from continuing operations before (1) interest expense, (2) income taxes, (3) equity income (losses) in unconsolidated investments, net, (4) other non-operating items such as corporate transaction expenses (such as business acquisition and disposition costs) and investment income, (5) severance expense, (6) other charges, (7) impairment charges, (8) depreciation and (9) amortization. The most directly comparable GAAP financial measure to Adjusted EBITDA is Net income from continuing operations. Users should consider the limitations of using Adjusted EBITDA, including the fact that this measure does not provide a complete measure of our operating performance.
Adjusted EBITDA is not intended to purport to be an alternative to net income as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. In particular, Adjusted EBITDA is not intended to be a measure of free cash flow available for management’s discretionary expenditures, as this measure does not consider certain cash requirements, such as working capital needs, capital expenditures, contractual commitments, interest payments, tax payments and other debt service requirements.
The company also considers adjusted revenues to be an important non-GAAP financial measure. Adjusted revenue is calculated by taking total company revenues on a GAAP basis and adjusting it to exclude political revenues. This adjustment is made to the company's reported revenue on a GAAP basis in order to evaluate and assess our core operations on a comparable basis, and it represents the ongoing operations of our broadcast business.
This earnings release 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 and equipment”. 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 discussions with the investment community. Like Adjusted EBITDA, free cash flow is not intended to be a measure of cash flow available for management’s discretionary use.
Tabular reconciliations for all of the non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the following tables.
NON-GAAP FINANCIAL INFORMATION |
TEGNA Inc. |
Unaudited, in thousands of dollars (except per share amounts) |
Table No. 2 |
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 consolidated statements of income follow: |
GAAP |
Non-GAAP |
||||||||||||||||||||||
Measure |
Special Items |
Measure |
|||||||||||||||||||||
Quarter ended |
Operating |
Severance |
Pension |
Special tax |
Quarter ended |
||||||||||||||||||
Cost of revenues, exclusive of depreciation |
$ | 271,156 | $ | — | $ | (931 | ) | $ | — | $ | — | $ | 270,225 | ||||||||||
Business units - Selling, general and administrative expenses, exclusive of depreciation |
76,639 | — | (875 | ) | — | — | 75,764 | ||||||||||||||||
Corporate - General and administrative expenses, exclusive of depreciation |
17,593 | — | (5,481 | ) | — | — | 12,112 | ||||||||||||||||
Asset impairment and other (gains) | (3,005 | ) | 3,005 | — | — | — | — | ||||||||||||||||
Operating expenses | 384,692 | 3,005 | (7,287 | ) | — | — | 380,410 | ||||||||||||||||
Operating income | 154,284 | (3,005 | ) | 7,287 | — | — | 158,566 | ||||||||||||||||
Other non-operating items | (214 | ) | — | — | 1,198 | — | 984 | ||||||||||||||||
Total non-operating expense | (47,669 | ) | — | — | 1,198 | — | (46,471 | ) | |||||||||||||||
Income before income taxes | 106,615 | (3,005 | ) | 7,287 | 1,198 | — | 112,095 | ||||||||||||||||
Provision for income taxes | 13,789 | (800 | ) | 1,714 | 301 | 9,657 | 24,661 | ||||||||||||||||
Net income from continuing operations | 92,826 | (2,205 | ) | 5,573 | 897 | (9,657 | ) | 87,434 | |||||||||||||||
Net income from continuing operations per share-diluted (a) |
$ | 0.43 | $ | (0.01 | ) | $ | 0.03 | $ | — | $ | (0.04 | ) | $ | 0.40 | |||||||||
(a) - Per share amounts do not sum due to rounding. |
GAAP |
Non-GAAP | ||||||||||||||||||
Measure |
Special Items |
Measure | |||||||||||||||||
Quarter ended Sept. 30, 2017 |
Operating asset impairment and other |
Other non- operating items |
Special tax benefit |
Quarter ended Sept. 30, 2017 |
|||||||||||||||
Asset impairment and other charges | $ | 7,553 | $ | (7,553 | ) | $ | — | $ | — | $ | — | ||||||||
Operating expenses | 347,403 | (7,553 | ) | — | — | 339,850 | |||||||||||||
Operating income | 116,861 | 7,553 | — | — | 124,414 | ||||||||||||||
Other non-operating items | (3,671 | ) | — | 2,688 | — | (983 | ) | ||||||||||||
Total non-operating expense | (54,660 | ) | — | 2,688 | — | (51,972 | ) | ||||||||||||
Income before income taxes | 62,201 | 7,553 | 2,688 | — | 72,442 | ||||||||||||||
Provision for income taxes | 11,447 | 2,780 | 629 | 8,086 | 22,942 | ||||||||||||||
Net income from continuing operations | 50,754 | 4,773 | 2,059 | (8,086 | ) | 49,500 | |||||||||||||
Net income from continuing operations per share-diluted (a) |
$ | 0.23 | $ | 0.02 | $ | 0.01 | $ | (0.04 | ) | $ | 0.23 | ||||||||
(a) - Per share amounts do not sum due to rounding. |
NON-GAAP FINANCIAL INFORMATION |
TEGNA Inc. |
Unaudited, in thousands of dollars (except per share amounts) |
Table No. 2 (continued) |
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 | Non-GAAP | |||||||||||||||||||||||||||||
Measure | Special Items | Measure | ||||||||||||||||||||||||||||
Nine months ended Sept. 30, 2018 |
Severance expense |
Operating asset impairment and other |
Pension payment timing related charges |
Other non- |
Net gain on equity method investment |
Special tax benefit |
Nine months ended Sept. 30, 2018 |
|||||||||||||||||||||||
Cost of revenues, exclusive of depreciation |
$ | 793,943 | $ | (931 | ) | $ | — | $ | — | $ | — | $ | — | $ |
— |
|
$ |
793,012 |
||||||||||||
Business units - Selling, general and administrative expenses, exclusive of depreciation |
229,193 | (875 | ) | — | — | — | — | — | 228,318 | |||||||||||||||||||||
Corporate - General and administrative expenses, exclusive of depreciation |
41,522 | (5,481 | ) | — | — | — | — | — | 36,041 | |||||||||||||||||||||
Asset impairment and other (gains) | (9,331 | ) | — | 9,331 | — | — | — | — | — | |||||||||||||||||||||
Operating expenses | 1,119,712 | (7,287 | ) | 9,331 | — | — | — |
— |
|
1,121,756 |
||||||||||||||||||||
Operating income | 445,434 | 7,287 | (9,331 | ) | — | — | — | — | 443,390 | |||||||||||||||||||||
Equity income in unconsolidated investments, net |
15,080 | — | — | — | — | (16,758 | ) | — | (1,678 | ) | ||||||||||||||||||||
Other non-operating items | (13,005 | ) | — | — | 7,498 | 15,184 | — | — | 9,677 | |||||||||||||||||||||
Total non-operating expense | (142,980 | ) | — | — | 7,498 | 15,184 | (16,758 | ) | — | (137,056 | ) | |||||||||||||||||||
Income before income taxes | 302,454 | 7,287 | (9,331 | ) | 7,498 | 15,184 | (16,758 | ) | — | 306,334 | ||||||||||||||||||||
Provision for income taxes | 61,929 | 1,714 | (798 | ) | 1,909 | 2,178 | (4,216 | ) | 7,007 | 69,723 | ||||||||||||||||||||
Net income from continuing operations | 240,525 | 5,573 | (8,533 | ) | 5,589 | 13,006 | (12,542 | ) | (7,007 | ) | 236,611 | |||||||||||||||||||
Net income from continuing operations per share-diluted (a) |
$ | 1.11 | $ | 0.03 | $ | (0.04 | ) | $ | 0.03 | $ | 0.06 | $ | (0.06 | ) | $ | (0.03 |
) |
$ |
1.09 |
|||||||||||
(a) - Per share amounts do not sum due to rounding. |
GAAP | Non-GAAP | ||||||||||||||||||||||
Measure | Special Items | Measure | |||||||||||||||||||||
Nine months ended Sept. 30, 2017 |
Severance expense |
Operating |
Other |
Special tax benefit |
Nine months ended Sept. 30, 2017 |
||||||||||||||||||
Cost of revenues, exclusive of depreciation | $ | 696,565 |
$ |
(522 |
) |
$ | — | $ | — | $ | — | $ | 696,043 | ||||||||||
Business units - Selling, general and administrative expenses, exclusive of depreciation |
214,645 |
(1,471 |
) |
— | — | — | 213,174 | ||||||||||||||||
Corporate - General and administrative expenses, exclusive of depreciation |
42,462 |
(1,060 |
) |
— | — | — | 41,402 | ||||||||||||||||
Asset impairment and other charges | 11,086 | — |
(11,086 |
) |
— | — | — | ||||||||||||||||
Operating expenses | 1,022,651 |
(3,053 |
) |
(11,086 |
) |
— | — | 1,008,512 | |||||||||||||||
Operating income | 390,052 | 3,053 | 11,086 | — | — | 404,191 | |||||||||||||||||
Other non-operating items |
(26,853 |
) |
— | — | 31,991 | — | 5,138 | ||||||||||||||||
Total non-operating expense |
(190,515 |
) |
— | — | 31,991 | — |
(158,524 |
) |
|||||||||||||||
Income before income taxes | 199,537 | 3,053 | 11,086 | 31,991 | — | 245,667 | |||||||||||||||||
Provision for income taxes | 54,855 | 1,174 | 4,104 | 6,921 | 11,724 | 78,778 | |||||||||||||||||
Net income from continuing operations | 144,682 | 1,879 | 6,982 | 25,070 |
(11,724 |
) |
166,889 | ||||||||||||||||
Net income from continuing operations per share-diluted | |||||||||||||||||||||||
$ | 0.66 | $ | 0.01 | $ | 0.03 | $ | 0.12 |
$ |
(0.05 |
) |
$ | 0.77 |
NON-GAAP FINANCIAL INFORMATION |
|||||||||||
TEGNA Inc. |
|||||||||||
Unaudited, in thousands of dollars | |||||||||||
Table No. 3 |
|||||||||||
Quarter ended September 30, | |||||||||||
2018 |
2017 |
% Increase |
|||||||||
Net income from continuing operations (GAAP basis) | $ | 92,826 | $ | 50,754 | 82.9 | ||||||
Provision for income taxes | 13,789 | 11,447 | 20.5 | ||||||||
Interest expense | 48,226 | 51,855 | (7.0 | ) | |||||||
Equity income in unconsolidated investments, net | (771 | ) | (866 | ) | (11.0 | ) | |||||
Other non-operating items | 214 | 3,671 | (94.2 | ) | |||||||
Operating income (GAAP basis) | 154,284 | 116,861 | 32.0 | ||||||||
Severance expense | 7,287 | — | *** | ||||||||
Asset impairment and other (gains) charges | (3,005 | ) | 7,553 | *** | |||||||
Adjusted operating income (non-GAAP basis) | 158,566 | 124,414 | 27.5 | ||||||||
Depreciation | 14,262 | 15,186 | (6.1 | ) | |||||||
Amortization of intangible assets | 8,047 | 5,395 | 49.2 | ||||||||
Adjusted EBITDA (Non-GAAP basis) |
$ |
180,875 | $ | 144,995 | 24.7 | ||||||
Corporate - General and administrative expense, exclusive of depreciation (non-GAAP basis) |
12,112 | 12,881 | (6.0 | ) | |||||||
Adjusted EBITDA, excluding Corporate (Non-GAAP basis) |
$ |
192,987 | $ | 157,876 | 22.2 |
Nine months ended September 30, |
|||||||||||
% Increase | |||||||||||
2018 | 2017 | (Decrease) | |||||||||
Net income from continuing operations (GAAP basis) | $ | 240,525 | $ | 144,682 | 66.2 | ||||||
Provision for income taxes | 61,929 | 54,855 | 12.9 | ||||||||
Interest expense | 145,055 | 162,113 | (10.5 | ) | |||||||
Equity (income) loss in unconsolidated investments, net |
(15,080 | ) | 1,549 | *** | |||||||
Other non-operating items | 13,005 | 26,853 | (51.6 | ) | |||||||
Operating income (GAAP basis) | 445,434 | 390,052 | 14.2 | ||||||||
Severance expense | 7,287 | 3,053 | *** | ||||||||
Asset impairment and other (gains) charges | (9,331 | ) | 11,086 | *** | |||||||
Adjusted operating income (non-GAAP basis) | 443,390 | 404,191 | 9.7 | ||||||||
Depreciation | 41,594 | 41,721 | (0.3 | ) | |||||||
Amortization of intangible assets | 22,791 | 16,172 | 40.9 | ||||||||
Adjusted EBITDA (Non-GAAP basis) | $ | 507,775 | $ | 462,084 | 9.9 | ||||||
Corporate - General and administrative expense, exclusive of depreciation (non-GAAP basis) |
36,041 | 41,402 | (12.9 | ) | |||||||
Adjusted EBITDA, excluding Corporate (Non-GAAP basis) |
$ | 543,816 | $ | 503,486 | 8.0 |
NON-GAAP FINANCIAL INFORMATION |
TEGNA Inc. |
Unaudited, in thousands of dollars |
Table No. 4 |
Reconciliations of adjusted revenues to our revenues presented in accordance with GAAP on our Consolidated Statements of Income are presented below (in thousands): |
|
|||||||||||
Quarter ended September 30, |
|||||||||||
% Increase | |||||||||||
2018 | 2017 | (Decrease) | |||||||||
Advertising and marketing services (a) |
$ |
264,852 |
$ |
277,817 |
(4.7 |
%) |
|||||
Subscription | 207,463 |
|
177,692 | 16.8 | % | ||||||
Political | 60,410 | 3,783 |
*** |
||||||||
Other | 6,251 | 4,972 | 25.7 | % | |||||||
Total revenues (GAAP basis) | $ | 538,976 | $ | 464,264 | 16.1 | % | |||||
Factor impacting comparisons: | |||||||||||
Political | (60,410 | ) | (3,783 | ) | *** | ||||||
Total company adjusted revenues (Non-GAAP basis) | $ | 478,566 | $ | 460,481 | 3.9 | % |
(a) Includes traditional advertising, digital advertising as well as revenue from the company's digital marketing services business.
NON-GAAP FINANCIAL INFORMATION |
TEGNA Inc. |
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 similar GAAP financial measures. |
Quarter ended September 30, |
Nine months ended September 30, |
|||||||||||||||
2018 |
2017 |
2018 |
2017 |
|||||||||||||
Net cash flow from operating activities | $ | 178,619 | $ | 108,715 | $ | 332,660 | $ | 351,739 | ||||||||
Purchase of property and equipment | (14,417 | ) | (14,143 | ) | (35,281 | ) | (63,846 | ) | ||||||||
Free cash flow | $ | 164,202 | $ | 94,572 | $ | 297,379 | $ | 287,893 | ||||||||
Note: The 2017 free cash flow numbers
presented in the table above includes
View source version on businesswire.com: https://www.businesswire.com/news/home/20181108005429/en/
Source:
TEGNA Inc.
For investor inquiries, contact:
Jeffrey Heinz
Vice
President, Investor Relations
703-873-6917
jheinz@TEGNA.com
or
For
media inquiries, contact:
Anne Bentley
Vice President,
Corporate Communications
703-873-6366
abentley@TEGNA.com