TEGNA’s ( TGNA Quick Quote TGNA - Free Report) fourth-quarter 2021 non-GAAP earnings of 57 cents per share beat the Zacks Consensus Estimate by 3.64% but declined 51% on a year-over-year basis. Revenues declined 17.4% year over year to $774.6 million and beat the consensus mark by 0.78%. The year-over-year upside was driven by record second-quarter growth in subscription revenues and advertising and marketing services revenues. Quarter in Detail
Advertising and Marketing Services (51.7% of revenues) revenues increased 13.7% year over year to $400.1 million, demonstrating significant broad-based strength across advertising categories.
Subscription (43.4% of revenues) revenues increased 7.1% year over year to $335.9 million due to rate increases. Political (3.4% of revenues) revenues were $26.6 million, down 89.9% year over year Other revenues (1.6% of revenues) were $12 million, up 52.7% year over year. Non-GAAP adjusted EBITDA decreased 42.8% year over year to $245.3 million. Adjusted EBITDA margin contracted to 31.7% from 45.7% in the year-ago period. Non-GAAP operating expenses (72.5% of revenues) of $561.4 million were up 3.3% year over year, predominantly driven by investments in growth initiatives such as Premion. Non-GAAP operating income plunged 45.9% year over year to $213.2 million. Operating margin contracted to 27.5% from 42% in the year-ago period. Balance Sheet & Cash Flow
As of Dec 31, 2021, total cash was $57 million compared with $51 million as of Sep 30, 2021.
Total debt was $3.3 billion and net leverage was 3.24 times as of Dec 31, 2021. Free cash flow in the fourth quarter was $189 million, better than $137 million reported in the previous quarter, driven by continued growth in subscription and advertising and marketing services revenues. Post Quarter Development
On Feb 22, Tegna entered into a definitive agreement to be acquired by an affiliate of Standard General and become a private company.
Per the deal, Tegna will be acquired by Standard General affiliate for $24 per share in cash. The transaction, which was unanimously approved by the Tegna Board, has an equity value of around $5.4 billion and an enterprise value of $8.6 billion, including the assumption of debt. With the acquisition in place, Tegna will become the United States’ largest minority-owned broadcast group. Zacks Rank & Stocks to Consider
TEGNA currently has a Zacks Rank #3 (Hold).
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