LEE ENTERPRISES, Inc - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - August 3, 2018

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Exhibit 99.1 - Supplemental Financial Information – Third fiscal quarter ended June 24, 2018.

leelogo2013a01a01a03a02a03.jpg
201 N. Harrison St.
Davenport, IA 52801
www.lee.net





13 Weeks Ended (unaudited)
 
 
 
 
 
 
 
 
June 24, 2018
 
June 25, 2017
(in thousands)
Consolidated
Lee Legacy
Pulitzer Inc.
 
Consolidated
Lee Legacy
Pulitzer Inc.
Operating revenue:
 
 
 
 
 
 
 
Advertising and marketing services
73,538

51,195

22,343

 
81,247

56,393

24,854

Subscription
48,165

33,438

14,727

 
47,410

32,757

14,653

Other
10,915

9,216

1,699

 
10,698

8,859

1,839

Total operating revenue
132,618

93,849

38,769

 
139,355

98,009

41,346

Operating expenses:
 
 
 
 
 
 
 
Compensation
47,862

36,330

11,532

 
51,577

39,702

11,875

Newsprint and ink
6,442

4,616

1,826

 
6,123

4,234

1,889

Other operating expenses
49,159

29,325

19,834

 
48,571

29,236

19,335

Depreciation and amortization
7,904

5,133

2,771

 
10,296

7,392

2,904

Loss (gain) on sale of assets and other, net
101

101

—

 
(61
)
(3
)
(58
)
Restructuring costs and other
1,865

1,502

363

 
3,902

3,664

238

Total operating expenses
113,333

77,007

36,326

 
120,408

84,225

36,183

Equity in earnings of associated companies
1,578

695

883

 
1,616

645

971

Operating income
20,863

17,537

3,326

 
20,563

14,429

6,134

Non-operating income (expense), net
(14,141
)
(16,553
)
2,412

 
(12,433
)
(13,908
)
1,475

Income tax expense (benefit)
1,972

(112
)
2,084

 
1,843

(921
)
2,764

Net income
4,750

1,096

3,654

 
6,287

1,442

4,845


Adjusted EBITDA is a non-GAAP financial measure. Below is a reconciliation of adjusted EBITDA to net income, the most directly comparable measure under GAAP:
Net Income
4,750

1,096

3,654

 
6,287

1,442

4,845

Adjusted to exclude
 
 
 
 
 
 
 
Non-operating expenses (income), net
14,141

16,553

(2,412
)
 
12,433

13,908

(1,475
)
Income tax expense (benefit)
1,972

(112
)
2,084

 
1,843

(921
)
2,764

Equity in earnings of TNI and MNI
(1,578
)
(695
)
(883
)
 
(1,616
)
(645
)
(971
)
Depreciation and amortization
7,904

5,133

2,771

 
10,296

7,392

2,904

Loss (gain) on sale of assets and other, net
101

101

—

 
(61
)
(3
)
(58
)
Restructuring costs and other
1,865

1,502

363

 
3,902

3,664

238

Stock compensation
425

425

—

 
481

481

—

Add:
 
 
 
 
 
 
 
Ownership share of TNI and MNI EBITDA (50%)
2,189

1,202

987

 
2,246

1,170

1,076

Adjusted EBITDA
31,769

25,205

6,564

 
35,811

26,488

9,323

 
 
 
 
 
 
 
 
Supplemental cash flow information
 
 
 
 
 
Distributions from MNI and TNI
1,677

500

1,177

 
1,713

500

1,213

Capital expenditures
(1,827
)
(1,191
)
(636
)
 
(1,153
)
(1,033
)
(120
)
Cash income tax payments
(145
)
(135
)
(10
)
 
(441
)
(441
)
—

Interest income
113

(2,299
)
2,412

 
77

(1,398
)
1,475

Interest to be settled in cash
(12,913
)
(9,758
)
(3,155
)
 
(14,330
)
(10,565
)
(3,765
)
Debt financing and administrative costs
(427
)
(427
)
—

 
(371
)
(371
)
—






39 Weeks Ended (unaudited)
 
 
 
 
 
 
 
 
June 24, 2018
 
June 25, 2017
(in thousands)
Consolidated
Lee Legacy
Pulitzer Inc.
 
Consolidated
Lee Legacy
Pulitzer Inc.
Operating revenue:
 
 
 
 
 
 
 
Advertising and marketing services
229,751

160,563

69,188

 
251,815

175,099

76,716

Subscription
142,405

98,405

44,000

 
141,306

98,123

43,183

Other
32,052

26,750

5,302

 
33,610

27,829

5,781

Total operating revenue
404,208

285,718

118,490

 
426,731

301,051

125,680

Operating expenses:
 
 
 
 
 
 
 
Compensation
147,428

112,590

34,838

 
159,047

121,893

37,154

Newsprint and ink
17,920

12,754

5,166

 
19,216

13,415

5,801

Other operating expenses
148,830

89,526

59,304

 
150,109

88,697

61,412

Depreciation and amortization
23,973

15,595

8,378

 
30,993

22,192

8,801

Gain on sale of assets and other, net
(1,197
)
(1,170
)
(27
)
 
(3,777
)
(3,718
)
(59
)
Restructuring costs and other
4,150

3,566

584

 
6,372

5,286

1,086

Total operating expenses
341,104

232,861

108,243

 
361,960

247,765

114,195

Equity in earnings of associated companies
5,569

2,023

3,546

 
6,034

2,246

3,788

Operating income
68,673

54,880

13,793

 
70,805

55,532

15,273

Non-operating income (expense), net
(42,853
)
(49,511
)
6,658

 
(36,447
)
(39,632
)
3,185

Income tax expense (benefit)
(16,791
)
(24,219
)
7,428

 
9,253

2,549

6,704

Net income
42,611

29,588

13,023

 
25,105

13,351

11,754


Adjusted EBITDA is a non-GAAP financial measure. Below is a reconciliation of adjusted EBITDA to net income, the most directly comparable measure under GAAP:
Net Income
42,611

29,588

13,023

 
25,105

13,351

11,754

Adjusted to exclude
 
 
 
 
 
 
 
Non-operating expenses (income), net
42,853

49,332

(6,479
)
 
36,447

39,632

(3,185
)
Income tax expense (benefit)
(16,791
)
(24,219
)
7,428

 
9,253

2,549

6,704

Equity in earnings of TNI and MNI
(5,569
)
(1,781
)
(3,788
)
 
(6,034
)
(2,246
)
(3,788
)
Depreciation and amortization
23,973

15,595

8,378

 
30,993

22,192

8,801

Gain on sale of assets and other, net
(1,197
)
(1,170
)
(27
)
 
(3,777
)
(3,718
)
(59
)
Restructuring costs and other
4,150

3,566

584

 
6,372

5,286

1,086

Stock compensation
1,441

1,441

—

 
1,564

1,564

—

Add:
 
 
 
 
 
 
 
Ownership share of TNI and MNI EBITDA (50%)
7,433

3,574

3,859

 
7,943

4,917

3,026

Adjusted EBITDA
98,904

75,926

22,978

 
107,866

83,527

24,339

 
 
 
 
 
 
 
 
Supplemental cash flow information:
 
 
 
 
 
Distributions from MNI and TNI
6,875

2,500

4,375

 
6,384

2,750

3,634

Capital expenditures
(4,281
)
(3,131
)
(1,150
)
 
(3,232
)
(2,912
)
(320
)
Cash income tax payments
(429
)
(364
)
(65
)
 
(1,080
)
(1,076
)
(4
)
Interest income
335

(6,144
)
6,479

 
261

(2,924
)
3,185

Interest to be settled in cash
(39,837
)
(29,941
)
(9,896
)
 
(43,919
)
(32,362
)
(11,557
)
Debt financing and administrative costs
(432
)
(432
)
—

 
(371
)
(371
)
—



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