Gannett (NYSE: GCI) reported Q4 EPS of $0.44, $0.02 worse than the analyst estimate of $0.46. Revenue for the quarter came in at $751.4 million versus the consensus estimate of $764.13 million.

• Operating revenues were $751.4 million, compared to $854.2 million in the fourth quarter of 2017.
• Unfavorable changes in foreign currency exchange rates negatively impacted revenues by $4.3 million.
• Same store, day adjusted operating revenues declined 8.6% year-over-year. Further adjusting for day trades as compared to the year-ago fourth quarter (one less Sunday, one more Monday), which impacts our print advertising and circulation revenues, the decline was 7.4%, an improvement of over 70 bps from the third quarter 2018 trend.
• Total digital revenues were $272.3 million, or approximately 36% of total revenue.
• Total digital advertising and marketing services revenues were $204.5 million, or 48% of total advertising and marketing services revenues.
• GAAP net loss was $14.2 million, including $56.3 million of after-tax restructuring, asset impairment charges and other costs.
• Adjusted EBITDA (3) totaled $111.0 million, compared to $132.7 million in the fourth quarter of 2017. Strong earnings growth at our ReachLocal segment was offset by lower revenues within our Publishing segment.

"We were pleased to see accelerated growth in our Publishing segment digital advertising and marketing services revenue in the quarter, driven by strong national advertising across the USA TODAY NETWORK," said Robert J. Dickey, president and chief executive officer. "Additionally, our ReachLocal segment executed solid revenue performance and margin expansion, fueled by our recent WordStream acquisition."

Dickey continued, "During 2018, our B2B organization implemented a strategic sales transformation that has positioned us well for future expansion and our B2C organization delivered strong audience gains while also winning three Pulitzer prizes. As we look forward to 2019, we remain committed to producing award-winning journalism, driving growth across our digital businesses to reach a key milestone of more than half our advertising revenues from digital sources and continuing our cost rationalization efforts to support our transformation."

GUIDANCE:

Gannett sees FY2019 revenue of $2.74-2.81 billion, versus the consensus of $2.86 billion.

• Consolidated Adjusted EBITDA of $285-295 million, including roughly $8 million of one-time costs associated with the CEO transition.
• Capital expenditures of $50-60 million, excluding real estate projects.
• Depreciation and amortization of $150-160 million, excluding accelerated depreciation related to facility consolidations.
• The non-operating cost associated with our pension plans, recorded in other non-operating items, is currently estimated to be between $20-25 million as compared to a credit of $5.0 million in 2018.
• A non-GAAP effective tax rate of 28-30%. (3)

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