Gannett Co, a mass media holding company, released its financial results for the third quarter (Q3) ending September 30, 2023, today, revealing a 9.1% decrease in total revenues compared to the same period last year. Following the announcement, Gannett Co.’s stock experienced a sharp decline.
At the time of this publication, Gannett Co Inc stock (GCI) has witnessed a decline.
Gannett Co Inc
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Gannett Q3 2023 Results – Key Highlights:
– Total revenues amounted to $652.9 million, reflecting a 9.1% decrease from the third quarter of 2022.
– Same store revenues showed an 8.4% decrease compared to the third quarter of 2022, slightly improving from an 8.6% decrease in the second quarter of 2023.
– Digital revenues reached $263.6 million, constituting 40.4% of total revenues, a 2.7% increase over the prior year on a same store basis.
– Gannett reported a net loss of $2.6 million, an improvement of $51.5 million from the net loss of $54.1 million in the third quarter of 2022.
– Adjusted EBITDA totaled $59.5 million, marking a 14.7% increase from the third quarter of the previous year.
– Adjusted EBITDA margin saw a notable improvement, increasing by 190 basis points to 9.1% from 7.2% in the third quarter of 2022.
– Operating activities provided $20.6 million in cash, with free cash flow at $7.4 million.
Gannett Q3 2023 Results – Media Highlights:
– Digital-only subscription revenues soared to $40.0 million, exhibiting a substantial 15.9% year-over-year growth and a 16.1% increase on a same store basis.
– A record high digital-only average revenue per user was recorded at $6.82, reflecting a robust 14.0% year-over-year increase.
– Digital-only paid subscriptions rebounded to growth, registering a 0.7% increase from the second quarter of 2023, totaling 1.96 million subscriptions.
– Gannett attracted an average of 189 million monthly unique visitors, with 138 million originating from the USA TODAY NETWORK and 51 million from U.K. digital properties.
Gannett Q3 2023 Results – Digital Marketing Solutions Highlights:
– The Digital Marketing Solutions segment reported revenues of $121.9 million, exhibiting a 1.6% year-over-year growth and a 1.9% increase on a same store basis.
– Total core platform revenues reached $120.8 million, up by 1.8% compared to the same quarter in the prior year.
– The average customer count remained consistent at 15.3 thousand, showing no change sequentially but a 3.2% decrease from the previous year.
– Core platform average revenue per user experienced a 5.0% year-over-year increase, amounting to $2,636.
– Customer budget retention was reported at 95.4%, an increase of 20 basis points from the third quarter of 2022.
– Net income attributable to Gannett in this segment was $5.9 million, with a net income margin of 4.8% in the third quarter of 2023, as compared to 4.5% in the same quarter of the prior year.
– Adjusted EBITDA within the segment was $13.6 million, reflecting a decrease of 13.5% compared to the same period in the prior year. Adjusted EBITDA margin within the segment decreased to 11.1% in the third quarter of 2023 versus 13.1% in the same quarter of the prior year.
Gannett Q3 2023 Results – Capital Structure Highlights as of September 30, 2023:
– Gannett Co. reported cash and cash equivalents of $109.2 million.
– Total debt outstanding was $1,154.5 million, including $665.9 million in first lien debt, resulting in a First Lien Net Leverage of 1.96x, a 26.9% decline from the end of fiscal 2022.
– During the third quarter of 2023, the company successfully repaid $65.3 million of debt.
– Additionally, the Company repurchased approximately $33.5 million of the first lien notes due November 1, 2026 for approximately $29.5 million, representing a discount to par.
– The Company received a waiver from certain lenders under its five-year senior secured term loan facility, reducing the scheduled amortization payment for the quarter ended September 30, 2023 by $13.1 million.
– The Company further repaid $31.8 million of its New Senior Secured Term Loan using proceeds from real estate and other asset sales totaling $29.9 million and its quarterly amortization of $1.9 million.
Post-September 30, 2023:
– The Company continued its debt reduction efforts, repaying an additional $6.2 million of its New Senior Secured Term Loan using proceeds from real estate asset sales.
