Gannett Co., Inc.

Greetings. Welcome to the Gannett Company Incorporated third quarter 2024 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Matt Esposito, Head of Investor Relations. You may begin.

Thank you. Good morning, everyone, and thank you for joining our call today to discuss Gannett's third quarter 2024 financial results. Presenting on today's call will be Mike Reed, Chairman and Chief Executive Officer, Doug Horn, Chief Financial Officer, Kristen Roberts, Chief Content Officer, and Chris Cho, President of Digital Marketing Solutions. If you navigate to the Gannett website, you will find that we have posted an earnings supplement in addition to our earlier press release. We will be referencing it today on the call as it provides you with additional detail on this quarter's performance. Before we begin, please let me remind you that this call is being recorded. In addition, certain statements made during this call are or may be deemed to be forward-looking statements as defined under the U.S. federal security laws. including those with respect to future results and events and are based upon current expectations these statements involve risks and uncertainties that may cause actual results and events to differ materially from those discussed today we encourage you to read the cautionary statement regarding forward-looking statements in the earnings supplement as well as the risk factors described in gannett's funds made with securities and exchange commission except as required by law We undertake no obligation to publicly update or correct any of the forward-looking statements made during this call. Please keep in mind all comparisons are on a year-over-year basis unless otherwise noted. In addition, we will be discussing non-GAAP financial information during the call, including same-store revenues, free cash flow, adjusted EBITDA, adjusted EBITDA margin, and adjusted net income attributable to Gannett. You can find reconciliations of our non-GAAP measures to the most comparable U.S. GAAP measures in the earnings supplement. Lastly, I would like to remind you that nothing on this call constitutes an offer to sell or solicitation of an offer to purchase any interest in Gannett. The webcast and audiocast are copyrighted material of Gannett and may not be duplicated, reproduced, or rebroadcasted without our prior written consent. With that, I would like to turn the call over to Mike Reed, Gannett's Chairman and CEO.

Thank you, Matt. Good morning, and thanks for joining our third quarter earnings call. We continued to make solid progress in the third quarter across our key priorities. In Q3, adjusted EBITDA totaled approximately $63 million and grew nearly 6% year over year. Three out of four digital revenue categories saw strong growth and further trend improvement year over year, And as a result, total digital revenues surpassed 45% of total revenues, representing an all time high. We also generated approximately 20 million of free cash flow, representing a significant increase of 168% compared to the prior year. In Q3, our audience surpassed 200 million average monthly unique visitors for the first time in our history. reflecting growth of over 7% compared to the prior year. This milestone of 200 million average monthly unique visitors demonstrates our ability to stay closely aligned with our audience's preferences. In the third quarter, a couple of drivers of audience for our network were political events, the Paris Olympics, and the kickoff to football season. We believe our audience results highlight our ability to create content that is both relevant and essential, and that includes being a leading sports content organization. And to further strengthen and leverage our market presence, we launched a partnership with BetMGM that is expected to provide additional content to our sports enthusiasts and enhance the monetization of our content platform. Subsequent to the quarter end, We completed our debt refinancing transactions, which extended our maturity runway, reduced potential future share dilution, and simplified our capital structure. We believe our ability to successfully refinance our debt reflects the strength of our long-term strategy and the progress we have made executing against our plans. Especially this year, as we have intentionally had stabilization at the forefront of our collective efforts. That means we expect stabilizing revenue trends, growing adjusted EBITDA and free cash flow, and improving margins. 2024 is an important step in Gannett's trajectory, which we believe positions us well for sustainable revenue, adjusted EBITDA, and free cash flow growth, which is expected to lead to significant value creation for our shareholders. While we are pleased to see improvement across most digital categories, our year-over-year total revenue was lower than expected, resulting from the sale and unwind of some non-strategic businesses and softer trends in our NewsQuest and DMS segments. However, we are encouraged that same-store revenue trends showed consistent improvement throughout the quarter, with September emerging as our strongest month, and we believe that is a positive indicator for the fourth quarter. Looking ahead to Q4, we believe we will drive improvement in total revenue trends, as well as our digital revenue trends, bringing us closer to our expected revenue inflection point. As a result, we are optimistic about finishing the year strong. Now I'd like to review some of the operational highlights of the third quarter. We are committed to a diversified monetization strategy that is intended to maximize the revenue opportunity across our entire audience and to tailor that opportunity based on individual customer habits. The outstanding audience results from Q3 have been instrumental in improving our top line trends and driving meaningful growth in three out of four digital revenue categories. Importantly, we believe our highly engaged audience is a powerful leading indicator of future revenue opportunities we are poised to unlock. And as a result, we are well positioned to drive further trend improvement moving forward. We also improved our engagement with that audience as we were able to achieve another quarter of double digit page view growth compared to the prior year. We believe this heightened focus on monetizing the full spectrum of our audience through personalized experiences has driven significant wins across our digital business in Q3. One area worth highlighting is our digital-only subscription business. In Q3, we continued to achieve new highs with digital-only subscription revenue surpassing 50 million and digital-only ARPU climbing above $8. We have shared previously that we believe we have significant upside in this digital revenue category through both volume growth and pricing, which we saw in the third quarter. Q3 marked another quarter of sequential growth in digital only paid subscriptions, as well as the second consecutive quarter of year over year subscription growth. Separately, our initiatives around audience expansion and increased engagement drove significant improvement in year-over-year digital advertising trends. Driving these fantastic audience results for Gannett is our Chief Content Officer, Kristen Roberts. I would like to turn the call over to Kristen to provide deeper insights into our audience results for the quarter. Kristen?