DES MOINES, Iowa, Nov. 7, 2019 /PRNewswire/ -- Meredith Corporation (NYSE: MDP; meredith.com) ? the leading media and marketing company with national brands serving 185 million Americans including 115 million unduplicated American women and nearly 90 percent of U.S. millennial women; 150 million digital monthly unique visitors; a paid subscription base of 42 million; and 30 million viewers via 17 local television stations in fast-growing markets ? today reported fiscal 2020 first quarter results:
"Our Local Media Group delivered record revenue for a first quarter in a non-political year, driven by growth in non-political related advertising and consumer revenues," said Meredith Corporation President and Chief Executive Officer Tom Harty. "Our National Media Group results reflect advertising performance which met our long-term expectations on a comparable basis, including high-single digit growth in digital advertising revenues. We also continued our track record of strong expense control. These factors helped drive a 55 percent increase in National Media Group operating profit in the quarter."
Looking more closely at Meredith's fiscal 2020 first quarter:
While Total Company adjusted EBITDA was within the outlook range Meredith previously communicated, the protracted retransmission dispute with DISH Network negatively impacted Local Media Group performance during the first quarter of fiscal 2020. However, Meredith expects to more than offset those revenues over the term of the multi-year agreement.
NATIONAL MEDIA GROUP DETAIL
Fiscal 2020 first quarter National Media Group operating profit increased 55 percent to $28 million. Excluding special items, operating profit was $41 million, up from $32 million, and adjusted EBITDA was $91 million, up from $88 million. Revenues were $533 million. (See Tables 1-2 for supplemental disclosures regarding non-GAAP financial measures.)
Looking more closely at fiscal 2020 first quarter performance compared to the prior year:
Meredith expects to grow revenue and profit at its National Media Group organically and through strategic acquisitions. In support of that goal, Meredith has completed or announced a series of changes to its National Media Group portfolio in fiscal 2020. These include:
"We are encouraged by advertising trends across our powerful and diversified portfolio," said Harty. "To that point, we are currently forecasting year-over-year growth in comparable print advertising revenues for the second quarter of fiscal 2020. At the same time, we continue to innovate, be it launching a new title based on the Property Brothers; repositioning popular brands as consumer-driven newsstand products; or creating sophisticated targeted digital advertising programs for clients. Additionally, we are driving growth in our consumer driven business lines, particularly e-commerce and performance marketing, key pieces of our revenue diversification strategy."
LOCAL MEDIA GROUP DETAIL
Fiscal 2020 first quarter Local Media Group operating profit was $38 million. Adjusted EBITDA was $49 million. Revenues were $193 million. (See Tables 1-2 for supplemental disclosures regarding non-GAAP financial measures.)
Looking more closely at fiscal 2020 first quarter performance compared to the prior year:
"Non-political advertising performance has been up for three consecutive quarters," Harty said. "While it is still early, we expect this trend to continue as fiscal 2020 second-quarter non-political spot advertising is currently pacing up in the mid-single digit-range. Additionally, we expect to see political advertising revenue start to build in our early primary states, particularly Nevada and South Carolina."
Recently, Meredith announced plans to launch a television show based on its Southern Living brand. It will start with four specials this holiday season before expanding to weekly syndication across Meredith's geographically diverse station group.
"The Southern Living Show represents another outstanding collaboration between Meredith's Local and National Media Groups," said Patrick McCreery, Meredith Local Media Group President. "Southern Living's award-winning content ? featuring recipes, home and gardening and Southern culture ? will strike a chord with viewers all over the country."
Earlier in this year, Meredith committed to launching its People Now weekend show in daily syndication beginning in Fall 2020 with distribution across all 12 of its local television markets, and is actively engaged in discussions with other broadcast television owners to carry the show.
Meredith delivered strong performance during the July ratings period, when stations in 7 of its 12 markets ranked No. 1 or No. 2 from sign-on to sign-off.
OTHER FINANCIAL INFORMATION
Meredith recently announced the sale of MONEY.com and its equity interest in Viant. Since its January 2018 acquisition of Time Inc., Meredith has sold former Time Inc. assets viewed as non-core to Meredith's business strategy at attractive multiples, including TIME, FORTUNE, Sports Illustrated, MONEY, Time Inc. UK and Viant. Proceeds have been used to pay down debt. Meredith continues to market Xumo and FanSided.
Meredith remains committed to strong capital stewardship and its Total Shareholder Return strategy, which balances investments in the business with cash returned to shareholders.
Meredith raised its regular dividend by 5.5 percent to $2.30 on an annualized basis in February 2019. This marked the 26th straight year of dividend increases for Meredith and the 72nd consecutive year of dividend payments. Since launching its Total Shareholder Return strategy in October 2011, Meredith has increased its dividend 125 percent. As of November 6, 2019, Meredith's annualized dividend yielded approximately 6 percent.
Meredith adopted the Financial Accounting Standards Board's new standard for lease accounting on July 1, 2019. As a result, assets and liabilities related to operating leases greater than 12 months in length have been recorded on Meredith's consolidated balance sheet.
All earnings per share amounts in the text of this release are on a diluted basis per common share. Both basic and diluted earnings per common share can be found in the attached Condensed Consolidated Statements of Earnings. All fiscal 2020 first quarter comparisons are against the comparable prior-year period unless noted.
OUTLOOK
For full-year fiscal 2020, Meredith continues to expect:
Looking more closely at the second quarter of fiscal 2020, Meredith expects:
CONFERENCE CALL WEBCAST
Meredith will host a conference call on November 7, 2019, at 8:30 a.m. EST to discuss fiscal 2020 first quarter results and its outlook for the second quarter and full year of fiscal 2020. A live webcast will be accessible to the public on the Company's website, and a replay will be available for two weeks. A transcript will be available within 48 hours of the call at meredith.com.
RATIONALE FOR USE AND ACCESS TO NON-GAAP RESULTS
Management uses and presents GAAP and non-GAAP results to evaluate and communicate its performance. Non-GAAP measures should not be construed as alternatives to GAAP measures. Adjusted earnings per share, adjusted EBITDA, and adjusted EBITDA margin are common supplemental measures of performance used by investors and financial analysts. Management believes that adjusted earnings per share and adjusted EBITDA provides an additional analytical tool to clarify the Company's results from core operations and delineate underlying trends. Adjusted earnings per share are defined as net earnings per share from continuing operations before depreciation, amortization and special items. Management has removed these costs as they are deemed to be non-operational in nature. Adjusted EBITDA is defined as earnings from continuing operations before interest expense, income taxes, depreciation, amortization, and special items. Management does not use adjusted EBITDA as a measure of liquidity or funds available for management's discretionary use because it excludes certain contractual and non-discretionary expenditures.
Results excluding special items are supplemental non-GAAP financial measures. While these adjusted results are not a substitute for reported results under GAAP, management believes this information is useful as an aid in further understanding Meredith's current performance, performance trends and financial condition. Reconciliations of GAAP to non-GAAP measures are attached to this press release and available at www.meredith.com.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This release contains certain forward-looking statements that are subject to risks and uncertainties. These statements are based on management's current knowledge and estimates of factors affecting the Company and its operations. Statements in this release that are forward-looking include, but are not limited to, the Company's successful implementation of its strategies; the Company's financial outlook for full year and second quarter of fiscal 2020; the expected benefits of the acquisition of Time Inc.; and the Company's expectations with respect to profit, growth and increasing shareholder value.
Actual results may differ materially from those currently anticipated. Factors that could adversely affect future results include, but are not limited to, downturns in national and/or local economies; a softening of the domestic advertising market; world, national or local events that could disrupt broadcast television; increased consolidation among major advertisers or other events depressing the level of advertising spending; the unexpected loss or insolvency of one or more major clients or vendors; the integration of acquired businesses; changes in consumer reading, purchasing and/or television viewing patterns; increases in paper, postage, printing, syndicated programming or other costs; changes in television network affiliation agreements; technological developments affecting products or methods of distribution; changes in government regulations affecting the Company's industries; increases in interest rates; the consequences of acquisitions and/or dispositions; the risks associated with the Company's acquisition of Time Inc., including the Company's ability to comply with the terms of its debt and equity financings; and the risk factors contained in the Company's most recent Form 10-K filed with the Securities and Exchange Commission, which are available on the SEC's website at www.sec.gov. The Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.
ABOUT MEREDITH CORPORATION
Meredith Corporation has been committed to service journalism for more than 117 years. Today, Meredith uses multiple distribution platforms-including broadcast television, print, digital, mobile and video-to provide consumers with content they desire and to deliver the messages of its advertising and marketing partners.
Meredith's National Media Group reaches over 185 million unduplicated American consumers every month, including nearly 90 percent of U.S. millennial women. Meredith is a leader in creating content across media platforms and life stages in key consumer interest areas such as entertainment, food, lifestyle, parenting and home. Meredith is the No. 1 magazine operator in the U.S., and owner of the largest premium content digital network for American consumers. Meredith's leading national brands include PEOPLE, Better Homes & Gardens, InStyle, Allrecipes, REAL SIMPLE, SHAPE, Southern Living and Martha Stewart Living. Meredith also features robust brand licensing activities including more than 3,000 SKUs of branded products at 4,000 Walmart stores across the U.S. and at walmart.com. Meredith's National Media Group also includes leading affinity marketer Synapse, and The Foundry, the company's state-of-the-art creative lab and content studio.
Meredith's Local Media Group includes 17 television stations reaching 11 percent of U.S. households and 30 million viewers. Meredith's portfolio is concentrated in large, fast-growing markets, with seven stations in the nation's Top 25 markets-including Atlanta, Phoenix, St. Louis and Portland-and 13 in the Top 50. Meredith's stations produce more than 700 hours of local news and entertainment content each week, and operate leading local digital destinations. Meredith also owns MNI Targeted Media, which delivers targeted advertising solutions to more than 1,200 clients on a local, regional and national level.
Meredith Corporation and Subsidiaries | |||||||
Condensed Consolidated Statements of Earnings (Unaudited) | |||||||
Three months ended September 30, | 2019 | 2018 | |||||
(In millions except per share data) | |||||||
Revenues | |||||||
Advertising related | $ | 379.6 | $ | 425.5 | |||
Consumer related | 323.1 | 327.8 | |||||
Other | 22.5 | 21.1 | |||||
Total revenues | 725.2 | 774.4 | |||||
Operating expenses | |||||||
Production, distribution, and editorial | 273.7 | 289.1 | |||||
Selling, general, and administrative | 330.8 | 350.3 | |||||
Acquisition, disposition, and restructuring related activities | 14.1 | 17.1 | |||||
Depreciation and amortization | 58.5 | 63.7 | |||||
Impairment of long-lived assets | 5.2 | ? | |||||
Total operating expenses | 682.3 | 720.2 | |||||
Income from operations | 42.9 | 54.2 | |||||
Non-operating income, net | 8.6 | 7.3 | |||||
Interest expense, net | (38.9) | (41.6) | |||||
Earnings from continuing operations before income taxes | 12.6 | 19.9 | |||||
Income tax expense | (0.5) | (3.7) | |||||
Earnings from continuing operations | 12.1 | 16.2 | |||||
Earnings (loss) from discontinued operations, net of income taxes | (6.0) | 0.8 | |||||
Net earnings | $ | 6.1 | $ | 17.0 | |||
Basic earnings (loss) per share attributable to common shareholders | |||||||
Continuing operations | $ | (0.17) | $ | (0.07) | |||
Discontinued operations | (0.13) | 0.01 | |||||
Basic loss per common share | $ | (0.30) | $ | (0.06) | |||
Basic average common shares outstanding | 45.6 | 45.1 | |||||
Diluted earnings (loss) per share attributable to common shareholders | |||||||
Continuing operations | $ | (0.17) | $ | (0.07) | |||
Discontinued operations | (0.13) | 0.01 | |||||
Diluted loss per common share | $ | (0.30) | $ | (0.06) | |||
Diluted average common shares outstanding | 45.6 | 45.1 | |||||
Dividends paid per common share | $ | 0.575 | $ | 0.545 |
Meredith Corporation and Subsidiaries | |||||||
Segment Information (Unaudited) | |||||||
Three months ended September 30, | 2019 | 2018 | |||||
(In millions) | |||||||
Revenues | |||||||
National media | |||||||
$ | 160.4 | $ | 185.2 | ||||
Digital | 91.6 | 84.9 | |||||
Third party sales | 19.0 | 17.1 | |||||
Total advertising related | 271.0 | 287.2 | |||||
Subscription | 150.5 | 160.7 | |||||
Newsstand | 42.6 | 39.1 | |||||
Affinity marketing | 13.9 | 18.9 | |||||
Licensing | 20.0 | 24.8 | |||||
Digital and other consumer driven | 16.5 | 11.0 | |||||
Total consumer related | 243.5 | 254.5 | |||||
Project based | 14.4 | 9.4 | |||||
Other | 4.0 | 9.5 | |||||
Total other | 18.4 | 18.9 | |||||
Total national media | 532.9 | 560.6 | |||||
Local media | |||||||
Non-political spot | 76.8 | 74.9 | |||||
Political spot | 2.6 | 36.1 | |||||
Digital | 4.2 | 3.9 | |||||
Third party sales | 25.5 | 24.0 | |||||
Total advertising related | 109.1 | 138.9 | |||||
Consumer related | 79.6 | 73.3 | |||||
Other | 4.1 | 2.2 | |||||
Total local media | 192.8 | 214.4 | |||||
Intersegment revenue elimination | (0.5) | (0.6) | |||||
Total revenues | $ | 725.2 | $ | 774.4 |
Continued | |||||||
Meredith Corporation and Subsidiaries | |||||||
Segment Information (Unaudited) | |||||||
Three months ended September 30, | 2019 | 2018 | |||||
(In millions) | |||||||
Operating profit | |||||||
National media | $ | 28.1 | $ | 18.1 | |||
Local media | 38.4 | 67.5 | |||||
Unallocated corporate | (23.6) | (31.4) | |||||
Income from operations | $ | 42.9 | $ | 54.2 | |||
Depreciation and amortization | |||||||
National media | $ | 47.4 | $ | 52.3 | |||
Local media | 9.6 | 9.1 | |||||
Unallocated corporate | 1.5 | 2.3 | |||||
Total depreciation and amortization | $ | 58.5 | $ | 63.7 | |||
Adjusted EBITDA 1 | |||||||
National media | $ | 90.6 | $ | 87.9 | |||
Local media | 48.9 | 77.4 | |||||
Unallocated corporate | (17.1) | (22.0) | |||||
Total Adjusted EBITDA | $ | 122.4 | $ | 143.3 |
1 | Adjusted EBITDA is earnings from continuing operations before interest expense, income taxes, depreciation, amortization, and special items. |
Meredith Corporation and Subsidiaries | |||||||
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
Assets | September 30, | June 30, | |||||
(In millions) | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 27.4 | $ | 45.0 | |||
Accounts receivable, net | 589.5 | 609.1 | |||||
Inventories | 66.1 | 62.7 | |||||
Current portion of subscription acquisition costs | 258.4 | 242.0 | |||||
Assets held-for-sale | 312.8 | 321.0 | |||||
Other current assets | 72.2 | 70.3 | |||||
Total current assets | 1,326.4 | 1,350.1 | |||||
Property, plant, and equipment, net | 445.0 | 450.3 | |||||
Operating lease assets | 501.6 | ? | |||||
Subscription acquisition costs | 291.5 | 273.9 | |||||
Other assets | 265.8 | 269.6 | |||||
Intangible assets, net | 1,785.6 | 1,813.6 | |||||
Goodwill | 1,979.4 | 1,979.4 | |||||
Total assets | $ | 6,595.3 | $ | 6,136.9 | |||
Liabilities, Redeemable Convertible Preferred Stock, and Shareholders' Equity | |||||||
Current liabilities | |||||||
Current portion of operating lease liabilities | $ | 37.4 | $ | ? | |||
Accounts payable | 217.3 | 242.6 | |||||
Accrued expenses and other liabilities | 199.8 | 307.2 | |||||
Current portion of unearned revenues | 473.0 | 458.9 | |||||
Liabilities associated with assets held-for-sale | 243.4 | 252.1 | |||||
Total current liabilities | 1,170.9 | 1,260.8 | |||||
Long-term debt | 2,394.6 | 2,333.3 | |||||
Operating lease liabilities | 495.3 | ? | |||||
Unearned revenues | 341.1 | 318.6 | |||||
Deferred income taxes | 519.2 | 506.2 | |||||
Other noncurrent liabilities | 200.9 | 203.2 | |||||
Total liabilities | 5,122.0 | 4,622.1 | |||||
Redeemable convertible Series A preferred stock | 544.7 | 540.2 | |||||
Shareholders' equity | |||||||
Common stock | 40.1 | 40.1 | |||||
Class B stock | 5.1 | 5.1 | |||||
Additional paid-in capital | 222.9 | 216.7 | |||||
Retained earnings | 711.2 | 759.0 | |||||
Accumulated other comprehensive loss | (50.7) | (46.3) | |||||
Total shareholders' equity | 928.6 | 974.6 | |||||
Total liabilities, redeemable convertible preferred stock, and shareholders' equity | $ | 6,595.3 | $ | 6,136.9 |
Meredith Corporation and Subsidiaries | |||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) | |||||||
Three months ended September 30, | 2019 | 2018 | |||||
(In millions) | |||||||
Net cash used in operating activities | $ | (13.5) | $ | (36.0) | |||
Cash flows from investing activities | |||||||
Acquisitions of and investments in businesses and assets, net of cash acquired | (14.5) | (1.8) | |||||
Proceeds from disposition of assets, net of cash sold | 0.3 | 13.4 | |||||
Additions to property, plant, and equipment | (15.9) | (7.5) | |||||
Net cash provided by (used in) investing activities | (30.1) | 4.1 | |||||
Cash flows from financing activities | |||||||
Proceeds from issuance of long-term debt | 165.0 | ? | |||||
Repayments of long-term debt | (105.0) | (200.0) | |||||
Dividends paid | (41.6) | (39.8) | |||||
Purchases of Company stock | (1.8) | (3.2) | |||||
Proceeds from common stock issued | 0.5 | 1.1 | |||||
Payment of acquisition related contingent consideration | ? | (19.3) | |||||
Financing lease payments | (0.7) | ? | |||||
Net cash provided by (used in) financing activities | 16.4 | (261.2) | |||||
Effect of exchange rate changes on cash and cash equivalents | 0.3 | (1.7) | |||||
Change in cash held-for-sale | 9.3 | 1.2 | |||||
Net decrease in cash and cash equivalents | (17.6) | (293.6) | |||||
Cash and cash equivalents at beginning of period | 45.0 | 437.6 | |||||
Cash and cash equivalents at end of period | $ | 27.4 | $ | 144.0 |
Table 1 | |||||||
Meredith Corporation and Subsidiaries | |||||||
Supplemental Disclosures Regarding Non-GAAP Financial Measures | |||||||
Special Items - The following tables show earnings from continuing operations as reported under accounting principles generally accepted in the United States of America (GAAP) and excluding the special items. Earnings from continuing operations excluding the special items, depreciation, and amortization are non-GAAP measures. Management's rationale for presenting non-GAAP measures is included in the text of this earnings release. | |||||||
Three months ended September 30, | 2019 | 2018 | |||||
(In millions) | |||||||
Earnings from continuing operations | $ | 12.1 | $ | 16.2 | |||
Special items | |||||||
Severance and related benefit costs | 6.1 | 10.6 | |||||
Write-down of impaired assets | 5.2 | ? | |||||
Integration and restructuring costs | 8.4 | 14.4 | |||||
Gain on sale of businesses and assets | (0.4) | (10.4) | |||||
Release of lease guarantee | (8.0) | ? | |||||
Loss on investment | 1.1 | ? | |||||
Other | ? | 3.5 | |||||
Special items subtotal | 12.4 | 18.1 | |||||
Tax benefit on special items | (3.2) | (4.6) | |||||
Net special items | 9.2 | 13.5 | |||||
Earnings from continuing operations before special items (non-GAAP) | 21.3 | 29.7 | |||||
Depreciation and amortization | 58.5 | 63.7 | |||||
Tax impact of depreciation and amortization | (14.9) | (16.3) | |||||
Net depreciation and amortization impact | 43.6 | 47.4 | |||||
Adjusted earnings (non-GAAP) | $ | 64.9 | $ | 77.1 | |||
Adjusted diluted earnings per share attributable to common shareholders | |||||||
Continuing operations | $ | (0.17) | $ | (0.07) | |||
Per share impact of net special items | 0.20 | 0.29 | |||||
Earnings from continuing operations before special items (non-GAAP) | 0.03 | 0.22 | |||||
Per share impact of depreciation and amortization | 0.96 | 1.02 | |||||
Adjusted earnings per share (non-GAAP) | $ | 0.99 | $ | 1.24 |
Table 2 | ||||||||||||
Meredith Corporation and Subsidiaries | ||||||||||||
Supplemental Disclosures Regarding Non-GAAP Financial Measures | ||||||||||||
Special Items | ||||||||||||
The following tables show results of operations as reported under GAAP and excluding the special items. Results of operations excluding the special items are non-GAAP measures. Management's rationale for presenting non-GAAP measures is included in the text of this earnings release. | ||||||||||||
Adjusted EBITDA | ||||||||||||
Consolidated adjusted EBITDA, which is reconciled to net earnings in the following tables, is defined as earnings from continuing operations before interest expense, income taxes, depreciation, amortization, and special items. | ||||||||||||
Segment adjusted EBITDA is a measure of segment earnings before depreciation, amortization, and special items. Segment adjusted EBITDA margin is defined as segment adjusted EBITDA divided by segment revenues. | ||||||||||||
Three months ended September 30, 2019 | National Media | Local Media | Unallocated Corporate | Total | ||||||||
(In millions) | ||||||||||||
Revenues | $ | 532.9 | $ | 192.8 | ||||||||
Net earnings | $ | 6.1 | ||||||||||
Loss from discontinued operations, net of income taxes | 6.0 | |||||||||||
Earnings from continuing operations | 12.1 | |||||||||||
Income tax expense | 0.5 | |||||||||||
Interest expense, net | 38.9 | |||||||||||
Non-operating income, net | (8.6) | |||||||||||
Operating profit | $ | 28.1 | $ | 38.4 | $ | (23.6) | 42.9 | |||||
Special items included in operating profit: | ||||||||||||
Write-down of impaired assets | 5.2 | ? | ? | 5.2 | ||||||||
Severance and related benefit costs | 5.1 | 0.6 | 0.4 | 6.1 | ||||||||
Integration and restructuring costs | 3.0 | ? | 5.4 | 8.4 | ||||||||
Gain on sale of businesses and assets | (0.4) | ? | ? | (0.4) | ||||||||
Total special items included in operating profit | 12.9 | 0.6 | 5.8 | 19.3 | ||||||||
Operating profit excluding special items (non-GAAP) | 41.0 | 39.0 | (17.8) | 62.2 | ||||||||
Non-operating income, net | 9.1 | 0.3 | (0.8) | 8.6 | ||||||||
Special items included in non-operating income, net | ||||||||||||
Reversal of lease guarantee | (8.0) | ? | ? | (8.0) | ||||||||
Loss on investment | 1.1 | ? | ? | 1.1 | ||||||||
Total special items included in non-operating income, net | (6.9) | ? | ? | (6.9) | ||||||||
Depreciation and amortization | 47.4 | 9.6 | 1.5 | 58.5 | ||||||||
Adjusted EBITDA (non-GAAP) | $ | 90.6 | $ | 48.9 | $ | (17.1) | $ | 122.4 | ||||
Segment operating margin | 5.3 | % | 19.9 | % | ||||||||
Segment adjusted EBITDA margin | 17.0 | % | 25.4 | % |
Table 2 Continued | ||||||||||||
Three months ended September 30, 2018 | National Media | Local Media | Unallocated Corporate | Total | ||||||||
(In millions) | ||||||||||||
Revenues | $ | 560.6 | $ | 214.4 | ||||||||
Net earnings | $ | 17.0 | ||||||||||
Earnings from discontinued operations, net of income taxes | (0.8) | |||||||||||
Earnings from continuing operations | 16.2 | |||||||||||
Income tax expense | 3.7 | |||||||||||
Interest expense, net | 41.6 | |||||||||||
Non-operating income, net | (7.3) | |||||||||||
Operating profit | $ | 18.1 | $ | 67.5 | $ | (31.4) | 54.2 | |||||
Special items included in operating profit: | ||||||||||||
Integration and restructuring costs | 9.4 | ? | 5.0 | 14.4 | ||||||||
Severance and related benefit costs | 6.2 | 1.5 | 2.9 | 10.6 | ||||||||
Gain on sale of businesses and assets | (6.4) | ? | ? | (6.4) | ||||||||
Other | 4.5 | (0.9) | (0.1) | 3.5 | ||||||||
Total special items included in operating profit | 13.7 | 0.6 | 7.8 | 22.1 | ||||||||
Operating profit excluding special items (non-GAAP) | 31.8 | 68.1 | (23.6) | 76.3 | ||||||||
Non-operating income, net | 7.8 | 0.2 | (0.7) | 7.3 | ||||||||
Special item included in non-operating expense - gain on sale of business | (4.0) | ? | ? | (4.0) | ||||||||
Depreciation and amortization | 52.3 | 9.1 | 2.3 | 63.7 | ||||||||
Adjusted EBITDA (non-GAAP) | $ | 87.9 | $ | 77.4 | $ | (22.0) | $ | 143.3 | ||||
Segment operating margin | 3.2 | % | 31.5 | % | ||||||||
Segment adjusted EBITDA margin | 15.7 | % | 36.1 | % |
Table 3 | ||||||||||||||||||||
Meredith Corporation and Subsidiaries | ||||||||||||||||||||
Supplemental Disclosures | ||||||||||||||||||||
Earnings Outlook | ||||||||||||||||||||
Attributable | Attributable | Diluted | Diluted | |||||||||||||||||
(In millions, except per share data) | ||||||||||||||||||||
Year ending June 30, 2020 - Low Projection | ||||||||||||||||||||
Earnings from continuing operations | $ | 188 | $ | (79) | $ | 109 | 45.8 | $ | 2.38 | |||||||||||
Special items, net of tax 3 | 9 | |||||||||||||||||||
Earnings from continuing operations before special items | 197 | (79) | 118 | 45.8 | 2.58 | |||||||||||||||
Depreciation and amortization, net of tax | 152 | |||||||||||||||||||
Adjusted earnings (non-GAAP) 4 | $ | 349 | (86) | 263 | 45.8 | 5.75 | ||||||||||||||
Year ending June 30, 2020 - High Projection | ||||||||||||||||||||
Earnings from continuing operations | $ | 203 | (80) | 123 | 45.8 | 2.69 | ||||||||||||||
Special items, net of tax 3 | 9 | |||||||||||||||||||
Earnings from continuing operations before special items | 212 | (80) | 132 | 45.8 | 2.88 | |||||||||||||||
Depreciation and amortization, net of tax | 158 | |||||||||||||||||||
Adjusted earnings (non-GAAP) 4 | $ | 370 | (87) | 283 | 45.8 | 6.20 | ||||||||||||||
Quarter ending December 31, 2019 - Low Projection | ||||||||||||||||||||
Earnings from continuing operations | $ | 54 | (20) | 34 | 45.8 | 0.73 | ||||||||||||||
Depreciation and amortization, net of tax | 41 | |||||||||||||||||||
Adjusted earnings (non-GAAP) 4 | $ | 95 | (22) | 73 | 45.8 | 1.59 | ||||||||||||||
Quarter ending December 31, 2019 - High Projection | ||||||||||||||||||||
Earnings from continuing operations | $ | 60 | (21) | 39 | 45.8 | 0.86 | ||||||||||||||
Depreciation and amortization, net of tax | 41 | |||||||||||||||||||
Adjusted earnings (non-GAAP) 4 | $ | 101 | (22) | 79 | 45.8 | 1.72 |
1 | Includes preferred stock dividends, accretion of preferred stock, dividends on other securities, and undistributed earnings allocated to other securities to the extent that these instruments are not deemed to be dilutive | |||||||||||||||||||
2 | Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The dilutive effect of these instruments were computed using the two-class method | |||||||||||||||||||
3 | Special items represent those incurred in the first three months of fiscal 2020 as shown in Table 1. Actual results may include special items that have not yet occurred and are difficult to predict with reasonable certainty at this time | |||||||||||||||||||
4 | Adjusted earnings is defined as earnings from continuing operations before special items, depreciation, and amortization |
Table 4 | ||||||||||||||||
Meredith Corporation and Subsidiaries | ||||||||||||||||
Supplemental Disclosures | ||||||||||||||||
Projected Adjusted EBITDA | ||||||||||||||||
Projected adjusted EBITDA, which is reconciled to projected earnings from continuing operations in the following table, is defined as projected earnings from continuing operations before interest expense, income taxes, depreciation, amortization, and special items. | ||||||||||||||||
Quarter ending | Year ending June 30, 2020 | |||||||||||||||
Low | High | Low | High | |||||||||||||
(In millions) | ||||||||||||||||
Earnings from continuing operations | $ | 54 | $ | 60 | $ | 188 | $ | 203 | ||||||||
Special items, net of tax 1 | ? | ? | 9 | 9 | ||||||||||||
Income tax expense | 23 | 25 | 81 | 88 | ||||||||||||
Interest expense, net | 38 | 38 | 147 | 150 | ||||||||||||
Depreciation and amortization | 58 | 58 | 215 | 225 | ||||||||||||
Adjusted EBITDA (non-GAAP) | $ | 173 | $ | 181 | $ | 640 | $ | 675 |
1 | Special items for the year ending June 30, 2020, represent those incurred in the first three months of fiscal 2020, as shown in Table 1. Actual results may include special items that have not yet occurred and are difficult to predict with reasonable certainty at this time |
SOURCE Meredith Corporation
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