ATLANTA, March 04, 2025 (GLOBE NEWSWIRE) -- Gray Media has named Ellenann Yelverton as its General Counsel. Since the closing of the Gray/Raycom Media merger in 2019, Ellenann has overseen the company’s legal matters for its operating divisions as our Deputy General Counsel. Prior to the merger, she served as Raycom’s General Counsel and managed a host of legal matters for the company across a wide range of disciplines and through numerous acquisitions of television stations and related businesses. “Gray ...

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $1 billion, an increase of 21% from Q4 2023 [12] - Net income attributable to common stockholders was $156 million in Q4 2024, compared to a net loss of $22 million in Q4 2023 [13] - Adjusted EBITDA was $402 million in Q4 2024, an increase of 86% from Q4 2023, primarily due to political advertising revenue [13] - Total principal debt was reduced by $520 million during 2024, exceeding the $500 million goal [14] Business Line Data and Key Metrics Changes - Political advertising revenue in Q4 2024 was $250 million, which displaced a significant amount of core advertising revenue [22] - Core advertising revenue showed hesitancy in Q4 2024, particularly among automobile advertising customers due to economic uncertainty [24] Market Data and Key Metrics Changes - Core advertising revenue for Q1 2025 is expected to decline by 7% to 8% compared to Q1 2024, influenced by political and economic uncertainty [25] - The company anticipates improvement in core advertising revenue pacing in Q2 2025 [44] Company Strategy and Development Direction - The company is focusing on enhancing local content offerings and expanding its sports broadcasting capabilities, including a deal to air Atlanta Braves games [15][16] - There is optimism regarding potential deregulation that could benefit local broadcasters and improve competitive positioning against tech giants [19][20] - The company is exploring partnerships for further development at Assembly Studios without significant capital expenditure [18][64] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing improvements in local sports broadcasting and potential regulatory changes that could benefit the company [19][20] - The company is preparing for the next political cycle in 2026, expecting significant cash flow from political advertising [34] Other Important Information - The company declared a quarterly common dividend of $0.08 per share, which is a small cash outflow [36] - The company is experiencing a decline in traditional MVPD subscribers but sees signs of improvement in subscriber retention rates [38] Q&A Session Summary Question: Can core ads move to growth on a full-year basis? - Management is encouraged by second-quarter pacing and believes core ads can grow, particularly as challenges in certain categories show improvement [44] Question: What factors are influencing expenses in Q1? - Approximately 2/3 to 75% of cost efficiencies are expected to flow through in Q1, with efforts to keep expense growth below inflation [48][49] Question: What is the total cost for the Assembly Atlanta project? - The total cost for the project is roughly $500 million [74] Question: How does the company view M&A opportunities with potential deregulation? - The company is open to smart deals and swaps, particularly if deregulation occurs, which could enhance local news content [86][120] Question: How is the company budgeting subscriber declines for this year? - The company expects the rate of subscriber declines to slow but is not projecting a material increase or decrease [91] Question: What are the expectations for network-affiliate relationships with deregulation? - The company is focused on relaxing market rules and improving network-affiliate relationships, particularly with virtual MVPDs [126]

Revenue and Income - Total revenue for 2024 increased by $363 million, or 11%, to $3.6 billion compared to 2023[208] - Core advertising revenue decreased by $24 million, while political advertising revenue increased by $418 million in 2024[210] - The company generated $1.49 billion from core advertising, contributing 41% to total revenue in 2024[207] - Miscellaneous income increased significantly to $117 million in 2024, primarily due to a $110 million gain from the sale of an investment[216] - Net cash provided by operating activities increased by $103 million to $751 million in 2024 compared to $648 million in 2023, primarily due to a $451 million increase in net income[224] Expenses and Costs - Broadcasting expenses increased by $49 million, or 2%, to $2.3 billion for 2024 compared to 2023[209] - Interest expense increased by $45 million, or 10%, to $485 million for 2024, primarily due to higher average interest rates[217] - The effective income tax rate increased to 24% for 2024 from 7% for 2023[220] - The company experienced moderate inflation in operating expenses and increased interest rates during 2024, which may adversely affect future operating results[250] Debt and Financing - The company completed several refinancing activities, resulting in a $520 million reduction in outstanding debt compared to December 31, 2023[206] - The company repurchased and retired $373 million of outstanding debt, utilizing $327 million in cash[205] - As of December 31, 2024, the principal outstanding of the company's long-term debt was $5.7 billion, down from $6.2 billion in 2023[279] - The fair value of the company's long-term debt as of December 31, 2024, was $4.6 billion, compared to $5.6 billion in 2023[279] - The company entered into a three-year $300 million revolving accounts receivable securitization facility to provide additional liquidity for debt repayment[247] Cash Flow and Investments - Net cash used in investing activities decreased by $263 million to $28 million in 2024 from $291 million in 2023, mainly due to reduced cash used for property and equipment purchases[225] - Net cash used in financing activities increased by $212 million to $609 million in 2024 compared to $397 million in 2023, with $474 million used for principal payments on long-term debt[226] - As of December 31, 2024, cash on hand was $135 million, a significant increase from $21 million in 2023[223] - The company anticipates that future cash flows from operations and borrowing availability will be sufficient to fund capital expenditures and debt service obligations for the foreseeable future[227] Capital Expenditures and Future Projections - Capital expenditures are expected to range between $85 million to $90 million during 2025, including reimbursements of approximately $25 million from the Doraville Community Improvement District[244] - The company estimates approximately $450 million in debt interest payments over the next twelve months following December 31, 2024[227] Asset Valuation and Impairment - As of December 31, 2024, the recorded value of broadcast licenses was $5.3 billion and goodwill was $2.6 billion[264] - For the annual impairment test in 2024, the company concluded that all evaluated broadcast licenses were not impaired based on qualitative assessments[260] - The company recorded a non-cash charge of $43 million for impairment of goodwill and other intangible assets due to the bankruptcy of Diamond Sports Group, LLC in 2023[265] - The company performed qualitative assessments for 56 broadcast licenses and three reporting units in 2024, compared to 59 licenses and one reporting unit in 2023[257] - The company utilizes a discounted cash flow model supported by a market multiple approach for estimating the fair value of its reporting units[261] Pension and Contributions - The Gray Pension Plan had a discount rate of 5.48% as of December 31, 2024, up from 4.79% in 2023[238] - Matching contributions to the Gray 401(k) Plan were approximately $28 million in 2024, compared to $26 million in 2023[240] Economic Risks and Management - The company manages economic risks, including interest rate and liquidity risks, through debt funding management and interest rate swap agreements[274] - The company entered into interest rate caps with a combined fixed notional value of approximately $1.9 billion, effective through December 31, 2025[277] - The interest rate caps limit the annual interest on variable rate debt to a maximum one-month SOFR rate of 5 percent, plus the Applicable Margin[277] - A 100 basis point increase in market interest rates would have increased the company's interest expense and decreased income before income taxes by $6 million for the year ended December 31, 2024[277] - A 100 basis point decrease in market interest rates would have decreased interest expense and increased income before income taxes by $6 million for the year ended December 31, 2024[277] - The company pays fixed interest rates on its 2031, 2030, 2029, 2027, and 2026 Notes, reducing the risk of potential interest rate increases[278]

Core Points - The Memphis Grizzlies, Gray Media, and FanDuel Sports Network will simulcast five upcoming Grizzlies games in Tennessee's largest media markets [1][2] - This partnership aims to enhance fan access to the Memphis Grizzlies through free over-the-air broadcasts [4] - The Grizzlies are currently performing well, ranking second in the NBA's Western Conference and fourth overall [2] Broadcast Details - In Memphis, games will be broadcast on WMC-TV, Action News Five channel 5.1, and simulcast on WMC-TV Plus, channel 5.3 [1] - In Nashville, broadcasts will occur on WSMV-TV, channel 4.1, and simulcast on the Tennessee Valley Sports and Entertainment Network, channel 4.2 [2] - In Knoxville, broadcasts will be available on WBXX, Knoxville's CW, channel 20.1, and MyVLT, MyNetworkTV, channel 8.2 [2] Game Schedule - The five-game schedule includes matchups against the Utah Jazz, Miami Heat, Oklahoma City Thunder, Golden State Warriors, and Dallas Mavericks, with specific dates and times provided [6] Broadcast Team - The FanDuel Sports Network Grizzlies broadcast team will include Pete Pranica, Brevin Knight, and sideline reporter Rob Fisher, featuring pregame and postgame shows [3]

Core Points - The Memphis Grizzlies, Gray Media, and FanDuel Sports Network will simulcast five upcoming Grizzlies games in Tennessee's largest media markets [1][4] - The partnership aims to enhance fan engagement by providing free, over-the-air broadcast options for the games [2][4] - The Grizzlies are currently performing well, ranking second in the NBA's Western Conference and fourth overall [2] Broadcast Details - In Memphis, games will be aired on WMC-TV, Action News Five channel 5.1, and simulcast on WMC-TV Plus, channel 5.3 [2] - In Nashville, broadcasts will occur on WSMV-TV, channel 4.1, and simulcast on the Tennessee Valley Sports and Entertainment Network, channel 4.2 [2] - In Knoxville, games will be shown on WBXX, Knoxville's CW, channel 20.1, and MyVLT, MyNetworkTV, channel 8.2 [2] Game Schedule - March 12 at 7:00 p.m. CT: Grizzlies vs Utah Jazz [7] - March 15 at 7:00 p.m. CT: Grizzlies vs Miami Heat [7] - March 27 at 7:00 p.m. CT: Grizzlies at Oklahoma City Thunder [7] - April 1 at 7:00 p.m. CT: Grizzlies vs Golden State Warriors [7] - April 13 at 2:30 p.m. CT: Grizzlies vs Dallas Mavericks [7] Company Background - Gray Media, Inc. is the largest owner of top-rated local television stations in the U.S., reaching approximately 37% of U.S. television households [5] - The company operates in 113 television markets and includes a diverse portfolio of media properties [5]

Financial Performance - Total revenue for the fourth quarter of 2024 was $1.0 billion, an increase of 21% from the fourth quarter of 2023[8] - Total revenue for the three months ended December 31, 2024, was $1,045 million, representing a 21% increase compared to $864 million in the same period of 2023[20] - Net income attributable to common stockholders was $156 million in the fourth quarter of 2024, compared to a net loss of $22 million in the fourth quarter of 2023[8] - Net income for the year ended December 31, 2024, was $375 million, a significant recovery from a net loss of $76 million in 2023[20] - Adjusted EBITDA was $402 million in the fourth quarter of 2024, an increase of 86% from the fourth quarter of 2023[8] - Adjusted EBITDA for the year ended December 31, 2024, was $1,162 million, up 42% from $816 million in 2023[20] - Core advertising revenue decreased by 8% to $380 million in Q4 2024 from $415 million in Q4 2023[20] - Total broadcasting revenue for the year increased by 11% to $3,539 million from $3,195 million in 2023[20] Advertising Revenue - Political advertising revenue in the fourth quarter of 2024 was $250 million, an increase of 658% from the fourth quarter of 2023[8] - Political advertising revenue surged to $250 million, a 658% increase compared to $33 million in Q4 2023[20] Debt and Leverage - The company reduced the outstanding principal amount of its debt by $520 million during 2024[3] - Long-term debt decreased to $5,621 million as of December 31, 2024, from $6,160 million in 2023[23] - The company’s total outstanding principal debt as of December 31, 2024, was $5,690 million, with a leverage ratio of 5.49, below the maximum permitted incurrence of 7.00 to 1.00[40] - As of December 31, 2024, the First Lien Leverage Ratio was 2.97 to 1.00 and the overall Leverage Ratio was 5.49 to 1.00[8] - Gray Media's borrowing availability under its Revolving Credit Facility increased to $674 million from $494 million[26] - The company incurred $485 million in interest expense for the year ended December 31, 2024, up from $440 million in 2023[38] Operating Expenses and Cash Flow - Operating expenses for the year were $2,793 million, a decrease from $2,898 million in 2023[20] - Cash provided by operating activities for the year was $751 million, compared to $648 million in 2023[23] Future Expectations - Core advertising revenue is expected to decline approximately 7% to 8% in the first quarter of 2025 compared to the first quarter of 2024[12] - The company anticipates achieving or exceeding an annual run-rate of $60 million in cost containment measures during the current quarter[13] - The company has a current authorization to repurchase up to $250 million of additional debt in the open market[14] - The company expects to receive approximately $35 million from agreements related to third-party leases for space at Gray-owned tower sites[7] Other Financial Metrics - The impairment of investments for the three months ended December 31, 2024, was $25 million, compared to $21 million in the same period of 2023[37] - Gray Media's depreciation expense for the year ended December 31, 2024, was $144 million, slightly down from $145 million in 2023[38] - The company reported a loss on disposal of assets of $20 million for the year ended December 31, 2024, compared to a loss of $21 million in 2023[38] - Common stock dividends for the year ended December 31, 2024, were $32 million, an increase from $30 million in 2023[38] Conference Call - Gray Media plans to host a conference call on February 27, 2025, to discuss its fourth quarter operating results[27]

Financial Performance - Gray Media reported quarterly earnings of $1.59 per share, matching the Zacks Consensus Estimate, compared to a loss of $0.24 per share a year ago [1] - The company posted revenues of $1.05 billion for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 0.19%, and up from $864 million in the previous year [2] - Over the last four quarters, Gray Media has surpassed consensus revenue estimates two times [2] Stock Performance - Gray Media shares have increased approximately 22.9% since the beginning of the year, significantly outperforming the S&P 500's gain of 1.3% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating expectations for it to outperform the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.30 on revenues of $795 million, and -$0.28 on revenues of $3.23 billion for the current fiscal year [7] - The estimate revisions trend for Gray Media is favorable ahead of the earnings release, which may influence future stock movements [6][5] Industry Context - The Broadcast Radio and Television industry, to which Gray Media belongs, is currently ranked in the top 34% of over 250 Zacks industries, suggesting a positive outlook for the sector [8]

Core Insights - Gray Media, Inc. reported financial results for Q4 2024, with total revenue reaching $1.0 billion, a 21% increase from Q4 2023, and political advertising revenue soaring by 658% to $250 million [7][19] - The company achieved a net income of $156 million in Q4 2024, a significant turnaround from a net loss of $22 million in Q4 2023 [7][18] - For the full year 2024, Gray Media generated $497 million in political advertising revenue, the highest among peers, and reduced outstanding debt by $520 million [1][19] Financial Performance - Total operating expenses for Q4 2024 were $648 million, 2% below the low end of guidance [1] - Adjusted EBITDA for Q4 2024 was $402 million, an 86% increase from Q4 2023, primarily driven by political advertising revenue [7][18] - The company ended 2024 with a First Lien Leverage Ratio of 2.97 to 1.00 and a total Leverage Ratio of 5.49 to 1.00 [7][34] Strategic Developments - Gray Media enhanced local content offerings, optimized cost structure, and strengthened its balance sheet throughout 2024 [2] - In December 2024, the company entered agreements to receive approximately $35 million for leasing rights at its tower sites, retaining ownership and control of the sites [5] - Cost containment measures are expected to achieve or exceed an annual run-rate of $60 million during Q1 2025 [10] Future Guidance - For Q1 2025, core advertising revenue is anticipated to decline by approximately 7% to 8% compared to Q1 2024, influenced by the Super Bowl airing on different channels [9] - The company expects to see strong double-digit growth in digital advertising revenue and from local customers who have not previously purchased advertising [9] - Guidance for total revenue in Q1 2025 is projected to be between $764 million and $775 million [12]

Core Viewpoint - Gray Media (GTN) is anticipated to report a significant year-over-year increase in earnings and revenues for the quarter ended December 2024, with earnings per share (EPS) expected to be $1.59, reflecting a 762.5% increase, and revenues projected at $1.04 billion, a 20.7% rise from the previous year [1][3]. Earnings Expectations - The upcoming earnings report is scheduled for February 27, and the stock may experience upward movement if the reported figures exceed expectations, while a miss could lead to a decline [2]. - The consensus EPS estimate has been revised 11.77% higher in the last 30 days, indicating a positive reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate aligns with the Zacks Consensus Estimate, resulting in an Earnings ESP of 0%, which complicates the prediction of an earnings beat [10][11]. - Despite the Earnings ESP being neutral, the stock holds a Zacks Rank of 2, indicating a potential for positive performance [11]. Historical Performance - In the last reported quarter, Gray Media was expected to post earnings of $0.94 per share but delivered only $0.86, resulting in a surprise of -8.51% [12]. - Over the past four quarters, the company has only beaten consensus EPS estimates once [13]. Conclusion - While Gray Media does not currently appear to be a strong candidate for an earnings beat, investors should consider other influencing factors when making decisions regarding the stock ahead of the earnings release [16].

Core Viewpoint - The article emphasizes the importance of value investing and highlights Gray Media Inc. (GTN) as a potentially undervalued stock based on various financial metrics [2][4][6] Company Analysis - Gray Media Inc. (GTN) currently holds a Zacks Rank of 2 (Buy) and an A for Value, indicating strong potential for value investors [4] - The stock is trading at a P/E ratio of 28.08, which is lower than the industry average P/E of 30.07, suggesting it may be undervalued [4] - GTN's Forward P/E has fluctuated between a high of 54.90 and a low of -64.84 over the past year, with a median of 2.29, indicating volatility in earnings expectations [4] - The P/S ratio for GTN is 0.11, significantly lower than the industry average P/S of 0.3, reinforcing the notion of undervaluation [5] Investment Outlook - The combination of GTN's favorable Zacks Rank, strong value metrics, and positive earnings outlook positions it as a compelling investment opportunity for value investors [3][6]