October 26, 2020
A. H. Belo Corporation Announces Third Quarter 2020 Financial Results
DALLAS – A. H. Belo Corporation (NYSE: AHC) today reported a third quarter 2020 net loss of $0.1 million, or $(0.00) per share, and an operating loss of $2.4 million. In the third quarter of 2019, the Company reported a net loss of $4.0 million, or $(0.19) per share, and an operating loss of $7.0 million.
For the third quarter of 2020, on a non-GAAP basis, A. H. Belo reported an operating loss adjusted for certain items (“adjusted operating loss”) of $0.1 million, an improvement of $1.4 million or 92.2 percent when compared to an adjusted operating loss of $1.6 million reported in the third quarter of 2019.
Robert W. Decherd, chairman, president and Chief Executive Officer, said, “The events of 2020 continue to create challenges for managing A. H. Belo’s businesses while we remain attentive to the longer term strategies that will enable the Company to become a sustainably profitable digital media enterprise. Colleagues throughout the Company have responded to the many effects of the coronavirus pandemic with ingenuity and resolve, and everyone has made sacrifices to ensure that our communities receive the highest quality news, information and insights possible. As the country enters the next phase of the pandemic this fall and winter, we expect operating conditions to remain mostly the same. The Company’s balance sheet continues to be a significant advantage.”
Third Quarter Results
Total revenue was $37.7 million in the third quarter of 2020, a decrease of $5.3 million or 12.3 percent when compared to the third quarter of 2019.
Revenue from advertising and marketing services, including print and digital revenues, was $17.5 million in the third quarter of 2020, a decrease of $4.1 million or 19.2 percent when compared to the $21.6 million reported for the third quarter of 2019.
Circulation revenue was $16.1 million, a decrease of $0.7 million or 4.2 percent when compared to the third quarter of 2019. The decline is primarily due to a decrease in home delivery and single copy volumes, partially offset by rate increases and an increase of $0.4 million or 34.5 percent in digital-only subscription revenue.
Printing, distribution and other revenue decreased $0.5 million, or 10.3 percent, to $4.2 million, primarily due to a reduction in brokered and commercial printing, partially offset by an increase in shared mail packaging revenue.
Total consolidated operating expense in the third quarter of 2020, on a GAAP basis, was $40.2 million, a decrease of $9.9 million or 19.7 percent compared to the third quarter of 2019. Excluding the 2019 loss of $2.9 million from asset disposals and impairments, the improvement is primarily due to decreases of $3.0 million in employee compensation and benefits expense, $1.5 million in newsprint, ink and other supplies expense, and $1.1 million in outside services expense.
In the third quarter of 2020, on a non-GAAP basis, adjusted operating expense was $41.0 million, an improvement of $7.1 million or 14.7 percent when compared to $48.1 million of adjusted operating expense in the third quarter of 2019. The improvement is primarily due to expense decreases in employee compensation and benefits, newsprint expense, and reductions from continued management of discretionary spending.
As of September 30, 2020, the Company had 750 employees, a decrease of 120 or 13.8 percent when compared to the prior year period. Cash and cash equivalents were $43.2 million and the Company had no debt.
Non-GAAP Financial Measures
Reconciliations of operating income (loss) to adjusted operating loss, total net operating revenue to adjusted operating revenue, and total operating costs and expense to adjusted operating expense are included in the exhibits to this release.
Financial Results Conference Call
A. H. Belo Corporation will conduct a conference call on Tuesday, October 27, 2020, at 9:00 a.m. CDT to discuss financial results. The conference call will be available via webcast by accessing the Company’s website at www.ahbelo.com/invest. An archive of the webcast will be available at www.ahbelo.com in the Investor Relations section.
To access the listen-only conference call, dial 1-877-226-8152 and enter the following access code when prompted: 4445036. A replay line will be available at 1-866-207-1041 from 12:00 p.m. CDT on October 27, 2020 until 11:59 p.m. CST on November 2, 2020. The access code for the replay is 5679783.
About A. H. Belo Corporation
A. H. Belo Corporation is the leading local news and information publishing company in Texas. The Company has a growing presence in emerging media and digital marketing, and maintains capabilities related to commercial printing, distribution and direct mail. A. H. Belo delivers news and information in innovative ways to a broad range of audiences with diverse interests and lifestyles. For additional information, visit www.ahbelo.com or email firstname.lastname@example.org.
Statements in this communication concerning A. H. Belo Corporation’s business outlook or future economic performance, revenues, expenses, and other financial and non-financial items that are not historical facts, are “forward-looking statements” as the term is defined under applicable federal securities laws. Forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those statements. Such risks, trends and uncertainties are, in most instances, beyond the Company’s control, and include changes in advertising demand and other economic conditions; consumers’ tastes; newsprint prices; program costs; labor relations; cybersecurity incidents; technological obsolescence; and the current and future impacts of the COVID-19 public health crisis. Among other risks, there can be no guarantee that the board of directors will approve a quarterly dividend in future quarters; as well as other risks described in the Company’s Annual Report on Form 10-K and in the Company’s other public disclosures and filings with the Securities and Exchange Commission. Forward-looking statements, which are as of the date of this filing, are not updated to reflect events or circumstances after the date of the statement.