LEE ENTERPRISES Inc

Previous wording

Lee Enterprises, Incorporated, together with its subsidiaries, is a digital-first subscription business providing local markets with valuable, high quality, trusted, intensely local news, information, advertising and marketing services. We inform consumers in 73 mid-sized local communities in 26 states with a rapidly growing digital subscription platform including 748,000 digital subscribers. Our core strategy aims to grow audiences and engagement through creating, collecting, and distributing trusted local news and information, continuous improvements to subscriber experience, and offering a full suite of omni-channel advertising and marketing to more than 25,000 local advertisers.

Current wording

Lee Enterprises, Incorporated, together with its subsidiaries, is a digital-first subscription business providing local markets with valuable, high quality, trusted, intensely local news, information, advertising and marketing services. We inform consumers in 72 mid-sized local communities in 25 states with a rapidly growing digital subscription platform including 774,000 digital subscribers. Our core strategy aims to grow audiences and engagement through creating, collecting, and distributing trusted local news and information, continuous improvements to subscriber experience, and offering a full suite of omni-channel advertising and marketing to more than 25,000 local advertisers.

Previous wording

Advertising and marketing services revenue totaled $68.8 million in the 2024 Quarter, down 13.0% compared to the 2023 Quarter. Print advertising revenues were $18.9 million in the 2024 Quarter, down 35.2% compared to the 2023 Quarter due to continued secular declines in demand for print advertising and a reduced product portfolio through sales and elimination of products that do not meet profitability standards. Digital advertising and marketing services totaled $49.9 million in the 2024 Quarter, flat compared to the 2023 Quarter. Digital advertising and marketing services represented 72.5% of the 2024 Quarter total advertising and marketing services revenue, compared to 63.1% in the same period last year.

Current wording

Advertising and marketing services revenue totaled $66.6 million in the 2025 Quarter, down 6.1% compared to the 2024 Quarter. Print advertising revenues were $19.9 million in the 2025 Quarter, down 18.7% compared to the 2024 Quarter due to continued secular declines in demand for print advertising and a reduced product portfolio through sales and elimination of products that do not meet profitability standards. Digital advertising and marketing services totaled $46.7 million in the 2025 Quarter, up 0.6% compared to the 2024 Quarter. Digital advertising and marketing services represented 70.2% of the 2025 Quarter total advertising and marketing services revenue, compared to 65.5% in the same period last year.

Previous wording

Subscription revenue totaled $68.3 million in the 2024 Quarter, down 11.9% compared to the 2023 Quarter. Decline in full access volume, consistent with historical and industry trends were partially offset by selective increases on our full access subscriptions, growth in digital-only subscribers and price increases on digital subscriptions. Digital-only subscribers grew 23% since the 2023 Quarter and now total 748,000. Digital-only subscription revenue grew 31.7% compared to the 2023 Quarter.

Current wording

Subscription revenue totaled $65.0 million in the 2025 Quarter, down 8.9% compared to the 2024 Quarter. Decline in full access volume, consistent with historical and industry trends were partially offset by selective increases on our full access subscriptions, growth in digital-only subscribers and price increases on digital subscriptions. Digital-only subscribers grew 5% since the 2024 Quarter and now total 774,000. Digital-only subscription revenue grew 10.8% compared to the 2024 Quarter.

Previous wording

Other revenue, which primarily consists of commercial printing revenue and digital services from BLOX Digital, decreased $1.2 million, or 8.2%, in the 2024 Quarter compared to the 2023 Quarter. Digital services revenue totaled $5.2 million in the 2024 Quarter, a 6.0% increase compared to the 2023 Quarter. Commercial printing revenue totaled $4.4 million in the 2024 Quarter, a 13.7% decrease compared to the 2023 Quarter, primarily driven by reduction in print volumes from our partners.

Current wording

Other revenue, which primarily consists of commercial printing revenue and digital services from BLOX Digital, decreased $0.5 million, or 3.5%, in the 2025 Quarter compared to the 2024 Quarter. Digital services revenue totaled $5.1 million in the 2025 Quarter, a 2.6% increase compared to the 2024 Quarter. Commercial printing revenue totaled $4.1 million in the 2025 Quarter, a 9.8% decrease compared to the 2024 Quarter, primarily driven by reduction in print volumes from our partners.

Previous wording

Total digital revenue including digital advertising revenue, digital subscription revenue and digital services revenue totaled $75.8 million in the 2024 Quarter, an increase of 7.5% over the 2023 Quarter, and represented 50.3% of our total operating revenue in the 2024 Quarter.

Current wording

Total digital revenue including digital advertising revenue, digital subscription revenue and digital services revenue totaled $73.4 million in the 2025 Quarter, an increase of 3.5% over the 2024 Quarter, and represented 50.8% of our total operating revenue in the 2025 Quarter.

Previous wording

Total operating expenses were $146.8 million in the 2024 Quarter, a 8.4% decrease compared to the 2023 Quarter. Cash Costs, a non-GAAP financial measure used to summarize certain operating expense (see reconciliation of Non-GAAP financial measures below), were down 8.3% in the 2024 Quarter.

Current wording

Total operating expenses were $149.0 million in the 2025 Quarter, a 0.2% decrease compared to the 2024 Quarter. Cash Costs, a non-GAAP financial measure used to summarize certain operating expense (see reconciliation of Non-GAAP financial measures below), were down 0.5% in the 2025 Quarter.

Previous wording

Compensation expense decreased $4.3 million in the 2024 Quarter, or 6.8%, compared to the 2023 Quarter from reductions in full time employees ("FTEs") due to continued business transformation efforts, partially offset by investments in digital talent.

Current wording

Compensation expense increased $0.6 million in the 2025 Quarter, or 1.0%, compared to the 2024 Quarter due to investments in digital talent.

Previous wording

Newsprint and ink costs decreased $2.3 million in the 2024 Quarter, or 35.5%, compared to the 2023 Quarter. The decrease is attributable to declines in newsprint volumes.

Current wording

Newsprint and ink costs decreased $1.2 million in the 2025 Quarter, or 25.3%, compared to the 2024 Quarter. The decrease is attributable to declines in newsprint volumes.

Previous wording

Other operating expenses decreased $5.8 million in the 2024 Quarter, or 7.3%, compared to the 2023 Quarter. Other operating expenses include all operating costs not considered to be compensation, newsprint, depreciation and amortization, or restructuring costs and assets loss on sales, impairments, and other, net. The largest components are costs associated with printing and distribution of our printed products, digital cost of goods sold and facility expenses. The decrease is primarily attributable to lower delivery and other print-related costs due to lower volumes of our print edition.

Current wording

Other operating expenses decreased $0.1 million in the 2025 Quarter, or 0.1%, compared to the 2024 Quarter. Other operating expenses include all operating costs not considered to be compensation, newsprint, depreciation and amortization, or restructuring costs and assets loss on sales, impairments, and other, net. The largest components are costs associated with printing and distribution of our printed products, digital cost of goods sold and facility expenses. The decrease is primarily attributable to lower delivery and other print-related costs due to lower volumes of our print edition.

Previous wording

Restructuring costs and other was flat compared to the 2023 Quarter. Restructuring costs and other include severance costs, litigation expenses, and restructuring expenses.

Current wording

Restructuring costs and other increased $0.9 million compared to the 2024 Quarter. Restructuring costs and other include severance costs, litigation expenses, and restructuring expenses.

Previous wording

Depreciation and amortization expense decreased $0.6 million, or 8.4%, in the 2024 Quarter. The decrease in both is attributable to assets becoming fully depreciated or amortized.

Current wording

Depreciation and amortization expense decreased $1.0 million, or 14.1%, in the 2025 Quarter. The decrease in both is attributable to assets becoming fully depreciated or amortized.

Previous wording

Assets gain on sales, impairments and other, was a net gain of $1.4 million in the 2024 Quarter compared to a net gain of $0.9 million in the 2023 Quarter. Assets gain on sales, impairments and other in the 2024 Quarter were primarily due to the result of the disposition of non-core assets, including real estate.

Current wording

Assets gain on sales, impairments and other, was a net gain of $0.9 million in the 2025 Quarter compared to a net gain of $1.5 million in the 2024 Quarter. Assets gain on sales, impairments and other in the 2025 Quarter were primarily due to the result of the disposition of non-core assets, including real estate.

Previous wording

The factors noted above resulted in an operating income of $4.9 million in the 2024 Quarter compared to operating income of $12.2 million in the 2023 Quarter.

Current wording

The factors noted above resulted in an operating loss of $3.4 million in the 2025 Quarter compared to operating income of $7.8 million in the 2024 Quarter.

Previous wording

Non-operating income and expense decreased by $0.2 million, or 2.2%. The decrease is primarily driven by a decrease in Interest expense of $0.2 million, or 1.5%, to $10.1 million in the 2024 Quarter, compared to the same Quarter last year. The decrease was due to a lower outstanding balance on our Term Loan. Our weighted average cost of debt was 9% at the end of the 2024 Quarter and 2023 Quarter.

Current wording

Interest expense increased $0.2 million, or 1.5%, to $10.3 million in the 2025 Quarter, compared to the same Quarter last year. Our weighted average cost of debt was 9% at the end of the 2025 Quarter and 2024 Quarter.

Previous wording

Other non-operating income and expense consists of benefits associated with our pension and other postretirement plans. We recorded $4.7 million of periodic pension and other postretirement benefits in the 2024 Period compared to $0.9 million in the 2023 Period. The increase was attributable due to the Company recognizing a non-cash curtailment gain of $1.2 million in the 2024 Period as a result of outsourcing certain postemployment defined benefit plan functions. Additionally, during the 2024 Period, the Company completed a voluntary lump sum payment of future benefits to terminated vested participants. The offer was accepted by 522 participants, representing a $22.6 million pension plan liability. As a result of the offer, a non-cash settlement gain of $2.4 million was recorded in Curtailment/Settlement gain on the Consolidated Statements of Income and Comprehensive Income. Both assets and liabilities of the plan were reduced by $22.6 million.

Current wording

Other non-operating income and expense consists of benefits associated with our pension and other postretirement plans and the fair value adjustment of our Warrants. We recorded $0.7 million periodic pension and other postretirement benefits in the 2025 Quarter compared to $3.9 million in the 2024 Quarter. The decrease was a result of recognizing a non-cash curtailment gain of $1.2 million in the 2024 Quarter as a result of outsourcing certain postemployment defined benefit plan functions. Additionally, during the 2024 Quarter, the Company completed a voluntary lump sum payment of future benefits to terminated vested participants. The offer was accepted by 522 participants representing $22.6 million in plan liabilities. As a result of the offer, a non-cash settlement gain of $2.4 million was recorded in Curtailment/Settlement gain on the Consolidated Statements of Income and Comprehensive Income. Both assets and liabilities of the plan were reduced by $22.6 million.

Previous wording

We recorded an income tax benefit of $0.8 million, or 18.7% of pretax loss in the 2024 Quarter. In the 2023 Quarter, we recognized an income tax expense of $0.4 million, or 15.6% of pretax income.

Current wording

We recorded an income tax expense of $3.2 million, or (25.0)% of pretax loss in the 2025 Quarter. In the 2024 Quarter, we recognized an income tax expense of $0.2 million, or 16.7% of pretax income.

Previous wording

Net loss was $3.7 million and diluted loss per share were $0.73 for the 2024 Quarter compared to net income of $2.1 million and diluted earnings per share of $0.25 for the 2023 Quarter. The change reflects the various items discussed above.

Current wording

Net loss was $16.2 million and diluted loss per share were $2.80 for the 2025 Quarter compared to net income of $1.2 million and diluted earnings per share of $0.12 for the 2024 Quarter. The change reflects the various items discussed above.

Previous wording

EBITDA is also a component of the calculation used by stockholders and analysts to determine the value of our business when using the market approach, which applies a market multiple to financial metrics. It is also a measure used to calculate the leverage ratio of the Company, which is a key financial ratio monitored and used by the Company and its investors. Adjusted EBITDA is defined as net income (loss), plus non-operating expenses, income tax expense, depreciation and amortization, assets loss (gain) on sales, impairments and other, restructuring costs and other, stock compensation and our 50% share of EBITDA from TNI and MNI, minus equity in earnings of TNI and MNI.

Current wording

Adjusted EBITDA is a non-GAAP financial performance measure that enhances financial statement users' overall understanding of the operating performance of the Company. The measure isolates unusual, infrequent, or non-cash transactions from the operating performance of the business. This allows users to easily compare operating performance among various fiscal periods and how management measures the performance of the business. This measure also provides users with a benchmark that can be used when forecasting future operating performance of the Company that excludes unusual, nonrecurring or one-time transactions. Adjusted EBITDA is also a component of the calculation used by stockholders and analysts to determine the value of our business when using the market approach, which applies a market multiple to financial metrics. It is also a measure used to calculate the leverage ratio of the Company, which is a key financial ratio monitored and used by the Company and its investors. Adjusted EBITDA is defined as net income (loss), plus non-operating expenses, income tax expense, depreciation and amortization, assets loss (gain) on sales, impairments and other, restructuring costs and other, stock compensation and our 50% share of EBITDA from TNI and MNI, minus equity in earnings of TNI and MNI.

Previous wording

Our operations have historically generated strong positive cash flow and are expected to provide sufficient liquidity, together with cash on hand, to meet our requirements, primarily operating expenses, interest expense and capital expenditures for at least the next twelve months. A summary of our cash flows is included in the narrative below.

Current wording

Our operations have historically generated cash flow and are expected to provide sufficient liquidity, together with cash on hand, to meet our requirements, primarily operating expenses, interest expense and capital expenditures for at least the next twelve months. A summary of our cash flows is included in the narrative below.

Previous wording

Cash provided by operating activities totaled $1.4 million in 2024 Period compared to cash required by operating activities of $1.7 million in 2023 Period, an increase of $3.1 million. The increase was driven by an increase in working capital of $5.7 million, primarily related to favorable change in accounts receivable partially offset by a decrease in operating results of $2.6 million (defined as net loss adjusted for non-working capital items).

Current wording

Cash required by operating activities totaled $7.3 million in 2025 Period compared to cash provided by operating activities of $0.1 million in 2024 Period, a decrease of $7.4 million. The decrease was driven by a decrease in operating results of $13.6 million (defined as net loss adjusted for non-working capital items) partially offset by an increase in working capital of $6.2 million, primarily related to favorable change in accounts receivable.

Previous wording

Cash provided by investing activities totaled $0.5 million in the 2024 Period compared to cash provided by investing activities of $5.3 million in the 2023 Period. 2024 Period and 2023 Period included $7.1 million and $7.2 million, respectively, in proceeds from the sale of assets as the Company divested non-core real estate.

Current wording

Cash provided by investing activities totaled $3.9 million in the 2025 Period compared to cash provided by investing activities of $2.1 million in the 2024 Period. 2025 Period and 2024 Period included $5.4 million and $3.1 million, respectively, in proceeds from the sale of assets as the Company divested non-core real estate.

Previous wording

Cash required for financing activities totaled $3.0 million in the 2024 Period compared to $2.8 million in 2023 Period. Debt reduction accounted for nearly all the usage of funds in both periods.

Current wording

No cash was required for financing activities in the 2025 Period compared to $1.4 million in 2024 Period. Debt reduction accounted for nearly all the usage of funds in the prior period.

Previous wording

Our liquidity, consisting of cash on the balance sheet, totaled $13.4 million on June 23, 2024. This liquidity amount excludes any future cash flows from operations. We expect all interest and principal payments due in the next twelve months will be satisfied by existing cash and our cash flows, which will allow us to maintain an adequate level of liquidity.

Current wording

Our liquidity, consisting of cash on the balance sheet, totaled $6.1 million on December 29, 2024. This liquidity amount excludes any future cash flows from operations. We expect all interest and principal payments due in the next twelve months will be satisfied by existing cash and our cash flows, which will allow us to maintain an adequate level of liquidity.