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TEGNA’s (TGNA - Free Report) second-quarter 2021 non-GAAP earnings of 50 cents per share beat the Zacks Consensus Estimate by 2.04%. The bottom line surged 316.7% on a year-over-year basis.
Revenues increased 26.9% year over year to $732.9 million and beat the consensus mark by 0.33%. This year-over-year growth was driven by record second-quarter growth in subscription revenues and advertising and marketing services revenues.
Advertising and Marketing services (46.5% of revenues) revenues increased 48.8% year over year to $340.9 million.
Subscription (51.2% of revenues) revenues increased 16% year over year to $375.1 million due to rate increases.
Political (1.3% of revenues) revenues were $9.6 million, down 45.4% year over year
Other revenues (1% of revenues) were $7.4 million, down 2.2% year over year.
Non-GAAP adjusted EBITDA increased 83% year over year to $227.7 million. Adjusted EBITDA margin expanded 950 basis points (bps) to 31.1%. Adjusted EBITDA growth reflects strong operational performance of TEGNA’s stations.
Non-GAAP operating expenses (73.2% of revenues) of $536.8 million were up 10.2% year over year, primarily on account of higher programming expenses in relation to an increase in subscription revenues.
Non-GAAP operating income surged 116.8% year over year to $196.1 million. Operating margin expanded to 26.8% from 15.7% in the year-ago period.
Balance Sheet & Cash Flow
As of Jun 30, 2021, total cash was $57 million compared with $13 million as of Mar 31, 2021.
Total debt was $3.5 billion and net leverage was 3.64 times as of Jun 30, 2021.
Free cash flow in the second quarter was $91.9 million, down 4.4% year over year. Free cash flow was offset by approximately $118 million in income tax payments.
Guidance
For the third quarter of 2021, TEGNA expects GAAP revenues to increase in over low-single digit percent. Non-GAAP operating expenses are expected to increase in mid-to-high single digit percent.
For 2021, TEGNA expects net subscription profits to grow in the mid-to-high teens percentage range.
The company expects free cash flow as a percentage of 2020-2021 revenues of 21.5%- 22%.
The long-term earnings growth rate for Columbia Sportswear Company, Crocs and Boyd Gaming Corporation is currently pegged at 33.5%, 15%, and 40.7%, respectively.
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TEGNA (TGNA) Q2 Earnings Beat Estimates, Revenues Rise Y/Y
TEGNA’s (TGNA - Free Report) second-quarter 2021 non-GAAP earnings of 50 cents per share beat the Zacks Consensus Estimate by 2.04%. The bottom line surged 316.7% on a year-over-year basis.
Revenues increased 26.9% year over year to $732.9 million and beat the consensus mark by 0.33%. This year-over-year growth was driven by record second-quarter growth in subscription revenues and advertising and marketing services revenues.
TEGNA Inc. Price, Consensus and EPS Surprise
TEGNA Inc. price-consensus-eps-surprise-chart | TEGNA Inc. Quote
Quarter in Detail
Advertising and Marketing services (46.5% of revenues) revenues increased 48.8% year over year to $340.9 million.
Subscription (51.2% of revenues) revenues increased 16% year over year to $375.1 million due to rate increases.
Political (1.3% of revenues) revenues were $9.6 million, down 45.4% year over year
Other revenues (1% of revenues) were $7.4 million, down 2.2% year over year.
Non-GAAP adjusted EBITDA increased 83% year over year to $227.7 million. Adjusted EBITDA margin expanded 950 basis points (bps) to 31.1%. Adjusted EBITDA growth reflects strong operational performance of TEGNA’s stations.
Non-GAAP operating expenses (73.2% of revenues) of $536.8 million were up 10.2% year over year, primarily on account of higher programming expenses in relation to an increase in subscription revenues.
Non-GAAP operating income surged 116.8% year over year to $196.1 million. Operating margin expanded to 26.8% from 15.7% in the year-ago period.
Balance Sheet & Cash Flow
As of Jun 30, 2021, total cash was $57 million compared with $13 million as of Mar 31, 2021.
Total debt was $3.5 billion and net leverage was 3.64 times as of Jun 30, 2021.
Free cash flow in the second quarter was $91.9 million, down 4.4% year over year. Free cash flow was offset by approximately $118 million in income tax payments.
Guidance
For the third quarter of 2021, TEGNA expects GAAP revenues to increase in over low-single digit percent. Non-GAAP operating expenses are expected to increase in mid-to-high single digit percent.
For 2021, TEGNA expects net subscription profits to grow in the mid-to-high teens percentage range.
The company expects free cash flow as a percentage of 2020-2021 revenues of 21.5%- 22%.
Zacks Rank & Stocks to Consider
TEGNA currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader consumer discretionary sector are Columbia Sportswear Company (COLM - Free Report) , Crocs, Inc. (CROX - Free Report) and Boyd Gaming Corporation (BYD - Free Report) . All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The long-term earnings growth rate for Columbia Sportswear Company, Crocs and Boyd Gaming Corporation is currently pegged at 33.5%, 15%, and 40.7%, respectively.