Gannett Co. Inc. (GCI), the largest newspaper publisher in the U.S. , recently notified that it has completed its previously announced private placement offering of $500 million senior notes. The company plans to utilize the net proceeds to repay outstanding debt under its revolving credit facilities and term loan.
The publisher of 84 daily newspapers in the U.S., had earlier announced plans to sell $500 million senior notes in two parts – 8.750% senior notes of $250 million due 2014 (issue price of $98.465) and 9.375% senior notes of $250 million due 2017 (issue price of $98.582).
Gannett also recently stated that it expects third quarter earnings in the range of 39 cents to 42 cents a share. However, this marks a sharp decline from 76 cents delivered in the prior-year quarter. The Zacks Consensus Estimate for the quarter is 38 cents.
Gannett also declared that it expects third quarter revenue to be between $1,307 million and $1,320 million, well below the $1,637.3 million reported in the year-earlier quarter.
Although the decline in publishing advertising revenue narrowed in the third quarter compared to the previous two, no real strength was witnessed in the advertising environment. The newspaper industry has long been grappling with plummeting advertising revenue due to economic headwinds. Although murmurs about advertisers returning to the market are gaining ground, the positive effects are yet to be realized in the current financial results.
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