April 29, 2019
A. H. Belo Corporation Announces First Quarter 2019 Financial Results
DALLAS – A. H. Belo Corporation (NYSE: AHC) today reported a first quarter 2019 net loss of $3.0 million, or $(0.14) per share. In the first quarter of 2018, the Company reported a net loss of $4.0 million, or $(0.19) per share.
For the first quarter of 2019, on a non-GAAP basis, A. H. Belo reported operating loss adjusted for certain items ("adjusted operating loss") of $0.9 million, an improvement of $2.6 million, or 74.7 percent, compared to the first quarter of 2018.
Robert W. Decherd, chairman, president and Chief Executive Officer, said, “The Company made notable progress during the first quarter by narrowing our net loss and concentrating on a range of initiatives designed to build a strong digital business.
"There were encouraging signs at The Dallas Morning News during the first quarter, particularly the improvement in run-of-press print advertising. The News continues to see sequential growth in digital subscription volume and pricing, albeit at levels that must continue to grow in order to fully implement our digital-first strategy. News and editorial content of the newspaper has been highly-impactful during the first four months of the year.
"Changes implemented by The News in its commercial printing business during the quarter have matched our expectations for margin improvement and re-sizing the business to focus on a few, major customers.
"At Belo + Company, timing of sales and fulfillment of contracts were the focus during the first quarter, along with the bolt-on acquisition of a small creative agency in Tulsa, Oklahoma, acquired on April 1st that will complete Belo + Company's suite of services and support client activities now and into the future. We are also benefiting from the presence of new leaders in both the sales and agency channels."
First Quarter Results
Total revenue was $46.6 million in the first quarter of 2019, a decrease of $2.9 million, or 5.8 percent, when compared to the first quarter of 2018.
Revenue from advertising and marketing services, including print and digital revenues, was $24.0 million in the first quarter of 2019, a decrease of $1.7 million, or 6.6 percent, when compared to the $25.7 million reported for the first quarter of 2018.
Circulation revenue was $17.3 million, a decrease of $0.5 million, or 2.7 percent, when compared to the first quarter of 2018. The decline was primarily due to a decrease in home delivery and single copy volumes, partially offset by rate increases and an increase of $0.3 million, or 33.6 percent, in digital-only subscription revenue.
Printing, distribution and other revenue decreased $0.7 million, or 11.6 percent, to $5.3 million, primarily due to a reduction in brokered and commercial printing.
Total consolidated operating expense in the first quarter of 2019, on a GAAP basis, was $50.6 million, a decrease of $5.0 million, or 9.0 percent, compared to the first quarter of 2018. The improvement was primarily due to decreases of $3.5 million in employee compensation and benefits expense, $0.6 million in newsprint, ink and other supplies expense, and $0.5 million in distribution expense.
In the first quarter of 2019, on a non-GAAP basis, adjusted operating expense was $50.3 million, an improvement of $5.7 million, or 10.2 percent, compared to $56.0 million of adjusted operating expense in the first quarter of 2018. The improvement is primarily due to expense decreases in employee compensation and benefits, newsprint, distribution, and reductions from continued management of discretionary spending.
As of March 31, 2019, the Company had 918 employees, a decrease of 128, or 12.2 percent, compared to the prior year period. Cash and cash equivalents were $50.3 million and the Company had no debt.
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
A. H. Belo Corporation will conduct a conference call on Tuesday, April 30, 2019, at 9:00 a.m. CDT to discuss financial results. The conference call will be available via webcast by accessing the Company’s website at www.ahbelo.com/invest. An archive of the webcast will be available at www.ahbelo.com in the Investor Relations section.
To access the listen-only conference call, dial 1-800-230-1951 (USA) or 612-288-0340 (International). A replay line will be available at 1-800-475-6701 (USA) or 320-365-3844 (International) from 11:00 a.m. CDT on April 30, 2019 until 11:59 p.m. CDT on May 7, 2019. The access code for the replay is 466835.
About A. H. Belo Corporation
A. H. Belo Corporation is the leading local news and information publishing company in Texas with commercial printing, distribution and direct mail capabilities, as well as a presence in emerging media and digital marketing. While focusing on extending the Company’s media platforms, A. H. Belo delivers news and information in innovative ways to a broad range of audiences with diverse interests and lifestyles. For additional information, visit www.ahbelo.com or email email@example.com.
Statements in this communication concerning A. H. Belo Corporation’s business outlook or future economic performance, anticipated profitability, revenues, expenses, dividends, capital expenditures, investments, dispositions, impairments, business initiatives, acquisitions, pension plan contributions and obligations, real estate sales, working capital, future financings and other financial and non-financial items that are not historical facts, 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; technology obsolescence; 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 Securities and Exchange Commission. Forward-looking statements, which are as of the date of this filing, are not updated to reflect events or circumstances after the date of the statement.