TGNA - Earnings call transcript Q4 2020

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Operator

Good day, and welcome to the TEGNA Fourth Quarter 2020 Earnings Call. This call is being recorded.

Our speakers for today will be Dave Lougee, President and Chief Executive Officer; and Victoria Harker, Chief Financial Officer. At this time, I would like to turn the conference over to Doug Kuckelman, Head of Investor Relations. Please go ahead, sir.

Doug Kuckelman

morning, XXXX to earnings good and fourth and year full call you, and our welcome quarter Thank and webcast. and review and President Victoria our CEO, and Lougee; Today, our Harker, will TEGNA's results. performance financial Dave CFO, After for open that, up we'll call questions. the opportunity the this review had morning's you've release. to Hopefully, press

the you If of not at available seen yet it's have tegna.com. copy a release,

cause and includes Before them This Factors and webcast call that this we conference differ. outlined are get started, differ financial presentation may forward-looking to I'd our statements, in like that filings. results to may certain remind you SEC measures. actual include our non-GAAP also

to a We press provided directly With comparable measures measures reconciliation have over to release. the turn most Dave. of those me that, the in let GAAP call the

Dave Lougee

and Doug, you, everyone. morning, good Thank

of a reflect obvious of XXXX, to the challenges Despite over discussing first Victoria quarter first saw which full today's year. the before I call face you and on lighthouse in want noted, and the fourth serve. this Throughout morning. financials, year financial our each be to misinformation we sea TEGNA we provide quarter communities our disinformation. included this also local But turn achievements on will I expectations results steadfast to the our were XXXX last trusted our a our moment Doug of for take and in and in on earnings full release remains newsrooms our colleagues and and team XXXX, we supporting significant incredible As year other a year, the we'll information

our and has to that and and purpose beyond. good substantive serving our brought the more needed our deliver audiences. Our stations clarity, amidst content news across before and found the relevant innovative core been greater markets of Never to pandemic hope context ways

fiction racism racial winter of in of stepped injustice. unprecedented inequality their developments highlighted the stations, reporting others, And to pandemic awareness up production states. And when leading incredibly from greater following our implemented combat programs midyear related stations themselves disinformation educate platforms, two our cities officials ago, reporting special saving of power that last to Texas text team systemic federal on our important Texas, fraud. other And killing voters very platform year's weeks of through systemic and voter to at digital programs safety crews and in directly creative access in help through and while answering Our ensure holding injustice, TEGNA and comprehensive stations create content the huddled failure of the to for racial up fact multiple journalists in to viewers accountable from the and helped via for and George questions social utilized providing Floyd approaches daily delivered just UGC messages and all acts Uri and elections, sift grid. an storm their and folks through state staring our smartphones information, the cold, and life

who colleagues through cannot made our the heat, Texas same thank team of power, All all challenges the of for no perseverance innovative water and nearly going enough. and were was of possible spirit X,XXX We families. themselves through their this the no

and this performance turn recent to Now the to for most our quarter past year.

to evolving expanding portfolio of five executing resiliency the focus of business strategically which strategy, a saw performance challenges. our and we record affiliate results our a model you its macroeconomic direct today, This year and of our posted increase stations. located big As the our the unprecedented in January in is despite prerelease commentary result in pillar of years against four breaking had we included

continued evolve, our digital unduplicated average million visitors monthly with have platforms now properties. grow and XX digital Our to to nearly

increasingly will of ahead step our work of viewers recent examples sports. A Locked local expect. On, We have one that leading our stayed for the also content podcast few the acquisition include services and

reach distribution network and local Tubi station's announcement for of multicast about for this our successful when Amazon covering the women a XX% agreement Twist existing later with just that TV networks. build infrastructure of new True and OTT multicast And will products, last of upcoming the agreements spring. building DMAs Our week growth, Fire. launch and our debuts it our household with US entertainment will on Twist, highly Crime of on Roku previous Quest

subscribers our going will initiative we Another VERIFY, the the building VERIFY stop continue we in is more VERIFY is XXXX. VERIFY year non-TEGNA we at and And have the into media disinformation in high year-over-year. that on expanding a growing checking reporting our demand and to alone national its misinformation country products announced XXX% play to spread launch other sites on social continued owned are we'll through and unique us area like in last of do million helping digital local reporting X.X launched already forward and XXX,XXX focus critical the franchise January, we our digital stand addition stations, than fact brand. for expand through role of In locally viewers. Snapchat, where already dedicated nearly in we to operated platforms,

advertising as more despite in revenues than a XX% market, more $XXX fast finishing know. growth, of top had advertising our to year overall growing than we over an Turning dollar up all Premion million, record to down business space. the of relative the with Premion, the XXXX

XX% of And announced and TV partnership now households, across can local markets the force, sales advertisers reaching by our US direct TEGNA with our forces sales we year, With can directly the Premion Gray covering distinct in we serve entire combined national viewers local OTT reach advantage. and of Gray last serve country. a advertisers XX%

our did serving momentum continue even expect in year, and drivers for similar advertisers, of underlying to publishers performance the subscription adoption key to continuing and the for value it and our local proposition an business revenue TEGNA, We business. growth a our strong of of last the broadcasters the Premion grow pace one alike. XXXX and durability as as model stronger at is Overall of

to exceeding guidance by XXXX. multiyear we our in the rate the provided top agreements was step subscription in contractual increases driven up growth the year along On prior the This retrans line, renewal with ups. revenues pandemic XX%, early strong finished

XXXX approximately availability with year, to reminder, XX% our subscribers paid this last for a we year. come. subscription provide agreements, reprice clear multiyear into the As growth of repriced of end combined affiliation years toward and XX% These will agreements, net in and approximately our

of on markets now for NBC, end our TEGNA including covering beyond. XX of XXXX have XX% affiliation which side agreements For top NBC. revenue agreement business, expense in with the of our our markets the subscription network affiliation XX instance, Four subscribers We through January, covers the US, the and XX renewed of we Big in place across

the the profits on our line in to expect to increase XXs we year. net we to So percent as said retrans, earlier bottom today, this subscription reaffirming high year this we're mid and

but stations they As $XXX our spending are level of were advertising not the we for election and record trend capitalize well. presidency, strategically of year continues the as year Four call, as able Big on political a with portfolio year to discussed during our we third an races numerous to higher states, spending Senate Governor's in constructed through battleground million of just unprecedented quarter We cycle. four had each

XXXX the political As in that double that XXXX XXXX, times presidential X of and election of were almost prior year. almost revenues reported, our

We extraordinary expect cycle off for XXXX robust to be TEGNA. cycle another

Our XX have US and will XX races portfolio Senate races. gubernatorial

Arizona; Pennsylvania; races by again; of in yes, where are markets, Ohio; we Senate competitive neighboring races XXX% covered of Wisconsin, As TEGNA specifically, and today, the again; Georgia, get classified Georgia, Carolina, in the Minneapolis. North spending Carolina, very as yes, North

and subscription being remain to continue revenues efforts have brought political we well terms as a going to with to competitive percentage Florida, Arizona, year our revenues of higher than our XXXX Georgia, result had again, and of forward. We In Wisconsin. and promised prior capture of our political comprise we last greater expected these Combined, revenues positioned two year. XX% a gubernatorial total as surpassed are in-house have even margins sales Michigan, Maryland, to we races, Pennsylvania, high-margin

to our nonpolitical advertising now revenues. Turning

As we and pandemic. were our revenues by marketing most the advertising have services impacted previously shared, the

of However, positive are year-over-year political outlook. AMS I'm full provide pleased the marketing to growth, more finish despite first and with finishing combined This on services the to to are the key X%. we drivers just improvement first advertising say revenue will that in pandemic, down year have year-over-year sequential peak full the growth, year color expected the continued down X% shortly. see XXXX AMS Victoria significant trends only revenue subscription since quarter. and quarter and displacement quarter of quarterly the our our

Now turning to capital allocation.

how of in diligent containment year, thoughtful continued cost we review capital. we the have be Over efforts the manage past both and our our to

already we strategically discussed implement reductions, we the place of to identify the As on pandemic. at and onset quarter, COVID-XX, efficiencies prior quickly in and to last expense acted building

result, a $XX of have prudent Victoria her management same more these strength will generate we year. XXXX. accelerated our on and initiatives billion annualized provide revenue led cuts drive and of executed on in in combination will exceed continue EBITDA efficiency $X in of and adjusted The base out at XXXX, million and cost to savings an to expense initiatives pace within As recurring cost expense the to savings expense us remarks. our for detail initiatives these

with lowered we outstanding overall our rate refinancings of no until extended senior XXXX Additionally, maturities, maturities XXXX. the two interest completed notes our in and

our which strong cash finish our prior as leverage of full of Xs. pandemic. a guidance a by two On shareholders. to this XXXX, quarterly XXXX X had also continue Our while to COVID flows paying mid year still debt, to exceeded in we full revenue pay free expecting our the times resulting down in place as less a you the leverage saw year today, percentage as our pre us net in goal cash promised guidance, to year dividend than with have to we in net and basis, end a was allowed the accomplished And we're regular flow

returned at our to generation, this flow that long active to are has in Board always, expectation capital and all Further, continued or and support shareholders. we light weighing recent our the number near through our most the position for performance tools In organic, carefully of program, our faster action growth evaluate those any of buyback of our lens our the a conditions. shares, three continue with expected toolkit, most current the options repurchasing either through inorganic strength year balance million for us sense debt January, our increased announcement and amount with the create our to The and is end, over disposal increase presented the again, us, return to believe of cash of allocation well deleveraging. of business, drive value and All, continued of that repurchase than value sheet, in we of term. we're To share on shareholders coupled as both. what of will paydown, of our through ongoing the our reinitiation to capital our In the both the continue to to what value our beneficial our to always following to both have factors, renewal lens will addition an December dialog continuing return most for expanded increasing shareholders financial we makes strong to light shareholders. and in market now light $XXX dividend the of opportunities

highlight over to here facing one of to call Victoria, social I continued the pass of responsibility, enhancements to including our TEGNA, areas focus disclosures. long want investor our I at standing Before

We our diversity is XXXX TEGNA there including a Over for of Grady and group. the our highlights published workforce. Trip, the additional our as of continued the improvement. we diversity, social Officer strengthen through and equity know well responsibility and our over focus oversight the have includes identification of for last inclusion to and our DE&I of related to working our just DE&I diversity We areas report, specific launch appointment inclusion which Diversity oversight Chief disclosure TEGNA, of Board throughout at leadership room of as employee year, the

the leadership we ourselves goals The and established and also hold people the of accountable, near preview have responsibility site. also across We to be morning's convenience year found our disclosure this term. to representation would increase roles news color encourage a We detailed can SaaS in a management linked forward reporting, through Web to you cover our environmental is report, investor impact on report company. take with ESG look black, that, So for social turn for in areas And to important look the teams, to our adoption industry in call to indigenous five ahead. reflects our and standards which our release share this of and to the progress tracking our your quarters detail. highlights these enhanced including our more continuing I'll years financials more Victoria the in of B of over also content in and in

Victoria Harker

and Thanks, everyone, Dave. morning, us. thank joining you Good for

discussed, company. Dave the the record a of decisions since had in year recent strategic just and quarter strength we've becoming As we due model fourth pure a business to breaking really made, challenging months but and play broadcast ever our these most not

value our strategy a served growth. portfolio future thoughtful has throughout strengthen That same balance capitalize on strong shareholder positioning to of also to M&A resulted while us in disciplined well allocation Our history. has our capital growing approach sheet stations, to

focused non-GAAP our into financial on are to drivers well as performance trends you business provide on results. a primarily TEGNA's operational basis with my As visibility comments consolidated as our of reminder, a today the

and all our release. our reported You'll period find press of in data comparatives prior

in As provided morning's saw metrics the for you of this XXXX well. first as release, key quarter guidance we

seen release X the I'll be outlook. We've provided expect of press a we remains you've detail in the our January for in my drivers on added more our year balance our in remarks. what this our year. CapEx as our All later the addition of pre-release, also strong to XXXX touch of very outlook projections our on detail, more full nonrecurring morning, of with guidance we as in

onset lower company marketing XX% year-over-year quarter services, fourth to continues was up This driven revenue of the by up total COVID. each revenue in was offset advertising subscription revenue, which, record and For by XXXX. quarter, Dave the political as advertising compared to strength accelerate the XX% fourth continued quarter since and pointed and partially of out,

details. this growth, Subscription revenue X% of increased are terms revenue stream additional here In some quarter. year-over-year

but As with approximately service XXXX. temporary a of in the have ups it of fourth December. reminder, for of would repriced a quarter growth reflects fully rates DIRECTV in The been XX% AT&T step of retransmission suspension up impact with XX% the in subscribers

high earnings and trend reflected our us on reporting margin of with from than net continue positive lapped counts production. XXXX recent growth subscription was start free fourth through our This profit in expansive in said counts flow XXXX. we prior our our quarter. well. by strong to growth and quarters, We stable our Subscriber growth provides most footprint, mid revenue as XXs expected, our continued after call, lower net the November that As last with acquisitions annuity like subscriber forecast in with EBITDA combined having high subscription XXXX growth political subscription the to cash the revenues, as

execution than in you a of year, As has plan. this saw resulted portfolio indicative evidence resilient ongoing more ever the successful this our before, strategic of

guidance. the AMS driver second also serves marketing and in support pandemic a height the growth to the and services year. improvement of to related revenues, AMS first X% the $XXX quarter quarter primarily compared key our This advertising turning as our political shown last have Now down fourth record fourth since advertising quarterly of XXXX sequential year quarter to million which quarter. XXXX. finished of due to revenue full displacement was in core to

television traditional provide on and on the color in in nonpolitical We category see recovery advertising advertising in audience some further and both fourth categories metrics strong with you quarter. To platforms. trends continue many to digital specific

positive, this to single entertainment, Automotive and significantly, political when December. home to and only and the services, November That restaurants, year-over-year impacts mid As single noise are trends, said, is struggle, improved year, And many ongoing continue digits notably, which Not November pacing packaged categories banking among you'd goods. last looking automotive low up over in at categories, was expect, and categories, down financing, specifically relative and and improvement, displacement insurance digits there quarter. including pandemic. given from the tourism, up surprisingly, travel of retail, December or October.

also the to advertising expected as and to positive trends, it's pace of well, positive year. last above continuing these year finish to pacing AMS last over see Beyond this with quarter first improvements quarter reaffirming

touched quarter. year efficiencies cost drive fees, investments were costs, and driven Without on the by to to by bit Premion X%, more the Premion. operating permanent just expenses color revenues. as other impacts X% Now programming, Non-GAAP the we expenses increased higher programming all year year-over-year, specific the of fourth quarter To million, to in last fourth operating including growth turning subscription for continued up management Dave the that $XXX just programming provide the compensation reverse operating down across on expenses driven company. initiatives continue expenses were with initiatives as such for compared X% earlier. a Without

discretionary Our expense expenditures term of to pandemic reducing our savings included during the costs health of in and peak long order the course, all nonessential XXXX, of capital business. the in protect

important were reduction company business it's highlight to efforts. our processes in of ongoing these streamlining cost However, addition to wide and the measures

in As Premion. which been and from known we've also culture TEGNA prior of decision time centralized as in structural streaming including control; to national center, cost the management instead further away improvements on some our a as across our successful upgrades growth to digital products discussed focus through organization, integration our have of include master efforts to brought sales like commoditized effort thoughtful the of our products video strategic sales those reallocate paid in house; of investment media part portfolio, for these calls, Team leverage. One operational underway Example

full the for cost result gained, a our cost we $XX savings disclosed a realizing and takeout we previously earlier than of had annual end these planned. of are targeted we've year efficiencies As XXXX, initially million

produced conversion flow growth cash EBITDA the margins into permanent reported these future. morning, coupled free very well seen reductions, As last with strong expense and this year investments, and you've revenue

XXXX. million, growth As now Adjusted XX% all sheet cost savings, political the up we was a as contributed quarter in quarter EBITDA balance ongoing quarter. high of result revenue, advertising a fourth XX% results. these margin touch of and of liquidity. for adjusted activities on year-over-year these $XXX subscription EBITDA margin like well to XX% the record briefly for and drivers, as achieved compared producing The strong to to I'd up

our a further previously balance we've series past year steps in taken mentioned, we strengthen sheet. of As the proactive to

excludes this hand financial completion the we stations political at stock based targeted in of $XX our quarter, of covenant, XXXX, items our performance BB September of of the revenue. leverage XXth, acquisitions. times refinancing share of also the carefully we caps by fourth well as recall, the on you total compensation. in leaving entire of and program our covenant the S&P of continued callable historically used as had defined calculation. $XXX record repay flow, rating, XXXX. we testament in which leveraging accelerated positive. our our as producing free of XXXX million interest March had affirmed $XXX December to proceeds ability on as portfolio leaves headroom only us our $XXX times to schedule, As of including successfully million of due first our level our debt stronger In capital by at $X.XX ahead model This full very And flow, December. were upon well Having notes balance end $XXX of XXXX, environment. to our revolver below eight X.X few The opportunistically the XXXX, related milestone $X.X trailing leverage, a recently borrowing allocation times quarter, debt of low sheet. capacity as during senior minus high before revolver $XXX margin outlook. may notes financial on we this billion with million million reduction thoughts for strong billion balance XXXX credit based repurchase cash certain cycle strong XXXX political the completed the ample cash revolver, the manage turn EBITDA important X.XX in X.XX rate We've remaining The million. Obviously, due To at fully reinstated delivered million revenue, cash of provide such XXXX unused to as on we revising $XXX a quarter, strong leverage outlook stood a X.X financial results Reflecting and supported our left reducing XXst. under of now their a The resulted I or quarter notes, reduced our on a free only which generate under our to quarter leverage generated to XX% year million total driven to net times

and and this to history, volatility. our disciplined As delivering has our and remained to shareholders. period uncertainty pay We've during our quarterly managing in critical liquidity, dividend been true continue throughout of prioritized has TEGNA investments recent particularly prudent spending market while regular and debt down

over we authorization As program, share $XXX also of years. next the includes renewed I which million mentioned, recently our repurchase three an

As we XX, program upon buyback our of divestiture our of XXXX, a the acquisition had suspended Nexstar-Tribune the March stations. announcement on reminder,

debt was to those including paydown we We position, an significant with then our value our acquisitions, ahead that strong our shareholders. associated were debt did have Thanks as reintroduce additional to buybacks schedule, able paying tool of opportunistic that. just we stated and down return financial to priority to

capital As shareholders capital any are additional funding debt while or analyzing flow we disciplined Dave for including significant and that carefully given framework. mentioned, to investment pay opportunities fit deployment, also cash inorganic to still returning our generation, our additional our continuing options organic down

also despite network networks, a our not XXXX. This well accretive stations opportunities for On only complement that true pandemic. of impact true front, TEGNA's we ability our testament cash integrate in or each is to execute XXXX our on have than and acquisitions. and corporate, the operational in spending, evaluate scaling The achieved into to efficiency less which successfully longer by is True Quest in and the continuing to are of and and accretive, those while the Across integrated areas Crime but a EPS synergies on free back fully the identify stations for delayed same are year moved early we many acquired flow acquired capital of all our expenditures portfolio our to efforts. to multicast term benefits that portfolio also quickly we accelerate and the immediately in for of the now reduced M&A our XXXX to performing been

of actions our are proving to important an of strategy. be increasingly ongoing these now aspect All taken together

Now turning to first results, quarter ahead quarter key and full year forecast XXXX guidance guidance. In provide near our several financial an now metrics. effort to term help I'll

first quarter, For first expect up total mid revenue single company the quarter we to be digits.

see partially single first in both in by digit the driven services, advertising by to in subscription advertising political We mid last expenses. expect operating well quarter revenue as We programming expense year-over-year year. percent marketing record as increase to forecast revenue offset the growth,

driven Excluding by to majority programming low which costs, we the be digit project is the Premion. of range, expenses single in up

of with to naturally, to which ability both driven drive well collaboratively MVPD This MVPD revenue XXXX, up year XXXX subscription to work is well completed we cash flow, end stable as at by mid successful now expect and trends. of percent, subscriber into high free be proof strong complete the full future. renewals For to positive partners agreements, revenue our teens and as the our

of the affiliation XX% the into place fully NBC in our Big Dave after As XXXX covering with of clear at agreement network visibility relationships, strength our agreements Four Big the of entered this beginning of renewing year, XXXX. end mentioned, affiliate Four through subscribers with we our

reminder, in of our months. which elements. overview initiatives full been We underway EBITDA expect key XXXX also updated continue will significant a XXXX and past that And have guidance to for free cost the cash flow, benefit an growth XX year year as here's full from

in million. to For million projected in $XX the projected expense range the to year, be to be in we is our $XX be $XX $XX $XX million. be is of expect the $XXX $XXX million. through of of refinancings to Amortization is Depreciation to corporate benefit of of to the million million. the $XX expected expense to range reduced the million million range in range Interest to

to nonrecurring is as range range as UHF capital VHF facility. streaming to to approximately the million, $XX XX%. The to of capital includes the expected expenditures effective tax of expenditures well expect million We $XX of comprised to of of million, continuation in the be which rate be transitions XX% $XX $XX our mostly in centralized million

XXXX other end with uses to capital mid any beyond of X net deleveraging. absent leverage expect We times, of

Finally, and to we context expect of for be your to And XXXX of free XXXX and greater turn to color XX.X% to now all that, cash revenue in percentage take flow that range Q&A provide questions. will Hopefully, as of additional XX.X%. for for a modeling. the with we'll you your

Operator

phone, move I comes our the Instructions] first [Operator will Kurnos from Benchmark over question to now which Dan from The Company.

Dan Kurnos

peer material. in called group your of bunch see back Certainly, you other it's about out a to doing a the Just becoming of I nice in guys is lot maybe on auto gambling terms been just on Also sports, well. sports by category. green. talked maybe categories the know the

putting the funny amazing it's it's be you're then a and dirty tech because where know think all and to now you what used on that, color ad separately, is? seeing some we maybe there, Premion. what opportunity And word, Just you're

You guys are obviously crushing it.

Dave, I So I'm appreciate thoughts just curious, maybe allocation. on incremental really the capital

or nice meaningful you spending of of to tuck-ins size? expanding that's of grow Premion would make continue VERIFY. kind aspect? some CTV there can accelerate the any for of nice I within here kind other to services, Is adding even be hear. of you've kind that Are those any incremental more to the Premion things at things shareholders to to way bucket think sort and But there the done, going be

Dave Lougee

accelerating on We're behind. not got We're a has going mover left focused moving It's terrific in We front. a The to job done absolutely to fast are going first a get in executing. were We've the Premion. space. fantastic We stay brand. space. of team a

So a acquisitions, that well. absolutely could include tuck-in organic as initiatives number of

than able to opportunity OTT Because, on do So need to it's what focused in again, the local. we're long to that And viewers really not space and going do absolutely local we're term. we're but growing that that long this we apart We're really And doing suggesting focused here we're yes, more advantage a national, business. on that but important we have advertisers services connect to to whatever space anything for what's us take over to tail on of is laser competitive national. that business. anything, with be today messaging of is sets reach grow us to that well

early the of in for we're have the includes innings, also Maryland, Virginia in market, I done coming, very memory mobile correct. Washington, and DC gambling pun DC. believe, and state we're my betting, Maryland seeing, sports I for As if recently. is just no has instance, DC it which yes, And legalized both But the intended.

for one market, already, you seeing event William in WSA the Fanduel. advertising sports can't from Hill, DraftKings a it's So or without books, of on watch instance, DC the whether

see pandemic of tax we states But be So the you're in moving area important loss the seeing on that do had, local revenues given increased it time. and a had it. over of as an the before we always local pandemic states said it -- would growing number have

coming also Kentucky, We Ohio. for Iowa, legalization Indiana, to Carolina be Maryland, us, Colorado, there's and Tennessee Georgia, want And in which got big and now New North York, So pending potentially, we've efforts is a DC. Louisiana, Oregon, already Pennsylvania, others. Michigan, we Arkansas, one Connecticut, active Missouri, have

this did our at but stations nothing to ad to as well. be really it just be continue we advantage if also looking good services, yes, take digital our category. we're But So and ways -- benefiting from other would on produce content it's we of to going

Operator

Wells next Cahall now phone, which the to We'll Steven from Fargo. from our comes move over question

Steven Cahall

with renewal of high of So like you've retrans high mid retrans the to gross your slower but mid up that I'm digits single reverse net growing mathematician, than XXs up retrans and to your revenue is in kind it NBC, expense growth. no implied comp seems

then of case, FCC, at Court kind as means what's the are And what Big of of flat really if that anything you year it for could the on escalators, giving think be company the each they range. a do you non idea And us some So expense end programming? look attractive maybe favor some have JSAs, EBITDA? accretion in there deals Are total of the XX% modest to some you to Could said that you've Fours? to the are you happen relates an that's rule Big markets to profile you that in latter of in else there I or just Supreme of at more XX% this and the going the is of networks which on terms then Fours growth swaps some us give there. on help with

Dave Lougee

up. than stations as complete anything sync together, we're programming, programming splitting your right are investments their and bottom your in On then there's between especially together, are are else our like that networks. have few flat by when and investments more between of pie. reverse retrans, line, the look, the the getting our network highest on that we wouldn't subs a our together, word stronger we're wholesale the when But percentage we're and to Obviously, of more ecosystem, never and in total appropriately compensation. And programming numbers subs for channels, use up we're far I paying

that, discussions. our assets. for percentage, line. a strong at fundamentally, we partnership But we bottom than MVPD are us little growing bit better, think discussions, is we top the it's net with negotiating I'll the With the them, So top the But of expenses. or by those seeing and what line at have are yes, than a a leverage of least both And growing retrans line call lot more a retrans, I our the set scale also leverage networks. we on you're have negotiation the quality, very obviously, and have

Now screen core. the

see, need A, then look, So is to we to going gets how it then to interpret it. the the and Steven going to what wait FCC out ruling how is and leveled be,

that's two there it certainly stations it all it's to giving of there's been us the be not will I'm on have. kind So it, worth. what could of DOJ antitrust because sort division change unclear be so at time available rid to the be it can we will it over prudent getting more whether execute be in of of and qualifier share of or of markets whether kind combined we're optimistic will anachronistic, of in market a able and administration specifically. that and very obviously of on EBITDA until DOJ. But to the be what suggestions have company very any But us total just accretive clarity attractive if any when,

Operator

our Morgan. comes to Alexia from JP the over from move phone, now We'll which next Quadrani question

Alexia Quadrani

couple things. of Just a

question on how what just an the your in of a in but restaurants kind than like on that where at real it categories pretty games? stronger. of advertising invest and of reported exposed a you I could lagging larger following on later step to recovery press roughly you. will I the color you year. second revenues does to to in First, sense your terms have bowl, Great see know tenor reverse gave bit comp inclusion expected then some ballpark have a trends. maybe your yet, in it's more in little this games super And you be impact seems where on those auto outlook my promoting different think Does up big see the terms to reports you of have ABC just But to Thank And but this people still terms obvious be? point, consistent. impact just having is of up on you improvement the we NFL. could are

Dave Lougee

AMS about talk me let first. So

sort retail COVID to like seen question, weaker So we've try looking and the the understand categories restaurants… on of of you're to if I some kind from of understand your outlook what

Alexia Quadrani

how that forward are how will are when to that can many to trying you've in get big so for is areas Yes. of in sense what and the areas, -- momentum like I’m sort looking and a recover nice recovery they yes, still further seen kind what see And the of to be? areas trying of lagging? that I'm still so ahead opportunity recovery

Dave Lougee

up have to but nowhere go So restaurants for obvious reasons.

will Now just take is together. think, really food, consumer you when on writ large, the food the category, up, first but categories, fast the now these actually, restaurants auto, food I tell has done categories, fast retail I But in restaurants out pretty you, and quarter, Fast break restaurants dragging. are well.

had we system, last week very on their jobs, about working the you I keeping are up a lot, think in savings pent accounts. X% The The the one money population home, of the have optimistic. have of hand, expenses their lot Journal from a story in that been saving has

bodes restaurants. as the we auto likely about get of that for And well retail checks. big think then very as another I $X,XXX you have well population that's and think part to

can news last and come up So think the open about about based we're we very optimistic this also in improved when auto as the all has dragging categories, imagine of restaurants those recovery pretty robust down. are us a And some there has and categories. weeks, you economy, the we around do all that which money, say, definitely that improved, you like like in vaccines are few retail on but

So despite year-over-year. quarter to we're have still going up an that,

may but have numbers very year, XXXX, half we're to these given how up the relative optimistic So especially the end obviously, very second where quarter of to that about comps the we'll XXXX. was, we're false back optimistic low in on, in

to relates it we'll NFL, to out. look, come deals As how the see the wait

I NFL going to be what and as of will to issues implications years yes, we're like individual have of agnostic there? stay Again, we games through were of very up our Alexia, streaming on good -- the in devil broadcast, each to all with the ecosystem. end it a will boards, collectively, be through And a portfolio those larger NBC partners. NBC part to we'd relative I work us. although, contemplated answered are individually XX% relationships. any relative those affiliate ABC question given network want to and First our that answers your But will for I'm deals services, bit then ABC, our continued your and about, so NBC. et XX obviously, relates the there like And on size and good we on to at terms been much returning we're somewhat for sure is company, to of obviously diversified of advertising. The little ago, which that, in very the all, now not on that thing very, But very network on details we're our make comment we're them when household optimistic of the the wouldn't see cetera, if a

Alexia Quadrani

helpful. Yes, that was really

Okay. Thank you.

Operator

the Kyle phone, from from We'll now comes move to which over our Stephens. Evans next question

Kyle Evans

were your And are even that from I this political requires 'XX came follow-up. in could us, for few guessing And what in And be A quarter? that political 'XX? much understand do How the presidential? I've of part. the on then detailed you you the percentage What then got think brackets displacement better point cycle the questions. setup odds given for a than fourth

Dave Lougee

our Well, the here presidential team pulls Julie and information again.

the me you give displacement. Let

Atlanta a also science not uniqueness, and a our So amount been in have art, in quarter. first had I'd But displacement in think larger that's AMS I we had not single But in art, again, say understanding, markets to it maybe would of of to science. for had massive is of an it, one all, and a displace high November Kyle, we December. we digits and to terms relative a put to number if somewhere what an the

would But have that us an quarter. caution, put So low I again, single positive it's in digits for art. the

As was so in for of our presidential, 'XX, XX% total spend presidential.

presidential $XXX that's we company. but 'XX year million you acquisitions, not us, in we've in will did if it 'XX. pro it a in that the on your to is what but past, And million I look actually we're $XXX counting the at performing the and did not prior the 'XX for system, basis, say, even noting -- on as about bring Now that, a question some it then seen is presidential worth in does forma reported, means on dollars we

this have we cycle, way to we going there's then had is it significant every continue we terms growth the question. you Senate have -- we'll of if race. to the said, will that -- for to the displacement money your system, take an in of a the -- never answered get like I to to you'd past 'XX. look time, numbers in out higher And moment elections the governor you'd any moment, like and that have So portfolio in see be four get XX% in but even of fundraising know at in looks to this But there we've at be think I level on this, like year be year, it at Kyle, I had don't

Kyle Evans

Could sounded give gave 'XX the us that. counts. Quick if And you I I affirm question you like build to it you number, wanted count it. had just guide. sub -- XXXX missed sub into on the stable

Dave Lougee

on in we're just conservative make very we because no what But model, you're July, we're in to been improvement have in some acceleration, an with right. right, of again, our months now, and the have arrears we three year from right previous we sub starting sure strike billing every So the cycles. months, month. seen But count

So it has out. definitely flattened

moment. the and you've it digits looks about mid-single that's very where think very, are, heard we stable so I and at

throughout So I think 'XX well. stabilization as we're continued looking at

Kyle Evans

just in of is 'XX recapping? a 'XX, you So continuation single saw mid the I'm if that

Dave Lougee

That's right.

Operator

Huber which question from to Research. phone, now comes Arthur next Doug our the from over We'll move

Doug Arthur

on you're questions. could have thoughts million kind there. to moves, Yes, a via Dave, this 'XX? cost in be summer? I the And 'XX, programs what on Victoria, thoughts hearing Olympics that any the fairly mean, you then place achieved exposure Japan on of high in any early, two incremental next $XX

Dave Lougee

first the take Olympics. the one, on Doug, I'll

of seen Japan. so I of -- the But the of point in have -- BC. in for what now is we've the total Because about of north the have our company our minority we're the larger that over about say I of little incremental revenue, committee you've place summer. think don't would organizing diversified bit not think maybe a ball and being us probably But is good the as are thing part point the Olympics ahead answer about on that seen we've we crystal optimistic homes we've portfolio again, chaos there the I I a no. that the this -- Olympics any our taken gotten now that once are of just a X.X Olympics. year so

NBC homes. homes, while great it's of a NBC for negative for So it's our all non

portfolio, have what as it isn't either the a of revenue, our grown. total So our or was our now revenues total our that especially base advertising across percentage once other incremental

from know about love plan We'd for games. I the have. would But we're the of standpoint, don't to I great Frankly, It's a the vehicle a think it be not concerned. us. country. marketing business So for good terribly

Victoria Harker

be And in premature of for relative to what's identified. that qualitatively you, tell the in already million terms to of it'd cost I on initiatives, your terms finishing the them. I we've underway, swing incremental savings think question size can beyond just But $XX the

the two second is have going us implementation, our to of started we on that financial ago. we years allowing So underway phase ERP this year, which more do the transformation

sales back We function. support types automation of of certain and have order processing office

have that systems. phases The third terms second to our relative traffic some we the efforts and of some of monitoring really of in our and

going that savings So cost on beyond what worth. of to million, but still all the incremental be those $XX be it say be of would delivering will to premature sizing sort XXXX, are to

Dave Lougee

issues back end pandemic can that we'll some taught non station has estate consolidating, live real us also we And we've Doug, be used for that the some without.

Operator

We'll Vasily to move now our Research. the from phone, Cannibal over next which question Karasyov from comes

Vasily Karasyov

days sold programmatic at budgets would the budgets online, The wanted I terms Are are about question that if Premion then Thank has? have color seeing is you And winning where from I that. Premion. wondering you directly. impressive. in if TV it is appreciate from. advertising on introduce to to understanding does to with ask or the My is very the all fit And talk was you. or so so, you're you this my what point, plans correct business about growth of model of that coming

Dave Lougee

little that what kind to have there. to more then plays of there's certainly, the ever discrete what and proposition probably be of kind agencies. coming very programmatic specifically there spend. But too, platform. over delay, may other local little publishers' is not much But directly uniqueness we I can the is time, absolutely the bit in And digital digital. at the over out budgets comfortable here that's advertiser budget. more budgets, expense. Where to are that bit our they're we're our not certainly, But So some happening there's too. safe the in. and level, more absolutely necessarily the can't source Locally, of large but content much digital of but your just advertisers time, this take programmatic and budgets, we part TV TV is, at budgets coming They're and of be and out certainly a at TEGNA a speak it from coming whether some it to about a will discrete seeing -- the shifting avoided environment being of

a to but combination it's discrete from of budgets. digital with both the definitely TV So moving trend

Vasily Karasyov

of you XXXX And did you rate saw relocation just in the of see the in or that in continuation change is it what 'XX? the

Dave Lougee

think, back budgets that get And side. go lower think TV you and back this, definitely I traditional. have outperformed sense to I digital to but there digital, way fell just from than on more given double probably and check. Premion makes the it and way we'll And was

Operator

the over question next our from Craig to phone, Huber move now which We'll Research. Huber from comes

Craig Huber

that, XX% that please? was than Was The think fourth the impressive higher growth even that I plus or you in what last said guys had you quarter in Premion, year.

Dave Lougee

-- I'll sorry, answer Craig, on, I just yes, Yes, in it. I'm Hang get is the yes. that to got

Craig Huber

up better the quarter, rate materially in Is exit it let’s sort fourth the of? than XX% say,

Dave Lougee

definition we but it Well, material, definitely definitely higher. the was higher, debate can of

Craig Huber

years, think be sports betting could for do day, stations? the betting Sports your you advertising years, five three category say, in few TV top coming a

Dave Lougee

get to an all. don't by going that states but of a think that that. see acceleration and stations all hyperlocal hard -- larger our I you'll going the Yes, to to variable you're you'll stations imagine definition, time see actually But things I also yes, certainly to legalized, issue, will many pie. a advertising at I see be think share a be doing how have Again, of

Craig Huber

force. just you more on us was update sales costs? it a question, there, made about drive Can advertising changes with you little my Then the further to changes and bit help line your top also your what Dave, and last save

Dave Lougee

It's circle. a was a which virtual all approach, multipronged

did So job really act sales, our Premion also that frankly, especially sales But provide national that outside our that needed we'd take to we save for others, us. very we And and so right platform. of clients clear experience our a national knew it of with became we firm integrate political the over to a political in used time, amount that could ownership we including with advertising. to the good tremendous especially and our money, an

business. a our do we lot cetera, large agencies Atlanta, business, frankly, in that thing major a Craig, now we're the been people So really have have that, national call major it, national have lower in intentionally doing, TV which rate. on et is we we, even like expense other traditional a of Houston, on is But markets, markets, local Dallas, calling given

to business our with been team business. accounts those now totally sales focused own we've able sales very house be in arena selling on so team, to request to just the as local of new in our so nontraditional national opposed And ideative for house some our can innovative in proposal that doing assets move sales

And very very amount so team, credit we're it it's give year, difficult that, very, during of the a process but in credit been a the of the for doing effective. doing massive

Operator

Research. Jim our Barrington from We'll on now next move question to phone, Goss comes which the from

Jim Goss

bit Also thing, are if or could to for talk about there were you to the any are about, and that A you about establish on black. of about to core Premion give years CAGR By services. probably vehicle now, little could Premion. guidance the it One like streaming more trying I And looks doing enable beyond to you've process that -- talk in sort over well? because wonder more three next to you streaming wonder on growth as and the you the business. well you've as talked more if willing aspects profitability I as if some as process. five been think enough also talk time, the that discussing just you're broadcasting, whole and I

Dave Lougee

So streaming in terms multiple of there's services. services,

itself Roku top So and Disney stuff. service the the of on we're or all look Pluse’s take is of the a of and at that, distribution just in traffic on But because amount aware a the Netflix’s Roku, Sling.

up was very of of growing high during services the a adds and prior have long It to viewing. accelerated at where it it tremendous to a You the tail amount growing all and pandemic, pandemic. only viewing CAGRs

massively obviously, absolutely is of and forever. distribution form So growing this a critical

in on it. And all so a as company, we are

So deals with publishers, remember, some in Jim. case, we had

puts So are, often them we streaming we've with a let's publisher say, a their in are services. than there And their channel, services some sold that deals have other depending on what these channel, many ads then cable of like services for are. on those appear their they that will in inventory we ads,

the just it's it's the is, inventory but long about our tail with where So of publishers' about it's services services, our services. with a not the deals deals

to some services selling ads silent the for ads trafficking cases, we're that, them themselves. So in is and

short As were goal growth, environment because how the plan of our profitable. a our that it are in despite relates to had was. we of revenue bad we massive XXXX profitability, we Obviously, advertising

if we're grow invest impacted going the space that me, asked time. will going a question, little to long profitable. business, such But big margin years term. earlier our we're we So come, bit, we've it got up over but to scale profitable. opportunities that the to growth to had invest for And for to the a to stay We're it's somebody

is. it OTT I relates to CAGR large, to company, of the what overall is it size couldn't what enormous tell was. the for a be in just it's exactly the But you As advertising the revenue opportunity pretty what at going CAGR, and look

be So pie out to take. we of figure what us up to will it share can that

Jim Goss

creating. to example, is And I'd sort I effort some that content is It first group content It of Crime of repurposing looks like Twist was that. news Twist. one True does seems like And relative it entertainment. actual created the various of to a your handled, in Network, do like area. to bring importance thought area your of for in to a would other syndication active for plan the out bit more getting more really sound area, economics not you programming like anything what talk you'd women's could revenues whole that wonder on characterize you this and little And focused how types if I on there, be its you're profitability.

Dave Lougee

will on But all we'll our we those moving at will. under cover up Right very ways networks, unsoft of the multicast those Studios effective moment, that Twist, now the from of the leverage is, out primes in on of very our fact Crime on now, those content, and We're content. Quest which local But of library those time, content. of stages show does the True on right, be it's stories. some little. the that. shelf ways Network all are Jim, We're stories, archives those nearly soon, pulling often TV podcast, all Vault brand, and Crime. have the to into XX% video to of at True True three much So podcasting. digital and stations, you're over country which And off got early leveraging up top working already Crime genre we to of on monetize large over that the don't matter the build almost we're that them enough pretty Crime, off studios across and But cost True

it's So it's both a for us. a virtual of win win --

one. a time, is And it come of programming cost day the get that can for from to out channels into to enough so profitable from going we it And there's almost libraries. mix period and there of the

Operator

any to queued call back questions this or over closing to for the at are turn It I'd phone no remarks. further appears there like our the additional speakers time.

Dave Lougee

everyone. more and have All time for that decisions company the are several lot have years in model, XXXX me, with of we taking last confident during the to the operations from Board as in our management today. consistently as customers this past than as the right. and incredible over Thank you, especially join positioned year our made Thanks and us country to what's forward heard been our this in you've Victoria that And and we environment look business critical well what no optimism matter XXXX. face, and all our country. beyond have strong our business us a across to our resilient of and We communities ever and be ahead the both to for

creating the of As for our and we communities continue of good live serve. we to to value greater our serving up to purpose focus on shareholders the

you thanks (XXX) Have questions, please have additional good reach And time your again, day. Kuckelman out today. Doug to If at for XXX-XXXX. a

Operator

for participation. you much Thank very this Ladies gentlemen, call. does and today's conclude your

now You may disconnect.

TEGNA (TGNA) 1 Mar 212020 Q4 Earnings call transcript