Gannett's media properties run the gamut. The company is the top newspaper publisher in the US with about 80 daily papers boasting a total circulation of about 5 million. Its flagship USA TODAY, with a circulation of 1.7 million, is the nation's second-largest newspaper (behind the Wall Street Journal). But Gannett is now a diverse international company that owns several important websites and more than 45 television stations. Its operations include broadcast, digital, mobile, and traditional publishing properties. Gannett also owns about 440 non-daily publications, as well as more than 200 papers in the UK through Newsquest. In 2014 Gannett announced plans to break itself up into two companies, one for broadcasting and print and the other for print.
Gannett operates through three business segments: Publishing, Digital, and Broadcasting (television). The Publishing segment contributed about 57% of the company’s revenues in 2014, down from 70% in the past two years. The company’s Digital segment, 15% of revenue, includes CareerBuilder, Cars.com, PointRoll, ShopLocal, and Reviewed.com. Through its Broadcasting segment, 28% of revenue, the company owns and operates 46 television stations.
Gannett operates primarily in the US and the UK. Nearly 91% of the company's 2014 revenue came from domestic operations and about 9% came from foreign operations, mostly in the UK.
In fiscal 2014 Gannett reported about $6 billion in revenue, 16% more than 2013. The driving forces were acquisitions of Belo and London Broadcasting Company TV stations. They company also had more revenue from retransmission and political and Winter Olympics advertising. Digital revenue increased with digital advertising and marketing across all segments and strong growth at CareerBuilder and the Cars.com acquisition
Gannett‘s net income decreased 173% to more than $1billion in 2014 compared to the previous year on higher revenue. It was the first time the company's profit surpassed $1 billion since 2007.
The company’s cash flow from operating activities also increased in 2014. It rose 61% to $821 million from $511 million in 2013 on higher revenue, a gain on the Cars.com acquisition, and changes in working capital.
Like other newspaper publishers, Gannett relies on both advertising and circulation revenue for the bulk of its sales. USA TODAY, meanwhile, has concentrated less on its print version and focused more on its digital version and delivering content to mobile devices.
Many of the company's newsrooms have become digital media hubs that create and distribute content to both print and digital media products, resulting in smaller printed editions augmented by more stories appearing online.
The company's online job site, CareerBuilder.com, is the largest in North America with the highest traffic and revenue. CareerBuilder is rapidly expanding its international operations.
Gannett plans to spin off its Publishing business from its Digital and Broadcasting segments. The newspaper business will retain the name Gannett while the digital and broadcast company will form a new company with a new name. The transaction is intended to free up the television and digital media operations from the less profitable newspaper businesses. The split is expected to conclude in mid-2015.
Looking forward to its post-split existence, the company formed to develop content (with the Weinstein Company), generate consumer engagement (the Outnumber Hunger unit of General Mills), and develop data insights (with Latitude).
Mergers and Acquisitions
Gannett's 2014 acquisition of London Broadcasting won't do much in the UK, but it does expand its footprint in Texas. In the deal, the company picked up KCEN (NBC) in Waco-Temple-Bryan, KYTX (CBS) in Tyler-Longview, KIII (ABC) in Corpus Christi, KBMT (ABC) and its digital sub-channel KJAC (NBC) in Beaumont-Port Arthur, KXVA (FOX) in Abilene-Sweetwater; and KIDY (FOX) in San Angelo.
In 2014 the company spent $1.8 billion to buy out the 73% of the auto sales website Cars.com that it did not already own. Cars.com became another important asset to Gannett's Digital segment's portfolio.
In late 2013 Gannett closed its $2.2 billion purchase of Belo. The deal nearly doubled its portfolio of TV stations from 23 to 43. The company is now the largest independent station group of major network affiliates in the top 25 markets. The Belo acquisition made Gannett the largest owner of CBS affiliates in the US. It was already the largest owner of NBC affiliates in the US.