New Media Investment Group (NEWM) Misses Q2 EPS by 4c on Revenues of $388.8M

New Media Investment Group (NYSE: NEWM) reported Q2 EPS of $0.20, $0.04 worse than the analyst estimate of $0.24. Revenue for the quarter came in at $388.8 million.

Second Quarter 2018 Financial Summary

• New Media declares a cash dividend of $0.37 per common share for the second quarter of 2018
• Total revenues of $388.8 million, an increase of 20.4% to prior year on a reported basis, and down 4.9% on an organic same store basis excluding, for comparability, the impact of ASC Topic 606○
• Digital revenue of $45.6 million, an increase of 31.4% to prior year on a reported basis
• Operating income of $23.3 million
• Net income of $11.7 million
• As Adjusted EBITDA of $48.8 million*
• Free Cash Flow of $35.7 million*
• Liquidity, consisting of cash on the balance sheet and undrawn revolver, of $113.3 million at the close of Q2 2018

“The second quarter performed well across many areas of our business plan,” said Michael E. Reed, New Media President and Chief Executive Officer. “We had a good revenue quarter, a very strong acquisition quarter, and our new business initiatives, UpCurve, GateHouse Live and Promotions, performed extremely well. On the inorganic growth side, we closed four transactions in our acquisition pipeline that totaled nearly $118 million in purchase price and our pipeline remains strong. We are happy to report that our board declared a quarterly dividend of $0.37 per share for the second quarter.”

“We are thrilled with the exceptional growth trends achieved within our business initiatives. UpCurve revenue grew 47.2% over prior year, excluding the impact of ASC 606. ThriveHive had significant wins within the automotive customer vertical, accelerated by our recent acquisition of Online Automotive Solutions and its tech-enabled video and data products. On the events front, both GateHouse Live and Promotions had revenue growth exceeding 65% over the prior year. May and June are very busy months for us, especially for our Best of Preps events, which celebrate outstanding high school athletes.”

“With our four newspaper acquisitions closed in the quarter, our total acquisitions for the year are now in excess of $133 million. These new markets are all great additions to our portfolio, are within our acquisition criteria and valuation expectations, and are expected to drive further growth potential for our new business initiatives.”

“In April, we completed an equity offering that raised over $110 million in net proceeds, which allowed us to ensure the timely closing of the deals just mentioned as well as explore future deals in our pipeline. Our integration team has had a busy year ensuring that these deals are quickly brought into the portfolio and aligned with our best practices. We closed the quarter with $113.3 million in liquidity which positions us well to take advantage of future deals in the pipeline. The continued strength of all facets of our strategy has us optimistic about our ability to generate continued strong returns for shareholders over the second half of the year.”

For earnings history and earnings-related data on New Media Investment Group (NEWM) click here.

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