Gannett Executives Speak at the UBS Media and Communications Conference
McLEAN, VA – Gannett (NYSE: GCI) executives at the UBS Media and Communications Conference today updated key developments in the company’s businesses particularly its digital strategy. Management also provided preliminary results for the fourth quarter and the company’s outlook for 2012. CareerBuilder, which is 53 percent owned by Gannett, also presented.
Gracia Martore, Gannett’s president and chief executive officer, discussed the company’s unique position in the media landscape.
“Gannett remains strong and I am confident in our future. We will continue to be successful and create growth by leveraging attributes unique to Gannett – our powerful local and national brands and our scale,” Ms. Martore noted. “We are revitalizing our local news organizations, building out our portfolio into high potential adjacent businesses, and continuing to make smart investments for growth. We are taking what we do well and putting it to work to strengthen our company.” Ms. Martore highlighted several new initiatives including the USA TODAY Sports Media Group, Gannett Publishing Services and content monetization.
Matt Ferguson, chief executive officer of CareerBuilder, reviewed its business model, market position in the U.S. and internationally and the online employment outlook. “The demand we see for our products and services and ongoing conversations with employers point to continued growth for our business,” he noted. “We plan on continuing to grow core job posting and resume database offerings as well as many new services as we move into 2012. CareerBuilder has delivered strong growth in an anemic jobs market. Needless to say, we see significant growth potential in a more robust economy both in the U.S. and abroad.”
“Looking to 2012, employers are likely to remain watchful, but optimistic, as they assess the impact of rising energy costs, the European debt crisis and other factors,” he continued. “Barring any major economic upsets, we expect 2012 to bring a better hiring picture than 2011 especially in the second half of the year.”
David Payne, Gannett’s chief digital officer, reviewed the company’s digital strategy. “To continue to best position Gannett for a successful digital future, we have an aggressive roadmap to develop next generation mobile, tablet and browser experiences for USA TODAY and our 100 plus properties. We are also integrating our back end editorial, publishing and advertising platforms. Ultimately, this investment in systems will enable more rapid product development and keep Gannett at the forefront of digital innovation and drive new revenue for the company,” he said.
Chief Financial Officer Paul Saleh provided a summary of revenue results for each of the company’s business segments for the fourth quarter-to-date and reviewed operating assumptions
for the upcoming year. “We have been operating in a challenging economic environment throughout the year although we have seen a slight improvement in business activity recently. We remain focused on enhancing returns on our existing assets. At this point, we are very comfortable with the current consensus of earnings per share estimates of 69 cents.
Speeches by the Gannett executives will be available by Webcast for 30 days at www.gannett.com.
Attached to this release and posted on the company’s Web site under Investor Relations are Gannett’s operating assumptions for 2012.
Certain factors affecting forward-looking statements
Certain statements in this press release, including the operating assumptions for 2012, may be deemed “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained in this press release, including the operating assumptions, are subject to a number of risks and uncertainties that could adversely affect the company’s ability to obtain these results include, without limitation, the following factors: (a) increased consolidation among major retailers or other events which may adversely affect business operations of major customers and depress the level of local and national advertising; (b) a continuance of the generally soft economic conditions in the U.S. and the UK or a further economic downturn leading to a continuing or accelerated decrease in circulation or local, national or classified advertising; (c) a further decline in general newspaper readership and/or advertiser patterns as a result of competitive alternative media or other factors; (d) an increase in newsprint or syndication programming costs over the levels anticipated; (e) labor disputes which may cause revenue declines or increased labor costs; (f) acquisitions of new businesses or dispositions of existing businesses; (g) a decline in viewership of major networks and local news programming; (h) rapid technological changes and frequent new product introductions prevalent in electronic publishing; (i) an increase in interest rates; (j) a weakening in the British pound to U.S. dollar exchange rate; (k) volatility in financial and credit markets which could affect the value of retirement plan assets and the Company’s ability to raise funds through debt or equity issuances; (1) changes in the regulatory environment; (m) an other than temporary decline in operating results and enterprise value that could lead to further non-cash goodwill, or other intangible asset or property, plant and equipment impairment charges; (n) credit rating downgrades, which could affect the availability and cost of future financing; and (o) general economic, political and business conditions. Other risk factors that could cause actual results to differ materially from these forward-looking statements are disclosed from time to time in the Company’s current and periodic SEC reports. Any forward-looking statements in this press release should be evaluated in light of these important risk factors.
Gannett is not responsible for updating the information contained in these assumptions beyond the published date, or for changes made to the assumptions by wire services, Internet service providers or other media.
About Gannett
Gannett Co., Inc. (NYSE: GCI) is an international media and marketing solutions company that informs and engages more than 100 million people every month through its powerful network of broadcast, digital, mobile and publishing properties. Our portfolio of trusted brands offers marketers unmatched local-to-national reach and customizable, innovative marketing solutions across any platform. Gannett is committed to connecting people – and the companies who want to reach them – with their interests and communities. For more information, visit www.gannett.com.
For media inquiries, contact:
Laura Dalton
Director, Corporate Communications
703-854-6049
ljdalton@gannett.com
For investor inquiries, contact:
Jeffrey Heinz
Director, Investor Relations
703-854-6917
jheinz@gannett.com
GANNETT CO., INC.
OPERATING ASSUMPTIONS – 2012
Publishing
A. Headcount down low single digits primarily due to carryover effect of actions taken during 2011.
B. Other costs down low to mid-single digits.
Broadcast
A. Headcount will be up slightly.
B. Costs are expected to be up mid-single digits.
Digital
A. Headcount up mid-single digits.
B. Costs will be up high single digits to low-teens including one-time infrastructure investments.
Newsprint
A. Domestic expense will decline in the low single digits due primarily to lower usage.
B. Newsquest expense will decline in the low single digits due primarily to lower usage.
CONSOLIDATED GANNETT (Including Acquisitions)
A. Capital Expenditures
1. 2012 Plan $90,000,000 (includes one-time infrastructure investments)
2. 2011 Estimate $75,000,000 - $80,000,000
B. Depreciation
1. 2012 Plan $160,000,000
2. 2011 Estimate $166,300,000
C. Amortization of Intangibles
1. 2012 Plan $31,200,000
2. 2011 Estimate $31,500,000
D. Benefit Costs
1. Pension expense will be above 2011 depending on the final return on assets for 2011.
2. Health care costs will be slightly above 2011.
E. Interest Expense
We expect our debt at the beginning of the year in the range of $1.75 - $1.8 billion.
For budget purposes only, we have assumed that all of our free cash flow, after
dividends and share repurchases, will be used to pay down debt.
F. Tax Rate
The tax rate for 2012 will be approximately 35.0%, depending on the mix of earnings
and potential tax audit settlements and tax reserve releases.
Certain factors affecting forward-looking statements
Certain statements in this press release, including the operating assumptions for 2012, may be deemed “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained in this press release, including the operating assumptions, are subject to a number of risks and uncertainties that could adversely affect the company’s ability to obtain these results include, without limitation, the following factors: (a) increased consolidation among major retailers or other events which may adversely affect business operations of major customers and depress the level of local and national advertising; (b) a continuance of the generally soft economic conditions in the U.S. and the UK or a further economic downturn leading to a continuing or accelerated decrease in circulation or local, national or classified advertising; (c) a further decline in general newspaper readership and/or advertiser patterns as a result of competitive alternative media or other factors; (d) an increase in newsprint or syndication programming costs over the levels anticipated; (e) labor disputes which may cause revenue declines or increased labor costs; (f) acquisitions of new businesses or dispositions of existing businesses; (g) a decline in viewership of major networks and local news programming; (h) rapid technological changes and frequent new product introductions prevalent in electronic publishing; (i) an increase in interest rates; (j) a weakening in the British pound to U.S. dollar exchange rate; (k) volatility in financial and credit markets which could affect the value of retirement plan assets and the Company’s ability to raise funds through debt or equity issuances; (1) changes in the regulatory environment; (m) an other than temporary decline in operating results and enterprise value that could lead to further non-cash goodwill, or other intangible asset or property, plant and equipment impairment charges; (n) credit rating downgrades, which could affect the availability and cost of future financing; and (o) general economic, political and business conditions. Other risk factors that could cause actual results to differ materially from these forward-looking statements are disclosed from time to time in the Company’s current and periodic SEC reports. Any forward-looking statements in this press release should be evaluated in light of these important risk factors.
Gannett is not responsible for updating the information contained in these assumptions beyond the published date, or for changes made to the assumptions by wire services, Internet service providers or other media.