GRAY MEDIA INC
For the period ended Dec 31, 2024. Filed Feb 27, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 27, 2025
GTN-A$5.70-4.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-23.
0001437749-24-005295
Item 7. MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-27.
0001437749-25-005406
Item 7. MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 84 previous paragraphs and 92 current paragraphs.
40 unchanged; 33 reworded; 19 added; 11 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 38 previous and 35 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (19)
Current report
2024 Refinancing and Debt Reduction Activities. During 2024 we completed several steps to enhance our liquidity, to extend the maturity of portions of our debt obligations that were scheduled to mature in the near future and to reduce the principal amount of our debt outstanding. Please refer to Note 4. “Long-Term Debt” for further information. During 2024, we:
Current report
In addition, in the year ended December 31, 2024 we used $327 million of cash to repurchase and retire an aggregate principal amount of $373 million of our outstanding 2019 Term Loan, 2027 Notes, 2030 Notes and 2031 Notes on the open market. Currently, our Board of Directors has authorized us to make additional open market repurchases of our indebtedness of $250 million.
Current report
Together with other payments at par, collectively, these actions resulted in a $520 million reduction in the principal amount of our outstanding indebtedness at December 31, 2024, as compared to December 31, 2023.
Current report
During 2024:
Current report
During 2024:
Current report
*Impairment of goodwill and other intangible assets.*In 2024 we did not incur impairment charges, compared to $43 million of impairment charges incurred in 2023.
Current report
Miscellaneous Income, Net. Miscellaneous income, net totaled $117 million and $7 million in 2024 and 2023, respectively. Miscellaneous income, net in 2024 was due primarily to a gain of $110 million from the sale of our investment in BMI.
Current report
*Interest Expense.*Interest expense increased $45 million, or 10%, to $485 million for 2024 compared to 2023. This increase was primarily attributable to several factors including: increases in average interest rates on all of our debt to 7.2% in 2024 compared to 6.5% in 2023, partially offset by a decrease in the outstanding principal balances of our debt, for a net increase of $22 million; a reduction in the amount of capitalized construction period of interest which increased interest expense by $19 million; an increase in deferred financing cost amortization, consistent with our 2024 refinancing activities, which increased interest expense by $2 million; and an increase in the amortization of costs related to our interest rate caps which increased interest expense by $2 million.
Current report
Gain (Loss) on Early Extinguishment of Debt. We recorded a gain on the early extinguishment of debt of $34 million in 2024, primarily as a result of our open-market repurchases of debt, partially offset by the write-off of deferred financing costs related to the open-market repurchases and expenses incurred related to our refinancing activities. We recorded a loss on the early extinguishment of debt of $3 million in 2023 related the write-off of deferred financing costs related to the partial repayment of a portion of our 2017 Term Loan.
Current report
*Liquidity.*Based on our debt outstanding as of December 31, 2024, we estimate that we will make approximately $450 million in debt interest payments over the twelve months immediately following December 31, 2024. Although our cash flows from operations are subject to a number of risks and uncertainties, we anticipate that our cash on hand, future cash expected to be generated from operations, borrowings from time to time under the Senior Credit Agreement (or any such other credit facility as may be in place at the appropriate time) and, potentially, external equity or debt financing, will be sufficient to fund any debt service obligations, estimated capital expenditures and acquisition-related obligations for the next twelve months and the forseeable future. Any potential equity or debt financing would depend upon, among other things, the costs and availability of such financing at the appropriate time. We also believe that our future cash expected to be generated from operations and borrowing availability under the Senior Credit Agreement (or any such other credit facility) will be sufficient to fund our future capital expenditures and long-term debt service obligations for the next twelve months and the forseeable future.
Current report
Collateral, Covenants and Restrictions of our Credit Agreements. Our obligations under the Senior Credit Agreement and the 2029 Notes are secured by substantially all of our consolidated assets, excluding real estate. In addition, substantially all of our subsidiaries are joint and several guarantors of, and our ownership interests in those subsidiaries are pledged to collateralize, our obligations under the Senior Credit Agreement. Gray Media, Inc. is a holding company, and has no material independent assets or operations. For all applicable periods, the 2026 Notes, 2027 Notes, 2030 Notes and 2031 Notes have been fully and unconditionally guaranteed, on a joint and several, senior unsecured basis, by substantially all of Gray Media, Inc.’s subsidiaries. Any subsidiaries of Gray Media, Inc. that do not guarantee the 2026 Notes, 2027 Notes, 2030 Notes and 2031 Notes are not material or are designated as unrestricted under the Senior Credit Agreement. As of December 31, 2024, there were no significant restrictions on the ability of Gray Media, Inc.’s subsidiaries to distribute cash to Gray or to the guarantor subsidiaries.
Current report
The Senior Credit Agreement contains affirmative and restrictive covenants with which we must comply, including: (a) limitations on additional indebtedness, (b) limitations on liens, (c) limitations on the sale of assets, (d) limitations on guarantees, (e) limitations on investments and acquisitions, (f) limitations on the payment of dividends and share repurchases, (g) limitations on mergers and (h) maintenance of the First Lien Leverage Ratio while any amount is outstanding under the revolving credit facility, as well as other customary covenants for credit facilities of this type. The 2026 Notes, 2027 Notes, 2029 Notes, 2030 Notes and 2031 Notes include covenants with which we must comply which are typical for financing transactions of their nature. As of December 31, 2024, we were in compliance with all required covenants under all of our debt obligations.
Current report
In addition to results prepared in accordance with U.S. GAAP, “Leverage Ratio Denominator” is a metric that management uses to calculate our compliance with our financial covenants in our indebtedness agreements. This metric is calculated as specified in our Senior Credit Agreement and is a significant measure that represents the denominator of a formula used to calculate compliance with material financial covenants within the Senior Credit Agreement that govern our ability to incur indebtedness, incur liens, make investments and make restricted payments, among other limitations usual and customary for credit agreements of this type. Accordingly, management believes this metric is a very material metric to our debt and equity investors.
Current report
Leverage Ratio Denominator gives effect to the revenue and broadcast expenses of all completed acquisitions and divestitures as if they had been acquired or divested, respectively, on January 1, 2023. It also gives effect to certain operating synergies expected from the acquisitions and related financings, and adds back professional fees incurred in completing the acquisitions. Certain of the financial information related to the acquisitions, if applicable, has been derived from, and adjusted based on, unaudited, un-reviewed financial information prepared by other entities, which Gray cannot independently verify. We cannot assure you that such financial information would not be materially different if such information were audited or reviewed and no assurances can be provided as to the accuracy of such information, or that our actual results would not differ materially from this financial information if the acquisitions had been completed on the stated date. In addition, the presentation of Leverage Ratio Denominator as determined in the Senior Credit Agreement and the adjustments to such information, including expected synergies, if applicable, resulting from such transactions, may not comply with U.S. GAAP or the requirements for pro forma financial information under Regulation S-X under the Securities Act of 1933. Leverage Ratio Denominator, as determined in the Senior Credit Agreement, represents an average amount for the preceding eight quarters then ended.
Current report
Our “Adjusted Total Indebtedness”, “First Lien Adjusted Total Indebtedness” and “Secured Adjusted Total Indebtedness”, in each case “Net of All Cash”, represents the amount of outstanding principal of our long-term debt, plus certain other obligations as defined in our Senior Credit Agreement, less all cash (excluding restricted cash) for the applicable amount of indebtedness.
Current report
Below is a calculation of our “Leverage Ratio”, “First Lien Leverage Ratio” and “Secured Leverage Ratio” as defined in our Senior Credit Agreement as of December 31, 2024:
Current report
Calculation of Leverage Ratio, First Lien Leverage Ratio and Secured Leverage Ratio, as each is defined in our Senior Credit Agreement (Unaudited):
Current report
(1) At any time any amounts are outstanding under our revolving credit facility, our maximum First Lien Leverage Ratio cannot exceed 4.25 to 1.00.
Current report
In December 2024, we entered into a series of agreements through which we anticipate receiving approximately $35 million in return for (a) all of Gray’s interests in certain third-party leases for space at Gray-owned tower sites, and (b) the exclusive right to market and lease space at those Gray-owned tower sites to third parties. We will retain ownership and control of each such tower site and will not incur any additional operating costs with respect to the subject tower sites. We anticipate closing the transactions at various times during 2025, with the majority of closings occurring in the first half of 2025.
Removed paragraphs (11)
Previous report
Impact of Recent Acquisitions and Divestitures. During 2022 and 2021 we completed several transactions that have, collectively, had a significant impact on our financial condition, results of operations and cash flows. We refer to these transactions collectively as the “Acquisitions”. Please see Note 3 “Acquisitions and Divestitures” in our consolidated financial statements contained elsewhere herein for further discussion of the Acquisitions. The impact of the Acquisitions is described in more detail in the following discussion of our operating results. The most significant of the transactions were:
Previous report
The following table summarizes the “Transaction Related Expenses” incurred in connection with the Acquisitions during the year ended December 31, 2023, 2022 and 2021, by type and by financial statement line item (in millions):
Previous report
Impairment of Goodwill and Other Intangible Assets. Several years ago, our Raycom Sports subsidiary sublicensed certain ACC football and basketball games from ESPN to Fox Sports that were assumed by Diamond upon its acquisition of Fox Sports. In March 2023, Diamond sought bankruptcy protection. On July 7, 2023, the bankruptcy court granted the request of Diamond (supported by us) for the early rejection, and therefore the termination, of the ACC sports rights agreements. On July 13, 2023, The CW announced that it had entered into an agreement with Raycom Sports for a similar package of sports rights related to the ACC games that had been included in the now-terminated agreement with Diamond. Concurrently, Raycom Sports and ESPN modified their license agreement to correspond with the terms of The CW sublicense agreement. The new agreements mitigate a portion of the losses caused by Diamond’s rejection of its ACC sports rights agreement with Raycom Sports. As a result of the bankruptcy filings and these new July 2023 agreements, our production companies segment recorded a non-cash charge of $43 million, for impairment of goodwill and other intangible assets.
Previous report
Miscellaneous Income (Expense), Net. Miscellaneous income, net totaled $7 million in 2023 and miscellaneous expense, net totaled $4 million 2022.
Previous report
*Interest Expense.*Interest expense increased $86 million, or 24%, to $440 million for 2023 compared to 2022. This increase was primarily attributable to the increase in average interest rates on our outstanding debt, net of the impact of our pre-payment of our outstanding 2017 Term Loan balance. Excluding amounts recorded as interest expense resulting from the amortization of deferred financing costs, the average interest rate on all of our outstanding debt increased to 6.5% in 2023 compared to 5.1% in 2022. The average outstanding principal balance of all our debt was $6.3 billion and $6.7 billion during 2023 and 2022, respectively.
Previous report
We believe that our cash balance, our cash flow from operations and availability under our Revolving Credit Facility provide us with sufficient liquidity to fund our core operations, maintain key personnel and meet our other material obligations for at least the next twelve months and the foreseeable future. See below for more information on our liquidity and capital resources.
Previous report
Exchange of television stations. On February 1, 2024, we announced that we have entered into agreements with Marquee Broadcasting, Inc. (“Marquee”) to exchange television stations. Under the terms of the agreement, our television stations in the Cheyenne-Scottsbluff and Casper television markets (DMAs 194 and 198, respectively) are expected to be sold to Marquee in exchange for Marquee’s FCC permit authorizing the construction of new television station, that will be built in the Salt Lake City, Utah market (DMA 27), and will be known as KCBU. Neither party will pay additional cash or consideration to fulfill the terms of this exchange. The transactions are expected to close simultaneously in the second quarter of 2024 and are subject to the customary closing conditions and the receipt of regulatory and other approvals.
Previous report
BMI Investment Proceeds. On February 8, 2024, we received $110 million in pre-tax cash proceeds from the closing of the previously announced sale of Broadcast Music, Inc. (“BMI”) to a shareholder group led by New Mountain Capital, LLC. $50 million of the net proceeds from the sale of BMI were used to pay in full the amount then outstanding under are Revolving Credit Facility. We intend to use the remaining proceeds for general corporate purposes.
Previous report
Amendment of Revolving Credit Facility. On February 16, 2024, Gray entered into a second amendment (the “Second Amendment”) to its Senior Credit Facility. The Second Amendment, among other things, (i) increases the aggregate commitments under the Gray’s existing $500 million Revolving Credit Facility by $125 million, resulting in aggregate commitments under the Revolving Credit Facility of $625 million and (ii) extends the maturity date of a $552.5 million tranche of the Revolving Credit Facility to December 31, 2027 (subject to a springing maturity in certain circumstances set forth in the Second Amendment), with a remaining non-extending tranche of the Revolving Credit Facility of $72.5 million maturing on December 1, 2026 (subject to a springing maturity in certain circumstances set forth in the Second Amendment). Except as modified by the Amendment, the existing terms of the Senior Credit Facility remain in effect.
Previous report
*Executive Update.*On February 20, 2024, we announced that our Chief Financial Officer, Jim Ryan has notified us of his voluntary decision to transition into retirement after 2025. We also announced the hiring of Jeff Gignac, who currently serves as a Managing Director and Head of Media & Telecom Investment Banking at Wells Fargo Securities. Mr. Gignac will join us, initially as Executive Vice President, Finance, on April 1, 2024, and he will step into Mr. Ryan’s role as Executive Vice President, Chief Financial Officer on July 1, 2024. Mr. Ryan will work closely with Mr. Gignac and our entire executive team until he retires at the end of 2025.
Previous report
*Income Taxes.*As of December 31, 2023, we have an aggregate of approximately $299 million of various state operating loss carryforwards, of which we expect that approximately one-third will be utilized. We expect that approximately $201 million of these state net operating loss carryforwards will not be utilized due to section 382 limitations and those that will expire prior to utilization.
Reworded paragraphs (33)
Previous wording
Introduction. The following discussion and analysis of the financial condition and results of operations of Gray Television, Inc. and its consolidated subsidiaries (except as the context otherwise provides, “Gray,” the “Company,” “we,” “us” or “our”) should be read in conjunction with our audited consolidated financial statements and notes thereto included elsewhere herein.
Current wording
Introduction. The following discussion and analysis of the financial condition and results of operations of Gray Media, Inc. and its consolidated subsidiaries (except as the context otherwise provides, “Gray,” the “Company,” “we,” “us” or “our”) should be read in conjunction with our audited consolidated financial statements and notes thereto included elsewhere herein.
Previous wording
This section of our Annual Report on Form 10-K discusses 2023 and 2022 items and year-over-year comparisons between 2023 and 2022. A detailed discussion of 2021 items and year-over-year comparisons between 2022 and 2021 that are not included in this Annual Report on Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7. of our Annual Report on Form 10-K for the year ended December 31, 2022.
Current wording
This section of our Annual Report discusses 2024 and 2023 items and year-over-year comparisons between 2024 and 2023. A detailed discussion of 2022 items and year-over-year comparisons between 2023 and 2022 that are not included in this Annual Report can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7. of our Annual Report for the year ended December 31, 2023.
Previous wording
Business Overview. We are a multimedia company headquartered in Atlanta, Georgia. We are the nation’s largest owner of top-rated local television stations and digital assets in the United States. Our television stations serve 113 television markets that collectively reach approximately 36 percent of US television households. This portfolio includes 79 markets with the top-rated television station and 102 markets with the first and/or second highest rated television station. We also own video program companies Raycom Sports, Tupelo Media Group, PowerNation Studios, as well as the studio production facilities Assembly Atlanta and Third Rail Studios.
Current wording
Business Overview. We are a multimedia company headquartered in Atlanta, Georgia. We are the nation’s largest owner of top-rated local television stations and digital assets serving 113 television markets that collectively reach approximately 37 percent of US television households. The portfolio includes 78 markets with the top-rated television station and 99 markets with the first and/or second highest rated television station, as well as the largest Telemundo Affiliate group with 44 markets totaling over 1.5 million Hispanic TV Households. We also own Gray Digital Media, a full-service digital agency offering national and local clients digital marketing strategies with the most advanced digital products and services. Our additional media properties include video production companies Raycom Sports, Tupelo Media Group, and PowerNation Studios, and studio production facilities Assembly Atlanta and Third Rail Studios.
Previous wording
Our operating revenues are derived primarily from broadcast and internet advertising, retransmission consent fees and, to a lesser extent, other sources such as production of television and event programming, television commercials, tower rentals and management fees. For the years ended December 31, 2023, 2022 and 2021, we generated revenue of $3.3 billion, $3.7 billion and $2.4 billion, respectively.
Current wording
Our operating revenues are derived primarily from broadcast and digital advertising, retransmission consent fees and, to a lesser extent, other sources such as production of television and event programming, television commercials, tower rentals and management fees. For the years ended December 31, 2024, 2023 and 2022, we generated revenue of $3.6 billion, $3.3 billion and $3.7 billion, respectively.
Previous wording
We also sell internet advertising on our stations’ websites and mobile apps. These advertisements may be sold as banner advertisements, video advertisements and other types of advertisements or sponsorships.
Current wording
We also sell digital advertising on our stations’ websites and mobile apps. These advertisements may be sold as banner advertisements, video advertisements and other types of advertisements or sponsorships.
Previous wording
Our broadcast and internet advertising revenues are affected by several factors that we consider to be seasonal in nature. These factors include:
Current wording
Our broadcast and digital advertising revenues are affected by several factors that we consider to be seasonal in nature. These factors include:
Previous wording
We derived a material portion of our non-political broadcast advertising revenue from advertisers in a limited number of industries, particularly the services sector, comprising financial, legal and medical advertisers, and the automotive industry. The services sector has become an increasingly important source of advertising revenue over the past few years. During the years ended December 31, 2023, 2022 and 2021 approximately 27%, 28% and 29%, respectively, of our broadcast advertising revenue (excluding political advertising revenue) was obtained from advertising sales to the services sector. During the years ended December 31, 2023, 2022 and 2021 approximately 20%, 17% and 17%, respectively, of our broadcast advertising revenue (excluding political advertising revenue) was obtained from advertising sales to automotive customers. Revenue from these industries may represent a higher percentage of total revenue in odd-numbered years due to, among other things, the increased availability of advertising time, as a result of such years being the “off year” of the two-year election cycle.
Current wording
We derived a material portion of our non-political broadcast advertising revenue from advertisers in a limited number of industries, particularly the services sector, comprising financial, legal and medical advertisers, and the automotive industry. The services sector has become an increasingly important source of advertising revenue over the past few years. During the years ended December 31, 2024, 2023 and 2022 approximately 23%, 27% and 28%, respectively, of our broadcast advertising revenue (excluding political advertising revenue) was obtained from advertising sales to the services sector. During the years ended December 31, 2024, 2023 and 2022 approximately 20%, 20% and 17%, respectively, of our broadcast advertising revenue (excluding political advertising revenue) was obtained from advertising sales to automotive customers. Revenue from these industries may represent a lower percentage of total revenue in even-numbered years due to, among other things, the decreased availability of advertising time, as a result of such years being the “on-year” of the two-year election cycle.
Previous wording
*Revenue.*Total revenue decreased $395 million, or 11%, to $3.3 billion for 2023 compared to 2022. During 2023:
Current wording
*Revenue.*Total revenue increased $363 million, or 11%, to $3.6 billion for 2024 compared to 2023.
Previous wording
Broadcasting Expenses. Broadcasting expenses (before depreciation, amortization, impairment and gain on disposal of assets) increased $103 million, or 5%, to $2.3 billion for 2023, compared to 2022**.**During 2023:
Current wording
Broadcasting Expenses. Broadcasting expenses (before depreciation, amortization, impairment and gain on disposal of assets) increased $49 million, or 2%, to $2.3 billion for 2024, compared to 2023**.**
Previous wording
Production Company Expenses. Production company expenses (before depreciation, amortization, impairment and gain or loss on disposal of assets) increased by approximately $32 million in 2023 to $115 million, compared to $83 million in 2022. Production company operating expenses included $17 million allowance for credit losses related to the bankruptcy of Diamond, a counterparty in contracts with us and $18 million to settle litigation related to the Assembly Atlanta project.
Current wording
Production Company Expenses. Production company expenses (before depreciation, amortization, impairment and gain or loss on disposal of assets) decreased by approximately $32 million in 2024 to $83 million, compared to $115 million in 2023. Production company operating expenses decreased in 2024 primarily due to significant expenses incurred in 2023, which did not re-occur in 2024.
Previous wording
Corporate and administrative expenses. Corporate and administrative expenses (before depreciation, amortization, impairment and gain or loss on disposal of assets) increased by $8 million, or 8%, to $112 million in 2023 compared to 2022, primarily as a result of; increases in compensation expense of $4 million, increases in professional services costs of $6 million and decreases in transaction related legal and other professional services of $2 million in 2023. We recorded corporate non-cash stock-based amortization expense of $15 million and $18 million in 2023 and 2022, respectively.
Current wording
Corporate and administrative expenses. Corporate and administrative expenses (before depreciation, amortization, impairment and gain or loss on disposal of assets) decreased by $8 million, or 7%, to $104 million in 2024 compared to $112 million in 2023, primarily as a result of decreases in professional services costs. We recorded corporate non-cash stock-based compensation expense of $17 million and $15 million in 2024 and 2023, respectively.
Previous wording
Depreciation. Depreciation of property and equipment totaled $145 million and $129 million for 2023 and 2022, respectively. Depreciation increased primarily due to the addition of depreciable assets.
Current wording
Depreciation. Depreciation of property and equipment totaled $144 million and $145 million for 2024 and 2023, respectively.
Previous wording
*Amortization of intangible assets.*Amortization of intangible assets totaled $194 million and $207 million for 2023 and 2022, respectively. Amortization decreased primarily due to finite-lived intangible assets becoming fully amortized.
Current wording
*Amortization of intangible assets.*Amortization of intangible assets totaled $125 million and $194 million for 2024 and 2023, respectively. Amortization decreased primarily due to finite-lived intangible assets becoming fully amortized.
Previous wording
*Loss (Gain) on Disposals of Assets, Net.*We recognized a loss on disposal of assets of $21 million in 2023 compared to a gain on disposal of assets of $2 million in 2022, primarily related to the sale of television station KNIN in the Boise, Idaho market, in which we recognized a loss of $14 million in 2023.
Current wording
*Loss on Disposals of Assets, Net.*We recognized a loss on disposal of assets of $20 million in 2024 compared to a loss on disposal of assets of $21 million in 2023. The loss in 2024 was primarily related to the acquisition of a construction permit to build television station KCBU in exchange for the divestiture of television stations KCWY and KGWN in which we recognized a loss of $14 million. The loss in 2023 was primarily related to the sale of television station KNIN, in which we recognized a loss of $14 million in 2023.
Previous wording
*Impairment of Investments.*During 2023 and 2022, we wrote down the value of certain investments to their estimated net realizable values. The total impairment charges were $29 million and $18 million in 2023 and 2022, respectively.
Current wording
*Impairment of Investments.*During 2024 and 2023, we wrote down the value of certain investments to their estimated net realizable values. The total impairment charges were $25 million and $29 million in 2024 and 2023, respectively.
Previous wording
*Income Tax Expense.*Our effective income tax rate decreased to a net provision of 7% for 2023 from 26% for 2022. Our effective income tax rates differed from the statutory rate due to the following items:
Current wording
*Income Tax Expense.*Our effective income tax rate increased to a net provision of 24% for 2024 from 7% for 2023. Our effective income tax rates differed from the statutory rate due to the following items:
Previous wording
We file a consolidated federal income tax return and such state or local tax returns as are required based on our current forecasts. We estimate that these income tax payments, before deducting refunds, will be within a range of $190 million to $210 million in 2024.
Current wording
We file a consolidated federal income tax return and such state or local tax returns as are required based on our current forecasts. We estimate that these income tax payments, before deducting refunds, will be within a range of $80 million to $100 million in 2025.
Previous wording
Our primary sources of liquidity are cash on hand, cash flows from operations and borrowing capacity under Revolving Credit Facility.
Current wording
General. Our primary sources of liquidity are cash on hand, cash flows from operations and borrowing capacity under our Revolving Credit Facility.
Previous wording
*General.*The following tables present data that we believe is helpful in evaluating our liquidity and capital resources (dollars in millions):
Current wording
The following tables present data that we believe is helpful in evaluating our liquidity and capital resources (dollars in millions):
Previous wording
Net cash provided by operating activities decreased $181 million to $648 million in 2023 compared to net cash provided by operating activities of $829 million in 2022. The decrease in cash provided by operating activities was primarily due to a decrease in net income of $531 million offset, in part, by an increase in cash provided from changes in working capital of $328 million and an increase in non-cash charges of $22 million. The change in working capital resulted primarily from the sale of accounts receivable under our accounts receivable securitization facility.
Current wording
Net cash provided by operating activities increased $103 million to $751 million in 2024 compared to net cash provided by operating activities of $648 million in 2023. The increase in cash provided by operating activities was primarily due to an increase in net income of $451 million; offset, in part, by a $144 million decrease in cash provided by changes in working capital; and a decrease in net non-cash charges of $204 million.
Previous wording
Net cash used in investing activities decreased $212 million to $291 million for 2023 compared to $503 million for 2022. The net decrease in the amount used was primarily due to; a reduction in cash used for the purchase of property and equipment of $88 million, an increase in cash received from both the sale of a television station, and from a quasi-governmental authority related to infrastructure components of construction on the Assembly Atlanta project, of $74 million; and a reduction of cash used to acquire businesses and broadcast licenses of $52 million.
Current wording
Net cash used in investing activities decreased $263 million to $28 million for 2024 compared to $291 million for 2023. The net decrease in the amount used was primarily due to a decrease in cash used for purchases of property and equipment and an increase in proceeds received from the sale of investments and other assets.
Previous wording
Net cash used in financing activities decreased $57 million to $397 million in 2023 compared to net cash used of $454 million in 2022. During 2023 and 2022, we used $52 million of cash to pay dividends to holders of our preferred stock and $30 million to pay dividends to holders of our common stock. During 2023 and 2022, we used a net amount of $310 million and $315 million, respectively, for pre-payments and required principal reductions of our long-term debt. We did not repurchase any shares of our common stock in 2023, but in 2022, we used $50 million to repurchase shares of our common stock on the open market.
Current wording
Net cash used in financing activities increased $212 million to $609 million in 2024 compared to net cash used in financing activities of $397 million in 2023. During 2024 and 2023, we used $52 million of cash to pay dividends to holders of our preferred stock and $32 million and $30 million, respectively, to pay dividends to holders of our common stock. During 2024 and 2023, we used a net amount of $474 million and $310 million, respectively, for principal payments net of borrowings on our long-term debt.
Previous wording
We sponsor and contribute to defined benefit and defined contribution retirement plans:
Current wording
We sponsor and contribute to defined benefit and defined contribution retirement plans. Effective on January 1, 2025, these plans were:
Previous wording
Our funding policy for the Gray Pension Plan is consistent with the funding requirements of existing federal laws and regulations under the Employee Retirement Income Security Act of 1974. A discount rate is selected annually to measure the present value of the benefit obligations. In determining the selection of a discount rate, we estimated the timing and amounts of expected future benefit payments and applied a yield curve developed to reflect yields available on high-quality bonds. The yield curve is based on an externally published index specifically designed to meet the criteria of United States Generally Accepted Accounting Principles (“U.S. GAAP”). The discount rate selected for determining benefit obligations as of December 31, 2023, was 4.79%, which reflects the results of this yield curve analysis. The discount rate used for determining benefit obligations as of December 31, 2022 was 4.99%. Our assumptions regarding expected return on plan assets reflects asset allocations, the investment strategy and the views of investment managers, as well as historical experience. In 2023, we used an assumed rate of return of 6.25% for our assets invested in the Gray Pension Plan. The estimated asset returns for this plan, calculated on a mean market value assuming mid-year contributions and benefit payments, were a gain of 13.7% for the year ended December 31, 2023, and a loss of 12.0% for the year ended December 31, 2022. Other significant assumptions relate to inflation, retirement and mortality rates. Our inflation assumption is based on an evaluation of external market indicators. Retirement rates are based on actual plan experience and mortality rates are based on the Pri-2012 total mortality table and the MP-2021 projection scale published by the Society of Actuaries.
Current wording
Our funding policy for the Gray Pension Plan is consistent with the funding requirements of existing federal laws and regulations under the Employee Retirement Income Security Act of 1974. A discount rate is selected annually to measure the present value of the benefit obligations. In determining the selection of a discount rate, we estimated the timing and amounts of expected future benefit payments and applied a yield curve developed to reflect yields available on high-quality bonds. The yield curve is based on an externally published index specifically designed to meet the criteria of United States Generally Accepted Accounting Principles (“U.S. GAAP”). The discount rate selected for determining benefit obligations as of December 31, 2024, was 5.48%, which reflects the results of this yield curve analysis. The discount rate used for determining benefit obligations as of December 31, 2023 was 4.79%. Our assumptions regarding expected return on plan assets reflects asset allocations, the investment strategy and the views of investment managers, as well as historical experience. In 2024, we used an assumed rate of return of 6.25% for our assets invested in the Gray Pension Plan. The estimated asset returns for this plan, calculated on a mean market value assuming mid-year contributions and benefit payments, were a gain of 0.7% for the year ended December 31, 2024, and a gain of 13.7% for the year ended December 31, 2023. Other significant assumptions relate to inflation, retirement and mortality rates. Our inflation assumption is based on an evaluation of external market indicators. Retirement rates are based on actual plan experience and mortality rates are based on the Pri-2012 total mortality table and the MP-2021 projection scale published by the Society of Actuaries.
Previous wording
During each of the years ended December 31, 2023 and 2022, we contributed $4 million to the Gray Pension Plan, and we anticipate making a contribution of $4 million to the Gray Pension Plan in 2024. The use of significantly different assumptions, or if actual experienced results differ significantly from those assumed, could result in our funding obligations being materially different.
Current wording
During the year ended December 31, 2024, we determined that no contribution to the Gray Pension Plan was required. During the year ended December 31, 2023, we contributed $4 million to the Gray Pension Plan. Currently we do not expect that a contribution to the Gray Pension Plan will be needed in 2025. The use of significantly different assumptions, or if actual experienced results differ significantly from those assumed, could result in our funding obligations being materially different.
Previous wording
The Gray 401(k) Plan is a defined contribution plan intended to meet the requirements of section 401(k) of the Internal Revenue Code. Employer contributions under the Gray 401(k) Plan include matching cash contributions at a rate of 100% of the first 1% of each employee’s salary deferral, and 50% of the next 5% of each employee’s salary deferral. In addition, the Company, at its discretion, may make an additional profit-sharing contribution, based on annual Company performance, to those employees who meet certain criteria. For the years ended December 31, 2023 and 2022, our matching contributions to our Capital Accumulation Plan were approximately $26 million and $17 million, respectively. For the years ended December 31, 2023 and 2022, we accrued contributions of approximately $10 million and $9 million respectively, as discretionary profit-sharing contributions, each in the form of our common stock.
Current wording
The Gray 401(k) Plan is a defined contribution plan intended to meet the requirements of section 401(k) of the Internal Revenue Code. During 2024 and 2023, employer contributions under the Gray 401(k) Plan include matching cash contributions at a rate of 100% of the first 1% of each employee’s salary deferral, and 50% of the next 5% of each employee’s salary deferral. In addition, the Company, at its discretion, may make an additional profit-sharing contribution, based on annual Company performance, to those employees who meet certain criteria. For the years ended December 31, 2024 and 2023, our matching contributions to our Capital Accumulation Plan were approximately $28 million and $26 million, respectively. An additional profit-sharing contribution was not approved for 2024. As of and for the year ended December 31, 2023, an additional profit-sharing contribution of $10 million was approved and accrued as a liability. This liability was settled in the first quarter of 2024 by the issuance of Gray common stock to the participants of the Gray 401(k) Plan.
Previous wording
In connection with the Meredith Transaction, in 2021, we assumed a defined benefit pension plan covering certain legacy Meredith bargaining class employees. As of December 31, 2023 and 2022, the Meredith Plan had combined plan assets of $16 million and $14 million, respectively, and combined projected benefit obligations of $11 million, in each year. A net asset of $5 million and $3 million for this plan are recorded in our financial statements as of December 31, 2023 and 2022, respectively.
Current wording
In connection with the Meredith Transaction, in 2021, we assumed a defined benefit pension plan covering certain legacy Meredith bargaining class employees. As of December 31, 2024 and 2023, the Meredith Plan had combined plan assets of $22 million and $16 million, respectively, and combined projected benefit obligations of $18 million and $11 million, respectively. A net asset of $4 million and $5 million for this plan are recorded in our financial statements as of December 31, 2024 and 2023, respectively.
Previous wording
We currently expect that our routine capital expenditures will range between approximately $115 million to $120 million during 2024 for broadcasting, production company and corporate purposes. We currently expect capital expenditures of approximately $21 million, net of $31 million of certain incentive payments, related to the Assembly Atlanta project. We can give no assurances of the actual proceeds to be received in the future from incentive payments, nor the timing of any such proceeds.
Current wording
We currently expect that our capital expenditures will range between approximately $85 million to $90 million during 2025, which includes capital expenditures at our Assembly Atlanta project. We incurred costs to build public infrastructure within the Assembly Atlanta project. Pursuant to our Purchase and Sale Agreement with the Doraville Community Improvement District (the “CID”), we receive cash reimbursements for the transfer of specific infrastructure projects to the CID and for other construction costs previously incurred. Consistent with previous practice, we anticipate transferring certain public infrastructure at Assembly Atlanta to the CID for which we anticipate receiving proceeds during 2025. We expect reimbursements of approximately $25 million in 2025 for work completed to date, and that our capital expenditures in 2025 will be less than the reimbursements we expect to receive. We can give no assurances of the actual proceeds to be received in the future from the CID, nor the timing of any such proceeds.
Previous wording
During 2023, we have experienced moderate inflation of our operating expenses and increases in interest rates on amounts outstanding under our Senior Credit Facility. There can be no assurance that further increases in the rate of inflation or interest rates in the future would not have an adverse effect on operating results.
Current wording
During 2024, we have experienced moderate inflation of our operating expenses and increases in interest rates on amounts outstanding under our Senior Credit Agreement. There can be no assurance that further increases in the rate of inflation or interest rates in the future would not have an adverse effect on operating results.
Previous wording
In the performance of our annual broadcast license and reporting unit impairment assessments, we have the option of performing a qualitative assessment to determine if it is more likely than not that the respective asset has been impaired. In 2023, we performed a qualitative assessment for 59 of our broadcast licenses and three of our reporting units. In 2022, we performed a qualitative assessment for 57 of our broadcast licenses and one of our reporting units.
Current wording
In the performance of our annual broadcast license and reporting unit impairment assessments, we have the option of performing a qualitative assessment to determine if it is more likely than not that the respective asset has been impaired. In 2024, we performed a qualitative assessment for 56 of our broadcast licenses and three of our reporting units. In 2023, we performed a qualitative assessment for 59 of our broadcast licenses and one of our reporting units.
Previous wording
For our annual broadcast licenses impairment test in 2023, we concluded that it was more likely than not that all of our broadcast licenses that were evaluated were not impaired based upon our qualitative assessments. We elected to perform a quantitative assessment for our remaining broadcast licenses and concluded that their fair values exceeded their carrying values. To estimate the fair value of our broadcast licenses, we utilize a discounted cash flow model assuming an initial hypothetical start-up operation maturing into an average performing station in a specific television market and giving consideration to other relevant factors such as the technical qualities of the broadcast license and the number of competing broadcast licenses within that market.
Current wording
For our annual broadcast licenses impairment test in 2024, we concluded that it was more likely than not that all of our broadcast licenses that were evaluated were not impaired based upon our qualitative assessments. We elected to perform a quantitative assessment for our remaining broadcast licenses and concluded that their fair values exceeded their carrying values. To estimate the fair value of our broadcast licenses, we considered assumptions related to historical market and station growth trends, third party market specific industry data, the anticipated performance of the stations and discount rates. Our valuation technique included theoretical assumptions of the costs that would be incurred to construct a station when the only owned asset is the broadcast license and theoretical assumptions for the associated revenues, operating margins and capital expenditures expected to be incurred in the start-up years. We also consider other relevant factors such as the technical qualities of the broadcast license and the number of competing broadcast licenses within that market.
Previous wording
As of December 31, 2023 and 2022, the recorded value of our broadcast licenses was $5.3 billion at each date. As of December 31, 2023 and 2022, the recorded value of our goodwill was $2.6 billion and $2.7 billion, respectively. See Note 13 “Goodwill and Intangible Assets” of our audited consolidated financial statements included elsewhere herein, for the results of our annual impairment tests for the years ended December 31, 2023, 2022 and 2021.
Current wording
At December 31, 2024 and 2023, the recorded value of our broadcast licenses was $5.3 billion and the recorded value of our goodwill was $2.6 billion, at each date. See Note 13 “Goodwill and Intangible Assets” of our audited consolidated financial statements included elsewhere herein, for the results of our annual impairment tests for the years ended December 31, 2024, 2023 and 2022.
Previous wording
The methodology we used to value our stations was based on our evaluation of the broadcast licenses acquired and the characteristics of the markets in which they operated. Given our assumptions and the specific attributes of the stations we acquired from 2002 through December 31, 2023, we generally ascribe no incremental value to the incumbent network affiliation relationship in each market beyond the cost of negotiating a new agreement with another network and the value of any terms of the affiliation agreement that were more favorable or unfavorable than those generally prevailing in the market. Due to certain characteristics of a small number of the stations acquired in 2022, we ascribed approximately $14 million million of the value of those transactions to network affiliations, respectively.
Current wording
The methodology we used to value our stations was based on our evaluation of the broadcast licenses acquired and the characteristics of the markets in which they operated. Given our assumptions and the specific attributes of the stations we acquired from 2002 through December 31, 2024, we generally ascribe no incremental value to the incumbent network affiliation relationship in each market beyond the cost of negotiating a new agreement with another network and the value of any terms of the affiliation agreement that were more favorable or unfavorable than those generally prevailing in the market. Due to certain characteristics of a small number of the stations acquired in 2023, we ascribed approximately $14 million of the value of those transactions to network affiliations.