TEGNA(US:TGNA)2025-05-08 20:17PART I. FINANCIAL INFORMATION Financial Statements Q1 2025 financials show decreased revenue and a sharp drop in net income year-over-year Condensed Consolidated Balance Sheet Summary (In thousands) | Account | Mar. 31, 2025 | Dec. 31, 2024 | | :--- | :--- | :--- | | Total current assets | $1,366,906 | $1,360,412 | | Total assets | $7,301,757 | $7,326,519 | | Total current liabilities | $973,518 | $466,280 | | Total liabilities | $4,242,179 | $4,301,488 | | Total equity | $3,038,870 | $3,004,714 | Consolidated Statement of Income Summary (In thousands, except per share) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenues | $680,049 | $714,252 | | Operating income | $109,023 | $137,560 | | Net income attributable to TEGNA Inc. | $58,671 | $189,560 | | Diluted EPS | $0.36 | $1.06 | Condensed Consolidated Statement of Cash Flows Summary (In thousands) | Activity | Three months ended Mar. 31, 2025 | Three months ended Mar. 31, 2024 | | :--- | :--- | :--- | | Net cash flow from operating activities | $59,629 | $100,380 | | Net cash flow (used for) provided by investing activities | $(6,368) | $86,224 | | Net cash flow used for financing activities | $(29,828) | $(116,876) | | Increase in cash and cash equivalents | $23,433 | $69,728 | Notes to Condensed Consolidated Financial Statements Notes detail the single operating segment, revenue nomenclature change, debt compliance, and ongoing litigation - TEGNA operates as a single reportable segment, consisting of 64 television stations and two radio stations21 - Beginning in Q1 2025, 'Subscription' revenue was renamed 'Distribution' revenue to better reflect content distribution fees3262 - As of March 31, 2025, total debt principal was $3.09 billion, and the company was in compliance with all debt covenants39 - The company is a defendant in antitrust lawsuits regarding local TV advertising sales, which it intends to defend vigorously505254 - The Accelerated Share Repurchase (ASR) program was completed on February 22, 2024, with a final delivery of 4.0 million shares47 Management's Discussion and Analysis of Financial Condition and Results of Operations Q1 2025 revenue and income declined due to lower political advertising and the absence of a prior-year investment gain Consolidated Results from Operations Q1 2025 revenue fell 5% and net income dropped 69% year-over-year, driven by a large prior-year investment gain Q1 2025 vs Q1 2024 Performance (In thousands) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenues | $680,049 | $714,252 | (5%) | | Operating Income | $109,023 | $137,560 | (21%) | | Net Income Attributable to TEGNA Inc. | $58,671 | $189,560 | (69%) | | Diluted EPS | $0.36 | $1.06 | (66%) | - The significant increase in non-operating expense was primarily due to the absence in 2025 of a $152.9 million gain from the sale of an investment in Broadcast Music, Inc. (BMI) that occurred in Q1 202472 Revenues Analysis Revenue decline was driven by cyclical drops in Political and Advertising & Marketing Services revenue Revenue by Category (In thousands) | Category | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Distribution | $379,556 | $380,503 | (0%) | | Advertising & Marketing Services | $286,397 | $296,109 | (3%) | | Political | $3,616 | $27,828 | (87%) | | Other | $10,480 | $9,812 | 7% | | Total revenues | $680,049 | $714,252 | (5%) | - Excluding the impact of a prior-year service disruption, distribution revenue would have been down $14.0 million, or 3.6%, in Q1 2025 compared to Q1 202463 Non-GAAP Information Q1 2025 Adjusted EBITDA decreased 22% to $136.2 million, with an Adjusted EBITDA margin of 20% Adjusted EBITDA Reconciliation (In thousands) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net income attributable to TEGNA Inc. (GAAP) | $58,671 | $189,560 | (69%) | | Adjustments (Taxes, Interest, D&A, etc.) | $77,577 | $(15,373) | *** | | Adjusted EBITDA (Non-GAAP) | $136,248 | $174,187 | (22%) | - Non-GAAP net income attributable to TEGNA Inc. was $60.9 million ($0.37 per diluted share) in Q1 2025, compared to $80.1 million ($0.45 per diluted share) in Q1 20247481 Liquidity, Capital Resources and Cash Flows The company maintains strong liquidity with a 2.89x leverage ratio and plans to redeem $250 million in debt - The company's leverage ratio was 2.89x as of March 31, 2025, below the maximum permitted ratio of 4.50x90 - TEGNA expects to redeem at least $250 million of its debt maturing in March 2026 during Q4 202590 - As of March 31, 2025, $375.2 million remained available for repurchase under the share repurchase program expiring December 31, 202586105 - Cash flow from operating activities decreased by $40.8 million YoY, primarily due to a $44.8 million payment for clean energy tax credits92 Quantitative and Qualitative Disclosures about Market Risk Market risk exposure has not materially changed, with no current floating-rate debt obligations - There have been no material changes in market risk exposures since December 31, 202498 - The company had no floating interest obligations outstanding, but future borrowings are subject to variable rates99 Controls and Procedures Disclosure controls and procedures were deemed effective with no material changes to internal controls - The principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective as of March 31, 2025100 - No material changes in internal controls over financial reporting occurred during the first quarter of 2025101 PART II. OTHER INFORMATION Legal Proceedings The company is defending against antitrust lawsuits related to local TV advertising, which it deems without merit - Information regarding legal proceedings is detailed in Note 10 to the condensed consolidated financial statements102 - The company is a defendant in ongoing antitrust litigation but does not believe any material liability will be imposed495455 Risk Factors A new risk factor regarding the impact of government tariffs on advertising demand has been identified - A new risk factor has been identified: The imposition of U.S. government tariffs and retaliatory actions may negatively impact advertising demand104 Unregistered Sales of Equity Securities and Use of Proceeds No shares were repurchased in Q1 2025, with $375.2 million remaining under the current buyback authorization - No shares were repurchased during the three months ended March 31, 2025105 - As of March 31, 2025, $375.2 million of common shares may still be repurchased under the program that expires on December 31, 2025105 Exhibits This section lists all exhibits filed with the Form 10-Q, including certifications and agreements