Part I [Business](index=3&type=section&id=Item%201.%20Business) TEGNA Inc. is a media company operating 64 television stations across 51 U.S. markets, generating revenue primarily from subscription fees, advertising, and political advertising [Business Overview](index=3&type=section&id=Business%20Overview) TEGNA operates 64 television stations and two radio stations in 51 U.S. markets, reaching 39% of U.S. TV households and operating digital advertising services - Operates **64 television stations** and **two radio stations** in **51 U.S. markets**, reaching approximately **39% of U.S. television households**[9](index=9&type=chunk) - TEGNA is the largest owner of top four network affiliates in the top 25 U.S. markets among independent station groups[9](index=9&type=chunk) [Terminated Merger Agreement](index=3&type=section&id=Terminated%20Merger%20Agreement) TEGNA terminated its merger agreement with Teton Parent Corp. due to regulatory review, receiving a $136.0 million termination fee - The Merger Agreement with Teton Parent Corp., initiated on February 22, 2022, was terminated on **May 22, 2023**[10](index=10&type=chunk)[11](index=11&type=chunk) - TEGNA received a termination fee of **$136.0 million**, satisfied by the transfer of **8.6 million shares** of its own common stock from the acquirer[11](index=11&type=chunk) [Operating Structure and Revenue Sources](index=3&type=section&id=Operating%20Structure%20and%20Revenue%20Sources) TEGNA operates as a single segment, generating $2.9 billion in 2023, with revenue from subscription fees, advertising, and political advertising Primary Revenue Sources | Revenue Source | Description | | :--- | :--- | | **Subscription** | Fees from satellite, cable, and OTT providers for carrying TV signals | | **Advertising & Marketing Services (AMS)** | Local/national non-political TV ads, digital marketing (including Premion), and website/app advertising | | **Political Advertising** | Driven by even-year election cycles | | **Other Services** | Program production, tower rentals, and content distribution | [Our Strategy](index=5&type=section&id=Our%20Strategy) TEGNA's five-pillar strategy focuses on operational excellence, M&A, organic growth, a strong balance sheet, and robust free cash flow for shareholder returns - The company's strategy is built on five pillars: being a best-in-class operator, pursuing accretive M&A, driving organic growth through innovation, maintaining a strong balance sheet, and optimizing capital allocation[22](index=22&type=chunk) - Successfully renewed multi-year distribution agreements with major networks: ABC (through late 2026), NBC (through early 2027), CBS (through late 2028), and Fox (through mid 2025)[19](index=19&type=chunk) - Premion, its OTT advertising service launched in 2016, operates in all 210 Designated Market Areas (DMAs) in the U.S. and acquired Octillion Media in early 2024[31](index=31&type=chunk)[30](index=30&type=chunk) - As of December 31, 2023, the company maintained a net leverage ratio below **3.0x** and had liquidity of **$1.11 billion**, with no near-term debt maturities until 2026[36](index=36&type=chunk) - A new capital allocation framework aims to return **40-60% of free cash flow** from 2024-2025 to shareholders via dividends and share repurchases[43](index=43&type=chunk) [Our Competition](index=8&type=section&id=Our%20Competition) TEGNA faces intense competition for advertising revenue from traditional and digital platforms, and for subscription revenue from other broadcasters and streaming services - Competes for advertising revenue with other TV platforms (broadcast, cable) and digital giants like Google, Facebook, and YouTube[49](index=49&type=chunk) - Competes for subscription revenue against other broadcast stations, cable networks, and internet-based video content providers such as Amazon Prime, Disney+, Max, Hulu, and Netflix[50](index=50&type=chunk) [Our Regulatory Environment](index=9&type=section&id=Our%20Regulatory%20Environment) TEGNA's operations are governed by FCC regulations, including broadcast license terms, ownership restrictions, and retransmission consent rules - Broadcast licenses are granted for **eight-year periods** and are renewable upon application to the FCC[53](index=53&type=chunk) - The national ownership cap prohibits any single entity from reaching more than **39% of U.S. television households**; TEGNA's reach is approximately **39.3%** without the UHF discount and **30.0%** with it[58](index=58&type=chunk) - The company is voluntarily transitioning to the NextGen TV (ATSC 3.0) standard and, as of year-end 2023, was broadcasting in both ATSC 1.0 and 3.0 formats in **21 markets**[60](index=60&type=chunk) [Our Human Capital](index=11&type=section&id=Our%20Human%20Capital) TEGNA employed approximately 6,200 people as of December 31, 2023, with DE&I goals for 2025 and 9% of its workforce unionized - Employed approximately **6,200 full-time and part-time people** as of December 31, 2023[65](index=65&type=chunk) 2025 Diversity & Inclusion Goals and 2023 Progress | Category | 2025 Goal | 2023 Progress (BIPOC %) | | :--- | :--- | :--- | | **Content Teams** | Reflect markets (~36%) | 33% | | **Content Leadership** | Increase by 50% | 24% (from 17% in 2021) | | **Company Leadership** | Increase by 50% | 21% (from 16% in 2021) | - Approximately **9% of employees** are represented by labor unions under 27 local collective bargaining agreements[80](index=80&type=chunk) [Our Corporate Responsibility and Sustainability](index=17&type=section&id=Our%20Corporate%20Responsibility%20and%20Sustainability) TEGNA's corporate responsibility focuses on environmental stewardship, social impact through journalism and community support, and strong corporate governance - The company's reporting is aligned with Sustainability Accounting Standards Board (SASB) guidelines for the Media & Entertainment industry[93](index=93&type=chunk) - Through the TEGNA Foundation's Community Grants program, stations made **385 grants totaling $1.85 million** in 2023, primarily supporting health, education, and hunger initiatives[107](index=107&type=chunk)[108](index=108&type=chunk) - TEGNA stations help raise over **$100 million annually** for diverse local causes[108](index=108&type=chunk) - The Board of Directors is led by an independent chair, with **eight out of nine directors** being independent[121](index=121&type=chunk) [Risk Factors](index=25&type=section&id=Item%201A.%20Risk%20Factors) TEGNA faces risks from advertising demand, competition, cybersecurity, system failures, network affiliation renewals, regulatory changes, and asset impairment - Advertising revenue, which constituted **44% of 2023 revenues**, is highly dependent on economic strength and subject to cyclicality from political election cycles[129](index=129&type=chunk)[131](index=131&type=chunk) - Subscription revenue from retransmission consent agreements represented approximately **52% of 2023 total revenues**, and failure to renew these agreements could negatively impact financial results[139](index=139&type=chunk) - Goodwill and other intangible assets were approximately **$5.31 billion** as of December 31, 2023, representing about **76% of total assets**, which are subject to impairment risk[149](index=149&type=chunk) - The company faces risks from potential changes in FCC regulations, which could impact media ownership rules, retransmission negotiations, and opportunities for growth[141](index=141&type=chunk)[143](index=143&type=chunk) [Unresolved Staff Comments](index=29&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments - None[154](index=154&type=chunk) [Cybersecurity](index=29&type=section&id=Item%201C.%20Cybersecurity) TEGNA's cybersecurity program, aligned with NIST, is overseen by its CTO and Board, with quarterly updates and annual risk assessments - The company's cybersecurity strategy is aligned with the NIST Cybersecurity Framework and is overseen at a high level by the Senior Vice President and Chief Technology Officer[155](index=155&type=chunk)[156](index=156&type=chunk) - The Board of Directors receives quarterly and annual cybersecurity updates and oversees the annual enterprise risk assessment[155](index=155&type=chunk) [Properties](index=29&type=section&id=Item%202.%20Properties) TEGNA owns and leases offices, studios, and tower sites for its television stations, with corporate headquarters in Tysons, VA - The company owns and leases properties such as offices, studios, and transmitter sites to support its television stations[160](index=160&type=chunk) - The corporate headquarters in Tysons, VA is a leased facility[160](index=160&type=chunk) [Legal Proceedings](index=29&type=section&id=Item%203.%20Legal%20Proceedings) Information regarding the company's legal proceedings is provided in Note 11 of the Notes to the consolidated financial statements - Details on legal proceedings are available in Note 11 to the consolidated financial statements[162](index=162&type=chunk) [Mine Safety Disclosures](index=29&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[163](index=163&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=31&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) TEGNA's common stock trades on NYSE (TGNA); the company executed significant share repurchases and increased dividends in 2023, with a new capital allocation framework for 2024-2025 - As of February 26, 2024, there were approximately **176.1 million shares** of common stock outstanding held by **5,483 shareholders of record**[164](index=164&type=chunk) - In 2023, the company executed two Accelerated Share Repurchase (ASR) programs totaling **$625 million**[166](index=166&type=chunk)[167](index=167&type=chunk) - In December 2023, the Board authorized a new share repurchase program for up to **$650.0 million** through December 31, 2025[168](index=168&type=chunk) - The quarterly dividend was increased by **20%** from **9.5 cents to 11.375 cents per share** in Q2 2023[173](index=173&type=chunk) - A new capital allocation framework for 2024-2025 aims to return **40-60% of free cash flow** to shareholders through dividends and buybacks[174](index=174&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2023, TEGNA's revenues decreased 11% to $2.91 billion due to lower political and AMS advertising, while operating income fell 26% to $733.5 million, partially offset by a merger termination fee [Consolidated Results from Operations](index=35&type=section&id=Consolidated%20Results%20from%20Operations) TEGNA's 2023 revenues decreased 11% to $2.91 billion, with operating income down 26% to $733.5 million, and net income falling 25% to $476.3 million Consolidated Financial Summary (in thousands, except per share data) | Metric | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | **Revenues** | $2,910,930 | $3,279,245 | (11%) | | **Operating Income** | $733,545 | $990,632 | (26%) | | **Net Income** | $476,347 | $631,198 | (25%) | | **Diluted EPS** | $2.28 | $2.81 | (19%) | - The decrease in revenue was primarily driven by a **$295.3 million decline in political revenue** due to the absence of the 2022 mid-term election cycle[195](index=195&type=chunk) - Operating expenses were reduced by a **$136.0 million merger termination fee** received in Q2 2023[205](index=205&type=chunk)[206](index=206&type=chunk) [Operating results non-GAAP information](index=41&type=section&id=Operating%20results%20non-GAAP%20information) Adjusted EBITDA for 2023 was $742.3 million, a 34% decrease, with two-year free cash flow at $1.26 billion, representing 20.3% of revenue Adjusted EBITDA Reconciliation (in thousands) | Metric | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | **Net income attributable to TEGNA Inc. (GAAP)** | $476,724 | $630,469 | (24%) | | **Adjusted EBITDA (non-GAAP)** | $742,340 | $1,131,903 | (34%) | Free Cash Flow (Two-Year Period Ended Dec. 31) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | **Free cash flow (non-GAAP basis)** | $1,255,261 | $1,373,664 | | **Revenue** | $6,190,175 | $6,270,338 | | **Free cash flow as a % of revenue** | 20.3% | 21.9% | [FINANCIAL POSITION, Liquidity and capital resources](index=46&type=section&id=FINANCIAL%20POSITION%2C%20Liquidity%20and%20capital%20resources) TEGNA ended 2023 with $361.0 million in cash, $3.07 billion in fixed-rate debt, a 2.81x leverage ratio, and amended its revolving credit facility in January 2024 Cash Flow Summary (in thousands) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | **Net cash flow from operating activities** | $587,249 | $812,151 | | **Net cash flow used for investing activities** | ($27,989) | ($51,232) | | **Net cash flow used for financing activities** | ($749,905) | ($266,227) | | **Cash and cash equivalents at end of year** | $361,036 | $551,681 | - Total long-term debt principal was **$3.09 billion** as of December 31, 2023, with the next maturity of **$550 million** due in 2026[253](index=253&type=chunk)[259](index=259&type=chunk) - The company's leverage ratio was **2.81x** as of December 31, 2023, significantly below the **4.50x covenant limit**[257](index=257&type=chunk) - In January 2024, the revolving credit facility was amended to reduce its size from **$1.51 billion to $750 million** and extend its term to January 2029[255](index=255&type=chunk)[384](index=384&type=chunk) [Critical accounting policies and estimates](index=51&type=section&id=Critical%20accounting%20policies%20and%20estimates) TEGNA's critical accounting policies involve significant judgment for goodwill and indefinite-lived intangible assets, pension liabilities, and income taxes - Goodwill (**$2.98 billion**) and indefinite-lived intangible assets (**$2.12 billion**) comprised approximately **43% and 30% of total assets**, respectively, as of December 31, 2023[268](index=268&type=chunk)[275](index=275&type=chunk) - The 2023 annual goodwill impairment test indicated the fair value of the company's single reporting unit exceeded its carrying value by more than **20%**[273](index=273&type=chunk) - Quantitative and qualitative impairment tests for FCC broadcast licenses in 2023 resulted in no impairment charges[277](index=277&type=chunk)[278](index=278&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=54&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) TEGNA's primary market risk is interest rates; all long-term debt was fixed-rate as of December 31, 2023, with future revolving credit facility borrowings subject to variable rates - As of December 31, 2023, the company had no outstanding floating interest rate obligations[290](index=290&type=chunk) - In January 2024, the revolving credit facility was amended, reducing its size to **$750 million** and extending its term to 2029; future borrowings will be subject to a variable interest rate[291](index=291&type=chunk)[292](index=292&type=chunk) [Financial Statements and Supplementary Data](index=55&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section includes TEGNA's audited consolidated financial statements for 2023, along with the independent auditor's report and accompanying notes - The independent auditor, PricewaterhouseCoopers LLP, issued an unqualified opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting as of December 31, 2023[299](index=299&type=chunk) - The critical audit matter identified was the quantitative impairment assessment for certain FCC broadcast licenses, due to the significant management judgment involved in estimating their fair value[306](index=306&type=chunk)[307](index=307&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=88&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[448](index=448&type=chunk) [Controls and Procedures](index=88&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that TEGNA's disclosure controls and internal control over financial reporting were effective as of December 31, 2023 - Management concluded that the company's disclosure controls and procedures were effective as of December 31, 2023[449](index=449&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2023[450](index=450&type=chunk) [Other Information](index=88&type=section&id=Item%209B.%20Other%20Information) The company reports no other information for this item - None[453](index=453&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=88&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to the company - None[454](index=454&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=89&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information regarding directors, executive officers, and corporate governance is incorporated by reference from the company's 2024 definitive proxy statement - Information is incorporated by reference from the 2024 proxy statement[456](index=456&type=chunk) [Executive Compensation](index=89&type=section&id=Item%2011.%20Executive%20Compensation) Information regarding executive compensation is incorporated by reference from the company's 2024 definitive proxy statement - Information is incorporated by reference from the 2024 proxy statement[457](index=457&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=89&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information regarding security ownership and related stockholder matters is incorporated by reference from the company's 2024 definitive proxy statement - Information is incorporated by reference from the 2024 proxy statement[458](index=458&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=89&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information regarding certain relationships, related transactions, and director independence is incorporated by reference from the company's 2024 definitive proxy statement - Information is incorporated by reference from the 2024 proxy statement[459](index=459&type=chunk) [Principal Accountant Fees and Services](index=89&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information regarding principal accountant fees and services is incorporated by reference from the company's 2024 definitive proxy statement - Information is incorporated by reference from the 2024 proxy statement[460](index=460&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=90&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the financial statements, financial statement schedules, and exhibits filed as part of the Form 10-K report - This section provides an index of all financial statements and exhibits filed with the annual report[461](index=461&type=chunk)[464](index=464&type=chunk) [Form 10-K Summary](index=99&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company provides no summary for this item - None[474](index=474&type=chunk)

Financial Data and Key Metrics Changes - Non-GAAP operating expenses for the quarter were $577 million, down 2% compared to Q4 2022, and down 4% when excluding programming costs, driven by lower variable costs of sales for digital revenue and operational expense management improvements [1] - Total revenue for Q4 2023 was down 21%, primarily due to the absence of cyclical political revenue from the midterm elections in 2022 and a temporary service disruption [77] - Full year 2023 total revenue finished at $2.9 billion, down 11% year-over-year due to the cyclical reduction of political ad revenue [77] - Adjusted EBITDA for Q4 was $177 million, producing a 24% margin, while full year adjusted EBITDA was $742 million, producing a 26% margin [51] Business Line Data and Key Metrics Changes - Subscription revenue for full year 2023 was over $1.5 billion, in line with the prior year, driven by rate increases but offset by subscriber declines and service disruptions [78] - Advertising trends in Q4 showed sequential improvement, particularly in automotive and services, which are the two largest ad categories [34] - Premion's local revenue growth remained strong, finishing up double digits for the full year, while overall Premion revenue was down year-over-year due to the loss of a large national account [50][81] Market Data and Key Metrics Changes - The company expects to generate free cash flow in the range of $900 million to $1.1 billion during the period of 2024-2025, reflecting confidence in the visibility and durability of cash flows [27][82] - The company has network affiliate agreements covering almost all Big 4 subscribers through late 2026, enhancing visibility into revenues and future cash flow [62] Company Strategy and Development Direction - The company is focused on returning capital to shareholders, driving efficiencies, and evaluating growth opportunities following the merger termination [25] - A new comprehensive capital allocation framework has been announced, expecting to return 40% to 60% of free cash flow over the next two years in the form of buybacks and dividends [74] - The acquisition of Octillion Media is expected to enhance Premion's capabilities in local streaming advertising, driving product innovation and operational efficiencies [68][81] Management's Comments on Operating Environment and Future Outlook - Management noted that 2024 will be a strong year driven by key events such as the presidential election cycle, the Summer Olympic Games, and the Super Bowl [2] - The company anticipates that advertising and marketing services will remain flat throughout the year, with local advertising trends remaining strong despite some softness on the national side [54] - Management expressed confidence in the operational efficiencies and cost reduction initiatives expected to yield benefits in the latter half of 2024 and continue through 2025 [52][64] Other Important Information - The company has committed to nearly $800 million of share repurchases and increased dividends by 20% following the merger termination [32][73] - The company ended the year with total debt of $3.1 billion and cash of $361 million, with net leverage at 2.8x, well below the 3x guidance [102] Q&A Session Summary Question: What are the expectations for advertising trends in 2024? - Management indicated that while there is some softness on the national side, local advertising trends remain strong, and they expect overall advertising to be flat throughout the year [54] Question: Can you elaborate on the acquisition of Octillion Media? - The acquisition is expected to enhance Premion's capabilities, allowing for better operational control, greater innovation, and improved EBITDA margins [112] Question: How does the company view the impact of political advertising in 2024? - Management noted that their stations play a fundamental role in political marketing strategies, with a significant presence in battleground states [66][124]

[Report Highlights](index=1&type=section&id=Report%20Highlights) TEGNA's 2023 results surpassed expectations, leading to a new capital allocation framework, significant share repurchase, and a positive 2024 outlook - **Full-year 2023 results** met or exceeded **all guidance metrics**[1](index=1&type=chunk) - A new capital allocation framework aims to return **40-60%** of **2024-2025 free cash flow** to shareholders, expecting a total capital return of **$1.3 billion** from merger termination through 2025[1](index=1&type=chunk) - The Board authorized a new two-year, **$650 million** share repurchase program[1](index=1&type=chunk)[9](index=9&type=chunk) - Received approximately **$153 million** in pre-tax cash proceeds from the sale of its ownership interest in Broadcast Music, Inc (BMI)[1](index=1&type=chunk)[11](index=11&type=chunk) [Financial Performance](index=1&type=section&id=Financial%20Performance) TEGNA's 2023 financial performance reflects cyclical revenue declines due to reduced political advertising and a Q4 subscription disruption [Fourth Quarter 2023 Financial Highlights](index=1&type=section&id=FOURTH%20QUARTER%20FINANCIAL%20HIGHLIGHTS) Q4 2023 revenue declined 21% to $726 million due to absent political revenue and a subscription service disruption, impacting net income and Adjusted EBITDA Q4 2023 Key Financial Metrics (in millions) | Metric | Q4 2023 | Q4 2022 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $726M | $917M | -21% | | Subscription Revenue | $339M | $372M | -9% | | AMS Revenue | $352M | $353M | In-line | | Net Income (GAAP) | $76M | $219M | -65% | | Diluted EPS (GAAP) | $0.40 | $0.97 | -59% | | Adjusted EBITDA | $177M | $361M | -51% | | Free Cash Flow | $130M | $302M | -57% | - Subscription revenue was down **9%** YoY primarily due to a temporary service disruption with a distribution partner, excluding which revenue would have been nearly flat[3](index=3&type=chunk) - Net leverage finished the year at **2.8x**, which is below the full-year guidance of **3.0x**[4](index=4&type=chunk) [Full-Year 2023 Financial Highlights](index=3&type=section&id=FULL-YEAR%20FINANCIAL%20HIGHLIGHTS) Full-year 2023 total revenue decreased 11% to $2.9 billion, driven by reduced political advertising, resulting in lower net income and Adjusted EBITDA Full-Year 2023 Key Financial Metrics (in millions) | Metric | FY 2023 | FY 2022 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $2.9B | $3.3B | -11% | | Subscription Revenue | $1.5B | $1.5B | In-line | | AMS Revenue | $1.3B | $1.4B | -5% | | Net Income (GAAP) | $476M | $631M | -25% | | Diluted EPS (GAAP) | $2.28 | $2.81 | -19% | | Adjusted EBITDA | $742M | $1,132M | -34% | - The YoY revenue decline was also impacted by the absence of the Winter Olympics and Super Bowl on NBC in 2022, compared to the Super Bowl on FOX (TEGNA's smallest affiliate portfolio) in 2023[7](index=7&type=chunk) - Automotive and Services, the two largest advertising categories, generated strong growth throughout 2023[7](index=7&type=chunk) [Outlook and Guidance](index=3&type=section&id=Outlook%20and%20Guidance) TEGNA projects strong 2024-2025 free cash flow, supported by renewals, while anticipating a slight Q1 2024 revenue decline and stable full-year guidance [2024-2025 Free Cash Flow Guidance](index=3&type=section&id=FREE%20CASH%20FLOW%20GUIDANCE%20THROUGH%202024-2025) TEGNA forecasts $900 million to $1.1 billion in free cash flow for 2024-2025, bolstered by renewed agreements and transformation initiatives - The company expects to generate free cash flow in the range of **$900 million to $1.1 billion** during the 2024-2025 period[6](index=6&type=chunk) - Guidance is based on recently renewed affiliation agreements with NBC and ABC, as well as retransmission consent agreements repricing **30%** of traditional subscribers[6](index=6&type=chunk) - Guidance includes the impact of transformation initiatives to streamline operations and achieve cost reductions, with initial benefits expected in H2 2024[7](index=7&type=chunk) [Full-Year and First Quarter 2024 Outlook](index=5&type=section&id=FULL-YEAR%20AND%20FIRST%20QUARTER%202024%20OUTLOOK) TEGNA's 2024 outlook includes a net leverage ratio below 3.0x, with Q1 revenue expected to decrease and operating expenses to increase slightly Full-Year 2024 Key Guidance Metrics | Metric | Guidance | | :--- | :--- | | Net Leverage Ratio | Below 3.0x at year-end | | Corporate Expenses | $40 - $45 million | | Interest Expense | $170 - $173 million | | Capital Expenditures | $62 - $67 million | | Effective Tax Rate | 23.5% - 24.5% | First Quarter 2024 Guidance (vs Q1 2023) | Metric | Guidance | | :--- | :--- | | Total Company GAAP Revenue | Down Low-to-Mid-Single Digit % | | Total Non-GAAP Operating Expenses | Up Low-Single Digit % | [Capital Management and Corporate Strategy](index=4&type=section&id=Capital%20Management%20and%20Corporate%20Strategy) TEGNA's strategy emphasizes shareholder returns, operational efficiency, and strategic growth through a new capital allocation framework, share repurchases, and targeted acquisitions [Capital Allocation Framework & Shareholder Returns](index=4&type=section&id=CAPITAL%20ALLOCATION%20FRAMEWORK) TEGNA's new capital allocation framework aims to return 40-60% of 2024-2025 free cash flow to shareholders, supported by a $650 million share repurchase program - The company will return **40-60%** of its free cash flow generated in 2024-2025 to shareholders through share repurchases and dividends[8](index=8&type=chunk) - A new share repurchase program for up to **$650 million** of common stock has been authorized, expiring on December 31, 2025[9](index=9&type=chunk) - The company received approximately **$153 million** in pre-tax cash from the sale of its BMI interest, which will be used for shareholder returns and/or bolt-on M&A[11](index=11&type=chunk) [CEO Commentary](index=4&type=section&id=CEO%20COMMENT) CEO Dave Lougee highlights TEGNA's strong position, driven by a new capital allocation framework, successful agreement renewals, and transformation initiatives, anticipating a robust 2024 - CEO Dave Lougee described the company as being "back on offense, operating from a position of strength" with a new capital allocation framework to drive shareholder value[12](index=12&type=chunk) - Successful renegotiation of retransmission agreements (**30%** of traditional subs) and affiliation agreements with NBC and ABC provide visibility into future revenues and cash flow, with **93%** of Big 4 network subscribers now under agreements through late 2026 or longer[13](index=13&type=chunk) - The company is leveraging its scale and new technologies to drive efficiencies, with financial benefits expected in the second half of 2024[14](index=14&type=chunk) [Key Strategic Updates](index=6&type=section&id=KEY%20STRATEGIC%20UPDATES) TEGNA's strategic updates include a new credit facility, NBC affiliation renewal, acquisition of Octillion Media for CTV, and investment in 6AM City for local content - Closed a new **$750 million**, five-year amended credit agreement, securing additional capacity for strategic objectives[21](index=21&type=chunk) - Renewed a multi-year affiliation agreement with NBC for **20 markets**, covering nearly **17%** of U.S TV households[21](index=21&type=chunk) - Premion acquired Octillion Media, a Connected TV (CTV) demand-side platform, to expand its capabilities and drive growth in serving local and regional advertisers[21](index=21&type=chunk) - Made a strategic investment in 6AM City, a local media brand, to enhance the distribution of local news and weather content[21](index=21&type=chunk) [Detailed Financials and Reconciliations](index=8&type=section&id=Detailed%20Financials%20and%20Reconciliations) This section presents detailed GAAP financial statements and non-GAAP reconciliations, providing a granular view of revenue, expenses, profitability, and cash flow [Consolidated Statements of Income (GAAP)](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20INCOME) GAAP consolidated statements detail TEGNA's Q4 and full-year 2023 revenues, operating expenses, and net income, showing declines from the prior year Consolidated Income Statement - Full Year (in thousands) | Line Item | 2023 | 2022 | | :--- | :--- | :--- | | Revenues | $2,910,930 | $3,279,245 | | Operating Expenses | $2,177,385 | $2,288,613 | | Operating Income | $733,545 | $990,632 | | Net Income Attributable to TEGNA Inc. | $476,724 | $630,469 | Consolidated Income Statement - Q4 (in thousands) | Line Item | Q4 2023 | Q4 2022 | | :--- | :--- | :--- | | Revenues | $725,854 | $917,130 | | Operating Income | $143,734 | $328,216 | | Net Income Attributable to TEGNA Inc. | $76,133 | $218,601 | [Non-GAAP Reconciliations](index=10&type=section&id=NON-GAAP%20FINANCIAL%20INFORMATION) This section provides detailed reconciliations of GAAP to non-GAAP financial measures, including Adjusted EBITDA, Free Cash Flow, and Net Leverage Ratio, for evaluating ongoing performance Revenue Breakdown by Source - Full Year (in thousands) | Revenue Source | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Subscription | $1,527,563 | $1,530,402 | (0.2)% | | Advertising and Marketing Services | $1,289,903 | $1,363,417 | (5.4)% | | Political | $45,800 | $341,110 | (86.6)% | | Other | $47,664 | $44,316 | 7.6% | | **Total Revenues** | **$2,910,930** | **$3,279,245** | **(11.2)%** | Reconciliation of Net Income to Adjusted EBITDA - Full Year (in thousands) | Line Item | 2023 | 2022 | | :--- | :--- | :--- | | Net income attributable to TEGNA Inc. (GAAP) | $476,724 | $630,469 | | Adjustments (Taxes, Interest, D&A, Special Items, etc.) | $265,616 | $501,434 | | **Adjusted EBITDA (non-GAAP)** | **$742,340** | **$1,131,903** | Net Leverage Ratio Calculation as of Dec 31, 2023 (in thousands) | Component | Value | | :--- | :--- | | Net Debt | $2,728,964 | | T2Y Adjusted EBITDA | $981,304 | | **Net Leverage Ratio** | **2.8x** |

PART I. FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents TEGNA's unaudited condensed consolidated financial statements and detailed notes for the period ended September 30, 2023 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) TEGNA's total assets slightly decreased to **$7.195 billion** as of September 30, 2023, with stable long-term debt Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Sept. 30, 2023 (in thousands) | Dec. 31, 2022 (in thousands) | | :--- | :--- | :--- | | **Total Assets** | **$7,195,049** | **$7,328,896** | | Cash and cash equivalents | $553,030 | $551,681 | | Goodwill | $2,981,587 | $2,981,587 | | **Total Liabilities** | **$4,216,050** | **$4,239,756** | | Long-term debt | $3,071,899 | $3,069,316 | | **Total Equity** | **$2,960,540** | **$3,071,722** | [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income) Q3 2023 revenues decreased to **$713.2 million** and net income to **$96.2 million**, primarily due to lower political advertising revenue Consolidated Income Statement Highlights (in thousands, except EPS) | Metric | Q3 2023 (in thousands) | Q3 2022 (in thousands) | 9 Months 2023 (in thousands) | 9 Months 2022 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | **$713,243** | **$803,111** | **$2,185,076** | **$2,362,115** | | Operating Income | $134,657 | $232,258 | $589,811 | $662,416 | | Merger Termination Fee | - | - | ($136,000) | - | | **Net Income Attributable to TEGNA** | **$96,183** | **$146,065** | **$400,591** | **$411,868** | | **Diluted EPS** | **$0.48** | **$0.65** | **$1.86** | **$1.83** | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash flow from operating activities decreased to **$408.8 million** for the nine months ended September 30, 2023, driven by lower revenue Consolidated Cash Flow Highlights (Nine Months Ended Sept. 30, in thousands) | Cash Flow Category | 2023 (in thousands) | 2022 (in thousands) | | :--- | :--- | :--- | | **Net cash flow from operating activities** | **$408,839** | **$600,705** | | Net cash flow used for investing activities | ($3,095) | ($36,062) | | Net cash flow used for financing activities | ($404,395) | ($244,991) | | **Increase in cash and cash equivalents** | **$1,349** | **$319,652** | [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, the terminated merger, revenue sources, debt, share repurchases, and ongoing litigation - On May 22, 2023, TEGNA terminated its merger agreement with Teton Parent Corp. (an affiliate of Standard General). As a result, TEGNA received a **$136.0 million** termination fee, which was paid via **8.6 million** shares of the company's common stock and recorded as an operating item[21](index=21&type=chunk)[22](index=22&type=chunk) Revenue by Source (in thousands) | Revenue Source | Q3 2023 (in thousands) | Q3 2022 (in thousands) | 9 Months 2023 (in thousands) | 9 Months 2022 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Subscription | $377,891 | $377,368 | $1,188,297 | $1,158,101 | | Advertising & Marketing | $312,413 | $320,764 | $937,984 | $1,010,490 | | Political | $11,643 | $92,904 | $22,925 | $161,727 | | Other | $11,296 | $12,075 | $35,870 | $31,797 | - In Q3 2023, the company sold a portion of its investment in MadHive, Inc. for **$26.4 million**, resulting in a gain of **$25.8 million**[35](index=35&type=chunk) - The company repurchased **$300 million** in shares through an Accelerated Share Repurchase (ASR) program completed in Q3 2023, receiving a total of **18.3 million** shares. An additional **1.7 million** shares were repurchased for **$27.9 million** under a separate program[49](index=49&type=chunk)[50](index=50&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, highlighting Q3 2023 revenue decrease due to lower political advertising and stable liquidity [Consolidated Results from Operations](index=22&type=section&id=Consolidated%20Results%20from%20Operations) Q3 2023 total revenues decreased by **11%** to **$713.2 million**, primarily due to an **87%** drop in political advertising revenue Revenue Comparison (Q3 2023 vs. Q3 2022, in thousands) | Revenue Category | 2023 (in thousands) | 2022 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Subscription | $377,891 | $377,368 | 0% | | Advertising & Marketing Services | $312,413 | $320,764 | (3)% | | Political | $11,643 | $92,904 | (87)% | | **Total revenues** | **$713,243** | **$803,111** | **(11)%** | - The decrease in total revenues for Q3 and the first nine months of 2023 was primarily due to the absence of the 2022 mid-term election cycle, which significantly reduced political revenue[76](index=76&type=chunk) - Cost of revenues increased in Q3 and the first nine months of 2023 compared to 2022, driven by rate increases under existing and newly renegotiated network affiliation agreements[78](index=78&type=chunk) - Non-operating income increased by **$31.7 million** in Q3 2023, primarily due to a **$25.8 million** gain on the sale of a portion of the MadHive investment[94](index=94&type=chunk) [Results from Operations - Non-GAAP Information](index=28&type=section&id=Results%20from%20Operations%20-%20Non-GAAP%20Information) Q3 2023 Adjusted EBITDA decreased **38%** to **$165.9 million**, reflecting lower revenues and higher programming costs Adjusted EBITDA Reconciliation (in thousands) | Metric | Q3 2023 (in thousands) | Q3 2022 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Net income attributable to TEGNA Inc. | $96,183 | $146,065 | (34%) | | Operating income | $134,657 | $232,258 | (42%) | | **Adjusted EBITDA (non-GAAP)** | **$165,921** | **$265,972** | **(38%)** | - Special items excluded from non-GAAP results in Q3 2023 include retention costs related to the terminated merger and a gain on the sale of an equity investment. In Q3 2022, special items included M&A-related costs[106](index=106&type=chunk) - Free cash flow for the two-year period ending September 30, 2023 was **$1.28 billion**, or **20.6%** of revenue, compared to **$1.42 billion**, or **22.6%** of revenue, for the period ending September 30, 2022[111](index=111&type=chunk) [Liquidity, Capital Resources and Cash Flows](index=33&type=section&id=Liquidity%2C%20Capital%20Resources%20and%20Cash%20Flows) TEGNA maintains strong liquidity with **$553.0 million** cash and **$1.49 billion** credit facility, increasing dividends and share repurchases - The company increased its quarterly dividend by **20%** from **9.5 cents** to **11.375 cents** per share in Q2 2023[113](index=113&type=chunk) - A **$300 million** Accelerated Share Repurchase (ASR) program was completed in Q3 2023, and an additional **$325 million** ASR is planned for Q4 2023[114](index=114&type=chunk)[115](index=115&type=chunk) - As of September 30, 2023, total debt was **$3.07 billion**, and the company was in compliance with all debt covenants, with a leverage ratio of **2.58x**[119](index=119&type=chunk)[120](index=120&type=chunk) [Goodwill](index=35&type=section&id=Goodwill) Goodwill headroom narrowed due to stock price decline, increasing future impairment risk despite current fair value exceeding carrying value - Despite the reporting unit's fair value exceeding its carrying value by over **20%** as of September 30, 2023, the decline in the company's stock price has narrowed the headroom, creating a risk of future goodwill impairment[125](index=125&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Market risk exposure remains largely unchanged, with future credit facility borrowings subject to variable SOFR rates - The company has no outstanding floating interest rate debt, but future borrowings under its **$1.49 billion** available credit facility are subject to variable rates based on SOFR[129](index=129&type=chunk) [Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 30, 2023, with no material changes - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures are effective as of September 30, 2023[130](index=130&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=36&type=section&id=Item%201.%20Legal%20Proceedings) The company faces ongoing antitrust litigation but expects no material liability, with all merger-related lawsuits dismissed - TEGNA is a defendant in ongoing putative class action lawsuits alleging antitrust violations in local television advertising sales, which the company believes are without merit and intends to defend vigorously[52](index=52&type=chunk)[53](index=53&type=chunk)[55](index=55&type=chunk) - All seven lawsuits filed by purported stockholders related to the terminated merger have been voluntarily dismissed as of November 7, 2023[56](index=56&type=chunk) [Risk Factors](index=36&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors, except for a new risk concerning share repurchase programs and potential stock price volatility - A new risk factor was added concerning the company's share repurchase programs, stating there is no assurance they will enhance long-term stockholder value and could increase stock price volatility[134](index=134&type=chunk)[136](index=136&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) TEGNA repurchased **4.84 million** shares in Q3 2023, including final settlement of a **$300 million** ASR program Issuer Purchases of Equity Securities (Q3 2023) | Period | Total Shares Purchased (thousands) | Average Price Paid per Share ($) | | :--- | :--- | :--- | | August 2023 | 3,091 | $16.42 | | September 2023 | 1,749 | $15.96 | | **Total Q3 2023** | **4,840** | N/A | - As of September 30, 2023, approximately **$272.1 million** remained available for repurchases under the share repurchase program authorized in December 2020[138](index=138&type=chunk)[141](index=141&type=chunk) [Other Information](index=37&type=section&id=Item%205.%20Other%20Information) CEO David T. Lougee established a Rule 10b5-1 trading plan to sell up to **425,000** shares for estate planning - CEO David T. Lougee established a Rule 10b5-1 trading plan to sell up to **425,000** shares for estate planning, representing his first potential sales since becoming CEO in 2017[144](index=144&type=chunk)

Financial Data and Key Metrics Changes - Total company revenue decreased by 11% year-over-year, primarily due to reduced political revenue from the mid-term election cycle last year [9][37] - Subscription revenue reached a record high for the third quarter, showing a slight year-over-year increase [9][31] - Adjusted EBITDA for the third quarter was $166 million, down 38% year-over-year, mainly due to the absence of high-margin political revenue and increased programming costs [48][45] - Free cash flow generated during the quarter was $60 million, supported by high-margin subscription revenues [48] Business Line Data and Key Metrics Changes - Advertising and marketing services (AMS) revenue finished down 3% year-over-year, but underlying advertising trends were flat when adjusted for a national account loss [11][39] - Automotive advertising, the largest category within AMS, grew by 20% year-over-year, marking the fifth consecutive quarter of growth [12][41] - Services category also showed strong performance with a 15% year-over-year increase [12] Market Data and Key Metrics Changes - The company expects a favorable portfolio of stations for political advertising in 2024, benefiting from the presidential election cycle and the Summer Olympics [13][44] - Local OTT revenue for Premion was strong, up double-digits year-to-date, despite a year-over-year decline in total Premion revenue due to a national account loss [43][82] Company Strategy and Development Direction - The company is focused on enhancing performance, optimizing operational efficiency, and driving long-term shareholder value [7] - TEGNA reached a multiyear deal with ABC, renewing affiliations in 13 markets, which covers 9% of the US population [19][20] - The company is pursuing organic growth and evaluating opportunistic bolt-on M&A to augment its growth outlook [14][35] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2024, citing strong operating performance and favorable market conditions [44][18] - The company anticipates continued improvement in advertising revenue trends into the fourth quarter [11][61] - Management acknowledged macroeconomic challenges but highlighted the resilience of their business model [41][36] Other Important Information - The company completed an initial $300 million accelerated share repurchase program, reducing outstanding shares by approximately 18 million [32][26] - A second ASR program targeting $325 million is expected to commence shortly [16][70] - The board declared a 20% increase in the regular quarterly dividend, which was paid out for the first time in October [34] Q&A Session Summary Question: How are advertising trends expected to evolve in Q4? - Management indicated that sequential trends are improving and that underlying advertising trends would be better in Q4, despite the impact of a national account loss [61][60] Question: What is the company's approach to share repurchases during the upcoming ASR? - Management stated that they will use the ASR program opportunistically and will evaluate share repurchase opportunities based on market conditions [70][68] Question: How does the company view the impact of streaming on its business? - Management believes that sports broadcasting will remain a significant driver, and they are focused on maximizing value from their partnerships with networks [76][75] Question: What is the outlook for Premion's performance? - Management noted that while total Premion revenues are down, local revenue is strong and growing, indicating a focus on local advertisers [82][81] Question: How does the company plan to manage expenses moving forward? - Management acknowledged some temporary increases in expenses related to strategic planning and employee development but expects overall expenses to decrease in the fourth quarter [47][66]

Financial Highlights and Capital Allocation - TEGNA has $1.5 billion undrawn capacity on its revolving credit facility[5] - The company is committed to nearly $800 million in share reductions this year[6] - TEGNA expects to retire approximately 45 to 50 million shares by the end of March 2024, representing over 20% of shares outstanding prior to these actions[6] - TEGNA's debt is 100% fixed-rate with an effective rate of 5.2%[7] Revenue and Performance - TEGNA achieved record third-quarter subscription revenue in 2023[20, 68] - Total video plays across TEGNA's O&Os and YouTube averaged 400 million monthly in Q3 2023, a +69% year-over-year increase[32] - Total revenue was down 11% year-over-year in Q3 2023, primarily due to the absence of political revenue from the mid-term election cycle[41] - Subscription revenue in Q3 2023 was $378 million[42] Strategic Positioning and Growth - TEGNA is the largest independent owner of Big 4 affiliates in the top 25 markets[26, 52] - TEGNA's revenues are diversified, with subscription and political revenue comprising more than 50% of total company revenue on a two-year basis[27] - True Crime Network and Quest are reaching 88% and 83% of U S TV households, respectively[32, 58]

TEGNA Inc. (NYSE:TGNA) Q2 2023 Earnings Conference Call August 3, 2023 10:00 AM ET Company Participants Julie Heskett - SVP of Finance and IR Dave Lougee - President and CEO Victoria Harker - CFO Conference Call Participants Dan Kurnos - The Benchmark Company Craig Huber - Huber Research James Goss - Barrington Research Steven Cahall - Wells Fargo Aaron Watts - Deutsche Bank Operator Thank you for standing by, and welcome to the Second Quarter TEGNA Earnings Conference Call. At this time, all participants a ...

TEGNA INC. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________ FORM 10-Q _______________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 1-6961 ___________________________ (Exact name of registrant as specified in its charter) ___________________________ ( ...

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 1-6961 ___________________________ TEGNA INC. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________ FORM 10-Q _______________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR (Exact name of registrant as specified in its charter) ___________________________ ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-6961 TEGNA INC. 8350 Broad Street, Suite 2000, Tysons, Virginia 22102-5151 (Address of principal executive offices) (Zip Code) (703) 873-660 ...