April 26, 2021
A. H. Belo Corporation Announces First Quarter 2021 Financial Results
DALLAS – A. H. Belo Corporation (NYSE: AHC) today reported a first quarter 2021 net loss of $2.8 million, or $(0.13) per share, and an operating loss of $3.7 million. In the first quarter of 2020, the Company reported a net loss of $1.6 million, or $(0.08) per share, and an operating loss of $4.8 million. The 2020 net loss included a federal tax refund of $2.3 million permitted under the CARES Act.
For the first quarter of 2021, on a non-GAAP basis, A. H. Belo reported an operating loss adjusted for certain items (“adjusted operating loss”) of $2.4 million, an improvement of $0.4 million or 14.4 percent when compared to an adjusted operating loss of $2.8 million reported in the first quarter of 2020.
Robert W. Decherd, chairman, president and Chief Executive Officer, said, “We are encouraged that operating conditions have settled to some extent during the first part of 2021. However, it is obviously important to remain focused on revenue generation across all platforms while shaping the Company’s expense structure to reflect the smaller enterprise A. H. Belo has become. On April 15 we announced a voluntary severance offer (VSO) for eligible employees in select departments, which is an important step in this process. The VSO should help accelerate the realignment of administrative, back office and production activities, and result in meaningful ongoing savings.
“The Dallas Morning News continues to provide superior, unduplicated local and regional news, information and commentary. The impact is seen in The News’ growth in digital memberships and the relative stability of its print member base. The Board’s commitment to investing in this growth is the best pathway to becoming a sustainably profitable digital newspaper enterprise.”
First Quarter Results
Total revenue was $36.8 million in the first quarter of 2021, a decrease of $3.5 million or 8.7 percent when compared to the first quarter of 2020.
Revenue from advertising and marketing services, including print and digital revenues, was $16.8 million in the first quarter of 2021, a decrease of $2.6 million or 13.2 percent when compared to the $19.3 million reported for the first quarter of 2020. The decline is primarily due to a $1.6 million reduction in print advertising revenue, which has been significantly impacted by the COVID-19 pandemic.
Circulation revenue was $16.0 million, a decrease of $0.4 million or 2.4 percent when compared to the first quarter of 2020. Home delivery revenue decreased 4.3 percent and single copy revenue decreased 27.1 percent, primarily due to the significantly reduced number of locations selling newspapers as a result of the pandemic, partially offset by an increase of $0.6 million or 46.5 percent in digital-only subscription revenue.
Printing, distribution and other revenue decreased $0.6 million, or 12.6 percent, to $4.0 million, primarily due to reductions in commercial printing and distribution revenue.
Total consolidated operating expense in the first quarter of 2021, on a GAAP basis, was $40.5 million, an improvement of $4.6 million or 10.2 percent compared to the first quarter of 2020. The improvement is primarily due to expense decreases of $1.1 million in employee compensation and benefits, $0.9 million in newsprint, ink and other supplies, $0.9 million in outside services, $0.7 million in depreciation, $0.4 million in distribution, and $0.3 million in travel and entertainment.
In the first quarter of 2021, on a non-GAAP basis, adjusted operating expense was $45.3 million, an increase of $0.8 million or 1.7 percent when compared to $44.6 million of adjusted operating expense in the first quarter of 2020. The increase is primarily due to an increase of $4.7 million in contra expense, partially offset by expense decreases in employee compensation and benefits, newsprint, distribution, and reductions from continued management of discretionary spending.
As of March 31, 2021, the Company had 713 employees, a decrease of 75 or 9.5 percent when compared to the prior year period. Cash and cash equivalents were $38.1 million and the Company had no debt.
Non-GAAP Financial Measures
Reconciliations of operating loss to adjusted operating loss, total net operating revenue to adjusted operating revenue, and total operating costs and expense to adjusted operating expense are included in the exhibits to this release.
Financial Results Conference Call
A. H. Belo Corporation will conduct a conference call on Tuesday, April 27, 2021, 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 1-877-226-8189 and enter the following access code when prompted: 5840199. A replay line will be available at 1-866-207-1041 from 12:00 p.m. CDT on April 27, 2021 until 11:59 p.m. CDT on May 3, 2021. The access code for the replay is 8305657.
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, including statements of the Company’s expectations relating to its plans to regain NYSE compliance, 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.