GateHouse Media Announces Fourth Quarter and 2012 Annual Results.
, N.Y., March 7, 2013 /PRNewswire/ —
Fourth Quarter and 2012 Annual Highlights
* Digital revenue increased 15.8% for the quarter and 26.8% for the
full year. On a same store basis, as defined below, digital revenue
increased 22.4% and 28.0%, respectively.
* Total revenues for the fourth quarter were $125.6 million, down
11.6% from the prior year quarter and down 6.1% on a same store basis.
Full year revenues were $491.0 million, a decrease of 5.0% from the
prior year and 4.2% on a same store basis.
and SG&A expense decreased $6.1 million or
5.5% for the fourth quarter and $15.6 million or 3.6% for the full year.
On a same store basis and excluding investments in new strategic growth
initiatives, the decrease was 3.7% and 4.7%, respectively.
* As Adjusted
was $23.3 million and $81.0 million for the
fourth quarter and full year, respectively; a decrease of 29.3% for the
quarter and 10.4% for the full year. On a same store basis, As Adjusted
EBITDA declined 24.7% and 9.1%, respectively. Excluding investments in
new strategic growth initiatives As Adjusted EBITDA decreased 14.4% and
Free Cash Flow per share
for the fourth quarter and full
year was $0.16 and $0.35, respectively.
* A payment of $2.5 million was made on long-term debt in
with proceeds from the sale of a group of weekly publications in
, city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837.
, Inc. (the “Company” or “GateHouse
See over-the-counter market (OTC).
Pink Sheets: GHSE), a leading multi-media company
providing news and information to local communities, today reported
financial results for the fourth quarter and full year ended
Same Store Results
Comparisons to the prior year were influenced by two factors which
impacted the number of days in the 2011 reporting periods and by the
sale of a group of weekly publications in suburban Chicago on October 1,
2012. In fiscal 2011, there was a 53[sup.rd] week, falling in Q4, for
1. Almost exact or correct:
60% of the business which was already on a 52 week (5-4-4
quarterly) reporting cycle. Also in 2011, the remaining 40% of the
business changed its reporting period from a calendar year to a 52 week
reporting period to be consistent with the rest of the Company, which
resulted in one additional net day in 2011, but an additional 6 days in
Q4. The Company estimated the impact of these two factors for better
comparability year over year in reporting same store results. The 2011
fourth quarter results from the suburban
that were sold on October 1, 2012, were excluded for comparison
purposes. Please see the exhibits to this press release for
See generally accepted accounting principles (GAAP).
revenue to same store revenue.
Commenting on GateHouse Media’s results,
[Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God’s presence.
E. Reed, Chief
Executive Officer of GateHouse Media, said, “During 2012 we made
significant progress along the path of transforming our organization
into a truly multi-media company, focusing on our primary strategic
objectives, including growing our digital product portfolio, audience
v to hold a limb motionless in order to ground its energy; a standard isometric resistance technique, it releases tension and lengthens muscle fibers.
the core business, driving permanent expense
reduction and redeploying some of those expenses toward growth
initiatives that leverage our key assets and strengths. We experienced
strong growth in digital revenues this year with an increase of 28.0% on
a same store basis, and we saw some improvement in circulation revenues.
While we continued to make progress on reducing core
some of these cost savings were invested in new growth initiatives,
particularly new digital service offerings, which extend our product
offerings with the goal of capturing a greater portion of our
advertising customers’ marketing spend and reaching new
“After adjusting for one-time and non-cash items, our operating
expenses declined 3.1% for the year on a same store basis, and 4.7% when
the investment in new strategic growth initiatives is factored out.
While our As Adjusted EBITDA was down 9.1% for the year on a same store
basis, we made strategic decisions to invest in new initiatives during
the year, particularly in the second half of 2012. Excluding these
investments, As Adjusted EBITDA decreased 2.1% for the year.
“As we previously announced, our fourth quarter trends were
negatively impacted by several factors we believe to be temporary. New
Massachusetts legislation has altered and slowed the
leading to large delays in the timing of foreclosure revenues, which
negatively impacted classified revenues. In addition, a soft economic
climate for small businesses in the quarter combined with uncertainty
tr.v. sur·round·ed, sur·round·ing, sur·rounds
1. To extend on all sides of simultaneously; encircle.
2. To enclose or confine on all sides so as to bar escape or outside communication.
the “fiscal cliff” caused local small businesses
to pull back on advertising spend, particularly in mid to late December.
Our 9.1% decline in advertising revenue was the worst quarterly
comparison to prior year since mid-2011. We are seeing improving trends
in the beginning of 2013.
“In 2013, we will continue to focus on our key transformative
objectives. Growing in the digital space will remain a primary
objective. At the same time, we understand the importance of our
traditional business and the need to put in place measures that will
our print advertising revenues while remaining
Marked by persevering, painstaking effort. See Synonyms at busy.
[Middle English, from Old French, from Latin d
in our efforts to reduce the overall cost structure. We expect
to continue to invest in new digital products and the scaling of our
digital offerings as we leverage our core assets. Additionally, we plan
to explore alternatives to strengthen our capital structure.”
Fourth Quarter 2012
Total revenues were $125.6 million for the quarter, a decline of
11.6% compared to the prior year and 6.1% on a same store basis. Total
advertising revenue declined 9.1% on a same store basis. The decline in
total advertising revenue was driven by local retail and classified
revenue, which were down 8.2% and 16.7%, respectively and were partially
offset by 16.4% growth in online advertising revenues. Circulation
revenue decreased 0.6% and commercial print and other revenues increased
8.5% on a same store basis.
Total operating and SG&A expenses in the quarter were $104.0
million, down 5.5% compared to the prior year and down 0.5% on a same
store basis after adjusting for one-time and non-cash items.
for the quarter was $10.0 million, a decrease of
$8.2 million as compared to the prior year. As Adjusted EBITDA for the
quarter was $23.3 million, a decrease of $7.6 million or 24.7% from the
prior year on a same store basis, primarily due to revenue declines that
outpaced expense reduction initiatives as well as $3.2 million of
investment in new strategic growth initiatives.
Levered Free Cash Flow for the quarter declined $5.9 million, or
39.0%, to $9.2 million as compared to $15.1 million for the prior
One-time costs incurred and other non-cash expenses in the quarter
were $3.3 million, related primarily to
initiatives introduced to realize permanent expense reductions.
Full Year 2012
Total revenues were $491.0 million for the full year 2012, a
decrease of 5.0% over the prior year and 4.2% on a same store basis.
Total advertising revenue declined 6.4% on a same store basis. The
decline in total advertising revenue was driven by local retail and
classified revenue, which were down 9.3% and 7.7%, respectively and were
partially offset by 22.8% growth in online advertising revenues.
Circulation revenue increased 1.0% and commercial print and other
revenues increased 1.5% on a same store basis.
Full year 2012 operating costs and SG&A expense declined $15.6
million or 3.6% compared to the prior year, and $13.4 million or 3.1% on
a same store basis after adjusting for one-time and non-cash items. The
expense declines were driven primarily by lower compensation expense and
costs partially offset by investments in new strategic growth
Operating income for the full year 2012 was $28.5 million, compared
to $33.6 million in 2011. As Adjusted EBITDA for the year was $81.0
million, a decrease of $8.1 million or 9.1% on a same store basis,
primarily due to $6.2 million of investment in new strategic growth
initiatives as revenue declines were nearly offset by core reduction
Levered Free Cash Flow for the full year 2012 was $20.4 million
compared to $28.9 million in 2011.
One-time costs incurred and other non-cash expenses in 2012 were
$11.0 million, and related primarily to reorganization efforts and
initiatives introduced to realize permanent expense reductions.
About GateHouse Media, Inc.
GateHouse Media, Inc., headquartered in Fairport,
Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of
, is one
of the largest publishers of locally based print and online media in the
officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world’s third largest country in population and the fourth largest country in area.
as measured by its 78 daily publications. GateHouse Media
currently serves local audiences of approximately 10 million per week
across 21 states through hundreds of community publications and local
websites. GateHouse Media is traded in the over-the-counter market under
the symbol “GHSE.”
For more information regarding GateHouse Media and to be added to
our email distribution list, please visit www.gatehousemedia.com.
Non-GAAP Financial Measures
A non-GAAP financial measure is generally defined as one that
purports to measure historical or future financial performance,
financial position or cash flows, but excludes or includes amounts that
would not be so adjusted in the most comparable GAAP measure. GateHouse
Media defines and uses Adjusted EBITDA, As Adjusted EBITDA, As Adjusted
Revenues, and Levered Free Cash Flow, non-GAAP financial measures, as
set forth below. The Company strongly urges stockholders and other
interested persons not to rely on any single financial measure to
evaluate its business. In addition, because Adjusted EBITDA, As Adjusted
EBITDA, As Adjusted Revenues and Levered Free Cash Flow are not measures
of financial performance under GAAP and are
1. readily affected or acted upon.
2. lacking immunity or resistance and thus at risk of infection.
calculations, these non-GAAP measures, as presented in this press
release, may differ from and may not be comparable to similarly titled
measures used by other companies.
Adjusted EBITDA, As Adjusted EBITDA, As Adjusted Revenues and
Levered Free Cash Flow
The Company defines Adjusted EBITDA as income (loss) from
Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the
before interest, income tax expense (benefit), depreciation
and amortization and other non-recurring or non-cash items. The Company
defines As Adjusted EBITDA as Adjusted EBITDA before other non-cash
items such as non-cash compensation, non-recurring integration and
reorganization costs and Adjusted EBITDA from non-wholly owned
subsidiaries. The Company defines As Adjusted Revenues as total revenues
plus revenues of
less revenues from non-wholly
owned subsidiaries. The Company defines Levered Free Cash Flow as As
Adjusted EBITDA less capital expenditures, cash taxes and interest
expense, excluding non-wholly owned subsidiaries.
Management’s Use of Adjusted EBITDA, As Adjusted EBITDA, As
Adjusted Revenues and Levered Free Cash Flow
Adjusted EBITDA, As Adjusted EBITDA, As Adjusted Revenues and
Levered Free Cash Flow are not measurements of financial performance
under GAAP and should not be considered in isolation or as alternatives
to income from operations, net income (loss), cash flow from continuing
operating activities or any other measure of performance or liquidity
v. de·rived, de·riv·ing, de·rives
1. To obtain or receive from a source.
with GAAP. GateHouse Media’s management
believes these non-GAAP measures, as defined above, are useful to
investors for the following reasons:
* Evaluating performance and identifying trends in day-to-day
performance because the items excluded have little or no significance on
its day-to-day operations;
* Providing assessments of controllable expenses that afford
management the ability to make decisions which are expected to
facilitate meeting current financial goals as well as achieving optimal
financial performance; and
* Indicators for management to determine if adjustments to current
spending decisions are needed.
Adjusted EBITDA, As Adjusted EBITDA, As Adjusted Revenues and
Levered Free Cash Flow provide GateHouse Media with measures of
financial performance, independent of items that are beyond the control
of management in the short-term, such as depreciation and amortization,
taxation and interest expense associated with its capital structure.
Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM.
measure GateHouse Media’s financial performance based
on operational factors that management can impact in the short-term,
namely the cost structure or expenses of the organization. Adjusted
EBITDA, As Adjusted EBITDA, As Adjusted Revenues and Levered Free Cash
Flow are some of the metrics used by senior management and the Board of
Directors to review the financial performance of the business on a
monthly basis. In addition, GateHouse Media’s management utilizes
these metrics to evaluate the Company’s performance, along with
, to determine the funds available for paying the
Certain items in this press release may constitute forward-looking
statements within the meaning of the
Private Securities Litigation
of 1995, and are subject to various risks and uncertainties,
including without limitation, statements
relate prep →
relate prep → ,
progress made by
the Company in its integration efforts, growth in revenues and cash
flow, on-line revenues, expense reduction efforts and potential
acquisition and sale opportunities. Forward-looking statements are
generally identifiable by use of forward-looking
“may,” “will,” “should,”
“potential,” “intend,” “expect,”
,” “seek,” “anticipate,”
tr.v. o·ver·es·ti·mat·ed, o·ver·es·ti·mat·ing, o·ver·es·ti·mates
1. To estimate too highly.
2. To esteem too greatly.
“underestimate,” “believe,” “could,”
“would,” “project,” “predict,”
“continue” or other similar words or expressions. Forward
looking statements are based on certain assumptions or estimates,
discuss future expectations, describe future plans and strategies,
contain projections of results of operations or of financial condition
or state other forward-looking information. The Company’s ability
to predict results or the actual effect of future plans or strategies is
inherently uncertain. Although the Company believes that the
expectations reflected in such forward looking statements are based on
reasonable assumptions, actual results and performance could differ
materially from those set forth in the forward-looking statements.
Factors which could have a material adverse effect on the Company’s
operations and future prospects or which could cause events or
to differ from the forward-looking statements include, but
are not limited to, the condition of the economy and the credit markets
generally, the Company’s ability to maintain adequate liquidity and
financing sources and an appropriate level of debt, the Company’s
ability to maintain debt covenants, the Company’s ability to
successfully grow digital revenues and audience and consumer revenues,
the Company’s ability to successfully stabilize print revenues, the
ability of the Company to successfully identify and develop new business
ventures, the Company’s ability to close on a timely basis upon
announced or contemplated transactions, unexpected liabilities arising
from any transaction or that the Company will not receive the expected
benefits from the transaction, the Company’s ability to generate
sufficient cash flow to cover required interest and long-term
obligations, the effect of the Company’s
obligations on its liquidity, the Company’s ability to integrate
acquired assets and businesses, any increases in the price or reduction
in the availability of newsprint, seasonal and other fluctuations
affecting the Company’s revenues and operating results, any
declines in circulation, the Company’s ability to obtain additional
capital on terms acceptable to it, the Company’s ability to compete
effectively in the local media industry, the Company’s success or
failure in pursuing its digital business and related initiatives and
strategic realignments and undertakings, increases in health costs, the
Company’s vulnerability to economic downturns,
tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates
1. To control or direct according to rule, principle, or law.
or acts of nature in certain
/geo·graph·ic/ () in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map.
pertaining to geography.
areas, increases in competition
for skilled personnel, a portion of the Company’s workforce being
unionized, departure of key officers, increases in market interest
rates, the cost and difficulty of complying with increasing and evolving
regulation, and other risks detailed from time to time in the
Company’s SEC reports, including but not limited to its most recent
Annual Report on Form 10-K filed with the SEC under Commission File
Number 001-33091. When considering forward- looking statements, readers
should keep in mind the risk factors and other cautionary statements in
such SEC filings. Readers are also cautioned not to place undue reliance
on any of these forward-looking statements, which reflect
management’s views as of the date of this press release. The
factors discussed above and the other factors noted in the
Company’s SEC filings could cause actual results to differ
significantly from those contained in any forward-looking statement.
Although the Company believes that the expectations reflected in the
forward-looking statements are reasonable, it cannot guarantee future
results, levels of activity, performance or achievements and expressly
disclaims any obligation to release publicly any updates or
any forward-looking statements to reflect any change in expectations
1. To that, this, or it.
2. Archaic In addition to that; furthermore.
1. to that or it
or change in events, conditions or circumstances on
which any statement is based.
SOURCE GateHouse Media, Inc.