GCI - Earnings call transcript Q1 2019

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Operator

Good day, ladies and gentlemen. And welcome to the First Quarter Gannett Earnings Conference Call.

As a reminder, today's conference is being recorded. I would now like to introduce your host for today's conference call, Ms. Stacy Cunningham, Vice President of Financial Planning and Investor Relations. Ms. begin. may you Cunningham,

Stacy Cunningham

morning, conference welcome call. Good quarter Gannett's XXXX earnings everyone. you. to And first Thank

As recorded and reminder, webcast. a this call is being

Chief Interim Chief from Dickey, Officer and Chief Joining are Officer. Operating Officer; Executive Legal and Financial Wall, today Engel, Officer; Barbara us and Chief Ali Gannett President Bob

risk would cause to The your forward-looking financial results press release. attention in we materially contents statements our Safe Before from our may like statements. of begin, to Harbor factors provision to differ our identifies Safe I actual for call that Harbor provision the results forward-looking

For financial the our during management's commentary affect financial may detailed XXXX SEC a to release this our call, press our which more GAAP Also our of and description risk posted the factors XX-K. have results in refer filings, metrics of will and results, be results please release, including Reconciliations tables that to reported Investor Form include website. between press non-GAAP we can results non-GAAP our for Relations found our been our financial measures.

these way, like call turn the I'd to out the Bob. With to over now of formalities

Bob Dickey

Stacy. and Good for you us Thanks, thank today. joining morning

WHITE of and discuss investment during you all quarter, independent to director the Before of card voted, your and performance we all your proxy haven't the this nominees. still for protect for I like value our in to would the we proxy the for season. if of shareholders employees Gannett's support thank And you vote X encourage Gannett

important. vote is Your

results said, and comment this don't and move over call. financial on refer I’m press conclude topics, increase to turn who over first first is proxy our organizations. to on to I in quarter XX% then consumer you will the performance our cost contest the marketing recent in pleased our presentations with better-than-expected financial circulation. with further we and on by we're any results we’ve on results. advertising EBITDA today we’ve releases from driven adjusted management. and proxy Overall, XXXX our information our first that further will delivered it that, very to to would the focus With and quarter quarter issued highlights disciplined going a print intend about related weeks. And That detailed For public Ali, solutions I our

and ReachLocal We in also and we believe March experienced future digital contribute both publishing in and new to in will April robust marketing segments services quarters. acquisition client advertising revenues improved that our

Importantly, growth, led as we're making strong evidenced are model, value. digital-only to drive confident our shareholder significant progress product digitally towards our and a by revenue subscriber transition which we will

were Looking held and Publishing segment, year-over-year Easter. trends despite print the the at better-than-expected later advertising steady

stronger Specifically, most of our national across retail business account. our was top

halfway XXX,XXX. than On next to years. side, year-over-year volumes X subscriber which paid subscriber to the circulation remain to we grew More goal, XX% in on two the track our million digital-only reach

also price We single copy improvements in and increases. reflecting expected in USA local both volumes in markets, at and revenues TODAY the quarter had some our stronger than

strong and with our revenues double-digit results deliver to digital continue Publishing weaker USA the with premium channel national channels. in led Newsquest, single by segment gains TODAY combined syndication with media year-over-year digital improved we flat for national and revenue quarter. total revenues solid both Our Of strong growth domestic in digital strong growth market. achieve our national offset from trends media marketing to and trends This in mix revenue from results the and the programmatic services local advertising copy our note, showed sales trends

revenue strategy performance point environment. is despite We USA that are flagship encouraged and by digital proof our industry the the transformation property, our working strong is of challenging another TODAY's

higher America. the and North The larger our per offset slower-than-expected due driven both organization of new reflect markets our leading margins, continued our WordStream, slow reflecting organizations by adjusted lower we of year-over-year of accounts segment, in quarter a client by lower as addition slightly market and to being into ReachLocal's -- local growth understaffed of in disruption and WordStream this churned counts revenues EBITDA acquisition couple as across some in from believe temporary the that well client. the February. sale revenue sales client ReachLocal January and the XXXX. in local average ReachLocal softness activity sales international counts seasonally up were of certain slightly months Overall, the our reported at core our client and Turning addition was We to operations

client Importantly, in growth new robust indicator April, we which more and March are robust leading future already in of a quarters. acquisitions delivering is

marketing As new laser organization quarter, packages, sales acquiring digital is continuing the sales last focused marketing we mentioned existing retaining client, tools to conducting client, services solutions and on improved training. and

our Given we deliver local sellers with was the evident a that specialist in call can team DMS metros sales ensure formed the expertise ad community March solutions marketing the in newly reorganization breadth competitive advantage. sales growth delivering sales strong teams retail as Progress our of have shown centers our churn. the digital in sales to provides added products, quarter previously and reducing progress client with mentioned, and a

pack will management management across and review clients tracking, product the second a design team test and LOCALiQ lead quarter, several and listings markets, offering to forward starter graphic Looking launch our services.

DMS starter currently an aligns of these to DMS at driving easy existing not our who target strategy which directly using our services, packs products client of -- are will We penetration as our our our products. to drive introduction deeper clients

award marketing an our earlier solutions AdExchanger. to from highlight this want week for received organization, Lastly, I

as audiences. the artificial against for local our use deep elements a platform best best our an vision in The data going big determine tool. which up and to the in-house We design nation businesses our ad this of all clients the product Product marketing with of Kris provides thousands be advertising hard continue our inform Chief are honor received and marketing in their the advantage. by an to and learning technologies publisher is perform are We're Barton, a intelligence competitive names using industry. very platform, to We Grandstand creative give Grandstand strategies data. to an computer use latest with of to developed to teams local his recognized across innovative work to further accessed Officer with excited

visitors peer to In delivered Turning X% of monthly growth measured a ahead in quarter, we and our organization, the our line up comScore audience quarter year-over-year consumer our totaled continued set. with revenues XXX unique strong million, by with trends. expectation as first in

back twice a on with than week, goals progress make loyalty readers to XX%. a growing to continue We our coming percent of more

programming is driving we new allows mobile increased elated a performance stories across depth quarter, storylines, on template our editors of growth the design launched increased video, to We delivered this cross-platform product already roll is our that video new with our on dig revenues video out strong the platforms. affiliate During deeper driving on also network. and and by that up pages, network-wide engagement year-over-year users across feature XX% mobile visit due particularly responsive to increased strong highlighted

partnership by syndication new our Our quarter, strong solid from and with revenues, also our MSN. with driven deal XX% which the in continued results Yahoo! video by results grew are enhancing

We XX% within of metering we in do content our video points a paid production in pleased robust results. including a our show also rates, markets remain variety group time and our same growth on local digital-only form a growth We digital-only best drove in revenue studio subscriber continued to to subscribers, to launched our ventures continuing growth in price Blue that to recently We're short focused positive our Chair not methods and increasing video through while tightening digital-only meters. base which markets, subscription accelerate in report further Productions, test in deploying paid tests practices resulted I’m at driving tactics, rapidly content. growth again year-over-year. ending the similar quickly different franchise

dynamic more first quarter launched and and ad Our based product had to behavioral April, adding and a data. meters paid messaging a a in several piloting enhancements local in developing new drive application USA growth, puzzle crossword a team user markets that personalized free digital-only products subscriber TODAY including paid delivering on app busy

As were But last pricing expected, subscriber our projection. our we revenue year's saw as volumes of access action. declines ahead in full a slightly overall, we cycle

two committed continue the our customer more will ahead. first-place that content to And for finally subscribers consumer to that play news were and series, in communities National news steadfastly USA resonates the Nashville, winners. pleased role pricing Milwaukee, newsrooms Palm a our congratulate loyal categories source and focus we and to believe their service TODAY trusted and strong with the every and also most information market science the we I’m in the top XX were We recognized important look finishes Headliners while on organization, program. had journalists health, We as retaining modest Awards we’re among six Springs and Detroit, communities, in serve. day Redding the media our of actions in remaining media across

closure our -- of key signed that enhanced of and Well outsource our protect shareholders. investment and efficiently as our We journalism. a to our remain Across areas running being solutions, driving more possible value restructured returns enable coverage. we In are operations time, continued shareholders. confident while some and our the quarter, as enable same four us that additional overall function, to growth production best-in-class on we to announced continued deliver in and in our and will state newsrooms thoughtful throughout newsrooms marketing of technology growth manage mindful holistically the some investments to focused investment to the margins journalism, at first sites contract organization, for

cost to critical While are these future efforts our of difficult, they’re company. the

I as excited the coming be to a truly to thank excited and strong and execution this all CEO continued solution It's marketplace. me our will I’m let Gannett I turn Gannett years. in in Ali, plan. about serve potential I'm delivered assets, company the the earnings mid the confident all take of achieved portfolio that over cannot significant including I to in employees have company's turn creation the since and organization. of our key prouder continued set out call. contributed progress what our spin marketing transformation Ali. ahead unique be accomplishments the last at been And and digital the that, of follow value Gannett's a Gannett. lies to call an team I to milestones growth honor shareholders as success great to through performance, that and With who the and strongest XXXX. it for strategic have to and Gannett I’m believe operational have digital of over Before my moment the off of We’ve across this number financial want the

Ali Engel

one the had more everyone. Thank In Monday and therefore start. revenues print you, have One day good the benefited These one in to the and first less Sunday XXXX. Bob, we metrics day to quarter item adjusted trades circulation housekeeping for of quarter compared provided and and trades. morning, quick as we our advertising XXXX

in As last million year-ago. challenging the $XXX by for secular XX% partially expense the with Consolidated the the subscriber a manage in and will year-over-year a represented first We these we mentioned and trades addition WordStream advertising million cost adjusted and XX% gains closely. acquisition total decline $XXX The impact lower in Total basis, pleased from was revenue have of digital a quarter. offset decline the in circulation, total to strong trends reflects both savings cost, up revenue, declined the up negative the as digital-only first XXXX. $XXX continued same-store quarter, revenues million our revenues revenue were Further particularly were payroll print adjusting X% of and third of benefits in WordStream most quarter. of growth. EBITDA paid compared by categories, we XX% across driven revenues On strong the X.X%. in quarter, quarter day the trades, day

Our basis points margins XXX adjusted X.X%. EBITDA the grew to quarter in

started started in fell BXB as total same-store retirement as first quarter quarter early last of the well efforts reorganization expenses Specifically, January. from that program XX% year-over-year, last approximately the April operating benefit that reflecting the

the to as were offset prices. higher quarter Newsprint slightly expenses volume fell enough more than in reductions

was to a quarter basis. same-store Further decline Turning first the the X.X% segment, revenues were adjusting Publishing for down the on trades, XX.X%. day

X.X% basis. print day a QX Bob a year-ago. XXXX to advertising slightly despite trends services trend, of Easter services year-over-year. in As XXXX from consistent slowdown up on which a March same-store X.X% April year-over-year. a our which adjusted did digital revenues, the marketing expectations see is late advertising holiday advertising decline quarter, shifted XX.X% the ahead were be and Digital mentioned, same-store category, with down This We for fell into revenues our best-performing marketing continue

than counts from These reorganization. average activity, acquisition client lower combination more counts. gains advertising a period reflecting slower and lower revenue slower As our client for or seasonally some of sales impact in client offset continued per

these expect same-store stronger in the As by successful year March discussed April, being basis we've X.X% period offset revenues in seen digital client DMS meaningful including of key And improvement reflecting we March trends in our and partially revenue a Within metric progresses. continued local wins. on strength as media, growth weaker most national. declined

On the and CPMs. local some shift we a digital our marketing marketing, continue see performance-based side, towards solutions on downward to pressure like

results both revenues Additionally, further serve to subscribers. were trusted aggressively on both programmatic page a views with national, growth lower services, our continue to decision impact and and financial a strongest local XX% strong continues to national revenues by as digital-only sold At to from expected, we our and see paid strong meters saw year-over-year, solid categories therefore Gannett as why up modest we our driven in were programmatic our comprehensive channels businesses. very automotive and partner and These to marketing illustrating direct results more telecommunications. grow

expected, overall results services impact quarter. negatively marketing As digital and to with to the trends advertising continued digital similar our classifieds fourth

in pricing with classifieds. part adjusted actions digital circulation, volume at by the in our advertising exclude to TODAY our local for in only strong initiatives, we in growth revenues. trends better-than-expected led starting same-store down X.X% premium X.X% see year-over-year. late to and QX subscriber year's declined of did outperformance. some offset a USA local combined were services you the day were revenue several our We full and access last edition marketing saw single cycle pricing to And digital-only segment copy basis markets, and U.S If revenue Publishing the which both impact to same-store on Switching markets, trades quarter. digital revenues

approximately Bob As up quarter, XX% subscriber digital-only to mentioned, in the growth year-over-year volume paid remains robust XXX,XXX.

new digital As improved in we solid new our revenues targeting digital-only move their saw up to subscribers monthly are with growth we also subscribers, aggressively rate higher at our introductory rates. retention

ReachLocal Turning segment. our to

approximately by businesses quarter driven our offset The client of WordStream million, was the and X% the $XX in addition international the our sale operations. by of of lower international streamlining the annual which revenues to In early, couple we April dollars our $X quarterly focus a Brazilian first up counts. on America year-over-year and strategy divestiture adjusted more operations North and of announced revenue EBITDA. Continuing represents million certain in million operations

of teams in start were and forward, and will same-store Going sales client a the headed comprised U.S., On there year. clients slower-than-expected segment Canada., North Zealand. early presence larger quarter the ReachLocal ReachLocal as declined X% churned the Australia America New our into and acquisition be revenues new regional were that a understaffed the was couple the basis, of

slightly. past that Digital America the XX% four as revenue and as for improved local WordStream Total which in quarter lower advertising; by that the in counts of search and average and new social to and revenue products to and revenues; grew per were although gains acquisition March client Gannett setting due balance pleased the we years QX well advertising, in markets XXXX. client report down up quarter advertising such strongest X% our training are our the the North driven growth, was We monthly in client as advertising, include engine SweetIQ. budget new display in saw up

counts down of by quarter, XX% in North were America our acquisition. base Our XXX% in client an year-over-year. organic Driven quarter XX,XXX the grew basis, to our subscription due the X%. the client to up On addition revenues the WordStream, grew year-over-year WordStream

delivered feed the Google meet X% E-commerce per merchandise as in WordStream numerous offering, average excluding Shopping is initiatives placements. with clients Our new WordStream continues $X,XXX revenue and to a ad on client totaled fast local earlier progressing new continued expectations year-over-year X% the a in product improvement roughly and quarter, revenue from for expanding to quarter. is grew addition planned. expected. growing and segment a WordStream margins allows our to This our and product the ReachLocal subscription the average per first we Adjusted into launched client. QX, up and successfully improvement at Early than development team revenue in businesses opportunity with Google which identified operational a reflects segment Shopping showed product for X% inventory year-ago. the of WordStream EBITDA higher and

growth marketing and XXXX line for a our priority in our quarter, top result, last sales revenue additional on as focus QX by resources. was mentioned As to margin impacted and investment is

of million Our after-tax for impairment restructuring, $XX cost. reflecting other million charges, quarter GAAP was $XX net loss the asset and

balance debt, our of million liability the ended revolver. quarter including Turning drawn portion million on convertible the our debt We in the million $XXX sheet. with to $XXX and $XXX

cash supporting resulting Our Capital of end investments shares for dividends. repurchased expenditures facility were debt development real of to quarter our first as ongoing $XX projects as was totaled the million digital balance reflecting this well There quarter in at the in the and consolidations and net product paid $XX no million transactions. quarter related $XX $XXX we million estate million.

any full-year now, our provided we not you. We questions. that Thank And are operator, in open line we the making for February. adjustments guidance will to

Operator

Instructions] with Thank from question you. Stephens. comes Kyle Our [Operator first Evans

line Your is open.

Kyle Evans

Hi. Good morning.

Ali Engel

Hey, Kyle.

Kyle Evans

by search start update an I Bob, maybe on would happy question. like congratulating my first on And CEO the a to is retirement. note, related

Bob Dickey

Kyle. Sure,

your years. at always you Stephens, enjoyed team working First much all, and so with of appreciate the support I thanks. And the have over

and couple candidates selection will they’re stated go to the The we’ve the working We’ve months In pretty selected weeks of well thereafter. took good hopefully publicly is consistent. happen firm. Operating We’ve that search but leading been not search, As a a continuing a and the process. very, the very had CEO role Board potential shortly through on to a a our decision interim, it has Wall a for list Chief relates us. annual really been prior Officer ago, Barbara away, meeting which out that’s couple Interim to

If key Barbara, years, will will do be a And and new she's on very, needed, CEO the over future partner few consultant months You as stay I well. I transition the next with to know very with to nicely. him. go mine. for a that Board business been CEO XX Gannett the the there of as plan comfortable And for very

Kyle Evans

questions trends underlying the to A circulation. volume circulation. ask obligatory Great. on I'm pricing going few

will out give you expect could you on or that give to get you take XXXX maybe then the kind price? kind where but of way, We for outlook of the a as outlook talk those, there of longer-term and about even

Bob Dickey

Sure, Kyle.

the our think that better cycled was as that one slightly thing were price volumes through had I we we we’ve increases. projected noted than

that always color. Kyle, Maribel you give we going right think maintain but I to for think that going is -- your ready little let because a So to now can we Maribel I'm that, question, I'm more

Kyle Evans

Great.

Maribel Perez Wadsworth

Good thank And always questions. morning, Kyle. these you again raising for

some in as have, our quarter. Bob in moderation declines said, seen the We volume

that We pricing had our aggressive low in yields continued in XXXX. in the range, were but high are strong pricing and XXXX range. we down more teen begun double-digit remain cycling at the in volumes End

working well. part that So is

to already we having targeting customers those are range in the approach end rate on where and subscribers pricing approach that are our for on think we XXXX our instead I you rate remember end who who higher believe spoke are into excluding the premium paying lower are content who it's year. of spectrum. those adjusted of more We to a strategic a late this and will our

line have performing will overall so our is pricing impact year. is year-over-year less expectation, strategy last the far a this than targeted negative increase it And in but as with

Kyle Evans

it. Got

there to X I’ve are and we you goal. that progress cannibalization million best While it is your incremental you, goal and much that of like then should sounds making guys digital-only a subs of longer-term how kind that much is In how circle? of your got is good estimation,

Maribel Perez Wadsworth

our It's in a no circulation a There's mix there's good question. question digital-only volume.

revenue to that our the so our growth are that some grow net But up Especially on nearly it's previous ability more increase rate pleased in to retention through is very the we are full percentage hand, access to of are a side very you growth, adopting on XX% we the that base. quarter. rate very and are revenue are higher digital-only. side improvement folks who XX% side. overall strong and the aggressively digital subscriber year-over-year folks other the pleased one see year-over-year stepping -- in from continue in pleased with the volumes. growing strong, We on there That’s new hand on the There

that’s very So important. been

are We aggressive. we are -- more Bob speak much this, you heard both being and Ali to

markets. are up a of across We variety tightening our meters

that We for we have work dynamic to his to stronger that help personalized drive our users messaging in us Kris team believe allow Barton to conversions. and more product, meters implement

development that we that's and portfolio diversify number So, also on to have. focused And of certainly product important. are new we offerings expand the hopefully

April launched matter of as fact a in we application. puzzle the TODAY Just USA crossword

a the are that will gate strong be out recognized definitely new of that’s to focus Apple's the very which very really drive be application and that helped we closely, they one are downloads. very games We us. key will conversion for of Obviously, loved, but paid watching those we for and with downloads as happy

Kyle Evans

goal? digital-only? X five outlook year a mean long-term million I there is three And on what’s to the that

Ali Engel

in X.X million of We’ve stated a and materials about we’ve out -- but to million recently, growing it's put plus. lot X.X

Kyle Evans

down dive … we ReachLocal down on Can the Okay.

Bob Dickey

five on the by end take years, won't million X.X that Kyle, of shorter Hey the … way,

Kyle Evans

not other get Thanks. are I that get five? to to figured going three -- Yes, to In not you're going out. words, you

Bob Dickey

No.

Kyle Evans

kind in of a sequentially your have you like you about we should now that for should two how year? got fair. you've think sounds across that dig it place? Just idea first into and some the quarters given maybe we then That’s little Can were to how margins the the invested churn? under sales client the in people alluded as You back And churn. we think down larger down driving any about what's X% ReachLocal Okay. Do same-store? margins

Bob Dickey

because They’ve March year plans. Yes, a is of late and seen to great this see as fine that growth the been they last expected we you've team industry. have take year, and slower some to going the to expect and start the sort I think job be advantage put in an April. acquisition with Kevin of year, In margin the to early started the across doing

us, we and how team -- For certainly was are quickly very to also able off. improvement the they’re acquisitions effort excited start We’ve pay seen some energize sales to those the will in churn.

So, build we then revenues the margin the and keep of as a at in business always It's large not will -- out can speak. lost end will We January margin couple clients. to starts lower of too. well. year uncommon that. continue grow of course will It that as the benefit the it the Kevin in the and we during

those As made couple many them that had of in a bring direction. to attempt they get that larger, past of we and reference it go the in-house, I’ve to

a appeal saved we to go WordStream to want to WordStream, yourself want which we other approach. able sell part those a Kevin, add. to be a to now couple any the also color was you to We was who of of service with it do said have

Kevin Gentzel

that good is for all acquisitions very to in reiterate looking April said, to well. as us March strong just new a was Yes, client month and

lead in help gen trends improved the half growth which as QX expecting should been of QX, investments are we in So second also half the in and year. second well. the more robust making in We've in

Kyle Evans

you. Thank Great.

Bob Dickey

it. Thanks, Kyle. Appreciate

Operator

comes next from Capital Kupinski And you. Michael question with our Markets. Thank Noble

Your line is open.

Michael Kupinski

Bob, offer I congratulations. And want been I over appreciate you working nice Thank my you. It's years, it. the to with

Bob Dickey

I always enjoyed Michael. rest those breaks,

Michael Kupinski

A couple of quick questions here.

and flow nicely will came my some The for quarter. cash believe cost Company against lower and did cycling cost consolidation you those the had that those When than start in in facilities last expected -- You you reductions? year. obviously the beat estimate I kick when

Bob Dickey

let there. that responsible I since is she great for on will touch performance Ali that

Ali Engel

don't the I exact we have more. the last year, Michael, dates did four just of Yes. did we but ones all

that through rationalizing that just everything are within on continuing work So is we to organization. going

through continue very built the XXXX So cost organization to GPS we that. significant have and savings work for into

So, year it's happening -- well. year the and the year, happening last throughout year they are are they as throughout this

… So

Bob Dickey

us timing [multiple the for … Michael, speakers] Usually,

Ali Engel

as … well, yes.

Bob Dickey

Usually three start from just the to just or timing in it year the the four execute out more the we the us cycle and takes of Ali usually consolidations on. in as we are way these plan pointed process, for before, bringing like

cover against tend we those to comps. terms roll in of fairly we nicely that So, once year-over-year

Michael Kupinski

you. Got

Okay. now And -- The I'm were focused pressing revenue. that accounts then to you and correct I'm if I just In back at -- going higher did like my -- was strategy ReachLocal. but to wrong, concentrate the account margin seems ReachLocal the point on me one of and on get are just margins accelerator it you the on or -- the curious? wrong because and

Bob Dickey

holding but because products upgrade lift sales And think now X.X going and as at over staff we two. thousand about a back when acquiring pretty -- average because wanted but that, per dollars that $X,XXX we’ve these steady to are that a I products outside X.X not selling to upgrade, ReachLocal, what couple acquired it train the the were now the we we per we emulate we to -- of So few in client, client our years starting ReachLocal, -- now, saw they selling client. are are fact also are of proud as in right that was the over able we been the -- to Mike, local revenue we that. a new more first diversify you are got of which markets, it very we clients were We the in products is right as in and well

a end of not a of because split spend. bunch bringing sudden are we lower we ARPUs clients the of all at the who are are in So seeing our

knowledge XX% that ReachLocal in annual really who local we’ve client hired. already team And to go are we margin the plan add we the help specialist then feel because bring to so off Kevin's them. resources. in supported range local sales for that and that somebody double once to of that reference to market with achieve to right and now, That’s in speak really we XX% paying and made that the needs we the that can able relationship and clients I additional

As you clients know, local don't they the of have and vendors. time. calls more businesses just and or multiple very different are different going even through sales with complicated It's exchanges

of coming minute to and Z handle helping let of to businesses how them. those A Product really speak So kind side that’s LOCALiQ that the we by local are just for being Kevin's suite. things and can to a they’re product full are Kevin are very we Barton, team doing well markets seminars show resonating. or products starting of kind also to our on learning sell Chief the that in team this going who are of is to these suite his two received full I'm a Kris? take some doing Officer, Kris and

Kris Barton

we are be and so selling large on Yes, that recommendations Gannett to to themselves with we on our focused as prescriptive really [indiscernible] datasets we on the have the couple clients. leverage to our how combined that a of continuing we get things diversified portfolio, are products should more

it and to to to that them to portfolio expand sort in give that’s offerings we is client, of simplify to then sort we’ve score, translates of of matter of simpler set budgets what work leveraging recommend can all can and process. -- done And a the them so again respective minutes a in make that hopefully our a a And the go-to-market. we that and really data grade entire

optimize in to leadership And focusing -- so teams. sales side on that’s are with that operational toolset of honed we getting the and the that continuing really

Bob Dickey

And just real quick. you then Kevin, if I think, could

centers these started One knew of we last was spend bring year, of we we that. would call clients. those churn There to keys inside a lower lot the experience

Now we to are starting traction. really seeing that get they're

So briefly you why just etcetera? seeing terms performance what don't in speak churn sales improvement are there, to of you

Kevin Gentzel

category a lower digital Yes. a them move there business. it actually the clients fully and the clients to have types and the could for it's call local and segment form practices, and we've we’ve as regions QX who quarter able the dramatic to this treated certainly call seen as into been gone of expectations by out was a grow to they completely in start into our for The get ultimately standing to has go-to-market be geographic a of improvement future first centers print bespoke in sales in build vision three half. QX help continued our significant transition, these are and so breadth number we spending clients behind to that ready able manner And of improvement us heavy been we of located that and was centers as best the to inside propel second we through so of

Bob Dickey

is the Michael, are higher helping Howard manage margin thing that is I say with then, with business. And very work we operation and Barton WordStream. managing, a is Kris last happy would that to

all of that, the maintaining combination line margin. the So top on and confident we we the the keep very can are growing pressure

Michael Kupinski

with in can idea to expect give maybe that expecting? growth a the second revenues? about; growth of of the Lot WordStream an on would mid growth thanks given the expect you kind show rate that terms picture, us just frame you kind maybe segment And better terms in thoughts the give you of single-digits, of us type double-digits? what type WordStream, of we expected is of mean the can reference ReachLocal added of single-digits, especially of we you your overall what I of for are to then in of And are high what color. frame if half, talking subsequent in quarters

Stacy Cunningham

Yes. this is Stacy. Mike,

a cycling we double-digit I think our not That’s at same-store that basis, strong expect and business that on still numbers in we I this is to on growing bit forma point. But say that I'd continue. a pro think just are WordStream, in.

roll will we go numbers our of second that the year. will So at into obviously into second the half same-store help half as rates those growth which ReachLocal,

half see more So, into growth I think second robust we the we head as should of the year.

Michael Kupinski

the in Got have final know buy stock authorization? remind you I question. but you me left quarter, you. can And the one that share repurchase on didn't what you just

Bob Dickey

million. $XXX It's like north of

Michael Kupinski

Okay. All right.

Ali Engel

Mike. Thanks,

Michael Kupinski

Okay it. you Appreciate Thank that’s much. so -- all right.

Bob Dickey

Thank you.

Operator

our Thank with question you. JPMorgan. from next And comes Quadrani Alexia

line open. Your is

Anna Lizzul

question. is on you for Quadrani. Alexia Thank for This Lizzul Hi. Anna the

wondering the the were continuing see in the earlier I cost call, operating XX% on for if expenses reduction in but at touched think year. year-over-year. could QX, decreased you talk We remainder looking sales of about how of cost about you this the you more

Ali Engel

Yes, sure. Great.

we that think new some large expect, if, last second do as first the in year the the the see our think as will quarter. in in of don't also first we we things hiring cost be as of will We quarter look, So, April are quarter cycling CEO. in started we quarter so the declines second we

a other CEO of the quarter through. come expect hit we transition costs with And higher our couple some project. and technology the So outsourcing will in associated issues timing second cost

we the digit quarter, in cost the costs see saw first down. quarter. single more opposed expect to what But as in the mid in be always we expenses So do we to second to same-store being down expect as

to continue We we are the -- cognizant and to different are and have very at focused are as to of manage cost that on always conscious very be can ways looking you appreciate. need see very our and expenses

Anna Lizzul

much. how ask Great. print decline advertising follow-up to … I the Thanks attribute If of the in question, you so the much do could

Bob Dickey

Hello. Lost you.

Ali Engel

lost we we Do to attribute sorry you. …? I'm

Anna Lizzul

benefit later How the in to you attribute with much also the this of Easter decline in QX? advertising the print Easter print for the a you and do how much are later year expecting of advertising

Bob Dickey

sort is it's wash, … of not Easter Anymore a

Ali Engel

yes. It's not much, too

Bob Dickey

to see. not we used it's like a big … lift

Ali Engel

bit little of a nothing It's material. It's impact. an

Anna Lizzul

of All so Thank much you, and best you right. luck to Great. Rob.

Bob Dickey

very much. Thank you

Ali Engel

you. Thank

Operator

have. today’s we This program. conference. you and participating gentlemen, today's questions the concludes in all Ladies That’s for thank

day. great disconnect. all Everyone, have may You a

Stacy Cunningham

Thank operator. you,

Gannett (GCI) 1 May 192019 Q1 Earnings call transcript