Tegna, in the midst of a proxy fight with investor Standard General, said it expects first-quarter net income to be $86 million, up 17%, but suspended its guidance for the rest of 2020 and 2021 because of uncertainty caused by the COVID-19 pandemic.
Revenue is expected to be $684 million, up 32%, reflecting the acquisition of 13 TV stations, as well as subscription revenue growth and political ad spending.
The company is scheduled to report earnings on May 7 and will hold a virtual annual meeting on April 30.
The pandemic is having an impact on advertising revenues throughout the TV industry. Advertising accounts for more than half of Tegna’s ad revenue.
“Tegna believes it is prudent at this time to suspend its full year 2020 guidance and 2021 preliminary outlook,” the company said. “We continue to carefully monitor business impacts and to be diligent in implementing cost saving measures to reduce expenses and reducing non-critical capital expenditures. Non-political advertising revenues are being impacted by the wide variety of control measures in place, including states of emergencies, mandatory quarantines, required business closures, ‘shelter-in-place’ orders and travel restrictions.”
For the first quarter, Tegna said it expects to achieve its previously issue guidance across all metrics.
“Tegna is managing through today’s unprecedented circumstances - and is well positioned to continue to deliver long-term value to Tegna shareholders,” said CEO Dave Lougee.”We are focused on protecting our employees, supporting our customers and serving our communities. Tegna is experiencing a significant increase in audiences on all of our platforms, highlighting the crucial role our stations play by delivering award-winning local journalism which builds trust and loyalty among viewers.”
Lougee said the company’s management and board has weathered previous recessions.
“Over the past several years, we have deliberately focused on growing subscription revenues and political advertising, which are less sensitive to macroeconomic factors, and continue to be 2 key drivers of revenue. We have also diversified our advertising business into digital with our Premion OTT platform and have expanded the number of industries that advertise with Tegna,” he said.
“The intermediate and longer-term drivers reflected in our first quarter results, including strong subscription and political revenue as well as the continuing benefit from recent additions to our strategically constructed portfolio, are poised to deliver significant value over time for Tegna shareholders despite near-term uncertainty,” Lougee said.
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