Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2023 | May 01, 2023 | |
Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-36097 | |
Entity Registrant Name | GANNETT CO., INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 38-3910250 | |
Entity Address, Address Line One | 7950 Jones Branch Drive, | |
Entity Address, City or Town | McLean, | |
Entity Address, State or Province | VA | |
Entity Address, Postal Zip Code | 22107-0910 | |
City Area Code | 703 | |
Local Phone Number | 854-6000 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock Shares Outstanding | 149,006,837 | |
Entity Central Index Key | 0001579684 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Common stock | ||
Entity Information | ||
Title of Each Class | Common Stock, par value $0.01 per share | |
Trading Symbol | GCI | |
Name of Each Exchange on Which Registered | NYSE | |
Preferred Stock Purchase Rights | ||
Entity Information | ||
Title of Each Class | Preferred Stock Purchase Rights | |
Name of Each Exchange on Which Registered | NYSE | |
No Trading Symbol | true |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 83,074 | $ 94,255 |
Accounts receivable, net of allowance of $14,499 and $16,697 as of March 31, 2023 and December 31, 2022, respectively | 256,465 | 289,415 |
Inventories | 41,882 | 45,223 |
Prepaid expenses | 48,038 | 46,205 |
Other current assets | 21,399 | 32,679 |
Total current assets | 450,858 | 507,777 |
Property, plant and equipment, net of accumulated depreciation of $379,524 and $360,522 as of March 31, 2023 and December 31, 2022, respectively | 291,785 | 305,994 |
Operating lease assets | 231,957 | 233,322 |
Goodwill | 533,469 | 533,166 |
Intangible assets, net | 591,688 | 613,358 |
Deferred tax assets | 73,122 | 56,618 |
Pension and other assets | 155,555 | 143,320 |
Total assets | 2,328,434 | 2,393,555 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 304,912 | 351,848 |
Deferred revenue | 141,716 | 153,648 |
Current portion of long-term debt | 60,452 | 60,452 |
Operating lease liabilities | 46,248 | 44,872 |
Other current liabilities | 6,229 | 6,218 |
Total current liabilities | 559,557 | 617,038 |
Long-term debt | 660,974 | 695,642 |
Convertible debt | 408,943 | 405,681 |
Deferred tax liabilities | 0 | 1,439 |
Pension and other postretirement benefit obligations | 49,161 | 50,710 |
Long-term operating lease liabilities | 215,499 | 219,109 |
Other long-term liabilities | 113,657 | 108,563 |
Total noncurrent liabilities | 1,448,234 | 1,481,144 |
Total liabilities | 2,007,791 | 2,098,182 |
Commitments and contingent liabilities (See Note 11) | ||
Equity | ||
Preferred stock, $0.01 par value per share, 300,000 shares authorized, of which 150,000 shares are designated as Series A Junior Participating Preferred Stock, none of which were issued and outstanding at March 31, 2023 and December 31, 2022 | 0 | 0 |
Common stock, $0.01 par value per share, 2,000,000,000 shares authorized, 157,980,877 shares issued and 149,221,069 shares outstanding at March 31, 2023; 153,286,104 shares issued and 146,223,179 shares outstanding at December 31, 2022 | 1,580 | 1,533 |
Treasury stock, at cost, 8,759,808 shares and 7,062,925 shares at March 31, 2023 and December 31, 2022, respectively | (16,883) | (14,737) |
Additional paid-in capital | 1,413,397 | 1,409,578 |
Accumulated deficit | (989,057) | (999,401) |
Accumulated other comprehensive loss | (87,941) | (101,231) |
Total Gannett stockholders' equity | 321,096 | 295,742 |
Noncontrolling interests | (453) | (369) |
Total equity | 320,643 | 295,373 |
Total liabilities and equity | $ 2,328,434 | $ 2,393,555 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Trade receivables, allowance for doubtful receivables | $ 14,499 | $ 16,697 |
Property plant and equipment, accumulated depreciation | $ 379,524 | $ 360,522 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock authorized (in shares) | 300,000 | 300,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock, issued (in shares) | 157,980,877 | 153,286,104 |
Common stock, outstanding (in shares) | 149,221,069 | 146,223,179 |
Treasury stock (in shares) | 8,759,808 | 7,062,925 |
Series A Junior Participating Preferred Stock | ||
Preferred stock authorized (in shares) | 150,000 | 150,000 |
Preferred stock, outstanding (in shares) | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Total operating revenues | $ 668,917 | $ 748,077 | |
Operating costs | 430,188 | 469,885 | |
Selling, general and administrative expenses | 180,390 | 221,837 | |
Depreciation and amortization | 43,698 | 47,783 | |
Integration and reorganization costs | 12,127 | 11,398 | |
Asset impairments | 5 | 854 | |
Gain on sale or disposal of assets, net | (17,681) | (2,804) | |
Other operating expenses | 229 | 1,102 | |
Total operating expenses | 648,956 | 750,055 | |
Operating income (loss) | 19,961 | (1,978) | |
Interest expense | 28,330 | 26,006 | |
(Gain) loss on early extinguishment of debt | (496) | 2,743 | |
Non-operating pension income | (1,815) | (18,213) | |
Other non-operating expense (income), net | 1,011 | (1,805) | |
Non-operating expenses | 27,030 | 8,731 | |
Loss before income taxes | (7,069) | (10,709) | |
Benefit for income taxes | (17,329) | (7,607) | |
Net income (loss) | 10,260 | (3,102) | |
Net loss attributable to noncontrolling interests | (84) | (135) | |
Net income (loss) attributable to Gannett | $ 10,344 | $ (2,967) | |
Income (loss) per share attributable to Gannett - basic (in dollars per share) | $ 0.07 | $ (0.02) | |
Income (loss) per share attributable to Gannett - diluted (in dollars per share) | $ 0.07 | $ (0.02) | |
Other comprehensive loss: | |||
Foreign currency translation adjustments | $ 6,337 | $ (7,556) | |
Pension and other postretirement benefit items: | |||
Net actuarial gain (loss) | 11,596 | (1,796) | |
Amortization of net actuarial gain (loss) | 4 | (32) | |
Amortization of prior service cost | 16 | 0 | |
Equity method investments | 610 | 0 | |
Other | (2,911) | 536 | |
Total pension and other postretirement benefit items | 9,315 | (1,292) | |
Other comprehensive income (loss) before tax | 15,652 | (8,848) | |
Income tax provision (benefit) related to components of other comprehensive income (loss) | 2,362 | (457) | |
Other comprehensive income (loss), net of tax | [1] | 13,290 | (8,391) |
Comprehensive income (loss) | 23,550 | (11,493) | |
Comprehensive loss attributable to noncontrolling interests | (84) | (135) | |
Comprehensive income (loss) attributable to Gannett | 23,634 | (11,358) | |
Advertising and marketing services | |||
Total operating revenues | 340,847 | 375,114 | |
Circulation | |||
Total operating revenues | 241,285 | 288,602 | |
Other | |||
Total operating revenues | $ 86,785 | $ 84,361 | |
[1]For the three months ended March 31, 2023 and 2022, Other comprehensive income (loss) is net of income tax provision of $2.4 million and income tax benefit of $0.5 million, respectively. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Operating activities | ||
Net income (loss) | $ 10,260 | $ (3,102) |
Adjustments to reconcile net income (loss) to operating cash flows: | ||
Depreciation and amortization | 43,698 | 47,783 |
Share-based compensation expense | 3,736 | 3,393 |
Non-cash interest expense | 5,267 | 5,316 |
Gain on sale or disposal of assets, net | (17,681) | (2,804) |
(Gain) loss on early extinguishment of debt | (496) | 2,743 |
Asset impairments | 5 | 854 |
Pension and other postretirement benefit obligations | (3,725) | (27,291) |
Change in other assets and liabilities, net | (34,346) | 5,537 |
Cash provided by operating activities | 6,718 | 32,429 |
Investing activities | ||
Acquisitions, net of cash acquired | 0 | (15,427) |
Purchase of property, plant and equipment | (8,798) | (10,764) |
Proceeds from sale of real estate and other assets | 29,502 | 20,471 |
Change in other investing activities | 0 | (500) |
Cash provided by (used for) investing activities | 20,704 | (6,220) |
Financing activities | ||
Payments of deferred financing costs | 0 | (423) |
Borrowings of long-term debt | 0 | 72,500 |
Repayments of long-term debt | (36,178) | (70,476) |
Acquisition of noncontrolling interests | 0 | (2,050) |
Treasury stock | (2,138) | (3,138) |
Changes in other financing activities | (324) | (231) |
Cash used for financing activities | (38,640) | (3,818) |
Effect of currency exchange rate change on cash | 38 | (992) |
Increase (decrease) in cash, cash equivalents and restricted cash | (11,180) | 21,399 |
Cash, cash equivalents and restricted cash at beginning of period | 104,804 | 143,619 |
Cash, cash equivalents and restricted cash at end of period | $ 93,624 | $ 165,018 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Common stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Accumulated deficit | Treasury stock | Non-controlling interest | |
Beginning balance (in shares) at Dec. 31, 2021 | 144,667,000 | |||||||
Beginning balance at Dec. 31, 2021 | $ 529,615 | $ 1,446 | $ 1,400,206 | $ 59,998 | $ (921,399) | $ (8,151) | $ (2,485) | |
Beginning balance (in shares) at Dec. 31, 2021 | 2,368,000 | |||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income (loss) attributable to Gannett | (3,102) | (2,967) | (135) | |||||
Acquisition of noncontrolling interests | (2,050) | (4,419) | 2,369 | |||||
Restricted stock awards settled, net of withholdings | (1,534) | $ 7 | (1,541) | |||||
Restricted stock awards settled, net of withholdings (in shares) | 615,000 | |||||||
Restricted share grants | 0 | $ 57 | (57) | |||||
Restricted share grants (in shares) | 5,728,000 | |||||||
Other comprehensive income (loss), net | [1] | (8,391) | (8,391) | |||||
Share-based compensation expense | 3,393 | 3,393 | ||||||
Issuance of common stock | 62 | 62 | ||||||
Issuance of common stock (in shares) | 7,000 | |||||||
Treasury stock | (3,138) | $ (3,138) | ||||||
Treasury stock (in shares) | 692,000 | |||||||
Restricted share forfeiture | (1) | $ (1) | ||||||
Restricted share forfeiture (in shares) | 128,000 | |||||||
Other activity | (128) | (128) | ||||||
Ending balance (in shares) at Mar. 31, 2022 | 151,017,000 | |||||||
Ending balance at Mar. 31, 2022 | $ 514,726 | $ 1,510 | 1,397,516 | 51,607 | (924,366) | $ (11,290) | (251) | |
Ending balance (in shares) at Mar. 31, 2022 | 3,188,000 | |||||||
Beginning balance (in shares) at Dec. 31, 2022 | 146,223,179 | 153,286,000 | ||||||
Beginning balance at Dec. 31, 2022 | $ 295,373 | $ 1,533 | 1,409,578 | (101,231) | (999,401) | $ (14,737) | (369) | |
Beginning balance (in shares) at Dec. 31, 2022 | 7,062,925 | 7,063,000 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income (loss) attributable to Gannett | $ 10,260 | 10,344 | (84) | |||||
Restricted share grants | 0 | $ 47 | (47) | |||||
Restricted share grants (in shares) | 4,682,000 | |||||||
Other comprehensive income (loss), net | [1] | 13,290 | 13,290 | |||||
Share-based compensation expense | 3,736 | 3,736 | ||||||
Issuance of common stock | 25 | 25 | ||||||
Issuance of common stock (in shares) | 13,000 | |||||||
Treasury stock | (2,139) | $ (2,139) | ||||||
Treasury stock (in shares) | 957,000 | |||||||
Restricted share forfeiture | (7) | $ (7) | ||||||
Restricted share forfeiture (in shares) | 740,000 | |||||||
Other activity | $ 105 | 105 | ||||||
Ending balance (in shares) at Mar. 31, 2023 | 149,221,069 | 157,981,000 | ||||||
Ending balance at Mar. 31, 2023 | $ 320,643 | $ 1,580 | $ 1,413,397 | $ (87,941) | $ (989,057) | $ (16,883) | $ (453) | |
Ending balance (in shares) at Mar. 31, 2023 | 8,759,808 | 8,760,000 | ||||||
[1]For the three months ended March 31, 2023 and 2022, Other comprehensive income (loss) is net of income tax provision of $2.4 million and income tax benefit of $0.5 million, respectively. |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||
Other comprehensive loss, tax provision (benefit) | $ 2,362 | $ (457) |
Description of business and bas
Description of business and basis of presentation | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Description of business and basis of presentation | NOTE 1 — Description of business and basis of presentation Description of business Gannett Co., Inc. ("Gannett", "we", "us", "our", or the "Company") is a subscription-led and digitally-focused media and marketing solutions company committed to empowering communities to thrive. Gannett operates a scalable, data-driven media platform that aligns with consumer and digital marketing trends. We aim to be the premier source for clarity, connections and solutions within our communities. Our mission is to provide unbiased, unique local and national content and unrivaled marketing solutions to the communities we serve. We seek to drive audience growth and engagement by delivering valuable content experiences to our consumers, while offering the unique products and marketing expertise our advertisers desire. Our strategy prioritizes the growth of highly recurring digital businesses, while maximizing the lifetime value of our legacy print business, and we expect the execution of this strategy to enable us to continue our evolution to a digitally-focused content platform. Our current portfolio of media assets includes the USA TODAY NETWORK, which includes USA TODAY and local media organizations in 43 states in the United States (the "U.S."), and Newsquest, a wholly-owned subsidiary operating in the United Kingdom (the "U.K."). We also own digital marketing services companies under the brand LocaliQ, which provide a cloud-based platform of products to enable small and medium-sized businesses to accomplish their marketing goals. In addition, our portfolio includes what we believe is the largest media-owned events business in the U.S., USA TODAY NETWORK Ventures. Through USA TODAY, our network of local properties, and Newsquest, we deliver high-quality, trusted content with a commitment to balanced, unbiased journalism, where and when consumers want to engage with it on virtually any device or platform. Additionally, the Company has strong relationships with hundreds of thousands of local and national businesses in both our U.S. and U.K. markets due to our large local and national sales forces and a robust advertising and marketing solutions product suite. The Company reports in two segments, Gannett Media and Digital Marketing Solutions ("DMS"). We also have a Corporate and other category that includes activities not directly attributable to a specific reportable segment and includes broad corporate functions such as legal, human resources, accounting, analytics, finance and marketing, as well as other general business costs. A full description of our reportable segments is included in Note 12 — Segment reporting in the notes to the condensed consolidated financial statements. Basis of presentation The unaudited condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. As permitted under those rules, certain notes or other financial information that are normally required by U.S. GAAP have been condensed or omitted from these interim financial statements. The unaudited condensed consolidated financial statements should therefore be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. In the opinion of management, the unaudited condensed consolidated financial statements as of March 31, 2023 include all the assets, liabilities, revenues, expenses and cash flows of entities which Gannett controls due to ownership of a majority voting interest ("subsidiaries"). All significant intercompany accounts and transactions have been eliminated in consolidation, and the Company consolidates its subsidiaries. Use of estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and footnotes thereto. Actual results could differ materially from those estimates. Significant estimates inherent in the preparation of the unaudited condensed consolidated financial statements include pension and postretirement benefit obligation assumptions, income taxes, and goodwill and intangible asset impairment analysis. |
Revenues
Revenues | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | NOTE 2 — Revenues Revenues are recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company's condensed consolidated statements of operations and comprehensive income (loss) present revenues disaggregated by revenue type. Sales taxes and other usage-based taxes are excluded from revenues. The following table presents our revenues disaggregated by source: Three months ended March 31, In thousands 2023 2022 Print advertising $ 147,954 $ 173,518 Digital advertising and marketing services 192,893 201,596 Total advertising and marketing services 340,847 375,114 Circulation 241,285 288,602 Other 86,785 84,361 Total revenues $ 668,917 $ 748,077 For the three months ended March 31, 2023 and 2022, revenues generated from international locations were approximately 10.2% and 8.9% of total revenues, respectively. Deferred revenues The Company records deferred revenues when cash payments are received in advance of the Company's performance obligation. The Company's primary source of deferred revenues is from circulation subscriptions paid in advance of the service provided, which represents future delivery of publications (the performance obligation) to subscription customers. The Company expects to recognize the revenue related to unsatisfied performance obligations over the next one The Company's payment terms vary by the type and location of the customer and the products or services offered. The period between invoicing and when payment is due is not significant. For certain products or services and customer types, the Company requires payment before the products or services are delivered to the customer. The majority of our subscription customers are billed and pay on monthly terms. The following table presents the change in the deferred revenues balance by type of revenues: Three months ended March 31, 2023 Three months ended March 31, 2022 In thousands Advertising, marketing services, and other Circulation Total Advertising, marketing services, and other Circulation Total Beginning balance $ 46,327 $ 107,321 $ 153,648 $ 60,665 $ 124,173 $ 184,838 Acquisition — — — — 2,388 2,388 Cash receipts, net of refunds 65,632 207,486 273,118 76,125 237,860 313,985 Revenue recognized (72,663) (212,387) (285,050) (75,463) (240,169) (315,632) Ending balance $ 39,296 $ 102,420 $ 141,716 $ 61,327 $ 124,252 $ 185,579 |
Accounts receivable, net
Accounts receivable, net | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
Accounts receivable, net | NOTE 3 — Accounts receivable, net Receivables are presented net of allowances, which reflect the Company's expected credit losses based on historical experience as well as current and expected economic conditions. The following table presents changes in the allowance for doubtful accounts: Three months ended March 31, In thousands 2023 2022 Beginning balance $ 16,697 $ 16,470 Current period provision 1,383 (2,403) Write-offs charged against the allowance (4,839) (3,868) Recoveries of amounts previously written-off 1,199 942 Other 59 425 Ending balance $ 14,499 $ 11,566 |
Goodwill and intangible assets
Goodwill and intangible assets | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | NOTE 4 — Goodwill and intangible assets Goodwill and intangible assets consisted of the following: March 31, 2023 December 31, 2022 In thousands Gross carrying amount Accumulated Net carrying Gross carrying amount Accumulated Net carrying Finite-lived intangible assets: Advertiser relationships $ 446,162 $ 202,973 $ 243,189 $ 445,775 $ 192,032 $ 253,743 Other customer relationships 102,259 48,535 53,724 102,224 45,811 56,413 Subscriber relationships 251,090 133,959 117,131 251,083 126,899 124,184 Other intangible assets 68,780 57,614 11,166 68,780 55,932 12,848 Sub-total $ 868,291 $ 443,081 $ 425,210 $ 867,862 $ 420,674 $ 447,188 Indefinite-lived intangible assets: Mastheads 166,478 166,170 Total intangible assets $ 591,688 $ 613,358 Goodwill $ 533,469 $ 533,166 The Company performs its annual goodwill and indefinite-lived intangible impairment assessments as of November 30. In addition to the annual impairment test, the Company is required to regularly assess whether a triggering event has occurred under both ASC 350 "Intangibles - Goodwill and Other" ("ASC 350"), and ASC 360 "Property, Plant and Equipment" ("ASC 360"), which would require interim impairment testing. As of March 31, 2023, the Company performed a review of potential impairment indicators under both ASC 350 and ASC 360 and it was determined that no indicators of impairment were present. |
Integration and reorganization
Integration and reorganization costs | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Integration and reorganization costs | NOTE 5 — Integration and reorganization costs Over the past several years, the Company has engaged in a series of individual restructuring programs, designed primarily to right-size the Company's employee base, consolidate facilities and improve operations, including those of acquired entities. These initiatives impact all the Company's operations and can be influenced by the terms of union contracts. Costs related to these programs, which primarily include severance, facility consolidation and other restructuring-related expenses, are accrued when probable and reasonably estimable or at the time of program announcement. Severance-related expenses The Company recorded severance-related expenses by segment as follows: Three months ended March 31, In thousands 2023 2022 Gannett Media $ 6,112 $ 5,177 Digital Marketing Solutions 20 9 Corporate and other 4,121 174 Total $ 10,253 $ 5,360 A roll-forward of the accrued severance and related expenses included in Accounts payable and accrued liabilities on the condensed consolidated balance sheets for the three months ended March 31, 2023 is as follows: In thousands Severance and Beginning balance $ 29,773 Restructuring provision included in integration and reorganization costs 10,253 Cash payments (18,178) Ending balance $ 21,848 Other restructuring-related expenses Other restructuring-related expenses represent costs for consolidating operations, systems implementation, outsourcing of corporate functions and facility consolidations. The Company recorded other restructuring-related costs by segment as follows: Three months ended March 31, In thousands 2023 2022 Gannett Media (a) $ (1,463) $ 544 Digital Marketing Solutions — 142 Corporate and other 3,337 5,352 Total $ 1,874 $ 6,038 (a) For the three months ended March 31, 2023, other restructuring-related costs decreased compared to the three months ended March 31, 2022, primarily due to the reversal of a withdrawal liability related to a multiemployer pension plan. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 6 — Debt The Company's debt consisted of the following: March 31, 2023 December 31, 2022 (In millions) Principal balance Unamortized original issue discount Unamortized deferred financing costs Carrying value Principal balance Unamortized original issue discount Unamortized deferred financing costs Carrying value Senior Secured Term Loan $ 407.1 $ (7.8) $ (1.7) $ 397.6 $ 438.4 $ (8.9) $ (1.9) $ 427.6 2026 Senior Notes 339.1 (8.6) (6.7) 323.8 345.2 (9.4) (7.3) 328.5 2027 Notes 485.3 (78.0) (1.7) 405.6 485.3 (81.2) (1.7) 402.4 2024 Notes 3.3 — — 3.3 3.3 — — 3.3 Total debt $ 1,234.8 $ (94.4) $ (10.1) $ 1,130.3 $ 1,272.2 $ (99.5) $ (10.9) $ 1,161.8 Less: Current portion of long-term debt $ (60.5) $ — $ — $ (60.5) $ (60.5) $ — $ — $ (60.5) Non-current portion of long-term debt $ 1,174.3 $ (94.4) $ (10.1) $ 1,069.8 $ 1,211.7 $ (99.5) $ (10.9) $ 1,101.3 Senior Secured Term Loan On October 15, 2021, Gannett Holdings LLC ("Gannett Holdings"), a wholly-owned subsidiary of the Company, entered into the five-year senior secured term loan facility in an original aggregate principal amount of $516.0 million (the "Senior Secured Term Loan," formerly referred to as the New Senior Secured Term Loan) with Citibank N.A., as collateral agent and administrative agent for the lenders. On January 31, 2022, Gannett Holdings entered into an amendment (the "Term Loan Amendment") to the Senior Secured Term Loan to provide for new incremental senior secured term loans (the "Incremental Term Loans") in an aggregate principal amount of $50 million. The Incremental Term Loans have substantially identical terms as the Senior Secured Term Loan and are treated as a single tranche with the Senior Secured Term Loan. The Term Loan Amendment also amended the Senior Secured Term Loan to transition the interest rate base from the London Inter-bank Offered Rate ("LIBOR") to the Adjusted Term Secured Overnight Financing Rate ("Adjusted Term SOFR"). Effective as of March 21, 2022 and April 8, 2022, Gannett Holdings entered into two separate amendments to the Senior Secured Term Loan to provide for incremental senior secured term loans totaling an aggregate principal amount of $30.0 million (collectively, the "Exchanged Term Loans"). The Exchanged Term Loans have substantially identical terms as the Senior Secured Term Loan and Incremental Term Loans and are treated as a single tranche with the Senior Secured Term Loan and the Incremental Term Loans. The Senior Secured Term Loan bears interest at a per annum rate equal to the Adjusted Term SOFR (which shall not be less than 0.50% per annum) plus a margin equal to 5.00% or an alternate base rate (which shall not be less than 1.50% per annum) plus a margin equal to 4.00%. Loans under the Senior Secured Term Loan may be prepaid, at the option of Gannett Holdings, at any time without premium. In addition, we are required to repay the Senior Secured Term Loan from time to time with (i) the proceeds of non-ordinary course asset sales and casualty and condemnation events, (ii) the proceeds of indebtedness not permitted under the Senior Secured Term Loan, and (iii) the aggregate amount of cash and cash equivalents on hand at the Company and its restricted subsidiaries in excess of $100 million at the end of each fiscal year of the Company. Subsequent to the amendment effective as of April 8, 2022, the Senior Secured Term Loan is amortized at $15.1 million per quarter (or, if the ratio of debt secured on an equal basis with the Senior Secured Term Loan less unrestricted cash of the Company and its restricted subsidiaries to Consolidated EBITDA (as such terms are defined in the Senior Secured Term Loan ) (such ratio, the "First Lien Net Leverage Ratio"), for the most recently ended period of four consecutive fiscal quarters is equal to or less than 1.20 to 1.00, $7.6 million per quarter). All obligations under the Senior Secured Term Loan are secured by all or substantially all of the assets of the Company and the wholly-owned domestic subsidiaries of the Company (the "Senior Secured Term Loan Guarantors"). The obligations of Gannett Holdings under the Senior Secured Term Loan are guaranteed on a senior secured basis by the Company and the Senior Secured Term Loan Guarantors. The Senior Secured Term Loan contains usual and customary covenants for credit facilities of this type, including a requirement to have minimum unrestricted cash of $30 million as of the last day of each fiscal quarter, and restricts, among other things, our ability to incur debt, grant liens, sell assets, make investments and pay dividends, in each case with customary exceptions, including an exception that permits dividends and repurchases of outstanding junior debt or equity in (i) an amount of up to $25 million per fiscal quarter if the First Lien Net Leverage Ratio for such fiscal quarter is equal to or less than 2.00 to 1.00, (ii) an amount of up to $50 million per fiscal quarter if the First Lien Net Leverage Ratio for such fiscal quarter is equal to or less than 1.50 to 1.00, and (iii) an unlimited amount if First Lien Net Leverage Ratio for such fiscal quarter is equal to or less than 1.00 to 1.00. As of March 31, 2023, the Company was in compliance with all of the covenants and obligations under the Senior Secured Term Loan. As of March 31, 2023 and December 31, 2022, the Senior Secured Term Loan was recorded at carrying value, which approximated fair value, in the condensed consolidated balance sheets and was classified as Level 2. For the three months ended March 31, 2023, the Company recognized interest expense of $10.3 million and paid cash interest of $10.4 million. For the three months ended March 31, 2022, the Company recognized interest expense of $6.9 million and paid cash interest of $6.9 million. For the three months ended March 31, 2023, the Company recognized amortization of original issue discount of $0.8 million, and amortization of deferred financing costs of $0.1 million. For the three months ended March 31, 2022, the Company recognized amortization of original issue discount of $0.9 million, and amortization of deferred financing costs of $0.2 million. Additionally, during the three months ended March 31, 2023, the Company recognized losses on early extinguishment of debt of $0.4 million, and for the three months ended March 31, 2022, the Company recognized losses on early extinguishment of debt of $1.4 million related to the write-off of original issue discount and deferred financing costs as a result of early prepayments on the Senior Secured Term Loan. For the three months ended March 31, 2023, the Company made $31.3 million of prepayments, including quarterly amortization payments, which were classified as financing activities in the condensed consolidated statements of cash flows. As of March 31, 2023, the effective interest rate for the Senior Secured Term Loan was 10.6%. Senior Secured Notes due 2026 On October 15, 2021, Gannett Holdings completed a private offering of $400 million aggregate principal amount of 6.00% first lien notes due November 1, 2026 (the "2026 Senior Notes"). The 2026 Senior Notes were issued pursuant to an indenture, dated October 15, 2021 (the "2026 Senior Notes Indenture") among Gannett Holdings, the Company, the guarantors from time to time party thereto (the "2026 Senior Notes Guarantors"), U.S. Bank National Association, as trustee, and U.S. Bank National Association, as collateral agent, registrar, paying agent and authenticating agent. For the year ended December 31, 2022, the Company repurchased $54.8 million in aggregate principal amount of outstanding 2026 Senior Notes pursuant to privately negotiated agreements with certain holders of the 2026 Senior Notes. As part of these repurchases, we exchanged an aggregate principal amount equal to $30.0 million of the 2026 Senior Notes for $30.0 million of new term loans under the Senior Secured Term Loan. The repurchases were treated as an extinguishment of a portion of the 2026 Senior Notes, and as a result, for the year ended December 31, 2022, the Company recognized a net gain on the early extinguishment of debt of approximately $2.6 million, which included write-offs of unamortized original issue discount and deferred financing costs. For the three months ended March 31, 2023, the Company repurchased $6.1 million in aggregate principal amount of outstanding 2026 Senior Notes at a discount to par value pursuant to a privately negotiated agreement with a holder of the 2026 Senior Notes. As a result of this transaction, for the three months ended March 31, 2023, the Company recognized a net gain on the early extinguishment of debt of approximately $0.9 million, which included the write-off of unamortized original issue discount and deferred financing costs. Interest on the 2026 Senior Notes is payable semi-annually in arrears, beginning on May 1, 2022. The 2026 Senior Notes mature on November 1, 2026, unless redeemed or repurchased earlier pursuant to the 2026 Senior Notes Indenture. The 2026 Senior Notes may be redeemed at the option of Gannett Holdings, in whole or in part, at any time and from time to time after November 1, 2023, at the redemption prices set forth in the 2026 Senior Notes Indenture. At any time prior to such date, Gannett Holdings will be entitled at its option to redeem all, but not less than all, of the 2026 Senior Notes at the "make-whole" redemption price set forth in the 2026 Senior Notes Indenture. Additionally, at any time prior to November 1, 2023, Gannett Holdings may, on one or more occasions, redeem up to 40% of the aggregate principal amount of the 2026 Senior Notes at the redemption price set forth in the 2026 Senior Notes Indenture with the net cash proceeds of certain equity offerings. If certain changes of control with respect to Gannett Holdings or the Company occur, Gannett Holdings must offer to purchase the 2026 Senior Notes at a purchase price in cash equal to 101% of the principal amount thereof on the date of purchase, plus accrued and unpaid interest to, but excluding, the date of purchase. In addition, during any twelve-month period commencing on or after October 15, 2021 and ending prior to November 1, 2023, up to 10% of the aggregate principal amount of the 2026 Senior Notes issued under the 2026 Senior Notes Indenture may be redeemed at a purchase price equal to 103% of the aggregate principal amount of the 2026 Senior Notes to be redeemed, plus accrued and unpaid interest, if any, to but excluding, the redemption date. The 2026 Senior Notes are unconditionally guaranteed, jointly and severally, on a senior secured basis by the 2026 Senior Notes Guarantors. The 2026 Senior Notes and such guarantees are secured on a first-priority basis by the collateral, consisting of substantially all of the assets of Gannett Holdings and the 2026 Senior Notes Guarantors, subject to certain intercreditor arrangements. The 2026 Senior Notes Indenture limits the Company and its restricted subsidiaries' ability to, among other things, make investments, loans, advances, guarantees and acquisitions; incur or guarantee additional debt and issue certain disqualified equity interests and preferred stock; make certain restricted payments, including a limit on dividends on equity securities or payments to redeem, repurchase or retire equity securities or other indebtedness; dispose of assets; create liens on assets to secure debt; engage in transactions with affiliates; enter into certain restrictive agreements; and consolidate, merge, sell or otherwise dispose of all or substantially all of their or the 2026 Senior Notes Guarantor's assets. These covenants are subject to a number of limitations and exceptions. The 2026 Senior Notes Indenture also contains customary events of default. As of March 31, 2023 and December 31, 2022, the 2026 Senior Notes were recorded at carrying value in the condensed consolidated balance sheets, which did not approximate fair value. The 2026 Senior Notes were classified as Level 2, and based on unadjusted quoted prices in the active market obtained from third-party pricing services, the Company determined that the estimated fair value of the 2026 Senior Notes was $284.4 million and $281.7 million as of March 31, 2023 and December 31, 2022, respectively, and was primarily affected by fluctuations in market interest rates. The unamortized original issue discount and deferred financing costs will be amortized over the remaining contractual life of the 2026 Senior Notes using the effective interest method. For the three months ended March 31, 2023, the Company recognized interest expense of $5.0 million, and paid cash interest of $0.1 million. For the three months ended March 31, 2022, the Company recognized interest expense of $6.0 million, and paid cash interest of $0.6 million. For the three months ended March 31, 2023, the Company recognized amortization of original issue discount of $0.6 million and amortization of deferred financing costs of $0.5 million. For the three months ended March 31, 2022, the Company recognized amortization of original discount of $0.7 million and amortization of deferred financing costs of $0.6 million. As of March 31, 2023, the effective interest rate on the 2026 Senior Notes was 7.3%. Senior Secured Convertible Notes due 2027 The $497.1 million in aggregate principal amount of 6.0% Senior Secured Convertible Notes due 2027 (the "2027 Notes") were issued pursuant to an Indenture dated as of November 17, 2020, as amended by the First Supplemental Indenture dated as of December 21, 2020 and the Second Supplemental Indenture dated as of February 9, 2021 (collectively, the "2027 Notes Indenture"), between the Company and U.S. Bank National Association, as trustee. In connection with the issuance of the 2027 Notes, the Company entered into an Investor Agreement (the "Investor Agreement") with the holders of the 2027 Notes (the "Holders") establishing certain terms and conditions concerning the rights and restrictions on the Holders with respect to the Holders' ownership of the 2027 Notes. The Company also entered into an amendment to the Registration Rights Agreement dated November 19, 2019, between the Company and FIG LLC. Interest on the 2027 Notes is payable semi-annually in arrears. The 2027 Notes mature on December 1, 2027, unless earlier repurchased or converted. The 2027 Notes may be converted at any time by the holders into cash, shares of the Company's common stock, par value $0.01 per share (the "Common Stock") or any combination of cash and Common Stock, at the Company's election. The initial conversion rate is 200 shares of Common Stock per $1,000 principal amount of the 2027 Notes, which is equal to a conversion price of $5.00 per share of Common Stock (the "Conversion Price"). The conversion rate is subject to customary adjustment provisions as provided in the 2027 Notes Indenture. In addition, the conversion rate will be subject to adjustment in the event of any issuance or sale of Common Stock (or securities convertible into Common Stock) at a price equal to or less than the Conversion Price in order to ensure that following such issuance or sale, the 2027 Notes would be convertible into approximately 42% (adjusted for repurchases and certain other events that reduce the outstanding amount of the 2027 Notes) of the Common Stock after giving effect to such issuance or sale (assuming the initial principal amount of the 2027 Notes remains outstanding). After giving effect to the repurchase of $11.8 million in aggregate principal amount of outstanding 2027 Notes during the year ended December 31, 2021, such percentage is approximately 41%. Upon the occurrence of a "Make-Whole Fundamental Change" (as defined in the 2027 Notes Indenture), the Company will in certain circumstances increase the conversion rate for a specified period of time. If a "Fundamental Change" (as defined in the 2027 Notes Indenture) occurs, the Company will be required to offer to repurchase the 2027 Notes at a repurchase price of 110% of the principal amount thereof. Holders of the 2027 Notes will have the right to put up to approximately $100 million of the 2027 Notes at par on or after the date that is 91 days after the maturity date of the Senior Secured Term Loan. Under the 2027 Notes Indenture, the Company can only pay cash dividends up to an agreed-upon amount, provided the ratio of consolidated debt to EBITDA (as such terms are defined in the 2027 Notes Indenture) does not exceed a specified ratio. In addition, the 2027 Notes Indenture provides that, at any time that the Company's Total Gross Leverage Ratio (as defined in the 2027 Notes Indenture) exceeds 1.5 and the Company approves the declaration of a dividend, the Company must offer to purchase a principal amount of 2027 Notes equal to the proposed amount of the dividend. Until the four-year anniversary of the issuance date, the Company will have the right to redeem for cash up to approximately $99.4 million of the 2027 Notes at a redemption price of 130% of the principal amount thereof, with such amount reduced ratably by any principal amount of 2027 Notes that has been converted by the holders or redeemed or purchased by the Company. The 2027 Notes are guaranteed by Gannett Holdings and any subsidiaries of the Company that guarantee the Senior Secured Term Loan. The 2027 Notes are secured by the same collateral that secures the Senior Secured Term Loan. The 2027 Notes rank as senior secured debt of the Company and are secured by a second priority lien on the same collateral package that secured the indebtedness incurred in connection with the Senior Secured Term Loan. The 2027 Notes Indenture includes affirmative and negative covenants, including limitations on liens, indebtedness, dispositions, loan, advances and investors, sale and leaseback transactions, restricted payments, transactions with affiliates, restrictions on dividends and other payment restrictions affecting restricted subsidiaries, negative pledges and modifications to certain agreements. The 2027 Notes Indenture also requires that the Company maintain, as of the last day of each fiscal quarter, at least $30.0 million of Qualified Cash (as defined in the 2027 Notes Indenture). The 2027 Notes Indenture includes customary events of default. The 2027 Notes have two components: (i) a debt component, and (ii) an equity component. As of March 31, 2023 and December 31, 2022, the debt component of the 2027 Notes was recorded at carrying value in the condensed consolidated balance sheets. The carrying value of the 2027 Notes reflected the balance of the unamortized discount related to the value of the conversion feature assessed at inception and did not approximate fair value as of March 31, 2023 and December 31, 2022. The 2027 Notes were classified as Level 2, and based on unadjusted quoted prices in the active market obtained from third-party pricing services, the Company determined that the estimated fair value of the 2027 Notes was $354.3 million and $353.7 million as of March 31, 2023 and December 31, 2022, respectively, and was primarily affected by fluctuations in market interest rates and the price of the Company's Common Stock. The fair value of the equity component was classified as Level 3 because it was measured at fair value using a binomial lattice model using assumptions based on market information and historical data, and significant unobservable inputs. As of March 31, 2023 and December 31, 2022, the amount of the conversion feature recorded in Additional paid-in capital was $279.6 million. For the three months ended March 31, 2023 and 2022, the Company recognized interest expense of $7.2 million and $7.2 million, respectively. In addition, during the three months ended March 31, 2023, the Company recognized amortization of the original issue discount of $3.2 million and an immaterial amount of amortization of deferred financing costs. For the three months ended March 31, 2022, the Company recognized amortization of original issue discount of $2.9 million and amortization of deferred financing costs of $0.1 million. As of March 31, 2023, the effective interest rate on the liability component of the 2027 Notes was 10.5%. For the three months ended March 31, 2023, no shares were issued upon conversion, exercise, or satisfaction of the required conditions. Refer to Note 10 — Supplemental equity information for details on the impact of the 2027 Notes to diluted earnings per share under the if-converted method. Senior Convertible Notes due 2024 |
Pensions and other postretireme
Pensions and other postretirement benefit plans | 3 Months Ended |
Mar. 31, 2023 | |
Retirement Benefits [Abstract] | |
Pensions and other postretirement benefit plans | NOTE 7 — Pensions and other postretirement benefit plans We, along with our subsidiaries, sponsor various defined benefit retirement plans, including plans established under collective bargaining agreements. Our retirement plans include the Gannett Retirement Plan (the "GR Plan"), the Newsquest and Romanes Pension Schemes in the U.K., and other defined benefit and defined contribution plans. We also provide health care and life insurance benefits to certain retired employees who meet age and service requirements. Retirement plan costs include the following components: Pension benefits Postretirement benefits Three months ended March 31, Three months ended March 31, In thousands 2023 2022 2023 2022 Operating expenses: Service cost - benefits earned during the period $ 324 $ 475 $ 10 $ 15 Non-operating expenses: Interest cost on benefit obligations 21,201 18,649 632 451 Expected return on plan assets (23,668) (37,281) — — Amortization of prior service benefit 16 — — — Amortization of actuarial loss (gain) 540 20 (536) (52) Total non-operating (benefit) expense $ (1,911) $ (18,612) $ 96 $ 399 Total (benefit) expense for retirement plans $ (1,587) $ (18,137) $ 106 $ 414 Contributions We are contractually obligated to contribute to our pension and postretirement benefit plans. During the three months ended March 31, 2023, we contributed $0.3 million and $1.9 million to our pension and other postretirement plans, respectively. Beginning with the quarter ended December 31, 2022, and ending with the quarter ending September 30, 2024, the GR Plan's appointed actuary will certify the GR Plan's funded status for each quarter (the "Quarterly Certification") in accordance with U.S. GAAP. If the GR Plan is less than 100% funded, the Company will make a $1.0 million contribution to the GR Plan no later than 60 days following the receipt of the Quarterly Certification, provided, however, that the Company's obligation to make additional contractual contributions will terminate the earlier of (a) the day following the date that a contractual contribution would be due for the quarter ending September 30, 2024, and (b) the date the Company has made a total of $5.0 million of contractual contributions subsequent to June 30, 2022. As of March 31, 2023, the |
Fair value measurement
Fair value measurement | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair value measurement | NOTE 8 — Fair value measurement In accordance with ASC 820, "Fair Value Measurement," fair value measurements are required to be disclosed using a three-tiered fair value hierarchy which distinguishes between assumptions based on market data (observable inputs) and the Company's own assumptions (unobservable inputs). Level 1 refers to fair values determined based on quoted prices in active markets for identical assets or liabilities, Level 2 refers to fair values estimated using significant other observable inputs and Level 3 includes fair values estimated using significant unobservable inputs. As of March 31, 2023 and December 31, 2022, assets and liabilities recorded at fair value and measured on a recurring basis primarily consist of pension plan assets. As permitted by U.S. GAAP, we use net asset values ("NAV") as a practical expedient to determine the fair value of certain investments. These investments measured at NAV have not been classified in the fair value hierarchy. The Company's debt is recorded on the condensed consolidated balance sheets at carrying value. Refer to Note 6 — Debt for additional discussion regarding fair value of the Company's debt instruments. Certain assets are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). Assets held for sale (Level 3) are measured on a nonrecurring basis and are evaluated using executed purchase agreements, letters of intent or third-party valuation analyses when certain circumstances arise. The Company had assets held for sale totaling $2.3 million and $8.4 million as of March 31, 2023 and December 31, 2022, respectively. The Company performs its annual goodwill and indefinite-lived intangible impairment assessment during the fourth quarter of the year. Any resulting asset impairment would require that the asset be recorded at its fair value. The resulting fair value measurements of the assets are considered to be Level 3 measurements. Refer to Note 4 — Goodwill and intangible assets for additional discussion regarding the annual impairment assessment. |
Income taxes
Income taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income taxes | NOTE 9 — Income taxes The following table outlines our pre-tax net loss and income tax amounts: Three months ended March 31, In thousands 2023 2022 Loss before income taxes $ (7,069) $ (10,709) Benefit for income taxes (17,329) (7,607) Effective tax rate 245.1 % 71.0 % The provision for income taxes is calculated by applying the projected annual effective tax rate for the year to the current period income or loss before tax plus the tax effect of any significant or unusual items (discrete events), and changes in tax laws. The benefit for income taxes for the three months ended March 31, 2023, was mainly driven by the tax benefit of the pre-tax book loss, the change in valuation allowances on non-deductible U.S. interest expense carryforwards, the global intangible low-taxed income inclusion and stock compensation. The benefit was calculated using an estimated annual effective tax rate of 273.3%. The estimated annual effective tax rate is principally impacted by valuation allowances on non-deductible interest expense carryforwards, the global intangible low-taxed income inclusion and foreign tax expense, partially offset by the benefit of U.S. pre-tax book loss. The estimated annual effective tax rate is based on the projected tax expense for the full year. The total amount of unrecognized tax benefits that, if recognized, may impact the effective tax rate was approximately $50.7 million and $43.3 million as of March 31, 2023 and December 31, 2022, respectively. The amount of accrued interest and penalties payable related to unrecognized tax benefits was $4.2 million and $3.9 million as of March 31, 2023 and December 31, 2022, respectively. It is reasonably possible that further adjustments to our unrecognized tax benefits may be made within the next twelve months due to audit settlements and regulatory interpretations of existing tax laws. At this time, an estimate of potential change to the amount of unrecognized tax benefits cannot be made. The benefit for income taxes for the three months ended March 31, 2022, was mainly driven by pre-tax loss and the then current year tax benefit from the release of tax reserves, partially offset by the creation of valuation allowances on non-deductible interest expense carryforwards. The provision was calculated using the estimated annual effective tax rate of 41.3%. On August 16, 2022, the U.S. government enacted the Inflation Reduction Act of 2022 (the "Inflation Reduction Act"), which includes, among other provisions, changes to the U.S. corporate income tax system, including a 15% minimum tax based on "average adjusted financial statement income" exceeding $1 billion for any three consecutive years preceding the tax year and a 1% excise tax on net repurchases of stock in excess of $1 million after December 31, 2022. We do not anticipate a material financial impact from the Inflation Reduction Act during 2023. |
Supplemental equity information
Supplemental equity information | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Supplemental equity information | NOTE 10 — Supplemental equity information Income (loss) per share The following table sets forth the information to compute basic and diluted income (loss) per share: Three months ended March 31, In thousands, except per share data 2023 2022 Net income (loss) attributable to Gannett $ 10,344 $ (2,967) Basic weighted average shares outstanding 137,931 136,425 Effect of dilutive securities: Restricted stock grants 244 — Diluted weighted average shares outstanding 138,175 136,425 Income (loss) per share attributable to Gannett - basic $ 0.07 $ (0.02) Income (loss) per share attributable to Gannett - diluted $ 0.07 $ (0.02) The Company excluded the following securities from the computation of diluted income (loss) per share because their effect would have been antidilutive: Three months ended March 31, In thousands 2023 2022 Warrants 845 845 Stock options 6,068 6,068 Restricted stock grants (a) 4,840 12,403 2027 Notes (b) 97,057 97,057 (a) Includes Restricted stock awards ("RSAs"), Restricted stock units ("RSUs") and Performance stock units ("PSUs"). (b) Represents the total number of shares that would be convertible at March 31, 2023 and 2022 as stipulated in the 2027 Notes Indenture. The 2027 Notes may be converted at any time by the holders into cash, shares of the Company's Common Stock or any combination of cash and Common Stock, at the Company's election. Conversion of all of the 2027 Notes into Common Stock (assuming the maximum increase in the conversion rate as a result of a Make-Whole Fundamental Change but no other adjustments to the conversion rate), would result in the issuance of an aggregate of 287.2 million shares of Common Stock. The Company has excluded approximately 287.2 million shares from the income (loss) per share calculation, representing the total number of shares issuable assuming the maximum increase in the conversion rate. As of March 31, 2023, 97.1 million shares representing the total number of shares that would be convertible were excluded from the income (loss) per share calculation because their effect would be antidilutive. Share-based compensation Share-based compensation expense was $3.7 million and $3.4 million for the three months ended March 31, 2023 and 2022, respectively. The total compensation cost not yet recognized related to non-vested awards as of March 31, 2023 was $30.0 million, which is expected to be recognized over a weighted-average period of 2.2 years through May 2025. Equity awards During the three months ended March 31, 2023, a total of 4.7 million RSAs were granted. RSAs generally vest one-third on each of the first three anniversaries of the date of grant, subject to the participants' continued employment with the Company and the terms of the applicable award agreement. The weighted average grant date fair value of RSAs granted during the three months ended March 31, 2023 was $1.83. Preferred stock The Company has authorized 300,000 shares of preferred stock, par value $0.01 per share, issuable in one or more series designated by the Company's Board of Directors, of which 150,000 shares have been designated as Series A Junior Participating Preferred Stock, none of which are outstanding. There were no issuances of preferred stock during the three months ended March 31, 2023. Stock Repurchase Program On February 1, 2022, the Company's Board of Directors authorized the repurchase of up to $100 million (the "Stock Repurchase Program") of the Company's Common Stock. Repurchases may be made from time to time through open market purchases or privately negotiated transactions, pursuant to one or more plans established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, or by means of one or more tender offers, in each case, as permitted by securities laws and other legal requirements. The amount and timing of the purchases, if any, will depend on a number of factors including, but not limited to, the price and availability of the Company's shares, trading volume, capital availability, Company performance and general economic and market conditions. The Stock Repurchase Program may be suspended or discontinued at any time. Further, future repurchases under our Stock Repurchase Program may be subject to various conditions under the terms of our various debt instruments and agreements, unless an exception is available or we obtain a waiver or similar relief. During the three months ended March 31, 2023, the Company did not repurchase any shares of Common Stock under the Stock Repurchase Program. As of March 31, 2023, the remaining authorized amount under the Stock Repurchase Program was approximately $96.9 million. The Company does not anticipate repurchasing any shares of Common Stock pursuant to the Stock Repurchase Program during 2023. Accumulated other comprehensive loss The following tables summarize the components of, and the changes in, Accumulated other comprehensive loss, net of tax: Three months ended March 31, 2023 Three months ended March 31, 2022 In thousands Pension and postretirement benefit plans Foreign currency translation Total Pension and postretirement benefit plans Foreign currency translation Total Beginning balance $ (86,351) $ (14,880) $ (101,231) $ 50,870 $ 9,128 $ 59,998 Other comprehensive income (loss) before reclassifications, net of taxes 6,939 6,337 13,276 (811) (7,556) (8,367) Amounts reclassified from accumulated other comprehensive income (loss) (a)(b) 14 — 14 (24) — (24) Net current period other comprehensive income (loss), net of taxes 6,953 6,337 13,290 (835) (7,556) (8,391) Ending balance $ (79,398) $ (8,543) $ (87,941) $ 50,035 $ 1,572 $ 51,607 (a) Amounts reclassified from accumulated other comprehensive (loss) income are included in the computation of net periodic benefit cost. See Note 7 — Pensions and other postretirement benefit plans. (b) Amounts reclassified from accumulated other comprehensive (loss) income are recorded net of tax impacts of $6 thousand and $8 thousand for the three months ended March 31, 2023 and 2022, respectively. |
Commitments, contingencies and
Commitments, contingencies and other matters | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, contingencies and other matters | NOTE 11 — Commitments, contingencies and other matters Legal Proceedings The Company is and may become involved from time to time in legal proceedings in the ordinary course of its business, including but not limited to matters such as libel, invasion of privacy, intellectual property infringement, wrongful termination actions, complaints alleging employment discrimination, and regulatory investigations and inquiries. In addition, the Company is involved from time to time in governmental and administrative proceedings concerning employment, labor, environmental, and other claims. Insurance coverage mitigates potential loss for certain of these matters. Historically, such claims and proceedings have not had a material adverse effect on the Company's consolidated results of operations or financial position. We are also defendants in judicial and administrative proceedings involving matters incidental to our business. Although the Company is unable to predict with certainty the eventual outcome of any litigation, regulatory investigation or inquiry, in the opinion of management, the Company does not believe it is reasonably possible that its current and threatened legal proceedings will have a material adverse effect on the Company's business, financial position or consolidated results of operations. Given the inherent unpredictability of these types of proceedings, however, it is possible that future adverse outcomes could have a material effect on the Company's financial results. |
Segment reporting
Segment reporting | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment reporting | NOTE 12 — Segment reporting We define our reportable segments based on the way the Chief Operating Decision Maker ("CODM"), which is our Chief Executive Officer, manages the operations for purposes of allocating resources and assessing performance. Our reportable segments include the following: • Gannett Media is comprised of our portfolio of local, regional, national, and international newspaper publishers. The results of this segment include Advertising and marketing services revenues from local, classified, and national advertising across multiple platforms, including print, online, mobile, and tablet as well as niche publications, Circulation revenues from home delivery, digital distribution and single copy sales of our publications, and Other revenues, mainly from commercial printing, distribution arrangements, revenues from our events business, digital content syndication and affiliate revenues, and third-party newsprint sales. The Gannett Media reportable segment is an aggregation of two operating segments: Domestic Gannett Media and Newsquest. • Digital Marketing Solutions is comprised of our digital marketing services companies under the brand LocaliQ. The results of this segment include Advertising and marketing services revenues through multiple services, including search advertising, display advertising, search optimization, social media, website development, web presence products, customer relationship management, and software-as-a-service solutions. In addition to the reportable segments above, we have a Corporate and other category that includes activities not directly attributable to a specific segment. This category primarily consists of broad corporate functions, including legal, human resources, accounting, finance and marketing, as well as other general business costs. In the ordinary course of business, our reportable segments enter into transactions with one another. While intersegment transactions are treated like third-party transactions to determine segment performance, the revenues and expenses recognized by the segment that is the counterparty to the transaction are eliminated in consolidation and do not affect consolidated results. The CODM uses Adjusted EBITDA and Adjusted EBITDA margin to evaluate the performance of the segments and allocate resources. Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial performance measures we believe offer a useful view of the overall operation of our businesses and may be different than similarly-titled measures used by other companies. We define Adjusted EBITDA as Net income (loss) attributable to Gannett before (1) Income tax expense (benefit), (2) Interest expense, (3) Gains or losses on the early extinguishment of debt, (4) Non-operating pension income, (5) Loss on convertible notes derivative, (6) Depreciation and amortization, (7) Integration and reorganization costs, (8) Other operating expenses, including third-party debt expenses and acquisition costs, (9) Asset impairments, (10) Goodwill and intangible impairments, (11) Gains or losses on the sale or disposal of assets, (12) Share-based compensation, and (13) certain other non-recurring charges. We define Adjusted EBITDA margin as Adjusted EBITDA divided by total Operating revenues. Management considers Adjusted EBITDA and Adjusted EBITDA margin to be important metrics to evaluate and compare the ongoing operating performance of our segments on a consistent basis across reporting periods as they eliminate the effect of items that we do not believe are indicative of each segment's core operating performance. The following tables present our segment information: Three months ended March 31, 2023 In thousands Gannett Media Digital Marketing Solutions Corporate and other Intersegment Eliminations Consolidated Advertising and marketing services - external sales $ 228,030 $ 112,817 $ — $ — $ 340,847 Advertising and marketing services - intersegment sales 34,393 — — (34,393) — Circulation 241,285 — — — 241,285 Other 85,387 — 1,398 — 86,785 Total operating revenues $ 589,095 $ 112,817 $ 1,398 $ (34,393) $ 668,917 Adjusted EBITDA (non-GAAP basis) $ 57,263 $ 11,683 $ (6,044) $ — $ 62,902 Adjusted EBITDA margin (non-GAAP basis) 9.7 % 10.4 % NM NM 9.4 % NM indicates not meaningful. Three months ended March 31, 2022 In thousands Gannett Media Digital Marketing Solutions Corporate and other Intersegment Eliminations Consolidated Advertising and marketing services - external sales $ 265,405 $ 109,709 $ — $ — $ 375,114 Advertising and marketing services - intersegment sales 33,357 — — (33,357) — Circulation 288,602 — — — 288,602 Other 83,055 — 1,306 — 84,361 Total operating revenues $ 670,419 $ 109,709 $ 1,306 $ (33,357) $ 748,077 Adjusted EBITDA (non-GAAP basis) $ 68,648 $ 11,180 $ (15,657) $ — $ 64,171 Adjusted EBITDA margin (non-GAAP basis) 10.2 % 10.2 % NM NM 8.6 % NM indicates not meaningful. The following table presents our reconciliation of Net income (loss) attributable to Gannett to Adjusted EBITDA and Net income (loss) attributable to Gannett margin to Adjusted EBITDA margin: Three months ended March 31, In thousands 2023 2022 Net income (loss) attributable to Gannett $ 10,344 $ (2,967) Benefit for income taxes (17,329) (7,607) Interest expense 28,330 26,006 (Gain) loss on early extinguishment of debt (496) 2,743 Non-operating pension income (1,815) (18,213) Depreciation and amortization 43,698 47,783 Integration and reorganization costs 12,127 11,398 Other operating expenses 229 1,102 Asset impairments 5 854 Gain on sale or disposal of assets, net (17,681) (2,804) Share-based compensation expense 3,736 3,393 Other items 1,754 2,483 Adjusted EBITDA (non-GAAP basis) $ 62,902 $ 64,171 Net income (loss) attributable to Gannett margin 1.5 % (0.4) % Adjusted EBITDA margin (non-GAAP basis) 9.4 % 8.6 % |
Other supplemental information
Other supplemental information | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Other supplemental information | NOTE 13 — Other supplemental information Cash and cash equivalents, including restricted cash Cash equivalents represent highly liquid certificates of deposit which have original maturities of three months or less. Restricted cash is held as cash collateral for certain business operations. Restricted cash primarily consists of funding for letters of credit, cash held in an irrevocable grantor trust for our deferred compensation plans and cash held with banking institutions for insurance. The following table presents a reconciliation of cash, cash equivalents and restricted cash: March 31, In thousands 2023 2022 Cash and cash equivalents $ 83,074 $ 152,191 Restricted cash included in other current assets 1,275 1,105 Restricted cash included in pension and other assets 9,275 11,722 Total cash, cash equivalents and restricted cash $ 93,624 $ 165,018 Supplemental cash flow information The following table presents supplemental cash flow information, including non-cash investing and financing activities: Three months ended March 31, In thousands 2023 2022 Cash paid for taxes, net of refunds $ 953 $ 846 Cash paid for interest 10,499 7,531 Non-cash investing and financing activities: Accrued capital expenditures $ 342 $ 1,160 Accounts payable and accrued liabilities A breakout of Accounts payable and accrued liabilities is presented below: In thousands March 31, 2023 December 31, 2022 Accounts payable $ 154,859 $ 189,094 Compensation 60,241 87,937 Taxes (primarily property, sales, and payroll taxes) 12,373 11,940 Benefits 19,482 21,942 Interest 18,227 6,162 Other 39,730 34,773 Accounts payable and accrued liabilities $ 304,912 $ 351,848 |
Description of business and b_2
Description of business and basis of presentation (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The unaudited condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. As permitted under those rules, certain notes or other financial information that are normally required by U.S. GAAP have been condensed or omitted from these interim financial statements. The unaudited condensed consolidated financial statements should therefore be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. |
Use of estimates | Use of estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and footnotes thereto. Actual results could differ materially from those estimates. Significant estimates inherent in the preparation of the unaudited condensed consolidated financial statements include pension and postretirement benefit obligation assumptions, income taxes, and goodwill and intangible asset impairment analysis. |
Revenues (Tables)
Revenues (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregation of revenue | The following table presents our revenues disaggregated by source: Three months ended March 31, In thousands 2023 2022 Print advertising $ 147,954 $ 173,518 Digital advertising and marketing services 192,893 201,596 Total advertising and marketing services 340,847 375,114 Circulation 241,285 288,602 Other 86,785 84,361 Total revenues $ 668,917 $ 748,077 |
Schedule of deferred revenue | The following table presents the change in the deferred revenues balance by type of revenues: Three months ended March 31, 2023 Three months ended March 31, 2022 In thousands Advertising, marketing services, and other Circulation Total Advertising, marketing services, and other Circulation Total Beginning balance $ 46,327 $ 107,321 $ 153,648 $ 60,665 $ 124,173 $ 184,838 Acquisition — — — — 2,388 2,388 Cash receipts, net of refunds 65,632 207,486 273,118 76,125 237,860 313,985 Revenue recognized (72,663) (212,387) (285,050) (75,463) (240,169) (315,632) Ending balance $ 39,296 $ 102,420 $ 141,716 $ 61,327 $ 124,252 $ 185,579 |
Accounts receivable, net (Table
Accounts receivable, net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
Schedule of allowance for doubtful accounts | The following table presents changes in the allowance for doubtful accounts: Three months ended March 31, In thousands 2023 2022 Beginning balance $ 16,697 $ 16,470 Current period provision 1,383 (2,403) Write-offs charged against the allowance (4,839) (3,868) Recoveries of amounts previously written-off 1,199 942 Other 59 425 Ending balance $ 14,499 $ 11,566 |
Goodwill and intangible assets
Goodwill and intangible assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill, indefinite-lived intangible assets, and amortizable intangible assets | Goodwill and intangible assets consisted of the following: March 31, 2023 December 31, 2022 In thousands Gross carrying amount Accumulated Net carrying Gross carrying amount Accumulated Net carrying Finite-lived intangible assets: Advertiser relationships $ 446,162 $ 202,973 $ 243,189 $ 445,775 $ 192,032 $ 253,743 Other customer relationships 102,259 48,535 53,724 102,224 45,811 56,413 Subscriber relationships 251,090 133,959 117,131 251,083 126,899 124,184 Other intangible assets 68,780 57,614 11,166 68,780 55,932 12,848 Sub-total $ 868,291 $ 443,081 $ 425,210 $ 867,862 $ 420,674 $ 447,188 Indefinite-lived intangible assets: Mastheads 166,478 166,170 Total intangible assets $ 591,688 $ 613,358 Goodwill $ 533,469 $ 533,166 |
Integration and reorganizatio_2
Integration and reorganization costs (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring and Related Activities [Abstract] | |
Schedule of restructuring and related costs | The Company recorded severance-related expenses by segment as follows: Three months ended March 31, In thousands 2023 2022 Gannett Media $ 6,112 $ 5,177 Digital Marketing Solutions 20 9 Corporate and other 4,121 174 Total $ 10,253 $ 5,360 A roll-forward of the accrued severance and related expenses included in Accounts payable and accrued liabilities on the condensed consolidated balance sheets for the three months ended March 31, 2023 is as follows: In thousands Severance and Beginning balance $ 29,773 Restructuring provision included in integration and reorganization costs 10,253 Cash payments (18,178) Ending balance $ 21,848 |
Schedule of facility consolidation and other restructuring expenses | The Company recorded other restructuring-related costs by segment as follows: Three months ended March 31, In thousands 2023 2022 Gannett Media (a) $ (1,463) $ 544 Digital Marketing Solutions — 142 Corporate and other 3,337 5,352 Total $ 1,874 $ 6,038 (a) For the three months ended March 31, 2023, other restructuring-related costs decreased compared to the three months ended March 31, 2022, primarily due to the reversal of a withdrawal liability related to a multiemployer pension plan. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of debt | The Company's debt consisted of the following: March 31, 2023 December 31, 2022 (In millions) Principal balance Unamortized original issue discount Unamortized deferred financing costs Carrying value Principal balance Unamortized original issue discount Unamortized deferred financing costs Carrying value Senior Secured Term Loan $ 407.1 $ (7.8) $ (1.7) $ 397.6 $ 438.4 $ (8.9) $ (1.9) $ 427.6 2026 Senior Notes 339.1 (8.6) (6.7) 323.8 345.2 (9.4) (7.3) 328.5 2027 Notes 485.3 (78.0) (1.7) 405.6 485.3 (81.2) (1.7) 402.4 2024 Notes 3.3 — — 3.3 3.3 — — 3.3 Total debt $ 1,234.8 $ (94.4) $ (10.1) $ 1,130.3 $ 1,272.2 $ (99.5) $ (10.9) $ 1,161.8 Less: Current portion of long-term debt $ (60.5) $ — $ — $ (60.5) $ (60.5) $ — $ — $ (60.5) Non-current portion of long-term debt $ 1,174.3 $ (94.4) $ (10.1) $ 1,069.8 $ 1,211.7 $ (99.5) $ (10.9) $ 1,101.3 |
Pensions and other postretire_2
Pensions and other postretirement benefit plans (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Retirement Benefits [Abstract] | |
Schedule of defined benefit plan amounts recognized in other comprehensive income (loss) | Retirement plan costs include the following components: Pension benefits Postretirement benefits Three months ended March 31, Three months ended March 31, In thousands 2023 2022 2023 2022 Operating expenses: Service cost - benefits earned during the period $ 324 $ 475 $ 10 $ 15 Non-operating expenses: Interest cost on benefit obligations 21,201 18,649 632 451 Expected return on plan assets (23,668) (37,281) — — Amortization of prior service benefit 16 — — — Amortization of actuarial loss (gain) 540 20 (536) (52) Total non-operating (benefit) expense $ (1,911) $ (18,612) $ 96 $ 399 Total (benefit) expense for retirement plans $ (1,587) $ (18,137) $ 106 $ 414 |
Income taxes (Tables)
Income taxes (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of components of income tax expense | The following table outlines our pre-tax net loss and income tax amounts: Three months ended March 31, In thousands 2023 2022 Loss before income taxes $ (7,069) $ (10,709) Benefit for income taxes (17,329) (7,607) Effective tax rate 245.1 % 71.0 % |
Supplemental equity informati_2
Supplemental equity information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Schedule of income (loss) per share per share (basic and diluted) | The following table sets forth the information to compute basic and diluted income (loss) per share: Three months ended March 31, In thousands, except per share data 2023 2022 Net income (loss) attributable to Gannett $ 10,344 $ (2,967) Basic weighted average shares outstanding 137,931 136,425 Effect of dilutive securities: Restricted stock grants 244 — Diluted weighted average shares outstanding 138,175 136,425 Income (loss) per share attributable to Gannett - basic $ 0.07 $ (0.02) Income (loss) per share attributable to Gannett - diluted $ 0.07 $ (0.02) |
Schedule of securities excluded from computation of diluted income (loss) per share | The Company excluded the following securities from the computation of diluted income (loss) per share because their effect would have been antidilutive: Three months ended March 31, In thousands 2023 2022 Warrants 845 845 Stock options 6,068 6,068 Restricted stock grants (a) 4,840 12,403 2027 Notes (b) 97,057 97,057 (a) Includes Restricted stock awards ("RSAs"), Restricted stock units ("RSUs") and Performance stock units ("PSUs"). (b) Represents the total number of shares that would be convertible at March 31, 2023 and 2022 as stipulated in the 2027 Notes Indenture. |
Schedule of accumulated other comprehensive loss, net of tax | The following tables summarize the components of, and the changes in, Accumulated other comprehensive loss, net of tax: Three months ended March 31, 2023 Three months ended March 31, 2022 In thousands Pension and postretirement benefit plans Foreign currency translation Total Pension and postretirement benefit plans Foreign currency translation Total Beginning balance $ (86,351) $ (14,880) $ (101,231) $ 50,870 $ 9,128 $ 59,998 Other comprehensive income (loss) before reclassifications, net of taxes 6,939 6,337 13,276 (811) (7,556) (8,367) Amounts reclassified from accumulated other comprehensive income (loss) (a)(b) 14 — 14 (24) — (24) Net current period other comprehensive income (loss), net of taxes 6,953 6,337 13,290 (835) (7,556) (8,391) Ending balance $ (79,398) $ (8,543) $ (87,941) $ 50,035 $ 1,572 $ 51,607 (a) Amounts reclassified from accumulated other comprehensive (loss) income are included in the computation of net periodic benefit cost. See Note 7 — Pensions and other postretirement benefit plans. (b) Amounts reclassified from accumulated other comprehensive (loss) income are recorded net of tax impacts of $6 thousand and $8 thousand for the three months ended March 31, 2023 and 2022, respectively. |
Segment reporting (Tables)
Segment reporting (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information, by segment | The following tables present our segment information: Three months ended March 31, 2023 In thousands Gannett Media Digital Marketing Solutions Corporate and other Intersegment Eliminations Consolidated Advertising and marketing services - external sales $ 228,030 $ 112,817 $ — $ — $ 340,847 Advertising and marketing services - intersegment sales 34,393 — — (34,393) — Circulation 241,285 — — — 241,285 Other 85,387 — 1,398 — 86,785 Total operating revenues $ 589,095 $ 112,817 $ 1,398 $ (34,393) $ 668,917 Adjusted EBITDA (non-GAAP basis) $ 57,263 $ 11,683 $ (6,044) $ — $ 62,902 Adjusted EBITDA margin (non-GAAP basis) 9.7 % 10.4 % NM NM 9.4 % NM indicates not meaningful. Three months ended March 31, 2022 In thousands Gannett Media Digital Marketing Solutions Corporate and other Intersegment Eliminations Consolidated Advertising and marketing services - external sales $ 265,405 $ 109,709 $ — $ — $ 375,114 Advertising and marketing services - intersegment sales 33,357 — — (33,357) — Circulation 288,602 — — — 288,602 Other 83,055 — 1,306 — 84,361 Total operating revenues $ 670,419 $ 109,709 $ 1,306 $ (33,357) $ 748,077 Adjusted EBITDA (non-GAAP basis) $ 68,648 $ 11,180 $ (15,657) $ — $ 64,171 Adjusted EBITDA margin (non-GAAP basis) 10.2 % 10.2 % NM NM 8.6 % NM indicates not meaningful. The following table presents our reconciliation of Net income (loss) attributable to Gannett to Adjusted EBITDA and Net income (loss) attributable to Gannett margin to Adjusted EBITDA margin: Three months ended March 31, In thousands 2023 2022 Net income (loss) attributable to Gannett $ 10,344 $ (2,967) Benefit for income taxes (17,329) (7,607) Interest expense 28,330 26,006 (Gain) loss on early extinguishment of debt (496) 2,743 Non-operating pension income (1,815) (18,213) Depreciation and amortization 43,698 47,783 Integration and reorganization costs 12,127 11,398 Other operating expenses 229 1,102 Asset impairments 5 854 Gain on sale or disposal of assets, net (17,681) (2,804) Share-based compensation expense 3,736 3,393 Other items 1,754 2,483 Adjusted EBITDA (non-GAAP basis) $ 62,902 $ 64,171 Net income (loss) attributable to Gannett margin 1.5 % (0.4) % Adjusted EBITDA margin (non-GAAP basis) 9.4 % 8.6 % |
Other supplemental information
Other supplemental information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of cash and cash equivalents | The following table presents a reconciliation of cash, cash equivalents and restricted cash: March 31, In thousands 2023 2022 Cash and cash equivalents $ 83,074 $ 152,191 Restricted cash included in other current assets 1,275 1,105 Restricted cash included in pension and other assets 9,275 11,722 Total cash, cash equivalents and restricted cash $ 93,624 $ 165,018 |
Summary of restrictions on cash and cash equivalents | The following table presents a reconciliation of cash, cash equivalents and restricted cash: March 31, In thousands 2023 2022 Cash and cash equivalents $ 83,074 $ 152,191 Restricted cash included in other current assets 1,275 1,105 Restricted cash included in pension and other assets 9,275 11,722 Total cash, cash equivalents and restricted cash $ 93,624 $ 165,018 |
Schedule of cash flow, supplemental disclosures | The following table presents supplemental cash flow information, including non-cash investing and financing activities: Three months ended March 31, In thousands 2023 2022 Cash paid for taxes, net of refunds $ 953 $ 846 Cash paid for interest 10,499 7,531 Non-cash investing and financing activities: Accrued capital expenditures $ 342 $ 1,160 |
Schedule of accounts payable and accrued liabilities | A breakout of Accounts payable and accrued liabilities is presented below: In thousands March 31, 2023 December 31, 2022 Accounts payable $ 154,859 $ 189,094 Compensation 60,241 87,937 Taxes (primarily property, sales, and payroll taxes) 12,373 11,940 Benefits 19,482 21,942 Interest 18,227 6,162 Other 39,730 34,773 Accounts payable and accrued liabilities $ 304,912 $ 351,848 |
Description of business and b_3
Description of business and basis of presentation - Narrative (Details) | 3 Months Ended |
Mar. 31, 2023 segment state | |
Accounting Policies [Abstract] | |
Number of states in which entity operates | state | 43 |
Number of operating segments | segment | 2 |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue | ||
Total revenues | $ 668,917 | $ 748,077 |
Total advertising and marketing services | ||
Disaggregation of Revenue | ||
Total revenues | 340,847 | 375,114 |
Print advertising | ||
Disaggregation of Revenue | ||
Total revenues | 147,954 | 173,518 |
Digital advertising and marketing services | ||
Disaggregation of Revenue | ||
Total revenues | 192,893 | 201,596 |
Circulation | ||
Disaggregation of Revenue | ||
Total revenues | 241,285 | 288,602 |
Other | ||
Disaggregation of Revenue | ||
Total revenues | $ 86,785 | $ 84,361 |
Revenues - Narrative (Details)
Revenues - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
International | Revenue Benchmark | Geographic Concentration Risk | ||
Revenue, Initial Application Period Cumulative Effect Transition | ||
Revenue, percentage | 10.20% | 8.90% |
Revenues - Deferred Revenues Na
Revenues - Deferred Revenues Narrative (Details) - Customer Subscription - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | Mar. 31, 2023 |
Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | |
Expected timing of satisfaction | 1 month |
Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | |
Expected timing of satisfaction | 12 months |
Revenues - Deferred Revenue (De
Revenues - Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Movement in Deferred Revenue | ||
Beginning balance | $ 153,648 | $ 184,838 |
Acquisition | 0 | 2,388 |
Cash receipts, net of refunds | 273,118 | 313,985 |
Revenue recognized | (285,050) | (315,632) |
Ending balance | 141,716 | 185,579 |
Advertising, marketing services, and other | ||
Movement in Deferred Revenue | ||
Beginning balance | 46,327 | 60,665 |
Acquisition | 0 | 0 |
Cash receipts, net of refunds | 65,632 | 76,125 |
Revenue recognized | (72,663) | (75,463) |
Ending balance | 39,296 | 61,327 |
Circulation | ||
Movement in Deferred Revenue | ||
Beginning balance | 107,321 | 124,173 |
Acquisition | 0 | 2,388 |
Cash receipts, net of refunds | 207,486 | 237,860 |
Revenue recognized | (212,387) | (240,169) |
Ending balance | $ 102,420 | $ 124,252 |
Accounts receivable, net - Allo
Accounts receivable, net - Allowance for doubtful accounts (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Accounts Receivable, Allowance for Credit Loss | ||
Beginning balance | $ 16,697 | $ 16,470 |
Current period provision | 1,383 | (2,403) |
Write-offs charged against the allowance | (4,839) | (3,868) |
Recoveries of amounts previously written-off | 1,199 | 942 |
Other | 59 | 425 |
Ending balance | $ 14,499 | $ 11,566 |
Accounts receivable, net - Narr
Accounts receivable, net - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Receivables [Abstract] | ||
Bad debt expense (recovery) | $ 1,383 | $ (2,403) |
Goodwill and intangible asset_2
Goodwill and intangible assets - Schedule of goodwill and intangible assets (Detail) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets | ||
Gross carrying amount | $ 868,291 | $ 867,862 |
Accumulated amortization | 443,081 | 420,674 |
Net carrying amount | 425,210 | 447,188 |
Indefinite-lived intangible assets: | ||
Total intangible assets | 591,688 | 613,358 |
Goodwill | 533,469 | 533,166 |
Mastheads | ||
Indefinite-lived intangible assets: | ||
Non-amortized intangible assets | 166,478 | 166,170 |
Advertiser relationships | ||
Finite-Lived Intangible Assets | ||
Gross carrying amount | 446,162 | 445,775 |
Accumulated amortization | 202,973 | 192,032 |
Net carrying amount | 243,189 | 253,743 |
Other customer relationships | ||
Finite-Lived Intangible Assets | ||
Gross carrying amount | 102,259 | 102,224 |
Accumulated amortization | 48,535 | 45,811 |
Net carrying amount | 53,724 | 56,413 |
Subscriber relationships | ||
Finite-Lived Intangible Assets | ||
Gross carrying amount | 251,090 | 251,083 |
Accumulated amortization | 133,959 | 126,899 |
Net carrying amount | 117,131 | 124,184 |
Other intangible assets | ||
Finite-Lived Intangible Assets | ||
Gross carrying amount | 68,780 | 68,780 |
Accumulated amortization | 57,614 | 55,932 |
Net carrying amount | $ 11,166 | $ 12,848 |
Integration and reorganizatio_3
Integration and reorganization costs - Severance Related Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | $ 12,127 | $ 11,398 |
Severance | ||
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | 10,253 | 5,360 |
Operating Segments | Gannett Media | Severance | ||
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | 6,112 | 5,177 |
Operating Segments | Digital Marketing Solutions | Severance | ||
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | 20 | 9 |
Corporate and other | Severance | ||
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | $ 4,121 | $ 174 |
Integration and reorganizatio_4
Integration and reorganization costs - Restructuring Reserve (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Restructuring Reserve | ||
Restructuring provision included in integration and reorganization costs | $ 12,127 | $ 11,398 |
Severance | ||
Restructuring Reserve | ||
Beginning balance | 29,773 | |
Restructuring provision included in integration and reorganization costs | 10,253 | $ 5,360 |
Cash payments | (18,178) | |
Ending balance | $ 21,848 |
Integration and reorganizatio_5
Integration and reorganization costs - Facility Consolidation Charges and Accelerated Depreciation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | $ 12,127 | $ 11,398 |
Facility Closing | ||
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | 1,874 | 6,038 |
Operating Segments | Gannett Media | Facility Closing | ||
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | (1,463) | 544 |
Operating Segments | Digital Marketing Solutions | Facility Closing | ||
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | 0 | 142 |
Corporate and other | Facility Closing | ||
Restructuring Cost and Reserve | ||
Consolidation charges and other restructuring-related costs | $ 3,337 | $ 5,352 |
Debt - Schedule of Debt Outstan
Debt - Schedule of Debt Outstanding (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 | Oct. 15, 2021 | Nov. 17, 2020 |
Debt Instrument | ||||
Principal balance | $ 1,234,800,000 | $ 1,272,200,000 | ||
Unamortized original issue discount | (94,400,000) | (99,500,000) | ||
Unamortized deferred financing costs | (10,100,000) | (10,900,000) | ||
Long-term debt | 660,974,000 | 695,642,000 | ||
Principal outstanding | 1,130,300,000 | 1,161,800,000 | ||
Long term debt, gross, current | (60,500,000) | (60,500,000) | ||
Debt instrument unamortized discount current | 0 | 0 | ||
Debt issuance costs, current, net | 0 | 0 | ||
Long-term debt, current maturities | (60,500,000) | (60,500,000) | ||
Non-current debt, gross, noncurrent | 1,174,300,000 | 1,211,700,000 | ||
Debt instrument, unamortized discount, noncurrent | (94,400,000) | (99,500,000) | ||
Debt issuance costs, noncurrent, net | (10,100,000) | (10,900,000) | ||
Non-current portion of long-term debt | 1,069,800,000 | 1,101,300,000 | ||
Senior Secured Term Loan | Senior Secured Term Loan | ||||
Debt Instrument | ||||
Principal balance | 407,100,000 | 438,400,000 | $ 516,000,000 | |
Unamortized original issue discount | (7,800,000) | (8,900,000) | ||
Unamortized deferred financing costs | (1,700,000) | (1,900,000) | ||
Secured debt | 397,600,000 | 427,600,000 | ||
Senior Secured Term Loan | 2026 Senior Notes | ||||
Debt Instrument | ||||
Principal balance | 30,000,000 | |||
Senior Notes | 2026 Senior Notes | ||||
Debt Instrument | ||||
Principal balance | 339,100,000 | 345,200,000 | $ 400,000,000 | |
Unamortized original issue discount | (8,600,000) | (9,400,000) | ||
Unamortized deferred financing costs | (6,700,000) | (7,300,000) | ||
Long-term debt | 323,800,000 | 328,500,000 | ||
Convertible debt | 2027 Notes | ||||
Debt Instrument | ||||
Principal balance | 485,300,000 | 485,300,000 | $ 497,100,000 | |
Unamortized original issue discount | (78,000,000) | (81,200,000) | ||
Unamortized deferred financing costs | (1,700,000) | (1,700,000) | ||
Long-term debt | 405,600,000 | 402,400,000 | ||
Convertible debt | 2024 Notes | ||||
Debt Instrument | ||||
Principal balance | 3,300,000 | 3,300,000 | ||
Unamortized original issue discount | 0 | 0 | ||
Unamortized deferred financing costs | 0 | 0 | ||
Long-term debt | $ 3,300,000 | $ 3,300,000 |
Debt - Senior Secured Term Loan
Debt - Senior Secured Term Loan (Details) | 3 Months Ended | 12 Months Ended | ||||
Oct. 15, 2021 USD ($) | Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) amendment | Apr. 08, 2022 USD ($) plan | Jan. 31, 2022 USD ($) | |
Line of Credit Facility | ||||||
Principal balance | $ 1,234,800,000 | $ 1,272,200,000 | ||||
Cash paid for interest | 10,499,000 | $ 7,531,000 | ||||
Loss on early extinguishment of debt | (496,000) | 2,743,000 | ||||
Senior Secured Term Loan | Senior Secured Term Loan | ||||||
Line of Credit Facility | ||||||
Debt instrument term (in years) | 5 years | |||||
Principal balance | $ 516,000,000 | 407,100,000 | 438,400,000 | |||
Cash requirement | $ 100,000,000 | |||||
Amortization quarterly amount | $ 15,100,000 | |||||
First lien et leverage ratio | plan | 1.20 | |||||
Amortization quarterly amount upon ratio threshold | $ 7,600,000 | |||||
Interest expense | 10,300,000 | 6,900,000 | ||||
Cash paid for interest | 10,400,000 | 6,900,000 | ||||
Amortization of the discount | 800,000 | 900,000 | ||||
Amortization of debt issuance costs | 100,000 | 200,000 | ||||
Loss on early extinguishment of debt | 400,000 | $ 1,400,000 | ||||
Repayments of debt | $ 31,300,000 | |||||
Effective interest rate (as a percent) | 10.60% | |||||
Senior Secured Term Loan | Senior Secured Term Loan | Debt Covenant, Range One | ||||||
Line of Credit Facility | ||||||
First lien et leverage ratio | 2 | |||||
Maximum debt or equity purchasable | $ 25,000,000 | |||||
Senior Secured Term Loan | Senior Secured Term Loan | Debt Covenant, Range Two | ||||||
Line of Credit Facility | ||||||
First lien et leverage ratio | 1.50 | |||||
Maximum debt or equity purchasable | $ 50,000,000 | |||||
Senior Secured Term Loan | Senior Secured Term Loan | Debt Covenant, Range Three | ||||||
Line of Credit Facility | ||||||
First lien et leverage ratio | 1 | |||||
Senior Secured Term Loan | Senior Secured Term Loan | SOFR | ||||||
Line of Credit Facility | ||||||
Variable rate (as a percent) | 5% | |||||
Senior Secured Term Loan | Senior Secured Term Loan | Alternate Base Rate | ||||||
Line of Credit Facility | ||||||
Variable rate (as a percent) | 4% | |||||
Senior Secured Term Loan | Senior Secured Term Loan | Minimum | ||||||
Line of Credit Facility | ||||||
Unrestricted cash requirement | $ 30,000,000 | |||||
Senior Secured Term Loan | Senior Secured Term Loan | Minimum | SOFR | ||||||
Line of Credit Facility | ||||||
Variable rate (as a percent) | 0.50% | |||||
Senior Secured Term Loan | Senior Secured Term Loan | Minimum | Alternate Base Rate | ||||||
Line of Credit Facility | ||||||
Variable rate (as a percent) | 1.50% | |||||
Incremental Term Loans | Senior Secured Term Loan | ||||||
Line of Credit Facility | ||||||
Principal balance | $ 30,000,000 | $ 50,000,000 | ||||
Number of separate amendments | amendment | 2 |
Debt - Senior Secured Notes due
Debt - Senior Secured Notes due 2026 (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Oct. 15, 2021 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Line of Credit Facility | ||||
Principal balance | $ 1,234,800,000 | $ 1,272,200,000 | ||
Gain on early extinguishment of debt | 496,000 | $ (2,743,000) | ||
2026 Senior Notes | Senior Notes | ||||
Line of Credit Facility | ||||
Principal balance | $ 400,000,000 | 339,100,000 | 345,200,000 | |
Stated interest rate (as a percent) | 6% | |||
Mandatory and optional prepayments | 6,100,000 | 54,800,000 | ||
Gain on early extinguishment of debt | 900,000 | 2,600,000 | ||
Interest expense | 5,000,000 | 6,000,000 | ||
Interest paid | 100,000 | 600,000 | ||
Amortization of the discount | 600,000 | 700,000 | ||
Amortization of debt issuance costs | $ 500,000 | $ 600,000 | ||
Effective interest rate (as a percent) | 7.30% | |||
2026 Senior Notes | Senior Notes | Fair Value, Inputs, Level 2 | ||||
Line of Credit Facility | ||||
Debt fair value | $ 284,400,000 | 281,700,000 | ||
2026 Senior Notes | Senior Notes | Period 1 | ||||
Line of Credit Facility | ||||
Redemption price | 40% | |||
Redemption rate | 101% | |||
2026 Senior Notes | Senior Notes | Period 2 | ||||
Line of Credit Facility | ||||
Redemption price | 10% | |||
Redemption rate | 103% | |||
2026 Senior Notes | Senior Secured Term Loan | ||||
Line of Credit Facility | ||||
Principal balance | 30,000,000 | |||
Extinguishment of debt, amount | $ 30,000,000 |
Debt - Senior Secured Convertib
Debt - Senior Secured Convertible Notes due 2027 (Details) | 3 Months Ended | ||||
Nov. 17, 2020 USD ($) $ / shares shares | Mar. 31, 2023 USD ($) component $ / shares | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) $ / shares | Dec. 31, 2021 USD ($) | |
Line of Credit Facility | |||||
Principal balance | $ 1,234,800,000 | $ 1,272,200,000 | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |||
2027 Notes | Convertible debt | |||||
Line of Credit Facility | |||||
Principal balance | $ 497,100,000 | $ 485,300,000 | $ 485,300,000 | ||
Stated interest rate (as a percent) | 6% | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||
Debt instrument, share conversion rate (per $1,000) | 20% | ||||
Percentage of notes initially convertible to common stock | 42% | 41% | |||
Repurchased face amount | $ 11,800,000 | ||||
Minimum qualified cash required | $ 30,000,000 | ||||
Number of components | component | 2 | ||||
Fair value of equity component of debt | $ 279,600,000 | 279,600,000 | |||
Interest expense | 7,200,000 | $ 7,200,000 | |||
Amortization of the discount | 3,200,000 | 2,900,000 | |||
Amortization of debt issuance costs | $ 0 | $ 100,000 | |||
Effective interest rate (as a percent) | 10.50% | 10.50% | |||
2027 Notes | Convertible debt | Period 1 | |||||
Line of Credit Facility | |||||
Redemption rate | 110% | ||||
Maximum repurchase amount | $ 100,000,000 | ||||
Total gross leverage ratio | 1.5 | ||||
2027 Notes | Convertible debt | Period 2 | |||||
Line of Credit Facility | |||||
Redemption rate | 130% | ||||
Maximum repurchase amount | $ 99,400,000 | ||||
Redemption term | 4 years | ||||
2027 Notes | Fair Value, Inputs, Level 2 | Convertible debt | |||||
Line of Credit Facility | |||||
Debt fair value | $ 354,300,000 | $ 353,700,000 | |||
Scenario, Plan | 2027 Notes | Convertible debt | |||||
Line of Credit Facility | |||||
Initial conversion rate (in shares) | shares | 200 | ||||
Conversion price (in usd per share) | $ / shares | $ 5 |
Debt - Senior Convertible Notes
Debt - Senior Convertible Notes due 2024 (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Line of Credit Facility | ||
Long-term debt | $ 660,974 | $ 695,642 |
2024 Notes | Convertible debt | ||
Line of Credit Facility | ||
Long-term debt | $ 3,300 | $ 3,300 |
Stated interest rate (as a percent) | 4.75% | |
Effective interest rate (as a percent) | 6.05% |
Pensions and other postretire_3
Pensions and other postretirement benefit plans - Pension Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Non-operating expenses: | ||
Total non-operating (benefit) expense | $ (1,815) | $ (18,213) |
Pension benefits | ||
Operating expenses: | ||
Service cost - benefits earned during the period | 324 | 475 |
Non-operating expenses: | ||
Interest cost on benefit obligations | 21,201 | 18,649 |
Expected return on plan assets | (23,668) | (37,281) |
Amortization of prior service benefit | 16 | 0 |
Amortization of actuarial loss (gain) | 540 | 20 |
Total non-operating (benefit) expense | (1,911) | (18,612) |
Total (benefit) expense for retirement plans | (1,587) | (18,137) |
Postretirement benefits | ||
Operating expenses: | ||
Service cost - benefits earned during the period | 10 | 15 |
Non-operating expenses: | ||
Interest cost on benefit obligations | 632 | 451 |
Expected return on plan assets | 0 | 0 |
Amortization of prior service benefit | 0 | 0 |
Amortization of actuarial loss (gain) | (536) | (52) |
Total non-operating (benefit) expense | 96 | 399 |
Total (benefit) expense for retirement plans | $ 106 | $ 414 |
Pensions and other postretire_4
Pensions and other postretirement benefit plans - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 21 Months Ended |
Mar. 31, 2023 | Sep. 30, 2024 | |
Gannett Retirement Plan | ||
Defined Benefit Plan Disclosure | ||
Current funding status | 100% | |
Forecast | Gannett Retirement Plan | ||
Defined Benefit Plan Disclosure | ||
Defined benefit plan required funding status | 100% | |
Expected future employer contributions, quarterly certification funding requirement | $ 1 | |
Expected future employer contributions, quarterly certification funding requirement (maximum) | $ 5 | |
Pension benefits | ||
Defined Benefit Plan Disclosure | ||
Contribution to the defined benefit plans | $ 0.3 | |
Other Postretirement Benefits Plan | ||
Defined Benefit Plan Disclosure | ||
Contribution to the defined benefit plans | $ 1.9 |
Fair value measurement - Narrat
Fair value measurement - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Measurements, Nonrecurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Assets held for sale | $ 2.3 | $ 8.4 |
Income taxes - Pre-tax Net Loss
Income taxes - Pre-tax Net Loss and Income Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Loss before income taxes | $ (7,069) | $ (10,709) |
Benefit for income taxes | $ (17,329) | $ (7,607) |
Effective tax rate (percent) | 245.10% | 71% |
Income taxes - Narrative (Detai
Income taxes - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |||
Estimated annual effective tax rate (percent) | 273.30% | 41.30% | |
Unrecognized tax benefits that would impact effective tax rate | $ 50.7 | $ 43.3 | |
Unrecognized tax benefits, accrued interest and penalties | $ 4.2 | $ 3.9 |
Supplemental equity informati_3
Supplemental equity information - Income (Loss) Per Share (Basic and Diluted) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Equity [Abstract] | ||
Net income (loss) attributable to Gannett | $ 10,344 | $ (2,967) |
Basic weighted average shares outstanding (in shares) | 137,931 | 136,425 |
Effect of dilutive securities: | ||
Restricted stock grants (in shares) | 244 | 0 |
Diluted weighted average shares outstanding (in shares) | 138,175 | 136,425 |
Income (loss) per share attributable to Gannett - basic (in dollars per share) | $ 0.07 | $ (0.02) |
Income (loss) per share attributable to Gannett - diluted (in dollars per share) | $ 0.07 | $ (0.02) |
Supplemental equity informati_4
Supplemental equity information - Computation of Diluted Income (Loss) Per Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Warrants | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Antidilutive securities excluded from computation of diluted income per share (in shares) | 845 | 845 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Antidilutive securities excluded from computation of diluted income per share (in shares) | 6,068 | 6,068 |
Restricted stock grants | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Antidilutive securities excluded from computation of diluted income per share (in shares) | 4,840 | 12,403 |
2027 Notes | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Antidilutive securities excluded from computation of diluted income per share (in shares) | 97,057 | 97,057 |
Supplemental equity informati_5
Supplemental equity information - Narrative (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Stockholders Equity Note | ||
Share-based compensation cost | $ 3.7 | $ 3.4 |
Unrecognized compensation cost related to non-vested share-based compensation | $ 30 | |
Weighted average period (in years) | 2 years 1 month 28 days | |
2027 Notes | ||
Stockholders Equity Note | ||
Antidilutive securities excluded from computation of diluted income per share (in shares) | 97,057 | 97,057 |
Restricted Stock Awards | ||
Stockholders Equity Note | ||
Granted (in shares) | 4,700 | |
Granted (in dollars per share) | $ 1.83 | |
Restricted Stock Awards | Tranche One | ||
Stockholders Equity Note | ||
Vesting, percentage | 33.30% | |
Restricted Stock Awards | Tranche Two | ||
Stockholders Equity Note | ||
Vesting, percentage | 33.30% | |
Restricted Stock Awards | Tranche Three | ||
Stockholders Equity Note | ||
Vesting, percentage | 33.30% | |
2027 Notes | Convertible debt | ||
Stockholders Equity Note | ||
Aggregate shares receivable upon conversion (shares) | 287,200 | |
Shares excluded from the income loss per share (shares) | 287,200 |
Supplemental equity informati_6
Supplemental equity information - Preferred Stock and Stock Repurchase Program (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Dec. 31, 2022 | Feb. 01, 2022 | |
Class of Stock | |||
Preferred stock authorized (in shares) | 300,000 | 300,000 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Preferred stock, outstanding (in shares) | 0 | 0 | |
Preferred stock, issued (in shares) | 0 | 0 | |
Stock Repurchase Program | |||
Class of Stock | |||
Shares authorized for repurchase, value | $ 100 | ||
Repurchase of common stock (in shares) | 0 | ||
Remaining authorized shares for share repurchase program | $ 96.9 | ||
Series A Junior Participating Preferred Stock | |||
Class of Stock | |||
Preferred stock authorized (in shares) | 150,000 | 150,000 | |
Preferred stock, outstanding (in shares) | 0 |
Supplemental equity informati_7
Supplemental equity information - Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Beginning balance | $ 295,742 | |
Other comprehensive income (loss) before reclassifications, net of taxes | 13,276 | $ (8,367) |
Amounts reclassified from accumulated other comprehensive (loss) income | 14 | (24) |
Net current period other comprehensive income (loss), net of taxes | 13,290 | (8,391) |
Ending balance | 321,096 | |
Amounts reclassified from accumulated other comprehensive (loss) income | 6 | 8 |
Total | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Beginning balance | (101,231) | 59,998 |
Ending balance | (87,941) | 51,607 |
Pension and postretirement benefit plans | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Beginning balance | (86,351) | 50,870 |
Other comprehensive income (loss) before reclassifications, net of taxes | 6,939 | (811) |
Amounts reclassified from accumulated other comprehensive (loss) income | 14 | (24) |
Net current period other comprehensive income (loss), net of taxes | 6,953 | (835) |
Ending balance | (79,398) | 50,035 |
Foreign currency translation | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Beginning balance | (14,880) | 9,128 |
Other comprehensive income (loss) before reclassifications, net of taxes | 6,337 | (7,556) |
Amounts reclassified from accumulated other comprehensive (loss) income | 0 | 0 |
Net current period other comprehensive income (loss), net of taxes | 6,337 | (7,556) |
Ending balance | $ (8,543) | $ 1,572 |
Segment reporting - Narrative (
Segment reporting - Narrative (Details) | 3 Months Ended |
Mar. 31, 2023 segment | |
Segment Reporting Information | |
Number of operating segments | 2 |
Gannett Media | |
Segment Reporting Information | |
Number of operating segments | 2 |
Segment reporting -Segment Info
Segment reporting -Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information | ||
Total operating revenues | $ 668,917 | $ 748,077 |
Adjusted EBITDA (non-GAAP basis) | $ 62,902 | $ 64,171 |
Adjusted EBITDA margin (non-GAAP basis) (percent) | 9.40% | 8.60% |
Advertising and marketing services | ||
Segment Reporting Information | ||
Total operating revenues | $ 340,847 | $ 375,114 |
Circulation | ||
Segment Reporting Information | ||
Total operating revenues | 241,285 | 288,602 |
Other | ||
Segment Reporting Information | ||
Total operating revenues | 86,785 | 84,361 |
Operating Segments | Gannett Media | ||
Segment Reporting Information | ||
Total operating revenues | 589,095 | 670,419 |
Adjusted EBITDA (non-GAAP basis) | $ 57,263 | $ 68,648 |
Adjusted EBITDA margin (non-GAAP basis) (percent) | 9.70% | 10.20% |
Operating Segments | Gannett Media | Advertising and marketing services | ||
Segment Reporting Information | ||
Total operating revenues | $ 228,030 | $ 265,405 |
Operating Segments | Gannett Media | Circulation | ||
Segment Reporting Information | ||
Total operating revenues | 241,285 | 288,602 |
Operating Segments | Gannett Media | Other | ||
Segment Reporting Information | ||
Total operating revenues | 85,387 | 83,055 |
Operating Segments | Digital Marketing Solutions | ||
Segment Reporting Information | ||
Total operating revenues | 112,817 | 109,709 |
Adjusted EBITDA (non-GAAP basis) | $ 11,683 | $ 11,180 |
Adjusted EBITDA margin (non-GAAP basis) (percent) | 10.40% | 10.20% |
Operating Segments | Digital Marketing Solutions | Advertising and marketing services | ||
Segment Reporting Information | ||
Total operating revenues | $ 112,817 | $ 109,709 |
Operating Segments | Digital Marketing Solutions | Circulation | ||
Segment Reporting Information | ||
Total operating revenues | 0 | 0 |
Operating Segments | Digital Marketing Solutions | Other | ||
Segment Reporting Information | ||
Total operating revenues | 0 | 0 |
Corporate and other | ||
Segment Reporting Information | ||
Total operating revenues | 1,398 | 1,306 |
Adjusted EBITDA (non-GAAP basis) | (6,044) | (15,657) |
Corporate and other | Advertising and marketing services | ||
Segment Reporting Information | ||
Total operating revenues | 0 | 0 |
Corporate and other | Circulation | ||
Segment Reporting Information | ||
Total operating revenues | 0 | 0 |
Corporate and other | Other | ||
Segment Reporting Information | ||
Total operating revenues | 1,398 | 1,306 |
Intersegment Eliminations | ||
Segment Reporting Information | ||
Total operating revenues | (34,393) | (33,357) |
Intersegment Eliminations | Advertising and marketing services | ||
Segment Reporting Information | ||
Total operating revenues | (34,393) | (33,357) |
Intersegment Eliminations | Gannett Media | Advertising and marketing services | ||
Segment Reporting Information | ||
Total operating revenues | $ 34,393 | $ 33,357 |
Segment reporting - Reconciliat
Segment reporting - Reconciliation of EBITDA to Operating Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting [Abstract] | ||
Net income (loss) attributable to Gannett | $ 10,344 | $ (2,967) |
Benefit for income taxes | (17,329) | (7,607) |
Interest expense | 28,330 | 26,006 |
(Gain) loss on early extinguishment of debt | (496) | 2,743 |
Non-operating pension income | (1,815) | (18,213) |
Depreciation and amortization | 43,698 | 47,783 |
Integration and reorganization costs | 12,127 | 11,398 |
Other operating expenses | 229 | 1,102 |
Asset impairments | 5 | 854 |
Gain on sale or disposal of assets, net | (17,681) | (2,804) |
Share-based compensation expense | 3,736 | 3,393 |
Other items | 1,754 | 2,483 |
Adjusted EBITDA (non-GAAP basis) | $ 62,902 | $ 64,171 |
Net income (loss) attributable to Gannett margin (percent) | 1.50% | (0.40%) |
Adjusted EBITDA margin (non-GAAP basis) (percent) | 9.40% | 8.60% |
Other supplemental informatio_2
Other supplemental information - cash, cash equivalents and restricted cash (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 83,074 | $ 94,255 | $ 152,191 | |
Restricted cash included in other current assets | 1,275 | 1,105 | ||
Restricted cash included in pension and other assets | 9,275 | 11,722 | ||
Total cash, cash equivalents and restricted cash | $ 93,624 | $ 104,804 | $ 165,018 | $ 143,619 |
Other supplemental informatio_3
Other supplemental information - cash flow information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Cash paid for taxes, net of refunds | $ 953 | $ 846 |
Cash paid for interest | 10,499 | 7,531 |
Non-cash investing and financing activities: | ||
Accrued capital expenditures | $ 342 | $ 1,160 |
Other supplemental informatio_4
Other supplemental information - Accounts payable and accrued liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accounts payable | $ 154,859 | $ 189,094 |
Compensation | 60,241 | 87,937 |
Taxes (primarily property, sales, and payroll taxes) | 12,373 | 11,940 |
Benefits | 19,482 | 21,942 |
Interest | 18,227 | 6,162 |
Other | 39,730 | 34,773 |
Accounts payable and accrued liabilities | $ 304,912 | $ 351,848 |