DallasNews Corporation Announces Third Quarter 2021 Financial Results
For the third quarter of 2021, on a non-GAAP basis,
Third Quarter Results
Total revenue was
Revenue from advertising and marketing services, including print and digital revenues, was
Circulation revenue was
Printing, distribution and other revenue decreased
Total consolidated operating expense in the third quarter of 2021, on a GAAP basis, was
In the third quarter of 2021, on a non-GAAP basis, adjusted operating expense was
As of
Non-GAAP Financial Measures
Reconciliations of operating loss to adjusted operating loss, total net operating revenue to adjusted operating revenue, and total operating costs and expense to adjusted operating expense are included in the exhibits to this release.
Financial Results Conference Call
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About
Statements in this communication concerning DallasNews Corporation’s business outlook or future economic performance, revenues, expenses, and other financial and non-financial items that are not historical facts, including statements about the Company’s expectations relating to the reverse stock split, are “forward-looking statements” as the term is defined under applicable federal securities laws. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those statements. Such risks, trends and uncertainties are, in most instances, beyond the Company’s control, and include changes in advertising demand and other economic conditions; consumers’ tastes; newsprint prices; program costs; labor relations; cybersecurity incidents; technological obsolescence; and the current and future impacts of the COVID-19 pandemic. Among other risks, there can be no guarantee that the board of directors will approve a quarterly dividend in future quarters; as well as other risks described in the Company’s Annual Report on Form 10-K and in the Company’s other public disclosures and filings with the
DallasNews Corporation and Subsidiaries
Consolidated Statements of Operations
| Three Months Ended |
Nine Months Ended |
|||||||||||||||
| In thousands, except share and per share amounts (unaudited) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Net Operating Revenue: | ||||||||||||||||
| Advertising and marketing services | $ | 18,101 | $ | 17,474 | $ | 53,471 | $ | 52,392 | ||||||||
| Circulation | 16,157 | 16,111 | 48,272 | 48,248 | ||||||||||||
| Printing, distribution and other | 4,053 | 4,157 | 12,051 | 12,860 | ||||||||||||
| Total net operating revenue | 38,311 | 37,742 | 113,794 | 113,500 | ||||||||||||
| Operating Costs and Expense: | ||||||||||||||||
| Employee compensation and benefits | 17,131 | 16,499 | 53,194 | 52,512 | ||||||||||||
| Other production, distribution and operating costs | 20,041 | 19,307 | 59,282 | 58,958 | ||||||||||||
| Newsprint, ink and other supplies | 2,439 | 2,476 | 7,158 | 8,018 | ||||||||||||
| Depreciation | 1,018 | 1,753 | 3,127 | 5,320 | ||||||||||||
| Amortization | — | 63 | 64 | 191 | ||||||||||||
| Loss on sale/disposal of assets, net | 30 | 61 | 29 | 56 | ||||||||||||
| Asset impairments | 232 | — | 232 | — | ||||||||||||
| Total operating costs and expense | 40,891 | 40,159 | 123,086 | 125,055 | ||||||||||||
| Operating loss | (2,580 | ) | (2,417 | ) | (9,292 | ) | (11,555 | ) | ||||||||
| Other income, net | 1,827 | 2,095 | 4,694 | 4,778 | ||||||||||||
| Loss Before Income Taxes | (753 | ) | (322 | ) | (4,598 | ) | (6,777 | ) | ||||||||
| Income tax benefit | (2,384 | ) | (224 | ) | (1,982 | ) | (1,644 | ) | ||||||||
| Net Income (Loss) | $ | 1,631 | $ | (98 | ) | $ | (2,616 | ) | $ | (5,133 | ) | |||||
| Per Share Basis | ||||||||||||||||
| Net income (loss) | ||||||||||||||||
| Basic and diluted (1) | $ | 0.30 | $ | (0.02 | ) | $ | (0.49 | ) | $ | (0.96 | ) | |||||
| Number of common shares used in the per share calculation: | ||||||||||||||||
| Basic and diluted (1) | 5,352,490 | 5,352,490 | 5,352,490 | 5,352,490 | ||||||||||||
(1) All share and per share amounts have been retroactively adjusted to reflect the one-for-four reverse stock split effective
DallasNews Corporation and Subsidiaries
Consolidated Balance Sheets
| In thousands (unaudited) | 2021 | 2020 | ||||
| Assets | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 34,659 | $ | 42,015 | ||
| Accounts receivable, net | 14,249 | 16,562 | ||||
| Notes receivable | 22,400 | 22,775 | ||||
| Other current assets | 7,417 | 6,754 | ||||
| Total current assets | 78,725 | 88,106 | ||||
| Property, plant and equipment, net | 9,208 | 11,959 | ||||
| Operating lease right-of-use assets | 18,219 | 20,406 | ||||
| Intangible assets, net | — | 64 | ||||
| Deferred income taxes, net | 102 | 76 | ||||
| Other assets | 2,203 | 2,604 | ||||
| Total assets | $ | 108,457 | $ | 123,215 | ||
| Liabilities and Shareholders’ Equity | ||||||
| Current liabilities: | ||||||
| Accounts payable | $ | 6,197 | $ | 7,759 | ||
| Accrued compensation and other current liabilities | 12,151 | 10,829 | ||||
| Contract liabilities | 12,139 | 12,896 | ||||
| Total current liabilities | 30,487 | 31,484 | ||||
| Long-term pension liabilities | 14,317 | 18,520 | ||||
| Long-term operating lease liabilities | 19,863 | 21,890 | ||||
| Other liabilities | 1,487 | 4,913 | ||||
| Total liabilities | 66,154 | 76,807 | ||||
| Total shareholders' equity | 42,303 | 46,408 | ||||
| Total liabilities and shareholders’ equity | $ | 108,457 | $ | 123,215 | ||
DallasNews Corporation - Non-GAAP Financial Measures
Reconciliation of Operating Loss to Adjusted Operating Loss
| Three Months Ended |
Nine Months Ended |
|||||||||||||||
| In thousands (unaudited) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Total net operating revenue | $ | 38,311 | $ | 37,742 | $ | 113,794 | $ | 113,500 | ||||||||
| Total operating costs and expense | 40,891 | 40,159 | 123,086 | 125,055 | ||||||||||||
| Operating Loss | $ | (2,580 | ) | $ | (2,417 | ) | $ | (9,292 | ) | $ | (11,555 | ) | ||||
| Total net operating revenue | $ | 38,311 | $ | 37,742 | $ | 113,794 | $ | 113,500 | ||||||||
| Addback: | ||||||||||||||||
| Advertising contra revenue | 6,596 | 3,012 | 18,908 | 5,400 | ||||||||||||
| Circulation contra revenue | 106 | 104 | 296 | 205 | ||||||||||||
| Adjusted Operating Revenue | $ | 45,013 | $ | 40,858 | $ | 132,998 | $ | 119,105 | ||||||||
| Total operating costs and expense | $ | 40,891 | $ | 40,159 | $ | 123,086 | $ | 125,055 | ||||||||
| Addback: | ||||||||||||||||
| Advertising contra expense | 6,596 | 3,012 | 18,908 | 5,400 | ||||||||||||
| Circulation contra expense | 106 | 104 | 296 | 205 | ||||||||||||
| Less: | ||||||||||||||||
| Depreciation | 1,018 | 1,753 | 3,127 | 5,320 | ||||||||||||
| Amortization | — | 63 | 64 | 191 | ||||||||||||
| Severance expense | 115 | 418 | 1,721 | 621 | ||||||||||||
| Loss on sale/disposal of assets, net | 30 | 61 | 29 | 56 | ||||||||||||
| Asset impairments | 232 | — | 232 | — | ||||||||||||
| Adjusted Operating Expense | $ | 46,198 | $ | 40,980 | $ | 137,117 | $ | 124,472 | ||||||||
| Adjusted operating revenue | $ | 45,013 | $ | 40,858 | $ | 132,998 | $ | 119,105 | ||||||||
| Adjusted operating expense | 46,198 | 40,980 | 137,117 | 124,472 | ||||||||||||
| Adjusted Operating Loss | $ | (1,185 | ) | $ | (122 | ) | $ | (4,119 | ) | $ | (5,367 | ) | ||||
The Company calculates adjusted operating income (loss) by adjusting operating income (loss) to exclude depreciation, amortization, severance expense, (gain) loss on sale/disposal of assets, and asset impairments (“adjusted operating income (loss)”). The Company believes that inclusion of certain noncash expenses and other items in the results makes for more difficult comparisons between years and with peer group companies.
The Company adopted the new revenue guidance (Topic 606) using the modified retrospective approach as of
Adjusted operating income (loss) is not a measure of financial performance under generally accepted accounting principles (“GAAP”). Management uses adjusted operating income (loss) and similar measures in internal analyses as supplemental measures of the Company’s financial performance, and for performance comparisons versus its peer group of companies. Management uses this non-GAAP financial measure for the purposes of evaluating consolidated Company performance. The Company therefore believes that the non-GAAP measure presented provides useful information to investors by allowing them to view the Company’s business through the eyes of management and the Board of Directors, facilitating comparison of results across historical periods and providing a focus on the underlying ongoing operating performance of its business. Adjusted operating income (loss) should not be considered in isolation or as a substitute for net income (loss), cash flows provided by (used for) operating activities or other comparable measures prepared in accordance with GAAP. Additionally, this non-GAAP measure may not be comparable to similarly-titled measures of other companies.
Contact:
214-977-8869
Source: DallasNews Corporation