Gannett Co Inc
For the period ended Dec 31, 2024. Filed Feb 20, 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 20, 2025
TDAY$6.57+7.4%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 2024-02-22.
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Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-20.
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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.
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A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (363)
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OPERATIONS
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journalism, local content, and digital experiences to audiences and businesses. We deliver high-quality, trusted content with a
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focusing on audience growth and engagement while diversifying revenue streams. Our digital marketing solutions brand,
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LocaliQ, supports small and medium-sized businesses ("SMBs") with innovative digital marketing products and solutions. Our
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mission remains to inspire, inform, and connect communities while driving sustainable growth for our customers, advertisers,
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partners, and shareholders.
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declining print audience. We are focused on growing a digitally-oriented audience across multiple platforms and
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revenue streams.
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spending.
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•We rely on third-party platforms from large technology companies, particularly search engines, social media
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platforms, and emerging technologies. These platforms exert significant control over the visibility and ranking of our
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content, and their actions can adversely impact traffic, engagement, and revenues. Additionally, these companies can
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influence both the type of media we acquire and the associated costs. We continue to adapt by diversifying our digital
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strategies and optimizing content distribution to mitigate these impacts.
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•The application of artificial intelligence ("AI") and the rapid rate of change within the AI ecosystem is increasing the
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pace of change in the media sector.
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future results:
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Asset impairments
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For theyear ended December 31, 2024, we recorded impairment charges of$46.6 million, of which approximately
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the years ended December 31,2023 and 2022, we recorded impairment charges of$1.4 million and$1.1 million related to our
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plan to monetize non-strategic assets.
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For theyear ended December 31, 2024, we recognized anet loss on the sale of assets of$1.1 million, primarily related to
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net losses of$1.7 million at the Domestic Gannett Media segment and$0.2 million at our Corporate and other category,
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partially offset by a net gain of$0.9 million at the Newsquest segment, as part of our plan to monetize non-strategic assets.
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For theyear ended December 31, 2023, we recognized anet gain on the sale of assets of$40.1 million, primarily related to
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property.
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For theyear ended December 31, 2022, we recognized anet gain on the sale of assets of$6.9 million, primarily related to a
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our plan to monetize non-strategic assets.
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For theyear ended December 31, 2024, we incurred Integration and reorganization costs of $66.2 million. Of the total costs
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incurred,$15.1 million were related to severance activities and$51.0 million were related to other reorganization-related costs,
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including$24.5 million related to withdrawal liabilities, generally paid over a period of approximately 20 years, which were
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expensed as a result of ceasing contributions to multiemployer pension plans, and$9.7 million expensed as of the cease-use
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date related to certain licensed content, as well as costs associated with facility consolidation and systems implementation.
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For theyear ended December 31, 2023, we incurred Integration and reorganization costs of$24.5 million. Of the total costs
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For theyear ended December 31, 2022, we incurred Integration and reorganization costs of$88.0 million. Of the total costs
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international operations. For example, our international revenues are favorably impacted as the U.S. dollar weakens relative to
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other foreign currencies, and unfavorably impacted as the U.S. dollar strengthens relative to other foreign currencies. Foreign
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marketing solutions company. Our strategy is rooted in three operating pillars: (i) expanding our reach and engagement, (ii)
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diversifying our digital revenues, and (iii) strengthening our capital structure, all supported by what we believe is a stable and
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increasingly agile foundation which we continue to optimize as the business and industry evolves. We believe our strategy will
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Removed paragraphs (88)
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•Inflationary prices across a number of categories such as labor, fuel, delivery costs, newsprint, ink, and printing plates have had and are expected to continue to have a negative impact on our overall cost structure year-over-year. In the short term, we believe the impact of inflationary pressure peaked in 2022.
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•Data privacy standards continue to evolve and implementation of standards may result in incremental costs. Privacy standards, such as third-party cookie deprecation, are anticipated to impact the advertising industry more significantly in 2024. We utilize first-party data to assist our customer's advertising needs but an industry-wide solution to address impacts to programmatic advertising has not yet been developed.
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Recent Developments
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Debt repurchase
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In addition, during the fourth quarter of 2023, we repaid approximately $9.9 million of our Senior Secured Term Loan, including quarterly amortization payments. As a result of the repayment related to our Senior Secured Term Loan, we recognized a net loss on the early extinguishment of debt of approximately $0.1 million during the fourth quarter of 2023, which included the write-off of unamortized original issue discount and deferred financing costs.
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Corporate office relocation
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For the year ended December 31, 2021, we recognized a net loss on the sale of assets of $17.2 million, primarily related to a net loss of $27.4 million at the Domestic Gannett Media segment, partially offset by a net gain of $9.9 million at the Newsquest segment, mainly driven by the sales of production facilities as part of our plan to monetize non-core assets.
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For the year ended December 31, 2021, we incurred Integration and reorganization costs of $49.3 million. Of the total costs incurred, $16.5 million were related to severance activities and $32.8 million were related to other costs, including costs for consolidating operations, such as costs associated with systems integrations.
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We intend to create stockholder value through a variety of methods, including organic growth driven by our consumer and business-to-business strategies, as well as through paying down debt to strengthen our capital structure.
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Create a stable foundation for growth
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Expand our reach
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Building on our environmental, social and governance focus to foster culture and community both internally and externally
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These challenging conditions, especially higher inflation and interest rates, have negatively impacted the consumer and resulted in increased price sensitivity from our print and paid digital-only subscribers. Consumer purchases of discretionary items, including our products and services, generally decline during periods of economic uncertainty, when disposable income is reduced or when there is a reduction in consumer confidence. SMBs are facing a more complex marketing environment and need to create digital presence to capture audiences online. Advertisers are increasingly looking for more effective ways to analyze their return on marketing investments and are seeking solutions that offer greater attribution. We believe we offer a broad suite of digital marketing services products that offer a single, unified solution to meet their digital marketing needs.
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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. During the year ended December 31, 2023, we did not experience a material financial impact from the Inflation Reduction Act. We do not anticipate a material financial impact from the Inflation Reduction Act during 2024.
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We are subject to income taxes and various other taxes in the U.S. and in many foreign jurisdictions; therefore, changes in both domestic and international tax laws or regulations have affected and may affect our effective tax rate, results of operations, and cash flows. The Organization for Economic Co-operation and Development (the "OECD")/G20 Inclusive Framework on Base Erosion and Profit Shifting has agreed on a two-pillar approach to address tax challenges arising from the digitalization of the global economy by (i) allocating profits to market jurisdictions ("Pillar One") and (ii) ensuring multinational enterprises pay a minimum level of tax regardless of where the headquarters are located or the jurisdictions in which the company operates ("Pillar Two"). Pillar One targets multinational groups with global revenue exceeding €20 billion and a profit-to-revenue ratio of more than 10%. Companies subject to Pillar One will be required to allocate profits and pay taxes to market jurisdictions. Based on the current proposed revenue and profit thresholds, we do not expect to be subject to tax changes associated with Pillar One. Pillar Two focuses on global profit allocation and a global minimum tax rate. In December 2022, the European Union ("EU") Member States formally adopted the EU's Pillar Two Directive, which generally provides for a minimum effective tax rate of 15%, as established by the OECD Pillar Two Framework that was supported by over 130 countries worldwide. The EU Pillar Two Directive became effective on January 1, 2024.
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The U.K. has enacted legislation to implement the OECD's Pillar Two rules with the passing of Finance (No.2) Act 2023. The legislation introduces a global minimum effective tax rate of 15% by implementing a domestic top-up tax and a multinational top-up tax for U.K. multinational corporations effective January 1, 2024. Other countries are also actively considering changes to their tax laws to adopt certain parts of the OECD's proposals. We do not expect that Pillar Two will have a material impact on the Consolidated financial statements.
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Our revenues are subject to moderate seasonality, primarily due to fluctuations in advertising volumes. Advertising and marketing services revenues for our Domestic Gannett Media segment are typically highest in the fourth quarter, primarily due to fluctuations in advertising volumes tied to the holidays, regional weather, and levels of activity in our various markets, some of which have a high degree of seasonal residents and tourists. Revenues in our DMS segment experience moderate seasonality in the first quarter due to fluctuations in the seasonal needs of our advertising customers. The volume of advertising sales in any period is also impacted by other external factors such as competitors' pricing, advertisers' decisions to increase or decrease their advertising expenditures in response to anticipated consumer demand, and general economic conditions. Uncertain economic conditions continued to adversely impact our advertising revenues during 2023, and the occurrence of these factors has resulted in a reduction in demand for our print and digital advertising, reduced the rates for our advertising, and caused marketers to shift, reduce or stop spend. Refer to "Macroeconomic Environment" above for further discussion.
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Environmental, Social and Governance Initiatives
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The well-being of our employees is of paramount importance to us and we are committed to maintaining a corporate culture that conducts business in a responsible and ethical manner that includes promoting, protecting and supporting human rights across our operations and throughout our entire organization, which is why we have adopted a company-wide Human Rights Policy. This policy expands upon an existing policy enacted by our U.K. operations. Our Human Rights Policy covers areas such as our commitment to diversity and inclusion, a safe and healthy workplace, our communities and stakeholders, and freedom of association and collective bargaining, which helps ensure our employees' right to form and choose whether to join a labor union without fear of reprisal, intimidation, or harassment. The Human Rights Policy also reflects our commitment to bargaining in good faith with chosen representatives of such groups in accordance with applicable laws.
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(b) Other revenues included Other Digital revenues, including digital syndication, affiliate, production and licensing revenues of $84.2 million, $80.7 million and $68.6 million for the years ended December 31, 2023, 2022 and 2021, respectively.
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Circulation revenues are generated by the Domestic Gannett Media and Newsquest segments, and are derived from home delivery, digital distribution and single copy sales of our publications.
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•Integration and reorganization costs include severance charges and other costs, including those for the purpose of consolidating our operations (i.e., facility consolidation expenses and integration-related costs);
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Non-operating (income) expense
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Loss on convertible notes derivative: For the years ended December 31, 2023 and 2022, we had no Loss on convertible notes derivative. For the year ended December 31, 2021, Loss on convertible notes derivative was $126.6 million, reflecting the increase in the fair value of the derivative liability as a result of the increase in our stock price.
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Provision for income taxes
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Our effective tax rate for the year ended December 31, 2021 was not meaningful given the income tax provision associated with a loss before income taxes. The tax provision was primarily impacted by the derivative revaluation, which is nondeductible for federal tax purposes, the creation of valuation allowances on non-deductible interest expense carryforwards, and deemed income from global intangible low-taxed income inclusion, offset by the change in the deferred tax rate from 19% to 25% in the U.K. and the income tax impact of Paycheck Protection Program ("PPP") loan forgiveness.
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A summary of our Domestic Gannett Media segment comparing the year ended December 31, 2023 to the year ended December 31, 2022 is presented below:
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(a) Other revenues included Other Digital revenues, including digital content syndication and affiliate revenues of $67.5 million and $65.8 million for the years ended December 31, 2023 and 2022, respectively.
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For the year ended December 31, 2023, Operating costs decreased $181.9 million compared to 2022. The following table provides the breakout of the decrease in Operating costs:
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For the year ended December 31, 2023, Selling, general and administrative expenses decreased by $90.6 million compared to 2022. The following table provides the breakout of the decrease in Selling, general and administrative expenses:
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A summary of our Domestic Gannett Media segment comparing the year ended December 31, 2022 to the year ended December 31, 2021 is presented below:
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Operating revenues
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The following table provides the breakout of Operating revenues by category:
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(a)Other revenues included Other Digital revenues, including digital content syndication and affiliate revenues of $65.8 million and $57.4 million for the years ended December 31, 2022 and 2021, respectively.
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For the year ended December 31, 2022, Digital media revenues decreased compared to 2021, driven by changes in monetization with our sports affiliates as well as lower page views related to increased subscriber-only content, secular trends in news consumption and lower overall digital advertising spend. In addition, during the year ended December 31, 2022, we experienced a reduction in digital advertising demand as a result of a more challenging macroeconomic environment. For the year ended December 31, 2022, Digital marketing services revenues increased compared to 2021, due to an increase in client counts as well as an increase in rates. For the year ended December 31, 2022, Digital classified revenues increased compared to 2021, due to higher client spend, primarily due to increased spend on automotive advertisements, partially offset by lower spend on obituary and employment notifications.
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For the year ended December 31, 2022, Print circulation revenues decreased compared to 2021, due to a decline in home delivery sales, mainly driven by a reduction in the volume of subscribers, partially offset by an increase in rates, as well as a decline in single copy sales reflecting the overall secular trends impacting the industry and increasing sensitivity from customers related to price increases and product changes. In addition, during the year ended December 31, 2022, and specifically beginning in the second quarter of 2022, the decline in print circulation revenues accelerated as compared to the same period in the prior year as our audience increasingly moved to digital platforms, and as a result of consumer price sensitivity. For the year ended December 31, 2022, Digital-only subscription revenues increased compared to 2021, driven by an increase of 24.6% in paid digital-only subscriptions, including those subscribers on introductory subscription offers, to approximately 2 million as of December 31, 2022, partially offset by a decline in Digital-only ARPU. Refer to "Key
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For the year ended December 31, 2022, Other revenues increased compared to 2021, primarily due to commercial print growth in local markets, an increase in digital content syndication volume and other digital revenues, and an increase in event revenues (though not to pre-pandemic levels) as we hosted more in-person events with higher attendance as compared to the same period in the prior year.
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For the year ended December 31, 2022, Operating costs decreased $77.5 million compared to 2021. The following table provides the breakout of the decrease in Operating costs:
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For the year ended December 31, 2022, Newsprint and ink costs increased compared to 2021, primarily due to an increase in newsprint prices of $21.8 million driven by inflationary pressures and supply chain issues impacting the industry, as well as growth in our commercial print business, partially offset by the decline in volume of home delivery and single copy sales as well as reduction of print offerings.
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For the year ended December 31, 2022, Distribution costs decreased compared to 2021, primarily due to a decrease of $36.1 million associated with lower home delivery and single copy revenues and $11.7 million of lower postage costs associated with lower volumes. Included in the decline in Distribution costs was the absence in 2022 of expenses of $28.0 million associated with both businesses divested and non-core products which were sunset in 2022 and 2021.
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
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We are a diversified media company with expansive reach at the national and local level dedicated to empowering and enriching communities. We seek to inspire, inform, and connect audiences as a sustainable, growth focused media and digital marketing solutions company. We endeavor to deliver essential content, marketing solutions, and experiences for curated audiences, advertisers, consumers, and stakeholders by leveraging our diverse teams and suite of products to enrich the local communities and businesses we serve.
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We are a diversified media company with expansive reach at the national and local level dedicated to empowering and
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Our current portfolio of trusted media brands includes the USA TODAY NETWORK, comprised of the national publication, USA TODAY, and local media organizations in the United States (the "U.S."), and Newsquest, a wholly-owned subsidiary operating in the United Kingdom (the "U.K."). Our digital marketing solutions brand, LocaliQ, uses innovation and software to enable small and medium-sized businesses ("SMBs") to grow, and USA TODAY NETWORK Ventures, our events division, creates impactful consumer engagements, promotions, and races.
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marketing solutions company. Through our trusted brands, including the USA TODAY NETWORK, comprised of the national
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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. We have 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 digital marketing solutions product suite. Our strategy prioritizes maximizing the monetization of our audience through the growth of increasingly diverse and highly recurring digital businesses. We expect the execution of this strategy to enable us to continue our evolution to a predominantly digital media company. We deliver value to our customers, advertisers, partners and shareholders with essential content, joyful experiences, and relevant digital solutions.
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commitment to balanced, unbiased journalism, where and when consumers want to engage. We prioritize a digital-first strategy,
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We report in three segments: Domestic Gannett Media, Newsquest 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, marketing and technology, as well as other general business costs. Effective with the fourth quarter of 2023, we are reporting financial information for our Newsquest business in a separate segment. Previously, the financial information for this segment was aggregated with Domestic Gannett Media and, together, formed the Gannett Media reportable segment. As a result, we have revised our historical disclosures to reflect the new Domestic Gannett Media and Newsquest reportable segments for all years presented. A full description of our reportable segments is included in Note 14 — Segment reporting in the notes to the Consolidated financial statements.
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We report inthree segments: Domestic Gannett Media, Newsquest and Digital Marketing Solutions ("DMS"). We also
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•Print advertising and circulation revenues continue to decline as our audience increasingly moves to digital platforms. We seek to optimize our print operations to efficiently manage for the declining print audience. We are focused on converting a growing digitally-focused audience into paid digital-only subscribers to our publications.
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•Print advertising and Print circulation revenues have and are expected to continue to decline as our audience
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•Our revenues and results of operations have been and can be significantly influenced by general macroeconomic conditions, including, but not limited to, interest rates, inflation, housing demand, employment levels, and consumer confidence. We believe that these factors are contributing to uncertainty in SMBs, which is resulting in lower levels of advertising performance and reduced spending in categories such as home services.
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•Our revenues and results of operations continue to be influenced by general macroeconomic conditions, including, but
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The following items affect period-over-period comparisons and will continue to affect period-over-period comparisons for future results:
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The following items affect period-over-period comparisons and will continue to affect period-over-period comparisons for
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On February 15, 2024, we decided we will relocate our corporate headquarters from McLean, Virginia to our existing leased office space in New York, New York effective March 31, 2024. We will exit, cease use and continue to seek subleases for our leased facility in McLean. As a result of the headquarters relocation, we expect to record impairment charges of approximately $45.0 million during the three months ended March 31, 2024 related to the McLean operating lease right-of-use asset and the associated leasehold improvements.
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$46.0 million related to the McLean, Virginia operating lease right-of-use asset and the associated leasehold improvements. For
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(Gain) loss on sale or disposal of assets, net
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Loss (gain) on sale or disposal of assets, net
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For the year ended December 31, 2023, we recognized a net gain on the sale of assets of $40.1 million, primarily related to net gains of $38.9 million at the Domestic Gannett Media segment due to the sales of production facilities as part of our plan to monetize non-core assets, and a gain of $1.4 million at our Corporate and other category related to the sale of intellectual property.
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anet gain of$38.9 million at the Domestic Gannett Media segment due to the sales of production facilities as part of our plan to
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For the year ended December 31, 2022, we recognized a net gain on the sale of assets of $6.9 million, primarily related to net gains of $6.7 million at the Domestic Gannett Media segment, mainly driven by the sales of production facilities as part of our plan to monetize non-core assets.
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net gain of$6.7 million at the Domestic Gannett Media segment, mainly driven by the sales of production facilities as part of
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For the year ended December 31, 2023, we incurred Integration and reorganization costs of $24.5 million. Of the total costs incurred, $18.5 million were related to severance activities and $6.0 million were related to other costs, including costs for consolidating operations, primarily related to costs associated with systems implementation and the outsourcing of corporate functions, partially offset by the reversal of withdrawal liabilities related to multiemployer pension plans of $6.4 million based on settlement of the withdrawal liabilities.
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incurred,$18.5 million were related to severance activities and$6.0 million were related to other costs, including costs for
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For the year ended December 31, 2022, we incurred Integration and reorganization costs of $88.0 million. Of the total costs incurred, $57.6 million were related to severance activities and $30.4 million were related to other costs, including a withdrawal liability related to multiemployer pension plans of $8.6 million, which was expensed as a result of ceasing contributions, costs for consolidating operations, primarily related to systems implementation and the outsourcing of corporate functions, and facilities consolidation expenses, primarily associated with exiting a lease.
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incurred,$57.6 million were related to severance activities and$30.4 million were related to other costs, including a withdrawal
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Our U.K. media operations are conducted through our Newsquest subsidiary. In addition, we have foreign operations in regions such as Canada, Australia, New Zealand and India. Earnings from operations in foreign regions are translated into U.S. dollars at average exchange rates prevailing during the period, and assets and liabilities are translated at exchange rates in effect at the balance sheet date. Currency translation fluctuations may impact revenue, expense, and operating income results for our international operations. Foreign currency headwinds have increased significantly as the U.S. dollar strengthened in relation to many foreign currencies, including the U.K. pound sterling. Foreign currency exchange rate fluctuations negatively impacted our revenues and profitability during the year ended December 31, 2023, and may continue to negatively impact our financial results in the future.
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Our U.K. media operations are conducted through our Newsquest subsidiary. In addition, we have foreign operations in
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We are committed to inspiring, informing and connecting audiences as a sustainable, growth-focused media and digital marketing solutions company. We endeavor to deliver essential content, marketing solutions and experiences for curated audiences, advertisers, consumers, and stakeholders by leveraging our diverse teams and suite of products to enrich the local communities and businesses we serve. The execution of this strategy is expected to allow us to continue our evolution from a more traditional print media business to a sustainable, growth-focused media and digital marketing solutions company.
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We are committed to inspiring, informing and connecting audiences as a sustainable, growth-focused media and digital
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We continue to optimize and improve our foundation – completing systems consolidations and migrations, improving process workflows, and ensuring we have synergy across the organization to deliver the stabilization required to fuel our plan into the future. We also continue to invest in our people and in the skills needed to support our future aims and to retain our talent by remaining an attractive place to work.
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We continue to optimize and improve our infrastructure – through ongoing systems consolidations and migrations,
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Key to our ongoing growth is expanding our base – whether clients in our DMS segment or audience in our Domestic Gannett Media and Newsquest segments – and optimizing our revenue streams across this growing base. For both the Domestic Gannett Media and Newsquest segments, this includes content expansion, establishing a seamless print to digital continuum to introduce clients, readers, viewers, and listeners to a broader range of products we offer. For the DMS segment, expanding our client base and core revenue is anticipated to be supplemented by the development of a complementary software model.
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We believe that a key to our ongoing growth is expanding our base – including clients in our DMS segment and audience
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We expect to continue to expand the ways that we grow digital revenues through innovative partnerships and developing new products and services that meet the needs of consumers and businesses. Examples of this growth strategy include our intention to continue to expand partnerships that rely on our unique and large audience base and developing new DMS software solutions.
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We expect to continue to expand the ways that we grow digital revenues through creating a diverse portfolio of meaningful
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For the year ended December 31, 2023, Print circulation revenues decreased compared to 2022, due to a decline in home delivery as a result of a reduction in the volume of subscribers, partially offset by an increase in rates, as well as a decline in single copy due to a reduction in volume. In addition, the decrease in Print circulation revenues was due to the absence in 2023 of revenues of $6.8 million associated with non-core products which were sunset in 2023 and 2022. For the year ended December 31, 2023, Digital-only subscription revenues increased compared to 2022, due to an increase in Digital-only subscription average revenue per user ("Digital-only ARPU") of 7.8%, mainly due to product mix. Refer to "Key Performance Indicators" below for further discussion of Digital-only ARPU.
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Performance Indicators" below for further discussion of Core platform revenues.
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The U.S. and global economies and markets experienced increased volatility in 2023, and are expected to continue to experience volatility, due to factors, including higher inflation, increased interest rates, banking volatility, and other geopolitical events that are anticipated to continue in 2024. Uncertain economic conditions adversely impacted our advertising revenues, and the occurrence of these factors has resulted in a reduction in demand for our print and digital advertising, reduced the rates for our advertising, and caused marketers to shift, reduce or stop spend. The impact of these uncertain macroeconomic conditions has not changed substantially since the initial volatility that began in the second quarter of 2022.
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continue to have an adverse impact on our revenues, and the occurrence of these factors has resulted in a reduction in demand
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As a result of the macroeconomic volatility, we have experienced rising costs, including costs associated with labor, newsprint, delivery, ink, printing plates, fuel, and utilities. However, we believe that the inflationary pressures peaked in 2022 and we are beginning to realize and expect we may continue to realize lower prices related to newsprint costs. We are also exposed to potential increases in interest rates associated with our Senior Secured Term Loan, which as of December 31, 2023, accounted for approximately 31% of our outstanding debt, as well as fluctuations in foreign currency exchange rates, primarily related to our operations in the U.K. We expect continued uncertainty and volatility in the U.S. and global economies which will continue to impact our business.
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debt, as well as fluctuations in foreign currency exchange rates, primarily related to our operations in the U.K. We expect
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Adjusted EBITDA and Adjusted EBITDA margin are not alternatives to Net income (loss) attributable to Gannett and margin as calculated and presented in accordance with U.S. GAAP. As such, they should not be considered or relied upon as substitutes or alternatives for any such U.S. GAAP financial measures. We strongly urge you to review the reconciliation of Net income (loss) attributable to Gannett to Adjusted EBITDA and Adjusted EBITDA margin along with our Consolidated financial statements included elsewhere in this Annual Report on Form 10-K. We also strongly urge you not to rely on any single financial measure to evaluate our business. In addition, because Adjusted EBITDA and Adjusted EBITDA margin are not measures of financial performance under U.S. GAAP and are susceptible to varying calculations, the Adjusted EBITDA and Adjusted EBITDA margin measures as presented in this report may differ from and may not be comparable to similarly titled measures used by other companies.
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— Risk Factors" in this Annual Report on Form 10-K.
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We will continue our environmental, social and governance ("ESG") journey that is rooted in our strategic mission to empower our communities to thrive and putting our customers at the center of everything we do. We support that mission with clearly defined values that aim to influence not only what we do, but how we do it, with one of the core pillars focusing on our ongoing commitments to inclusion, diversity, and equity ("ID&E"). From our internal efforts around recruiting, development and retention, to our external efforts to provide high quality products and excellent customer service, we believe our strategic focus will benefit from our continued commitment to building upon our culture and community values.
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Environmental, Social and Governance ("ESG") Initiatives
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As a leading media organization, our longstanding corporate social responsibility position is driven by our deep commitment to our communities. We are dedicated to ensuring that we have mindful and ethical business practices that positively impact our world. In early 2023, we published our 2023 ESG Report detailing the progress we made on our U.N. Sustainable Development Goals ("U.N. SDGs") that include Reduced Inequalities, Climate Action, and Peace, Justice and Strong Institutions. The 2023 ESG Report included noteworthy highlights such as improving our workplace diversity, expanding our systems infrastructure to provide Scope 1 and 2 emissions for our entire global carbon footprint, and reducing the number of manufacturing facilities.
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As a leading media organization, our longstanding corporate social responsibility position is driven by our deep
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We are committed to ensuring our coverage is widely available, actively promoted across our media sites and marketed to our millions of registered users. In January 2024, we published our network-wide 2023 Journalism Impact Report, which highlighted what we believe are the most influential articles we produced in 2023 and covers topics such as coverage on ID&E, as well as climate change. We are committed to the ongoing publishing of an annual network-wide Journalism Impact Report, which surfaces the top stories we produced that led to action.
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We are committed to ensuring our coverage is widely available, actively promoted across our media sites and marketed to
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(a) Amounts are net of intersegment eliminations of $150.5 million, $143.5 million and $129.3 million for the years ended December 31, 2023, 2022 and 2021, respectively, which represent digital advertising marketing services revenues and expenses associated with products sold by sales teams in our Domestic Gannett Media and Newsquest segments but fulfilled by our DMS segment. When discussing segment results, these revenues and expenses are presented gross but are eliminated in consolidation.
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respectively, which represent digital marketing services revenues and expenses associated with products sold by sales teams in our Domestic Gannett
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Advertising and marketing services revenues are generated by the Domestic Gannett Media, Newsquest and DMS segments. At both the Domestic Gannett Media and Newsquest segments, Advertising and marketing services revenues are generated by the sale of local, national, and classified print advertising products, digital advertising offerings such as digital classified advertisements, digital media such as display advertisements run on our platforms as well as third-party sites, and digital marketing services delivered by our DMS segment. At the DMS segment, Advertising and marketing services revenues are generated 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.
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through multiple services, including search advertising, display advertising, search optimization, social media, website
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Other revenues are primarily generated by the Domestic Gannett Media and Newsquest segments. Other revenues generated by the Domestic Gannett Media segment are mainly derived from commercial printing, distribution arrangements, revenues from our events business, digital content syndication and affiliate revenues and third-party newsprint sales. Other revenues generated by the Newsquest segment are mainly derived from digital production revenues and commercial printing. To a lesser extent Other revenues generated at our Corporate and other category are mainly driven by sales of cloud-based products with expert guidance and support.
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and revenues from our events business.
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•Operating costs at the Domestic Gannett Media and Newsquest segments include labor, newsprint and delivery costs and at the DMS segment include the cost of online media acquired from third parties and costs to manage and operate our marketing solutions and technology infrastructure;
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costs and at the DMS segment include the cost of online media acquired from third parties and costs to manage and
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•Selling, general and administrative expenses include labor, payroll, outside services, benefits costs and bad debt expense;
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•Selling, general and administrative expenses include labor, payroll, outside services, benefits costs and bad debt
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In November 2023, we received a waiver from certain lenders of our five-year senior secured term loan facility in an original aggregate principal amount of $516.0 million (the "Senior Secured Term Loan") that reduced the scheduled quarterly amortization payments payable to those lenders by $12.0 million for the three months ended December 31, 2023, so long as such reduced amount was used to purchase a portion of our 6.00% first lien notes due November 1, 2026 (the "2026 Senior Notes") at a discount to par value. In November 2023, we entered into a privately negotiated agreement with certain holders of our $400 million aggregate principal amount of 2026 Senior Notes, and repurchased $14.0 million of principal of our outstanding 2026 Senior Notes at a discount to par value. As a result of this repurchase of our 2026 Senior Notes, we recognized a net gain on the early extinguishment of debt of approximately $1.4 million during the fourth quarter of 2023, which included the write-off of unamortized original issue discount and deferred financing costs.
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aggregate principal amount of 6.00% first lien notes due November 1, 2026 (the "2026 Senior Notes"). The Senior Secured
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Interest expense: For the year ended December 31, 2023, Interest expense was $111.8 million compared to $108.4 million for the year ended December 31, 2022. The increase in interest expense for the year ended December 31, 2023 compared to 2022 was primarily due to the impact of the increase in interest rates on our Senior Secured Term Loan, partially offset by a lower debt balance, mainly driven by quarterly amortization payments on our Senior Secured Term Loan and repurchases of our 2026 Senior Notes. For the year ended December 31, 2022, Interest expense was $108.4 million compared to $135.7 million for the year ended December 31, 2021. The decrease in interest expense for the year ended December 31, 2022 compared to 2021 was mainly due to a lower debt balance and the impact of lower interest rates on our outstanding fixed-rate debt, partially offset by an increase in interest rates on the Senior Secured Term Loan.
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Term Loan Facility and an increase in interest rates on the Senior Secured Term Loan.
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Gain on early extinguishment of debt: For the years ended December 31, 2023 and 2022, we recognized gains on the early extinguishment of debt of $4.5 million and $0.4 million, respectively. The increase in the Gain on the early extinguishment of debt for the year ended December 31, 2023 compared to 2022 was mainly due to refinancing activities related to our 2026 Senior Notes and Senior Secured Term Loan. For the year ended December 31, 2021, we incurred a loss on the early extinguishment of debt of $48.7 million. The decrease for the year ended December 31, 2022 compared to 2021 was mainly due to the absence in 2022 of the refinancing activities which occurred in 2021, including the refinancing of our five-year, senior-secured term loan facility in an aggregate principal amount of $1.045 billion (the "5-Year Term Loan") in the fourth quarter of 2021 and the payoff of our five-year, senior-secured 11.5% term loan facility with Apollo Capital Management, L.P., which was made in the first quarter of 2021. Refer to "Recent Developments – Debt repurchase" above for further discussion of our 2026 Senior Notes.
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Gain on early extinguishment of debt: For the years ended December 31,2024,2023 and 2022, we recognizednet gains on
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Non-operating pension income: For the year ended December 31, 2023, Non-operating pension income was $9.4 million compared to $59.0 million in 2022. The decrease in Non-operating pension income for the year ended December 31, 2023 compared to 2022 was primarily due to a decrease in the expected return on plan assets, mainly driven by a decrease in assets following the annuity contract entered into during 2022, related to the Gannett Retirement Plan (the "GR Plan"). For the year ended December 31, 2022, Non-operating pension income was $59.0 million compared to $95.4 million in 2021. The decrease in Non-operating pension income for the year ended December 31, 2022 compared to 2021 was primarily due to a decrease in the expected return on plan assets held by the GR Plan, mainly driven by a more conservative asset allocation, and to a lesser extent, the reduction to the GR Plan assets as a result of the pension annuity entered into during the third quarter of 2022.
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compared to 2022 was primarily due to a decrease in the expected return on plan assets, mainly driven by a decrease in assets
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Other non-operating income, net: Other non-operating income, net consisted of certain items that fall outside of our normal business operations. For the year ended December 31, 2023, we recorded Other non-operating income, net of $5.4 million compared to $5.7 million in 2022. For the year ended December 31, 2022, Other non-operating income, net, was $5.7 million compared to $18.7 million in 2021. The decrease in Other non-operating income, net for the year ended December 31, 2022 compared to 2021 was primarily due to the absence in 2022 of the reversal of an accrual related to a legal matter in 2021.
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Other non-operating income, net: Other non-operating income, net consisted of certain items that are outside of our normal
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The following table summarizes our pre-tax loss before income taxes and income tax accounts:
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The following table summarizes ourpre-tax net loss before income taxes and income tax accounts:
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Our effective tax rate for the year ended December 31, 2023 was not meaningful. The tax provision for 2023 was primarily impacted by the valuation allowances on non-deductible U.S. interest expense carryforwards, the global intangible low-taxed income inclusion from our U.K. operations, nondeductible compensation, and state and local tax expense, partially offset by the benefit from the pre-tax book loss.
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non-deductible U.S. interest expense carryforwards and global intangible low-taxed income inclusion. Refer to Note 8 — Debt
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Our effective tax rate for the year ended December 31, 2022 was negative 1.8%. The tax provision for 2022 was primarily impacted by the valuation allowances on non-deductible U.S. interest expense carryforwards, the global intangible low-taxed income inclusion, the release of uncertain tax positions in the U.S., and the reduction in the blended state tax rate, which were offset by the tax benefit of the pre-tax book loss.
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income inclusion, the release of uncertain tax positions in the U.S., and the reduction in the blended state tax rate, which were
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Net loss attributable to Gannett and diluted loss per share attributable to Gannett
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Net loss attributable to Gannett anddiluted loss per share attributable to Gannett
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enriching communities. We seek to inspire, inform, and connect audiences as a sustainable, growth focused media and digital
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publication, USA TODAY, and local media organizations, including our network of local properties, in the United States (the
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"U.S."), and Newsquest, a wholly-owned subsidiary operating in the United Kingdom (the "U.K."), we provide essential
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have a Corporate and other category that includes activities not directly attributable to a specific reportable segment and
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includes broad corporate functions, such as legal, human resources, accounting, analytics, finance, marketing and technology,
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as well as other general business costs. A full description of our reportable segments is included in Note 14 — Segment
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reporting in the notes to the Consolidated financial statements.
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increasingly moves to digital platforms. We seek to optimize our print operations to efficiently manage for the
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not limited to, interest rates, housing demand, employment levels, and consumer confidence. We believe that these
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factors are contributing to uncertainty, which is resulting in lower levels of advertising performance and reduced
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monetize non-strategic assets, and again of$1.4 million at our Corporate and other category related to the sale of intellectual
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consolidating operations, primarily related to costs associated with systems implementation and the outsourcing of corporate
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functions, partially offset by the reversal of withdrawal liabilities related to multiemployer pension plans of$6.4 million based
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on settlement of the withdrawal liabilities.
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liability related to multiemployer pension plans of$8.6 million, which was expensed as a result of ceasing contributions, costs
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for consolidating operations, primarily related to systems implementation and the outsourcing of corporate functions, and
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facilities consolidation expenses, primarily associated with exiting a lease.
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regions such as Canada, Australia, New Zealand and India. Earnings from operations in foreign regions are translated into U.S.
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dollars at average exchange rates prevailing during the period, and assets and liabilities are translated at exchange rates in effect
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at the balance sheet date. Currency translation fluctuations may impact revenue, expense, and operating income results for our
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currency exchange rate fluctuations positively impacted our revenues and profitability during theyear ended December 31,
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allow us to continue our evolution to a sustainable, growth-focused media and digital marketing solutions company.
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expected to deliver the stabilization required to fuel our plan into the future. We also continue to invest in our people and in the
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skills needed to support our future aims and to retain our talent by remaining an attractive place to work.
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in our Domestic Gannett Media and Newsquest segments – and optimizing our revenue streams across this growing base.
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for our print and digital advertising, reduced the rates for our advertising, and caused marketers to shift, reduce or stop spend.
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continued uncertainty and volatility in the U.S. and global economies which will continue to impact our business. See "Item 1A
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commitment to our communities. We are dedicated to ensuring that we have mindful and ethical business practices that
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positively impact our world. In early 2024, we published our 2024 ESG Report detailing the progress we made on our U.N.
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Sustainable Development Goals ("U.N. SDGs") that include Reduced Inequalities, Climate Action, and Peace, Justice, and
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our millions of registered users. In January 2025, we published our network-wide 2024 Journalism Impact Report, which
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highlighted what we believe are the most influential articles we produced in 2024 and covers topics such as coverage on
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inclusion, diversity and equity as well as climate change. We are committed to the ongoing publishing of an annual network-
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wide Journalism Impact Report, which surfaces the top stories we produced that led to action.
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Media and Newsquest segments but fulfilled by our DMS segment. When discussing segment results, these revenues and expenses are presented gross but
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development, web presence products, customer relationship management, and software-as-a-service solutions, classified
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Print and commercial revenues are generated from the sale of local, national, and classified print advertising products, the
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•Operating costs at the Domestic Gannett Media and Newsquest segments include labor, newsprint, delivery and digital
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operate our marketing solutions and technology infrastructure;
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Theincrease in interest expense for the year ended December 31, 2023 compared to 2022, was primarily due to the impact
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Performance Indicators" in Management's Discussion and Analysis of Financial Condition and Results of Operations" below for further discussion of Digital-only ARPU.
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For the year ended December 31, 2023, Distribution costs decreased compared to 2022, primarily due to a decline associated with lower revenues.
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For the year ended December 31, 2022, Outside services and other costs increased compared to 2021, primarily due to an acquisition in the first quarter of 2022.
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A summary of our DMS segment results is presented below:
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For the year ended December 31, 2022, Compensation and benefits costs increased compared to 2021, primarily due to an increase in payroll expense driven by higher headcount.