Gannett Stock Slides After Q4 Top-Line Miss; Expects To Exceed 2M Paid Digital Subscribers This Year

Gannett Co Inc GCI reported a fourth-quarter FY21 sales decline of 5.6% year-on-year, to $826.54 million, missing the consensus of $838.25 million. Same-store revenues decreased 4.3%.
Advertising and marketing services revenues decreased 6.6%, while Circulation revenues declined 9.2%.
Publishing revenues were $746.8 million (-6% Y/Y), and Digital Marketing Solutions revenues were $113.21 million (+5.5% or +7.2% on a same-store basis).
Total digital revenues rose 5.0% on a same-store basis. Digital-only circulation revenues grew 25.5%.
Digital-only paid subscribers were up 49% and exceeded 1.6 million at the end of the quarter.
Related: Gannett Launches Share Buyback Up To $100M; Amends Credit Agreement
Operating expenses fell by 6.5% Y/Y to $801.9 million. The operating margin was 3%, and operating income for the quarter was $24.6 million.
Adjusted EBITDA fell 22.5% to $115.4 million and represented a 14.0% margin.
EPS loss of $(0.17) narrowed from $(0.92) last year.
The company held $130.8 million in cash and equivalents as of December 31, 2021. Net cash provided by operating activities for twelve months totaled $127.5 million.
Outlook: Gannett sees FY22 revenue of $3.07 billion - $3.16 billion, against the consensus of $3.11 billion.
The company expects Q1 sales of $745 million - $755 million.
"We expect to surpass 2 million paid digital subscribers this year, and to grow at an annual rate of approximately 40% through 2025," said Michael Reed, Gannett Chairman, and CEO.
Price Action: GCI shares are trading lower by 10.4% at $4.75 on the last check Thursday.

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