Gannett Executives Speak at the UBS Media and Communications Conference
McLEAN, VA – Gannett executives at the UBS Media and Communications Conference today reported on the company’s strategic efforts, digital segment, content initiatives, and the company’s outlook for 2009.
Craig A. Dubow, chairman, president and chief executive officer of Gannett Co., Inc. (NYSE: GCI) discussed the impact of the difficult economic environment but stressed: “Our philosophy and operating premise is that we have been in bad times before and we know how to manage through them. We are doing that aggressively now, while continuing to execute on our strategic plan. We believe these steps will prepare us for the return of the economy.
“Central to these efforts,” Dubow said, “is the idea that consumers will always seek relevant content and advertisers need to connect to those consumers. That connection – content to consumers and consumers to advertisers – has been a cornerstone of Gannett’s success for over 100 hundred years and is the core of our current strategic plan.”
Chief Digital Officer Chris Saridakis outlined the progress of Gannett’s digital strategy, including the growth of a digital marketing business around Point Roll, ShopLocal and the newest acquisition, Ripple6. “This suite of companies can provide a full range of shopping solutions for retailers, while enhancing the online experience for consumers. These companies, combined with our growing number of content verticals, are allowing us to create new ways to monetize social media.”
Gracia Martore, executive vice president and chief financial officer, discussed the quarter’s results to date, outlined the company’s ongoing efforts at expense control, including newsprint costs, and discussed the company’s 2009 outlook.
Speeches by the Gannett executives will be available by Webcast for 30 days at www.gannett.com.
Attached to this release and posted on the company’s Web site under Investor Relations are Gannett’s operating assumptions for 2009.
Gannett Co., Inc. is a leading international news and information company that publishes 85 daily newspapers in the USA, including USA TODAY, the nation’s largest-selling daily newspaper. The company also owns nearly 900 non-daily publications in the USA and USA WEEKEND, a weekly newspaper magazine. Gannett subsidiary Newsquest is the United Kingdom’s second largest regional newspaper company. Newsquest publishes 17 daily paid-for titles, approximately 300 weekly newspapers, magazines and trade publications, and a network of award-winning Web sites. Gannett also operates 23 television stations in the United States and is an Internet leader with sites sponsored by its TV stations and newspapers including USATODAY.com, one of the most popular news sites on the Web.
Certain statements in this press release, including the operating assumptions for 2009, may be deemed “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained in this press release, including the operating assumptions, are subject to a number of risks and uncertainties that could adversely affect the company’s ability to obtain these results include, without limitation, the following factors: (a) increased consolidation among major retailers or other events which may adversely affect business operations of major customers and depress the level of local and national advertising; (b) a further economic downturn in some or all of the Company’s principal publishing or broadcasting markets leading to decreased circulation or local, national or classified advertising; (c) a decline in general publishing readership and/or advertiser patterns as a result of competitive alternative media or other factors; (d) an increase in newsprint or syndication programming costs over the levels anticipated; (e) labor disputes which may cause revenue declines or increased labor costs; (f) acquisitions of new businesses or dispositions of existing businesses; (g) a decline in viewership of major networks and local news programming; (h) rapid technological changes and frequent new product introductions prevalent in electronic publishing; (i) an increase in interest rates; (j) a weakening in the British pound to U.S. dollar exchange rate; (k) volatility in financial and credit markets which could affect the value of retirement plan assets and the Company’s ability to raise funds through debt or equity issuances; (l) changes in the regulatory environment; (m) an other than temporary decline in operating results and enterprise value that could lead to further non-cash goodwill, other intangible asset or property, plant and equipment impairment charges; and (n) general economic, political and business conditions.
Gannett is not responsible for updating the information contained in these assumptions beyond the published date, or for changes made to the assumptions by wire services, Internet service providers or other media.
For investor inquiries, contact:
Director, Investor Relations
For media inquiries, contact:
Vice President of Corporate Communications
GANNETT CO., INC.
OPERATING ASSUMPTIONS – 2009
(Based on 52 weeks in 2008 and 2009)
NEWSPAPERS (Excluding USA TODAY, USA Weekend and Newsquest)
1. Newsprint costs will decline in the mid teens.
B. Other Expenses
1. Total headcount will be down in the low teens.
2. All other costs will decrease in the mid single digits.
NEWSQUEST (in Sterling)
A. Total headcount will be down in the mid teens.
B. Newsprint costs will decline in the low teens. Newsprint
prices will increase in the low double digits.
1. Rates will be up in the mid single digit range.
B. Other Expenses
1. Total headcount will be down in the mid single digits.
BROADCAST (Ex. Captivate)
A. Costs are expected to be down mid single digits.
B. Total headcount will be down in the mid to high single digits.
CONSOLIDATED GANNETT (Including Acquisitions)
A. Capital Expenditures
1. 2009 Plan $148,000,000
2. 2008 Estimate $160,000,000 – $170,000,000
1. 2009 Plan $241,000,000
2. 2008 Estimate $244,000,000
C. Amortization of Intangibles (Goodwill and Other)
1. 2009 Plan $36,100,000
2. 2008 Estimate $31,900,000
D. Benefit Costs
1. Pension expense will be up over 2008.
2. Health care costs will be about flat with 2008.
E. Interest Expense
We expect our debt at the beginning of the year to be about $3.8 billion.
For budget purposes only, we have assumed that all of our free cash
flow will be used to pay down debt.
F. Tax Rate
The tax rate for 2009 will be approximately 36.0%, depending on the mix of earnings.