E.W. Scripps Company (The)

Ladies and gentlemen, thank you for standing by and welcome to the Scripps Second Quarter 2021 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will be given at that time. Should you require assistance during the call, please press star, then zero, and an operator will assist you offline. As a reminder, your conference is being recorded. I would now like to turn the conference over to your host, Head of Ambassador Relations, Carolyn Michelli. Please go ahead.

Thank you, Lois. Good morning, everyone, and thank you for joining us for a discussion of the E.W. Scripps Company's financial results and business strategies. You can visit Scripps.com for more information and a link to the replay of this call. A reminder that our conference call and webcast include forward-looking statements, and actual results may differ. Factors that may cause them to differ are outlined in our SEC filings. We do not intend to update any forward-looking statements we make today. Included on this call will be a discussion of certain non-GAAP financial measures that are provided as supplements to assist management and the public in their analysis and valuation of the company. These metrics are not formulated in accordance with GAAP and are not meant to replace GAAP financial measures and may differ from other companies' uses or formulations. Included in our earnings release are the reconciliations of non-GAAP financial measures to the GAAP measures reported in our financial statements. We'll hear first this morning from Scripps President and CEO Adam Simpson, Chief Financial Officer Jason Combs, Local Media President Brian Lawler, and Scripps Networks President Lisa Knudsen. Also on the call is Controller Dan Firsty. Here's Adam.

Good morning, everybody, and thanks for joining us. Today, Scripps is reporting a quarter of beats across the board as we continue to deliver stellar operating results. driven by strong sales execution in both our local media and Scripps Networks businesses. In fact, what appears to be industry-leading results in local. Both divisions turned in higher-than-expected revenue and profitability, aided by the return of the U.S. economy and the ad marketplace, as well as excellent work from our sales teams. Because of this strong performance and with a clear view into the back half of the year, I'm very pleased to share that we have raised our free cash flow guide for this year from a range of $210 to $240 million to a new range starting at $240 million and moving up to $260 million. Investors who have been with us and our sector for a while will recognize this as a remarkable achievement in a non-election year. Today we're in the early stages of an economic recovery. still very much navigating a global pandemic, and seven months into the successful integration of the company's largest acquisition in its history. This level of execution, the second quarter results in today's free cash flow guide, would not have been possible without the transformation of this company over the last several years. We have assembled a large portfolio of high-performing local television stations to serve local audiences and an expanding list of advertisers, a platform of scale that captures the full retrans revenue opportunity and is exceptionally well designed for political advertising. We have better aligned our company's expense structure with our current operating structure, tightened our focus, and unlocked shareholder value when we grew and then exited our podcasting and digital audio businesses for very nice cash-on-cash returns. and through M&A, innovation, and organic growth, emerged with a full-scale national television networks business, the largest portfolio of national broadcast networks, reaching more than 90% of U.S. TV households with exceptional margins and an attractive organic growth profile in an expanding television marketplace. I hope you'll agree that Scripps today is a high-performing company at every level, an enterprise that, once again, has proven its ability to manage through change. Actually, I should say take advantage of change as an opportunity and execute at the highest level for the benefit of our shareholders. The second straight quarter of exceeding expectations after the company's transformation is merely the beginning of the near-term benefit of our work. We are realizing these short-term gains while we are also positioned exceptionally well for the longer-term value creation ahead. And we see no reason to sacrifice one over the other. We know that investors want us to achieve both at the same time. We aren't sacrificing our mission focus either. And I'd like to end with a few words about meaningful recognition we've recently received. A few weeks ago, the NAB Leadership Foundation recognized Scripps with its prestigious 2021 Service to America Award. This award honors one company for its outstanding community service, and we were honored for our local station project, The Rebound, which helps our viewers navigate the road back to economic recovery. We're incredibly proud of our local teams all across the country who executed this important and ongoing initiative. In addition, Scripps received three top Women in Media awards from Synopsys Media. Scripps Network's President Lisa Knutson was honored as a corporate visionary. Chief Diversity Officer and Employment Attorney Danielle Wright was recognized as an industry innovator and disruptor for her work to bring Scripps' equity, diversity, and inclusion strategies to life. And Scripps itself was selected as a 2021 Distinguished Company because of its work to support and promote women leaders. These awards recognize some of our most closely held company values, serving our audiences through objective news and information, leading the way toward the future of our industry, and maintaining a respectful, inclusive workplace. We very much appreciate this independent acknowledgment of our employees' hard work. Now here's Jason.