UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________
FORM 10-Q
_______________________
x
☒    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2017March 31, 2023
OR
¨
☐    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-6961
___________________________
TEGNA INC.
(Exact name of registrant as specified in its charter)
___________________________
Delaware16-0442930
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
7950 Jones Branch Drive, McLean, Virginia   8350 Broad Street, Suite 2000,22107-0150Tysons,Virginia22102-5151
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code: (703) 873-6600.
(703)873-6600
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common StockTGNANew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x☒ No ¨☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x☒ No ¨☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filerx☒Accelerated filer¨☐
Non-accelerated filer
¨ (Do not check if a smaller reporting company)
☐		Smaller reporting company¨☐
Emerging growth company¨☐


If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.c☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ¨☐ No x☒


The total number of shares of the registrant’s Common Stock, $1 par value, outstanding as of SeptemberApril 30, 20172023 was 215,205,823.
225,028,376.




INDEX TO TEGNA INC.
September 30, 2017March 31, 2023 FORM 10-Q
 
Item No. Page
PART I. FINANCIAL INFORMATION
1.Financial Statements
3
5
6
7
8
9
2.
16
3.
28
4.
28
PART II. OTHER INFORMATION
1.
28
1A.
28
2.
28
3.
28
4.
28
5.
28
6.
29
SIGNATURE
30
2
Item No. Page
 PART I. FINANCIAL INFORMATION 
   
1.Financial Statements 
   
 Condensed Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016
3
   
 Consolidated Statements of Income for the Quarters and Nine Months Ended September 30, 2017 and 2016
5
   
 Consolidated Statements of Comprehensive Income for the Quarters and Nine Months Ended September 30, 2017 and 2016
6
   
 Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2017 and 2016
7
   
 Notes to Condensed Consolidated Financial Statements
8
   
2.Management’s Discussion and Analysis of Financial Condition and Results of Operations
22
   
3.Quantitative and Qualitative Disclosures about Market Risk
33
   
4.
Controls and Procedures
34
   
 PART II. OTHER INFORMATION 
   
1.Legal Proceedings
34
   
1A.Risk Factors
34
   
2.Unregistered Sales of Equity Securities and Use of Proceeds
34
   
3.Defaults Upon Senior Securities
34
   
4.Mine Safety Disclosures
34
   
5.Other Information
34
   
6.Exhibits
35
   
SIGNATURE
36



PART I. FINANCIAL INFORMATION
Item 1. Financial Statements


TEGNA Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
In thousands of dollars (Unaudited)
Sept. 30, 2017 Dec. 31, 2016Mar. 31, 2023Dec. 31, 2022
(Unaudited) (Recast)
ASSETS   ASSETS
Current assets   Current assets
Cash and cash equivalents$383,354
 $15,879
Cash and cash equivalents$683,179 $551,681 
Accounts receivable, net of allowances of $3,222 and $3,404, respectively382,791
 386,074
Accounts receivable, net of allowances of $3,965 and $3,697, respectivelyAccounts receivable, net of allowances of $3,965 and $3,697, respectively637,435 658,318 
Other receivables20,384
 20,685
Other receivables10,906 13,493 
Syndicated programming rightsSyndicated programming rights32,578 44,064 
Prepaid expenses and other current assets80,201
 62,090
Prepaid expenses and other current assets35,915 36,152 
Current discontinued operations assets—
 305,960
Total current assets866,730
 790,688
Total current assets1,400,013 1,303,708 
Property and equipment   Property and equipment
Cost801,791
 805,349
Cost1,068,582 1,067,191 
Less accumulated depreciation(456,768) (430,028)Less accumulated depreciation(623,452)(610,138)
Net property and equipment345,023
 375,321
Net property and equipment445,130 457,053 
Intangible and other assets   Intangible and other assets
Goodwill2,579,417
 2,579,417
Goodwill2,981,587 2,981,587 
Indefinite-lived and amortizable intangible assets, less accumulated amortization1,278,667
 1,294,839
Indefinite-lived and amortizable intangible assets, less accumulated amortization of $250,187 and $348,087, respectively
Indefinite-lived and amortizable intangible assets, less accumulated amortization of $250,187 and $348,087, respectively
2,368,858 2,381,606 
Right-of-use assets for operating leasesRight-of-use assets for operating leases75,860 78,448 
Investments and other assets173,219
 180,616
Investments and other assets122,594 126,494 
Noncurrent discontinued operations assets—
 3,321,844
Total intangible and other assets4,031,303
 7,376,716
Total intangible and other assets5,548,899 5,568,135 
Total assets$5,243,056
 $8,542,725
Total assets$7,394,042 $7,328,896 
The accompanying notes are an integral part of these condensed consolidated financial statements.

3


TEGNA Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
In thousands of dollars, except par value and share amounts
(Unaudited)
Mar. 31, 2023Dec. 31, 2022
Sept. 30, 2017 Dec. 31, 2016
(Unaudited) (Recast)
LIABILITIES AND EQUITY   
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND EQUITYLIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND EQUITY
Current liabilities   Current liabilities
Accounts payable$102,758
 $99,568
Accounts payable$88,312 $76,212 
Accrued liabilities219,701
 200,417
Accrued liabilities
Dividends payable15,190
 30,178
Income taxes14,304
 11,448
Current portion of long-term debt280,646
 646
Current discontinued operations liabilities—
 276,924
Compensation Compensation40,647 50,339 
Interest Interest12,798 45,480 
Contracts payable for programming rights Contracts payable for programming rights111,318 117,743 
Other Other73,560 78,265 
Income taxes payableIncome taxes payable51,561 22,985 
Total current liabilities632,599
 619,181
Total current liabilities378,196 391,024 
Noncurrent liabilities   Noncurrent liabilities
Income taxes19,711
 22,644
Deferred income taxes585,173
 648,920
Deferred income tax liabilityDeferred income tax liability557,387 556,131 
Long-term debt3,035,166
 4,042,749
Long-term debt3,070,164 3,069,316 
Pension liabilities168,024
 187,290
Pension liabilities73,550 73,684 
Operating lease liabilitiesOperating lease liabilities76,674 79,503 
Other noncurrent liabilities96,508
 75,438
Other noncurrent liabilities69,052 70,098 
Noncurrent discontinued operations liabilities—
 347,233
Total noncurrent liabilities3,904,582
 5,324,274
Total noncurrent liabilities3,846,827 3,848,732 
Total liabilities4,537,181
 5,943,455
Total liabilities4,225,023 4,239,756 
   
Redeemable noncontrolling interests related to discontinued operations—
 46,265
Commitments and contingent liabilities (see Note 9)Commitments and contingent liabilities (see Note 9)
   
Equity   
TEGNA Inc. shareholders’ equity   
Redeemable noncontrolling interest (see Note 1)Redeemable noncontrolling interest (see Note 1)17,754 17,418 
Shareholders’ equityShareholders’ equity
Common stock of $1 par value per share, 800,000,000 shares authorized, 324,418,632 shares issued324,419
 324,419
Common stock of $1 par value per share, 800,000,000 shares authorized, 324,418,632 shares issued324,419 324,419 
Additional paid-in capital390,886
 473,742
Additional paid-in capital27,941 27,941 
Retained earnings5,777,443
 7,384,556
Retained earnings7,879,619 7,898,055 
Accumulated other comprehensive loss(121,073) (161,573)Accumulated other comprehensive loss(124,455)(125,533)
Less treasury stock at cost, 109,212,809 shares and 109,930,832 shares, respectively(5,665,800) (5,749,726)
Total TEGNA Inc. shareholders’ equity705,875
 2,271,418
Noncontrolling interests related to discontinued operations—
 281,587
Less treasury stock at cost, 99,471,855 shares and 100,970,426 shares, respectivelyLess treasury stock at cost, 99,471,855 shares and 100,970,426 shares, respectively(4,956,259)(5,053,160)
Total equity705,875
 2,553,005
Total equity3,151,265 3,071,722 
Total liabilities, redeemable noncontrolling interests and equity$5,243,056
 $8,542,725
Total liabilities, redeemable noncontrolling interest and equityTotal liabilities, redeemable noncontrolling interest and equity$7,394,042 $7,328,896 
The accompanying notes are an integral part of these condensed consolidated financial statements.






4

TEGNA Inc.
CONSOLIDATED STATEMENTS OF INCOME
Unaudited, in thousands of dollars, except per share amounts
 Quarter ended
Sept. 30,		 Nine months ended
Sept. 30,
 2017 2016 2017 2016
   (recast)   (recast)
        
Revenues$464,264
 $519,617
 $1,412,703
 $1,457,233
        
Operating expenses:       
Cost of revenues, exclusive of depreciation235,474

200,495
 696,565

590,058
Business units - Selling, general and administrative expenses, exclusive of depreciation70,914

83,039
 214,645

246,280
Corporate - General and administrative expenses, exclusive of depreciation12,881
 16,027
 42,462
 43,865
Depreciation15,186

13,212
 41,721

42,653
Amortization of intangible assets5,395

5,775
 16,172

17,542
Asset impairment and facility consolidation charges7,553

15,218
 11,086

18,946
Total347,403
 333,766
 1,022,651
 959,344
Operating income116,861
 185,851
 390,052
 497,889
        
Non-operating income (expense):       
Equity income (loss) in unconsolidated investments, net866
 (1,198) (1,549) (2,763)
Interest expense(51,855) (57,601) (162,113) (175,444)
Other non-operating items(3,671) (11,874) (26,853) (16,029)
Total(54,660)
(70,673) (190,515)
(194,236)
        
Income before income taxes62,201
 115,178
 199,537
 303,653
Provision for income taxes11,447

38,441
 54,855

92,038
Net Income from continuing operations50,754
 76,737
 144,682
 211,615
(Loss) income from discontinued operations, net of tax(10,803) 56,698
 (233,261) 132,141
Net income (loss)39,951
 133,435
 (88,579) 343,756
Net loss (income) attributable to noncontrolling interests from discontinued operations2,806
 (14,752) 58,698

(40,178)
Net income (loss) attributable to TEGNA Inc.$42,757
 $118,683
 $(29,881) $303,578
        
Earnings from continuing operations per share - basic$0.24
 $0.36
 $0.67

$0.98
(Loss) earnings from discontinued operations per share - basic(0.04) 0.19
 (0.81) 0.42
Net income (loss) per share – basic$0.20
 $0.55
 $(0.14) $1.40
        
Earnings from continuing operations per share - diluted$0.23
 $0.35
 $0.66

$0.96
(Loss) earnings from discontinued operations per share - diluted(0.04) 0.19
 (0.80) 0.42
Net income (loss) per share – diluted$0.19
 $0.54
 $(0.14) $1.38
        
Weighted average number of common shares outstanding:       
Basic shares215,863
 214,813
 215,558
 216,865
Diluted shares218,095
 218,099
 217,827
 220,511
        
Dividends declared per share$0.07
 $0.14
 $0.28
 $0.42
Quarter ended Mar. 31,
20232022
Revenues$740,327 $774,123 
Operating expenses:
Cost of revenues1
426,932 411,450 
Business units - Selling, general and administrative expenses99,109 101,969 
Corporate - General and administrative expenses12,100 21,320 
Depreciation15,049 15,305 
Amortization of intangible assets13,582 15,000 
Spectrum repacking reimbursements and other, net— (58)
Total566,772 564,986 
Operating income173,555 209,137 
Non-operating (expense) income:
Equity loss in unconsolidated investments, net(237)(3,811)
Interest expense(42,906)(43,620)
Other non-operating items, net5,411 17,319 
Total(37,732)(30,112)
Income before income taxes135,823 179,025 
Provision for income taxes31,819 44,738 
Net Income104,004 134,287 
Net loss (income) attributable to redeemable noncontrolling interest299 (53)
Net income attributable to TEGNA Inc.$104,303 $134,234 
Earnings per share:
Basic$0.46 $0.60 
Diluted$0.46 $0.60 
Weighted average number of common shares outstanding:
Basic shares224,544 222,712 
Diluted shares224,839 223,240 
1 Cost of revenues exclude charges for depreciation and amortization expense, which are shown separately above.
The accompanying notes are an integral part of these condensed consolidated financial statements.

5


TEGNA Inc.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Unaudited, in thousands of dollars
 Quarter ended Sept. 30, Nine months ended Sept. 30,
 2017 2016 2017 2016
        
Net income (loss)$39,951
 $133,435
 $(88,579) $343,756
Redeemable noncontrolling interests (earnings not available to shareholders)36
 (1,353) (2,797) (3,628)
Other comprehensive income (loss), before tax:       
Foreign currency translation adjustments24,764
 (1,973) 34,126
 (7,934)
Recognition of previously deferred post-retirement benefit plan costs2,201
 1,763
 6,603
 6,085
Unrealized (losses) gains on available for sale investment during the period—
 (3,743) 1,776
 (8,017)
Other comprehensive income (loss), before tax26,965
 (3,953) 42,505
 (9,866)
Income tax effect related to components of other comprehensive income (loss)(752) (688) (2,445) (2,368)
Other comprehensive income (loss), net of tax26,213
 (4,641) 40,060
 (12,234)
Comprehensive income (loss)66,200
 127,441
 (51,316) 327,894
Comprehensive income (loss) attributable to noncontrolling interests, net of tax1,360
 (12,470) 55,676
 (32,813)
Comprehensive income attributable to TEGNA Inc.$67,560
 $114,971
 $4,360
 $295,081
Quarter ended Mar. 31,
20232022
Net income$104,004 $134,287 
Other comprehensive income, before tax:
Foreign currency translation adjustments— 142 
Recognition of previously deferred post-retirement benefit plan costs1,450 975 
Realized gain on available-for-sale investment during the period— (20,800)
Other comprehensive income (loss), before tax1,450 (19,683)
Income tax effect related to components of other comprehensive income(372)5,065 
Other comprehensive income (loss), net of tax1,078 (14,618)
Comprehensive income105,082 119,669 
Comprehensive loss (income) attributable to redeemable noncontrolling interest299 (53)
Comprehensive income attributable to TEGNA Inc.$105,381 $119,616 
The accompanying notes are an integral part of these condensed consolidated financial statements.



6

TEGNA Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Unaudited, in thousands of dollars

 Nine months ended Sept. 30,
 2017 2016
    
Cash flows from operating activities:   
Net (loss) income$(88,579) $343,756
Adjustments to reconcile net income to net cash flow from operating activities:   
Depreciation and amortization117,762
 153,197
Stock-based compensation14,189
 13,216
Loss on sale of CareerBuilder342,900
 —
Other losses on sales of assets and impairment charges19,803
 24,082
Equity losses in unconsolidated investments, net1,488
 6,530
Pension (contributions), net of expense(12,547) 2,135
Spectrum channel share agreement proceeds32,588
 —
Change in other assets and liabilities, net(76,421) (88,153)
Net cash flow from operating activities351,183
 454,763
Cash flows from investing activities:   
Purchase of property and equipment(63,846) (68,577)
Payments for acquisitions of businesses, net of cash acquired—
 (196,751)
Payments for investments(2,778) (19,132)
Proceeds from sale of CareerBuilder, net of $36,581 cash transferred198,342
 —
Proceeds from investments15,122
 10,127
Proceeds from sale of assets5,659
 1,024
Net cash flow from (used for) investing activities152,499
 (273,309)
Cash flows from financing activities:   
(Payments) proceeds of borrowings under revolving credit facilities, net(635,000) 10,000
Proceeds from Cars.com borrowings675,000
 —
Proceeds from other borrowings—
 300,000
Debt repayments(99,185) (249,592)
Payments of debt issuance costs(6,208) (1,684)
Dividends paid(75,109) (91,627)
Repurchases of common stock(8,453) (150,917)
Distributions to noncontrolling membership interests(22,980) —
Cash transferred to the Cars.com business(20,133) —
Other, net(5,180) (19,505)
Net cash flow used for financing activities(197,248) (203,325)
Increase (decrease) in cash and cash equivalents306,434
 (21,871)
Cash and cash equivalents from continuing operations, beginning of period15,879
 26,096
Cash and cash equivalents from discontinued operations, beginning of period61,041
 103,104
Balance of cash and cash equivalents, beginning of period76,920
 129,200
Cash and cash equivalents from continuing operations, end of period383,354
 19,185
Cash and cash equivalents from discontinued operations, end of period—
 88,144
Balance of cash and cash equivalents, end of period$383,354
 $107,329
    
Supplemental cash flow information:   
Cash paid for income taxes, net of refunds$104,422
 $145,052
Cash paid for interest$133,752
 $153,510

Three months ended Mar. 31,
20232022
Cash flows from operating activities:
Net income$104,004 $134,287 
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation and amortization28,631 30,305 
Stock-based compensation3,688 10,495 
     Company stock 401(k) contribution5,564 5,338 
Gains on assets, net— (18,308)
Equity losses from unconsolidated investments, net237 3,811 
Pension expense, net of employer contributions1,416 (585)
Change in other assets and liabilities, net of acquisitions:
Decrease (increase) in trade receivables20,615 (120)
Increase in accounts payable12,100 13,987 
(Decrease) increase in interest and taxes payable, net(1,627)13,663 
Increase in deferred revenue1,797 2,298 
Change in other assets and liabilities, net(6,038)1,089 
Net cash flow from operating activities170,387 196,260 
Cash flows from investing activities:
Purchase of property and equipment(2,845)(5,538)
Reimbursements from spectrum repacking— 58 
Payments for acquisition of assets(1,150)— 
Purchases of investments(163)(2,216)
Proceeds from investments23 — 
Proceeds from sale of assets13 366 
Net cash flow used for investing activities(4,122)(7,330)
Cash flows from financing activities:
Payments under revolving credit facilities, net— (166,000)
Dividends paid(21,360)(21,151)
 Other, net(13,407)(15,452)
Net cash flow used for financing activities(34,767)(202,603)
Increase (decrease) in cash131,498 (13,673)
Balance of cash, beginning of period551,681 56,989 
Balance of cash, end of period$683,179 $43,316 
Supplemental cash flow information:
Cash paid (received) for income taxes, net of refunds (payments)$914 $(248)
Cash paid for interest$73,862 $75,063 
The accompanying notes are an integral part of these condensed consolidated financial statements.

7


TEGNA Inc.
CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTEREST
Unaudited, in thousands of dollars, except per share data
Quarters ended:Redeemable noncontrolling interestCommon
stock		Additional
paid-in
capital		Retained
earnings		Accumulated
other
comprehensive
loss		Treasury
stock		Total Equity
Balance at Dec. 31, 2022$17,418 $324,419 $27,941 $7,898,055 $(125,533)$(5,053,160)$3,071,722 
Net (loss) income(299)— — 104,303 — — 104,303 
Other comprehensive income, net of tax— — — — 1,078 — 1,078 
Total comprehensive income105,381 
Dividends declared: $0.095 per share— — — (21,360)— — (21,360)
Company stock 401(k) contribution— — (575)(14,491)— 20,630 5,564 
Stock-based awards activity— — (3,425)(86,253)— 76,271 (13,407)
Stock-based compensation— — 3,688 — — — 3,688 
Adjustment of redeemable noncontrolling interest to redemption value635 — — (635)— — (635)
Other activity— — 312 — — — 312 
Balance at Mar. 31, 2023$17,754 $324,419 $27,941 $7,879,619 $(124,455)$(4,956,259)$3,151,265 
Redeemable noncontrolling interestCommon
stock		Additional
paid-in
capital		Retained
earnings		Accumulated
other
comprehensive
loss		Treasury
stock		Total Equity
Balance at Dec. 31, 2021$16,129 $324,419 $27,941 $7,459,380 $(97,216)$(5,194,618)$2,519,906 
Net income53 — — 134,234 — — 134,234 
Other comprehensive income, net of tax— — — — (14,618)— (14,618)
Total comprehensive income119,616 
Dividends declared: $0.095 per share— — — (21,150)— — (21,150)
Company stock 401(k) contribution— — (1,322)(11,275)— 17,935 5,338 
Stock-based awards activity— — (9,517)(81,146)— 75,211 (15,452)
Stock-based compensation— — 10,495 — — — 10,495 
Adjustment of redeemable noncontrolling interest to redemption value248 — — (248)— — (248)
Other activity— — 344 — — — 344 
Balance at Mar. 31, 2022$16,430 $324,419 $27,941 $7,479,795 $(111,834)$(5,101,472)$2,618,849 
The accompanying notes are an integral part of these condensed consolidated financial statements.

8

TEGNA Inc.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 – Basis of presentation, merger agreement and accounting policies


Basis of presentation: Our accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial reporting, the instructions for Form 10-Q and Article 10 of the U.S. Securities and Exchange Commission (SEC) Regulation S-X. Accordingly, they do not include all information and footnotes which are normally included in the Form 10-K and annual report to shareholders. In our opinion, the condensed consolidated financial statements reflect all adjustments of a normal recurring nature necessary for a fair presentationstatement of the results for the interim periods presented. The condensed consolidated financial statements should be read in conjunction with our (or “TEGNA’s”)TEGNA’s) audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2016.2022.


The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. We use the best information available in developing significant estimates inherent in our financial statements. Actual results could differ from these estimates.estimates, and these differences resulting from changes in facts and circumstances could be material. Significant estimates include, but are not limited to, evaluation of goodwill and other intangible assets for impairment, fair value measurements, post-retirement benefit plans, income taxes including deferred taxes, and contingencies. The condensed consolidated financial statements include the accounts of subsidiaries we control and variable interest entities (VIEs) if we are the primary beneficiary.control. We eliminate all intercompany balances, transactions, and profits in consolidation. Investments in entities over which we have significant influence, but do not have control, are accounted for under the equity method. Our share of net earnings and losses from these ventures is included in “Equity (loss) incomeloss in unconsolidated investments, net” in the Consolidated Statements of Income. In addition,

We operate one operating and reportable segment, which primarily consists of our 64 television stations and two radio stations operating in 51 markets, providing high-quality television programming and digital content. Our reportable segment determination is based on our management and internal reporting structure, the nature of products and services we offer, and the financial information that is evaluated regularly by our chief operating decision maker.

Merger Agreement: On February 22, 2022, we entered into an Agreement and Plan of Merger (as amended, the Merger Agreement), with Teton Parent Corp., a newly formed Delaware corporation (Parent), Teton Merger Corp., a newly formed Delaware corporation and an indirect wholly owned subsidiary of Parent (Merger Sub), and solely for purposes of certain reclassifications have been madeprovisions specified therein, other subsidiaries of Parent, certain affiliates of Standard General L.P., a Delaware limited partnership (Standard General) and CMG Media Corporation, a Delaware corporation (CMG), and certain of its subsidiaries. Parent, Merger Sub, the other subsidiaries of Parent, those affiliates of Standard General, CMG and those subsidiaries of CMG, are collectively, referred to prior years’ consolidated Statements of Income to conformas the “Parent Restructuring Entities.”

The Merger Agreement provides, among other things and subject to the current year’s presentation.terms and conditions set forth therein, that Merger Sub will be merged with and into TEGNA (the Merger), with TEGNA continuing as the surviving corporation and as an indirect wholly owned subsidiary of Parent. The Merger Agreement provides that each share of common stock, par value $1.00 per share, of TEGNA (the Common Stock) outstanding immediately prior to the effective time of the Merger (the Effective Time), other than certain excluded shares, will at the Effective Time automatically be converted into the right to receive (i) $24.00 per share of Common Stock in cash, without interest, plus (ii) additional amounts in cash, without interest, if the Merger does not close within a certain period of time after the date of the Merger Agreement. TEGNA shareholders will receive additional cash consideration in the form of a “ticking fee” of (a) if the Closing Date occurs after November 22, 2022 and before February 22, 2023, an amount in cash equal to (i) $0.00166667 multiplied by (ii) the number of calendar days elapsed after November 22, 2022 to and including the Closing Date, (b) if the Closing Date occurs on or after February 22, 2023 and before March 22, 2023, an amount in cash equal to (i) $0.15333333 plus (ii)(A) $0.0025 multiplied by (B) the number of calendar days elapsed after February 22, 2023 to and including the Closing Date, (c) if the Closing Date occurs on or after March 22, 2023 and before April 22, 2023, an amount in cash equal to (i) $0.22333333 plus (ii)(A) $0.00333333 multiplied by (B) the number of calendar days elapsed after March 22, 2023 to and including the Closing Date and (d) if the Closing Date occurs on or after April 22, 2023 and before May 22, 2023, an amount in cash equal to (i) $0.3266667 plus (ii)(A) $0.00416667 multiplied by (B) the number of calendar days elapsed after April 22, 2023 to and including the Closing Date.


The Merger Agreement contains certain termination rights and provides that, upon termination of the Merger Agreement under certain specified circumstances, Parent will be required to pay TEGNA a termination fee of either $136.0 million or $272.0 million.

TEGNA has made customary representations, warranties and covenants in the Merger Agreement. If the Merger is consummated, the Common Stock will be delisted from the New York Stock Exchange and deregistered under the Securities Exchange Act of 1934.

9

On March 10, 2022, TEGNA, Parent, Merger Sub, and, solely for purposes of certain provisions specified therein, the other Parent Restructuring Entities, entered into an amendment to the Merger Agreement (the Amendment). The Amendment provides, among other things and subject to the terms and conditions set forth therein, that certain regulatory efforts covenants will apply with respect to certain station transfers from Parent or an affiliate of Parent to CMG or an affiliate of CMG that are contemplated to be consummated as of immediately following the Effective Time.

On May 31, 2017, we completed17, 2022 the spin-offstockholders of our digital automotive marketplace business, Cars.com. In addition,TEGNA voted to adopt the Merger Agreement. On February 21, 2023, TEGNA elected, pursuant to the terms of the Merger Agreement, to extend the Outside Date (as defined in the Merger Agreement) from 5:00 p.m. Eastern time on July 31, 2017, we completedFebruary 22, 2023 to 5:00 p.m. Eastern time on May 22, 2023. All waiting periods under the saleHart-Scott-Rodino Antitrust Improvements Act of our majority ownership stake in CareerBuilder. Our digital marketing services (DMS) business1976, as amended, applicable to the Merger and related transactions have expired. The closing of the Merger remains subject to the approval of the Federal Communications Commission (the “FCC”) and customary closing conditions. On February 24, 2023, the FCC issued a hearing designation order (the “HDO”) with respect to the transaction. On March 27, 2023, certain of the parties to the Merger Agreement filed a notice of appeal of the HDO and a petition for a writ of mandamus with the United States Court of Appeals for the District of Columbia Circuit (the “D.C. Court of Appeals”). On April 3, 2023, the D.C. Court of Appeals dismissed the appeal of the HDO. On April 21, 2023, the D.C. Court of Appeals denied the petition for a writ mandamus. TEGNA is now reported within our Media business. As a result of these strategic actions, we have disposed of substantially all of our Digital Segment business and have therefore classifiedcurrently evaluating its historical financial results as discontinued operations. See Note 12, “Discontinued Operations”, for further details regarding the spin-off of Cars.com and the sale of CareerBuilder and the impact of each transaction on our condensed consolidated financial statements.options.


Accounting guidance adopted in 2017: In March 2017, the Financial Accounting Standards Board (FASB) issued2023: We did not adopt any newaccounting guidance in 2023 that had a material impact on our consolidated financial statements or disclosures.

New accounting guidance not yet adopted: There is currently no pending accounting guidance that changes the presentation of net periodic pension and other post-retirement benefit costs (post-retirement benefit costs) in the Consolidated Statements of Income. Under this new guidance, the service cost component of the post-retirement benefit expense will continuewe expect to be presented as an operating expense while all other components of post-retirement benefit expense will be presented as non-operating expense. Previously, all components of post-retirement benefit expense were presented as operating expense in the Consolidated Statements of Income. The FASB permitted early adoption of this guidance, and we elected to early adopt in the first quarter of 2017. We believe the new guidance provides enhanced financial reporting by limiting operating expense classification to the service cost component of post-retirement benefit expense. Service cost is the component of the expense that relates to services provided by employees in the current period and thus better reflects the current continuing operating costs. Changes to the classification of Consolidated Statements of Income amounts resulting from the new guidance were made on a retrospective basis, wherein each period presented was adjusted to reflect the effects of applying the new guidance. We utilized amounts previously disclosed in our retirement plan footnote to retrospectively apply the guidance. As a result of adopting this guidance, operating expenses in the third quarter and for the first nine months of 2017 were lower by $1.7 million and $4.9 million, respectively, while non-operating expenses were higher by the same amounts. In 2016, operating expenses in the third quarter and first nine months were reduced by $1.8 million and $5.8 million, respectively, with corresponding increases in non-operating expenses as a result of adopting this new guidance. Net income, earnings per share, and retained earnings were not impacted by the new guidance.

In January 2017, the FASB issued guidance that eliminates the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of the goodwill impairment test) to measure a goodwill impairment charge. Instead, companies will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on Step 1 of the impairment test). The FASB permitted early adoption of this guidance, and we elected to early adopt in the second quarter of 2017 in connection with the calculation of CareerBuilder’s goodwill impairment charge, discussed in Note 12.

New accounting pronouncements not yet adopted: In May 2014, the FASB issued new guidance related to revenue recognition. Under the new guidance, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the guidance requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers.

We will adopt the guidance beginning January 1, 2018. The two permitted transition methods are the full retrospective method, in which case the guidance would be applied to each prior reporting period presented and the cumulative effect of applying the guidance would be recognized at the earliest period shown; and the modified retrospective method, in which case


the cumulative effect of applying the guidance would be recognized at the date of initial application. We will adopt the guidance using the modified retrospective method.

While we continue to evaluate the full impact of the guidance, we do not believe that it will have a material impact on our consolidated financial statements.statements or disclosures.

Trade receivables and allowances for doubtful accounts: Trade receivables are recorded at invoiced amounts and generally do not bear interest. The allowance for doubtful accounts reflects our estimate of credit exposure, determined principally on the basis of our collection experience, aging of our receivables and any specific reserves needed for certain customers based on their credit risk. Our allowance also takes into account expected future trends which may impact our customers’ ability to pay, such as economic growth (or declines), unemployment and demand for our products and services. We aremonitor the credit quality of our customers and their ability to pay through the use of analytics and communication with individual customers. As of March 31, 2023, our allowance for doubtful accounts was $4.0 million as compared to $3.7 million as of December 31, 2022.

Redeemable Noncontrolling interest: Our Premion business operates an advertising network for over-the-top (OTT) streaming and connected television platforms. In March 2020, we sold a minority interest in Premion to an affiliate of Gray Television (Gray) and entered into a commercial reselling agreement with the affiliate. During the first quarter of 2023, we entered into a multi-year extension of the reselling agreement with Gray. Gray’s investment allows it to sell its interest to Premion if there is a change in control of TEGNA or if the commercial agreement terminates. Since redemption of the minority ownership interest is outside our control, Gray’s equity interest is presented outside of the Equity section on the Condensed Consolidated Balance Sheet in the processcaption “Redeemable noncontrolling interest.”

Treasury Stock: We account for treasury stock under the cost method. When treasury stock is re-issued at a price higher than its cost, the difference is recorded as a component of evaluatingadditional paid-in-capital (APIC) in our Condensed Consolidated Balance Sheets. When treasury stock is re-issued at a price lower than its cost, the other requirementsdifference is recorded as a component of APIC to the new standard,extent that there are previously recorded gains to offset the losses. If there are no treasury stock gains in APIC, the losses upon re-issuance of treasury stock are recorded as a reduction of retained earnings in our Condensed Consolidated Balance Sheets.

Revenue recognition: Revenue is recognized upon the transfer of control of promised services to our customers in an amount that reflects the consideration we expect to receive in exchange for those services. Revenue is recognized net of any taxes collected from customers, which may resultare subsequently remitted to governmental authorities. Amounts received from customers in additional revenue related disclosures.advance of providing services to our customers are recorded as deferred revenue.


Based on our evaluation performed to date, we believe that 90%The primary sources of our revenues will not be materially impactedare: 1) subscription revenues, reflecting fees paid by satellite, cable, OTT (companies that deliver video content to consumers over the new guidance. Specifically,Internet) and telecommunications providers to carry our television spotsignals on their systems; 2) advertising contracts,& marketing services revenues, which comprised approximately 60% of 2016 revenueinclude local and national non-political television advertising, digital marketing services (including Premion), advertising on the stations’ websites, tablet and mobile products, and OTT apps; 3) political advertising revenues, which are short-term in nature with transaction price consideration agreed upon in advance. We expect revenue will continue to be recognized when commercials are aired. Further, we expect that subscription revenue earned under retransmission agreements will be recognized underdriven by even-year election cycles at the licensing of intellectual property guidancelocal and national level (e.g. 2024, 2022, etc.) and particularly in the standard, which will not have a material change to our current revenue recognition. Subscription revenue comprised approximately 30%second half of 2016 revenue. We continue to evaluate the impact to our online digitalthose years; and 4) other services, revenue (which represents approximately 10%such as production of programming, tower rentals and distribution of our revenues).local news content.


In February 2016, the FASB issued new guidance related to leases which will require lessees to recognize assets and liabilities on the balance sheet for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease
10

Revenue earned by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP—which requires only capital leases to be recognized on the balance sheet—the new guidance will require both types of leases to be recognized on the balance sheet. The new guidance is effective for us beginningthese sources in the first quarter of 20192023 and will be adopted using a modified retrospective approach. We2022 are currently evaluating the effect it is expected to have on our consolidated financial statements and related disclosures.shown below (amounts in thousands):

Quarter ended Mar. 31,
20232022
Subscription$414,280 $391,654 
Advertising & Marketing Services307,845 354,467 
Political5,291 17,965 
Other12,911 10,037 
Total revenues$740,327 $774,123 
In June 2016, the FASB issued new guidance related to the measurement of credit losses on financial instruments. The new guidance changes the way credit losses on accounts receivable are estimated. Under current GAAP, credit losses on accounts receivable are recognized once it is probable that such losses will occur. Under the new guidance, we will be required to estimate credit losses based on the expected amount of future collections which may result in earlier recognition of allowance for doubtful accounts. The new guidance is effective for public companies beginning in the first quarter of 2020 and will be adopted using a modified retrospective approach. We are currently evaluating the effect this new guidance will have on our consolidated financial statements and related disclosures.
In August 2016, the FASB issued new guidance which clarifies several specific cash flow classification issues. The objective of the new guidance is to reduce the existing diversity in practice in how these cash flows are presented in the statement of cash flows. The standard is effective for us beginning in the first quarter of 2018 and early adoption is permitted. One classification change we will make when we adopt the standard relates to payments made for premiums, fees paid to lenders and other related third party costs when debt is repaid early. Under the new guidance these payments will be classified as financing cash outflows (we have historically classified these types of cash payments as operating outflows).
NOTE 2 – Goodwill and other intangible assets
The following table displays goodwill, indefinite-lived intangible assets, and amortizable intangible assets as of September 30, 2017March 31, 2023 and December 31, 20162022 (in thousands):
Mar. 31, 2023Dec. 31, 2022
GrossAccumulated AmortizationGrossAccumulated Amortization
Goodwill$2,981,587 $— $2,981,587 $— 
Indefinite-lived intangibles:
Television and radio station FCC broadcast licenses2,124,731 — 2,123,898 — 
Amortizable intangible assets:
Retransmission agreements113,621 (79,311)224,827 (184,796)
Network affiliation agreements309,503 (127,457)309,503 (121,664)
Other71,190 (43,419)71,465 (41,627)
Total indefinite-lived and amortizable intangible assets$2,619,045 $(250,187)$2,729,693 $(348,087)
 Sept. 30, 2017 Dec. 31, 2016
 Gross Accumulated Amortization Gross Accumulated Amortization
     (recast) (recast)
Goodwill$2,579,417
 $—
 $2,579,417
 $—
Indefinite-lived intangibles:       
Television station FCC licenses1,191,950
 —
 1,191,950
 —
Amortizable intangible assets:       
Retransmission agreements110,191
 (58,586) 110,191
 (47,280)
Network affiliation agreements43,485
 (18,139) 43,485
 (14,445)
Other15,763
 (5,997) 15,763
 (4,825)
Total indefinite-lived and amortizable intangible assets$1,361,389
 $(82,722) $1,361,389
 $(66,550)


Our retransmission agreements and network affiliation agreements are amortized on a straight-line basis over their estimated useful lives. Other intangibles primarily include customer relationshipsdistribution agreements from our multicast networks acquisition, which are also amortized on a straight-line basis overover their useful lives. DuringIn the secondfirst quarter of 2017, we recorded a goodwill impairment charge within discontinued operations related2023, gross retransmission agreement intangible assets and associated accumulated amortization decreased by $111.2 million, due to our former CareerBuilder reporting unit. See Note 12 for further discussion.certain retransmission intangible assets reaching the end of their useful lives.




NOTE 3 – Investments and other assets


Our investments and other assets consisted of the following as of September 30, 2017,March 31, 2023 and December 31, 20162022 (in thousands):
Mar. 31, 2023Dec. 31, 2022
Cash value insurance$49,552 $48,919 
Equity method investments16,928 17,003 
Other equity investments20,158 20,158 
Deferred debt issuance costs1,341 2,232 
Long-term contract assets12,925 14,135 
Other long-term assets21,690 24,047 
Total$122,594 $126,494 

Cash value life insurance: We are the beneficiary of life insurance policies on the lives of certain employees/retirees, which are recorded at their cash surrender value as determined by the insurance carrier. These policies are utilized as a partial funding source for deferred compensation and other non-qualified employee retirement plans. Gains and losses on these investments are included in “Other non-operating items, net” within our Consolidated Statement of Income and were not material for all periods presented.
11

 Sept. 30, 2017 Dec. 31, 2016
   (recast)
Cash value life insurance$60,873
 $64,134
Deferred compensation investments28,593
 23,715
Equity method investments35,599
 18,016
Available for sale investment—
 16,744
Deferred debt issuance cost7,008
 9,856
Other long term assets41,146
 48,151
Total$173,219
 $180,616


Other equity investments: Represents investments in non-public businesses that do not have readily determinable pricing, and for which we do not have control or do not exert significant influence. These investments are recorded at cost less impairments, if any, plus or minus changes in observable prices for those investments.

Deferred compensation investmentsdebt issuance costs: Employee compensation-related investmentsThese costs consist of debt and equity securities which are classified as trading securities and fundamounts paid to lenders related to our deferred compensation plan liabilities.

Equity method investments:Investments over which we have the ability to exercise significant influence but do not control,revolving credit facility. Debt issuance costs paid for our unsecured notes are accounted for under the equity method of accounting. Significant influence typically exists when we own between 20% and 50% of the voting interests inas a corporation, own more than a minimal investment in a limited liability company, or hold substantial management rightsreduction in the investee. Under this method of accounting, our share of the net earnings or losses of the investee is included in non-operating income on our Consolidated Statements of Income. We evaluate our equity method investments for impairment whenever events or changes in circumstances indicate that the carryingdebt obligation.

Long-term contract assets: These amounts of such investments may be impaired. If a decline in the valueprimarily consist of an equity method investment is determinedasset related to be other than temporary, a loss equal tolong-term services agreement for IT security and an asset representing the excess of carrying value over fair value is recorded in earnings in the current period.Certain differences exist between our investment carrying value and the underlying equity of the investee companies, principally due to fair value measurement at the date of investment acquisition and due to impairment charges we recorded for certain investments. As part of the agreement to sell the majority of CareerBuilder, we retained an investment of approximately 17% (or approximately 12% on a fully-diluted basis) in the entity. Our ownership stake provides us with two seats on CareerBuilder’s board of directors and thus we concluded that we have significant influence over the entity and have classified our investment as an equity method investment. In the third quarter of 2017, we recorded $0.5 million of equity earnings from our CareerBuilder investment.

On October 18, 2017, we closed on the sale of our equity investment in Livestream, a business specializing in live video streaming. Our share of the sale proceeds was $21.4 million.

Available for sale investment: Our investment in Gannett Co., Inc., common stock, was sold in its entirety during the third quarter of 2017. Proceeds from the sale were $14.6 million and for the three months and nine months ended September 30, 2017 we recorded losses of $0.4 million and $3.9 million, respectively. These losses are reflected in the Other non-operating items, in the accompanying Consolidated Statements of Income.

Other long term assets: During the second quarter of 2017, we recognized a $5.8 million loss associated with a write-offlong-term portion of a note receivable from one of our equity method investments. This loss is reflectedcontract asset related to favorable rates obtained on commercial agreements with Madhive. The contract asset was recognized in Other non-operating items, in the accompanying Consolidated Statements of Income. The loss was a result of a decision made during the second quarter of 2017 by the investee’s board of directors to discontinue the business, and the investee not having sufficient funds to repay the full note at that time.

Cost method investments: The carrying value of cost method investments was $15.3 million as of September 30, 2017 and $14.8 million as of December 31, 2016,January 2022 and is included within other long term assets in the table above.being amortized over two years (through December 2023). See Note 9 for information regarding our related party transactions with MadHive.
NOTE 4 – Income taxes
The total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was approximately $9.7 million as of September 30, 2017, and $10.8 million as of December 31, 2016. The amount of accrued interest and penalties payable related to unrecognized tax benefits was $1.2 million as of September 30, 2017, and $1.5 million as of December 31, 2016.
It is reasonably possible that the amount of unrecognized benefits with respect to certain of our unrecognized tax positions will increase or decrease within the next 12 months. These changes may be the result of settlement of ongoing audits, lapses of statutes of limitations or other regulatory developments. At this time, we estimate the amount of gross unrecognized tax positions may be reduced by up to approximately $3.5 million within the next 12 months primarily due to lapses of statutes of limitations and settlement of ongoing audits in various jurisdictions.


NOTE 5 – Long-term debt
Our long-term debt is summarized below (in thousands):
Mar. 31, 2023Dec. 31, 2022
Unsecured notes bearing fixed rate interest at 4.75% due March 2026$550,000 $550,000 
Unsecured notes bearing fixed rate interest at 7.75% due June 2027200,000 200,000 
Unsecured notes bearing fixed rate interest at 7.25% due September 2027240,000 240,000 
Unsecured notes bearing fixed rate interest at 4.625% due March 20281,000,000 1,000,000 
Unsecured notes bearing fixed rate interest at 5.00% due September 20291,100,000 1,100,000 
Total principal long-term debt3,090,000 3,090,000 
Debt issuance costs(25,774)(26,911)
Unamortized premiums5,938 6,227 
Total long-term debt$3,070,164 $3,069,316 

Sept. 30, 2017 Dec. 31, 2016
    
Unsecured floating rate term loan due quarterly through August 2018$28,400
 $52,100
VIE unsecured floating rate term loans due quarterly through December 2018808
 1,292
Unsecured floating rate term loan due quarterly through June 2020110,000
 140,000
Unsecured floating rate term loan due quarterly through September 2020240,000
 285,000
Borrowings under revolving credit agreement expiring June 2020—
 635,000
Unsecured notes bearing fixed rate interest at 5.125% due October 2019600,000
 600,000
Unsecured notes bearing fixed rate interest at 5.125% due July 2020600,000
 600,000
Unsecured notes bearing fixed rate interest at 4.875% due September 2021350,000
 350,000
Unsecured notes bearing fixed rate interest at 6.375% due October 2023650,000
 650,000
Unsecured notes bearing fixed rate interest at 5.50% due September 2024325,000
 325,000
Unsecured notes bearing fixed rate interest at 7.75% due June 2027200,000
 200,000
Unsecured notes bearing fixed rate interest at 7.25% due September 2027240,000
 240,000
Total principal long-term debt3,344,208
 4,078,392
Debt issuance costs(23,462) (27,615)
Other (fair market value adjustments and discounts)(4,934) (7,382)
Total long-term debt3,315,812
 4,043,395
Less current portion of long-term debt maturities280,646
 646
Long-term debt, net of current portion$3,035,166
 $4,042,749

In connection withAs of March 31, 2023, cash and prior to the completioncash equivalents totaled $683.2 million and we had unused borrowing capacity of the spin-off, Cars.com borrowed an aggregate principal amount of approximately $675.0 million$1.49 billion under aour $1.51 billion revolving credit facility, agreement. The proceedswhich expires in August 2024. We were usedin compliance with all covenants, including the leverage ratio (our one financial covenant) contained in our debt agreements and revolving credit facility. We believe, based on our current financial forecasts and trends, that we will remain compliant with all covenants for the foreseeable future.

Under our revolving credit facility we have the ability to make a tax-free distributiondraw loans based on two different interest rate indices, one of $650.0 million from Cars.comwhich is based on the London Interbank Offered Rate (LIBOR). We are able to TEGNA. Indraw LIBOR-based loans based on one month, three month, six month and twelve month durations originated through June 2023. We expect to amend our revolving credit facility in the second quarter of 2017, TEGNA used $609.9 million of2023 to replace the tax-free distribution proceedsLIBOR-based interest rate index with a Secured Overnight Financing Rate (SOFR) based interest rate index. The transition from LIBOR is not expected to fully pay down our then-outstanding revolving credit agreement borrowings plus accrued interest. As of September 30, 2017, we had an unused borrowing capacity of $1.5 billion under our revolving credit facility.have a material impact on the Company.


As a result of the sale of our majority ownership stake in CareerBuilder we received cash proceeds of $198.3 million, net of cash transferred of $36.6 million. Additionally, during the third quarter of 2017 and prior to the closing of the sale, CareerBuilder issued a final cash dividend to its selling shareholders, of which $25.8 million was retained by TEGNA.
12

On October 16, 2017, we used the net proceeds from the CareerBuilder sale, as well as the remaining cash distribution from Cars.com and other cash on hand to retire $280.0 million of principal of our unsecured notes due in October 2019 on an accelerated basis. This principal amount was classified as current debt at the end of the third quarter of 2017 due to our intention to retire it in October 2017.


On August 1, 2017, we amended our Amended and Restated Competitive Advance and Revolving Credit Agreement. Under the amended terms, our maximum total leverage ratio will remain at 5.0x through June 30, 2018, after which, as amended, it will be reduced to 4.75x through June 2019 and then to 4.5x until the expiration date of the credit agreement on June 29, 2020.



NOTE 65 – Retirement plans


We have various defined benefit retirement plans. Our principal defined benefit pension plan is the TEGNA Retirement Plan (TRP). The disclosure table below primarily includes the pension expenses of the TRP and the TEGNA Supplemental Retirement Plan (SERP). The total net pension obligations, including both current and non-current liabilities, as of September 30, 2017,March 31, 2023, were $199.0$79.1 million, ($31.0of which $5.6 million is recorded as a current obligation within accrued liabilities on the Condensed Consolidated Balance Sheet).Sheet.


Our pensionPension costs (income), which primarily include costs for the qualified TRP plan and the nonqualifiednon-qualified SERP, plan, are presented in the following table (in thousands):
Quarter ended Mar. 31,
20232022
Interest cost on benefit obligation$6,150 $4,300 
Expected return on plan assets(5,225)(4,900)
Amortization of prior service credit(125)(125)
Amortization of actuarial loss1,575 1,100 
Expense from company-sponsored retirement plans$2,375 $375 
 Quarter ended Sept. 30, Nine months ended Sept. 30,
 2017 2016 2017 2016
        
Service cost-benefits earned during the period$218
 $204
 $654
 $612
Interest cost on benefit obligation5,990
 6,449
 17,971
 19,636
Expected return on plan assets(6,580) (6,691) (19,741) (20,073)
Amortization of prior service cost159
 165
 476
 505
Amortization of actuarial loss2,081
 1,846
 6,242
 5,740
Expense for company-sponsored retirement plans$1,868
 $1,973
 $5,602
 $6,420


TheBenefits no longer accrue for TRP and SERP participants as a result of amendments to the plans in past years, and as such we no longer incur a service cost component of our pension expense is recorded within the operating expense line items Cost of revenue, Business units - Selling, general and administrative, and Corporate - General and administrative within the Consolidated Statements of Income.expense. All other components of theour pension expense presented above are included within the Other“Other non-operating items, net” line item of the Consolidated Statements of Income.


During the ninethree months ended September 30, 2017March 31, 2023 and 2022, we made $10.9 million indid not make any cash contributions to the TRP, and plan to make additional contributions of $1.7 million to the TRP during the fourth quarter of 2017.TRP. We did not make any contributions to the TRP in 2016. During the nine months ended September 30, 2017 and 2016, we made benefit payments to participants of the SERP of $7.2 $0.9 million during both of the three month periods ended March 31, 2023 and $4.22022. Based on actuarial projections and funding levels, we do not expect to make any cash payments to the TRP in 2023 (as none are required based on our current funding levels). We expect to make additional cash payments of $4.6 million respectively.

to our SERP participants during the remainder of 2023.

NOTE 76 – Supplemental equity informationAccumulated other comprehensive loss
The following table summarizes equity account activity for the nine months ended September 30, 2017 and 2016 (in thousands):

 TEGNA Inc. Shareholders’ Equity Noncontrolling Interests Total Equity
      
Balance at Dec. 31, 2016$2,271,418
 $281,587
 $2,553,005
Comprehensive income:     
Net loss(29,881) (58,698) (88,579)
Redeemable noncontrolling interests (income not available to shareholders)—
 (2,797) (2,797)
Other comprehensive income34,241
 5,819
 40,060
Total comprehensive income (loss)4,360
 (55,676) (51,316)
Dividends declared(60,121) —
 (60,121)
Stock-based compensation14,189
 —
 14,189
Treasury shares acquired(8,453) —
 (8,453)
Spin-off of Cars.com(1,510,851) —
 (1,510,851)
Deconsolidation of CareerBuilder—
 (225,911) (225,911)
Other activity, including shares withheld for employee taxes(4,667) —
 (4,667)
Balance at Sept. 30, 2017$705,875
 $—
 $705,875
      
Balance at Dec. 31, 2015$2,191,971
 $264,773
 $2,456,744
Comprehensive income:     
Net income303,578
 40,178
 343,756
Redeemable noncontrolling interests (income not available to shareholders)—
 (3,628) (3,628)
Other comprehensive (loss)(8,497) (3,737) (12,234)
Total comprehensive income295,081
 32,813
 327,894
Dividends declared(90,755) —
 (90,755)
Stock-based compensation13,216
 —
 13,216
Treasury shares acquired(150,917) —
 (150,917)
Spin-off of Publishing businesses(39,456) —
 (39,456)
Other activity, including shares withheld for employee taxes(17,645) (2,923) (20,568)
Balance at Sept. 30, 2016$2,201,495
 $294,663
 $2,496,158





The following table summarizes the components of, and the changes in, Accumulated Other Comprehensive Loss (AOCL), net of tax and noncontrolling interests (in thousands):
Retirement PlansForeign Currency TranslationAvailable-For-Sale InvestmentTotal
Quarters ended:
Balance at Dec. 31, 2022$(126,065)$532 $— $(125,533)
Amounts reclassified from AOCL1,078 — — 1,078 
Total other comprehensive income1,078 — — 1,078 
Balance at Mar. 31, 2023$(124,987)$532 $— $(124,455)
Balance at Dec. 31, 2021$(113,090)$455 $15,419 $(97,216)
Other comprehensive loss before reclassifications— 77 — 77 
Amounts reclassified from AOCL724 — (15,419)(14,695)
Total other comprehensive income724 77 (15,419)(14,618)
Balance at Mar. 31, 2022$(112,366)$532 $— $(111,834)

13

 Retirement Plans Foreign Currency Translation (1) Other Total
        
Quarters Ended:       
Balance at June 30, 2017$(124,632) $(23,608) $2,364
 $(145,876)
Other comprehensive income before reclassifications—
 1,428
 —
 1,428
Amounts reclassified from AOCL1,351
 22,024
 —
 23,375
Other comprehensive income1,351
 23,452
 —
 24,803
Balance at Sept. 30, 2017$(123,281) $(156) $2,364
 $(121,073)
        
Balance at June 30, 2016$(113,854) $(23,282) $1,400
 $(135,736)
Other comprehensive loss before reclassifications—
 (1,043) (3,743) (4,786)
Amounts reclassified from AOCL1,075
 —
 —
 1,075
Other comprehensive income (loss)1,075
 (1,043) (3,743) (3,711)
Balance at Sept. 30, 2016$(112,779) $(24,325) $(2,343) $(139,447)
        
        
 Retirement Plans Foreign Currency Translation (1) Other Total
        
Nine Months Ended:       
Balance at Dec. 31, 2016$(127,341) $(28,560) $(5,672) $(161,573)
Other comprehensive income (loss) before reclassifications—
 6,380
 (1,707) 4,673
Amounts reclassified from AOCL4,060
 22,024
 9,743
 35,827
Other comprehensive income4,060
 28,404
 8,036
 40,500
Balance at Sept. 30, 2017$(123,281) $(156) $2,364
 $(121,073)
        
Balance at Dec. 31, 2015$(116,496) $(20,129) $5,674
 $(130,951)
Other comprehensive loss before reclassifications—
 (4,196) (8,017) (12,213)
Amounts reclassified from AOCL3,717
 —
 —
 3,717
Other comprehensive income (loss)3,717
 (4,196) (8,017) (8,496)
Balance at Sept. 30, 2016$(112,779) $(24,325) $(2,343) $(139,447)
        
(1) Our entire foreign currency translation adjustment is related to our CareerBuilder investment. As a result of deconsolidating the investment due to the sale of our majority ownership, we reclassified the translation adjustment from AOCL to the Consolidated Statement of Income as of the date of sale, July 31, 2017. Due to the noncontrolling stake that we retained in CareerBuilder, we will continue to record our ownership share of foreign currently translation adjustments through our equity method investment.











Reclassifications from AOCL to the StatementConsolidated Statements of Income are comprised of recognition of a realized gain on an available-for-sale investment as well as pension and other post-retirement components and a loss on our available for sale investment.components. Pension and other post retirement reclassifications are related to the amortizationamortizations of prior service costs and amortization of actuarial losses. The loss on our available for sale investments represents an other than temporary impairment (OTTI) recognized on our investment in shares of common stock of Gannett Co., Inc. in the second quarter of 2017. The OTTI loss represents the amount of loss previously recorded to AOCL which was recognized as a non-operating expense on the Consolidated Statement of Income due to the fact that we did not expect the investment to fully recover the losses prior to our sale of it. We sold the entirety of our investment in Gannett Co., Inc. common stock in the third quarter of 2017. Amounts reclassified out of AOCL are summarized below (in thousands):
Quarter ended Mar. 31,
20232022
Amortization of prior service credit, net$(125)$(125)
Amortization of actuarial loss1,575 1,100 
Realized gain on available-for-sale investment— (20,800)
Total reclassifications, before tax1,450 (19,825)
Income tax effect(372)5,130 
Total reclassifications, net of tax$1,078 $(14,695)

 Quarter ended
Sept. 30,		 Nine months ended
Sept. 30,
 2017 2016 2017 2016
        
Amortization of prior service (credit) cost$16
 $(22) $48
 $108
Amortization of actuarial loss2,185
 1,785
 6,555
 5,977
Reclassification of CareerBuilder foreign currency translation22,024
 —
 22,024
 —
Reclassification of available for sale investment—
 —
 9,743
 —
Total reclassifications, before tax24,225
 1,763
 38,370
 6,085
Income tax effect(850) (688) (2,543) (2,368)
Total reclassifications, net of tax$23,375
 $1,075
 $35,827
 $3,717

NOTE 87 – Earnings per share


Our earnings per share (basic and diluted) are presented below (in thousands, of dollars, except per share amounts):
 
Quarter ended
Sept. 30,
 Nine months ended Sept. 30,
 2017 2016 2017 2016
        
Net income from continuing operations$50,754
 $76,737
 $144,682
 $211,615
(Loss) income from discontinued operations, net of tax(10,803) 56,698
 (233,261) 132,141
Net loss (income) attributable to noncontrolling interests from discontinued operations2,806
 (14,752) 58,698
 (40,178)
Net income (loss) attributable to TEGNA Inc.$42,757
 $118,683
 $(29,881) $303,578
        
Weighted average number of common shares outstanding - basic215,863
 214,813
 215,558
 216,865
Effect of dilutive securities:    

 

Restricted stock units828
 1,630
 880
 1,662
Performance share units721
 775
 674
 1,049
Stock options683
 881
 715
 935
Weighted average number of common shares outstanding - diluted218,095
 218,099
 217,827
 220,511
        
Earnings from continuing operations per share - basic$0.24
 $0.36
 $0.67
 $0.98
(Loss) earnings from discontinued operations per share - basic(0.04) 0.19
 (0.81) 0.42
Net income (loss) per share - basic$0.20
 $0.55
 $(0.14) $1.40
        
Earnings from continuing operations per share - diluted$0.23
 $0.35
 $0.66
 $0.96
(Loss) earnings from discontinued operations per share - diluted(0.04) 0.19
 (0.80) 0.42
Net income (loss) per share - diluted$0.19
 $0.54
 $(0.14) $1.38
Quarter ended Mar. 31,
20232022
Net Income$104,004 $134,287 
Net loss (income) attributable to the noncontrolling interest299 (53)
Adjustment of redeemable noncontrolling interest to redemption value(635)(248)
Earnings available to common shareholders$103,668 $133,986 
Weighted average number of common shares outstanding - basic224,544 222,712 
Effect of dilutive securities:
Restricted stock units187 321 
Performance shares108 207 
Weighted average number of common shares outstanding - diluted224,839 223,240 
Earnings per share - basic$0.46 $0.60 
Earnings per share - diluted$0.46 $0.60 


Our calculation of diluted earnings per share includes the impact ofdilutive effects for the assumed vesting of outstanding restricted stock units and performance share units, and the exercise of outstanding stock options based on the treasury stock method when dilutive. The diluted earnings per share amounts exclude the effects of approximately 96,000 and 142,000 stock awards for the three and nine months ended September 30, 2017, respectively; and 192,000 and 292,000 for the three and nine months ended September 30, 2016, respectively, as their inclusion would be accretive to earnings per share.

shares.


NOTE 98 – Fair value measurement


We measure and record certain assets and liabilities at fair value in the accompanying condensed consolidated financial statements certain assets and liabilities at fair value.statements. U.S. GAAP establishes a hierarchy for those instruments measured at fair value that distinguishes between market data (observable inputs) and our own assumptions (unobservable inputs). The hierarchy consists of three levels:


Level 1 - Quoted market prices in active markets for identical assets or liabilities;


Level 2 - Inputs other than Level 1 inputs that are either directly or indirectly observable; and


Level 3 - Unobservable inputs developed using our own estimates and assumptions, which reflect those that a market participant would use.


The following table summarizes our assets and liabilities measured at fair value inIn the accompanying Condensed Consolidated Balance Sheets as of September 30, 2017, and December 31, 2016 (in thousands):
 Fair Value Measurements as of Sept. 30, 2017
 Level 1 Level 2 Level 3 Total
        
Available for sale investment—
 —
 —
 —
Total$—
 $—
 $—
 $—
        
Deferred compensation investments valued using net asset value as a practical expedient:  
Interest in registered investment companies      $14,921
Fixed income fund      13,672
Total investments at fair value      $28,593

 Fair Value Measurements as of Dec. 31, 2016 (recast)
 Level 1 Level 2 Level 3 Total
        
Available for sale investment16,744
 —
 —
 16,744
Total$16,744
 $—
 $—
 $16,744
        
Deferred compensation investments valued using net asset value as a practical expedient:  
Interest in registered investment companies      $10,140
Fixed income fund      13,575
Total investments at fair value      $40,459

Available for sale investment: Our investment previously consisted of shares of common stock of Gannett Co., Inc., which had been classified as a Level 1 asset as the shares are listed on the New York Stock Exchange. During the secondfirst quarter of 20172022, we recorded an OTTI lossa $2.5 million impairment charge, in the“Other non-operating items, line item of thenet” within our Consolidated Statement of Income, anddue to the decline in the third quarterfair value of 2017 we sold the investment in its entirety.

Interest in registered investment companies: These investments include one fundof our investments. The fair value was determined using a market approach which invests in intermediate-term investment grade bonds and a fund which invests in equities listed predominantlywas based on European and Asian exchanges. Funds are valued using the net asset values as quoted through publicly available pricing sources and investments are redeemable on request.

Fixed income fund investment: Valued using the net asset value provided monthly by the fund company and shares are generally redeemable on request. There are no unfunded commitments to these investments as of September 30, 2017.

In addition to the financial instruments listedsignificant inputs not observable in the table above, wemarket, and thus represented a Level 3 fair value measurement. We also hold other financial instruments, including cash and cash equivalents, receivables, accounts payable and debt. The carrying amounts for cash and cash equivalents, receivables and accounts payable approximated their fair values. The fair value of our total debt, based on the bid and ask quotes for the related debt (Level 2), totaled $3.49$2.78 billion at September 30, 2017,March 31, 2023, and $4.19$2.95 billion at December 31, 2016.2022.

14

The sale of the majority of our ownership in CareerBuilder resulted in a $342.9 million pre-tax loss recorded within discontinued operations (see Note 12). The loss includes a goodwill impairment charge of $332.9 million. The valuation used in


NOTE 9 – Other matters
the Step 1 goodwill impairment test was based on the enterprise value determined in the purchase agreement (which represents a Level 3 input in the fair value hierarchy).

Litigation
During
In the third quarter of 2017,2018, certain national media outlets reported the existence of a fewconfidential investigation by the United States Department of ourJustice Antitrust Division (DOJ) into the local television advertising sales practices of station owners. We received a Civil Investigative Demand (CID) in connection with the DOJ’s investigation. On November 13 and December 13, 2018, the DOJ and seven other broadcasters settled a DOJ complaint alleging the exchange of competitively sensitive information in the broadcast television industry. In June 2019, we and four other broadcasters entered into a substantially identical agreement with DOJ, which was entered by the court on December 3, 2019. The settlement contains no finding of wrongdoing or liability and carries no penalty. It prohibits us and the other settling entities from sharing certain confidential business information, or using such information pertaining to other broadcasters, except under limited circumstances. The settlement also requires the settling parties to make certain enhancements to their antitrust compliance programs, to continue to cooperate with the DOJ’s investigation, and to permit DOJ to verify compliance. The costs of compliance have not been material, nor do we expect future compliance costs to be material.

Since the national media reports, numerous putative class action lawsuits were filed against owners of television stations (the Advertising Cases) in different jurisdictions. Plaintiffs are a class consisting of all persons and entities in the United States who paid for all or a portion of advertisement time on local television provided by the defendants. The Advertising Cases assert antitrust and other claims and seek monetary damages, attorneys’ fees, costs and interest, as well as injunctions against the allegedly wrongful conduct.

These cases were impacted by hurricanes Harvey and Irma.consolidated into a single proceeding in the United States District Court for the Northern District of Illinois, captioned In particular, Hurricane Harvey caused major damage to our Houston television station (KHOU), andre: Local TV Advertising Antitrust Litigation on October 3, 2018. At the court’s direction, plaintiffs filed an amended complaint on April 3, 2019, that superseded the original complaints. Although we were named as a result, we recognized $10.2 milliondefendant in non-cash charges, writing off destroyed equipmentsixteen of the original complaints, the amended complaint did not name TEGNA as a defendant. After TEGNA and recording an impairmentfour other broadcasters entered into consent decrees with the DOJ in June 2019, the plaintiffs sought leave from the court to further amend the complaint to add TEGNA and the other settling broadcasters to the valueproceeding. The court granted the plaintiffs’ motion, and the plaintiffs filed the second amended complaint on September 9, 2019. On October 8, 2019, the defendants jointly filed a motion to dismiss the matter. On November 6, 2020, the court denied the motion to dismiss. On March 16, 2022, the plaintiffs filed a third amended complaint, which, among other things, added ShareBuilders, Inc., as a named defendant. ShareBuilders filed a motion to dismiss on April 15, 2022, which was granted by the court without prejudice on August 29, 2022. TEGNA has filed its answer to the third amended complaint denying any violation of law and asserting various affirmative defenses. We believe that the claims asserted in the Advertising Cases are without merit, and intend to defend vigorously against them.

Litigation Relating to the Merger

As of May 10, 2023, seven lawsuits have been filed by purported TEGNA stockholders in connection with the Merger. The lawsuits have been filed against TEGNA and the current members of the building (fair valueBoard of Directors of TEGNA (the Board of Directors). The complaints generally allege that the preliminary proxy statement filed by TEGNA with the SEC on March 25, 2022 in connection with the Merger contained alleged material misstatements and/or omissions in violation of federal law. Plaintiffs in the complaints generally seek, among other things, to enjoin TEGNA from consummating the Merger, or in the alternative, rescission of the building was determined using a market based valuation). Merger and/or compensatory damages, as well as attorneys’ fees. As of May 10, 2023, all but one of those lawsuits have been voluntarily dismissed.

In addition, we incurred $8.4 million in cash expenses related to repairing the studio and office and providing for additional staffing and operational needs to keep the station operating during and immediately following these weather emergencies. Partially offsetting these expenses, we received initial insurance proceeds of $11.0 million ($5.0 million was received as of September 30, 2017 and $6.0 million wasMay 10, 2023, TEGNA received four demand letters from purported TEGNA shareholders in October 2017)connection with TEGNA’s filing of a definitive proxy statement with the SEC on April 13, 2022 relating to the Merger (the “definitive proxy statement”). The net expense impact fromEach letter alleged deficiencies in the hurricane of $7.6 million has been recordeddefinitive proxy statement that were similar to the deficiencies alleged in asset impairment and facility consolidation charges on our Consolidated Statements of Income.the complaints referenced above.


We also recorded a non-cash impairment charge of $5.8 millionbelieve that the claims asserted in the second quartercomplaints and letters described above are without merit and no additional disclosures were or are required under applicable law. However, to moot the unmeritorious disclosure claims, to avoid the risks of 2017 associatedthe actions described above delaying or adversely affecting the Merger and to minimize the costs, risks and uncertainties inherent in litigation, without admitting any liability or wrongdoing, TEGNA voluntarily made supplemental disclosures to the definitive proxy statement as described in the Form 8-K filed by TEGNA with the write-offSEC on May 9, 2022. Additional lawsuits arising out of a note receivable from one of our equity method investments (see Note 3).




NOTE 10 – Business segment information

Our reportable segment determination is based on our management and internal reporting structure, the nature of products and services offered by the segments, and the financial information that is evaluated regularly by our chief operating decision maker.

Immediately following the spin-off of Cars.com and the sale of our majority stake in CareerBuilder, we began classifying our operations as one operating and reportable segment, Media, which consists of our 46 television stations operating in 38 markets, offering high-quality television programming and digital content. Also now includedMerger may also be filed in the Media Segment is our DMS business which was previously reported in our Digital Segment.future.

As a result of classifying the former Digital Segment’s historical financial results as discontinued operations there is no remaining activity in 2017 as shown in the tables below. The 2016 activity shown below for our Digital Segment relates to our former Cofactor business which did not meet the criteria for discontinued operation reporting when the business was sold in December 2016. The historical periods below have also been updated to restate the historical results of our DMS business within our Media business.

Segment operating results are summarized as follows (in thousands):
 Quarter ended Sept. 30, Nine months ended Sept. 30,
 2017 2016 2017 2016
   (recast)   (recast)
Revenues:       
Media$464,264
 $517,021
 $1,412,703
 $1,449,202
Digital—
 2,596
 —
 8,031
Total$464,264
 $519,617
 $1,412,703
 $1,457,233
        
Operating Income (net of depreciation, amortization, asset impairment and facility consolidation charges):       
Media (a)
$130,338
 $219,766
 $433,629
 $568,163
Digital—
 (17,832) —
 (23,300)
Corporate (a)
(13,477) (16,083) (43,577) (46,974)
Total$116,861
 $185,851
 $390,052
 $497,889
        
Depreciation, amortization, asset impairment and facility consolidation charges:       
Media$27,538
 $18,583
 $67,864
 $59,735
Digital—
 15,565
 —
 16,297
Corporate596
 57
 1,115
 3,109
Total$28,134
 $34,205
 $68,979
 $79,141
        
(a) In the first quarter of 2017, we adopted new accounting guidance that changed the classification of certain components of net periodic pension and other post-retirement benefit expense (post-retirement benefit expense). The service cost component of the post-retirement benefit expense will continue to be presented as an operating expense while all other components of post-retirement benefit expense will be presented as non-operating expense. The prior year period was adjusted to reflect the effects of applying the new guidance. This resulted in an increase to operating income in third quarter of 2017 and 2016 of $1.7 million and $1.8 million and for the nine months ended September 30, 2017 and 2016 of $4.9 million and $5.8 million, respectively. Net income, earnings per share, and retained earnings were not impacted by the new standard.




NOTE 11 – Other matters

Commitments, contingencies and other matters


We, along with a number of our subsidiaries, also are defendants in other judicial and administrative proceedings involving matters incidental to our business. We do not believe that any material liability will be imposed as a result of theseany of the foregoing matters.


Voluntary Retirement Program
15


Related Party Transactions
During
We have equity investments in MadHive which is a related party of TEGNA. We also have a commercial agreement with MadHive, under which MadHive supports our Premion business in acquiring over-the-top advertising inventory and delivering corresponding advertising impressions. In the first quarter of 2016,2023 and 2022, we initiated a Voluntary Retirement Program (VRP) at our Media Segment. Under the VRP, Media employees meeting certain eligibility requirements were offered buyout payments in exchange for voluntarily retiring. Eligible non-union employees had until April 7, 2016, to retire under the plan. In 2016, based on acceptances received, we recorded $16.0incurred expenses of $25.1 million of severance expense. Upon separation, employees accepting the VRP received salary continuation payments primarily based on years of service, the majority of which occurred evenly over the 12-month period following separation date. As of September 30, 2017, we had less than $0.4and $26.0 million, of VRP buyout obligation remaining.

FCC Broadcast Spectrum Program

Congress authorized the Federal Communications Commission (FCC) to conduct a voluntary incentive auction to reallocate certain spectrum currently occupied by television broadcast stations to mobile wireless broadband services, along with a related “repacking” of the television spectrum for remaining television stations. The repacking requires that certain television stations move to different channels, and some stations will have smaller service areas and/or experience additional interference. Congress announced the results of the auction, including a list of the stations to be repacked, in April 2017. None of our stations will relinquish any spectrum rightsrespectively, as a result of the auction,commercial agreement with MadHive. As of March 31, 2023, and accordinglyDecember 31, 2022 we will not receive any incentive auction proceeds. The FCC has, however, notified us that 13 of our stations will be repacked to new channels. The repacking process is scheduled to occur over a 39-month period, divided into ten phases. Our stations have been assigned to phases two through nine,had accounts payable and a majority of our capital expenditures in connectionaccrued liabilities associated with the repack will occur in 2018 and 2019.MadHive commercial agreements of $15.2 million and $10.0 million, respectively.


We are eligible to seek reimbursement for costs associatedIn December 2021, we renewed two commercial agreements with implementing changes to our facilities required by the repack. The legislation authorizing the incentive auction and repacking established a $1.75 billion fund for reimbursement of costs incurred by stations required to change channels in the repacking. The FCC has reported that the aggregate cost estimated by repacked stations to complete the repack will be almost $1.9 billion. In October 2017, the FCC announced that it had made an approximately $1 billion allocation from the fund to repacked stations to allow those stations to begin to be reimbursed for expenses incurred in connectionMadHive. Simultaneously with the construction of facilities on reassigned channels. This allocation represents approximately 52% of the total estimated demand for repack funds. Althoughcommercial agreement renewals, we expect the FCC to make additional allocations from the fund, it is not clear at this time whether the FCC ultimately will receive from Congress the additional funds necessary to completely reimburse each repacked station for all amounts incurred in connection with the repack. Beyond the potential for not being reimbursed for all amounts we incur, it is still too early to predict the ultimate impact of the incentive auction and repacking upon our business.

As noted above, while we did not sell any of our spectrum in the auction, we did enter into a channel share agreement with another broadcaster that sold spectrum in the auction. Pursuant toalso amended the terms of our channel share agreementthen outstanding available-for-sale convertible debt security investment. In exchange for the convertible debt modifications, we received $32.6favorable terms in our renewed commercial agreements. We estimated the fair value of our available-for-sale security at December 31, 2021 using a market fair value approach based on the cash we expect to receive upon maturity of the note and the estimated cash savings that the favorable contract terms will provide over the term of the commercial agreements. In January 2022, we recorded an intangible contract asset for $20.8 million in(equal to the estimated cash proceeds during the third quarter of 2017. These proceeds were deferredsavings), and will be amortizedare amortizing this asset on a straight-line basis as other revenue over a 20 year period. The $32.6 million cash proceeds were reflected as cash flow from operating activities on our Condensed Consolidated Statements of Cash Flow.

NOTE 12 – Discontinued operations

Cars.com spin-off

On May 31, 2017, we completed the previously announced spin-off of Cars.com creating two publicly traded companies: TEGNA, an innovative media company with the largest broadcast group among major network affiliates in the top 25 markets; and Cars.com, a leading digital automotive marketplace. The spin-off was effected through a pro rata distribution of all outstanding common shares of Cars.com to TEGNA stockholders of record at the close of business on May 18, 2017 (the “Record Date”). Stockholders retained their TEGNA shares and received one share of Cars.com for every three shares of TEGNA stock they owned on the Record Date. Cars.com began “regular way” trading on the New York Stock Exchange on June 1, 2017 under the symbol “CARS”. In connection with the Cars.com spin-off, we received a one time tax-free cash distribution from Cars.com of $650.0 million. In the second quarter of 2017, we used $609.9 million of the tax-free distribution proceeds to fully pay down outstanding revolving credit agreement borrowings. In October 2017, we used the remainder of the proceeds to pay down a portion of the outstanding principal on unsecured notes due in October 2019 (see Note 5).



Separation Agreement

We entered into a separation agreement with Cars.com which sets forth, among other things, the identified assets transferred, the liabilities assumed and the contracts assigned to each of TEGNA and Cars.com as part of the separation and the conditions related to the distribution of Cars.com outstanding stock to TEGNA stockholders.

Transition Services Agreement

We entered into a transition services agreement with Cars.com prior to the distribution pursuant to which we and our subsidiaries will provide certain services to Cars.com on an interim and transitional basis, not to exceed 24 months. The services to be provided include certain tax, human resource and risk management consulting services, and certain other short term services to complete a limited number of ongoing analysis projects. The agreed upon charges for such services are generally intended to allow us to recover all costs and expenses of providing such services, and such charges are not expected to be material to either us or Cars.com.

The transition services agreement will terminate on the expiration of thenoncancellable term of the last service provided under it, with a minimum service periodcommercial agreements of 60 days and a maximum service periodtwo years. This non-cash expense is recorded within “Cost of 24 months, with most services expected to last for less than the maximum service period following the distribution date. Cars.com generally can terminate a particular service prior to the scheduled expiration date, subject generally to the minimum service period and a minimum notice period of 45 days.

Tax Matters Agreement

Prior to the distribution, we entered into a tax matters agreement that governs the parties’ respective rights, responsibilities and obligations with respect to taxes (including taxes arising in the ordinary course of business and taxes, if any, incurred as a result of any failure of the distribution and certain related transactions to qualify as tax-free for U.S. federal income tax purposes), tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings and assistance and cooperation in respect of tax matters.

Employee Matters Agreement

We entered into an employee matters agreement with Cars.com prior to the distribution to allocate liabilities and responsibilities relating to employment matters, employee compensation and benefit plans and programs and other related matters. The employee matters agreement governs certain compensation and employee benefit obligations with respect to the current and former employees and non-employee directors of each company.

The employee matters agreement provides that, unless otherwise specified, Cars.com will be responsible for liabilities associated with employees who will be employed by Cars.com following the spin-off and former employees whose last employment was with the Cars.com businesses, and we will be responsible for all other current and former TEGNA employees. Cars.com will retain sponsorship of 401(k) retirement plans, deferred compensation plans and other incentive plans maintained for the exclusive benefit of Cars.com employees as well as various welfare plans applicable to the Cars.com employees.

CareerBuilder Sale

On July 31, 2017, we sold our majority ownership interest in CareerBuilder to an investor group led by investment funds managed by affiliates of Apollo Global Management, LLC, a leading global alternative investment manager, and the Ontario Teachers’ Pension Plan Board. Our share of the pre-tax net cash proceeds from the sale was $198.3 million. These net proceeds were used in October 2017 to pay down existing debt (see Note 5). Additionally, during the third quarter of 2017 and prior to the closing of the sale, CareerBuilder issued a final dividend to its selling shareholders, of which $25.8 million was retained by TEGNA. As part of the agreement, we remain an ongoing partner in CareerBuilder, reducing our 53% controlling interest to approximately 17% interest (or approximately 12% on a fully-diluted basis) and two seats on CareerBuilder’s 10 person board. As a result, subsequent to the sale, CareerBuilder is no longer consolidatedrevenues,” within our reported operating results. Our remaining ownership interest will be accounted for as an equity method investment. Subsequent to the date of sale we recorded $0.5 million of equity earnings during the remainder of the third quarter of 2017 from our remaining interest in CareerBuilder.

FinancialConsolidated Statement Presentation of Digital Segment

As a result of the Cars.com and CareerBuilder transactions described above, the operating results and financial position of our former Digital Segment have been included in discontinued operations in the Condensed Consolidated Balance Sheet and Consolidated Statements of Income for all applicable periods presented. The results of discontinued operations for the nine months ended September 2017 include a $342.9 million pre-tax loss related to the sale of CareerBuilder (after noncontrolling interest, $271.7 million of the pre-tax loss is attributable to TEGNA). The pre-tax loss includes a goodwill impairment charge of $332.9 million and costs to sell the business of $10.9 million. Fair value used for the pre-tax loss was based on the enterprise value of CareerBuilder as determined in the definitive purchase agreement.



The carrying value of the assets and liabilities of our former Digital Segment’s discontinued operations as of December 31, 2016 were as follows (in thousands):
  
 Dec. 31, 2016
  
ASSETS 
Cash and cash equivalents$61,041
Accounts receivable, net214,171
Property and equipment, net74,695
Goodwill1,488,112
Other Intangibles, net1,718,592
Other assets71,193
Total assets$3,627,804
  
LIABILITIES 
Accounts payable$166,853
Deferred revenue110,071
Deferred tax liability280,264
Other liabilities66,969
Total liabilities$624,157

The financial results of discontinued operations in the third quarter and the nine months ended September 30, 2017 and 2016 are presented as a loss (income) from discontinued operations, net of tax, on our Consolidated Statements of Income. The following table presentsdebt matured in June 2022 at which time the financial resultsprincipal balance of discontinued operations (in thousands):$3.0 million plus accrued interest was paid to us.



 
Quarter ended
Sept. 30,
 
Nine months ended
Sept. 30,
 2017 (1) 2016 2017 (1) 2016 (2)
        
Operating revenues$54,874
 $340,649
 $647,021
 $999,929
        
Cost of revenue and SG&A expenses60,301
 228,152
 522,287
 708,815
Depreciation—
 9,421
 19,569
 24,843
Amortization—
 23,385
 40,300
 68,159
Loss on sale of CareerBuilder(1,872) —
 342,900
 —
Total operating expenses58,429
 260,958
 925,056
 801,817
        
Total operating (loss) income(3,555) 79,691
 (278,035) 198,112
        
Non-operating income (expense)647
 (3,304) (1,078) (8,989)
        
(Loss) income from discontinued operations, before income taxes(2,908) 76,387
 (279,113) 189,123
Provision for income taxes(7,895) (19,689) 45,852
 (56,982)
(Loss) income from discontinued operations, net of tax$(10,803) $56,698
 $(233,261) $132,141
        
(1) The quarter and nine months ended September 30, 2017 include CareerBuilder’s operations through the date of sale on July 31, 2017. Cars.com operations are included in the nine months ended September 30, 2017 through the date of spin-off on May 31, 2017.
(2) The nine months ended September 30, 2016 include approximately $7.5 million of net loss from discontinued operations related to the operations of our former Sightline business through the date of sale on March 18, 2016.



In our Consolidated Statements of Cash Flows, the cash flows from discontinued operations are not separately classified. As such, major categories of discontinued operation cash flows for the nine months ended September 30, 2017 and 2016 are presented below (in thousands):
 Nine months ended Sept. 30,
 2017 (1) 2016
    
Depreciation$19,569
 $24,843
Amortization40,300
 68,159
Capital expenditures37,441
 38,825
Payments for acquisitions, net of cash acquired$—
 $196,750
    
(1) The nine months ended September 30, 2017 includes Cars.com through the spin-off date of May 31, 2017 and CareerBuilder’s operations through the date of sale on July 31, 2017.


Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Company Overview


We are an innovative media company that servesserving the greater good of our communities. Across platforms, we tell empowering stories, conduct impactful investigations and deliver innovative marketing services. With 4664 television stations and two radio stations in 3851 U.S. markets, we are the largest owner of top four network affiliates in the top 25 markets among independent station groups, reaching approximately one-third39% of all U.S. television households nationwide.households. We also own leading multicast networks True Crime Network, Twist and Quest. Each television station also has a robust digital presence across online, mobile, connected television and social platforms, reaching consumers whenever, whereveron all devices and platforms they are. Each month, we reach 50 million adults on-air and 35 million across our digital platforms.use to consume news content. We have been consistently honored with the industry’s top awards, including Edward R. Murrow, George Polk, Alfred I. DuPont and Emmy Awards. WeThrough TEGNA Marketing Solutions (TMS), our integrated sales and back-end fulfillment operations, we deliver results for advertisers through unparalleledacross television, digital and innovative solutionsover-the-top (OTT) platforms, including Premion, our Over the Top (“OTT”) localOTT advertising network, Premion, centralized marketing resource, Hatch; and our digital marketing services (DMS) business, a one-stop shop for local businesses to connect with consumers through digital marketing. Across platforms, we tell empowering stories, conduct impactful investigations and deliver innovative marketing solutions. network.


We continue to make innovative programming a priority and invest in local news and other special programming to ensure we stay connected to our audiences and empower them throughout the day. For example, we recently launched VERIFY news, a fact-checking segment across platforms, and HeartThreads, a new national digital content vertical. Additionally, in September 2017 we premiered our TEGNA-owned daily live syndicated program “Daily Blast LIVE,” which airs on 36 TEGNA stations and nationally on Facebook and YouTube. Also in September, we launched a daily talk show, “Sister Circle,” produced out of WATL in Atlanta, which airs in 12 TEGNA markets and nationally live on TV One, reaching 60% of U.S. television households. Finally, our KXTV station in Sacramento partnered with Cheddar network to launch “Cheddar Local,” which provides KXTV with local business and technology segments relevant to the Sacramento community.

After completing the strategic actions discussed below, we now have one operating and reportable segment. The primary sources of our revenues are: 1) subscription revenues, reflecting fees paid by satellite, cable, OTT (companies that deliver video content to consumers over the Internet) and telecommunications providers to carry our television signals on their systems; 2) advertising & marketing services (AMS) revenues, which include local and national non-political television advertising, as well as DMSdigital marketing services (including Premion), and advertising on the stations’ websites, and tablet and mobile products; 2)products and OTT apps; 3) political advertising revenues, which are driven by electionseven year election cycles at the local and peak in even yearsnational level (e.g. 2016, 2014)2024, 2022, etc.) and particularly in the second half of those years; 3) subscription revenues, representing fees primarily paid by satellite and cable operators and telecommunications companies to carry our television signals on their systems and OTT revenues; and 4) other services, such as production of programming, tower rentals, and distribution of our local news content.

Merger Agreement

On February 22, 2022, we entered into the Merger Agreement with Parent, Merger Sub, and solely for purposes of certain provisions specified therein, other subsidiaries of Parent, certain affiliates of Standard General and CMG, and certain of its subsidiaries. On February 24, 2023, the FCC issued a hearing designation order (the “HDO”) with respect to the transaction. On March 27, 2023, certain of the parties to the Merger Agreement filed a notice of appeal of the HDO and a petition for a writ of mandamus with the United States Court of Appeals for the District of Columbia Circuit, (the “D.C. Court of Appeals”). On April 3, 2023, the D.C. Court of Appeals dismissed the appeal of the HDO. On April 21, 2023, the D.C. Court of Appeals denied the petition for a writ mandamus. TEGNA is currently evaluating its options. See Notes 1 and 9 to the condensed consolidated financial statements for further information about the Merger Agreement, the pending Merger and related matters.

We plan to continue to pay our regular quarterly dividend of $0.095 per share through the closing of the Merger, which is the maximum rate and frequency permitted by the Merger Agreement. As a result of the pending transaction, we suspended share repurchases under our previously announced share repurchase program.

16

Consolidated Results from Operations

The following discussion is a comparison of our consolidated results on a GAAP basis. The year-to-year comparison of financial results is not necessarily indicative of future results. In addition, see the section titled “Results from Operations - Non-GAAP Information” for additional tables presenting information which supplements our financial information provided on a GAAP basis.

Our operating results are subject to significant fluctuations across yearly periods (primarily driven by even-year political election cycles). As such, in addition to prior year comparisons, our management team and Board of Directors also review quarterly operating results compared to the same periods two years ago (e.g., 2023 vs. 2021). We believe these additional comparisons provide useful information to investors and therefore, have supplemented our prior year comparisons of consolidated results with comparisons against first quarter ended March 31, 2021 results (through operating income).

In recent years, our business has evolved toward generating more recurring and highly profitable revenue streams, driven by the increased contribution of political and subscription revenue streams as a percentage of our total revenue. Such revenues have been a majority of our overall revenue the past few years and we expect this to continue.

Our consolidated results of operations on a GAAP basis were as follows (in thousands, except per share amounts):
Quarter ended Mar. 31,
20232022Change from 20222021Change from 2021
Revenues$740,327 $774,123 (4 %)$727,051 2 %
Operating expenses:
Cost of revenues426,932 411,450 4 %394,692 8 %
Business units - Selling, general and administrative expenses99,109 101,969 (3 %)89,326 11 %
Corporate - General and administrative expenses12,100 21,320 (43 %)16,870 (28 %)
Depreciation15,049 15,305 (2 %)15,896 (5 %)
Amortization of intangible assets13,582 15,000 (9 %)15,760 (14 %)
Spectrum repacking reimbursements and other, net— (58)***(1,423)***
Total operating expenses$566,772 $564,986 0 %$531,121 7 %
Total operating income$173,555 $209,137 (17 %)$195,930 (11 %)
Non-operating expenses(37,732)(30,112)25 %(47,484)(21 %)
Provision for income taxes31,819 44,738 (29 %)35,614 (11 %)
Net income104,004 134,287 (23 %)112,832 (8 %)
Net (income) loss attributable to redeemable noncontrolling interest299 (53)***(215)***
Net income attributable to TEGNA Inc.$104,303 $134,234 (22 %)$112,617 (7 %)
Earnings per share - basic$0.46 $0.60 (23 %)$0.51 (10 %)
Earnings per share - diluted$0.46 $0.60 (23 %)$0.51 (10 %)
*** Not meaningful

Revenues

Our Subscription revenue category includes revenue earned from cable and satellite providers for the right to carry our signals and the distribution of TEGNA stations on OTT streaming services. Our AMS category includes all sources of our traditional television advertising and digital revenues including Premion and other digital advertising and marketing revenues across our platforms.

17

Our revenues and operating results are subject to seasonal fluctuations. Generally, our second and fourth quarter revenues and operating results are stronger than those we report for the first and third partiesquarter. This is driven by the second quarter reflecting increased spring seasonal advertising, while the fourth quarter typically includes increased advertising related to the holiday season. In addition, our revenue and productionoperating results are subject to significant fluctuations across yearly periods resulting from political advertising. In even numbered years, political spending is usually significantly higher than in odd numbered years due to advertising for the local, state and national elections. Additionally, every four years, we typically experience even greater increases in political advertising in connection with the presidential election. The strong demand for advertising from political advertisers in these even years can result in the significant use of our available inventory (leading to a “crowd out” effect), which can diminish our AMS revenue in the even year of a two year election cycle, particularly in the fourth quarter of those years.

The following table summarizes the year-over-year changes in our revenue categories (in thousands):
Quarter ended Mar. 31,
20232022Change from 20222021Change from 2021
Subscription$414,280 $391,654 6 %$386,737 7 %
Advertising & Marketing Services307,845 354,467 (13)%322,834 (5)%
Political5,291 17,965 (71)%9,428 (44)%
Other12,911 10,037 29 %8,052 60 %
Total revenues$740,327 $774,123 (4)%$727,051 2 %
*** Not meaningful

2023 vs. 2022

Total revenues decreased $33.8 million in the first quarter of 2023 compared to the same period in 2022. The net decrease was primarily driven by a $46.6 million decline in AMS revenue due to the impact of the Winter Olympics and Super Bowl airing last year on NBC, our largest network affiliate partner. Macroeconomic headwinds also negatively impacted our AMS revenue in 2023. Also contributing to the decrease was $12.7 million decline in political revenue. Partially offsetting these decreases was a $22.6 million increase in subscription revenue primarily due to annual rate increases under existing and newly renegotiated retransmission agreements, partially offset by declines in subscribers.

2023 vs. 2021

Total revenues increased $13.3 million in the first quarter of 2023 compared to the same period in 2021. The net increase was primarily due to $27.5 million growth in subscription revenue mainly due to annual rate increases under existing and newly renegotiated retransmission agreements, partially offset by declines in subscribers. Partially offsetting this increase was a $15.0 million decrease in AMS revenue reflecting softer demand for advertising material.caused by macroeconomic headwinds and a $4.1 million decrease in political revenue.


Cost of revenues

2023 vs. 2022

Cost of revenues increased $15.5 million in the first quarter of 2023 compared to the same period in 2022. The increase was primarily due to growth in programming costs of $15.3 million driven by rate increases under existing and newly renegotiated affiliation agreements.

2023 vs. 2021

Cost of revenues increased $32.2 million in the first quarter of 2023 compared to the same period in 2021. The increase was primarily due to $26.6 million growth in programming costs driven by rate increases under existing and newly renegotiated affiliation agreements.

Business units - Selling, general and administrative expenses

2023 vs. 2022

Business unit selling, general and administrative expenses decreased $2.9 million in the first quarter of 2023 compared to the same period in 2022. The decrease was primarily due to $2.0 million of lower stock-based compensation expense driven by a decline in our stock price. Additionally, selling costs, primarily sales compensation, declined $0.5 million in 2023 driven by a decline in advertising revenue.
18


2023 vs. 2021

Business unit SG&A expenses increased $9.8 million in the first quarter of 2023 compared to the same period in 2021. The increase was due in part to an absence of bad debt expense reversal that occurred in 2021 that did not recur in 2023 as well as an increase in payroll and benefit costs.

Corporate - General and administrative expenses

Our corporate costs are separated from our business expenses and are recorded as general and administrative expenses in our Consolidated Income Statement. These costs include activities that are not directly attributable or allocable to our media business operations.Statement of Income. This category primarily consists of broad corporate management functions including legal, human resources,Legal, Human Resources, and finance,Finance, as well as activities and costs not directly attributable to the operations of our media business.


Strategic Actions2023 vs. 2022

On May 31, 2017, we completed the previously announced spin-off of Cars.com. The spin-off was achieved through a pro rata distribution of all outstanding common shares of Cars.com to TEGNA stockholders of record at the close of business on May 18, 2017 (the “Record Date”). Stockholders retained their TEGNA shares and received one share of Cars.com for every three shares of TEGNA stock they owned on the Record Date. Cars.com began “regular way” trading on the New York Stock Exchange on June 1, 2017 under the symbol “CARS”. In connection with the Cars.com spin-off we received a one time cash distribution from Cars.com of $650.0 million.

On July 31, 2017, we completed the sale of our majority ownership interest in CareerBuilder to an investor group led by investments funds managed by affiliates of Apollo Global Management, LLC, a leading global alternative investment manager,


and the Ontario Teachers’ Pension Plan Board. Our share of the pre-tax net cash proceeds from the sale was $198.3 million. These net proceeds were used in October 2017 to pay down existing debt (see Note 5). Additionally, prior to the sale, CareerBuilder issued a final dividend to its selling shareholders, $25.8 million of which was retained by TEGNA.

As part of the sale agreement, we remain an ongoing partner in CareerBuilder, reducing our 53% controlling interest to approximately 17% equity interest (or approximately 12% on a fully-diluted basis) and two seats on CareerBuilder’s 10 member board. As a result, CareerBuilder is no longer consolidated within our reported operating results. Our remaining ownership interest is accounted for as an equity method investment.

Consolidated Results from Operations

The following discussion is a period-to-period comparison of our consolidated results from continuing operations on a GAAP basis. On May 31, 2017, we completed the spin-off of Cars.com and on July 31, 2017, we completed the sale of our majority ownership interest in CareerBuilder. Results for Cars.com and CareerBuilder are now reflected as Discontinued Operations in our Consolidated Statements of Income for all applicable periods presented. As a result, we will report one segment going forward which will include the results for Media and a remaining DMS contract that was previously reported in the Digital Segment. The historical financial results also include our former Cofactor business through the date of its sale in December 2016.

The period-to-period comparison of financial results is not necessarily indicative of future results. In addition, see the section on page 26 titled ‘Results from Operations - Non-GAAP Information’ for additional tables presenting information which supplements our financial information provided on a GAAP basis. Our consolidated results of continuing operations on a GAAP basis were as follows (in thousands, except per share amounts):
 Quarter ended Sept. 30, Nine months ended Sept. 30,
 2017 2016 Change 2017 2016 Change
   (recast)     (recast)  
Revenues$464,264
 $519,617
 (11%) $1,412,703
 $1,457,233
 (3%)
            
Operating expenses:    

      
Cost of revenues, exclusive of depreciation235,474
 200,495
 17% 696,565
 590,058
 18%
Business units - selling, general and administrative expenses, exclusive of depreciation70,914
 83,039
 (15%) 214,645
 246,280
 (13%)
Corporate - General and administrative expenses, exclusive of depreciation12,881
 16,027
 (20%) 42,462
 43,865
 (3%)
Depreciation15,186
 13,212
 15% 41,721
 42,653
 (2%)
Amortization of intangible assets5,395
 5,775
 (7%) 16,172
 17,542
 (8%)
Asset impairment and facility consolidation charges7,553
 15,218
 (50%) 11,086
 18,946
 (41%)
Total operating expenses$347,403
 $333,766
 4% $1,022,651
 $959,344
 7%
            
Total operating income$116,861

$185,851
 (37%) $390,052
 $497,889
 (22%)
            
Non-operating expense(54,660) (70,673) (23%) (190,515) (194,236) (2%)
Provision for income taxes11,447
 38,441
 (70%) 54,855
 92,038
 (40%)
Net income from continuing operations$50,754
 $76,737
 (34%) $144,682
 $211,615
 (32%)
            
Earnings from continuing operations per share - basic$0.24
 $0.36
 (33%) $0.67
 $0.98
 (32%)
Earnings from continuing operations per share - diluted$0.23
 $0.35
 (34%) $0.66
 $0.96
 (31%)

Revenues

During the second quarter of 2017, we changed the way we present certain revenues, which we now call Advertising and Marketing Services (AMS), to better reflect our sales transformation strategy that focuses on customer needs versus specific products. This category includes all sources of our traditional and digital revenues including Premion, DMS and other digital advertising and marketing revenues across our platforms.

Also, the “Retransmission” revenue category was renamed “Subscription” to better reflect changes in that revenue stream, including the distribution of TEGNA stations on OTT streaming services.


As a result of these changes, revenues are grouped into the following categories: Advertising & Marketing Services, Political, Subscription, Other, and our former business unit Cofactor (sold in December 2016).
The following table summarizes the year-over-year changes in these select revenue categories (in thousands):
 Quarter ended Sept. 30, Nine months ended Sept. 30,
 2017 2016 Change 2017 2016 Change
Advertising & Marketing Services (a)
$277,817
 $330,589
 (16%) $843,175
 $934,977
 (10%)
Political3,783
 38,060
 (90%) 13,387
 64,050
 (79%)
Subscription177,692
 143,676
 24% 540,344
 436,292
 24%
Other4,972
 4,696
 6% 15,797
 13,883
 14%
Cofactor—
 2,596
 ***
 —
 8,031
 ***
Total$464,264
 $519,617
 (11%) $1,412,703
 $1,457,233
 (3%)
            
(a) Includes traditional television advertising, digital advertising as well as revenue from our DMS business.

Revenues decreased $55.4 million, or 11%, in the third quarter of 2017 compared to the same period in 2016. This net decrease was primarily due to a decline in AMS revenue of $52.8 million, or 16%, in the third quarter of 2017. This decline was primarily due to the absence of Olympic revenue in 2017 as compared to $57.3 million in 2016 and lower DMS revenue due to the conclusion of a transition services agreement with Gannett. Partially offsetting the overall AMS decline was an increase in digital revenue, including Premion revenue. Political revenue was down by $34.3 million, due to an expected decrease reflecting the absence of 2016 politically related advertising spending. Partially offsetting these decreases was an increase in subscription revenue of $34.0 million, or 24%, due to the recent renewal of certain retransmission agreements as well as annual rate increases under other existing retransmission agreements.

In the first nine months of 2017, operating revenue decreased $44.5 million, or 3%, compared to the same period in 2016. The net decrease was due to a net decline in AMS revenue of $91.8 million, or 10%, for the first nine months of 2017. The third quarter decline in AMS revenue, described above, drove most of the year-to-date decline. In addition we had lower Super Bowl revenue due to the shift in coverage from our larger CBS station footprint to smaller FOX station footprint (which impacted 2017 results by $9.1 million). These AMS declines were partially offset by an increase in digital revenue, including our Premion revenue. Additionally, political revenue was down $50.7 million for the nine months ended September 30, 2017 due to an expected decrease reflecting the absence of 2016 Presidential election year political spending. Partially offsetting these decreases was an increase in subscription revenue of $104.1 million, or 24%, in the first nine months of 2017 due to the recent renewal of certain retransmission agreements as well as annual rate increases under other existing retransmission agreements.

Cost of Revenues

Cost of revenues increased $35.0 million, or 17%, in the third quarter of 2017 compared to the same period in 2016. The increase was primarily due to a $42.6 million increase in programming costs (primarily driven by 11 of our NBC stations paying reverse compensation payments for first time in 2017). This increase was partially offset by a decline in DMS costs of $7.4 million driven by the conclusion of the transition service agreement with Gannett.

In the first nine months of 2017, cost of revenues increased $106.5 million, or 18%, compared to the same period in 2016. The increase was primarily due to a $135.1 million increase in programming costs (primarily driven by 11 of our NBC stations paying reverse compensation payments for first time in 2017). This increase was partially offset by the absence of $10.8 million of expenses associated with our 2016 voluntary retirement program and a decline in DMS costs of $11.8 million associated with the conclusion of the transition service agreement with Gannett.

Business Units - Selling, General and Administrative Expenses

Business unit selling, general and administrative expenses decreased $12.1 million, or 15%, in the third quarter of 2017 compared to the same period in 2016. The decrease was primarily the result of a $6.0 million decline in DMS selling and advertising expense related to the transition service agreement conclusion. Also contributing to the decline was the absence of $2.6 million of Cofactor expenses, due to its disposition in December 2016.

In the first nine months of 2017, business unit selling, general and administrative expenses decreased $31.6 million, or 13%, compared to the same period in 2016. This decrease was due to a $14.7 million decline in DMS selling and advertising expenses, the absence of $6.5 million of expenses associated with Cofactor, and the absence of $4.0 million of expenses associated with our 2016 voluntary retirement program. These decreases were partially offset by $1.6 million of severance expenses for broadcast employees in 2017.



Corporate General and Administrative Expenses


Corporate general and administrative expenses decreased $3.1$9.2 million or 20%, in the thirdfirst quarter of 20172023 compared to the same period in 2016.2022. The decrease for the quarter was primarily due to the absence of $1.6driven by a $7.5 million of severance expenses from the third quarter of 2016, as well as the continued right sizing of the corporate functionreduction in M&A-related costs incurred in connection with the strategic actions impactingMerger. Additionally, stock-based compensation expense was $1.6 million lower in 2023 driven by a decline in our former Digital Segment.stock price.


During the first nine months of 2017, corporate2023 vs. 2021

Corporate general and administrative expenses decreased $1.4$4.8 million or 3%,in the first quarter of 2023 compared to the same period in 2016. This change2021. The decrease for the quarter was primarily due todriven by the absence in 2023 of $1.6$4.6 million of severance expenses from the third quarter of 2016, partially offset by severance expenseadvisory fees related to activism defense incurred in the first nine monthsquarter of 20172021. Partially offsetting this was an increase of approximately $1.1 million. The remaining difference is attributable to the continued right sizing$2.8 million in M&A-related costs mainly incurred in support of the corporate function in connection withregulatory review of the strategic actions impacting our former Digital Segment.Merger.


Depreciation Expense


2023 vs. 2022

Depreciation expense increased $2.0decreased by $0.3 million or 15%, in the thirdfirst quarter of 20172023 compared to the same period in 2016.2022. The increasedecrease was primarily due to certain assets reaching the end of their assumed useful lives.

2023 vs. 2021

Depreciation expense decreased by $0.8 million in the first quarter of 2023 compared to the same periods in 2021. The decreases were due to certain assets reaching the end of their assumed useful lives.

Amortization of intangible assets

2023 vs. 2022

Amortization expense decreased $1.4 million of additional depreciation related to a change in useful lives of certain broadcasting assets in connection with the FCC channel reassignment process.

In the first nine monthsquarter of 2017, depreciation expense decreased $0.9 million, or 2%, as2023 compared to the same period in 2016. The decrease was primarily due to recent declines in the purchase of property and equipment, offset by accelerated depreciation related to a change in useful lives of certain broadcasting assets.

Amortization Expense

Amortization expense decreased by $0.4 million and $1.4 million in the third quarter and first nine months of 2017, respectively, compared to the same periods in 2016.2022. The decreases were a result ofdue to certain assets associated with previous acquisitions reaching the end of their assumed useful lives.lives and therefore becoming fully amortized.


Asset Impairment and Facility Consolidation Charges2023 vs. 2021


Asset impairment and facility consolidation charges were $7.6Amortization expense decreased $2.2 million in the thirdfirst quarter of 20172023 compared to $15.2 millionthe same period in 2021. The decreases were due to certain assets reaching the end of their assumed useful lives and therefore becoming fully amortized.

Spectrum repacking reimbursements and other, net

2023 vs. 2022

No spectrum repacking reimbursements and other net gains were recognized in the thirdfirst quarter of 2016. In the third quarter of 2017, a few television stations were impacted by hurricanes Harvey and Irma. In particular, Hurricane Harvey caused significant damage to our Houston television station (KHOU); as a result, we recognized $10.2 million in non-cash charges, writing off destroyed equipment and recording an impairment to the value of the building. In addition, we incurred $8.4 million in cash expenses related to repairing the studio and office and providing for additional staffing and operational needs to keep the stations operating during and immediately following these weather emergencies. Partially offsetting these expenses, we received initial insurance proceeds of $11.0 million ($5.0 million was received as of September 30, 2017 and $6.0 million was received in October 2017). The net expense impact from the hurricane of $7.6 million has been recorded in asset impairment and facility consolidation charges. The 2016 charge relates to a goodwill impairment at Cofactor.

During the first nine months of 2017, asset impairment and facility consolidation charges were $11.1 million,2023 compared to $18.9$0.1 million in the same period in 2016.2022. The 2017 charges primarily consisted of net $7.6 million in expenses2022 activity is related to Hurricane Harvey, $1.4 million related toreimbursements received from the consolidation of office space at corporate headquartersFederal Communications Commission (FCC) for required spectrum repacking.

2023 vs. 2021

No spectrum repacking reimbursements and at our DMS business unit, and $2.2 million of non-cash impairment charges incurred by our broadcast stations. The 2016 chargesother net gains were comprised of the third quarter goodwill impairment charge of $15.2 million at Cofactor and a $3.7 million impairment charge related to a long-lived-asset.

Operating Income

Our operating income decreased $69.0 million, or 37%, in the third quarter of 2017 and $107.8 million, or 22%,recognized in the first nine monthsquarter of 2017,2023 compared to net gains of $1.4 million in the same period in 2021. The 2021 activity related to reimbursements received from the FCC.

19

Operating income

2023 vs. 2022

Operating income decreased $35.6 million in the first quarter of 2023 compared to the same periodsperiod in 2016.2022. The decreases weredecrease was driven by the changes in revenue and expenses discussed above. As a result, our consolidated operating margins were 25%above, most notably the decrease in the third quarter of 2017AMS revenue and 28%increase in programming expense.

2023 vs. 2021

Operating income decreased $22.4 million in the first nine months of 2017, compared to 36% in the third quarter of 2016 and 34% in the first nine months of 2016.

Non-Operating Income (Expense)

Non-operating expense decreased $16.0 million, or 23%, in the third quarter of 20172023 compared to the same period in 2016.2021. The decrease was driven by the changes in revenue and expenses discussed above, most notably a decrease in AMS revenue and increases in programming expense, partially offset by an increase in subscription revenue.

Non-operating (expense) income

Non-operating expenses increased $7.6 million in the first quarter of 2023 compared to the same period in 2022. This increase was primarily due to the absence in 2023 of a $20.8 million gain recognized on our available for sale investment in MadHive during the first quarter of 2022. Partially offsetting this increase in expense was $7.5 million of interest income, primarily from interest earned on time-deposit investments. Additionally, interest expense decreased by $0.7 million driven by lower average outstanding debt. Total average outstanding debt was $3.09 billion for the first quarter of 2023, compared to $3.19 billion in the same period of 2022. The weighted average interest rate on outstanding debt was 5.27% for the first quarter of 2023, compared to 5.18% in the same period of 2022.

Provision for income taxes

Income tax expense decreased $12.9 million in the first quarter of 2023 compared to the same period in 2022. The decrease was primarily due to a reduction in transaction costs of $10.9 million primarily associated with costs incurred in the prior year period related to the Cars.com spin-off. Also contributing to the decrease was a decline in interest expense of $5.7 million driven by lower average debt outstanding, due to the pay down of the drawn amounts on the revolving line of credit. The total average outstanding debt was $3.38 billion for the third quarter of 2017, compared to $4.31 billion in the same period of 2016. The weighted average interest rate on total outstanding debt was 5.75% for the third quarter of 2017, compared to 5.21% in the same period of 2016.



During the first nine months of 2017, non-operating expenses decreased $3.7 million, or 2%, compared to the same period in 2016. The decrease was primarily due to lower interest expense of $13.3 million, partially offset by increased costs associated with the strategic actions of $3.4 million (primarily the Cars.com spin-off) and a $5.8 million loss associated with the write-off of a note receivable from one of our equity method investments. The lower interest expense was due to lower average debt outstanding. The total average outstanding debt was $3.75 billion during the first nine months of 2017, compared to $4.28 billion in the same period of 2016. The weighted average interest rate on total outstanding debt was 5.51% for the first nine months of 2017, compared to 5.32% in the same period of 2016.

Income Tax Expense

Income tax expense decreased $27 million, or 70%, in the third quarter of 2017 as compared to the same period in 2016, and decreased $37.2 million, or 40%, in the first nine months of 2017 compared to the same period in 2016. The decrease in Income tax expense is primarily due to a declinedecreases in net income before tax, as well as a favorable deferred tax adjustment related to a previously-disposed business.tax. Our reported effective income tax rate was 18.4% in the third quarter of 2017, compared to 33.4% for continuing operations for the third quarter of 2016. The reported effective income tax rate was 27.5%23.4% for the first nine monthsquarter of 2017,2023, compared to 30.3%25.0% for the same period in 2016.first quarter of 2022. The tax ratesrate for the thirdfirst quarter and first nine months of 2017 are2023 is lower than the comparable 2016 ratesamount in 2022 primarily due to a valuation allowance recorded on minority investments and higher nondeductible transaction costs incurred in 2022. Partially offsetting the reductiondecrease were tax benefits realized in net income before tax2022 from the utilization of capital loss carryforwards in connection with certain transactions and the deferred tax adjustment mentioned above.release of the associated valuation allowance.


Income from continuing operationsNet income attributable to TEGNA Inc.


Income from continuing operationsNet income attributable to TEGNA Inc. was $50.8$104.3 million, or $0.23$0.46 per diluted share, in the thirdfirst quarter of 20172023 compared to $76.7$134.2 million, or $0.35$0.60 per diluted share, during the same period in 2016. For the first nine months of 2017, we reported net income from continuing operations of $144.7 million, or $0.66 per diluted share, compared to $211.6 million, or $0.96 per diluted share, for the same period in 2016.2022. Both income from continuing operations and earnings per share were affected by the factors discussed above.


The weighted average number of diluted shares outstanding in the both the third quarter of 2017 and 2016 was 218.1 million. The weighted average number of dilutedcommon shares outstanding in the first nine months quarter of 2017 decreased by 2.72023 and 2022 were 224.8 million shares to 217.8and 223.2 million, from 220.5 million in the same period in 2016.respectively.
20

Results from Operations - Non-GAAP Information


Presentation of Non-GAAP information


We use 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 our Board of Directors use the non-GAAP financial measures for purposes of evaluating business unit and consolidated company performance. Furthermore, the ExecutiveLeadership Development and Compensation Committee of our Board of Directors uses non-GAAP measures such as Adjusted EBITDA, non-GAAP net income, non-GAAP EPS and free cash flow to evaluate management’s performance. Therefore, we believe that each of the non-GAAP measures presented provides useful information to investors and other stakeholders by allowing them to view our business through the eyes of management and our Board of Directors, facilitating comparisons of results across historical periods and focus on the underlying ongoing operating performance of our business. We also believe these non-GAAP measures are frequently used by investors, securities analysts and other interested parties in their evaluation of our business and other companies in the broadcast industry.

We discuss in this Form 10-Q non-GAAP financial performance measures that exclude from our reported GAAP results the impact of “special items” consistingwhich are described in detail below in the section titled “Discussion of severance expense, charges related to asset impairmentSpecial Charges and facility consolidations, costs associated with the Cars.com spin-off transaction, and certain tax benefits associated with the Cars.com spin-off and sale of CareerBuilder.Credits Affecting Reported Results.” We believe that such expenses charges and gains are not indicative of normal, ongoing operations. SuchWhile these items should not be disregarded in evaluation of our earnings performance, it is useful to exclude such items when analyzing current results and trends compared to other periods as these items can vary significantly from period to period and are significantly impacted by the timing and nature of these events.depending on specific underlying transactions or events that may occur. Therefore, while we may incur or recognize these types of expenses, charges and gains 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.


We discuss Adjusted EBITDA (with and without corporate expenses), a non-GAAP financial performance measure that we believe offers a useful view of the overall operation of our businesses. We define Adjusted EBITDA as net income from continuing operationsattributable to TEGNA before (1) net loss (income) attributable to redeemable noncontrolling interest, expense, (2) income taxes, (3) interest expense, (4) equity income (losses)loss in unconsolidated investments, net, (4)(5) other non-operating items, such as spin-off transaction expensesnet, (6) M&A-related costs, (7) spectrum repacking reimbursements and investment income, (5) severance expense, (6) facility consolidation charges, (7) impairment charges,other, net, (8) depreciation and (9) amortization. We believe these adjustments facilitate company-to-company operating performance comparisons by removing potential differences caused by variations unrelated to operating performance, such as capital structures (interest expense), income taxes, and the age and book appreciation of property and equipment (and related depreciation expense). The most directly comparable GAAP financial measure to Adjusted EBITDA is Net income from continuing operations.attributable to TEGNA. 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 alternativealternate 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.

We also consider adjusted revenues to be an important non-GAAP financial measure. Our adjusted revenue is calculated by taking total company revenues on a GAAP basis and adjusting it to exclude (1) estimated incremental Olympic and Super Bowl revenue, (2) Political revenues, (3) revenues from a previously sold business (Cofactor), and (4) revenues associated with a discontinued portion of our DMS business. These adjustments are made to our 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.


We also discuss free cash flow, a non-GAAP liquidity measure.performance measure that the Board of Directors uses to review the performance of the business. Free cash flow is definedreviewed by the Board of Directors as “net cash flow from operating activities” as reported ona percentage of revenue over a trailing two-year period (reflecting both an even and odd year reporting period given the statementpolitical cyclicality of cash flows reduced by “purchase of property and equipment”our business). We believe thatThe most directly comparable GAAP financial measure to free cash flow is a useful measure for management and investorsNet income attributable 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 our cash balance, or use in other discretionary activities. We use freeTEGNA. Free cash flow to monitor cash availableis calculated as non-GAAP Adjusted EBITDA (as defined above), further adjusted by adding back (1) stock-based compensation, (2) non-cash 401(k) company match, (3) syndicated programming amortization, (4) dividends received from equity method investments, (5) reimbursements from spectrum repacking and (6) proceeds from company-owned life insurance policies. This is further adjusted by deducting payments made for repayment(1) syndicated programming, (2) pension, (3) interest, (4) taxes (net of indebtednessrefunds) and in discussions with the investment community.(5) purchases of property and equipment. Like Adjusted EBITDA, free cash flow is not intended to be a measure of cash flow available for management’s discretionary use.

21

Discussion of special chargesSpecial Charges and credits affecting reported resultsCredits Affecting Reported Results


Our results for the quarter and first nine months ended September 30, 2017 included the following items we consider “special items” that, while at times recurring, can vary significantly from period to period:

Quarter ended March 31, 2023:

•M&A-related costs.

Quarter ended March 31, 2022:

•Spectrum repacking reimbursements and are not indicativeother, net consisting of our normal ongoing operations:gains due to reimbursements from the FCC for required spectrum repacking;

•M&A-related costs;
Operating asset impairment and facility consolidation charges related to damage caused by Hurricane Harvey and the consolidation of office space at corporate headquarters and at our DMS business unit;
•Other non-operating items consisting of a gain recognized on an available-for-sale investment and an impairment charge related to another investment; and
•Tax expense, net, associated with costs of the spin-off of our Cars.com business unit, charitable donations madeestablishing a valuation allowance on a deferred tax asset related to the TEGNA Foundation, non-cash asset impairment charges associated with write off of a note receivable from an equity method investment;investment.
A special tax benefit related to deferred tax remeasurement attributable to the spin-off of our Cars.com business unit and a deferred tax adjustment related to a previously-disposed business; and
Severance charges which included payroll and related benefit costs.
Our results for the quarter and first nine months ended September 30, 2016 included the following special items:
22

Severance charges primarily related to a voluntary retirement program at our broadcast stations (which includes payroll and related benefit costs);
Non-cash asset impairment charges associated with goodwill, an operating asset, and equity method investments; and
Non-operating costs associated with the spin-off of our Cars.com business unit and acquisition-related costs.

Reconciliations of certain line items impacted by special items to the most directly comparable financial measure calculated and presented in accordance with GAAP on our consolidated statementsConsolidated Statements of incomeIncome follow (in thousands, except per share amounts):
Special Items
Quarter ended Mar. 31, 2023Quarter ended Mar. 31, 2023GAAP
measure		M&A-related costsNon-GAAP measure
   Special Items  
Quarter ended September 30, 2017 
GAAP
measure
 Operating asset impairment and facility consolidation Other non-operating items Tax benefits Non-GAAP measure
Corporate - General and administrative expensesCorporate - General and administrative expenses$12,100 $(2,766)$9,334 
          
Operating expenses $347,403
 $(7,553) $—
 $—
 $339,850
Operating expenses566,772 (2,766)564,006 
Operating income 116,861
 7,553
 —
 —
 124,414
Operating income173,555 2,766 176,321 
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
Income before income taxes135,823 2,766 138,589 
Provision for income taxes 11,447
 2,780
 629
 8,086
 22,942
Provision for income taxes31,819 181 32,000 
Income from continuing operations 50,754
 4,773
 2,059
 (8,086) 49,500
Earnings from continuing operations per share - diluted (a)
 $0.23
 $0.02
 $0.01
 $(0.04) $0.23
Net income attributable to TEGNA Inc.Net income attributable to TEGNA Inc.104,303 2,585 106,888 
Earnings per share - dilutedEarnings per share - diluted$0.46 $0.01 $0.47 
Special Items
Quarter ended Mar. 31, 2022Quarter ended Mar. 31, 2022GAAP
measure		M&A-related costsSpectrum repacking reimbursements and otherOther non-operating itemsSpecial tax itemsNon-GAAP measure
Corporate - General and administrative expensesCorporate - General and administrative expenses$21,320 $(10,234)$— $— $— $11,086 
Spectrum repacking reimbursements and other, netSpectrum repacking reimbursements and other, net(58)— 58 — — — 
Operating expensesOperating expenses564,986 (10,234)58 — — 554,810 
Operating incomeOperating income209,137 10,234 (58)— — 219,313 
Other non-operating items, netOther non-operating items, net17,319 — — (18,308)— (989)
Total non-operating expensesTotal non-operating expenses(30,112)— — (18,308)— (48,420)
Income before income taxesIncome before income taxes179,025 10,234 (58)(18,308)— 170,893 
Provision for income taxesProvision for income taxes44,738 31 (14)168 (7,117)37,806 
Net income attributable to TEGNA Inc.Net income attributable to TEGNA Inc.134,234 10,203 (44)(18,476)7,117 133,034 
Earnings per share - diluted (a)
Earnings per share - diluted (a)
$0.60 $0.05 $— $(0.08)$0.03 $0.59 
(a) Per share amounts do not sum due to rounding.          
(a) Per share amounts do not sum due to rounding.
23
    Special Items  
Quarter ended September 30, 2016 
GAAP
measure
 Severance expense Operating asset impairment and facility consolidation Other non-operating items Non-GAAP measure
           
Operating expenses $333,766
 $(2,870) $(15,218) $—
 $315,678
Operating income 185,851
 2,870
 15,218
 —
 203,939
Other non-operating items (11,874) —
 —
 13,161
 1,287
Total non-operating expense (70,673) —
 —
 13,161
 (57,512)
Income before income taxes 115,178
 2,870
 15,218
 13,161
 146,427
Provision for income taxes 38,441
 1,112
 5,900
 3,515
 48,968
Income from continuing operations 76,737
 1,758
 9,318
 9,646
 97,459
Earnings from continuing operations per share - diluted (a)
 $0.35
 $0.01
 $0.04
 $0.04
 $0.45
(a) Per share amounts do not sum due to rounding.


    Special Items  
Nine Months Ended September 30, 2017 
GAAP
measure
 Severance expense Operating asset impairment Other non-operating items Tax benefits Non-GAAP measure
             
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
Income from continuing operations 144,682
 1,879
 6,982
 25,070
 (11,724) 166,889
Earnings from continuing operations per share - diluted $0.66
 $0.01
 $0.03
 $0.12
 $(0.05) $0.77
             
    Special Items  
Nine Months Ended September 30, 2016 
GAAP
measure
 Severance expense Operating asset impairment Equity investment impairment Other non-operating items Non-GAAP measure
             
Operating expenses $959,344
 $(20,118) $(18,946) $—
 $—
 $920,280
Operating income 497,889
 20,118
 18,946
 —
 —
 536,953
Equity (loss) income in unconsolidated charges (2,763) —
 —
 1,869
 —
 (894)
Other non-operating items (16,029) —
 —
 —
 16,324
 295
Total non-operating expense (194,236) —
 —
 1,869
 16,324
 (176,043)
Income before income taxes 303,653
 20,118
 18,946
 1,869
 16,324
 360,910
Provision for income taxes 92,038
 7,799
 7,345
 725
 4,583
 112,490
Income from continuing operations 211,615
 12,319
 11,601
 1,144
 11,741
 248,420
Earnings from continuing operations per share - diluted $0.96
 $0.06
 $0.05
 $0.01
 $0.05
 $1.13
             







Adjusted RevenuesEBITDA - Non-GAAP


Reconciliations of adjusted revenuesAdjusted EBITDA to our revenuesnet income presented in accordance with GAAP on our Consolidated Statements of Income are presented below (in thousands):
Quarter ended Mar. 31,
20232022Change
Net income attributable to TEGNA Inc. (GAAP basis)$104,303 $134,234 (22 %)
(Less) Plus: Net (loss) income attributable to redeemable noncontrolling interest(299)53 ***
Plus: Provision for income taxes31,819 44,738 (29 %)
Plus: Interest expense42,906 43,620 (2 %)
Plus: Equity loss in unconsolidated investments, net237 3,811 (94 %)
Less: Other non-operating items, net(5,411)(17,319)(69 %)
Operating income (GAAP basis)173,555 209,137 (17 %)
Plus: M&A-related costs2,766 10,234 (73 %)
Less: Spectrum repacking reimbursements and other, net— (58)***
Adjusted operating income (non-GAAP basis)176,321 219,313 (20 %)
Plus: Depreciation15,049 15,305 (2 %)
Plus: Amortization of intangible assets13,582 15,000 (9 %)
Adjusted EBITDA (non-GAAP basis)204,952 249,618 (18 %)
Corporate - General and administrative expense (non-GAAP basis)9,334 11,086 (16 %)
Adjusted EBITDA, excluding Corporate (non-GAAP basis)$214,286 $260,704 (18 %)
*** Not meaningful
 Quarter ended Sept. 30, Nine months ended Sept. 30,
 2017 2016 Change 2017 2016 Change
            
Advertising & Marketing Services (a)
$277,817
 $330,589
 (16.0%) $843,175
 $934,977
 (9.8%)
Political3,783
 38,060
 (90.1%) 13,386
 64,050
 (79.1%)
Subscription177,692
 143,676
 23.7% 540,345
 436,292
 23.8%
Other4,972
 4,696
 5.9% 15,797
 13,883
 13.8%
Cofactor—
 2,596
 ***
 —
 8,031
 ***
Total company revenues (GAAP basis)$464,264
 $519,617
 (10.7%) $1,412,703
 $1,457,233
 (3.1%)
Factors impacting comparisons:           
     Estimated incremental Olympic and Super Bowl$—
 $(28,300) ***
 $—
 $(37,210) ***
     Political(3,783) (38,060) (90.1%) (13,386) (64,050) (79.1%)
     CoFactor (sold in December 2016)—
 (2,596) ***
 —
 (8,031) ***
     Discontinued digital marketing services—
 (13,893) ***
 (16,673) (40,509) (58.8%)
Total company adjusted revenues$460,481
 $436,768
 5.4% $1,382,644
 $1,307,433
 5.8%
            
(a) Includes traditional advertising, digital advertising as well as revenue from our DMS businesses.


Excluding the impacts of Political revenue, impacts from the discontinued DMS transition services agreement, the absence of Cofactor revenue, and estimated prior year incremental Olympic and Super Bowl revenue, total company adjusted revenues on a comparable basis increased five percent in the third quarter and six percent inIn the first nine monthsquarter of 2017 compared to the same periods in 2016.



2023 Adjusted EBITDA - Non-GAAP
Reconciliations of Adjusted EBITDA to net income from continuing operations attributable to TEGNA Inc. presented in accordance with GAAP on our Consolidated Statements of Income are presented below (in thousands):
 Quarter ended Sept. 30, Nine months ended Sept. 30,
 2017 2016 Change 2017 2016 Change
            
Net income from continuing operations (GAAP basis)$50,754
 $76,737
 (34%) $144,682
 $211,615
 (32%)
Provision for income taxes11,447
 38,441
 (70%) 54,855
 92,038
 (40%)
Interest expense51,855
 57,601
 (10%) 162,113
 175,444
 (8%)
Equity loss in unconsolidated investments, net(866) 1,198
 ***
 1,549
 2,763
 (44%)
Other non-operating items3,671
 11,874
 (69%) 26,853
 16,029
 68%
Operating income (GAAP basis)116,861
 185,851
 (37%) 390,052
 497,889
 (22%)
Severance expense—
 2,870
 ***
 3,053
 20,118
 (85%)
Asset impairment and facility consolidation charges7,553
 15,218
 (50%) 11,086
 18,946
 (41%)
Adjusted operating income (non-GAAP basis)124,414
 203,939
 (39%) 404,191
 536,953
 (25%)
Depreciation15,186
 13,212
 15% 41,721
 42,653
 (2%)
Amortization of intangible assets5,395
 5,775
 (7%) 16,172
 17,542
 (8%)
Adjusted EBITDA (non-GAAP basis)144,995
 222,926
 (35%) 462,084
 597,148
 (23%)
Corporate - General and administrative expense, exclusive of depreciation (non-GAAP basis)12,881
 14,470
 (11%) 41,402
 42,308
 (2%)
Adjusted EBITDA, excluding Corporate (non-GAAP basis)$157,876
 $237,396
 (33%) $503,486
 $639,456
 (21%)
Third quarter 2017 adjusted EBITDA margin was 29% without corporate expense or 28% with corporate expense, compared to first quarter of 2022 Adjusted EBITDA margin of 34% without corporate expense or 31%32% with corporate. Our total Adjusted EBITDA decreased $77.9 millionor35% in the third quarter of 2017 compared to 2016 and decreased $135.1 million or 23% for the first nine months of 2017 from the prior year comparable period. The decrease wascorporate expense. These margin decreases were primarily driven by higherthe operational factors discussed above within the revenue and operating expense fluctuation explanation sections, most notably, the decrease in AMS revenue and increase in programming costs (dueexpenses.

24

Free Cash Flow Reconciliation

Reconciliation from “Net income” to 11 of our NBC stations which began making reverse compensation payments“Free cash flow” follow (in thousands):

Two-year period ended Mar. 31,
20232022
Net income attributable to TEGNA Inc. (GAAP basis)$1,099,110$1,007,659
Plus: Provision for income taxes334,056313,387
Plus: Interest expense356,093382,604
Plus: M&A-related costs27,02113,972
Plus: Depreciation125,189130,126
Plus: Amortization120,715129,485
Plus: Stock-based compensation56,92363,073
Plus: Company stock 401(k) contribution36,06333,811
Plus: Syndicated programming amortization136,964141,999
Plus: Workforce restructuring expense—1,021
Plus: Advisory fees related to activism defense12,01232,059
Plus: Cash dividend from equity investments for return on capital4,27611,598
Plus: Cash reimbursements from spectrum repacking3,84210,665
Plus: Net income attributable to redeemable noncontrolling interest1,4571,390
Plus: Reimbursement from Company-owned life insurance policies1,9291,005
Plus (Less): Equity loss (income) in unconsolidated investments, net13,09412,142
Less: Spectrum repacking reimbursements and other, net(1,207)(4,805)
(Less) Plus: Other non-operating items, net(33,337)(9,385)
Less: Syndicated programming payments(140,650)(150,211)
Less: Income tax payments, net of refunds(351,206)(263,012)
Less: Pension contributions(12,149)(10,121)
Less: Interest payments(345,153)(389,392)
Less: Purchases of property and equipment(104,069)(100,849)
Free cash flow (non-GAAP basis)$1,340,973$1,358,221
Revenue$6,286,614$6,018,807
Free cash flow as a % of Revenue21.3 %22.6 %
Our free cash flow, a non-GAAP performance measure, was $1.34 billion and $1.36 billion for the first time), the absence of Olympic revenue in 2017two-year periods ended March 31, 2023 and the expected decline in political revenue in 2017.

Certain Matters Affecting Future Operating Results

The following items will affect year-over-year comparisons for 2017 results:

2022, respectively.
Revenues - In the fourth quarter of 2017 revenue will be impacted primarily due to the absence of $82 million in net political revenues compared to the fourth quarter of 2016, and the absence of $16 million of DMS revenue due to the conclusion of a transition services agreement with Gannett.
25

Based on current trends, we expect total company revenues on a GAAP basis compared to the prior year quarter to be down in the high-single to low double-digits. Adjusting to remove political revenue and revenue related to the terminated transition services agreement, we expect our fourth quarter adjusted company revenues to be up in the high single-digit to low double-digits year-over-year.

Programming Costs - Beginning in January 2017, 11 of our NBC stations began making reverse compensation payments for the first time. As such, 2017 is an unusual year as there will be an unfavorable gap between the increase in subscription revenue we earn from multichannel video programming distributors (MVPD), compared to the increase in fees we will pay our affiliates. At the end of 2016, we renegotiated several new subscriptions agreements with major MVPD carriers, and as a result, we have reduced our net retransmission gap in 2017 to approximately $31 million to $34 million. Further, we expect our strategic initiatives launched in 2016 (including Premion, centralized pricing initiatives, and Hatch) will more than offset the remaining net retransmission gap in 2017.

Income Taxes - After the spin-off of Cars.com and disposition of CareerBuilder, the recurring effective income tax rate for 2018 is anticipated to be approximately 35%. This estimated effective income tax rate is higher than that for the third quarter and the first nine months of 2017 due to tax benefits associated with the spin-off of Cars.com and other non-recurring items realized in 2017.



Liquidity, Capital Resources and Cash Flows


Our strongoperations have historically generated positive cash generation capability and financial condition, togetherflow which, along with our significant borrowing capacityavailability under our existing revolving credit agreement, arefacility and cash and cash equivalents on hand, have been sufficient to fund our capital expenditures, interest payments, dividends, share repurchases, investments in strategic initiatives and other operating requirements. Over the longer term, we

We paid dividends totaling $21.4 million and $21.2 million in first three months of 2023 and 2022, respectively. We expect to continue to fundpay our regular quarterly dividend of $0.095 per share through the closing of the Merger, which is the maximum rate and frequency permitted by the Merger Agreement. The Merger Agreement also does not permit us to repurchase our common stock. As a result of these two restrictions, our cash balance has increased from $551.7 million at the end of 2022 to $683.2 million at the end of the first quarter of 2023. During the first quarter of 2023, we primarily deployed surplus cash in time deposit investments with several financial institutions, given the limitations under the Merger Agreement.

As of March 31, 2023, we were in compliance with all covenants contained in our debt maturities, acquisitionsagreements and investments through a combination of cash flows from operations, borrowings undercredit facility. Our leverage ratio, calculated in accordance with our revolving credit agreement, and funds raisedwas 2.45x, below the maximum permitted leverage ratio of 4.50x. The leverage ratio is calculated using annualized adjusted EBITDA (as defined in the capital markets. Asagreement) for the trailing eight quarters. We believe that we summarize below, during 2017 we have completed several strategic actions that have positioned us to be able to pursue strategic acquisition opportunities that may develop in our sector, invest in new content and revenue initiatives, and grow revenue in fiscal year 2018.
During the second quarter we completed our spin-off of Cars.com which resulted in a one-time tax-free cash distribution of $650.0 million to TEGNA. We used $609.9 million of the tax-free distribution proceeds to fully pay down our then outstanding revolving credit agreement borrowings.
On July 31, 2017, we sold our majority ownership interest in CareerBuilder. Our share of the pre-tax net cash proceeds from the sale was $198.3 million, net of cash transferred of $36.6 million. Additionally, prior to the sale, CareerBuilder issued a final dividend to its selling shareholders, of which $25.8 million was retained by TEGNA. On October 16 2017, we used the net proceeds from the CareerBuilder sale, the remaining cash distribution proceeds from Cars.com of $40.1 million, and cash on hand to early retire $280.0 million of principal of unsecured notes due in October 2019.

On August 1, 2017, we amended our Amended and Restated Competitive Advance and Revolving Credit Agreement. Under the amended terms, our maximum total leverage ratio will remain at 5.0x through June 30, 2018, after which, as amended, it will be reduced to 4.75x through June 2019 and then to 4.5x untilcompliant with all covenants for the expirationforeseeable future.

As of the credit agreement on June 29, 2020. Lastly, on September 19, 2017, we announced that our Board of Directors authorized a new share repurchase program for up to $300 million of our common stock over the next three years.

At the end of the third quarter of 2017,March 31, 2023, our total debt was $3.32$3.07 billion, and cash and cash equivalents totaled $383.4 million. As of September 30, 2017,$683.2 million, and we had unused borrowing capacity of $1.5$1.49 billion under our revolving credit facility. We intend to continue to invest in organic and strategic growth opportunities and also intend to maintain the financial flexibility to pursue strategic acquisitions when appropriate. Our debt consists of unsecured notes which have fixed interest rates.

Our financial and operating performance, as well as our ability to generate sufficient cash flow to maintain compliance with credit facility covenants, are subject to certain risk factors; see the Part II. Other Information,factors. See Item 1A. Risk“Risk Factors, discussion below.” in our 2022 Annual Report on Form 10-K for further discussion. We expect our existing cash and cash equivalents, cash flow from our operations, and borrowing capacity under the revolving credit facility will be more than sufficient to satisfy our recurring contractual commitments, debt service obligations, capital expenditure requirements, and other working capital needs for the next twelve months and beyond.




Cash Flows


The following table provides a summary of our cash flow information followed by a discussion of the key elements of our cash flow (in thousands):
Three months ended Mar. 31,
20232022
Balance of cash and cash equivalents beginning of the period$551,681 $56,989 
Operating activities:
    Net income104,004 134,287 
    Depreciation, amortization and other non-cash adjustments38,120 31,641 
    Pension expense, net of contributions1,416 (585)
    Decrease (increase) in trade receivables20,615 (120)
    (Decrease) increase in interest and taxes payable(1,627)13,663 
    Other, net7,859 17,374 
Cash flow from operating activities170,387 196,260 
Investing activities:
Purchase of property and equipment(2,845)(5,538)
All other investing activities(1,277)(1,792)
Cash flow used for investing activities(4,122)(7,330)
Cash flow used for financing activities(34,767)(202,603)
Increase in cash and cash equivalents131,498 (13,673)
Balance of cash and cash equivalents end of the period$683,179 $43,316 
26

 Nine months ended Sept. 30,
 2017 2016
    
Cash and cash equivalents from continuing operations, beginning of period$15,879
 $26,096
Cash and cash equivalents from discontinued operations, beginning of period61,041
 103,104
     Balance of cash and cash equivalents, beginning of the period76,920
 129,200
    
Operating activities:   
    Net (loss) income(88,579) 343,756
    Loss on write down of CareerBuilder342,900
 —
    Depreciation, amortization and other non-cash adjustments153,242
 197,025
    Pension (contributions), net of expense(12,547) 2,135
    Spectrum channel share agreement proceeds32,588
 —
    Other, net(76,421) (88,153)
Net cash flows from operating activities351,183
 454,763
Net cash from (used for) investing activities152,499
 (273,309)
Net cash used for financing activities(197,248) (203,325)
Increase (decrease) in cash and cash equivalents306,434
 (21,871)
    
Cash and cash equivalents from continuing operations, end of period383,354
 19,185
Cash and cash equivalents from discontinued operations, end of period—
 88,144
     Balance of cash and cash equivalents, end of the period$383,354
 $107,329

Operating Activities activities -Cash flow from operating activities was $351.2$170.4 million for the ninethree months ended September 30, 2017,March 31, 2023, compared to $454.8 million for the nine months ended September 30, 2016. The decrease in net cash flow from operating activities was primarily due to higher programming costs of $135.1 million (primarily due to the NBC affiliation agreement), the decline in political revenue of $50.7 million, and the absence of operating cash flow Cars.com and CareerBuilder following their spin-off and sale, respectively. These decreases were partially offset by declines in tax payments of $40.6 million and interest payments of $19.8 million. Also partially offsetting the net operating cash flow decrease was a cash inflow received in 2017 of $32.6 million from a spectrum channel sharing agreement.

Investing Activities -Cash flow from investing activities totaled $152.5 million for the nine months ended September 30, 2017, compared to cash used for investing activities of $273.3 million for the same period 2016. The 2017 net cash inflow was primarily a result of the sale of the majority of our ownership in CareerBuilder, which provided $198.3 million of proceeds, net of cash transferred. Additionally, we had cash inflow of $15.1 million from the sale of assets, primarily comprised of proceeds of $14.6 million from the sale of Gannett Co., Inc., common stock. These inflows were partially offset by purchases of property and equipment of $63.8 million in 2017.

The 2016 net cash used for investing activities of $273.3 million was primarily comprised of $196.8 million paid for the acquisitions of businesses (net of cash acquired) and purchase of property and equipment in the amount of $68.6 million.

Financing Activities - Cash used for financing activities totaled $197.2 million for the nine months ended September 30, 2017, compared to $203.3 million net outflow for the same period in 2016. The 2017 net outflow of cash for financing activities was primarily due to debt activity and dividends. With regards to 2017 debt activity, prior to the completion of the spin-off, Cars.com borrowed approximately $675.0 million under a revolving credit facility agreement, while incurring $6.2 million of debt issuance costs. The proceeds were used to make a one time tax-free cash distribution of $650.0 million from Cars.com to TEGNA. We used most of the cash received to pay down our then outstanding revolving credit balance of $609.9 million. Total net payments on the revolving credit facility in the first nine months of 2017 were $635.0 million. We used an additional $99.2 million to pay down other existing debt. Additionally, in 2017 we made dividend payments of $75.1 million, paid a final dividend to the noncontrolling owners of CareerBuilder of $23.0 million, and transferred $20.1 million to Cars.com in connection with the spin-off.



The 2016 net financing outflow of $203.3 million was primarily a result of stock repurchases of $150.9 million and dividend payments of $91.6 million. These outflows were partially offset by a net debt inflow of $58.7 million primarily comprised of $310.0 million of borrowings which were partially offset by debt repayments of $249.6 million.

Non-GAAP Liquidity Measure

Our free cash flow, a non-GAAP liquidity measure, was $287.3 million for the first nine months of 2017 compared to $386.2$196.3 million for the same period in 2016. Our free2022. Driving the decrease in operating cash flow was a $30.3 million decline in net income primarily a result of a decline in AMS and political revenue and an increase in programming expense in the first quarter of 2023 as compared to 2022.

Investing activities -Cash flow used for investing activities was $4.1 million for the three months ended March 31, 2023, compared to $7.3 million for the same period in 2022. The decrease of $3.2 million was primary due to a $2.7 million reduction in capital expenditures in the first ninethree months of 20172023 as compared to the same period in 2022.

Financing activities - Cash flow used for financing activities was lower than$34.8 million for the three months ended March 31, 2023, compared to $202.6 million for the same period in 2022. The change was primarily due to our revolving credit facility which had no net repayments in the first ninethree months of 2016 because2023 as compared to net repayments of $166.0 million in the same factors affecting cash flow from operating activities discussed above. Free cash flow, which we reconcile to “Net cash flow from operating activities,” is cash flow from operating activities reduced by “Purchasefirst three months of property and equipment.” We believe 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 our operations to fund investments in new and existing businesses, return cash to shareholders under our capital program, repay indebtedness or to use in other discretionary activities.2022.

Reconciliations from “Net cash flow from operating activities” to “Free cash flow” follow (in thousands):
     Nine months ended September 30,
     2017 2016
        
Net cash flow from operating activities    $351,183
 $454,763
Purchase of property and equipment    (63,846) (68,577)
Free cash flow
 
 $287,337
 $386,186
Certain Factors Affecting Forward-Looking Statements


Certain statements in this Quarterly Report on Form 10-Q containthat do not describe historical facts may constitute forward-looking statements regarding business strategies, market potential,within the meaning of the “safe harbor” provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on a number of assumptions about future financial performanceevents and other matters. The words “believe,” “expect,” “estimate,” “could,” “should,” “intend,” “may,” “plan,” “seek,” “anticipate,” “project” and similar expressions, among others, generally identify “forward-looking statements”. These forward-looking statements are subject to certainvarious risks, uncertainties and uncertaintiesother factors that couldmay cause actual results and events to differ materially from those anticipatedthe views, beliefs, projections and estimates expressed in the forward-looking statements, includingsuch statements. These risks, uncertainties and other factors include, but are not limited to, those described underwithin Part I, Item 1A.1A “Risk Factors” in our 2016 Annual Report on Form 10-K.

Our actual financial results may be different10-K for the fiscal year ended December 31, 2022 and our Quarterly Reports on Form 10-Q, including the following: (1) the timing, receipt and terms and conditions of any required governmental or regulatory approvals of the proposed transaction and the related transactions involving the parties that could reduce the anticipated benefits of or cause the parties to abandon the proposed transaction, (2) risks related to the satisfaction of the conditions to closing the proposed transaction (including the failure to obtain necessary regulatory approvals), and the related transactions involving the parties, in the anticipated timeframe or at all, (3) the risk that any announcements relating to the proposed transaction could have adverse effects on the market price of the Company’s common stock, (4) disruption from those projectedthe proposed transaction could make it more difficult to maintain business and operational relationships, including retaining and hiring key personnel and maintaining relationships with the Company’s customers, vendors and others with whom it does business, (5) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement entered into pursuant to the proposed transaction or of the transactions involving the parties, (6) risks related to disruption of management’s attention from the Company’s ongoing business operations due to the inherent natureproposed transaction, (7) significant transaction costs, (8) the risk of projections. Given these uncertainties,litigation and/or regulatory actions related to the proposed transaction or unfavorable results from currently pending litigation and proceedings or litigation and proceedings that could arise in the future, (9) other business effects, including the effects of industry, market, economic, political or regulatory conditions, and (10) information technology system failures, data security breaches, data privacy compliance, network disruptions, and cybersecurity, malware or ransomware attacks.

Readers are cautioned not to place undue reliance on forward-looking statements should not be reliedmade by or on in making investment decisions. The forward-looking statements contained in this Form 10-Q speakbehalf of the Company. Each such statement speaks only as of the date of its filing. Except where requiredday it was made. We undertake no obligation to update or to revise any forward-looking statements. The factors described above cannot be controlled by applicable law, we expressly disclaim a duty to provide updates to forward-looking statements after the date ofour Company. When used in this Quarterly Report on Form 10-Q, the words “believes,” “estimates,” “plans,” “expects,” “should,” “could,” “outlook,” and “anticipates” and similar expressions as they relate to reflect subsequent events, changed circumstances, changes in expectations,our Company or the estimates and assumptions associated with them. The forward-lookingmanagement are intended to identify forward looking statements. Forward-looking statements in this Quarterly Report on Form 10-Q are intended to be subject tomay include, without limitation: statements about the safe harbor protection provided bypotential benefits of the federal securities laws.proposed acquisition, anticipated growth rates, the Company’s plans, objectives, expectations, and the anticipated timing of closing the proposed transaction.
27

Item 3. Quantitative and Qualitative Disclosures about Market Risk


For quantitative and qualitative disclosures about market risk, refer to the following section of our 20162022 Annual Report on Form 10-K: “Item 7A. Quantitative and Qualitative Disclosures about Market Risk.” Our exposureexposures to market risk has been reducedhave not changed materially since December 31, 2016, due2022.

As of March 31, 2023, we did not have any floating interest obligations outstanding and had unused borrowing capacity of $1.49 billion under our $1.51 billion revolving credit facility, which expires in August 2024. Any amounts borrowed under the revolving credit facility in the future are subject to a variable rate. Refer to Note 8 to the sale of our majority ownership in CareerBuilder, which has decreased our exposure to changes in foreign exchange rates related to CareerBuilder’s international operations.

As of September 30, 2017, we had $379.2 million in long-term floating rate obligations outstanding. These obligations fluctuate with market interest rates. By way of comparison, a 50 basis points increase or decrease incondensed consolidated financial statements for information regarding the average interest rate for these obligations would result in a change in annualized interest expense of approximately $1.9 million. The fair value of our total debt, based on bid and ask quotes for the related debt, totaled $3.49 billion as of September 30, 2017, and $4.19 billion as of December 31, 2016.long-term debt.




Item 4. Controls and Procedures


Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of the Company’sCompany’s disclosure controls and procedures as of September 30, 2017.March 31, 2023. Based on that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are effective, as of September 30, 2017,March 31, 2023, to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 are recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.


There have been no material changes in our internal controls or in other factors during the fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Other than ordinary, routine litigation incidentalSee Note 9 to the condensed consolidated financial statements for information regarding our business, neither we nor any of our subsidiaries currently is party to any material pending legal proceeding.proceedings.


Item 1A. Risk Factors


While we attempt to identify, manage and mitigate risks and uncertainties associated with our business, some level of risk and uncertainty will always be present. “Item 1A. Risk Factors” of our 20162022 Annual Report on Form 10-K describes the risks and uncertainties that we believe may have the potential to materially affect our business, results of operations, financial condition, cash flows, projected results and future prospects. The information below describesWe do not believe that there have been any material changes from the risk factors previously disclosed in our 20162022 Annual Report on Form 10-K and should be read in conjunction with the risk factors and information described therein.10-K.


The spin-off of our Cars.com business and sale of our majority ownership interest in CareerBuilder has reduced the size and diversification of our business, which in turn increases our exposure to the changes and highly competitive environment of the broadcast industry.

We now operate as a single business segment which is more exposed to the increased competition and changing regulatory environment within the broadcast industry. Broadcast companies operate in a highly competitive environment and compete for audiences, advertising & marketing services revenue and quality programing. Lower audience share, declines in advertising & marketing services revenue and increased programming costs would adversely affect our business, financial condition and results of operations.

In addition, the Federal Communications Commission (FCC) and Congress are contemplating several new laws and changes to existing media ownership and other broadcast-related regulations, regarding a wide range of matters (including permitting companies to own more stations in a single market, as well as owning more stations nationwide). Changes to FCC rules may lead to additional opportunities and increased uncertainty in the industry. We cannot be assured that we will be able to compete successfully in the future against existing, new or potential competitors, or that competition and consolidation in the media marketplace will not have a material adverse effect on our business, financial condition or results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds


On September 19, 2017, we announced thatIn December 2020, our Board of Directors authorized a newthe renewal of our share repurchase program for up to $300.0 million of our common stock over the next three years. During the third quarter of 2017, noNo shares were repurchased.repurchased during the three months ended March 31, 2023. As a result of the announcement of the Merger Agreement on February 22, 2022, we have suspended share repurchases under this program.


Item 3. Defaults Upon Senior Securities


None.


Item 4. Mine Safety Disclosures

None.


Item 5. Other Information

None.

28


Item 6. Exhibits
Exhibit NumberDescriptionLocation
3-1Third
3-1
Incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s Form 10-Q for the fiscal quarter ended April 1, 2007.
3-1-1Amendment to Third Restated Certificate of Incorporation of TEGNA Inc.
Incorporated (incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s Form 8-K filed on May 1, 2015.12, 2021).
3-1-23-2Amendment to Third Restated Certificate of Incorporation of TEGNA Inc.
3-2By-laws, as amended through December 8, 2015.
IncorporatedMay 12, 2021 (incorporated by reference to Exhibit 3-2 to TEGNA Inc.’s Form 8-K filed on December 11, 2015.May 12, 2021).
10-1Tenth Amendment, dated as of August 1, 2017, to the Amended and Restated Competitive Advance and Revolving Credit Agreement, dated as of December 13, 2004 and effective as of January 5, 2005, as amended and restated as of August 5, 2013, and as further amended, among TEGNA Inc., JPMorgan Chase Bank, N.A., as administrative agent, and the several banks and other financial institutions from time to time parties thereto.
31-110-2
10-3
10-4
31-1
Attached.
31-2
Attached.
32-1
Attached.
32-2
Attached.
101101.INS
The following financial information from TEGNA Inc. Quarterly Report on Form 10-Q forInline XBRL Instance Document - the quarter ended September 30, 2017, formattedinstance document does not appear in the Interactive Data File because its XBRL includes: (i) Condensed Consolidated Balance Sheets at September 30, 2017tags are embedded within the Inline XBRL document.
101.SCHInline XBRL Taxonomy Extension Schema Document.
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEFInline XBRL Taxonomy Extension Definition Document.
101.LABInline XBRL Taxonomy Extension Label Linkbase Document.
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document.
104Cover Page Interactive Data File (formatted as Inline XBRL and December 31, 2016, (ii) Consolidated Statements of Income for the quarter and year-to-date periods ended September 30, 2017 and September 30, 2016, (iii) Consolidated Statements of Comprehensive Income for the quarter and year-to-date periods ended September 30, 2017 and September 30, 2016, (iv) Condensed Consolidated Cash Flow Statements for the year-to-date periods ended September 30, 2017 and September 30, 2016, and (v) the notes to unaudited condensed consolidated financial statements.

contained in Exhibit 101).
Attached.


We agree to furnish to the Commission, upon request, a copy of each agreement with respect to long-term debt not filed herewith in reliance upon the exemption from filing applicable to any series of debt representing less than 10% of our total consolidated assets.

* Asterisks identify management contracts and compensatory plans and arrangements.

29

SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: May 10, 2023TEGNA INC.
Date: November 8, 2017TEGNA INC.
/s/ Clifton A. McClelland III
Clifton A. McClelland III
Senior Vice President and Controller
(on behalf of Registrant and as ChiefPrincipal Accounting Officer)



36
30