Gannett, the owner of USA TODAY, reported a year-over-year dip in fourth-quarter revenue Thursday but highlighted its growing digital subscriptions.
The company reported a net loss of $22.4 million for the quarter, compared with a net loss of $122.2 million in the same period a year prior.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 22.5% in the quarter to $115.4 million.
Overall quarterly revenue fell 5.6% to $826.5 million. On a comparable basis, circulation revenue dipped 9.2% to $307.3 million while advertising and marketing services revenue fell 6.6%.
Digital-only circulation revenue of $27.6 million was up 25.5% compared to the prior-year quarter.
Digital subscriptions up
The company has turned its attention to growing digital subscriptions as the journalism industry faces declining print revenue.
Gannett Chairman and CEO Michael Reed said in early 2021 that the company aimed to secure 10 million digital subscriptions within five years. USA TODAY, its flagship brand, launched paid digital access for premium content in July 2021.
Digital-only paid subscribers grew 49% and surpassed 1.6 million in the latest quarter, resulting in $27.6 million from digital-only circulation revenue. The company fell just short of the 1.65 million digital subscriptions Reed had forecasted in November.
Reed said he expects the company to surpass 2 million paid digital subscribers in 2022 and to grow at approximately a 40% annual rate through 2025.
Looking forward
Gannett repaid $57.5 million in debt in the quarter and ended the year with approximately $131 million in cash.
For 2021, total digital revenues surpassed $1 billion, 32% of total revenues and up 9% year-over-year.
The company expects 2022 free cash flow to nearly double from 2021 and to grow at a 40% compounded annual growth rate through 2025 as it gains more digital subscribers.
In addition to allowing Gannett to further invest in growth segments such as content and marketing, Reed said, "The anticipated significant growth in free cash flow is also expected to allow us to continue our aggressive debt repayment strategy.”
Looking forward, Reed said, “Considering our liquidity position, lower leverage profile and our recently announced $100 million stock repurchase program, along with expected increased free cash flows, we believe we are well-positioned to maximize shareholder returns."
Gannett is set to host an earnings call Thursday at 8:30 a.m. ET.
Bailey is a travel reporter based in Las Vegas. You can reach her at [email protected] and follow her on Twitter @bailey_schulz.
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