Gannett (GCI) Q3 Earnings Miss, Revenues Beat Estimates
Zacks Investment Research | Oct 26, 2016 11:42PM ET
Diversified media conglomerate, Gannett Co., Inc. (NYSE:GCI) delivered lower-than-expected bottom-line third-quarter 2016 results. The company posted adjusted quarterly earnings of 6 cents a share that missed the Zacks Consensus Estimate of 17 cents, and plunged from 43 cents reported in the year-ago quarter. Higher operating expenses adversely impacted the bottom line.
On a GAAP basis, the company reported loss of 21 cents a share as against earnings of 33 cents in the prior-year quarter.
Gannett reported total revenue of $772.3 million in the quarter, up 10.1% from the prior-year quarter, and came ahead of the Zacks Consensus Estimate of $769 million. Excluding $14.3 million of unfavorable foreign currency translation and $7.4 million of selected exited operations, revenue surged 13.2% year over year.
The increase in revenue came on the back of the buyout of Journal Media Group, Inc., North Jersey Media Group and ReachLocal, and sustained improvement witnessed in national digital advertising revenue. This was partly offset by fall in print advertising demand and an adverse impact on classified employment revenues from an unfavorable affiliate agreement change with CareerBuilder.
However, excluding the impact on revenues from buyouts, foreign currency translations and selected exited operations, total revenue declined 8.6% from the year-ago period. Management hinted that national digital advertising revenue soared 18.5%, whereas digital-only subscriptions advanced 45%.
Advertising revenue increased 11.7% to $429.1 million, whereas circulation revenue jumped 7.7% to $285.6 million. Other operating revenue grew 11.2% to $57.7 million.
Adjusted EBITDA plunged 43% to $55.3 million, while adjusted EBITDA margin contracted 660 basis points to 7.2%.
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