Trusted Voices
Delivering Results
A TEGNA
2020 ANNUAL REPORT
Key Financial Metrics
2020 Results
$2.9B
Total Revenue
28% growth
compared to 2019
33% growth
compared to 2018
$1.3B
Subscription Revenue
28% growth
compared to 2019
53% growth
compared to 2018
$446M
Political Revenue
$483M
GAAP Net Income
91% growth
compared to 2018
69% growth
compared to 2019
19% growth
compared to 2018
$1B
in Adjusted EBITDA*
45% growth
compared to 2019
31% growth
compared to 2018
* “Adjusted EBITDA,” a non-GAAP measure, is defined as net income attributable to the Company before (1) net loss attributable to redeemable
noncontrolling interest, (2) income taxes, (3) interest expense, (4) equity income in unconsolidated investments, net, (5) other non-operating items, net,
(6) workforce restructuring expense, (7) M&A due diligence costs, (8) acquisition-related costs, (9) advisory fees related to activism defense, (10) spectrum
repacking reimbursements and other, net, (11) depreciation and (12) amortization.
Superior 2- and 3-Year TSR1 Since Becoming
a Pure-Play Broadcasting Company
2-Year
(2019-2020)
3-Year
(2018-2020)
2.3%
5.5%
21.4%
33.5%
TEGNA
Peer Median
0
5
10
15
20
25
30
35
1 Total shareholder return includes impact of stock price performance and reinvested dividends. Peer set is E.W. Scripps, Gray TV, Meredith, Nexstar
and Sinclair.
Five Pillars of Value Creation Driving Strong Growth
Best-in-class
operator
Aggressive, yet
disciplined pursuit
of accretive M&A,
including adjacent
businesses and
technologies
Growth
through organic
innovation, such
as Premion
Maintain a strong
balance sheet
Commitment to
strong free cash
flow generation
and optimized
capital allocation
process
2021 Annual Guidance
Subscription Revenue Growth
Non-GAAP Corporate Expense
Depreciation
Amortization
Interest Expense
Capital Expenditures
Including Non-Recurring Capital Expenditures
Effective Tax Rate
Net Leverage Ratio
Free Cash Flow as a % of
est. combined 2020/21 Revenue
+Mid to High-Teens percent
$44 - $48 million
$62 - $66 million
$60 - $65 million
$187 - $192 million
$64 - $69 million
$20 - $22 million
24.0 – 25.0%
Mid 3x
20.5% - 21.5%
2020 Annual Report 1
Company Profile
TEGNA Inc. is an innovative media company that serves
the greater good of our communities. Across platforms,
TEGNA tells empowering stories, conducts impactful
investigations and delivers innovative marketing
solutions. With 64 television stations in 51 U.S.
markets, TEGNA is the largest owner of top four
network affiliates in the top 25 markets among
independent station groups, reaching approximately
39 percent of all television households nationwide.
TEGNA also owns leading multicast networks
True Crime Network and Quest. TEGNA Marketing
Solutions (TMS) offers innovative solutions to help
businesses reach consumers across television, digital
and over-the-top (OTT) platforms, including Premion,
TEGNA’s OTT advertising service. For more information,
visit www.TEGNA.com.
2020 Journalism Awards
Multiplatform Broadcaster
of the Year Award
Awarded by Broadcasting+Cable
for excellence across television,
digital and OTT platforms
2
2021 Alfred I. duPont-
Columbia University Awards
Alliance for Women in Media
Foundation Gracie Awards
5
Honoring outstanding programming by,
for and about women; TEGNA stations
received more Gracie Awards than any
other local news organization in the country
Honoring WFAA and KING 5 for
excellence in audio and video journalism
Broadcasting+Cable
Awards
TEGNA received the most awards
among local station broadcast
groups in 2020
National Edward R.
Murrow Awards
9
Stations received more National
Murrow Awards than any other
local television broadcast group
88
Regional Edward R.
Murrow Awards
Stations won more awards than any
other local broadcast television group
1
7
2 TEGNA
Letter to Shareholders
Dear Fellow Shareholders,
TEGNA’s purpose is to serve the greater good of our
communities through empowering stories, impactful
investigations and innovative marketing services. We have
never been more certain of the importance of our role than
we are today. In 2020, our country faced an unprecedented
global pandemic, witnessed acts of racial injustice and related
demonstrations, and participated in local and presidential
elections with record turnouts. Our journalists have provided
ongoing coverage during each of these events, with an
unwavering commitment to delivering factual, important updates
to our audiences in the markets we serve across the country.
We want to thank you for your investment in our company
during this unique time, and to update you on some of the
important focus areas of our Board and management team
this year:
RESPONSE TO COVID-19
AND ACTS OF RACIAL INJUSTICE
We made thoughtful decisions in support of our employees,
businesses and communities during the pandemic. Since the
onset of the pandemic, our COVID-19 Task Force has
prioritized the health and safety of our employees,
implementing new practices for employees in our buildings or
reporting from the field. Our news production and technology
teams worked to create innovative solutions to enable our
stations to continue to broadcast news programs as
employees transitioned to remote work. To help employees
manage stress and receive support for family care needs
while balancing time at work, we made additional mental
health and back-up care resources available to employees
and their families. Throughout the year, we also focused on
turning the confusion and anxiety caused by the pandemic
into confidence and clarity for our partners. Our advertising
sales teams reached out personally to help businesses make
informed decisions. The sales transformation improvements
we have actively implemented over the past several years,
including bringing national sales in-house and creating one,
holistic sales organization, which we call “One Team TEGNA,”
helped our colleagues accelerate growth and better serve
clients and agencies. Our stations continued to partner with
local nonprofit organizations to address community needs.
Through virtual telethons, benefit concerts, fundraising drives
and awareness campaigns, stations helped raise more than
$66 million for local relief efforts, supporting frontline
healthcare workers and helping to ensure families impacted
by COVID-19 did not go hungry. Through the TEGNA
Foundation’s Community Grants program, stations identified
pressing needs in their communities and made 260 grants
totaling $1.85 million.
We took further proactive steps to help address and combat
systemic racism in our country and implemented changes to
support Diversity, Equity and Inclusion efforts at our
company. We believe the death of George Floyd was a
seminal moment of clarity regarding systemic racism in our
country. At TEGNA’s station in Minneapolis and throughout the
country, our journalists covered the resulting demonstrations
and helped bring their communities together, creating greater
awareness of racial issues and facilitating honest discussions
about race and inequality to bring about needed change in
our communities. While we have been proud of our diverse
and inclusive culture, the events of 2020 made it clear that we
must do more to ensure that our company is truly representative
of the diverse communities we serve. In 2020, our Board
adopted specific areas of oversight for each Board committee
regarding the way that TEGNA approaches diversity across a
number of different dimensions. In June, we launched a
Diversity & Inclusion Working Group comprised of employees
2020 Annual Report 3
from across TEGNA to provide input to our efforts. In
September, Grady Tripp was appointed to the newly created
position of Chief Diversity Officer, a role in which he partners
with organizational leaders to head the development and
execution of our diversity strategy. As a signatory to the CEO
Action for Diversity and Inclusion pledge, the largest CEO-
driven business commitment to advance diversity and inclusion
in the workplace, we have committed to strengthening
diversity and inclusion initiatives at TEGNA. We have
developed and adopted Diversity, Equity and Inclusion goals
for 2025 that include increasing Black, Indigenous and People
of Color (BIPOC) representation in our content teams, content
leadership and management roles. We are proud of these
actions and the progress we have made so far, and our efforts
with respect to diversity and inclusion will continue to be an
area of heightened focus for our Board and management.
RECENT PERFORMANCE REFLECTS THE STRENGTH
AND RESILIENCE OF OUR UNDERLYING BUSINESS
AND OUR LONG-TERM STRATEGY
We exceeded full-year 2020 guidance provided prior to the
COVID-19 pandemic for all key financial metrics, despite the
challenging external market environment. This strong
performance is a reflection of the prudent business and
strategic decisions our Board and management have made
over the years. TEGNA achieved total revenues of $2.9 billion
in 2020, a 28 percent increase from 2019, driven by record
political revenue and continued growth of our subscription
business. Adjusted EBITDA surpassed $1.0 billion for the year,
a key milestone, resulting in an Adjusted EBITDA1 margin of
34.9 percent while continuing to invest in Premion, our OTT
advertising platform, which grew its revenues by more than
40 percent in 2020 relative to the prior year, finishing the year
with revenue of more than $145 million. We generated $741
million of free cash flow in 2020, driving free cash flow as a
percentage of revenue of 21.3 percent for the 2019-2020
period. This has allowed us to rapidly repay debt and continue
to evaluate the most appropriate use of capital to drive
shareholder value.
Our subscription and political revenues continue to provide
high margin, stable revenues, now comprising more than 50
percent of our total company revenues on a two-year basis
and expected to comprise a larger percentage thereafter.
Our multi-year distribution agreements with several cable and
satellite TV providers, including the agreements we recently
reached with AT&T for DirecTV and AT&T U-Verse, give us
clear line of sight into future cash flows. In 2020, we repriced
approximately 35 percent of our paid subscribers at leading
Big Four affiliate rates and we will reprice an additional 30
percent in 2021. Our leading Big Four rates have driven and
will continue to drive the growth in our subscription revenue,
which grew by 28 percent from 2019 to 2020 to $1.3 billion.
We continue to see the rate of subscriber declines improve
and stabilize. Last year was also a record political year for us,
with full-year political revenue of $446 million. The strength of
our stations across the country positioned us well to capture
spending from presidential and congressional candidates
early on, continuing through both Election Day and the
Georgia Senate runoffs early this year. These two stable and
predictable revenue streams will continue to provide us with
significant cash flows in the years to come.
DILIGENT CAPITAL ALLOCATION PHILOSOPHY
BALANCES GROWING THE BUSINESS AND
RETURNING VALUE TO SHAREHOLDERS
Throughout the year, our Board continued its oversight
of the diligent management of our expenses, balance
sheet and liquidity through thoughtful cost and capital
management and financing actions. In early 2020, we
targeted reducing our annual run-rate expenses by $50
million by the end of 2021. With the efficiencies we have
gained while operating through COVID-19, as well as
continued operating cost reductions driven by innovative
technologies and centralization, we now expect to realize
these savings several quarters earlier than anticipated. In
2020, we also executed nearly $1.6 billion in refinancings
to lower interest expense and extend maturities to increase
capital flexibility. As of year-end 2020, we reached a net
leverage amount of 3.95x and have no upcoming debt
maturities until 2024. Thanks to our strong financial position,
we were able to announce the renewal of our $300 million
share repurchase program in January, which we had
previously suspended alongside the announcement of our
acquisition of the Nexstar-Tribune divestiture stations to
prioritize debt repayment. Our capital allocation decisions will
continue to focus on balancing investments in organic and
inorganic growth opportunities, paying down debt, issuing
dividends, and repurchasing shares. Our Board will remain
open to all avenues that create shareholder value, and we will
continue to be thoughtful in evaluating the best use of capital
to create and return value to shareholders.
2021 GUIDANCE UNDERSCORES MANAGEMENT’S
EXPECTATIONS FOR CONTINUED STRONG
PERFORMANCE AND GROWTH IN THE NEW YEAR
Our full-year 2021 financial guidance metrics reflect the
momentum from 2020’s record results, continued growth in
our subscription business and operating efficiencies. This
includes our projection of year-over-year subscription revenue
growth of mid-to-high-teens percent, reflecting Big Four rates
for our portfolio of stations. We also project net subscription
profits to grow in the mid-to-high twenties percent in 2021.
Full-year Adjusted EBITDA and free cash flow will continue to
reflect year-over-year expense improvements resulting from
significant cost reduction initiatives that have been underway
for the past 24 months.
CONTINUING TO FIND WAYS TO REACH
AND INTERACT WITH OUR CUSTOMERS
Our news coverage and reporting initiatives continued to
serve as our customers’ go-to source for information and
1 A reconciliation of Adjusted EBITDA, a Non-GAAP financial measure, to GAAP net income may be found on page 33 in the Company’s Form 10-K, filed
March 1, 2021.
4 TEGNA
trusted, verifiable news. This past year, our VERIFY fact-
checking reporting initiative played a critical role in fighting
disinformation during the pandemic and increasing
accountability around the election, including through VERIFY’s
expansion on Snapchat. Consumer demand for VERIFY
content surged in 2020, with traffic to VERIFY content on
stations’ websites increasing 423 percent year-over-year
(source: Google Analytics). During the election, our award-
winning journalists also played a critical role in building trust
and countering disinformation during the voting process. Each
member of our journalism team took part in training to detect
misinformation campaigns, and our local stations created
Voter Access teams to educate the general public on the
election process including where and how to vote.
The continued expansion of our digital footprint allowed us
to reach more consumers. Our digital properties averaged
nearly 70 million unduplicated monthly visitors during the year
(source: Google Analytics and YouTube Analytics) and video
plays totaled 1.7 billion, representing a 49 percent increase in
visitors and 100 percent increase in video plays year-over-
year. We also found new ways to interact with our audiences
through mobile features like “Near Me,” which allows viewers
to share content and get breaking news updates in real time,
including neighborhood-level information.
We continued to capitalize on the growth of viewing on
streaming services and expanded our offerings for our
customers. Premion is poised to continue to benefit from
increased viewing on streaming services into 2021 and
beyond, helping us expand our revenue base and giving us
access to new markets. We are expecting Premion to achieve
similar percentage revenue growth in 2021 as it experienced
in 2020. In February 2020, we reached an agreement with
Gray Television through which Gray serves as a reseller of our
Premion services, which further expanded Premion’s reach to
non-TEGNA markets. In July 2020, we entered into a renewed
and expanded partnership with TV data and measurement
company Alphonso to include Premion, in addition to our
linear advertising platforms. The multi-year agreement will
continue to provide TEGNA with metrics to help our
advertising partners make more informed, data-driven
decisions. We also updated Roku streaming apps for all
stations and began the rollout of our station apps on Amazon
Fire TV. These enhancements have allowed us to reach a
wider audience than ever before, and to continue to deliver
high quality news and entertainment at a time when our
consumers need it the most. Streaming customers are now
able to access live local news, weather forecasts, TEGNA’s
daily news and entertainment program Daily Blast Live, and
True Crime Network, which features premium, curated and
original content for true crime fans.
ONGOING STRONG OVERSIGHT BY OUR
EXPERIENCED AND ENGAGED BOARD AND
COMMITMENT TO INCORPORATING
SHAREHOLDER FEEDBACK
Our skilled, diverse Board continued to provide strong
oversight of our long-term strategy. Our Board has continued
to be actively engaged with management in overseeing and
driving the business forward, including through ongoing
self-assessment to ensure the Board has the right practices
and composition in place to be effective stewards of value
creation. The strong diversity of our Board (42 percent female
and 17 percent racially and ethnically diverse Directors), and
our Directors combined financial, media, operational, strategic,
M&A, ESG and ancillary experience allows for rich conversations
in the Boardroom and thoughtful evaluation of risks and
opportunities for TEGNA through the lens of varied, informed
perspectives. These combined skills proved to be invaluable
in navigating the challenges that we faced in 2020, and in
positioning us to continue to execute on our five-pillar strategy.
We expanded our commitment to integrating our ESG
strategy throughout our business as a result of shareholder
feedback and our ongoing work to align our initiatives in
this space with TEGNA’s values. In 2020, our Board and
management continued to engage with our shareholders to
understand their key areas of focus and feedback. One of the
most prominent topics discussed was our focus on our
environmental, social and governance practices. This past
year, our Board enhanced this focus area inside the
Boardroom and spent significant time discussing the path
forward for amplifying initiatives and reporting of these
important matters. The Public Policy and Regulation
Committee, which oversees TEGNA’s social responsibility and
sustainability efforts, also specifically discussed a path forward
for enhanced disclosure and reporting, including the decision
to report metrics aligned with the Sustainability Accounting
Standards Board’s (SASB) guidelines that are relevant to our
industry group. We will also begin tracking greenhouse gas
emissions and set goals for 2025 to prudently manage our
environmental impact. The Board continued to oversee
investment in our people, including developing talent,
supporting employee well-being, and listening to our
employees as part of our annual companywide employee
survey. You will find more information on our ESG reporting
in our 2020 Social Responsibility Highlights, which can be
viewed at tegna.com/corporate-social-responsibility.
IN CLOSING
As we reflect on the past year, we could not be prouder of
our people and company. This past year has been the most
unique and challenging of our history. However, we have
emerged from the year in a position of strength by taking
deliberate and decisive action and by institutionalizing key
learnings of how we can continue to grow going forward.
We look forward to the opportunities ahead of us in 2021
and beyond, for our company, our team, and all of our
stakeholders. Thank you for your continued support.
Sincerely,
Howard D. Elias, Chairman of the Board
Dave Lougee, President and Chief Executive Officer
2020 Annual Report 5
Howard D. Elias
Dave Lougee
Gina L. Bianchini
Stuart J. Epstein
Lidia Fonseca
Karen H. Grimes
Scott K. McCune
Henry W. McGee
Susan Ness
Bruce P. Nolop
Neal Shapiro
Melinda C. Witmer
Board of Directors
TEGNA has an independent and diverse Board, with Directors
that possess the complementary skills necessary to guide the
Company to long-term success through the COVID-19 pandemic
and this period of rapid change in the media industry. 11 of
TEGNA’s 12 Board Directors are independent, with CEO Dave
Lougee the only TEGNA employee represented on the Board.
TEGNA separates the positions of chairman and CEO, has an
independent Board chairman, and all key committees are
comprised of independent Directors.
Since 2017, TEGNA has undergone a Board refreshment process
to ensure Directors’ expertise align with TEGNA’s strategic
evolution. During this period, we added four independent
Directors with deep expertise in media, technology, social/digital,
and capital markets and transactional experience.
TEGNA’s active and engaged Directors spend significant time
engaged in strategy discussions in order to identify all opportunities
to create value for our shareholders. Directors also play a role in
TEGNA’s extensive shareholder engagement program, which
actively seeks feedback from investors to gain a better perspective
on TEGNA’s management and performance in key areas.
Howard D. Elias: Chairman, TEGNA Inc.; President, Services and
Digital, Dell Technologies. Formerly: President and Chief
Operating Officer, EMC Global Enterprise Services. Age 63. (b,c)
Dave Lougee: President and Chief Executive Officer, TEGNA Inc.
Formerly: President, TEGNA Media and President of Broadcasting,
Gannett Co., Inc. Other directorships: Broadcast Music Inc. (BMI)
and the Broadcasters Foundation of America. Age 62. (b,*)
Gina L. Bianchini: Founder and Chief Executive Officer, Mighty
Networks. Formerly: Chief Executive Officer and Co-Founder, Ning,
Inc.; Co-Founder and President, Harmonic Networks. Age 48. (d)
Stuart J. Epstein: Chief Financial Officer, DAZN Group. Formerly:
Co-Managing Partner, Evolution Media; Executive Vice President
and Chief Financial Officer, NBC Universal, Inc. Age 58. (a)
Lidia Fonseca: Executive Vice President and Chief Digital and
Technology Officer, Pfizer Inc. Formerly: Senior Vice President and
Chief Information Officer, Quest Diagnostics; Senior Vice
President and Chief Information Officer, Laboratory Corporation of
America. Age 52. (a,c)
6 TEGNA
Karen H. Grimes: Retired Partner and Senior Managing Director,
Wellington Management. Formerly: Vice President and Director of
Research, Wilmington Trust Company. Other directorships: Toll
Brothers Inc. Age 64. (a)
Scott K. McCune: Founder, MS&E Ventures. Formerly: Vice
President, Global Media and Integrated Marketing, The Coca-Cola
Company. Other directorships: First Tee Atlanta and College
Football Hall of Fame. Age 64. (a,b,c)
Henry W. McGee: Senior Lecturer, Harvard Business School.
Formerly: President, HBO Home Entertainment. Other
directorships: AmerisourceBergen Corporation. Age 68. (b,d,e)
Susan Ness: Principal, Susan Ness Strategies; Distinguished
Fellow, Annenberg Public Policy Center (University of
Pennsylvania). Formerly: Commissioner, Federal Communications
Commission (FCC); American Security Bank Vice President and
Communications Industries Group Head. Other directorships: Vital
Voices Global Partnership. Age 72. (b,d,e)
Bruce P. Nolop: Former Executive Vice President and Chief
Financial Officer, E*TRADE Financial Corporation. Formerly:
Executive Vice President and Chief Financial Officer, Pitney Bowes
Inc. Other directorships: Marsh & McLennan Companies, Inc. and
On Deck Capital, Inc. Age 70. (a,b)
Neal Shapiro: President and Chief Executive Officer, WNET. Other
directorships and trusteeships: Public Broadcasting Service (PBS);
The Institute for Nonprofit News; Board of Trustees, Tufts
University. Age 63. (d,e)
Melinda C. Witmer: Founder, LookLeft Media. Formerly: Executive
Vice President and Chief Video and Content Officer, Time Warner
Cable (now Spectrum); Chief Operating Officer, Time Warner
Cable Networks; Executive Vice President and Chief Programming
Officer, Time Warner Cable. Age 59. (c,e)
(a) Member of Audit Committee
(b) Member of Executive Committee
(c) Member of Leadership Development and Compensation Committee
(d) Member of Nominating and Governance Committee
(e) Member of Public Policy and Regulation Committee
(*) Member of the TEGNA Leadership Team
Dave Lougee
Lynn Beall
Anne W. Bentley
W. Edmond Busby
Victoria D. Harker
Akin Harrison
Clifton A. McClelland III
Jeffery Newman
Kurt Rao
Grady Tripp
Company Officers
Dave Lougee
President and Chief Executive Officer
Formerly: President, TEGNA Media and President of Broadcasting,
Gannett Co., Inc. Other directorships: Broadcast Music Inc. (BMI)
and the Broadcasters Foundation of America.
Jeffery Newman
Senior Vice President and Chief Human Resources Officer
Formerly: Vice President of Total Rewards and Human Resources
Services, Gannett Co., Inc. and Head of Compensation and
Benefits, HSBC North American operations.
Kurt Rao
Senior Vice President and Chief Technology Officer
Formerly: Chief Information and Technology Officer, Time Inc. and
Corporate Chief Information Officer, Time Warner Inc.
Grady Tripp
Vice President and Chief Diversity Officer
Formerly: Senior Director, Human Resources & Talent Acquisition,
TEGNA, and Human Capital Performance and Change
Management Leader, Accenture.
Lynn Beall
Executive Vice President and COO of Media Operations
Formerly: Executive Vice President, Gannett Broadcasting,
Gannett Co, Inc. and Senior Vice President, Gannett Broadcasting,
Gannett Co., Inc. Other directorships: National Association
of Broadcasters, CBS Television Affiliates Association and
T. Howard Foundation.
Anne W. Bentley
Vice President and Chief Communications Officer
Formerly: Vice President of Corporate Communications, PBS
and Senior Vice President of Corporate Communications, AOL.
W. Edmond Busby
Senior Vice President, Strategy
Formerly: Independent Advisor and Partner, The Boston Consulting
Group Media Practice and Chief Commerce Officer, Softcard.
Victoria D. Harker
Executive Vice President and Chief Financial Officer
Formerly: CFO and President of Global Business Services, AES
Corporation, Acting CFO and Treasurer, MCI and CFO, MCI Group.
Other directorships: Huntington Ingalls Industries, Stride and
Xylem Inc.
Akin Harrison
Senior Vice President, General Counsel and Secretary
Formerly: Associate General Counsel, Gannett Co., Inc. and
Corporate Attorney, private practice.
Clifton A. McClelland III
Senior Vice President and Controller
Formerly: Assistant Controller, Gannett Co., Inc., Vice President
of Compliance, Lafarge North America and Managing Director of
Corporate Accounting, US Airways Group.
2020 Annual Report 7
Serving the Greater Good
TEGNA strives to make a positive impact on the
communities in which we live and work. Our purpose
to serve the greater good of our communities is our
guiding light, and our values of inclusion, integrity,
innovation, impact and results drive our stations and
employees to be a force for positive change. In 2020,
our commitment to sustainability remained unwavering
as we rose to meet the challenges of a global
pandemic while taking action to ensure greater
diversity within our Company. Our environmental,
social, human and governance practices help to
strengthen our business while protecting
and enhancing TEGNA’s long-term value to our
communities, our employees, and shareholders.
APPROVED
3,000
employee matching gifts
totaling more than
$66M
raised through station drives to support
local community COVID-19 relief
to
$1.9M
1,000+
NON-PROFITS
$100,000
special grant to the NAACP Legal
Defense and Educational Fund
P O I N T S OF LIGH
T
12
Media Grants supporting
press freedom, journalism
ethics and training for the
next generation of
diverse journalists
260
TEGNA Foundation
Community Grants totaling
$1.85M
Additional information regarding TEGNA’s ESG initiatives, including TEGNA’s Media &
Entertainment Sustainability Accounting Standards Board (SASB) disclosure, can be found in our
2020 Social Responsibility Highlights Report and at tegna.com/corporate-social-responsibility.
8 TEGNA
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K
(Mark One)
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2020
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-6961
TEGNA INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
16-0442930
(I.R.S. Employer identification No.)
8350 Broad Street, Suite 2000, Tysons, Virginia
(Address of principal executive offices)
22102-5151
(Zip Code)
(Registrant’s telephone number, including area code)
(703) 873-6600
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Common Stock, par value $1.00 per share
Trading Symbol
TGNA
Name of each exchange on which registered
The New York Stock Exchange
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Securities registered pursuant to Section 12(g) of the Act: None
Yes ☒ No ¨
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes ¨ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes ☒ No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit such files). Yes ☒ No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller
reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting
company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
Large Accelerated Filer
☒
Accelerated filer
¨
Non-accelerated filer
¨
Smaller reporting company
Emerging growth company
☐
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the
effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the
registered public accounting firm that prepared or issued its audit report.
Yes ☒ No ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
The aggregate market value of the voting common equity held by non-affiliates of the registrant based on the closing sales price of
the registrant’s Common Stock as reported on The New York Stock Exchange on June 30, 2020, was $2,425,933,543. The registrant
has no non-voting common equity. As of February 19, 2021, 219,656,092 shares of the registrant’s Common Stock were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of our 2021 definitive proxy statement are incorporated by reference into Part III of this Form 10-K. The 2021 definitive proxy
statement will be filed with the U.S. Securities and Exchange Commission within 120 days of our fiscal year ended December 31, 2020.
INDEX TO TEGNA INC.
2020 FORM 10-K
Item No.
Page
Part I
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Mine Safety Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part II
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Management’s Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . . . . . .
Quantitative and Qualitative Disclosures about Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure . . . . . . . . . . . . . . .
Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part III
Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters . . . . . .
Certain Relationships and Related Transactions, and Director Independence . . . . . . . . . . . . . . . . . . . . . . . . . .
Principal Accountant Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Exhibits and Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Form 10-K Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part IV
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2
PART I
ITEM 1. BUSINESS
Our Business Overview
We are an innovative media company serving the greater good of our communities. Across platforms, we tell empowering
stories, conduct impactful investigations and deliver innovative marketing services. With 64 television stations and two radio
stations in 51 U.S. markets, we are the largest owner of top four network affiliates in the top 25 markets among independent
station groups, reaching approximately 39% of U.S. television households. We also own leading multicast networks True Crime
Network and Quest. Each television station also has a robust digital presence across online, mobile and social platforms,
reaching consumers on all devices and platforms they use to consume news content. We have been consistently honored with
the industry’s top awards, including Edward R. Murrow, Alfred I. DuPont-Columbia and Emmy Awards. Through TEGNA
Marketing Solutions (TMS), our integrated sales and back-end fulfillment operations, we deliver results for advertisers across
television, digital and over-the-top (OTT) platforms, including Premion, our OTT advertising network.
Over the past several years, we have transformed our company to become a pure-play broadcasting company, adding more
than 40 stations in attractive markets and divesting non-core assets. In 2019, we completed four strategic acquisitions for a total
purchase price of approximately $1.5 billion which enhanced our geographic diversity and bolstered our portfolio of Big Four
stations while positioning our company to take full advantage of emerging viewing trends. We now operate one of the largest
U.S. broadcasting groups, and are a leading local news and media content provider in the markets we serve. As a result of this
strategic evolution, we have increased revenue and cash flow, reduced economic cyclicality, and continue to be well-positioned
to benefit from additional industry consolidation.
COVID-19 Pandemic
During fiscal year 2020 and continuing into 2021, the world has been, and continues to be, impacted by the novel coronavirus
(COVID-19) pandemic. The COVID-19 pandemic has brought unprecedented challenges and widespread economic and social
change throughout the United States. At the same time, this past year demonstrated the strength and resiliency of our business
and core strategy, and illustrated the meaningful role we play in keeping our local communities safe and informed. This year
more than ever TEGNA stations’ local news broadcasts have been a trusted and critical source of information for our
communities. TEGNA stations reported essential information about the pandemic and its local impact, using experts to explain
medical and scientific data to our audiences, in addition to providing the latest information about how to stay safe including local
distribution plans for COVID-19 vaccines. TEGNA stations also were a trusted resource in helping viewers deal with the impacts
of the pandemic, providing information on relief efforts and how to apply for government programs.
In response to the pandemic, federal and state governments in the United States instituted a wide variety of mitigating control
measures, including mandatory quarantines, closures of non-essential businesses and all other places of social interaction, while
implementing “shelter in place” orders and travel restrictions in an effort to slow the spread of the virus. While some of these
measures have been lifted or relaxed in certain state and local governments, other jurisdictions have seen increases in new
COVID-19 cases resulting in restrictions being reinstated, or new restrictions imposed. These variations in COVID-19 mitigating
measures began negatively impacting our advertising and marketing services (AMS) revenue stream in mid-March 2020 as
demand for non-political advertising softened. However, overall advertising demand improved during the year for non-political
advertising as steps toward re-opening were implemented and as federal government stimulus programs were enacted. In late
2020, vaccines for combating COVID-19 were approved in the United States and began to be administered. However, initial
quantities of the vaccines are limited and vaccine distributions are controlled by local authorities.
The impact of COVID-19 and the extent of its adverse impact on our financial and operating results will be dictated by the
length of time that the pandemic continues to affect our advertising customers. This will depend on future pandemic related
developments, including the duration of the pandemic, any potential subsequent waves of COVID-19 virus, the effectiveness,
distribution and acceptance of COVID-19 vaccines, and related U.S. government actions to prevent and manage the virus
spread, all of which are uncertain and cannot be predicted.
Our Operating Structure
We have one operating and reportable segment which generated revenues of $2.9 billion in 2020. The primary sources of our
revenues are: 1) subscription revenues, reflecting fees paid by satellite, cable, OTT (companies that deliver video content to
consumers over the Internet) and telecommunications providers to carry our television signals on their systems; 2) advertising &
marketing services revenues, which include local and national non-political television advertising, digital marketing services
(including Premion), and advertising on stations’ websites and tablet and mobile products; 3) political advertising revenues, which
are driven by even-year election cycles at the local and national level (e.g. 2020, 2018) and particularly in the second half of
those years; and 4) other services, such as production of programming and advertising material.
The advertising revenues generated by a station’s local news programs make up a significant part of its total advertising
revenues. Advertising pricing is influenced by demand for advertising time. This demand is influenced by a variety of factors,
3
including the size and demographics of the local populations, the concentration of businesses, local economic conditions, and
the popularity or ratings of the station’s programming. Almost all national advertising is placed through our centralized internal
national sales force, while local advertising time is sold by each station’s own local sales force.
Our portfolio of “Big 4” NBC, CBS, ABC and FOX stations operate under long-term network affiliation agreements. Generally,
a network provides programs to its affiliated television stations and the network sells commercial advertising for certain of the
available advertising spots within the network programs, while our television stations sell the remaining available commercial
advertising spots. Our television stations also produce local programming such as news, sports, weather, and entertainment.
Broadcast affiliates and their network partners continue to have the broadest appeal in terms of household viewership,
viewing time and audience reach. The overall reach of events such as the Olympics and NFL Football, along with our extensive
local news and non-news programming, continues to surpass the reach in viewership of individual cable channels. Our ratings
and reach are driven by the quality of programs we and our network partners produce and by the strong local connections we
have to our communities, which gives us a unique position among the numerous program choices viewers have, regardless of
platform.
As illustrated in the table below, our business continues to evolve toward growing recurring and highly profitable revenue
streams, driven by the increasing concentration of both political and subscription revenue streams. As a result of the growing
importance of even-year political advertising on our results, management increasingly looks at revenue trends over two-year
periods. High margin-subscription and political revenues account for approximately half of our total two-year revenue, a trend
that began in 2019, and are expected to comprise an increasingly larger percentage on a rolling two-year cycle thereafter.
Combined Two Year Period
2019 - 2020
2018 - 2019
Advertising & Marketing Services
Subscription
Political
Other
Total revenues
46 %
44 % } 53%
9 %
1 %
100 %
52 %
41 % } 47%
6 %
1 %
100 %
Our Strategy
Our highly qualified Board of Directors is actively engaged and regularly reviews, guides and oversees the development and
implementation of our long-term strategic plan. Our Board of Directors and management team are committed to executing on the
following five-pillar strategy designed to create shareholder value.
1.
2.
3.
Continue to be a best-in-class operator;
Aggressive yet disciplined pursuit of accretive M&A opportunities, including adjacent businesses and
technologies;
Pursuing growth opportunities through organic innovation, such as Premion, our best in class OTT advertising
service;
4. Maintaining a strong balance sheet; and
5.
Commitment to strong free cash flow generation and optimized capital allocation process.
1. Continue to be a best-in-class operator:
Grow subscription revenue. Subscription revenue has steadily increased in the last several years, better reflecting the value
of the content that our business provides. Pursuant to Federal Communications Commission (FCC) rules, every three years a
local television station must elect to either (1) require cable and/or direct broadcast satellite operators to carry the station’s signal
or (2) require such cable and satellite operators to negotiate retransmission consent agreements to secure carriage. At present,
we have retransmission consent agreements with almost all cable operators, telecommunications and satellite providers in our
television stations’ markets for carriage of those stations. During the fourth quarter of 2020, we renewed our multi-year
distribution agreements with several major cable providers representing approximately 35% of our paid subscribers at leading
Big Four affiliate rates. These renewed agreements provide additional transparency and predictability into the expected future
growth of our subscription revenues.
Our scale and strength in local content have contributed to our ability to grow our subscription revenue beyond traditional
multichannel video programming distributors (MVPDs) into the growing OTT or streaming space. Migrating our content onto OTT
platforms allows us to reach an additional demographic of newer viewers that consume content online rather than via traditional
television platforms, enabling us to expand our subscription revenues and deliver advertising products to a broader viewing
audience.
4
We have OTT distribution deals with major network partners and streaming services such as Hulu, YouTube TV and AT&T
TV, permitting them to carry our stations’ content. Because our stations predominantly serve large markets that are pivotal to the
success of companies offering platforms in the OTT space, our distribution agreements with these partners and streaming
services contain financial terms similar to those in our more traditional distribution agreements with cable and satellite operators.
Affiliation agreements. We are the largest independent owner of NBC affiliated stations and second largest independent
owner of CBS affiliated stations (based on TV homes reached as reported by Nielsen, September 26, 2020). During 2020, we
successfully executed multi-year renewal of our affiliation agreement with NBC (extended to early 2024). In 2019, we executed
multi-year renewals with CBS (extended through 2022), ABC (extended through 2023), and Fox (extended through 2022).
2020 Political cycle. As a result of our 2019 acquisitions (discussed below), we have strategically expanded our portfolio to
include additional key political markets which enabled us to benefit from record political advertising in 2020. Our broadcasting
assets, paired with Premion, offer political campaigns the ability to reach voters across the country, not just in our TEGNA
television markets. Political advertising has proven to be a strong, dependable revenue stream that was less influenced by the
negative impacts that the COVID-19 pandemic had on our economy. We believe we are well-positioned for political revenues in
even years to come.
Improve the value we bring to advertisers. We provide our clients with data-driven integrated marketing services, using a
holistic approach that puts their advertising dollars to work in the channels that make the most sense for them, regardless of the
platform. We continue to expand market share in our marketing services business through our sales transformation efforts,
including innovations like our centralized 360-degree marketing services agency, and a well-trained, solutions-oriented
salesforce. We are also pursuing new technology initiatives that make television advertising easier to buy and are using data
analytics to provide insights on consumer traffic and purchasing decisions to advertisers.
Cost initiatives. We have implemented several significant cost-reduction initiatives and are in the process of implementing
additional such initiatives. These efforts include implementation of shared service support centers for all back-office support
functions, completion of company-wide financial systems consolidation in mid-2020, and automation of sales support processes
as well as other key traffic monitoring functions.
In order to mitigate the near-term impact on non-political advertising demand caused by the COVID-19 pandemic, we
implemented additional cost saving measures in the first and second quarters of 2020 to reduce operating expenses and capital
expenditures. These measures included implementing temporary one-week furloughs during the second quarter of 2020 for most
personnel, reducing compensation for executives and our board of directors, and reducing non-critical discretionary spending.
2. Aggressive yet disciplined pursuit of accretive M&A opportunities, including adjacent businesses and
technologies:
Our strong balance sheet and cash flow generation enables us to opportunistically grow the business through accretive
acquisitions. Since 2013, we have acquired more than 40 stations and transformed into a pure-play broadcast company with a
robust portfolio. In 2019, we identified and executed on significant M&A opportunities with clear and achievable synergies,
closing on four important acquisitions encompassing 15 television stations and two radio stations. We now own 64 television
stations in 51 markets with a concentration of Big Four stations in large, demographically growing markets, and an emphasis on
important political markets. In addition, in 2019, we completed the acquisition of multicast networks Justice Network (which has
since been rebranded as True Crime Network) and Quest from Cooper Media. True Crime Network and Quest are two leading
multicast networks that offer unique ad-supported programming. True Crime Network’s content is focused on true-crime genre,
while Quest features factual-entertainment programs such as science, history, and adventure-reality series.
While the COVID-19 pandemic and its economic effects curtailed M&A activity in 2020, we continue to identify and evaluate
all opportunities, including adjacent businesses and technologies, to add value for our shareholders via accretive acquisitions. In
early 2021, we announced the acquisition of Locked On Podcast Network, a leading and innovative podcast network for local
sports. Locked On produces daily shows for every team across the four major professional sports leagues, as well as more than
30 college sports programs. Locked On will expand TEGNA’s presence in the quickly growing podcast market, joining digital
content studio VAULT Studios (discussed further below) and stations’ podcasting efforts, and build on TEGNA’s overall sports
footprint. Locked On publishes more than 600 podcast episodes each week, generating eight million listens a month. Its
podcasts were downloaded more than 80 million times in 2020.
3. Pursuing growth opportunities through organic innovation such as Premion, our best in class OTT advertising
service:
Continue to innovate in our content offerings to our consumers. Our trusted, local content is the driver of our success across
all distribution channels and is a key ingredient that powers our current and future revenues. Our scale has allowed us to invest
in comprehensive content and digital innovation initiatives. Our focus on data-driven editorial processes, new storytelling formats,
and unique visual presentations across all our platforms are helping us to advance our goal of making our content the
consumers’ first choice, regardless of platform.
5
In 2020, we continued significant efforts to embrace change, transform our content and connect with audiences in unique and
powerful ways. Our culture encourages and embraces bold thinking and ideas from across the company. We are creating unique,
live and original content in news and non-news time periods to meet changing viewer habits. In an on-demand OTT world, live,
locally-relevant content is becoming increasingly important, and we are acting on that trend. We have continued to make
wholesale transformations of our local news operations. We have invested in true digital-first newsrooms, leveraging analytics to
better serve audiences and clients on-air and via mobile devices.
We are recognized for both our journalistic excellence and for our innovation in reinventing local journalism in the digital age.
In 2020, TEGNA was named Multiplatform Broadcaster of the Year by Broadcasting+Cable, a leading industry publication, for
excellence across television, digital and OTT platforms. TEGNA stations also received 88 Regional Edward R. Murrow Awards
for excellence in broadcast journalism, more than any other local broadcast television group. We had 29 TEGNA stations receive
Regional Murrow Awards, including eight for overall excellence, the highest honor awarded. Five TEGNA stations won for
excellence in innovation, which awards innovations that “enhance the quality of journalism and the audience’s understanding of
news.” In addition, TEGNA’s commitment to transform local news in the digital age resulted in 10 awards inspired by TEGNA’s
dedicated innovation process, while TEGNA also won 11 awards for excellence in multimedia or social media. Our WFAA station
in Dallas, Texas, was honored for “VERIFY Road Trip: Climate Truth,” which took a climate change skeptic on a journey through
Texas and Alaska to meet experts and witness first-hand the effects of global warming.
Our most innovative ideas frequently come from our employees who take active part in generating new ideas and pilots
through a recurring, structured process. This has resulted in the creation of new digital-first episodic investigations; multiplatform
news fact-checking segments like “VERIFY”; unique local news programs; and the launch in 2019 of an in-house digital
production and distribution studio, VAULT Studios. VAULT Studios leverages our stations’ robust archives of investigative stories
and has quickly gained a reputation as a premier podcast studio for fans of true crime. Several VAULT Studios productions have
been among the top 10 true crime podcasts on the Apple Podcasts app in 2020.
We produce the daily live, multi-platform syndicated news and entertainment program “Daily Blast LIVE” (or DBL) out of
KUSA in Denver. Now in its fourth year, “Daily Blast LIVE” is carried in all TEGNA markets and in select non-TEGNA markets,
together covering 48% of U.S. markets, up from 43% in the show’s third year. “Daily Blast LIVE” is a true multi-platform play,
broadcast across linear TV, digital and social media. The program is live 5 days a week, 50 weeks a year and streams 4.5 hours
of trending news each day on YouTube, Facebook, Twitter, Twitch DBL.com, the DBL app and TEGNA’s stations apps on Roku.
In July 2020, we announced the rebranding of Justice Network to True Crime Network and the launch of our first streaming
service, capitalizing on the rapidly growing over-the-air and OTT television viewing platforms. The True Crime Network streaming
app is available on Roku, Amazon Fire TV and Apple TV, via mobile and tablet on iOS and Android devices, Chromecast, and on
the web. True Crime Network offers a unique entertainment experience for true crime fans, integrating the 24/7 multicast network
with a free, on-demand streaming service and high-quality true crime podcasts from TEGNA’s VAULT Studios. True Crime
Network’s on-demand streaming service is dedicated exclusively to true crime content and programming. The service includes
free, ad-supported on-demand episodes across mobile and connected television apps. With hundreds of hours of on-demand
content from the network’s library, True Crime Network also features original programs developed from TEGNA stations’ vast
library of true crime and investigative content.
Increase engagement across all platforms. Through websites, mobile and OTT apps we extend our local brands reaching
almost 70 million unique visitors per month. As the consumption of content on digital platforms increases, we have continued to
make investments in developing new ways of connecting with local audiences and enhancing our digital capabilities. In 2020, this
included initiatives focused on expanding our digital footprint across TEGNA-owned and third-party digital and OTT platforms; the
continued development of new consumer products that enhance the viewer experience or generate revenue, and greater
integration of user-generated content to drive audience engagement and add a hyperlocal layer to our news coverage.
•
•
Expanded digital footprint: The COVID-19 pandemic generated increased demand for fact-checking to combat the
proliferation of misinformation. In response, stations’ VERIFY fact-checking reporting was expanded across all
platforms, and in August TEGNA launched VERIFY on Snapchat’s Discover platform, reaching a new and younger
audience among Snapchat’s approximately 90 million daily active users in North America. VERIFY episodes have
received a robust following since launching on Snapchat, with approximately 169,000 subscribers and 8.3 million unique
viewers (through February 2021). More than 50% of VERIFY’s audience on Snapchat is under the age of 25,
broadening our reach with younger news consumers.
Developing and enhancing consumer products: In 2020, we completed an update of our stations’ OTT streaming apps
on Roku, enhancing the experience for viewers. In December, we began rolling out OTT streaming apps for our stations
on Amazon Fire TV. With the rollout on Amazon Fire TV, TEGNA stations’ local news and other programming is
available to consumers on the two dominant OTT streaming media players, which comprise 70% of the U.S. market.
TEGNA’s OTT station apps offer streaming viewers free, ad-supported access to live news and the most recent news
broadcasts, breaking news and weather forecasts, in addition to VERIFY fact-checking reports and our live
entertainment program, Daily Blast LIVE.
6
•
User-generated content: During the pandemic, TEGNA scaled its user-generated content platform to allow viewers to
simultaneously text questions, photos and video directly to their local TEGNA station, allowing our news teams to
communicate with viewers, solicit feedback, keeping them better informed across all platforms and devices. TEGNA
also launched Near Me, a hyperlocal mobile app feature that allows audience members to share photos and videos and
see the latest news in their communities from both local stations and neighbors. This proved especially useful in
Minneapolis during the George Floyd protests, as users could see what was happening around them during the protests
and upload their own content. It has also been a central part of TEGNA station’s coverage of hurricanes, wildfires and
other major news events taking place in our markets. These innovations are helping us forge closer relationships with
our audience and better serve them with relevant information that’s happening in their neighborhoods TEGNA stations
now receive more than 100,000 text messages per month from viewers.
In late 2016, we launched Premion, the industry’s first local advertising network for over-the-top streaming and connected
TV platforms. Premion is a one-stop-shop for local, regional and national brands to place advertising in premium, brand safe
long-form programs across streaming devices, smart TVs and web browsers. With directly-sourced inventory from 125+ branded
networks, high quality inventory, advanced targeting and performance insights, Premion is a highly desirable and effective way
for advertisers to reach a highly-engaged streaming audience of so-called cord cutters, cord nevers and cord stackers in a
targeted manner, and has enabled us to expand our revenue base and to reach new markets. Our large, local salesforce is
leveraging relationships with local and regional advertisers to sell Premion inventory to deliver scale and measurable outcomes
at the local level. Premion continues to deliver strong revenue growth, up more than 40% in 2020 compared to 2019, with
revenue of more than $145 million in 2020. We expect Premion to have similar percentage growth in 2021.
On March 2, 2020, we sold a minority ownership interest in Premion for $14.0 million to an affiliate of Gray Television (Gray).
In connection with that transaction, Premion and Gray entered into a commercial arrangement under which Gray resells Premion
services across all of Gray’s 93 television markets. Our TEGNA stations and Gray each have the right to independently sell
Premion’s inventory in markets where we both operate a local television station. With this additional sales channel, our combined
TEGNA, Gray and Premion direct sales force reaches OTT viewers in more than 70% of the U.S. households.
Invest in new growth initiatives. We are further diversifying our revenue base by investing in new business models that
leverage our strong assets and scale.
•
•
•
•
Intelligent Ad Automation. Premion has been our first investment in intelligent ad automation. Premion has partnered
with MadHive (one of our strategic equity investments) to create a technology platform to aggregate inventory from OTT
providers and then resell the inventory to local and regional advertisers leveraging our salesforce.
In addition to Premion, we are a member of the Television Interfaces Practices consortium of broadcasters driving
standardization and interconnectivity of the automation of national spot advertising. Our centralized pricing resources
are enabling stations to more effectively price their advertising inventory to maximize share. New attribution
technologies are enabling our advertisers to better understand the impact their advertising has on consumer traffic and
purchasing. The creation in 2019 of a new, integrated in-house national salesforce has evolved the way we serve our
national customers and enables us to expand those relationships.
Dynamic Ad Insertion. During 2020, we made significant investments to build out our Dynamic Ad Insertion capabilities
in our top 25 TV markets. Dynamic Ad Insertion enables our stations to better monetize linear television content that is
distributed across various digital platforms, such as NewsOn, Roku, and other OTT applications. It provides us with data
driven targeted advertising that is incremental to the traditional linear advertising. We plan to continue to expand our
capabilities to the rest of our TEGNA markets in 2021.
Performance Marketing. We are a leading provider of digital marketing services for advertisers. In 2020, we continued
our investments in attribution across linear television and OTT, renewing and expanding our agreement with Alphonso
to enable local advertisers to better understand the value and effectiveness of their local TV and OTT ad campaigns.
The new multi-year partnership includes all of Premion and enables TEGNA’s local ad sellers to provide clients with
granular measurement and attribution for linear TV and OTT campaigns.
NextGen TV (ATSC 3.0). In 2017, the FCC began the process of issuing rules that would permit television stations to
broadcast in the new ATSC 3.0 broadcast transmissions standard, which will allow broadcasters to enhance their
existing transmission services with a new standardized system that will allow us to compete directly with Internet
protocols. This new standard will allow us to support higher 4K high dynamic range resolution, higher frame
rate, mobile, second screen experiences, 3D audio, virtual reality, advanced advertising and other exciting
enhancements to the viewing experience. The technology enables encryption and content protection that will allow
broadcasters for the first time to protect their signal and to employ paywalls on certain content streams, subject to the
requirement to continue broadcasting at least one stream of free over-the-air video programming. During 2018 and
2019, we worked with other broadcasters as part of the Pearl consortium’s ongoing pilot testing of the new standard in
Phoenix, Arizona. In 2020, several large TEGNA markets made the transition to NextGen TV, including Portland, OR,
Tampa, FL, Seattle, WA and Denver, CO, and we expect further markets to transition in 2021.
7
4. Maintaining a strong balance sheet:
Our balance sheet combined with our strong, accelerating and recurring cash flows provide us the ability to pursue the path
that offers the most attractive return on capital. We have a broad set of capital deployment opportunities, including retiring debt to
create additional future flexibility; investing in original, relevant and engaging content; investing in growth businesses like
Premion; and pursuing value accretive acquisition-related growth.
In 2020, the COVID-19 pandemic had far-reaching material adverse impacts on many aspects of our operations, directly and
indirectly, including our employees, consumer behavior, distribution of our content, our vendors, and the overall market. The full
impact of the COVID-19 pandemic, particularly with regard to the broader advertising industry, remains uncertain and is evolving.
We have taken a number of precautionary measures to mitigate the financial impact of the pandemic, and minimize the resultant
risks to our company, employees, our shareholders, customers, and the communities in which we serve. Such measures
included refinancing $538 million of debt with original maturities in either 2021 or 2024 which were extended out to 2026. In
addition, we amended our revolving credit facility on June 11, 2020 to extend the initial step-down of the maximum permitted total
leverage ratio by 15 months. Under the amendment our maximum leverage ratio covenant will remain at 5.50x until the fiscal
quarter ending March 31, 2022.
We will continue to review potential opportunities in a disciplined manner, both strategically and financially. In the near-term,
our priorities continue to be maintaining a strong balance sheet, enabling organic growth, acquiring attractively priced strategic
assets and returning capital to shareholders in the form of dividends and share repurchases.
5. Commitment to free cash flow generation and a balanced capital allocation process:
Our operations have historically generated strong cash flow which, along with availability under our existing $1.5 billion
revolving credit facility, have been sufficient to fund our capital expenditures, interest expense, dividends, investments in new
products and initiatives, as well as to fund acquisitions, including the 2019 acquisitions discussed above.
Our ability to generate strong operating cash flow from operations, including $805.1 million in 2020, has enabled us to
continue to de-lever following the 2019 acquisitions while continuing to pay a quarterly dividend of $0.07 per share. Our net
leverage ratio as of December 31, 2020 is 3.95x of Adjusted EBITDA (see definition of this non-GAAP financial metric in Item 7),
down from 4.92x as of the December 31, 2019 measurement.
In December 2020, our Board of Directors authorized the renewal of our share repurchase program for up to $300.0 million
of our common stock over the next three years. The program was previously suspended on March 20, 2019 simultaneously with
the announcement of our acquisition of the Nexstar-Tribune divestiture stations to prioritize use of cash flow for debt repayment
associated with those acquisitions. The renewal of the share repurchase program reflects the reduction of leverage ratio to pre-
acquisition levels, as well as demonstrates the Board’s and management’s confidence in the business and continued focus on
making prudent, disciplined decisions intended to drive near and long-term shareholder value. Our capital allocation decisions
focus on optimizing investments in organic and inorganic growth opportunities, paying down debt, issuing dividends, and
repurchasing shares.
In addition, we have effectively deployed capital through divestitures, which help fund our growth. Our Board and
management team continually assess the financial productivity of assets within our portfolio in the context of our strategy and
operations. As a result, we have realized proceeds of approximately $300 million from the sale of non-core assets since 2017.
These proceeds, together with cash distributions received from investments, have helped to provide a funding source for both
strategic acquisitions and investments in organic growth drivers such as Premion.
Our Competition
The proliferation of high-speed broadband to the home and phone has significantly increased competition in the video
marketplace in the last decade. Today, mobile broadband covers the U.S., and a vast majority of Americans own devices that can
access mobile broadband with numbers continuing to grow. Similarly, fixed, wired broadband to the home also covers a majority
of the United States and is also growing.
With the rise of 5G and unlimited data plans, every screen or mobile phone is now capable of displaying video programming
of the sort previously reserved to television. These video consumption patterns are no longer restricted to younger consumers.
With the onset of ubiquitous high-speed Internet service has come an explosion of platforms and applications with video
advertising capabilities that consumers have adopted. These include large players like YouTube and Facebook, and a long tail of
mobile applications and services that consumers value with more being added every week.
Our company strives to capture as large a viewing audience as possible for each of our broadcast stations, as the number of
viewers who watch our stations in each Designated Market Area (DMA) has a direct impact on our ability to maximize both of our
major revenue streams: advertising marketing services revenue and subscription revenue.
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As noted above, we compete for audience share as part of an increasingly varied and competitive media landscape. We
compete for advertising revenue with other platforms for television advertising media, including other broadcast stations and
cable providers. We also compete against both traditional and new forms of media that offer paid advertising, including radio,
newspapers, magazines, direct mail, online video, and social media. Major competitors in this space include cable providers
Comcast and Charter, as well as Internet platforms Google, Facebook, and YouTube. Advertisements on these digital platforms
look like traditional television ads and compete with over-the-air broadcast ads in the local ad market.
With respect to subscription revenue, we compete to capture a share of the total amount MVPDs are willing to pay for the
rights to distribute linear TV content to their subscribers. The larger our audience share, the more appealing our programming is
to the MVPDs and the more they will be willing to pay for the right to distribute it. We compete for this revenue against other
broadcast stations and cable networks.
The advertising industry is dynamic and rapidly evolving. Through their websites, our stations compete in the local electronic
media space, which includes the Internet or Internet-enabled devices, handheld wireless devices such as mobile phones and
tablets, social media platforms, digital spectrum opportunities and OTT video services. In this space, we compete for audience
and advertising revenue against other local media companies, Internet advertising giants such as Google and Facebook, as well
as the fragmented landscape of digital ad agencies. The technology that enables consumers to receive news and information
continues to evolve as does our digital strategy.
Our Regulatory Environment
Our television and radio stations are operated under the authority of the FCC, the Communications Act of 1934, as amended
(Communications Act), and the rules and policies of the FCC (FCC regulations). As a result, our stations are subject to a variety
of obligations, such as restrictions on the broadcast of material deemed “indecent” or “profane,” requirements to provide or pass
through closed captioning for most programming, rules requiring the public disclosure of certain information about our stations’
operations, and the obligation to offer programming responsive to the needs and interests of our stations’ communities. The FCC
may alter or add to these requirements, and any such changes may affect the performance of our business. Certain significant
elements of the FCC’s current regulatory framework for broadcast television are described in further detail below.
Licensing. Television and radio broadcast licenses generally are granted for eight-year periods. They are renewable upon
application to the FCC and usually are renewed except in rare cases in which a petition to deny, a complaint or an adverse
finding as to the licensee’s qualifications results in loss of the license. We believe that our stations operate in substantial
compliance with the Communications Act and FCC regulations.
Local Broadcast Ownership Restrictions. FCC regulations limit the concentration of broadcasting control and regulate
network and local programming practices. The FCC is required by statute to review these rules and regulations every four years.
In November 2017, the FCC adopted an order altering its regulations governing media ownership, generally making these
regulations less restrictive. For example, the order eliminated the newspaper/broadcast cross-ownership rule, which generally
prohibited an entity from holding an ownership interest in a daily print newspaper and a full-power broadcast station within the
same market, and the television/radio cross-ownership rule, which imposed a number of limits on the ability to own television and
radio stations in the same market. The order also made common ownership of two television stations in the same market
permissible in more markets so long as at least one of the commonly owned stations is not among the top four rated stations in
the market at the time of acquisition, and provided for case-by-case consideration of transactions that would result in new or
continued common ownership of two top four rated stations in a market. The FCC’s November 2017 ownership order also
eliminated a rule making certain television joint advertising sales agreements (JSAs) attributable in calculating compliance with
the ownership limits. TEGNA is not currently party to any JSAs.
Various parties, including cable operators and other advocates for more stringent broadcast ownership restrictions, opposed
the changes adopted in the FCC’s November 2017 order and challenged the order in court. The U.S. Court of Appeals for the
Third Circuit vacated and remanded the FCC’s November 2017 order effective as of November 29, 2019, thus reinstating as of
that date the FCC’s broadcast ownership rules in effect immediately prior to the November 2017 order. The U.S. Supreme Court
granted petitions by the FCC and broadcasters to review the Third Circuit’s decision. Oral arguments in the case were held on
January 19, 2021; the Supreme Court is expected to rule on the case by the end of June 2021.
The FCC requires the disclosure of shared services agreements (SSAs) in stations’ online public inspection files, though
these agreements generally are not deemed to be attributable ownership interests. The FCC defines SSAs broadly to include a
wide range of agreements between separately owned stations, including news sharing agreements and other agreements
involving “station-related services.” We are party to an SSA under which our television station in Toledo, WTOL, provides certain
services (not including advertising sales) to another Toledo television station owned by a third party. We are party to several
other agreements involving the limited sharing of certain equipment and resources; some of these agreements may qualify as
SSAs subject to disclosure.
National Broadcast Ownership Restrictions. The Communications Act includes a national ownership cap for broadcast
television stations that prohibits any one person or entity from having, in the aggregate, market reach of more than 39% of all
U.S. television households. FCC regulations permit stations to discount the market reach of stations that broadcast on UHF
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channels by 50% (the UHF discount). In December 2017, the FCC issued a Notice of Proposed Rulemaking seeking comments
on whether it can or should modify or eliminate the national ownership cap and/or the UHF discount. Our 64 television stations
reach approximately 32.2% of U.S. television households when the UHF discount is applied and approximately 39.3% without
the UHF discount.
Retransmission Consent. As permitted by the Communications Act and FCC rules, we require cable and satellite operators
to negotiate retransmission consent agreements to retransmit our television stations’ signals. Under the applicable statutory
provisions and FCC rules, such negotiations must be conducted in “good faith.” FCC rules also provide stations with certain
protections against cable and satellite operators importing duplicating network or syndicated programming broadcast by distant
stations. Pay-TV interests and other parties continue to advocate for the FCC to alter or eliminate various aspects of the rules
governing retransmission consent negotiations and stations’ exclusivity rights. In addition, some pay-TV operators recently have
invested in or otherwise coordinated with an online service called Locast, which asserts that it may lawfully retransmit broadcast
television signals over the Internet within the applicable stations’ Nielsen DMAs - without the originating stations’ consent - under
a federal Copyright Act provision that permits nonprofit organizations to retransmit broadcast television signals under certain
limited circumstances. A lawsuit filed on July 31, 2019 by the Big Four television networks, among others, alleges that Locast’s
service does not qualify for the claimed exemption and therefore constitutes copyright infringement. That lawsuit is pending in the
U.S. District Court for the Southern District of New York. If changes to the retransmission consent and/or exclusivity rules were
adopted, and/or if services such as Locast were determined to be lawful, such developments could give cable and satellite
operators leverage against broadcasters in retransmission consent negotiations, which could possibly adversely impact our
revenue from retransmission and advertising.
Post-Incentive Auction Repacking. In April 2017, the FCC announced the completion of a voluntary incentive auction to
reallocate certain spectrum then occupied by television broadcast stations to mobile wireless broadband services, along with a
related “repacking” of the television spectrum for remaining television stations. None of our stations relinquished any spectrum
rights as a result of the auction. Stations in eighteen of our markets (including one station we acquired post-repack in 2020) were
repacked to new channels. All of our repacked stations have completed their transitions to their new channels.
The legislation authorizing the incentive auction and repacking established a $1.75 billion fund for reimbursement of costs
incurred by stations required to change channels in the repacking. Subsequent legislation enacted on March 23, 2018,
appropriated an additional $1 billion for the repacking fund, of which up to $750 million may be made available to repacked full
power and Class A television stations and multichannel video programming distributors. Other funds are earmarked to assist
affected low power television stations, television translator stations, and FM radio stations, as well for consumer education
efforts. On October 7, 2020, the FCC announced that all final invoices and supporting documentation for reimbursement
requests will be due no later than (1) October 8, 2021, for full power and Class A TV stations that transitioned in Phase 5 or
earlier; (2) March 22, 2022, for full power and Class A TV stations that transitioned in Phase 6 or later; and (3) September 5,
2022, for all other entities entitled to seek repacking-related reimbursements (including low power television stations and
television translator stations). By law, the repacking reimbursement program will end July 3, 2023, at which point any remaining
unobligated funds will be returned to the U.S. Treasury.
A majority of our capital expenditures in connection with the repack occurred in 2018 and 2019. To date, we have incurred
approximately $42.0 million in capital expenditures for the spectrum repack project. We have received FCC reimbursements of
approximately $37.6 million through December 31, 2020. We expect to receive reimbursements for the remaining $4.4 million of
our spend upon completion of the FCC’s reimbursement review process.
NextGen TV (ATSC 3.0). In November 2017, the FCC adopted an order authorizing broadcast television stations to
voluntarily transition to a new technical standard, called Next Generation TV or ATSC 3.0. The new standard makes possible a
variety of benefits for both broadcasters and viewers, including better sound and picture quality, hyper-localized programming
including news and weather, enhanced emergency alerts, improved mobile reception, the use of targeted advertising, and more
efficient use of spectrum, potentially allowing for more multicast streams to be aired on the same 6 megahertz channel. However,
ATSC 3.0 is not backwards compatible with existing television equipment. To ensure continued service to all viewers, the FCC’s
order authorizing ATSC 3.0 operations requires full-power television stations that transition to the new standard to continue
broadcasting a signal in the existing DTV standard (known as ATSC 1.0) until the FCC phases out the requirement in a future
order. The content of this simulcast signal must be substantially similar to the programming aired on the ATSC 3.0 channel for a
period of at least five years. Transitioning a station to ATSC 3.0 is voluntary under current FCC rules and may require significant
expenditures. As of December 31, 2020, we are broadcasting the primary channels of KGW (Portland, OR), WTSP (Tampa, FL),
KUSA (Denver, CO), KING (Seattle, WA) and KONG (Everett, WA) in both ATSC 1.0 and ATSC 3.0 formats. In each case, in
accordance with FCC rules, we have entered into channel sharing agreements with other local broadcasters in the market to
facilitate this transition by hosting the applicable primary channel in either ATSC 1.0 or 3.0 format. We expect to continue rolling
out the new standard in coordination with other broadcasters, taking into account relevant market dynamics and our overall
capital planning. To the extent we roll ATSC 3.0 service out to our stations, there can be no guarantee that such service would
earn sufficient additional revenues to offset the related expenditures.
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Our Environmental Regulatory Matters
We are subject to various laws and government regulations concerning environmental matters and employee safety and
health. U.S. federal environmental legislation that pertains to us include the Toxic Substances Control Act, the Resource
Conservation and Recovery Act, the Clean Air Act, the Clean Water Act, the Safe Drinking Water Act and the Comprehensive
Environmental Response, Compensation and Liability Act (also known as Superfund). We are also regulated by the Occupational
Safety and Health Administration (OSHA) concerning employee safety and health matters. The Environmental Protection Agency
(EPA), OSHA and other federal agencies have the authority to write regulations that have an effect on our operations.
In addition to these federal regulations, various states have authority under the federal statutes mentioned above. Many state
and local governments have adopted environmental and employee safety and health laws and regulations, some of which are
similar to federal requirements. State and federal authorities may seek fines and penalties for violating these laws and
regulations. We believe that we have complied with such proceedings and orders at our stations without any materially adverse
effect on our Consolidated Balance Sheet, Consolidated Statements of Income or Consolidated Statement of Cash Flows.
Our General Company Information
Our company was founded by Frank E. Gannett and associates in 1906 and was incorporated in 1923. We listed shares
publicly for the first time in 1967 and reincorporated in Delaware in 1972. Our headquarters is located at 8350 Broad Street,
Suite 2000, Tysons, VA, 22102. Our telephone number is (703) 873-6600 and our website home page is www.tegna.com. We
make our website content available for information purposes only. It should not be relied upon for investment purposes, nor is it
incorporated by reference into this Annual Report on Form 10-K (Form 10-K).
Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements for our
annual stockholders’ meetings and amendments to those reports are available free of charge on our investor website, under
“Investor Relations” at www.tegna.com as soon as reasonably practical after we electronically file the material with, or furnish it
to, the Securities and Exchange Commission (SEC). In addition, copies of our annual reports will be made available, free of
charge, upon written request. The SEC also maintains a website at www.sec.gov that contains reports, proxy statements and
other information regarding SEC registrants, including TEGNA Inc.
Our Human Capital
Our people play an important role in our success in today’s rapidly evolving media landscape. Our key human capital
management objectives are to attract, retain and develop the highest caliber talent in our industry. Our human resources
programs are designed to support these objectives by offering competitive pay, industry-leading benefits and development and
growth opportunities. We strive to foster diversity, inclusion and innovation in our culture through our human resources, diversity
and journalism programs and policies.
In order to better inform our human resources strategies and help drive positive change from within, for the last two years
we’ve conducted annual comprehensive, anonymous companywide employee engagement surveys to better understand our
employees’ perspectives about working at TEGNA. Our 2020 employee survey covered a wide range of topics, including
compensation and benefits, career growth and development, opinions of company leadership, TEGNA’s performance on diversity
and inclusion, and our response to the COVID-19 pandemic. Feedback from these surveys provides our management team with
valuable information about our workplace culture. Results are reviewed with our Board and used to develop and refine aspects of
our overall human capital management strategy, including our diversity and inclusion initiatives and employee benefits plans.
Workforce Demographics - As of December 31, 2020, we employed approximately 6,430 full-time and part-time people
(including 118 corporate headquarters employees), all of whom were located in the United States. Our workforce is 47% female
and 25% people of color. In 2020, 54% of new hires were women and women earned 58% of promotions. In addition, 37% of
new hires were people of color and 31% of promotions were earned by people of color. In key news leadership positions, four of
eleven news director positions filled since the beginning of 2020 are diverse hires or promotions. Our Board of Directors is
comprised of 42% women and 17% people of color.
Gender Representation of U.S. Employees (%)
Management1
Professionals
All Other Employees
Male
58.4%
52.8%
50.8%
Female
41.6%
47.2%
49.2%
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Racial/Ethnic Group Representation of U.S. Employees (%)
Management1
Professionals
All Other Employees
Asian
2.5%
3.1%
1.6%
Black or
African
American
6.8%
12.5%
11.5%
Hispanic or
Latino
5.0%
9.8%
8.6%
White
81.6%
68.8%
73.8%
Other
1.5%
2.6%
2.0%
N/A2
2.6%
3.2%
2.5%
1 Defined as “Executive/Senior Level Officials and Managers” and “First/Mid-Level Officials and Managers” in our demographic representation data,
or EEO-1 information, which is submitted annually to the U.S. Equal Employment Opportunity Commission.
2 N/A = not available or not disclosed
Diversity, Equity and Inclusion – We have always been proud of our diverse and inclusive culture. We believe that diverse
voices and perspectives lead to great ideas and better collaboration and make us a stronger company. The events of 2020 have
made clear that we must do more to ensure that our company is truly representative of the diverse communities we serve. In
2020, we undertook several initiatives to drive meaningful and sustainable progress toward becoming a more inclusive and
racially diverse company.
•
•
Launched the TEGNA Diversity & Inclusion Working Group: In June, we announced the creation of a Diversity &
Inclusion Working Group consisting of 19 employees. The group developed a charter which includes three priorities:
increase TEGNA’s racial diversity in key leadership and influential positions across the company; ensure diverse
perspectives are respectfully valued, sought after, and embraced across our company; and identify and combat inherent
unconscious bias across our company through education, training programs, and enhanced policies and practices.
Appointed a Chief Diversity Officer: In September, we announced the appointment of Grady Tripp as the company’s
Chief Diversity Officer. This role was created to drive focus and intentional actions to ensure our long-standing inclusive
values resonate in all areas of our business. This newly created position reports to our president and CEO Dave
Lougee and is responsible for reviewing and enhancing policies and practices that drive our inclusion and diversity
values, developing companywide training programs to enhance awareness and accountability in diversity issues,
facilitating the company’s racial diversity and inclusion employee working group and providing thought leadership on
employee and organizational issues to help drive better outcomes. During 2020, we have:
◦
◦
◦
◦
◦
Conducted 33 local town hall meetings on race, diversity and inclusion with our stations and business groups
to hear directly from employees about their life experiences and perspectives, and about working at TEGNA;
Created additional local Diversity & Inclusion councils at stations where employees can share their ideas about
inclusion and diversity opportunities, and advise managers about cultural dynamics at stations and in the
community;
Developed a framework for diversity and inclusion issue resolution;
Conducted a thorough analysis of annual employee survey results by gender and ethnicity to support the
creation of action plans at stations; and
Began enhancing our content review practices and developing an 2021 Inclusive Journalism program for news
leaders and journalists to better recognize and combat implicit or unconscious bias and ensure our stations’
content represents the communities we serve.
• We have developed and adopted Diversity, Equity and Inclusion goals for 2025 that include increasing Black,
Indigenous and People of Color representation in our content teams, news leadership and management roles.
Investing in Our People – In 2020, we focused our efforts on ensuring we have a consistent and formal mechanism to identify,
track and develop our internal talent. This includes understanding our current capabilities, our future capabilities and what is
required to address our capability gaps. We maintain a robust annual performance management process across the
organization. Together with their managers, employees identify annual goals and, at the end of the year, provide their own self
assessments as to goal achievement and job performance. The results of each annual assessment are reviewed with employees
in one-on-one sessions with their managers.
We also have several programs to recognize and develop talent, including Leadership Development, Executive Leadership,
Producer-in-Residence and Mentoring programs. In 2020, we began accelerating planning to ensure sustainable recruitment,
retention and promotion of diverse talent, including strategies for investing further in equity in development opportunities and
increasing diversity in key leadership roles at our stations and throughout TEGNA. A core part of our executive officers’ people
goals include achievement of diversity initiatives and the development of diverse future leaders of our company.
In 2019, we hired a director of talent development and in 2020 merged the talent development and talent acquisition functions
together as part of a broader effort to build an integrated talent organization. These changes are designed to ensure our talent
strategy is aligned with our business strategy, and that our talent systems, programs, and processes are integrated more
effectively to deliver results. We have implemented a more robust approach for understanding and evaluating our current talent
capabilities that allows us to better identify, develop, and select high-potential talent for opportunities in a more consistent way.
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We have also implemented key performance indicators to help hold our leaders accountable for growing and developing our
talent to ensure we have the pipeline and capabilities to meet current and future business needs.
Our early-career producer program, Producer-in-Residence, is designed to help build a steady pipeline of outstanding
producer talent to increase, diversify, and engage our audience. We also offer formal leadership development programs for high-
potential talent to prepare them for success in future leadership and executive-level roles. In addition, we have launched a new
learning series to help accelerate the development of diverse, high-potential talent to ensure they are prepared for future roles as
news directors and digital directors. And on a regular basis, we provide functional-based development opportunities to continue
to address real-time development needs in areas such as news, marketing, digital and research.
Championing LGBTQ Equality - For the fourth consecutive year, TEGNA was named a Best Place to Work for LGBTQ
Equality by the Human Rights Campaign’s Corporate Equality Index. The 2020 Corporate Equality Index evaluated LGBTQ-
related policies and practices including non-discrimination workplace protections, domestic partner benefits, transgender-
inclusive health care benefits, competency programs, and public engagement with the LGBTQ community. We received the
highest marks in all categories, resulting in a perfect score of 100.
Employee Well-Being – Maintaining the health and well-being of our employees and their families is a top priority for our
company. Based on the feedback gained from our employee surveys, we continue to implement changes to company-offered
benefits to improve affordability and increase choice. In addition to comprehensive health and wellness coverage, we have
expanded our benefits offerings so employees have the care and coverage they need. The following additional benefits will be
available to employees in 2021:
•
•
•
•
•
Improved Fertility Coverage: We have added a new fertility benefit to support employees who are trying to expand their
families. Our provider, Progyny, provides access to the largest network of premier fertility specialists, as well as support
and guidance for adoption and surrogacy.
Expanded Parental Leave: We updated our parental leave policy so all new parents will receive at least six weeks paid
parental leave with mothers giving birth receiving a minimum of 12 weeks paid leave.
Applied Behavioral Analysis (ABA) Therapy: Often used as a therapy for individuals with Autism Spectrum Disorders,
ABA therapy is now covered under our medical plans.
HIV PrEP Rx: HIV pre-exposure prophylaxis (PrEP) prescription medications are covered in full.
Company Holidays: Juneteenth has been added as a paid company holiday. Additionally, the day after Thanksgiving
has been changed to a Floating Holiday that employees may use at their discretion to observe a cultural or other
holiday that is personally significant to them.
Employee Support During COVID-19 – We prioritized the health and safety of our employees during COVID-19 by moving
employees to remote work, implementing safety and other guidelines for news production employees and modifying television
station buildings and other office locations following the Centers for Disease Control and Prevention’s workplace guidelines.
Throughout the COVID-19 pandemic, we invested in or made available additional health, mental health and wellness resources
for employees and their families, including:
•
Care@Work: With a majority of employees working from home, we are covering the cost of membership to Care@Work
from Care.com to help manage family care needs while balancing time at work. We partnered with Care.com to give
employees premium, unlimited access to find local caregivers.
• Webinars on managing mental health, isolation, stress and anxiety during COVID-19 were developed and offered to
employees live and on-demand.
•
•
•
•
Developed and delivered sessions for managers on how to foster high-performing teams in a virtual environment.
Expanded medical and mental health resources through our healthcare provider, BlueCross BlueShield of Texas, with
telemedicine so employees can schedule video or phone consultations with their medical and mental health providers.
Teladoc’s telemedicine program is available to all employees and family members for sick visits and for behavioral
health care sessions. All employees are eligible for nine Teladoc virtual visits even if they are not enrolled in our medical
plans.
TEGNA’s Employee Assistance Program offers support to employees and their families through 24-hour, 7-days per
week confidential access to professional support to help manage stress, anxiety, grief, financial concerns, and much
more.
Compensation and Benefits Programs – Our compensation and benefits are structured to attract the most talented people
and incentivize performance based on the short and long-term strategic goals of our company. Our compensation packages
include competitive base salaries, which include options for medical, dental and vision insurance, company holidays and paid
time off, and parental leave. We encourage employees to invest for their future by offering a 401(k) plan that includes a company
match up to four percent of salary and is fully vested from the day employees begin participating.
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Labor Union Representation - Approximately 10% of our employees are represented by labor unions. They are represented
by 27 local bargaining units, most of which are affiliated with one of four international unions under collective bargaining
agreements. These agreements conform generally with the pattern of labor agreements in the broadcasting industry. We do not
engage in industry-wide or company-wide bargaining.
Information About our Executive Officers - Our executive officers as of March 1, 2021 are listed below, with their ages on that
date, positions and offices currently held, and principal occupation and business experience during at least the last five years. All
officers serve at the discretion of the Board of Directors.
David T. Lougee - President and Chief Executive Officer (June 2017-present); TEGNA director (2017-present). Formerly:
President, TEGNA Media (July 2007-June 2017). Age 62.
Lynn Beall (Trelstad) - Executive Vice President and COO of Media Operations (June 2017-present). Formerly: Executive
Vice President and Chief Operating Officer, TEGNA Media. Age 60.
Victoria D. Harker - Executive Vice President and Chief Financial Officer (June 2015-present). Age 56.
Akin S. Harrison - Senior Vice President, General Counsel and Secretary (January 2019 - present). Formerly: Senior Vice
President, Associate General Counsel and Secretary (June 2017 - December 2018), Vice President, Associate General
Counsel and Secretary (July 2015 - June 2017). Age 48.
Our Corporate Responsibility and Sustainability
Our purpose to serve the greater good of our communities is our guiding light, and our values of inclusion, integrity,
innovation, impact and results drive our stations and employees to be a force for positive change in the communities where we
live and work. In 2020, our commitment to sustainability remained unwavering as we rose to meet the challenges of a global
pandemic while taking action to ensure greater diversity and equity within our company. Our social, human, environmental and
governance practices help to strengthen our business while protecting and enhancing our long-term value to our communities,
our employees, and our shareholders. Our corporate social responsibility efforts are guided and overseen by our Board’s Public
Policy and Regulation Committee, which monitors, in coordination with the Board and other Board committees regarding matters
within their purview, TEGNA’s policies and programs relating to corporate social responsibility, sustainability, and Environmental,
Social and Governance related matters.
In 2020, we adopted the Sustainability Accounting Standards Board’s (SASB) industry standards for Media & Entertainment
companies. The SASB has established standards on sustainability matters that facilitate communication by companies to
investors on decision-useful information. Our report on the SASB’s Media & Entertainment standards is included in our most
recent Social Responsibility Highlights Report, which can be found at www.tegna.com/corporate-social-responsibility.
Environmental Commitment - We are committed to protecting and preserving our environment and minimizing our carbon
footprint by operating our business in a sustainable manner as a responsible corporate citizen. Before the pandemic, we
committed to reducing unnecessary business travel by utilizing video conferencing technology across the company and will
continue with that strategy. We continue to implement thoughtful energy efficiency strategies, including upgrading stations’ studio
lighting to LED; replacing non-efficient HVAC systems, and replacing roofs with energy efficient alternatives. To date, we have
updated main studio lighting to LED at 33 of our 64 stations.
Recognizing that climate change is an ongoing risk to U.S. commerce, we are taking steps to identify environmental goals
and timeframes for drawing down emissions and fortifying our operations to be resilient in the face of future climate impacts.
Specifically, in 2021, we will be conducting a Task Force on Climate-Related Financial Disclosures gap analysis in order to
develop goals and set action plans for Scope 1 and Scope 2 greenhouse gas emissions. As a part of this process, we will
incorporate science-based emissions reduction targets into our goal setting that align with international consensus on limiting
global temperature increases.
In order to operate in an environmentally friendly way, our environmental policies include practices for the recycling and
responsible disposal of technology products and equipment such as batteries, and reducing the waste we generate at corporate
offices and in production processes. We regard environmental responsiveness and resource conservation as an integral part of
business management, and support finding sound solutions to such environmental problems as may arise. Each facility is
expected to manage its activities in a manner that will achieve our environmental goals. Each employee is expected to work
toward these goals and is encouraged to advise their supervisor promptly of any situation that may be in conflict with our
environmental policy.
When we seek to upgrade office locations, our preference is toward LEED-certified buildings that are designed for energy
efficiency and water conservation, like our studio and office facilities at KING in Seattle, KHOU in Houston, Premion in New York
and our corporate headquarters in Tysons, Virginia. We recently invested in consolidating WBNS TV’s offices in Columbus, Ohio,
to include our WBNS Radio station, which was located in a separate building. Moving forward, we will build on the lessons
learned from the COVID-19 pandemic and continue to review our real estate portfolio to optimize and consolidate where possible
to drive efficiencies and further reduce our carbon footprint.
14
The TEGNA Foundation, the charitable foundation sponsored by TEGNA Inc., supports nonprofit activities in communities
where we do business and contributes to a variety of charitable causes through its Community Grant Program. Community
Grants are identified locally by our stations and include support for community sustainability efforts. In our commitment to serve
the greater good, our stations regularly report on environmental, climate and sustainability issues that impact our communities.
Social Impact - Exposing corruption and wrongdoing, holding elected officials and those in power accountable, giving a voice
to the voiceless and telling empowering stories that impact our lives is at the heart of our purpose to serve the greater good.
During a year when attacks on journalists, journalism and the First Amendment became all too common, our stations and news
teams continually strove to be the most trusted sources of news in our communities and to make an impact by being agents of
change in the markets we serve. Our local journalists are empowered to seek out the stories that matter most to their audience
and pursue investigations that expose wrongdoing while continuing to maintain the highest ethical standards. In 2020, TEGNA
won more major journalism awards than any other local broadcaster as a result of our innovative approach to content, impactful
investigations and commitment to the communities we serve.
In 2020, our stations helped raise more than $100 million in support of diverse local causes that address specific needs in
communities. Through the TEGNA Foundation, we work to improve lives in the communities we serve by contributing to a variety
of local charitable causes through Community Grants. Through its other programs, the TEGNA Foundation invests in the future of
the media industry through Media Grants, supports employee giving and volunteerism, and contributes to a variety of charitable
causes. The TEGNA Foundation’s local Community Grants program is the main vehicle for distributing charitable donations
within our communities. Each year, our stations identify pressing needs in their communities and partner with local nonprofit
organizations to help address these issues. In 2020, the TEGNA Foundation in partnership with local stations made 260
Community Grants totaling $1.85 million. Grants are distributed within the United Nations Sustainable Development Goal
framework, with the majority of 2020 grants supporting four major categories: Good Health and Well-Being, Quality Education,
Zero Hunger, and No Poverty. Our stations amplify the impact of charitable donations through on-air and digital awareness
campaigns to raise the profile of important issues and causes, and through employee volunteerism.
During the COVID-19 pandemic, our stations have continued to partner with local nonprofit organizations to address urgent
needs. Through virtual telethons, benefit concerts, fundraising drives and awareness campaigns, our stations have helped raise
more than $66 million for local relief efforts, from supporting frontline healthcare workers to helping ensure families impacted by
COVID-19 do not go hungry. In 2020, 36% of TEGNA Foundation Community Grants went directly to local community
organizations working toward COVID-19 relief efforts.
Our employees also give back to their local communities by volunteering for and donating to their favorite causes. In
response to the unprecedented impacts of COVID-19 and the social justice movement of 2020, in June, the TEGNA Foundation
doubled its employee matching gift program, offering employees a 2:1 match for their donations to the causes and nonprofits
most meaningful to them. In 2020, TEGNA Foundation approved more than 3,000 employee matching gifts, a new high for the
program. More than 1,000 unique charities were reached through our employees’ giving, and their donations combined with the
TEGNA Foundation’s matches totaled more than $1.9 million.
We support employee participation in charitable causes, providing 10 hours of paid time off annually for volunteer work in
addition to our employee matching gift program. Employees still found ways to be impactful in 2020 despite the limitations of
COVID-19, using their volunteer time off hours for virtual events such as online mentorship or socially distanced food delivery to
those in need. Our employees also take part in mentoring our nation’s veterans through our partnership with American Corporate
Partners, helping veterans transition out of the military and guiding them as they re-enter life in the private sector.
Our stations are also a valued resource for communities when natural disasters strike. In addition to our news coverage that
keeps our audience informed and safe during disasters, our stations tell inspirational stories of heroism and hope to help our
communities pull together during times of crisis. When wildfires began affecting Oregon and Washington residents, KGW
activated the Northwest Response Fund, in partnership with the Red Cross, to assist residents who have been displaced or
impacted. Within one week, KGW helped to raise more than $1.0 million.
In 2020, we were named to The Civic 50 by Points of Light, the world’s largest organization dedicated to volunteer service.
The Civic 50 recognizes TEGNA as one of the 50 most community-minded companies in the United States. In addition, we were
also selected by The Civic 50 as the Sector Leader in the Telecommunications industry.
Corporate Governance - Our management and Board of Directors aim to create value for our shareholders through effective,
ethical management of our company. Our Board of Directors has implemented strong corporate governance policies that align
with best practices for publicly held companies and the evolving expectations of shareholders and institutional investors.
•
Independent Board Oversight: We have an independent and diverse Board, led by an independent chairman. The
Board maintains objective oversight as 11 out of TEGNA’s 12 Directors are independent, with CEO Dave Lougee the
only TEGNA employee represented on the Board. The separation of the roles of Chairman and CEO allows for effective,
independent Board oversight and communication, while enabling the CEO to focus on executing the strategic plan and
managing operations. The Board also conducts an annual performance evaluation to ensure the effectiveness of the
Board and its committees, as well as the broader Board leadership structure.
15
•
•
•
Active, Engaged Board: Our directors spend significant time engaged in strategy discussions in order to identify
potential opportunities to create value for our shareholders. The Board also oversees risk management through regular
discussions with senior leadership, considering risks in the context of our strategic plan and operations. Directors play a
key role in TEGNA’s extensive shareholder engagement program, which actively seeks feedback from investors to gain
a better perspective on our management and performance in key areas.
Experience Aligned with Long-Term Strategy: Since 2017, TEGNA has undergone a Board refreshment process to
ensure Directors’ expertise align with TEGNA’s strategic evolution. During this period, we added four independent
Directors with deep expertise in media, technology, social/digital, and capital markets and transactional experience.
Commitment to Diversity and Inclusion: Our Board and management are committed to ensuring our company
reflects the diversity of the communities we serve. To strengthen accountability on diversity into the governance of our
company, in 2020 TEGNA’s Board adopted specific areas of oversight for each Board committee regarding how we
approach diversity:
◦
◦
◦
◦
The Leadership Development & Compensation Committee is responsible for monitoring and supporting our
performance in diversity, inclusion and equal employment opportunity, and the continuation of our efforts to
gain and maintain diversity among our employees and management.
The Nominating & Governance Committee is responsible for overseeing the racial, ethnic and gender diversity
of the Board.
The Public Policy and Regulatory Committee reviews with management our approach to, and initiatives and
support for, promoting racial and ethnic diversity in our news and other content, through inclusive journalism
and racial and ethnic diversity in our editorial decision-making and leadership.
The Audit Committee is responsible for monitoring our finance and asset management-related diversity and
inclusion efforts, including our investment and purchasing involving minority-owned businesses.
In addition to the corporate governance practices discussed above, other important corporate governance practices we follow
include:
• All of our directors are elected annually;
• Our directors and senior executives are subject to stock ownership guidelines;
• We do not have a shareholder rights plan (poison pill) in place;
• Our Board has adopted a proxy access by-law provision; and
• Mergers and other business combinations involving the Company generally may be approved by a simple majority vote.
Additional information regarding our corporate governance practices is included in our Principles of Corporate Governance
posted on the Corporate Governance page under the “Investors” menu of our website at www.tegna.com.
16
MARKETS WE SERVE
TELEVISION STATIONS AND AFFILIATED DIGITAL PLATFORM
State/District of
Columbia
Alabama
Arizona
Arkansas
California
Colorado
Connecticut
Huntsville
Flagstaff
Mesa
Tucson
Fort Smith
Little Rock
Sacramento
San Diego
Denver
Hartford
Waterbury
City
Station/web site
WZDX(TV): rocketcitynow.com
KNAZ-TV: 12news.com
KPNX(TV): 12news.com
KMSB(TV): tucsonnewsnow.com
KTTU(TV): tucsonnewsnow.com
Ch. 18/MNTV
KFSM-TV: 5newsonline.com
KTHV(TV): thv11.com
KXTV(TV): abc10.com
KFMB-TV (3): cbs8.com
KTVD(TV): my20denver.com
KUSA(TV): 9news.com
WTIC-TV: fox61.com
WCCT-TV: yourcwtv.com/partners/hartford
WUSA(TV): wusa9.com
District of Columbia Washington
Florida
Jacksonville
WJXX(TV): firstcoastnews.com
Georgia
Idaho
Illinois
Indiana
Iowa
Kentucky
Louisiana
Maine
Michigan
Minnesota
Missouri
New York
North Carolina
Ohio
Oregon
Pennsylvania
South Carolina
Tennessee
Texas
WTLV(TV): firstcoastnews.com
Tampa-St. Petersburg WTSP(TV): wtsp.com
Atlanta
WATL(TV): 11alive.com
Macon
Boise
Moline
Indianapolis
Ames
Ames
Louisville
New Orleans
Bangor
Portland
WXIA-TV: 11alive.com
WMAZ-TV: 13wmaz.com
KTVB(TV) (4): ktvb.com
WQAD-TV: wqad.com
WTHR(TV) (5): wthr.com
WOI-DT: weareiowa.com
KCWI-TV: weareiowa.com
WHAS-TV: whas11.com
WWL-TV: wwltv.com
WUPL(TV) (6): wwltv.com/mytv
WLBZ(TV): newscentermaine.com
WCSH(TV): newscentermaine.com
Grand Rapids
WZZM(TV): wzzm13.com
Minneapolis-St. Paul
KARE(TV): kare11.com
St. Louis
Buffalo
Charlotte
Greensboro
Cleveland
Columbus
Toledo
Portland
Scranton
York
Columbia
Knoxville
Memphis
Abilene
Austin
Beaumont
Corpus Christi
Dallas
Houston
Odessa
San Angelo
San Antonio
KSDK(TV): ksdk.com
WGRZ(TV): wgrz.com
WCNC-TV: wcnc.com
WFMY-TV: wfmynews2.com
WKYC-TV: wkyc.com
WBNS-TV (7): 10tv.com
WTOL(TV): wtol.com
KGW(TV) (8): kgw.com
WNEP-TV: wnep.com
WPMT(TV): fox43.com
WLTX(TV): wltx.com
WBIR-TV: wbir.com
WATN-TV: localmemphis.com
WLMT(TV): localmemphis.com
KXVA(TV): myfoxzone.com
KVUE(TV): kvue.com
KBMT(TV) (9): 12newsnow.com
KIII-TV: kiiitv.com
WFAA(TV): wfaa.com
KMPX(TV): wfaa.com
KHOU(TV): khou.com
KTBU(TV): khou.com
KWES-TV: newswest9.com
KIDY(TV): myfoxzone.com
KENS(TV): kens5.com
Tyler-Longview
KYTX(TV): cbs19.tv
17
Channel (1)/
Network
Ch. 54/FOX
Ch. 2/NBC
Ch. 12/NBC
Ch. 11/FOX
Ch. 5/CBS
Ch. 11/CBS
Ch. 10/ABC
Ch. 8/CBS
Ch. 20/MNTV
Ch. 9/NBC
Ch. 61/FOX
Ch. 20/CW
Ch. 9/CBS
Ch. 25/ABC
Ch. 12/NBC
Ch. 10/CBS
Ch. 36/MNTV
Ch. 11/NBC
Ch. 13/CBS
Ch. 7/NBC
Ch. 8/ABC
Ch. 13/NBC
Ch. 5/ABC
Ch. 23/CW
Ch. 11/ABC
Ch. 4/CBS
Ch. 54/MNTV
Ch. 2/NBC
Ch. 6/NBC
Ch. 13/ABC
Ch. 11/NBC
Ch. 5/NBC
Ch. 2/NBC
Ch. 36/NBC
Ch. 2/CBS
Ch. 3/NBC
Ch. 10/CBS
Ch. 11/CBS
Ch. 8/NBC
Ch. 16/ABC
Ch. 43/FOX
Ch. 19/CBS
Ch. 10/NBC
Ch. 24/ABC
Ch. 30/CW
Ch. 15/FOX
Ch. 24/ABC
Ch. 12/ABC
Ch. 3/ABC
Ch. 8/ABC
Ch. 29 / Estrella
Ch. 11/CBS
Ch. 55/Quest
Ch. 9/NBC
Ch. 6/FOX
Ch. 5/CBS
Ch. 19/CBS
Affiliation
Agreement
Expires in
Market TV
Households
(2)
Founded
2022
2024
2024
2022
2022
2022
2022
2023
2023
2022
2024
2022
2021
2022
2023
2024
2022
2022
2024
2022
2024
2023
2024
2022
2021
2023
2022
2022
2024
2024
2023
2024
2024
2024
2024
2022
2024
2022
2023
2024
2023
2022
2022
2024
2022
2021
2022
2023
2023
2023
2023
2025
2022
N/A
2024
2022
2022
2022
409,200
2,158,240
2,158,240
479,780
479,780
327,930
562,060
1,459,260
1,132,300
1,798,440
1,798,440
1,002,710
1,002,710
2,565,580
756,960
756,960
2,035,250
2,648,970
2,648,970
243,340
311,270
298,580
1,182,500
457,040
457,040
696,070
663,520
663,520
141,120
409,560
781,080
1,887,390
1,239,210
612,780
1,290,660
717,110
1,511,970
999,300
408,590
1,315,470
571,470
772,810
421,760
535,230
619,610
619,610
116,310
912,400
168,210
210,160
2,962,520
2,962,520
2,569,900
2,569,900
173,210
58,000
1,031,180
276,520
1985
1970
1953
1967
1984
1956
1955
1955
1949
1988
1952
1984
1953
1949
1989
1957
1965
1954
1948
1953
1953
1963
1957
1950
1999
1950
1957
1955
1954
1953
1962
1953
1947
1954
1967
1949
1948
1949
1958
1956
1954
1952
1953
1956
1978
1983
2001
1971
1961
1964
1949
1993
1953
2004
1958
1984
1950
2008
TELEVISION STATIONS AND AFFILIATED DIGITAL PLATFORM
(Continued)
State/District of
Columbia
City
Station/web site
Temple
KCEN-TV (10): kcentv.com
Virginia
Hampton/Norfolk
WVEC(TV): 13newsnow.com
Washington
Seattle/Tacoma
KING-TV: king5.com
Spokane
KONG(TV): king5.com
KREM(TV): krem.com
KSKN(TV): spokanescw22.com
Channel (1)/
Network
Affiliation
Agreement
Expires in
Market TV
Households
(2)
Founded
Ch. 9/NBC
Ch. 13/ABC
Ch. 5/NBC
Ch. 16/IND
Ch. 2/CBS
Ch. 22/CW
2024
2023
2024
N/A
2022
2021
383,820
725,580
2,098,800
2,098,800
470,210
470,210
1953
1953
1948
1997
1954
1983
(1) Channel refers to the viewer-facing “virtual” channel associated with the station’s brand, which may differ from the radio frequency channel on which the station transmits.
(2) Market TV households is number of television households in each market, according to 2020-2021 Nielsen figures.
(3) KFMB also operates a sub-channel (CW channel), which is not counted.
(4) We also own KTFT-LD (NBC), a low power television station in Twin Falls, ID.
(5) We also own WALV-CD, a Class A television station in Indianapolis, IN.
(6) We also own WBXN-CD, a Class A television station in New Orleans, LA.
(7) We also own two radio stations, WBNS(AM) (1460), and WBNS-FM (97.1).
(8) We also own KGWZ-LD, a low power television station in Portland, OR.
(9) KBMT also operates a subchannel (KJAC/NBC), which is not counted. We also own KUIL-LD, a low power station in Beaumont, TX.
(10) We also own KAGS-LP, a low power television station in Bryan, TX.
In addition to the above television station properties, we also have the following digital and multicast network operations which
support our television stations:
Premion: www.premion.com Headquarters: New York, NY
TEGNA Marketing Solutions: www.TEGNAmarketingsolutions.com
True Crime Network and Quest multicast networks: www.truecrimenetworktv.com and www.questtv.com
Locked On Podcast Network: www.lockedonpodcasts.com
INVESTMENTS
We have non-controlling ownership interests in the following companies:
Bustle Digital Group: www.bustle.com
CareerBuilder: www.careerbuilder.com
Hudson MX: www.hudsonmx.com
Jackpocket Inc: www.jackpocket.com
Kin Community: www.kincommunity.com
MadHive: www.madhive.com
Pearl: www.pearltv.com
SIGNIA Venture Partners: www.signiaventurepartners.com
ViewLift: www.viewlift.com
Video Call Center: www.thevcc.tv
Vizbee: www.vizbee.tv
Whistle Sports: www.teamwhistle.com
TEGNA ON THE NET: News and information about us is available on our web site, www.TEGNA.com. In addition to news and other
information about us, we provide access through this site to our annual report on Form 10-K, our quarterly reports on Form 10-Q, our current
reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after we file or furnish them electronically to the
Securities and Exchange Commission (SEC). Certifications by our Chief Executive Officer and Chief Financial Officer are included as exhibits
to our SEC reports (including to this Form 10-K). We also provide access on this web site to our Principles of Corporate Governance, the
charters of our Audit, Leadership Development and Compensation, Nominating and Governance, and Public Policy and Regulation Committees
and other important governance documents and policies, including our Ethics and Inside Trading Policies. Copies of all of these corporate
governance documents are available to any shareholder upon written request made to our Secretary at the headquarters address. We will
disclose on this web site changes to, or waivers of, our corporate ethics policy.
Certain factors affecting forward-looking statements
Certain statements in this Annual Report on Form 10-K that do not describe historical facts may constitute forward-looking
statements as that term is defined in the Private Securities Litigation Reform Act of 1995, including statements regarding
business strategies, market potential, future financial performance and other matters, which include, but are not limited to the
adverse impacts caused by the COVID-19 pandemic and its effect on our revenues, particularly our non-political advertising
revenues. The words “believe,” “expect,” “estimate,” “could,” “should,” “intend,” “may,” “plan,” “seek,” “anticipate,” “project” and
similar expressions, among others, generally identify “forward-looking statements”. These forward-looking statements are subject
to certain risks and uncertainties that could cause actual results and events to differ materially from those anticipated in the
forward-looking statements, including those described within Part II, Item 1A “Risk Factors” in this Annual Report.
18
Our actual financial results may be different from those projected due to the inherent nature of projections. Given these
uncertainties, forward-looking statements should not be relied on in making investment decisions. The forward-looking
statements contained in this Form 10-K speak only as of the date of its filing. Except where required by applicable law, we
expressly disclaim a duty to provide updates to forward-looking statements after the date of this Form 10-K to reflect subsequent
events, changed circumstances, changes in expectations, or the estimates and assumptions associated with them. The forward-
looking statements in this Form 10-K are intended to be subject to the safe harbor protection provided by the federal securities
laws.
ITEM 1A. RISK FACTORS
An investment in our common stock involves risks and uncertainties and investors should consider carefully the following risk
factors before investing in our securities. We seek to identify, manage and mitigate risks to our business, but risk and uncertainty
cannot be eliminated or necessarily predicted. The risks described below may not be the only risks we face. Additional risks that
we do not yet perceive or that we currently believe are immaterial may adversely affect our business and the trading price of our
securities.
Risks Related to Our Business and Industry
We are impacted by demand for advertising, which, in turn, depends on a number of factors, some of which are cyclical
and many of which are beyond our control
In 2020, 40% of our revenues were derived from television spot and digital advertising. Demand for advertising is highly
dependent upon the strength of the U.S. economy, both in the markets our stations serve and in the nation as a whole. During an
economic downturn, demand for advertising often decreases. Consequently, our operating results depend on the relative
strength of the economy in our principal television markets as well as the strength or weakness of regional and national
economic factors. A decline in economic conditions in the U.S. could have a significant adverse impact on our businesses and
could significantly impact our television spot and digital advertising revenues.
Our advertising revenues can also be affected by a variety of other factors outside our control, including, among other things,
the viewership of the programming offered by our television stations, local and national advertising price fluctuations, the duration
and extent of any network preemption of regularly scheduled programming for any reason, and labor disputes or other
disruptions at programming providers, networks or professional sports leagues. Our advertising revenues can also vary
substantially from year to year, driven by the political election cycle (i.e., even years); the ability and willingness of candidates
and political action committees to raise and spend funds on television and digital advertising; and the competitiveness of the
election races in our stations’ markets.
Competition from alternative forms of media may impair our ability to grow or maintain revenue levels in traditional and
new businesses
Advertising and marketing services produce a significant portion of our revenues, with our stations’ affiliated desktop, mobile
and tablet advertising revenues, as well as our OTT product offerings being important components. Technology, particularly new
video formats, streaming and downloading capabilities via the Internet, video-on-demand, personal video recorders and other
devices and technologies used in the entertainment industry continues to evolve rapidly, leading to alternative methods for the
delivery and storage of digital content. These technological advancements have driven changes in consumer behavior and have
empowered consumers to seek more control over when, where and how they consume news and entertainment, including
through so-called “cutting the cord” and other consumption strategies.
These innovations may affect our ability to generate television audience, which may make our television stations less
attractive to advertisers. For example, increasing demand for content generated for consumption through other forms of media
such as Amazon Prime, Disney+, HBO Go, Hulu, or Netflix, could cause our advertising revenues to decline as a result of
changes to the ratings of our programming, which may materially negatively affect our business and results of operations.
A resurgence in the rate of COVID-19 infections that is significant enough to force widespread business closures could
materially and adversely affect our financial condition, results of operations and cash flows.
During the first quarter of 2020, a novel strain of coronavirus (COVID-19) believed to have been first identified in Wuhan,
China, spread globally, including to every state in the United States. On March 11, 2020, the World Health Organization declared
COVID-19 a pandemic, and on March 13, 2020, the United States declared a national emergency with respect to COVID-19. The
federal and state governments in the United States have responded by instituting a wide variety of mitigating control measures,
including, mandatory quarantines, closures of non-essential businesses and all other places of social interaction, while
implementing “shelter in place” orders and restricting travel. Such control measures have resulted in cancellation or
postponement of sporting events, including the Olympics, and suspension of popular entertainment content production. The
mitigating control measures began negatively impacting our AMS revenue stream in mid-March 2020 as demand for non-political
advertising and marketing services softened. During the second and third quarters of 2020, certain state and local governments
began to implement multi-step policies towards re-opening and lifting the control measures. Demand for many sectors’
19
advertising and marketing services increased as this occurred. However, some states which re-opened also experienced
increases in new COVID-19 cases, forcing some to reinstate control measures and restrict public gatherings. Through the end of
the fourth quarter of 2020, case and fatality figures continued to trend upwards, both nationally and in many states, though
several vaccines have now been approved for emergency use and are beginning to be distributed.
The extent of the pandemic’s impact on our financial and operational results, which could be material, will depend on the
length of time that the pandemic continues and whether we experience further waves of the infection, its effect on our customers’
demand for our advertising products (as well as their ability to pay us for services provided), the pace at which governmental
regulations closing businesses and restricting movement imposed in response to the pandemic are relaxed, the success of
public vaccination campaigns, the effectiveness of the vaccines against mutating strains of the virus, the effect of existing and
potential economic stimulus measures passed into law, as well as uncertainty regarding all of the foregoing.
While we cannot at this time predict the full impact of the COVID-19 pandemic, it has had, and is likely to continue to have a
dampening effect on our near-term AMS revenues. In addition, a sustained adverse impact on our non-political advertising from
the COVID-19 pandemic could eventually impact our ability to maintain compliance with covenants under our revolving credit
facility in the future further affecting our liquidity and financial condition. In addition, we may experience an increased risk of
undetected malicious cyber-security attacks due to our workforce working remotely. We continue to closely monitor the situation,
to assess further possible implications to our business and customers, and to take actions in an effort to mitigate adverse
consequences.
The value of our assets or operations may be diminished if our information technology systems fail to perform
adequately
Our information technology systems are critically important to operating our business efficiently and effectively. We rely on our
information technology systems to manage our business data, communications, news and advertising content, digital products,
order entry, fulfillment and other business processes. The failure of our information technology systems to perform as we
anticipate could disrupt our business and could result in transaction errors, processing inefficiencies, broadcasting disruptions,
and loss of sales and customers, causing our business and results to be impacted.
Our efforts to minimize the likelihood and impact of adverse cybersecurity incidents and to protect our technology and
confidential information may not be successful and our business could be negatively affected
Our information technology systems are critically important to operating our business efficiently and effectively. We rely on our
information technology systems to manage our business data, communications, news and advertising content, digital products,
order entry, fulfillment and other business processes. As such, we are exposed to various cybersecurity threats, including but not
limited to, threats to our information technology infrastructure, and unauthorized attempts to gain access to our confidential
information, including third parties which receive our confidential information for business purposes. We take measures to
minimize the risk of a cyber-attack including utilization of multi-factor authentication, deployment of firewalls, virtual private
networks for mobile connections and conducting regular training of our employees related to protecting sensitive information and
recognizing “phishing” attacks. These measures, however, may not be sufficient in preventing or timely detecting breaches or
cyber-attacks due to the evolving nature and ever-increasing abilities of cyber-attacks. Depending on the severity of the breach
or cyber-attack, such events could result in business interruptions, disclosure of nonpublic information, loss of sales and
customers, misstated financial data, liabilities for stolen assets or information, diversion of our management’s attention,
transaction errors, processing inefficiencies, increased cybersecurity protection costs, litigation, and financial consequences, any
or all of which could adversely affect our business operations and reputation. In addition, cybersecurity breaches could subject
us to civil liability to customers and other third parties as well as fines and penalties imposed by governmental or regulatory
authorities which could be substantial. We maintain cyber risk insurance, but this insurance may be insufficient to cover all of our
losses from breaches of our systems.
As has historically been the case in the broadcast sector, loss of, or changes in, affiliation agreements or
retransmission consent agreements could adversely affect operating results for our stations
Most of our stations are covered by our network affiliation agreements with the major broadcast television networks (ABC,
CBS, NBC, and Fox). These television networks produce and distribute programming in exchange for each of our stations’
commitment to air the programming at specified times and for other consideration such as commercial announcement time
during the programming. The cost of network affiliation agreements represents a significant portion of our television operating
expenses.
Each of our affiliation agreements has a stated expiration date. With respect to the major broadcast networks, our principal
expirations occur in the following years: NBC-early 2024, CBS-2022, Fox-2022, ABC-2023. If renewed, our network affiliation
agreements may be renewed on terms that are less favorable to us. The non-renewal or termination of any of our network
affiliation agreements would prevent us from being able to carry programming of the affiliate network. This loss of programming
would require us to obtain replacement programming, which may involve higher costs and/or which may not be as attractive to
our audiences, resulting in reduced revenues.
20
In recent years, the networks have streamed their programming on the Internet and other distribution platforms (e.g., CBS All
Access and Peacock NBC), in some cases live or within a short period of the original network programming broadcast on local
television stations, including those we own. An increase in the availability of network programming on alternative platforms that
either bypass or provide less favorable terms to local stations - such as cable channels, the Internet and other distribution
vehicles - may dilute the exclusivity and value of network programming originally broadcast by the local stations and could
adversely affect the business, financial condition and results of operations of our stations.
Our retransmission consent agreements with major cable, satellite and telecommunications service providers (also referred to
as multichannel video programming distributors or MVPDs) permit them to retransmit our stations’ signals to their subscribers in
exchange for the payment of compensation to us (which we classify as subscription revenues). This source of revenue
represented approximately 44% of our 2020 total revenues, and we expect the contribution of subscription revenues to increase
in 2021 and to continue to increase in the foreseeable future periods. During 2020, retransmission consent agreements covering
approximately 35% of our subscribers were renewed. During 2021, retransmission agreements related to approximately 30% of
our subscribers will be up for renewal. On occasion, we may not be able to agree on mutually acceptable terms when negotiating
such agreements. When this happens, the MVPD may be required to cease airing our programming (commonly referred to as a
“blackout” or “going dark”). When this happens, we will not be compensated by the MVPD during the period of the blackout.
Furthermore, if we are unable to renew the agreement on market terms, or at all, it could negatively impact our business,
financial condition and results of operations.
We operate our business in a single broadcast segment, which increases our exposure to the changes and highly
competitive environment of the broadcast industry
Broadcast companies operate in a highly competitive environment and compete for audiences, advertising and marketing
services revenue and quality programming. Lower audience share, declines in advertising and marketing services spending, and
increased programming costs would adversely affect our business, financial condition and results of operations. There can be no
assurance that we will be able to compete successfully against existing, new or potential competitors, or that competition and
consolidation in the media marketplace will not have a material adverse effect on our business, financial condition or results of
operations.
In addition, the FCC and Congress are contemplating several new laws and changes to existing media ownership and other
broadcast-related regulations, regarding a wide range of matters (including the number of stations a company may own within a
single market or nationwide). Changes to FCC rules may lead to additional opportunities as well as increased uncertainty in the
industry.
Changing regulations may also impair or reduce our leverage in negotiating affiliation or retransmission agreements,
adversely affecting our revenues, or result in increased costs, reduced valuations for certain broadcasting properties or other
impacts, all of which may adversely impact our future profitability. All of our stations are required to hold broadcasting licenses
from the FCC; when granted, these licenses are generally granted for a period of eight years. Under certain circumstances, the
FCC is not required to renew any license and could decline to renew future license applications.
Changes in the regulatory environment could increase our costs or limit our opportunities for growth
Our stations are subject to various obligations and restrictions under the Communications Act of 1934 as amended (the
“Communications Act”), and FCC regulations. These requirements may be affected by legislation, FCC actions, or court
decisions, and any such changes may affect the performance of our business, such as by imposing new obligations or by limiting
our television stations’ exclusivity or retransmission consent rights. For instance, although the FCC voted in November 2017 to
reduce restrictions on local broadcast ownership, the U.S. Court of Appeals for the Third Circuit vacated and remanded these
changes effective as of November 29, 2019; the U.S. Supreme Court granted petitions by the FCC and broadcasters to review
the Third Circuit’s decision. Depending on the Supreme Court’s decision, the FCC’s 2017 regulatory changes could be restored,
or the applicable media ownership rules could be altered in other ways by Congress or the FCC. Oral arguments in the case
were held on January 19, 2021; the Supreme Court is expected to rule on the case by the end of June 2021. If broadcast
ownership rules become more restrictive, our opportunities to grow our broadcast business through acquisitions or other
strategic transactions could be impaired.
In addition, some of our acquisition activities may be subject to antitrust review by the Antitrust Division of the Department of
Justice (DOJ), and could restrict our ability to pursue or consummate future transactions and could require us to divest certain
television stations if an acquisition would result in excessive concentration in a market. Review and enforcement policies of the
DOJ may be subject to change under the Biden administration. As a result, we cannot assure investors that any future
acquisition will be approved, or that a requirement to divest existing stations will not have an adverse effect on the transaction or
our business.
21
Risks Related to Ownership of Our Common Stock
There could be significant liability if the spin-off of Cars.com was determined to be a taxable transaction
In May 2017 we completed our spin-off of Cars.com, which we refer to as the “spin-off”. In connection with the spin-off, we
received an opinion from outside tax counsel to the effect that the requirements for tax-free treatment under Section 355 of the
Internal Revenue Code were satisfied. The opinion relies on certain facts, assumptions, representations and undertakings from
TEGNA and the spun-off business regarding the past and future conduct of the company’s business and other matters. If any of
these facts, assumptions, representations or undertakings is incorrect or not satisfied, TEGNA and its stockholders may not be
able to rely on the opinion of tax counsel and could be subject to significant tax liabilities.
Notwithstanding the opinion of tax counsel, the Internal Revenue Service could determine on audit that the spin-off is taxable
if it determines that any of these facts, assumptions, representations or undertakings were incorrect or have been violated or if it
disagrees with the conclusions in the opinion, or for other reasons, including as a result of certain significant changes in the
share ownership of TEGNA or the spun-off business after the separation. If the spin-off was determined to be taxable for U.S.
federal income tax purposes, TEGNA and its stockholders that are subject to U.S. federal income tax could incur significant U.S.
federal income tax liabilities. On October 15, 2021, TEGNA’s 2017 tax year (including the tax-free treatment of the spin-off of the
Cars.com business) will no longer be subject to examination by the Internal Revenue Service.
A proxy contest with an activist shareholder could cause us to incur significant costs, divert management’s attention
and resources, and have an adverse effect on our business
Activist shareholders, like Standard General, may from time to time engage in proxy solicitations, advance shareholder
proposals or director nominations or otherwise attempt to affect changes or acquire control over us. On January 21, 2021,
Standard General nominated four directors for election in connection with our 2021 Annual Meeting of Shareholders.
Responding to these actions can be costly and time-consuming and divert the attention of our Board and management from the
management of our operations and the pursuit of our business strategies, particularly if such activist shareholders advocate for
actions that are not supported by other shareholders, our board or management. In addition, perceived uncertainties as to our
future direction may result in the loss of potential business opportunities, damage to our reputation and may make it more difficult
to attract and retain qualified directors, personnel and business partners. These actions could also cause our stock price to
experience periods of volatility.
Our strategic acquisitions, investments and partnerships could pose various risks, increase our leverage and may
significantly impact our ability to expand our overall profitability
Acquisitions involve inherent risks, such as increasing leverage and debt service requirements and combining company
cultures and facilities, which could have a material adverse effect on our results of operations or cash flow and could strain our
human resources. We may be unable to successfully complete acquisitions, implement effective cost controls, achieve expected
synergies or increase revenues as a result of an acquisition. Acquisitions may result in us assuming unexpected liabilities and in
management diverting its attention from the operation of our business. Acquisitions may result in us having greater exposure to
the industry risks of the businesses underlying the acquisition. Strategic investments and partnerships with other companies
expose us to the risk that we may be unable to control the operations of our investee or partnership, which could decrease the
amount of benefits we realize from a particular relationship. We are exposed to the risk that our partners in strategic investments
and infrastructure may encounter financial difficulties which could disrupt investee or partnership activities, or impair assets
acquired, which would adversely affect future reported results of operations and shareholders’ equity. The failure to obtain
regulatory approvals or required consents of broadcast television networks or other third parties may prevent us from completing
or realizing the anticipated benefits of acquisitions. Furthermore, acquisitions may subject us to new or different regulations
which could have an adverse effect on our operations.
Volatility in the U.S. credit markets could significantly impact our ability to obtain new financing to fund our operations
and strategic initiatives or to refinance our existing debt at reasonable rates and terms as it matures
As of December 31, 2020, we had approximately $3.58 billion in debt and approximately $1.13 billion of undrawn additional
borrowing capacity under our revolving credit facility that expires in 2024. This debt matures at various times during the years
2024-2029. While our cash flow is expected to be sufficient to pay amounts when due, if our operating results deteriorate
significantly, we may not be able to pay amounts when due and a portion of these maturities may need to be refinanced. Access
to the capital markets for longer-term financing is generally unpredictable and volatile credit markets could make it harder for us
to obtain debt financings.
22
The value of our existing intangible assets may become impaired, depending upon future operating results
Goodwill and other intangible assets were approximately $5.47 billion as of December 31, 2020, representing approximately
80% of our total assets. Goodwill and indefinite-lived intangible assets are subject to annual impairment testing and more
frequent testing upon the occurrence of certain events or significant changes in circumstance that indicate all or a portion of their
carrying values may no longer be recoverable in which case a non-cash charge to earnings may be necessary. We may
subsequently experience market pressures which could cause future cash flows to decline below our current expectations, or
volatile equity markets could negatively impact market factors used in the impairment analysis, including earnings multiples,
discount rates, and long-term growth rates. Any future evaluations requiring an asset impairment charge for goodwill or other
intangible assets would adversely affect future reported results of operations and shareholders’ equity, although such charges
would not affect our cash flow.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
The types of properties required to support our television stations include offices, studios, sales offices, tower and transmitter
sites. A listing of television station locations can be found on page 17. Our digital and multicast businesses that support our
broadcast operations lease their facilities. This includes facilities for executive offices, sales offices and data centers. A listing of
our digital businesses locations can be found on page 18. We lease our corporate headquarters facility which is located in
Tysons, VA. We believe that none of our individual properties represents a material amount of the total properties owned or
leased.
We believe all of our owned and leased facilities are in satisfactory condition, are well maintained, and are adequate for
current use.
ITEM 3. LEGAL PROCEEDINGS
Information regarding legal proceedings may be found in Note 12 of the Notes to consolidated financial statements.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
Our approximately 219.7 million outstanding shares of common stock were held by 6,232 shareholders of record as of
February 19, 2021. Our shares are traded on the New York Stock Exchange (NYSE) with the symbol TGNA.
Purchases of Equity Securities
In December 2020, our Board of Directors authorized the renewal of our share repurchase program for up to $300.0 million
of our common stock over the next three years. The program was previously suspended on March 20, 2019 simultaneously with
the announcement of our acquisition of the Nexstar-Tribune divestiture stations to prioritize use of cash for debt repayment
associated with those acquisitions. The renewal of the share repurchase program reflects the reduction of leverage ratio to pre-
acquisition levels, as well as demonstrates the Board’s and management’s confidence in the business and continued focus on
making prudent, disciplined decisions intended to drive near and long-term shareholder value. Our capital allocation decisions
focus on optimizing investments in organic and inorganic growth opportunities, paying down debt, issuing dividends, and
repurchasing shares.
Dividend Policy
Since 2017, we have been paying a regular quarterly cash dividend of $0.07 per share. We paid dividends totaling $76.5
million in 2020 and $60.6 million in 2019. We expect to continue paying comparable regular cash dividends in the future. The rate
and frequency of future dividends will depend on future earnings, capital requirements and financial condition and other factors
considered relevant by our Board of Directors.
ITEM 6. SELECTED FINANCIAL DATA
Excluded pursuant to Regulation S-K Item 301, as amended.
23
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Introduction
We are an innovative media company serving the greater good of our communities. Our business includes 64 television
stations and two radio stations in 51 U.S. markets, we are the largest owner of top four network affiliates in the top 25 markets
among independent station groups, reaching approximately 39% of U.S. television households. We also own leading multicast
networks True Crime Network and Quest. Each television station also has a robust digital presence across online, mobile and
social platforms, reaching consumers on all devices and platforms they use to consume news content. We have been
consistently honored with the industry’s top awards, including Edward R. Murrow, Alfred I. DuPont and Emmy Awards. Through
TEGNA Marketing Solutions (TMS), our integrated sales and back-end fulfillment operations, we deliver results for advertisers
across television, digital, and Over the Top (OTT) platforms, including Premion, our OTT advertising network.
We have one operating and reportable segment. The primary sources of our revenues are: 1) subscription revenues,
reflecting fees paid by satellite, cable, OTT (companies that deliver video content to consumers over the Internet) and
telecommunications providers to carry our television signals on their systems; 2) advertising & marketing services (AMS)
revenues, which include local and national non-political television advertising, digital marketing services (including Premion), and
advertising on the stations’ websites and tablet and mobile products; 3) political advertising revenues, which are driven by even
year election cycles at the local and national level (e.g., 2020, 2018) and particularly in the second half of those years; and 4)
other services, such as production of programming and advertising material.
COVID-19 pandemic: During fiscal year 2020 and continuing into 2021, the world has been, and continues to be, impacted
by the novel coronavirus (COVID-19) pandemic. The COVID-19 pandemic has brought unprecedented challenges and
widespread economic and social change throughout the United States. In an effort to contain the virus the federal and state
governments in the United States responded by instituting a wide variety of mitigating control measures, including, mandatory
quarantines, closures of non-essential businesses and all other places of social interaction, while implementing “shelter in place”
orders and travel restrictions in an effort to slow the spread of the virus. Such mitigating measures began negatively impacting
our AMS revenue stream in mid-March 2020 as demand for non-political advertising softened. While some of these measures
have been lifted or relaxed in certain state and local governments, other jurisdictions have seen increases in new COVID-19
cases resulting in restrictions being reinstated, or new restrictions imposed. Overall, advertising demand improved as steps
toward economic re-opening were implemented and as federal government stimulus programs were enacted. Our AMS revenues
have shown quarterly sequential improvement since the height of the pandemic in the second quarter of 2020. There continues
to be considerable uncertainty regarding how current and future health and safety measures implemented in response to the
pandemic will impact our business.
Due to the changing nature and continuing uncertainty around the COVID-19 pandemic, our ability to predict the impact of
COVID-19 on our financial condition, results of operations, liquidity and our business in future periods remains limited. While we
use the best information available in developing significant estimates included in our financial statements, the effects of the
pandemic on our operations may not be fully realized, or reflected in our financial results, until future periods. As such, actual
results could differ from our estimates, and these differences resulting from changes in facts and circumstances could be
material.
Seasonality: Our revenues and operating results are subject to seasonal fluctuations. Generally, our second and fourth
quarter revenues and operating results are stronger than those we report for the first and third quarter. This is driven by the
second quarter reflecting increased spring seasonal advertising, while the fourth quarter typically includes increased advertising
related to the holiday season. In addition, our revenue and operating results are subject to significant fluctuations across yearly
periods resulting from political advertising. In even numbered years, political spending is usually significantly higher than in odd
numbered years due to advertising for the local and national elections. Additionally, every four years, we typically experience
even greater increases in political advertising in connection with the presidential election. The strong demand for advertising from
political advertisers in these even years can result in the significant use of our available inventory (leading to a “crowd out”
effect), which can diminish our AMS revenue in the even year of a two year election cycle, particularly in the fourth quarter of
those years.
24
Consolidated Results from Operations
The following discussion is a comparison of our consolidated results on a GAAP basis. The year-to-year comparison of
financial results is not necessarily indicative of future results. In addition, see the section on page 30 titled ‘Operating results non-
GAAP information’ for additional tables presenting information which supplements our financial information provided on a GAAP
basis.
During 2019, we acquired multiple local television stations and multicast networks. Specifically, we acquired the Gray stations
(January 2, 2019), Justice (recently rebranded as True Crime Network) and Quest multicast networks (June 18, 2019), the
Dispatch stations (August 8, 2019) and the Nexstar stations (September 19, 2019). See Note 2 to the consolidated financial
statements for further details. The multicast networks, Dispatch stations, and Nexstar stations are collectively referred to as the
“2019 Acquisitions” in the discussion that follows. These 2019 Acquisitions did not contribute to the periods prior to their
acquisition in our financial statements which impacts the year-to-year comparability of our consolidated operating results. The
Gray stations do not impact the 2020 to 2019 year-to-year comparability, but do impact 2020 to 2018 year-to-year comparability.
As discussed above, our operating results are subject to significant fluctuations across yearly periods (driven by even-year
election cycles). As such, our management team and Board of Directors also review current period operating results compared to
the prior two year period (e.g., 2020 vs. 2018). We believe this comparison will also provide useful information to investors, and
therefore, we have supplemented our prior year comparison of consolidated results to also include a comparison against 2018
results (through operating income). For purposes of this comparison, the definition of “2019 Acquisitions” also includes the
operating results of the Gray stations (as this acquisition does impact the 2020 to 2018 year-to-year comparability).
For a comparative discussion of our results of operations for the years ended December 31, 2019 and December 31, 2018,
see “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our annual
report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 2, 2020.
A consolidated summary of our results is presented below (in thousands):
2020
2019
Change
from
2019
2018
Change
from
2018
Revenues:
$
2,937,780 $
2,299,497
28% $
2,207,282
33%
Operating expenses:
Cost of revenues
Business units - Selling, general and administrative
expenses
Corporate - General and administrative expenses
Depreciation
Amortization of intangible assets
Spectrum repacking reimbursements and other, net
Total
Operating income
Non-operating income (expense):
Equity income in unconsolidated investments, net
Interest expense
Other non-operating items, net
Total
Income before income taxes
Provision for income taxes
Income from continuing operations
Earnings per share from continuing operations- basic
Earnings per share - from continuing operations diluted $
*** Not meaningful
1,503,287
1,228,237
22%
1,065,933
41%
365,601
73,295
66,880
67,690
(9,955)
2,066,798
870,982
326,804
80,144
60,525
50,104
(5,335)
1,740,479
559,018
12%
(9%)
10%
35%
87%
19%
56%
10,397
(210,294)
(34,029)
(233,926)
637,056
154,293
482,763
2.20
2.19 $
10,149
(205,470)
11,960
(183,361)
375,657
89,422
286,235
1.32
1.31
2%
2%
***
28%
70%
73%
69%
67%
67% $
315,320
52,467
55,949
30,838
(11,701)
1,508,806
698,476
13,792
(192,065)
(11,496)
(189,769)
508,707
107,367
401,340
1.86
1.85
16%
40%
20%
***
(15%)
37%
25%
(25%)
9%
***
23%
25%
44%
20%
18%
18%
25
Revenues
Our Subscription revenue category includes revenue earned from cable and satellite providers for the right to carry our
signals and the distribution of TEGNA stations on OTT streaming services. Our AMS category includes all sources of our
traditional television advertising and digital revenues including Premion and other digital advertising and marketing revenues
across our platforms.
While we expect the impacts of the COVID-19 pandemic to continue to have a dampening effect on non-political advertising
placements and revenues while containment measures are in place and possibly longer, it is too early to tell with any kind of
precision how or the extent to which future declines in non-political advertising revenues, particularly with respect to local AMS
advertising, will impact our revenues and operating results in future quarters.
The following table summarizes the year-over-year changes in our revenue categories (in thousands):
Subscription
Advertising & Marketing Services
Political
Other
Total revenues
*** Not meaningful
2020 vs. 2019
2020
1,286,611 $
1,174,774
445,535
30,860
2,937,780 $
2019
1,005,030
1,226,607
38,478
29,382
2,299,497
$
$
Change from
2019
28%
(4%)
***
5%
28%
$
$
2018
840,838
1,106,754
233,613
26,077
2,207,282
Change from
2018
53%
6%
91%
18%
33%
Total revenues increased $638.3 million in 2020. Our 2019 Acquisitions contributed $296.7 million to this increase. Excluding
the 2019 Acquisitions from both periods, total revenues increased $341.6 million. This increase was primarily due to a $363.8
million increase in legacy station political advertising, reflecting increased spending on the elections and a $141.3 million
increase in legacy subscription revenue from annual rate increases under existing and newly renegotiated retransmission
agreements. This increase was partially offset by a decline in legacy AMS revenue of $166.2 million primarily driven by reduced
advertising demand caused by COVID-19, partially offset by increases from Premion revenue.
2020 vs. 2018
Total revenues increased $730.5 million in 2020. Our 2019 Acquisitions contributed $480.8 million to this increase. Excluding
the 2019 Acquisitions, total revenues increased $249.7 million. This increase was primarily due to a $236.6 million increase in
legacy subscription revenue from annual rate increases under existing and newly renegotiated retransmission agreements and a
$161.7 million increase in legacy station political advertising, reflecting increased spending on the elections. This increase was
partially offset by a decline in legacy AMS revenue of $153.8 million primarily driven by reduced advertising demand caused by
COVID-19, partially offset by increases from Premion revenue.
Cost of revenues
2020 vs. 2019
Cost of revenues increased $275.1 million in 2020. Our 2019 Acquisitions contributed $152.0 million to this increase.
Excluding the 2019 Acquisitions from both periods, cost of revenues increased $123.1 million. This increase was primarily due to
a $120.0 million increase in programming costs, due to the combination of growth in subscription revenues (certain programming
costs are linked to such revenues) and annual fee escalators with other programming arrangements.
2020 vs. 2018
Cost of revenues increased $437.4 million in 2020. Our 2019 Acquisitions contributed $248.4 million to this increase.
Excluding the 2019 Acquisitions, cost of revenues increased $189.0 million. This increase was primarily due to a $183.1 million
increase in programming costs, due to the combination of growth in subscription revenues (certain programming costs are linked
to such revenues) and annual fee escalators with other programming arrangements.
26
Business units - Selling, general and administrative expenses
2020 vs. 2019
Business unit selling, general, and administrative (SG&A) expenses increased $38.8 million in 2020. Our 2019 Acquisitions
contributed expenses of $33.2 million to this increase. Excluding the 2019 Acquisitions from both periods, SG&A expenses
increased $5.6 million primarily due to increases to bad debt expense and outside professional services costs.
2020 vs. 2018
Business unit SG&A expenses increased $50.3 million in 2020. Our 2019 Acquisitions added business unit SG&A expenses
of $58.7 million. Excluding the 2019 Acquisitions, SG&A expenses decreased $8.4 million. The decrease was primarily the result
of an $7.7 million reduction of professional and legal costs (due to now settled Department of Justice Antitrust Division matter).
This decline was partially offset by $3.0 million primarily due to increases to bad debt expense.
Corporate - General and administrative expenses
Our corporate costs are separated from our business expenses and are recorded as general and administrative expenses in
our Consolidated Statement of Income. This category primarily consists of broad corporate management functions including
Legal, Human Resources, and Finance, as well as activities and costs not directly attributable to the operations of our media
business.
2020 vs. 2019
Corporate general and administrative expenses decreased $6.8 million in 2020. The decrease was primarily due to incurring
$36.8 million less of acquisition-related costs (principally advisory fees) due to the reduction of acquisition activity in 2020. This
decline was partially offset by incurring $23.1 million of costs for successful activism defense and $4.6 million of M&A due
diligence costs in 2020.
2020 vs. 2018
Corporate general and administrative expenses increased $20.8 million in 2020. The increase was primarily due to $23.1
million of costs for successful activism defense and $4.6 million of M&A due diligence costs in 2020. Excluding these
professional fees, corporate expenses were down approximately $6.9 million, primarily due to a decline in workforce restructuring
charges of $5.4 million as well as the full-year impact of certain cost-saving initiatives implemented in 2018.
Depreciation expense
2020 vs. 2019
Depreciation expense increased $6.4 million in 2020. Our 2019 Acquisitions contributed $8.9 million to this increase.
Excluding the impact of 2019 Acquisitions from both periods, depreciation expense decreased $2.5 million due to certain assets
reaching the end of their assumed useful lives.
2020 vs. 2018
Depreciation expense increased $10.9 million in 2020. Our 2019 Acquisitions contributed $15.0 million to the increase.
Excluding the impact of 2019 Acquisitions, depreciation expense decreased $4.1 million due to certain assets reaching the end
of their assumed useful lives.
Amortization of intangible assets
2020 vs. 2019
Intangible asset amortization expense increased $17.6 million in 2020. Intangibles from our 2019 Acquisitions contributed
$22.1 million to this increase. Excluding the impact of the 2019 Acquisitions from both periods, amortization expense decreased
$4.5 million due to certain assets reaching the end of their assumed useful lives.
2020 vs. 2018
Intangible asset amortization expense increased $36.9 million in 2020. Our 2019 Acquisitions contributed $41.1 million to this
increase. Excluding the impact of the 2019 Acquisitions, amortization expense decreased $4.2 million due to certain assets
reaching the end of their assumed useful lives.
27
Spectrum repacking reimbursements and other, net
2020 vs. 2019
We had other net gains of $10.0 million in 2020 compared to net gains of $5.3 million in 2019. The 2020 net gains primarily
consisted of $13.2 million of reimbursements received from the FCC for required spectrum repacking, partially offset by a $2.1
million impairment charge due to the retirement of a brand name and a $1.1 million FCC license impairment charge. The 2019
net gains consisted of gains of $17.0 million of reimbursements received from the Federal Communications Commission for
required spectrum repacking and a gain of $2.9 million as a result of the sale of certain real estate. These gains were partially
offset by a $5.5 million in contract termination charge and transition costs related to bringing our national sales
organization in-house and $9.1 million of non-cash charges to reduce the value of certain assets classified as held-for-sale.
2020 vs. 2018
We had other net gains of $10.0 million in 2020 compared to net gains of $11.7 million in 2018. The 2020 net gains are
discussed in the prior year comparison above. The 2018 net gains primarily consisted of $7.4 million of spectrum repack
reimbursements and a $6.0 million gain recognized on the sale of real estate in Houston.
Operating income
2020 vs. 2019
Our operating income increased $312.0 million in 2020. Our 2019 Acquisitions contributed $80.5 million to this increase.
Excluding the impact of 2019 Acquisitions from both periods, operating income increased $231.5 million. Our operating margins
were 29.6% in 2020 compared to 24.3% in 2019. The increase was driven by the changes in revenues and expenses discussed
above.
2020 vs. 2018
Operating income increased $172.5 million in 2020. Our 2019 Acquisitions contributed $117.7 million in operating income.
Excluding the impact of 2019 Acquisitions, operating income increased $54.8 million. The increase in operating income was
driven by the changes in revenues and expenses discussed above. Our operating margins were 29.6% in 2020 compared to
31.6% in 2018. The decline in margin was primarily driven by the increases in programming costs and intangible amortization.
Programming and payroll expense trends
Programming and payroll expenses are the two largest elements of our operating expenses, and are summarized below,
expressed as a percentage of total operating expenses. Programming expenses as a percentage of total operating expenses
have increased due to an increase in reverse compensation payments to our network affiliation partners associated with higher
subscription revenues. Payroll expenses have increased during 2020 primarily due to our 2019 Acquisitions, but as a percentage
of total operating expenses have decreased in 2020 primarily due to increases in programming expenses, which make up a
larger percentage of operating costs.
Expense Category
Programming expenses
Payroll expenses
Percentage of total operating expenses
2018
2019
2020
33.3%
35.5%
40.1%
29.8%
28.6%
26.7%
Non-operating income and expense
Equity income: This income statement category reflects earnings or losses from our equity method investments. Equity
income increased from $10.1 million in 2019 to $10.4 million in 2020. The 2020 income was primarily due to equity income from
our CareerBuilder investment (which sold several subsidiary businesses in 2020). The 2019 income was primarily due to a gain
of $12.2 million recognized in connection with the sale of our investment in Captivate.
Interest expense: Interest expense increased $4.8 million in 2020 as compared to 2019, primarily due to a higher average
outstanding total debt balance (reflective of borrowings to finance the 2019 Acquisitions), partially offset by lower interest rates,
driven by refinancings. The total average outstanding debt was $4.02 billion in 2020 compared to $3.37 billion in 2019. The
impact of the increase in outstanding debt was partially offset by a decrease in the weighted average interest rate on total
outstanding debt, which was 5.03% in 2020 compared to 5.85% in 2019.
A further discussion of our borrowing and related interest cost is presented in the “Liquidity and capital resources” section of
this report beginning on page 34 and in Note 6 to the consolidated financial statements.
28
Other non-operating items, net: Other non-operating items increased $46.0 million from a net income of $12.0 million in
2019 to a net expense of $34.0 million in 2020. This change was comprised of charges incurred in 2020 including a $17.3 million
call premium related to the repayment of our 2023 and 2024 unsecured senior notes; and acceleration of $11.8 million of
previously deferred financing fees associated with early repayment of unsecured senior notes in 2020. In addition, the increase
was driven by the $9.2 million impairment of an equity investment in 2020 and the absence of a $7.3 million gain we recognized
from the acquisition of Justice and Quest in 2019.
Provision for income taxes
We reported pre-tax income of $637.1 million for 2020. The effective tax rate on pre-tax income was 24.2%, which is
comparable to the effective tax rate in 2019 of 23.8%. Further information concerning income tax matters is contained in Note 5
of the consolidated financial statements.
Income from continuing operations
Income from continuing operations and related per share amounts are presented in the table below (in thousands, except per
share amounts):
Income from continuing operations
Per basic share
Per diluted share
2020
482,763
2.20
2.19
$
$
$
Change
69%
67%
67%
2019
286,235
1.32
1.31
$
$
$
Our 2020 earnings per share was higher than 2019 due to the factors discussed above including, most notably, the increase
in political revenue reflecting increased spending on elections, increase in subscription revenue from annual rate increases under
existing and newly renegotiated retransmission agreements, partially offset by a decline of AMS due, in part, to reduced
advertising demand as a result of the COVID-19 pandemic.
29
Operating results non-GAAP information
Presentation of non-GAAP information: We use non-GAAP financial performance measures to supplement the financial
information presented on a GAAP basis. These non-GAAP financial measures should not be considered in isolation from, or as
a substitute for, the related GAAP measures, nor should they be considered superior to the related GAAP measures, and
should be read together with financial information presented on a GAAP basis. Also, our non-GAAP measures may not be
comparable to similarly titled measures of other companies.
Management and our Board of Directors use the non-GAAP financial measures for purposes of evaluating company
performance. Furthermore, the Leadership Development and Compensation Committee of our Board of Directors uses non-
GAAP measures such as Adjusted EBITDA, non-GAAP net income, non-GAAP EPS, and free cash flow to evaluate
management’s performance. Therefore, we believe that each of the non-GAAP measures presented provides useful information
to investors and other stakeholders by allowing them to view our business through the eyes of management and our Board of
Directors, facilitating comparisons of results across historical periods and focus on the underlying ongoing operating
performance of our business. We also believe these non-GAAP measures are frequently used by investors, securities analysts
and other interested parties in their evaluation of our business and other companies in the broadcast industry.
We discuss in this Form 10-K non-GAAP financial performance measures that exclude from our reported GAAP results the
impact of “special items” which are described in detail below in the section titled “Discussion of special charges and credits
affecting reporting results”. We believe that such expenses and gains are not indicative of normal, ongoing operations. While
these items may be recurring in nature and should not be disregarded in evaluation of our earnings performance, it is useful to
exclude such items when analyzing current results and trends compared to other periods as these items can vary significantly
from period to period depending on specific underlying transactions or events that may occur. Therefore, while we may incur or
recognize these types of expenses, charges and gains in the future, we believe that removing these items for purposes of
calculating the non-GAAP financial measures provides investors with a more focused presentation of our ongoing operating
performance.
We discuss Adjusted EBITDA (with and without corporate expenses), a non-GAAP financial performance measure that we
believe offers a useful view of the overall operation of our businesses. We define Adjusted EBITDA as net income attributable to
TEGNA before (1) net loss attributable to redeemable noncontrolling interest, (2) income taxes, (3) interest expense, (4) equity
income in unconsolidated investments, net, (5) other non-operating items, net, (6) workforce restructuring expense, (7) M&A
due diligence costs, (8) acquisition-related costs, (9) advisory fees related to activism defense, (10) spectrum repacking
reimbursements and other, net, (11) depreciation and (12) amortization. We believe these adjustments facilitate company-to-
company operating performance comparisons by removing potential differences caused by variations unrelated to operating
performance, such as capital structures (interest expense), income taxes, and the age and book appreciation of property and
equipment (and related depreciation expense). The most directly comparable GAAP financial measure to Adjusted EBITDA is
Net income attributable to TEGNA. Users should consider the limitations of using Adjusted EBITDA, including the fact that this
measure does not provide a complete measure of our operating performance. Adjusted EBITDA is not intended to purport to be
an alternate to net income as a measure of operating performance or to cash flows from operating activities as a measure of
liquidity. In particular, Adjusted EBITDA is not intended to be a measure of cash flow available for management’s discretionary
expenditures, as this measure does not consider certain cash requirements, such as working capital needs, capital
expenditures, contractual commitments, interest payments, tax payments and other debt service requirements.
We also discuss free cash flow, a non-GAAP performance measure that the Board of Directors uses to review the
performance of the business. The most directly comparable GAAP financial measure to free cash flow is Net income attributable
to TEGNA. Free cash flow is calculated as non-GAAP Adjusted EBITDA (as defined above), further adjusted by adding back (1)
stock-based compensation, (2) non-cash 401(k) company match, (3) syndicated programming amortization, (4) pension
reimbursements, (5) dividends received from equity method investments and (6) reimbursements from spectrum repacking.
This is further adjusted by deducting payments made for (1) syndicated programming, (2) pension, (3) interest, (4) taxes (net of
refunds) and (5) purchases of property and equipment. Like Adjusted EBITDA, free cash flow is not intended to be a measure of
cash flow available for management’s discretionary use.
30
Discussion of special charges and credits affecting reported results: Our results during 2020 and 2019 included the
following items we consider “special items” that while at times recurring, can vary significantly from period to period:
Results for the year ended December 31, 2020:
• Workforce restructuring expense which included payroll and related benefit costs at our stations (including the shutdown of
our TMS Phoenix operations) and corporate headquarters;
• M&A due diligence costs we incurred to assist prospective buyers of our company with their due diligence;
• Advisory fees related to activism defense;
• Spectrum repacking reimbursements and other, net consists of gains due to reimbursements from the FCC for required
spectrum repacking, partially offset by an intangible asset impairment charge due to the retirement of a brand name and an
FCC license impairment charge related to a radio station;
• Gains recognized in our equity income in unconsolidated investments, primarily related to our share of CareerBuilder’s gain
on the sale of certain subsidiary businesses;
• Other non-operating items primarily related to costs incurred in connection with the early extinguishment of debt, and an
impairment from one of our investments; and
• Deferred tax benefits related to partial capital loss valuation allowance release.
Results for the year ended December 31, 2019:
• Workforce restructuring expense which included payroll and related benefit costs at our stations and corporate
headquarters;
• Acquisition-related costs which primarily included advisory fees associated with business acquisitions;
• Advisory fees related to activism defense;
• Spectrum repacking reimbursements and other, net was comprised of gains due to reimbursements from the FCC for
required spectrum repacking, non-cash charges to reduce the value of certain assets classified as held-for-sale, gains
recognized on the sale of real estate, and a contract termination and incremental transition costs related to bringing our
national sales organization in-house;
• Gains recognized in our equity income in unconsolidated investments as a result of the sale of two investments;
• Other non-operating items primarily related to a gain for the remeasurement of our previously held ownership in Justice
Network and Quest to fair value, a charitable donation made to the TEGNA Foundation, costs incurred in connection with the
early extinguishment of debt, and a gain due to an observable price increase in an equity investment; and
• Realization of discrete tax benefits related to one of the recent acquisitions and a previously-disposed business.
31
Below are reconciliations of certain line items impacted by special items to the most directly comparable financial measure
calculated and presented in accordance with GAAP on our Consolidated Statements of Income (in thousands, except per share
amounts):
Year ended Dec. 31, 2020
GAAP
measure
Workforce
restructuring
expense
M&A due
diligence
costs
Advisory
fees related
to activism
defense
Spectrum
repacking
reimbursements
and other
Gains on
equity
method
investment
Other
non-
operating
items
Special
tax
items
Non-GAAP
measure
Cost of revenues
$ 1,503,287 $
(595) $
— $
— $
— $
— $
— $ — $ 1,502,692
Special Items
365,601
(372)
—
—
73,295
(54)
(4,588)
(23,087)
Operating expenses
2,066,798
Operating income
870,982
(9,955)
—
(1,021)
1,021
—
—
(4,588)
(23,087)
4,588
23,087
10,397
(34,029)
(233,926)
637,056
154,293
—
—
—
—
—
—
—
—
—
1,021
256
4,588
1,151
23,087
5,801
Business units - Selling,
general and administrative
expenses
Corporate - General and
administrative expenses
Spectrum repacking
reimbursements and other,
net
Equity income (loss) in
unconsolidated
investments, net
Other non-operating items,
net
Total non-operating
expenses
Income before income taxes
Provision for income taxes
Net income attributable to
TEGNA Inc.
Net income per share -
diluted
—
—
9,955
9,955
(9,955)
—
—
—
(9,955)
(2,646)
—
—
—
—
—
(22,606)
—
—
—
—
—
—
—
38,319
(22,606)
(22,606)
38,319
38,319
—
—
—
—
—
—
—
—
—
(5,703)
7,357
3,944
365,229
45,566
—
2,048,057
889,723
(12,209)
4,290
(218,213)
671,510
164,453
482,778
765
3,437
17,286
(7,309)
(16,903)
30,962
(3,944)
507,072
$
2.19 $
— $
0.02 $
0.08 $
(0.03) $
(0.08) $
0.14 $ (0.02) $
2.30
Year ended Dec. 31, 2019
GAAP
measure
Workforce
restructuring
expense
Acquisition
-related
costs
Advisory
fees related
to activism
defense
Spectrum
repacking
reimbursements
and other
Gains on
equity
method
investments
Other
non-
operating
items
Special
tax
items
Non-GAAP
measure
Cost of revenues
$ 1,228,237 $
(4,651) $
— $
— $
— $
— $
— $ — $ 1,223,586
Special Items
Business units - Selling,
general and administrative
expenses
Corporate - General and
administrative expenses
Spectrum repacking
reimbursements and other,
net
326,804
(1,490)
—
—
80,144
(223)
(30,756)
(6,080)
(5,335)
—
—
Operating expenses
1,740,479
(6,364)
(30,756)
Operating income
559,018
6,364
30,756
Equity income (loss) in
unconsolidated
investments, net
Other non-operating items,
net
Total non-operating
expenses
10,149
11,960
(183,361)
—
—
—
—
—
—
—
(6,080)
6,080
—
—
—
Income before income taxes
375,657
Provision for income taxes
89,422
6,364
1,596
30,756
6,249
6,080
1,472
—
—
5,335
5,335
(5,335)
—
—
—
(5,335)
(1,311)
—
—
—
—
—
(13,126)
—
—
—
—
—
—
—
(8,891)
(13,126)
(13,126)
(8,891)
(8,891)
—
—
—
—
—
—
—
—
—
325,314
43,085
—
1,702,614
596,883
(2,977)
3,069
(205,378)
391,505
(3,169)
(2,230)
(568)
91,461
Net income attributable to
TEGNA Inc.
286,235
4,768
24,507
4,608
(4,024)
(9,957)
(6,661)
568
300,044
Net income per share -
diluted (a)
(a) Per share amounts do not sum due to rounding.
1.31 $
$
0.02 $
0.11 $
0.02 $
(0.02) $
(0.05) $
(0.03) $ — $
1.38
32
Non-GAAP consolidated results
The following is a comparison of our as adjusted non-GAAP financial results between 2020 and 2019. Changes between the
periods are driven by the same factors summarized above in the “Results of Operations” section within Management’s
Discussion and Analysis of Financial Condition and Results of Operations (in thousands, except per share amounts).
Adjusted operating expenses
Adjusted operating income
Adjusted equity loss in unconsolidated investments, net
Adjusted other non-operating income
Adjusted total non-operating (expense)
Adjusted income before income taxes
Adjusted provision for income taxes
Adjusted net income attributable to TEGNA Inc.
Adjusted net income per share - diluted
Adjusted EBITDA - Non-GAAP
2020
Change
2019
$
2,048,057
889,723
(12,209)
4,290
(218,213)
671,510
164,453
507,072
$
2.30
20%
49%
***
40%
6%
72%
80%
69%
67%
$
1,702,614
596,883
(2,977)
3,069
(205,378)
391,505
91,461
300,044
$
1.38
Reconciliations of Adjusted EBITDA (inclusive and exclusive of Corporate expenses) to net income from continuing
operations presented in accordance with GAAP on our Consolidated Statements of Income is presented below (in thousands):
Net income attributable to TEGNA Inc. (GAAP basis)
Less: Net loss attributable to redeemable noncontrolling interest
Plus: Provision for income taxes
Plus: Interest expense
Less: Equity income in unconsolidated investments, net
Plus (Less): Other non-operating items, net
Operating income (GAAP basis)
Plus: Workforce restructuring expense
Plus: M&A due diligence and acquisition-related costs
Plus: Advisory fees related to activism defense
Less: Spectrum repacking reimbursements and other, net
Adjusted operating income (non-GAAP basis)
Plus: Depreciation
Plus: Amortization of intangible assets
Adjusted EBITDA (non-GAAP basis)
Corporate - General and administrative expense (non-GAAP basis)
Adjusted EBITDA, excluding Corporate (non-GAAP basis)
*** Not meaningful
2020
Change
2019
$
$
$
$
$
482,778
(15)
154,293
210,294
(10,397)
34,029
870,982
1,021
4,588
23,087
(9,955)
889,723
66,880
67,690
1,024,293
45,566
1,069,859
69%
***
73%
2%
2%
***
56%
(84%)
(85%)
***
87%
49%
10%
35%
45%
6%
43%
$
$
$
$
$
286,235
—
89,422
205,470
(10,149)
(11,960)
559,018
6,364
30,756
6,080
(5,335)
596,883
60,525
50,104
707,512
43,085
750,597
Adjusted EBITDA margin was 36% (without corporate expense) and 35% including corporate. Our total Adjusted EBITDA
increased $316.8 million or 45% in 2020 compared to 2019. Our 2019 Acquisitions added $111.5 million of Adjusted EBITDA.
Excluding the 2019 Acquisitions, Adjusted EBITDA increased by $205.3 million. This increase was primarily driven by the
operational factors discussed above within the revenue and operating expense fluctuation explanation sections, most notably,
the increase in political revenue in 2020.
Free cash flow reconciliation
Our free cash flow, a non-GAAP performance measure, was $741.1 million for the year ended December 31, 2020,
compared to $376.2 million for the same period in 2019. Our free cash flow in 2020 was higher compared to 2019 primarily due
to higher EBITDA and lower capital expenditures.
33
Reconciliations from “Net income attributable to TEGNA Inc.” to “Free cash flow” are presented below (in thousands):
Net Income attributable to TEGNA Inc. (GAAP basis)
Plus: Provision for income taxes
Plus: Interest expense
Plus: M&A due diligence and acquisition-related costs
Plus: Depreciation
Plus: Amortization
Plus: Stock-based compensation
Plus: Company stock 401(k) contribution
Plus: Syndicated programming amortization
Plus: Workforce restructuring expense
Plus: Advisory fees related to activism defense
Plus: Cash dividend from equity investments for return on capital
Plus: Cash reimbursements from spectrum repacking
Plus (Less): Other non-operating items, net
Less: Net loss attributable to redeemable noncontrolling interest
Less: Tax payments, net of refunds
Less: Spectrum repacking reimbursement and other, net
Less: Equity income in unconsolidated investments, net
Less: Syndicated programming payments
Less: Pension contributions
Less: Interest payments
Less: Purchases of property and equipment
Free cash flow (non-GAAP basis)
FINANCIAL POSITION
Liquidity and capital resources
2020
2019
482,778 $
154,293
210,294
4,588
66,880
67,690
20,306
16,469
71,078
1,021
23,087
6,373
13,180
34,029
(15)
(84,889)
(9,955)
(10,397)
(74,279)
(5,133)
(200,766)
(45,499)
741,133 $
286,235
89,422
205,470
30,756
60,525
50,104
20,146
9,558
60,757
6,364
6,080
1,325
16,974
(11,960)
—
(84,045)
(5,335)
(10,149)
(58,436)
(23,101)
(186,086)
(88,356)
376,248
$
$
Our operations have historically generated strong positive operating cash flow which, along with availability under our
existing revolving credit facility as well as cash and cash equivalents on hand, have been sufficient to fund our capital
expenditures, interest expense, dividends, investments in strategic initiatives (including acquisitions) and other operating
requirements.
The COVID-19 pandemic has had far-reaching material adverse impacts on many aspects of our operations, directly and
indirectly, including our employees, consumer behavior, distribution of our content, our vendors, and the overall market. In light
of the uncertain situation relating to the COVID-19 pandemic, we took a number of precautionary measures to mitigate the
financial impact of the pandemic, and minimize the resultant risks to our company, employees, our shareholders, customers,
and the communities in which we serve. Such steps included the following:
• Refinanced $538.0 million of debt with maturities in 2021 or 2024 to 2026;
• Amended our revolving credit facility on June 11, 2020 to extend the initial step-down of the maximum permitted
total leverage ratio by 15 months. Under the amendment our maximum leverage ratio covenant will remain at 5.50x
until the fiscal quarter ending March 31, 2022;
• Implemented temporary company-wide one-week furlough program of our workforce during the second quarter of
2020;
• Announced temporary pay reductions of 8% for certain key newsroom personnel, 20% for general managers and all
corporate executive and senior vice presidents, and 25% for our CEO and Board of Directors during the second
quarter of 2020, in lieu of the one week furlough;
• Reduced and/or deferred capital expenditures and non-critical operating expenses; and
• Implemented travel bans and restrictions.
During 2020 several pieces of legislation were enacted in response to COVID-19. The most impactful to TEGNA was the
Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) on March 27, 2020. The CARES Act provided numerous
tax provisions and other stimulus measures. We benefited from the CARES Act as a result of lower 2020 tax payments of
approximately $5 million from the provisions that allow for (1) immediate deduction of any eligible leasehold improvements
placed in service during 2018 and 2019, and (2) temporary relaxation of net interest deduction limitations which will allow us to
34
immediately deduct 2019 interest expense that would otherwise have been disallowed and carried forward to future periods. We
also elected to defer the employer portion of the social security payroll tax (6.2%) as outlined within the CARES Act. The
deferral was effective from March 27, 2020 through December 31, 2020. This produced a cash flow benefit of approximately
$20 million in 2020. The deferred amount will be paid in two installments and the amount will be considered timely paid if 50%
of the deferred amount is paid by December 31, 2021 and the remainder by December 31, 2022.
As we summarize in the Long-term debt section below, during 2020 we completed several strategic actions which have
positioned us to continue to pursue strategic acquisition opportunities that may develop in our sector, invest in new content and
revenue initiatives, and grow revenue in fiscal year 2021. Over the longer term, we expect to continue to fund debt maturities,
acquisitions and investments through a combination of cash flows from operations, borrowings under our revolving credit facility
and funds raised in the capital markets.
Since 2017, we have been paying a regular quarterly cash dividend of $0.07 per share. We paid dividends totaling $76.5
million in 2020 and $60.6 million in 2019. We expect to continue paying comparable regular cash dividends in the future. The
rate and frequency of future dividends will depend on future earnings, capital requirements and financial condition and other
factors considered relevant by our Board of Directors.
As of December 31, 2020, we were in compliance with all covenants contained in our debt agreements and credit facility and
our leverage ratio, calculated in accordance with our revolving credit agreement and term loan agreements, was 3.86x, well
below the permitted leverage ratio of less than 5.50x. The leverage ratio is calculated using annualized adjusted EBITDA (as
defined in the agreement) for the trailing eight quarters. We believe that we will remain compliant with all covenants for the
foreseeable future. Our financial and operating performance, as well as our ability to generate sufficient cash flow to maintain
compliance with credit facility covenants, are subject to certain risk factors; see Item 1A. “Risk Factors” for further discussion.
Contractual obligations
An important use of our liquidity pertains to purchasing programming rights. Most of our stations have network affiliations
agreements with major broadcast networks (ABC, CBS, NBC, and Fox). Under these agreements the television networks
produce and distribute programming to us in exchange for our stations commitments to air the programming at specified times
and to pay the networks compensation at fixed or variable rates (such as a rate per number of MVPD subscribers accessing the
programming). The network affiliation agreements generally have a three-year term. In addition, programming commitments
include acquired syndicated programming (television series and movies that are purchased on a group basis for use by our
owned stations). These contracts typically cover a period of up to five years, with payments typically made over several years.
As of December 31, 2020, we had total programming commitments of $2.20 billion, of which $810.0 million will be settled within
the next twelve months. See Note 12 to the consolidated financial statements for further details regarding programming
commitments.
We also secure our on-air talent and other key personnel at our television stations through multi-year talent and employment
agreements. We expect our contracts for talent and other key personnel will be renewed or replaced with similar agreements
upon their expiration. As of December 31, 2020, amounts due under these contracts were approximately $201.8 million, of
which approximately $121.3 million will be paid within the next twelve months.
Other material contractual obligations include our operating leases (see Note 8 to the consolidated financial statements for
further details) as well as our long-term debt and interest payments (see ‘Long-term debt’ section below, as well as Note 6 to the
consolidated financial statements for further details).
35
The following table provides a summary of our cash flow information for the three years ended December 31, 2020 followed
by a discussion of the key elements of our cash flows (in thousands):
2020
2019
2018
Cash, cash equivalents and restricted cash at beginning of year
$
29,404 $
135,862 $
128,041
Operating activities:
Net income
Non-cash adjustments
Changes in working capital
Changes in other assets and liabilities
Net cash flows from operating activities
Investing activities:
Payments for acquisitions of businesses, net of cash acquired
All other investing activities
Net cash used for investing activities
Financing activities:
482,763
202,189
102,198
17,986
805,136
286,235
156,858
(123,048)
(22,572)
297,473
405,665
108,955
47,799
(35,210)
527,209
(34,841)
(24,680)
(59,521)
(1,514,183)
(49,287)
(1,563,470)
(328,433)
(45,983)
(374,416)
(Payment of) proceeds from borrowings under revolving credit facility, net
Proceeds from borrowings
Debt repayments
Dividends paid
All other financing activities
Net cash (used for) provided by financing activities
(548,000)
1,550,000
(1,623,000)
(76,465)
(36,586)
(734,051)
853,000
1,100,000
(710,000)
(60,624)
(22,837)
1,159,539
50,000
—
(121,146)
(60,290)
(13,536)
(144,972)
Net change in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at end of year
11,564
40,968 $
(106,458)
29,404 $
7,821
135,862
$
Operating Activities
Cash flow from operating activities was $805.1 million in 2020, compared to $297.5 million in 2019. This $507.6 million
increase was primarily driven by the $407.1 million increase in political revenue in 2020. As political advertisements are typically
paid upfront, they provide an immediate benefit to operating cash flow as compared to non-political advertising which is billed
and collected in arrears after the advertisement has been delivered. Also contributing to the increase was a favorable change in
accounts receivable of $113.7 million due to increases in cash collection on AMS. These increases were partially offset by an
increase in interest payments of $14.7 million.
Investing Activities
Cash flow used for investing activities was $59.5 million in 2020, compared to $1.56 billion in 2019. The decrease of $1.50
billion was primary due to $34.8 million being spent on acquisitions in 2020 as compared to cash used in 2019 of $1.51 billion
for the acquisitions of the Gray Stations, Justice and Quest multicast networks, Dispatch stations, and Nexstar stations.
Financing Activities
Cash flow used for financing activities was $734.1 million in 2020, compared to cash provided by financing of $1.16 billion in
2019. The change was primarily due to debt activity. Specifically, in January 2020 we issued $1.0 billion of senior unsecured
notes, the proceeds of which were used to early redeem $650.0 million of senior unsecured notes due in October 2023 and
$310.0 million due in July 2020. Additionally, in September 2020 we issued $550 million of senior unsecured notes. In October
2020 we repaid the entire $350 million aggregate principal amount of our 4.875% senior unsecured notes due in 2021 and $188
million aggregate principal amount of our 5.500% senior unsecured notes due in 2024.
In 2019, we issued $1.1 billion of senior unsecured notes, the proceeds of which were used to finance a portion of the
acquisition of the Nexstar Stations, and along with borrowing under the revolving credit facility, to repay the remaining $320
million of notes due in October 2019 and early repay $290 million of our $600 million senior unsecured notes due in July 2020.
We also paid down $548.0 million on our revolving credit facility in 2020 as compared to borrowing $853.0 million in 2019.
36
For a comparative discussion of changes in our cash flow comparing the years ended December 31, 2019 and December
31, 2018, see “Part II, Item 7. Financial Position” of our annual report on Form 10-K for the year ended December 31, 2019,
filed with the SEC on March 2, 2020.
Long-term debt
As of December 31, 2020, our total principal debt outstanding was $3.58 billion, cash and cash equivalents totaled $41.0
million, and we had unused borrowing capacity of $1.13 billion under our revolving credit facility, which is our primary source for
funding short-term cash requirements. As of December 31, 2020, approximately $3.23 billion, or 90%, of our debt had a fixed
interest rate. See “Note 6 Long-term debt” to our consolidated financial statements for a table summarizing the components of
our long-term debt.
On January 9, 2020 we issued $1.0 billion aggregate principal amount of senior unsecured notes bearing an interest rate of
4.625% which are due in March 2028. These senior notes, as well as those issued in September 2019, include customary
market covenants and call provisions consistent with our past issuances. On February 11, 2020 we used the net proceeds to
repay the remaining $310 million principal amount of our 5.125% Senior Notes due 2020, the $650 million principal amount of
our 6.375% Senior Notes due 2023, a $13.8 million call premium on our 6.375% Senior Notes due 2023 and borrowings under
our revolving credit facility.
On September 10, 2020, we issued $550 million aggregate principal amount of senior unsecured notes bearing an interest
rate of 4.750% which are due in March 2026. The proceeds were used to reduce borrowings from our revolving credit facility.
On October 13, 2020 we utilized our revolving credit facility to repay the entire $350 million aggregate principal amount of
our 4.875% Senior Notes due in 2021 and $188 million aggregate principal amount of our 5.500% Senior Notes due in 2024
and a $3.4 million redemption premium on our Senior Notes due in 2024.
We expect our existing cash and cash equivalents, cash flow from our operations and borrowing capacity under the
revolving credit facility will be sufficient to satisfy our debt service obligations, capital expenditure requirements, and working
capital needs for the next twelve months. Our interest payments and debt maturities may be repaid with cash flow from
operating activities, accessing capital markets or a combination of both. Interest payments on the senior notes are based on the
stated cash coupon rate. As of December 31, 2020, we had future interest payments on our senior notes of $1.19 billion, of
which $167.8 million will be paid within the next twelve months. We also had $355.0 million of outstanding borrowings under our
revolving credit facility as of December 31, 2020. Future interest payments on the revolving credit facility are not known with
certainty as payments into and out of the credit facility can change daily and interest payments are based variable interest rates.
For illustrative purposes, assuming the December 31, 2020 revolving credit facility balance does not change during 2021 and
rates remain at the same level as those existing as of December 31, 2020, we estimate interest payments in 2021 will be
approximately $9.6 million.
The following schedule discloses future annual maturities of the principal amount of total debt due (in thousands):
Repayment schedule of principal long-term debt as of Dec. 31, 2020
2021
2022
2023
2024 (1)
2025
Thereafter
Total
$
—
—
—
492,000
—
3,090,000
$
3,582,000
(1) Assumes the current revolving credit facility borrowings come due in 2024 and the revolving credit facility is not extended.
Off-Balance Sheet Arrangements
Off-balance sheet arrangements as defined by the Securities and Exchange Commission include the following four
categories: obligations under certain guarantee contracts; retained or contingent interests in assets transferred to an
unconsolidated entity or similar arrangements that serve as credit, liquidity or market risk support; obligations under certain
derivative arrangements classified as equity; and obligations under material variable interests. As of December 31, 2020, we
had no material off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on
our consolidated financial condition, results of operations, liquidity, capital expenditures or capital resources.
37
Capital stock
In December 2020, our Board of Directors authorized a new share repurchase program for up to $300.0 million of our
common stock over the next three years. The shares may be repurchased at management’s discretion, either in the open
market or in privately negotiated block transactions. Management’s decision to repurchase shares will depend on price and
other corporate developments. Purchases may occur from time to time and no maximum purchase price has been set. The
program was previously suspended on March 20, 2019 simultaneously with the announcement of our acquisition of the Nexstar-
Tribune divestiture stations to prioritize use of cash for debt repayment associated with those acquisitions. In 2018,
approximately 545,000 shares were purchased for $5.8 million. Certain of the shares we previously acquired have been
reissued in settlement of employee stock awards.
The renewal of the share repurchase program demonstrates the Board’s and management’s confidence in the business and
continued focus on making prudent, disciplined decisions intended to drive near and long-term shareholder value. Our capital
allocation decisions focus on optimizing investments in organic and inorganic growth opportunities, paying down debt, issuing
dividends, and repurchasing shares.
Our common stock outstanding as of December 31, 2020, totaled 219,500,272 shares, compared with 217,463,550 shares
as of December 31, 2019.
Critical accounting policies and the use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to
make estimates and assumptions about future events that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ significantly from those estimates. We believe the following discussion
addresses our most critical accounting policies, which are those that are material to the presentation of our financial condition
and results of operations and require management’s most subjective and complex judgments. This commentary should be read
in conjunction with our consolidated financial statements and the remainder of this Form 10-K.
Goodwill: As of December 31, 2020, our goodwill balance was $3.0 billion and represented approximately 43% of our total
assets. Goodwill represents the excess of acquisition cost over the fair value of assets acquired, including identifiable intangible
assets, net of liabilities assumed.
Goodwill is tested for impairment at a level referred to as the reporting unit. A reporting unit is a business for which discrete
financial information is available and segment management regularly reviews the operating results. The level at which we test
goodwill for impairment requires us to determine whether the operations below the operating segment level constitute a
reporting unit. We have determined that our one segment, Media, consists of a single reporting unit.
Goodwill is tested for impairment on an annual basis (first day of our fourth quarter) or between annual tests if events or
changes in circumstances occurred that indicate the fair value of a reporting unit may be below its carrying amount.
Before performing the annual goodwill impairment test quantitatively, we first have the option to perform a qualitative
assessment to determine if the quantitative test must be completed. The qualitative assessment considers events and
circumstances such as macroeconomic conditions, industry and market conditions, cost factors and overall financial
performance, as well as company and specific reporting unit specifications. If after performing this assessment, we conclude it
is more likely than not that the fair value of a reporting unit is less than its carrying amount, then we are required to perform the
quantitative test. Otherwise, the quantitative test is not required. In 2020, we elected not to perform the optional qualitative
assessment of goodwill and instead performed the quantitative impairment test.
When performing the quantitative test, we determine the fair value of the reporting unit and compare it to the carrying
amount, including goodwill. If the carrying amount of the reporting unit exceeds the fair value of the reporting unit, the reporting
unit’s goodwill is impaired and we recognize an impairment loss equal to the difference between the reporting unit’s carrying
amount and fair value.
We estimate the fair value of our one reporting unit based on a market-based valuation methodology, which is primarily
based on our consolidated market capitalization plus a control premium. In the fourth quarter of 2020, we completed our annual
goodwill impairment test for our reporting unit. The results of the test indicated that the estimated fair value of our reporting unit
significantly exceeded the carrying value. We do not believe that the reporting unit is currently at risk of incurring a goodwill
impairment in the foreseeable future.
Impairment assessment inherently involves management judgments regarding the assumptions described above. Fair value
of the reporting unit also depends on the future strength of the economy in our principal media markets. New and developing
competition as well as technological change could also adversely affect our stock price and future fair value estimates.
38
Indefinite Lived Intangibles: Consist entirely of FCC broadcast licenses related to our acquisitions of television stations. As
of December 31, 2020, indefinite lived intangible assets were $2.1 billion and represented approximately 31% of our total
assets.
The FCC broadcast licenses are recorded at their estimated fair value as of the date of the business acquisition. We
determine the fair value of each FCC broadcast license using an income approach referred to as the Greenfield method. The
Greenfield method utilizes a discounted cash flow model that incorporates several key assumptions, including market revenues,
long-term growth projections, estimated market share for a typical market participant, estimated profit margins based on market
size and station type, and a discount rate (determined using a weighted average cost of capital). Since these licenses are
considered indefinite lived intangible assets we do not amortize them, rather they are tested for impairment annually (on the first
day of our fourth quarter), or more often if circumstances dictate, for impairment and written down to fair value as required.
We have the option to first perform a qualitative assessment to determine if it is more likely than not that the fair value of the
indefinite lived asset is more than its carrying amount. If that is the case, then we do not need to perform the quantitative
analysis. The qualitative assessment considers trends in macroeconomic conditions, industry and market conditions, cost
factors and overall financial performance of the indefinite lived asset. In 2020, we elected to perform the quantitative
assessment for FCC licenses acquired in the 2018 KFMB acquisition as well as those acquired in our 2019 acquisitions, which
represented an aggregate carrying value of $897.7 million. These licenses have more limited headroom due to the fact that we
recently recorded them at fair value upon their respective acquisition. To estimate the fair values for this subset of our FCC
broadcast licenses, we applied an income approach, using the Greenfield method. The results of our 2020 annual impairment
test of FCC broadcast licenses indicated the fair value of a radio license was less than its carrying amount; and therefore, a
$1.1 million impairment charge was recorded. No other impairments occurred in 2020.
We performed the optional qualitative assessment for all of our other FCC licenses, which represented an aggregate
carrying value of $1.23 billion. In performing the qualitative impairment analysis, we analyzed trends in the significant inputs
used in the fair value determination of the FCC license assets. This included reviewing trends in market revenues, market
share, profit margins, long-term expected growth rates, and changes in the discount rate. The results of our qualitative
procedures showed no material adverse change in inputs that would indicate an impairment exists since the last quantitative
test of these assets. As such, we concluded it was more likely than not that the fair value of these indefinite lived FCC broadcast
licenses was more than their carrying amounts. Therefore, we did not perform a quantitative test on these FCC licenses in
2020.
The quantitative and qualitative analysis performed included projected estimated economic impacts from the COVID-19
pandemic. A sustained economic decline resulting from COVID-19 larger than what was projected in our analysis could result in
future non-cash impairment charges of our recently acquired FCC licenses, and any related impairment could have a material
adverse impact on our results of operations. In particular, one recently acquired TV station and one radio station have FCC
licenses, that have a combined carrying value of $67.2 million and have individual headroom of less than 5%, and therefore, are
at a heightened risk of future impairment. Changes in key fair value assumptions that could result in a future impairment charge
include increases in discount rates and declines in market revenues. A 100 basis point increase in our discount rate or a 10%
decline in market revenues (holding all other assumptions in the fair value model constant) would result in an aggregate
impairment charge of these FCC licenses of less than approximately $8.0 million.
Pension Liabilities: Certain employees participate in qualified and non-qualified defined benefit pension plans (see Note 7
to consolidated financial statements). Our principal defined benefit pension plan is the TEGNA Retirement Plan (TRP). We also
sponsor the TEGNA Supplemental Retirement Plan (SERP) for certain employees. Substantially all participants in the TRP and
SERP had their benefits frozen before 2009, and in December 2017, we froze all remaining accruing benefits for certain
grandfathered SERP participants.
We recognize the net funded status of these postretirement benefit plans as a liability on our Consolidated Balance Sheets.
There is a corresponding non-cash adjustment to accumulated other comprehensive loss, net of tax benefits recorded as
deferred tax assets, in stockholders’ equity. The funded status represents the difference between the fair value of each plan’s
assets and the benefit obligation of the plan. The benefit obligation represents the present value of the estimated future benefits
we currently expect to pay to plan participants based on past service.
The plan assets and benefit obligations are measured as of December 31 of each year, or more frequently, upon the
occurrence of certain events such as a plan amendment, settlement, or curtailment. The amounts we record are measured
using actuarial valuations, which are dependent upon key assumptions such as discount rates, participant mortality rates and
the expected long-term rate of return on plan assets. The assumptions we make affect both the calculation of the benefit
obligations as of the measurement date and the calculation of net periodic pension expense in subsequent periods. When
reassessing these assumptions we consider past and current market conditions and make judgments about future market
trends. We also consider factors such as the timing and amounts of expected contributions to the plans and benefit payments to
plan participants.
The most important assumptions include the discount rate applied to pension plan obligations and the expected long-term
rate of return on plan assets related for the TRP (the SERP is an unfunded plan). The discount rate assumption is based on
39
investment yields available at year-end on corporate bonds rated AA and above with a maturity to match the expected benefit
payment stream. A decrease in discount rates would increase pension obligations.
We establish the expected long-term rate of return by developing a forward-looking, long-term return assumption for each
pension fund asset class, taking into account factors such as the expected real return for the specific asset class and inflation. A
single, long-term rate of return is then calculated as the weighted average of the target asset allocation percentages and the
long-term return assumption for each asset class. We apply the expected long-term rate of return to the fair value of its pension
assets in determining the dollar amount of its expected return. Changes in the expected long-term return on plan assets would
increase or decrease pension plan expense. For 2020, we assumed a rate of 6.75% for our long-term expected return on
pension assets used for our TRP plan. As an indication of the sensitivity of pension expense to the long-term rate of return
assumption, a plus or minus 50 basis points change in the expected rate of return on pension assets (with all other assumptions
held constant) would have decreased or increased estimated pension plan expense for 2020 by approximately $2.3 million. The
effects of actual results differing from these assumptions are accumulated as unamortized gains and losses.
For the December 31, 2020 measurement, the assumption used for the discount rate was 2.55% for our principal retirement
plan. As an indication of the sensitivity of pension liabilities to the discount rate assumption, a plus or minus 50 basis points
change in the discount rate as of the end of 2020 (with all other assumptions held constant) would have decreased or increased
plan obligations by approximately $31.2 million. For 2020, the discount rate used to determine the pension expense was 3.30%.
A 50 basis points increase or decrease in this discount rate would have decreased or increased total pension plan expense for
2020 by approximately $0.6 million.
Income Taxes: Our annual tax rate is based on our income, statutory tax rates, and tax planning opportunities available in
the various jurisdictions in which we operate. Significant judgment is required in determining our annual tax expense and in
evaluating our tax positions.
Tax law requires certain items to be included in our tax returns at different times than when the items are reflected in the
financial statements. The annual tax expense reflected in the Consolidated Statements of Income is different than that reported
in our tax returns. Some of these differences are permanent (for example, expenses recorded for accounting purposes that are
not deductible in the returns such as certain entertainment expenses) and some differences are temporary and reverse over
time, such as depreciation expense. Temporary differences create deferred tax assets and liabilities. Deferred tax liabilities
generally represent tax expense recognized in the financial statements for which payment has been deferred, or expense for
which a deduction has been taken already in the tax return but the expense has not yet been recognized in the financial
statements. Deferred tax assets generally represent items that can be used as a tax deduction or credit in tax returns in future
years for which a benefit has already been recorded in the financial statements, as well as tax losses that can be carried over
and used in future years. Valuation allowances are established when necessary to reduce deferred income tax assets to the
amounts we believe are more likely than not to be recovered. In evaluating the amount of any such valuation allowance, we
consider the existence of cumulative income or losses in recent years, the reversal of existing temporary differences, the
existence of taxable income in prior carry back years, available tax planning strategies and estimates of future taxable income
for each of our taxable jurisdictions. The latter two factors involve the exercise of significant judgment. As of December 31,
2020, deferred tax asset valuation allowances totaled $43.5 million, primarily related to federal and state capital losses, minority
investments, state interest disallowance carryovers, and state net operating losses available for carry forward to future years.
Although realization is not assured, we believe it is more likely than not that all other deferred tax assets for which no valuation
allowances have been established will be realized. This conclusion is based on our history of cumulative income in recent years
and review of historical and projected future taxable income.
We determine whether it is more likely than not that a tax position will be sustained upon examination by the appropriate
taxing authorities before any part of the benefit is recorded in our financial statements. A tax position is measured as the portion
of the tax benefit that is greater than 50% likely to be realized upon settlement with a taxing authority (that has full knowledge of
all relevant information). We may be required to change our provision for income taxes when the ultimate treatment of certain
items is challenged or agreed to by taxing authorities, when estimates used in determining valuation allowances on deferred tax
assets significantly change, or when receipt of new information indicates the need for adjustment in valuation allowances.
Future events, such as changes in tax laws, tax regulations, or interpretations of such laws or regulations, could have an impact
on the provision for income tax and the effective tax rate. Any such changes could significantly affect the amounts reported in
the consolidated financial statements in the year these changes occur.
40
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market risk is the potential gain/loss arising from changes in market rates and prices, such as interest rates and changes in
the market value of financial instruments. Our main exposure to market risk relates to interest rates. We had $355 million in
floating interest rate obligations outstanding on December 31, 2020, and therefore are subject to changes in the amount of
interest expense we might incur. A 50 basis point increase or decrease in the average interest rate for these obligations would
result in an increase or decrease in annual interest expense of $1.8 million. Refer to Note 9 to the consolidated financial
statements for information regarding the fair value of our long-term debt.
We believe that our market risk from financial instruments, such as accounts receivable, accounts payable and debt, is not
material.
41
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
FINANCIAL STATEMENTS
Reports of Independent Registered Public Accounting Firms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Balance Sheets as of December 31, 2020 and 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Income for the Years Ended December 31, 2020, 2019 and 2018 . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2020, 2019 and 2018 . . . . . . . . . . . . .
Consolidated Statements of Cash Flows for the Years Ended December 31, 2020, 2019 and 2018 . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Equity and Redeemable Noncontrolling Interest for the Years Ended December 31, 2020, 2019
and 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Page
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48
49
50
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42
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Directors of TEGNA Inc.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of TEGNA Inc. and its subsidiaries (the “Company”) as of
December 31, 2020 and 2019, and the related consolidated statements of income, of comprehensive income, of equity and
redeemable noncontrolling interest and of cash flows for each of the two years in the period ended December 31, 2020, including
the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s
internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated
Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position
of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the two years
in the period ended December 31, 2020 in conformity with accounting principles generally accepted in the United States of
America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting
as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.
Change in Accounting Principle
As discussed in Note 8 to the consolidated financial statements, the Company changed the manner in which it accounts for
leases in 2019.
Basis for Opinions
The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control
over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in
Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. Our responsibility is to express
opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting
based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United
States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities
laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement,
whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material
respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement
of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated
financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control
over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We
believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that
(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions
of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
43
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial
statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or
disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or
complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated
financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate
opinion on the critical audit matter or on the accounts or disclosures to which it relates.
FCC broadcast license impairment assessments -licenses acquired in the KFMB, Gray stations, Dispatch stations, and Nexstar
stations acquisitions
As described in Notes 1 and 3 to the consolidated financial statements, the Company’s consolidated FCC broadcast licenses
balance was $2.1 billion as of December 31, 2020, of which $897.7 million related to FCC broadcast licenses acquired in the
KFMB, Gray stations, Dispatch stations, and Nexstar stations acquisitions, which were subject to a quantitative impairment
assessment. Intangible assets with indefinite lives are tested annually, or more often if circumstances dictate, for impairment and
written down to fair value as required. Fair value is estimated by management using an income approach called the Greenfield
method. The Greenfield method utilizes a discounted cash flow model that incorporates several key assumptions, including
market revenues, long-term growth projections, estimated market share for a typical market participant, estimated profit margins
based on market size and station type, and the discount rate (determined by management using a weighted average cost of
capital).
The principal considerations for our determination that performing procedures relating to the FCC broadcast license impairment
assessments for the licenses acquired in the KFMB, Gray stations, Dispatch stations, and Nexstar stations acquisitions is a
critical audit matter are the significant judgment by management when developing the fair value measurement of the FCC
broadcast licenses. This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and
evaluating management’s significant assumptions related to market revenues, long-term growth projections, estimated market
share for a typical market participant, estimated profit margins based on market size and station type, and the discount rate. In
addition, the audit effort involved the use of professionals with specialized skill and knowledge.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall
opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to
management’s impairment assessments, including controls over the valuation of the Company’s FCC broadcast licenses for the
licenses acquired in the KFMB, Gray stations, Dispatch stations, and Nexstar stations acquisitions. These procedures also
included, among others, (i) testing management’s process for developing the fair value estimates; (ii) evaluating the
appropriateness of the discounted cash flow model; (iii) testing the completeness, accuracy, and relevance of underlying data
used in the model; and (iv) evaluating the significant assumptions used by management related to market revenues, long-term
growth projections, estimated market share for a typical market participant, estimated profit margins based on market size and
station type, and the discount rate. Evaluating management’s assumptions related to market revenues, estimated market share
for a typical market participant and estimated profit margins based on market size and station type involved evaluating whether
the assumptions used by management were reasonable considering (i) the current and past performance in the market being
evaluated, (ii) the consistency with external market and industry data, and (iii) whether these assumptions were consistent with
evidence obtained in other areas of the audit. The discount rate was evaluated by considering the cost of capital of comparable
businesses and other industry factors. Professionals with specialized skill and knowledge were used to assist in the evaluation of
the Company’s discounted cash flow model and the discount rate and long-term growth projections assumptions.
/s/ PricewaterhouseCoopers LLP
Arlington, Virginia
March 1, 2021
We have served as the Company’s auditor since 2018.
44
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Directors of TEGNA Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of income, comprehensive income, shareholders’ equity and cash
flows for the year ended December 31, 2018, and the related notes (collectively referred to as the “consolidated financial
statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the results of operations
and cash flows of TEGNA, Inc. (the Company) for the year ended December 31, 2018, in conformity with U.S. generally
accepted accounting principles.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on
the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company
Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange
Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to
error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statements,
whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a
test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the
accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the
financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ Ernst & Young LLP
We served as the Company’s auditor from 2005 to 2019.
Tysons, Virginia
March 1, 2019
45
TEGNA Inc.
CONSOLIDATED BALANCE SHEETS
In thousands of dollars
ASSETS
Current assets
Cash and cash equivalents
Accounts receivable, net of allowances of $7,035 and $3,723, respectively
Other receivables
Syndicated programming rights
Prepaid expenses and other current assets
Total current assets
Property and equipment
Land
Buildings and improvements
Equipment, furniture and fixtures
Construction in progress
Total
Less accumulated depreciation
Net property and equipment
Intangible and other assets
Goodwill
Indefinite-lived and amortizable intangible assets, less accumulated amortization of $235,582 and
$168,452, respectively
Right-of-use assets for operating leases
Investments and other assets
Total intangible and other assets
Total assets
Dec. 31,
2020
2019
$
40,968 $
550,755
14,031
47,331
19,509
29,404
581,765
19,640
49,616
26,899
672,594
707,324
86,456
329,088
593,517
17,398
1,026,459
86,456
322,961
553,995
34,324
997,736
(556,100)
(512,015)
470,359
485,721
2,968,693
2,950,587
2,503,644
2,561,614
97,190
136,219
103,461
145,269
5,705,746
5,760,931
$
6,848,699 $
6,953,976
46
TEGNA Inc.
CONSOLIDATED BALANCE SHEETS
In thousands of dollars, except par value and share amounts
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND EQUITY
Current liabilities
Accounts payable
Accrued liabilities
Compensation
Interest
Contracts payable for programming rights
Other
Dividends payable
Income taxes payable
Total current liabilities
Noncurrent liabilities
Income taxes
Deferred income tax liability
Long-term debt
Pension liabilities
Operating lease liabilities
Other noncurrent liabilities
Total noncurrent liabilities
Total liabilities
Dec. 31,
2020
2019
$
58,049 $
51,894
46,213
47,249
130,522
78,219
—
63,923
424,175
63,876
46,013
119,872
60,983
15,188
3,332
361,158
7,303
7,490
530,240
515,621
3,553,220
4,179,245
85,908
99,337
75,488
127,146
105,902
67,037
4,351,496
5,002,441
4,775,671
5,363,599
Commitments and contingent liabilities (see Note 12)
Redeemable noncontrolling interest (see Note 12)
$
14,933 $
—
Shareholders’ equity
Common stock of $1 par value per share, 800,000,000 shares authorized, 324,418,632 shares
issued
Additional paid-in capital
Retained earnings
Accumulated other comprehensive loss
Less treasury stock at cost, 104,918,360 shares and 106,955,082 shares, respectively
Total equity
324,419
113,267
324,419
247,497
7,075,640
6,655,088
(121,076)
(5,334,155)
(142,597)
(5,494,030)
2,058,095
1,590,377
Total liabilities, redeemable noncontrolling interest and equity
$
6,848,699 $
6,953,976
The accompanying notes are an integral part of these consolidated financial statements.
47
TEGNA Inc.
CONSOLIDATED STATEMENTS OF INCOME
In thousands of dollars, except per share amounts
Revenues
$ 2,937,780 $ 2,299,497 $ 2,207,282
2020
Dec. 31,
2019
2018
Operating expenses:
Cost of revenues1
Business units - Selling, general and administrative expenses
Corporate - General and administrative expenses
Depreciation
Amortization of intangible assets
Spectrum repacking reimbursements and other, net (see Note 11)
Total
Operating income
Non-operating income (expense):
Equity income in unconsolidated investments, net
Interest expense
Other non-operating items, net
Total
Income before income taxes
Provision for income taxes
Income from continuing operations
Income from discontinued operations, net of tax
Net income
Net loss attributable to redeemable noncontrolling interest
1,503,287 1,228,237 1,065,933
365,601
326,804
315,320
73,295
66,880
67,690
(9,955)
80,144
60,525
50,104
52,467
55,949
30,838
(5,335)
(11,701)
2,066,798 1,740,479 1,508,806
870,982
559,018
698,476
10,397
10,149
13,792
(210,294)
(205,470)
(192,065)
(34,029)
11,960
(11,496)
(233,926)
(183,361)
(189,769)
637,056
375,657
508,707
154,293
89,422
107,367
482,763
286,235
401,340
—
—
4,325
482,763
286,235
405,665
15
—
—
Net income attributable to TEGNA Inc.
$
482,778 $
286,235 $
405,665
Earnings from continuing operations per share - basic
Earnings from discontinued operations per share - basic
Net income per share - basic
Earnings from continuing operations per share - diluted
Earnings from discontinued operations per share - diluted
Net income per share - diluted
$
$
$
$
2.20 $
1.32 $
—
—
2.20 $
1.32 $
2.19 $
1.31 $
—
—
2.19 $
1.31 $
1.86
0.02
1.88
1.85
0.02
1.87
Weighted average number of common shares outstanding:
Basic shares
Diluted shares
219,232
217,138
216,184
219,733
217,977
216,621
1Cost of revenues exclude charges for depreciation and amortization expense, which are shown separately above.
The accompanying notes are an integral part of these consolidated financial statements.
48
TEGNA Inc.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
In thousands of dollars
Net income
Other comprehensive (loss) income, before tax:
Foreign currency translation adjustments
Pension and other post-retirement benefit items:
Recognition of previously deferred post-retirement benefit plan costs
Actuarial gain (loss) arising during the period
Pension lump-sum payment charges
Pension and other postretirement benefit items
Other comprehensive (loss) income, before tax
Income tax effect related to components of other comprehensive income (loss)
Other comprehensive income (loss), net of tax
Comprehensive income
Comprehensive loss attributable to redeemable non-controlling interest
Comprehensive income attributable to TEGNA Inc.
2020
Dec. 31,
2019
2018
$
482,763 $
286,235 $
405,665
138
(774)
362
6,209
22,574
—
28,783
28,921
(7,400)
21,521
504,284
15
5,764
5,141
(13,822)
(19,279)
686
(7,372)
(8,146)
2,060
(6,086)
280,149
—
7,498
(6,640)
(6,278)
1,535
(4,743)
400,922
—
400,922
$
504,299 $
280,149 $
The accompanying notes are an integral part of these consolidated financial statements.
49
TEGNA Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
In thousands of dollars
Cash flows from operating activities:
Net income
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation
Amortization of intangible assets
Stock-based compensation
Company stock 401(k) contribution
Amortization of deferred financing costs, debt discounts and premiums
Losses (gains) on assets
Provision for deferred income taxes
Equity income in unconsolidated investees, net
Changes in operating assets and liabilities, net of acquisitions:
Decreases (increase) decrease in trade receivables
Increase (decrease) in accounts payable
Increase (decrease) in interest and taxes payable
Increase in deferred revenue
Pension contributions, net of (income) expense
Changes in other assets and liabilities, net
Net cash flows from operating activities
Cash flows from investing activities:
Purchase of property and equipment
Reimbursement from spectrum repacking
2020
Dec. 31,
2019
2018
$
482,763 $
286,235 $
405,665
66,880
67,690
20,306
16,469
20,251
12,457
8,533
60,525
50,104
20,146
9,558
12,012
(7,402)
22,064
55,949
30,838
12,531
—
11,162
(4,991)
17,258
(10,397)
(10,149)
(13,792)
27,474
7,245
66,466
1,013
(10,400)
28,386
(86,245)
(29,526)
(8,284)
1,007
(5,351)
29,357
22,895
898
(19,447)
(42,015)
(3,125)
6,805
805,136
297,473
527,209
(45,499)
13,180
(88,356)
16,974
(65,230)
7,400
Payments for acquisitions of businesses and other assets, net of cash acquired
(34,841)
(1,514,183)
(328,433)
Payments for investments
Proceeds from investments
Proceeds from sale of businesses and assets
Net cash used for investing activities
Cash flows from by financing activities:
(2,415)
5,028
5,026
(4,986)
4,698
22,383
(11,677)
7,189
16,335
(59,521)
(1,563,470)
(374,416)
(Payments of) proceeds from borrowings under revolving credit facilities, net
(548,000)
853,000
50,000
Proceeds from borrowings
Debt repayments
Payments for debt issuance and premiums for early redemption costs
Dividends paid
Repurchases of common stock
Net settlement of stock for tax withholding and proceeds from stock option exercises
Proceeds from sale of minority ownership interest in Premion
Net cash (used for) provided by financing activities
Increase (decrease) in cash, cash equivalents and restricted cash
Balance of cash, cash equivalents and restricted cash at beginning of year
1,550,000
1,100,000
—
(1,623,000)
(710,000)
(121,146)
(41,378)
(76,465)
—
(9,208)
14,000
(22,018)
(60,624)
—
(819)
—
(5,269)
(60,290)
(5,831)
(2,436)
—
(734,051)
1,159,539
(144,972)
11,564
29,404
(106,458)
7,821
135,862
128,041
Balance of cash, cash equivalents and restricted cash at end of year
$
40,968 $
29,404 $
135,862
Supplemental cash flow information:
Cash paid for income taxes, net of refunds
Cash paid for interest
$
$
84,889 $
84,045 $
62,889
200,766 $
186,086 $
182,465
The accompanying notes are an integral part of these consolidated financial statements.
50
TEGNA Inc.
CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTEREST
In thousands of dollars, except per share data
Redeemable
noncontrolling
interest
Common
stock
TEGNA Inc. Shareholders’ Equity
Accumulated
other
comprehensive
income (loss)
Retained
earnings
Additional
paid-in
capital
Treasury
stock
Total
Balance as of Dec. 31, 2017
$
— $ 324,419 $ 382,127 $ 6,062,995 $
(106,923) $ (5,667,577) $ 995,041
Net Income
Other comprehensive loss, net of tax
Total comprehensive income
Cumulative effects of accounting changes
Dividends declared: $0.28 per share
Treasury stock acquired
Stock-based awards activity
Stock-based compensation
Other activity
405,665
21,121
(60,269)
(4,743)
(24,845)
405,665
(4,743)
400,922
(3,724)
(60,269)
(5,831)
(5,831)
95,560
(500)
12,531
2,754
(96,060)
12,531
2,754
Balance as of Dec. 31, 2018
$
— $ 324,419 $ 301,352 $ 6,429,512 $
(136,511) $ (5,577,848) $ 1,340,924
Net Income
Other comprehensive loss, net of tax
Total comprehensive income
Dividends declared: $0.28 per share
Company stock 401(k) contribution
Stock-based awards activity
Stock-based compensation
Other activity
286,235
(60,659)
(6,086)
(23,090)
(51,990)
20,146
1,079
286,235
(6,086)
280,149
32,648
51,170
(60,659)
9,558
(820)
20,146
1,079
Balance as of Dec. 31, 2019
$
— $ 324,419 $ 247,497 $ 6,655,088 $
(142,597) $ (5,494,030) $ 1,590,377
Net Income (loss)
Other comprehensive loss, net of tax
Total comprehensive income
Dividends declared: $0.28 per share
Company stock 401(k) contribution
Stock-based awards activity
Stock-based compensation
Sale of minority ownership interest in
Premion
Accretion of redeemable noncontrolling
interest
Adjustment of redeemable noncontrolling
interest to redemption value
Other activity
(15)
482,778
21,521
(61,278)
(933)
(15)
(71,808)
(80,805)
20,306
(1,923)
14,000
933
15
482,778
21,521
504,299
(61,278)
88,277
16,469
71,598
(9,207)
20,306
—
(933)
(15)
(1,923)
Balance as of Dec. 31, 2020
$
14,933 $ 324,419 $ 113,267 $ 7,075,640 $
(121,076) $ (5,334,155) $ 2,058,095
The accompanying notes are an integral part of these consolidated financial statements.
51
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 – Description of business, basis of presentation and summary of significant accounting policies
Description of business: We are an innovative media company serving the greater good of our communities. Our business
includes 64 television stations operating and two radio stations in 51 U.S. markets, offering high-quality television programming
and digital content. We also own leading multicast networks True Crime Network and Quest. Each television station also has a
robust digital presence across online, mobile and social platforms, reaching consumers on all devices and platforms they use to
consume news content. Through TEGNA Marketing Solutions (TMS), our integrated sales and back-end fulfillment operations,
we deliver results for advertisers across television, digital and Over the Top (OTT) platforms, including Premion, our OTT
advertising network.
Use of estimates: The financial statements have been prepared in accordance with U.S. generally accepted accounting
principles (GAAP). In doing so, we are required to make estimates and assumptions that affect the amounts reported in the
consolidated financial statements and accompanying notes. Significant estimates include, but are not limited to, evaluation of
goodwill and other intangible assets for impairment, allocation of purchase price to assets and liabilities in business
combinations, fair value measurements, post-retirement benefit plans, income taxes including deferred tax assets, and
contingencies.
COVID-19 pandemic: During the first quarter of 2020, a novel strain of coronavirus (COVID-19) believed to have been first
identified in Wuhan, China, spread globally, including to every state in the United States. On March 11, 2020, the World Health
Organization declared COVID-19 a pandemic, and on March 13, 2020, the United States declared a national emergency with
respect to COVID-19. The federal and state governments in the United States responded by instituting a wide variety of
mitigating control measures, including, mandatory quarantines, closures of non-essential businesses and all other places of
social interaction, while implementing “shelter in place” orders and travel restrictions in an effort to slow the spread of the virus.
Such mitigating measures began negatively impacting our advertising and marketing services (AMS) revenue stream in mid-
March 2020 as demand for non-political advertising softened. While some of these measures have been lifted or relaxed in
certain state and local governments, other jurisdictions have seen increases in new COVID-19 cases resulting in restrictions
being reinstated, or new restrictions imposed. Overall, advertising demand improved as steps toward economic re-opening were
implemented and as federal government stimulus programs were enacted. Our AMS revenues have shown quarterly sequential
improvement since the height of the pandemic in the second quarter of 2020. There continues to be considerable uncertainty
regarding how current and future health and safety measures implemented in response to the pandemic will impact our business.
Beginning in mid-March 2020, as a result of the expected near-term impact on non-political advertising demand caused by
the COVID-19 pandemic, we implemented cost saving measures to reduce operating expenses and discretionary capital
expenditures. These measures included implementing temporary furloughs for one week during the second quarter for most
personnel, reducing compensation for executives and our Board of Directors, and reducing non-critical discretionary spending.
As is true of most businesses, the ultimate magnitude of the COVID-19 pandemic cannot be reasonably estimated at this time,
but we do expect it to continue to have a dampening effect on our near-term AMS revenues, although to a much lower degree
than in mid-2020.
Due to the changing nature and continuing uncertainty around the COVID-19 pandemic, our ability to predict the impact of
COVID-19 on our financial condition, results of operations, liquidity and our business in future periods remains limited. While we
use the best information available in developing significant estimates included in our financial statements, the effects of the
pandemic on our operations may not be fully realized, or reflected in our financial results, until future periods. As such, actual
results could differ from our estimates, and these differences resulting from changes in facts and circumstances could be
material.
Basis of presentation: The consolidated financial statements include the accounts of subsidiaries we control and variable
interest entities if we are the primary beneficiary. We eliminate all intercompany balances, transactions, and profits in
consolidation. Investments in entities for which we have significant influence, but do not have control, are accounted for under
the equity method. Our share of net earnings and losses from these ventures is included in “Equity income in unconsolidated
investments, net” in the Consolidated Statements of Income.
Segment presentation: We operate one operating and reportable segment, which primarily consists of our 64 television
stations operating in 51 markets. Our reportable segment structure has been determined based on our management and internal
reporting structure, the nature of products and services we offer, and the financial information that is evaluated regularly by our
chief operating decision maker.
Cash and cash equivalents: Cash and cash equivalents consist of cash and highly liquid short-term investments with
original maturities of three months or less. Cash and cash equivalents are carried at cost plus accrued interest, which
approximates fair value.
Trade receivables and allowances for doubtful accounts: Trade receivables are recorded at invoiced amounts and
generally do not bear interest. The allowance for doubtful accounts reflects our estimate of credit exposure, determined
52
principally on the basis of our collection experience, aging of our receivables and any specific reserves needed for certain
customers based on their credit risk. Our allowance also takes into account expected future trends which may impact our
customers’ ability to pay, such as economic growth, unemployment and demand for our products and services, including the
impacts of the COVID-19 pandemic on these trends. We monitor the credit quality of our customers and their ability to pay
through the use of analytics and communication with individual customers. Bad debt expense, which is included in “Business
units - Selling, general and administrative expenses” on our Consolidated Statements of Income, was $8.0 million in 2020, $2.4
million in 2019 and $3.9 million in 2018. Write-offs of trade receivables (net of recoveries) were $4.7 million in 2020, $3.0 million
in 2019 and $3.9 million in 2018.
Property and equipment: Property and equipment are recorded at cost, and depreciation is provided generally on a straight-
line basis over the estimated useful lives of the assets. The estimated useful lives are generally: buildings and improvements, 10
to 40 years; and machinery, equipment and fixtures, 3 to 25 years. Expenditures for maintenance and repairs are expensed as
incurred. During 2020, 2019 and 2019, we had expenditures related to the Federal Communication Commission’s (FCC) repack
project. See Note 12 for further discussion.
Valuation of long-lived assets: We review the carrying amount of long-lived assets (mostly property and equipment and
definite-lived intangible assets) for impairment whenever events or changes in circumstances indicate that the carrying amount
may not be recoverable. Once an indicator of potential impairment has occurred, the impairment test is based on whether the
intent is to hold the asset for continued use or to hold the asset for sale. If the intent is to hold the asset for continued use, the
impairment test first requires a comparison of projected undiscounted future cash flows against the carrying amount of the asset
group. If the carrying value of the asset group exceeds the estimated undiscounted future cash flows, the asset group would be
deemed to be potentially impaired. The impairment, if any, would be measured based on the amount by which the carrying
amount exceeds the fair value. Fair value is determined primarily using the projected future cash flows, discounted at a rate
commensurate with the risk involved. Losses on long-lived assets to be disposed of are determined in a similar manner, except
that fair values are reduced for the cost to dispose. We recognized impairment charges in 2020 and 2019 related to long-lived
assets. See Note 11 for further discussion.
Goodwill and indefinite-lived intangible assets: The assets and liabilities of acquired businesses are recorded under the
acquisition method of accounting at their estimated fair values at the date of acquisition. Goodwill represents the excess of
acquisition cost over the fair value of assets acquired, including identifiable intangible assets, net of liabilities assumed.
Our goodwill balance was $3.0 billion as of December 31, 2020 and 2019. Goodwill is tested for impairment on an annual
basis (first day of our fourth quarter) or between annual tests if events or changes in circumstances indicate that the fair value of
our reporting unit may be below its carrying amount.
Before performing the annual goodwill impairment test quantitatively, we first have the option to perform a qualitative
assessment to determine if the quantitative test must be completed. The qualitative assessment considers events and
circumstances such as macroeconomic conditions, industry and market conditions, cost factors and overall financial
performance, as well as company and specific reporting unit specifications. If after performing this assessment, we conclude it is
more likely than not that the fair value of a reporting unit is less than its carrying amount, then we are required to perform the
quantitative test. Otherwise, the quantitative test is not required. In 2020, we elected not to perform the optional qualitative
assessment of goodwill and instead performed the quantitative impairment test.
Goodwill is accounted for at the segment level and allocated to, and tested for impairment at, a level referred to as the
reporting unit. We have determined that our one segment, Media, consists of a single reporting unit.
When performing the quantitative test, we determine the fair value of the reporting unit and compare it to the carrying amount,
including goodwill. If the carrying amount of the reporting unit exceeds the fair value of the reporting unit, the reporting unit’s
goodwill is impaired and we must recognize an impairment loss for the difference between the carrying amount and the fair value
of the reporting unit.
We estimate the fair value of our reporting unit based on a market-based valuation methodology, which is primarily based on
our consolidated market capitalization plus a reasonable control premium. In the fourth quarter of 2020, we completed our annual
goodwill impairment test for our reporting unit. The results of the test indicated that the estimated fair value of our reporting unit
significantly exceeded the carrying value.
We also have significant intangible assets with indefinite lives associated with FCC broadcast licenses related to our
acquisitions of television and radio stations. The FCC broadcast licenses are recorded at their estimated fair value at the date of
acquisition. Fair value is estimated using an income approach called the Greenfield method. The Greenfield method utilizes a
discounted cash flow model that incorporates several key assumptions, including market revenues, long-term growth projections,
estimated market share for a typical market participant, estimated profit margins based on market size and station type, and a
discount rate (determined using a weighted average cost of capital). Since these licenses are considered indefinite lived
intangible assets we do not amortize them, rather they are tested for impairment annually (first day of our fourth quarter), or more
often if circumstances dictate, for impairment and written down to fair value as required. We have the option to first perform a
qualitative assessment to determine if it is more likely than not that the fair value of the indefinite lived asset is more than its
53
carrying amount. If that is the case, then we do not need to perform the quantitative analysis. The qualitative assessment
considers trends in macroeconomic conditions, industry and market conditions, cost factors and overall financial performance of
the indefinite lived asset.
In 2020, we elected to perform the quantitative assessment for FCC licenses acquired in the KFMB acquisition as well as
those acquired in our 2019 acquisitions (acquisitions of Gray stations, Dispatch stations, and Nexstar stations - see Note 2),
which represented an aggregate carrying value of $897.7 million. These licenses have more limited headroom due to the fact
that we recently recorded them at fair value upon their respective acquisition. To estimate the fair values for the FCC broadcast
licenses, we applied an income approach, using the Greenfield method. The results of our 2020 annual impairment test of FCC
broadcast licenses indicated the fair value of a radio license was less than its carrying amount; and therefore, a $1.1 million
impairment charge was recorded within “Spectrum repacking reimbursements and other, net” on our Consolidated Statements of
Income. No other impairments occurred in 2020. See Note 11 for further discussion.
We performed the optional qualitative assessment for all of our other FCC licenses, which represented an aggregate carrying
value of $1.23 billion. In performing the qualitative impairment analysis, we analyzed trends in the significant inputs used in the
fair value determination of the FCC license assets. This included reviewing trends in market revenues, market share, profit
margins, long-term expected growth rates, and changes in the discount rate. The results of our qualitative procedures showed no
material adverse change in inputs that would indicate an impairment exists since the last quantitative test of these assets. As
such, we concluded it was more likely than not that the fair value of these indefinite lived FCC broadcast licenses was more than
their carrying amounts and therefore, we did not perform a quantitative test on these licenses in 2020.
The quantitative and qualitative analysis performed included projected estimated economic impacts from the COIVD-19
pandemic. A sustained economic decline resulting from COVID-19 larger than what was projected in our analysis could result in
future non-cash impairment charges of our recently acquired FCC licenses, and any related impairment could have a material
adverse impact on our results of operations.
Investments and other assets: Investments where we have the ability to exercise significant influence, but do not control,
are accounted for under the equity method of accounting. Significant influence typically exists if we have a 20% to 50%
ownership interest in the investee. Under this method of accounting, our share of the net earnings or losses of the investee is
included in non-operating income, on our Consolidated Statements of Income. We evaluate our equity method investments for
impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may be
impaired. If a decline in the value of an equity method investment is determined to be other than temporary, a loss is recorded in
earnings in the current period. Certain differences exist between our investment carrying value and the underlying equity of the
investee companies principally due to fair value measurement at the date of investment acquisition and due to impairment
charges we recorded for certain of the investments. We recognized gains of $19.7 million on the sale of four such investments in
2019.
Investments in non-public businesses that do not have readily determinable pricing, and for which we do not have control or
do not exert significant influence, are carried at cost less impairments, if any, plus or minus changes in observable prices for
those investments. Gains or losses resulting from changes in the carrying value of these investments are included as a non-
operating expense on our Consolidated Statements of Income. As of December 31, 2020, such investments totaled $20.3 million
and as of December 31, 2019, they totaled $32.4 million. During 2020, we recorded a $9.2 million impairment related to the
decline in fair value of one or our investees. During 2019, we recorded gains of $5.9 million due to an observable price increase
in two such investments. During 2018, we recorded impairment charges of $2.0 million on debt investments which had been
classified as an other long-term asset.
Our television stations are party to program broadcasting contracts which provide us with rights to broadcast syndicated
programs, original series and films. These contracts are recorded at the gross amount of the related liability when the programs
are available for telecasting. The related assets are recorded at the lower of cost or estimated net realizable value. Program
assets are classified as current (as a prepaid expense) or noncurrent (as an other asset) in the Consolidated Balance Sheets,
based upon the expected use of the programs in succeeding years. Expense is recognized on a straight line basis which
appropriately matches the cost of the programs with the revenues associated with them. During 2020, 2019 and 2018, we
incurred programming expense of $71.1 million, $60.8 million and $53.4 million, respectively. Programming expense is included
in “Cost of revenues” within our Consolidated Statements of Income. As of December 31, 2020, $47.3 million of programming
assets existed which we expect to be expensed within the next twelve months. The liability for these contracts is classified as
current or noncurrent in accordance with the payment terms of the contracts. The payment period generally coincides with the
period of telecast for the programs, but may be shorter.
We evaluate the net realizable value of our program broadcasting contract assets when a triggering event occurs, such as a
change in our intended usage, or sustained lower than expected ratings for the program. Impairment analysis are performed at
the syndicated program level (across all stations that utilize the program). We determine the net realizable value based on a
projection of the estimated revenues less projected direct costs associated with the syndicated program (which is classified as
Level 3 in the fair value hierarchy). If the future direct costs exceed expected revenues, impairment of the program asset may be
required. No impairment charges were recognized in 2020, 2019 or 2018.
54
Revenue recognition: We adopted the FASB’s new revenue recognition guidance beginning January 1, 2018 using the
modified retrospective method. We began recognizing revenue under this new guidance in the first quarter of 2018 and did not
restate prior years. We applied the standard to all contracts open as of January 1, 2018. The cumulative prior period effect of
applying the guidance was $3.7 million which was recorded as a decrease to retained earnings upon adoption.
Revenue is recognized upon the transfer of control of promised services to our customers in an amount that reflects the
consideration we expect to receive in exchange for those services. Revenue is recognized net of any taxes collected from
customers, which are subsequently remitted to governmental authorities. Amounts received from customers in advance of
providing services to our customers are recorded as deferred revenue.
Our primary source of revenue is now our subscription revenue from retransmission consent contracts with multichannel
video programming distributors (e.g., cable and satellite providers) and over the top providers (companies that deliver video
content to consumers over the Internet). Under these multi-year contracts, we have performance obligations to provide our
customers with our stations’ signals, as well as our consent to retransmit those signals to their customers. Subscription revenue
is recognized in accordance with the guidance for licensing intellectual property utilizing a usage based method. The amount of
revenue earned is based on the number of subscribers to which our customers retransmit our signal, and the negotiated fee per
subscriber included in our contract agreement. Our customers submit payments monthly, generally within 60-90 days after the
month that the service was provided. Our performance obligations are satisfied, and revenue is recognized, as our customers
retransmit our signal. This measure toward satisfaction of our performance obligations and recognition of revenue is the most
appropriate as it aligns our revenue recognition with the value that we are delivering to our customers through our retransmission
consent.
We also earn revenue through the sale of advertising and marketing services (AMS). This revenue stream includes all
sources of our traditional television and radio advertising, as well as digital revenues including Premion. Contracts within this
revenue stream are short-term in nature (most often three months or less). Contracts generally consist of multiple deliverables,
such as television commercials, or digital advertising solutions, that we have identified as individual performance obligations.
Before performing under the contract, we establish the transaction price with our customer based on the agreed upon rates for
each performance obligation. There is no material variability in the transaction price during the term of the contract.
Revenue is recognized as we fulfill our performance obligations to our customers. For our AMS revenue stream, we
measure the fulfillment of our performance obligations based on the airing of the individual television commercials or display of
digital advertisements. This measure is most appropriate as it aligns our revenue recognition with the value we are providing to
our customers. The price of each individual commercial and digital advertisement is negotiated with our customer and is
determined based on multiple factors, including, but not limited to, the programming and day-part selected, supply of available
inventory, our station’s viewership ratings and overall market conditions (e.g., timing of the year and strength of U.S. economy).
Customers are billed monthly and payment is generally due 30 days after the date of invoice. Commission costs related to these
contracts are expensed as incurred due to the short-term nature of the contracts.
We also generate revenue from the sale of political advertising. Contracts within this revenue stream are short-term in
nature (typically weekly or monthly buys during political campaigns). Customers pre-pay these contracts and we therefore defer
the associated revenue until the advertising has been delivered, at which time we have satisfied our performance obligations and
recognize revenue. Commission costs related to these contracts are expensed as incurred due to the short-term nature of the
contracts.
Our remaining revenue is comprised of various other services, primarily production services (for news content and
commercials) and sublease rental income. Revenue is recognized as these various services are provided to our customers.
In instances where we sell services from more than one revenue stream to the same customer at the same time, we
recognize one contract and allocate the transaction price to each deliverable element (e.g., performance obligation) based on the
relative fair value of each element.
Revenue earned by categories in 2020, 2019 and 2018 are shown below (amounts in thousands):
2020
Year ended Dec. 31,
2019
2018
Subscription
$
1,286,611 $
1,005,030 $
840,838
Advertising & Marketing Services
1,174,774
1,226,607
1,106,754
Political
Other
445,535
30,860
38,478
29,382
233,613
26,077
Total revenues
$
2,937,780 $
2,299,497 $
2,207,282
Retirement plans: Certain employees are covered by defined benefit pension plans and we provide certain medical and life
insurance benefits to eligible retirees (collectively postretirement benefit plans). The amounts we record related to our
55
postretirement benefit plans are computed using actuarial valuations that are based in part on certain key economic assumptions
we make, including the discount rate, the expected long-term rate of return on plan assets and other actuarial assumptions
including mortality estimates, health care cost trend rates and employee turnover, each as appropriate based on the nature of the
plans. Depending on the timing of the estimated payments, we recognize the funded status of our postretirement benefit plans as
a current or non-current liability within our Consolidated Balance Sheets. When annually adjusting to recognize the funded status
of the plan, there is a corresponding non-cash adjustment to accumulated other comprehensive loss, net of tax benefits,
recorded in the Consolidated Statements of Equity. The funded status is measured as the difference between the fair value of the
plan’s assets and the benefit obligation of the plan.
Stock-based employee compensation: We grant restricted stock units (RSUs) and performance shares to employees as a
form of compensation. The expense for the RSUs is based on the grant date fair value of the award and is generally recognized
on a straight-line basis. Expense related to the performance share program is marked to market each month over the first two-
year performance period. Expense under these programs is recognized over the requisite service period, which is typically a
four-year period for RSUs and a three-year period for performance shares. Performance share expense for participants meeting
certain retirement eligible criteria as defined in the plan is recognized using the accelerated attribution method. See Note 10 for
further discussion.
Advertising and marketing costs: We expense advertising and marketing costs, such as costs to promote our brands, as
they are incurred. Advertising expense was $5.8 million in 2020, $9.4 million in 2019 and $10.4 million in 2018, and are included
in “Selling, general and administrative expenses” on the Consolidated Statements of Income.
Income taxes: Income taxes are presented on the consolidated financial statements using the asset and liability method,
under which deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary
differences that exist between the financial statement carrying amount of assets and liabilities and their respective tax basis, as
well as from tax loss and tax credit carry-forwards. Deferred income taxes reflect expected future tax benefits (i.e., assets) and
future tax costs (i.e., liabilities). The tax effect of net operating loss, capital loss and general business credit carryovers result in
deferred tax assets. We measure deferred tax assets and liabilities using the enacted tax rate expected to apply to taxable
income in the years in which those temporary differences are expected to be recoverable or settled. We recognize the effect on
deferred taxes of a change in tax rates in income in the period that includes the enactment date. Valuation allowances are
established if, based upon the weight of available evidence, management determines it is “more likely than not” that some
portion or all of the deferred tax asset will not be realized.
We periodically assess our tax filing exposures related to periods that are open to examination. Based on the latest available
information, we evaluate our tax positions to determine whether it is more likely than not the position will be sustained upon
examination by the relevant taxing authority. If we cannot reach a more likely than not determination, no benefit is recorded. If we
determine the tax position is more likely than not to be sustained, we record the largest amount of benefit that is more likely than
not to be realized when the tax position is settled. We record interest and penalties related to income taxes as a component of
income tax expense on our Consolidated Statements of Income. Interest and penalties were not material in each year presented.
Loss contingencies: We are subject to various legal proceedings, claims and regulatory matters, the outcomes of which are
subject to significant uncertainty. We determine whether to disclose or accrue for loss contingencies based on an assessment of
whether the risk of loss is remote, reasonably possible or probable, and whether it can be reasonably estimated. We accrue for
loss contingencies when such amounts are probable and reasonably estimable. If a contingent liability is only reasonably
possible, we will disclose the potential range of the loss, if material and estimable.
Accounting guidance adopted in 2020: In June 2016, the Financial Accounting Standards Board (FASB) issued new
guidance related to the measurement of credit losses on financial instruments. The new guidance changed the way credit losses
on accounts receivable are estimated. Under previous GAAP, credit losses on accounts receivable were recognized once it was
probable that such losses will occur. Under the new guidance, we are required to estimate credit losses based on the expected
amount of future collections which may result in earlier recognition of doubtful accounts. We adopted the new guidance on
January 1, 2020 using a modified retrospective approach. Due to the short-term nature of our accounts receivable balance, there
was no material change to our allowance for doubtful accounts as a result of adopting this new guidance.
In March 2019, the FASB issued new guidance related to the accounting for episodic television series. The most significant
aspect of this new guidance that is applicable to us relates to the level at which our capitalized programming assets are
monitored for impairment. Under the new guidance these assets are monitored at the film group level which is the lowest level at
which independently identifiable cash flows are identifiable. We adopted the new guidance prospectively on January 1, 2020.
There was no material impact on our consolidated financial statements and related disclosures as of the adoption date.
In August 2018, the FASB issued new guidance that changed disclosures related to defined benefit pension and other
postretirement benefit plans. The guidance removed disclosures that are no longer economically relevant, clarifies certain
existing disclosure requirements and added some new disclosures. The most relevant elimination for us is the annual disclosure
of the amount of gain/loss and prior service cost/credit amortization expected in the following year. The most relevant addition
impacting us is annually disclosing explanations of the drivers for significant changes in plan obligations. We have included the
new disclosure in our retirement footnote (Note 7) herein and applied them on a retrospective basis.
56
New accounting guidance not yet adopted: There is no accounting guidance currently pending that we expect to have a
material impact on our consolidated financial statements or disclosures.
NOTE 2 – Acquisitions
During 2019, we acquired the television stations listed in the table below, and a summary of each acquisition follows:
Market
Station
WTHR
Indianapolis, IN
WBNS
Columbus, OH
WTIC/WCCT
Hartford-New Haven, CT
WPMT
Harrisburg-Lancaster-Lebanon-York, PA
WATN/WLMT
Memphis, TN
WNEP
Wilkes Barre-Scranton, PA
WOI/KCWI
Des Moines-Ames, IA
WZDX
Huntsville-Decatur-Florence, AL
Davenport, IA and Rock Island-Moline, IL
WQAD
Ft. Smith-Fayetteville-Springdale-Rogers, AR KFSM
WTOL
Toledo, OH
KWES
Midland-Odessa, TX
Affiliation
NBC
CBS
FOX/CW
FOX
ABC/CW
ABC
ABC/CW
FOX
ABC
CBS
CBS
NBC
Seller
Dispatch Broadcast Group
Dispatch Broadcast Group
Nexstar Media Group
Nexstar Media Group
Nexstar Media Group
Nexstar Media Group
Nexstar Media Group
Nexstar Media Group
Nexstar Media Group
Nexstar Media Group
Gray Television
Gray Television
Nexstar Stations
On September 19, 2019, we completed our acquisition of 11 local television stations in eight markets, including eight Big Four
affiliates, from Nexstar Media Group (the Nexstar Stations). These stations were divested by Nexstar Media Group in connection
with its acquisition of Tribune Media Company. The purchase price for the Nexstar Stations was $769.9 million which included a
base purchase price of $740.0 million and an estimated working capital of $29.9 million (approximately $0.8 million was paid in
April 2020 after finalization of the working capital true-up with the seller).
Dispatch Stations
On August 8, 2019, we completed the acquisition of Dispatch Broadcast Group’s two top-rated television stations and two
radio stations (the Dispatch Stations). The purchase price for the Dispatch Stations was $560.5 million which consisted of a base
purchase price of $535.0 million and working capital and cash acquired of $25.5 million.
Justice and Quest Multicast Networks
On June 18, 2019, we completed the acquisition of the remaining approximately 85% interest that we did not previously own
in the multicast networks Justice Network (which has since been rebranded as True Crime Network) and Quest from Cooper
Media. Cash paid for this acquisition was $77.1 million (which included $4.6 million for working capital).
Gray Stations
On January 2, 2019, we completed our acquisition of WTOL, the CBS affiliate in Toledo, OH, and KWES, the NBC affiliate in
Midland-Odessa, TX from Gray Television, Inc. for approximately $109.9 million in cash (which includes $4.9 million for working
capital paid at closing).
57
The following table summarizes the fair values of the assets acquired and liabilities assumed in connection with these
acquisitions (in thousands):
Cash
Accounts receivable
Prepaid expenses and other current assets
Property and equipment
Goodwill
FCC licenses
Network affiliation agreements
Retransmission agreements
Other intangible assets
Right-of-use assets for operating leases
Other noncurrent assets
Total assets acquired
Accounts payable
Accrued liabilities
Deferred income tax liability
Operating lease liabilities - noncurrent
Other noncurrent liabilities
Total liabilities assumed
Net assets acquired
Less: cash acquired
$
$
$
Nexstar
Stations
Dispatch
Stations
Justice &
Quest
Gray
Stations
Total
$
— $
2,363 $
— $
— $
2,363
34,680
3,776
45,186
128,191
374,269
123,926
68,316
—
22,715
237
26,344
6,092
40,418
202,312
295,983
60,765
33,107
—
362
—
8,501
6,987
361
23,567
—
—
—
52,553
—
5,253
5,553
987
11,757
19,405
47,061
14,420
12,198
—
251
18
75,078
17,842
97,722
373,475
717,313
199,111
113,621
52,553
23,328
5,508
$
801,296 $
667,746 $
97,222 $
111,650 $ 1,677,914
2,037
8,544
—
20,346
426
954
9,011
97,082
226
—
725
4,236
(462)
—
2,677
1
1,494
—
235
—
3,717
23,285
96,620
20,807
3,103
31,353 $
107,273 $
7,176 $
1,730 $
147,532
769,943 $
560,473 $
90,046 $
109,920 $ 1,530,382
— $
(2,363) $
— $
— $
(2,363)
Less: fair value of existing ownership
—
—
(12,995)
—
(12,995)
Cash paid for acquisitions
$
769,943 $
558,110 $
77,051 $
109,920 $ 1,515,024
We accounted for each of these acquisitions as business combinations, which required us to record the assets acquired
and liabilities assumed at fair value. The amount by which the purchase price exceeds the fair value of the net assets acquired
was recorded as goodwill.
During 2020, we continued to analyze information related to the estimated fair values for certain tangible and intangible
assets acquired, liabilities assumed and the amount of goodwill recognized for these acquisitions and recorded certain
adjustments to reduce our retransmission agreement intangible assets by $21.3 million and increase the carrying amount of our
goodwill by $18.1 million. During 2020, we finalized the fair value of assets acquired and liabilities assumed for the acquisitions;
therefore, the amounts presented above are now final.
58
NOTE 3 – Goodwill and other intangible assets
We operate as one operating and reportable segment which includes the goodwill balances as of December 31, 2020 and
December 31, 2019 shown below (in thousands):
Balance as of Dec. 31, 2018
Acquisitions
Disposition of a business unit
Balance as of Dec. 31, 2019
Adjustments
Balance as of Dec. 31, 2020
Goodwill
$ 2,596,863
355,368
(1,644)
2,950,587
18,106
$ 2,968,693
The change in goodwill during both years is primarily attributable to the acquisitions discussed in Note 2.
The following table displays indefinite-lived intangible assets and amortizable intangible assets as of December 31, 2020 and
2019 (in thousands):
Dec. 31, 2020
Indefinite-lived intangibles:
Gross
Accumulated
Amortization
Net
Television and radio station FCC broadcast licenses
$
2,123,898 $
— $
2,123,898
Amortizable intangible assets:
Retransmission agreements
Network affiliation agreements
Other
Total indefinite-lived and amortizable intangible assets
Dec. 31, 2019
Indefinite-lived intangibles:
Television and radio station FCC broadcast licenses
Amortizable intangible assets:
Retransmission agreements
Network affiliation agreements
Other
Total indefinite-lived and amortizable intangible assets
235,215
309,503
70,610
2,739,226 $
(138,928)
(72,694)
(23,960)
(235,582) $
96,287
236,809
46,650
2,503,644
$
$
2,090,732 $
— $
2,090,732
256,533
309,496
73,305
2,730,066 $
(105,212)
(48,174)
(15,066)
(168,452) $
151,321
261,322
58,239
2,561,614
$
Our retransmission agreements and network affiliation agreements are amortized on a straight-line basis over their estimated
useful lives. Other intangibles primarily include distribution agreements and brand names which are also amortized on a straight-
line basis over their useful lives.
In June 2020, we acquired the assets and FCC license of KTBU, a full power UHF station in Houston, Texas. In addition, in
November 2020, we acquired the assets and FCC license of KMPX a full power UHF station in Dallas, Texas. In connection with
these two transactions, we recorded total indefinite-lived FCC broadcast licenses of $34.3 million.
In the second quarter of 2020, we recognized a $2.1 million impairment charge in connection with eliminating the use of the
Justice Network brand name and re-establishing the business under a new brand name called True Crime Network. Additionally,
our 2020 annual impairment test performed on FCC broadcast licenses indicated the fair value of a radio license was less than
its carrying amount; and therefore, a $1.1 million impairment charge was recorded. Both impairment charges were recorded in
the “Spectrum repacking reimbursements and other, net” line item of the Consolidated Statements of Income.
59
The following table shows the projected annual amortization expense related to amortizable intangible assets existing as of
December 31, 2020 (in thousands):
2021
2022
2023
2024
2025
Thereafter
Total
$
62,854
59,711
53,296
47,132
28,296
128,457
$
379,746
NOTE 4 – Investments and other assets
Our investments and other assets consisted of the following as of December 31, 2020 and 2019 (in thousands):
Cash value life insurance
Equity method investments
Other equity investments
Deferred debt issuance costs
Other long-term assets
Total
Dec. 31,
2020
2019
$
52,883 $
32,067
20,271
9,378
21,620
$
136,219 $
52,462
27,650
32,383
10,921
21,853
145,269
Cash value life insurance: We are the beneficiary of life insurance policies on the lives of certain employees/retirees, which
are recorded at their cash surrender value as determined by the insurance carrier. These policies are utilized as a partial funding
source for deferred compensation and other non-qualified employee retirement plans. Gains and losses on these investments
are included in “Other non-operating items, net” within our Consolidated Statements of Income and were not material for all
periods presented.
Other equity investments: Represent investments in non-public businesses that do not have readily determinable pricing, and
for which we do not have control or do not exert significant influence. These investments are recorded at cost less impairments, if
any, plus or minus changes in observable prices for those investments. In 2020, we recorded a $9.2 million impairment charge
due to the decline in the fair value of one of our investees. In 2019, we recognized gain of $5.9 million, based on observable
price changes for certain equity investments without readily determinable fair value. The 2020 impairment charge and 2019 gain
were recorded within “Other non-operating items, net” in the Consolidated Statements of Income.
Deferred debt issuance costs: These costs consist of amounts paid to lenders related to our revolving credit facility. Debt
issuance costs paid for our term debt and unsecured notes are accounted for as a reduction in the debt obligation.
60
NOTE 5 – Income taxes
The provision for income taxes from continuing operations consists of the following (in thousands):
2020
Federal
State and other
Total
2019
Federal
State and other
Total
2018
Federal
State and other
Total
Current
Deferred
Total
123,882 $
4,532 $
128,414
21,878
4,001
25,879
145,760 $
8,533 $
154,293
Current
Deferred
Total
59,791 $
21,345 $
7,567
719
67,358 $
22,064 $
81,136
8,286
89,422
Current
Deferred
Total
77,795 $
15,765 $
9,527
4,280
93,560
13,807
87,322 $
20,045 $
107,367
$
$
$
$
$
$
Income from continuing operations before income taxes attributable to TEGNA Inc. consists entirely of domestic income.
The provision for income taxes varies from the U.S. federal statutory tax rate as a result of the following differences:
U.S. statutory tax rate
Increase (decrease) in taxes resulting from:
State taxes (net of federal income tax benefit)
Uncertain tax positions, settlements and lapse of statutes of limitations
Other valuation allowances, tax rate changes, & deferred adjustments
Valuation allowance on equity method investment
Enactment of the Tax Cuts and Jobs Act
Non-deductible transactions costs
Net excess benefits or expense on share-based payments
Other, net
Effective tax rate
2020
21.0%
3.3
(0.1)
(0.1)
0.4
—
—
(0.1)
(0.2)
24.2%
2019
21.0%
3.1
(1.6)
(1.7)
1.7
—
0.3
0.4
0.6
23.8%
2018
21.0%
2.9
(0.3)
(1.0)
—
(1.1)
—
0.1
(0.5)
21.1%
Deferred income taxes reflect temporary differences in the recognition of revenue and expense for tax reporting and financial
statement purposes. Deferred tax liabilities and assets are adjusted for changes in tax laws or tax rates of the various tax
jurisdictions as of the enacted date.
61
Deferred tax liabilities and assets were composed of the following as of the end of December 31, 2020 and 2019 (in
thousands):
Deferred tax liabilities
Accelerated depreciation
Accelerated amortization of deductible intangibles
Right-of-use assets for operating leases
Other
Total deferred tax liabilities
Deferred tax assets
Accrued compensation costs
Pension and post-retirement medical and life
Loss carryforwards
Operating lease liabilities
Other
Total deferred tax assets
Deferred tax asset valuation allowance
Total net deferred tax (liabilities)
Dec. 31,
2020
2019
$
67,479 $
62,951
536,740
24,220
3,322
631,761
18,559
25,523
38,348
25,319
37,239
144,988
43,467
524,697
25,615
3,677
616,940
16,180
35,192
38,686
26,008
30,914
146,980
45,661
$
(530,240) $
(515,621)
As of December 31, 2020, we had approximately $107.9 million of capital loss carryforwards for federal and state purposes
including $26.1 million of which will expire if not used prior to 2022, $73.0 million of which will expire if not used prior to 2023, and
the remainder of which will expire if not used prior to 2026. Capital loss carryforwards can only be utilized to the extent capital
gains are recognized. As of December 31, 2020, we had established a valuation allowance on all federal and state capital loss
carryforwards. As of December 31, 2020, we also had approximately $10.8 million of state net operating loss carryovers that, if
not utilized, will expire in various amounts beginning in 2022 through 2039 and $5.4 million of state interest disallowance
carryovers that do not expire.
Included in total deferred tax assets were valuation allowances of approximately $43.5 million as of December 31, 2020 and
$45.7 million as of December 31, 2019, primarily related to federal and state capital losses, minority investments, state interest
disallowance carryovers, and state net operating losses available for carry forward to future years. If, in the future, we believe
that it is more likely than not that these deferred tax assets will be realized, the valuation allowances will be reversed in the
Consolidated Statements of Income.
Realization of deferred tax assets for which valuation allowances have not been established is dependent upon generating
sufficient future taxable income. We expect to realize the benefit of these deferred tax assets through future reversals of our
deferred tax liabilities, through the recognition of taxable income in the allowable carryback and carryforward periods, and
through implementation of future tax planning strategies. Although realization is not assured, we believe it is more likely than not
that all deferred tax assets for which valuation allowances have not been established will be realized.
The following table summarizes the activity related to deferred tax asset valuation allowances (in thousands):
Beginning at beginning of period
Additions to valuation allowance
Reductions to valuation allowance
Balance at the end of the period
Tax Matters Agreements
2020
2019
2018
$
$
45,661 $
3,719
(5,913)
43,467 $
125,894 $
9,545
(89,778)
45,661 $
136,418
3,908
(14,432)
125,894
Prior to the May 31, 2017 spin-off of the Cars.com business, we entered into a Tax Matters Agreement with Cars.com Inc. that
governs each company’s respective rights, responsibilities, and obligations with respect to tax liabilities and benefits, tax
attributes, tax contests and other matters regarding income taxes, non-income taxes and related tax returns. The agreement
provides that we will generally indemnify Cars.com against taxes attributable to assets or operations for all tax periods or
portions thereof prior to the spin-off date including separately-filed U.S. federal, state, and foreign taxes. On October 15, 2021,
TEGNA’s 2017 tax year (including the tax-free treatment of the spin-off of the Cars.com business) will no longer be subject to
examination by the Internal Revenue Service.
62
Uncertain Tax Positions
The following table summarizes the activity related to unrecognized tax benefits, excluding the federal tax benefit of state tax
deductions (in thousands):
Change in unrecognized tax benefits
Balance as of beginning of year
Additions based on tax positions related to the current year
Additions for tax positions of prior years
Reductions for tax positions of prior years
Settlements
2020
2019
2018
$
8,050 $
12,843 $
15,043
—
630
—
—
—
—
(959)
(288)
40
2,631
—
(182)
(4,689)
Reductions due to lapse of statutes of limitations
(1,245)
(3,546)
Balance as of end of year
$
7,435 $
8,050 $
12,843
The total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was $6.0 million as of
December 31, 2020, and $6.4 million as of December 31, 2019. This amount includes the federal tax benefit of state tax
deductions.
We recognize interest and penalties related to unrecognized tax benefits as a component of income tax expense. We also
recognize interest income attributable to overpayment of income taxes and from the reversal of interest expense previously
recorded for uncertain tax positions which are subsequently released as a component of income tax expense. We did not
recognize income or expense from the reversal of previously recorded interest expense for uncertain tax positions in 2020, but
recognized income of $1.7 million in 2019, and $0.2 million in 2018. The amount of accrued interest expense and penalties
payable related to unrecognized tax benefits was $0.1 million as of December 31, 2020 and December 31, 2019.
We file income tax returns in the U.S. and various state jurisdictions. The 2016 through 2020 tax years remain subject to
examination by the Internal Revenue Service and state authorities. Tax years before 2016 remain subject to examination by
certain states due to ongoing audits.
It is reasonably possible that the amount of unrecognized benefit with respect to certain of our unrecognized tax positions will
increase or decrease within the next 12 months. These changes may be the result of settlement of ongoing audits, lapses of
statutes of limitations or other regulatory developments. At this time, we estimate the amount of our gross unrecognized tax
positions may decrease by up to approximately $0.6 million within the next 12 months primarily due to lapses of statutes of
limitations and settlement of ongoing audits in various jurisdictions.
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NOTE 6 – Long-term debt
Our long-term debt is summarized below (in thousands):
Unsecured floating rate term loan due quarterly through June 2020
Unsecured floating rate term loan due quarterly through September 2020
Unsecured notes bearing fixed rate interest at 5.125% due July 2020
Unsecured notes bearing fixed rate interest at 4.875% due September 2021
Unsecured notes bearing fixed rate interest at 6.375% due October 2023
Borrowings under revolving credit facility expiring August 2024
Unsecured notes bearing fixed rate interest at 5.50% due September 2024
Unsecured notes bearing fixed rate interest at 4.75% due March 2026
Unsecured notes bearing fixed rate interest at 7.75% due June 2027
Unsecured notes bearing fixed rate interest at 7.25% due September 2027
Unsecured notes bearing fixed rate interest at 4.625% due March 2028
Unsecured notes bearing fixed rate interest at 5.00% due September 2029
Total principal long-term debt
Debt issuance costs
Unamortized premiums and discounts, net
Total long-term debt
Dec. 31,
2020
— $
—
—
—
—
355,000
137,000
550,000
200,000
240,000
1,000,000
1,100,000
3,582,000
(36,595)
7,815
3,553,220 $
2019
20,000
105,000
310,000
350,000
650,000
903,000
325,000
—
200,000
240,000
—
1,100,000
4,203,000
(26,873)
3,118
4,179,245
$
$
On January 9, 2020, we completed a private placement offering of $1.0 billion aggregate principal amount of senior
unsecured notes bearing an interest rate of 4.625% which are due in March 2028.
On February 11, 2020 we used the net proceeds from the $1.0 billion unsecured senior notes to repay the remaining
$310.0 million of unsecured senior notes bearing fixed rate interest of 5.125%, which were due in July 2020 and $650.0 million of
unsecured senior notes bearing fixed rate interest of 6.375%, which were due in October 2023. We incurred $13.8 million of early
redemption fees in relation to the 2023 debt payoff. Additionally, we wrote off $7.9 million of unamortized financing fees and
discounts related to the early payoff of the 2020 and 2023 notes. These charges were recorded in the other non-operating items,
net line item of the Consolidated Statements of Income.
Given the unpredictability of market conditions during the pandemic, we amended our revolving credit facility on June 11,
2020 to extend the initial step-down of the maximum permitted total leverage ratio (from 5.50 to 1.00 to 5.25 to 1.00) until the
fiscal quarter ending March 31, 2022, with additional step downs continuing thereafter. The maximum permitted total leverage
ratios under our revolving credit facility are now as follows:
Period
Fiscal quarter ending September 30, 2020 through and including
fiscal quarter ending December 31, 2021
Fiscal quarter ending March 31, 2022
Fiscal quarter ending June 30, 2022
Fiscal quarter ending September 30, 2022
Thereafter
Leverage Ratio
5.50 to 1.00
5.25 to 1.00
5.00 to 1.00
4.75 to 1.00
4.50 to 1.00
On September 10, 2020, we issued $550 million aggregate principal amount of senior unsecured notes bearing an interest
rate of 4.750% which are due in March 2026. The proceeds were used to pay down borrowings from our revolving credit facility.
On October 13, 2020 we utilized our revolving credit facility to repay the entire $350 million aggregate principal amount of our
4.875% unsecured senior notes due in 2021 and $188 million aggregate principal amount of our 5.500% unsecured senior notes
due in 2024 and a $3.4 million redemption premium on our unsecured senior notes due in 2024.
As of December 31, 2020, we had unused borrowing capacity of $1.13 billion under our revolving credit facility. As of
December 31, 2020, we were in compliance with all covenants contained in our debt agreements and credit facility, including the
leverage ratio (our one financial covenant) contained in our debt agreements and revolving credit facility. We believe that we will
remain compliant with all covenants for the foreseeable future.
64
Our debt maturities may be repaid with cash flow from operating activities, accessing capital markets or a combination of
both. The following schedule discloses annual maturities of the principal amount of total debt due (in thousands):
Repayment schedule of principal long-term debt as of Dec. 31, 2020
2021
2022
2023
2024 (1)
2025
Thereafter
Total
$
$
—
—
—
492,000
—
3,090,000
3,582,000
(1) Assumes current revolving credit facility borrowings come due in 2024 and credit facility is not extended.
NOTE 7 – Retirement plans
We have various defined benefit retirement plans. Our principal defined benefit pension plan is the TEGNA Retirement Plan
(TRP). The disclosure tables presented below include the assets and obligations of the TRP and the TEGNA Supplemental
Retirement Plan (SERP). We use a December 31 measurement date convention for our retirement plans.
Pension costs, which primarily include costs for our qualified TRP and non-qualified SERP, are presented in the following
table (in thousands):
2020
2019
2018
Service cost-benefits earned during the period
Interest cost on benefit obligation
Expected return on plan assets
Amortization of prior service cost
Amortization of actuarial loss
Pension payment timing related charge
$
7 $
8 $
19,487
(31,058)
90
6,207
—
23,066
(26,320)
90
6,123
686
(Gains from) expense for company-sponsored retirement plans
$
(5,267) $
3,653 $
12
21,337
(30,935)
168
5,124
7,498
3,204
Benefits no longer accrue for substantially all TRP and SERP participants as a result of amendments to the plans in the past
years and as such we no longer incur a significant amount of the service cost component of pension expense. All other
components of our pension expense presented above are included within the “Other non-operating items, net” line item of the
Consolidated Statements of Income.
65
The following table provides a reconciliation of pension benefit obligations (on a projected benefit obligation measurement
basis), plan assets and funded status of company-sponsored retirement plans, along with the related amounts that are
recognized in the Consolidated Balance Sheets (in thousands).
Dec. 31,
2020
2019
Change in benefit obligations
Benefit obligations as of beginning of year
Service cost
Interest cost
Actuarial losses
Benefits paid
Settlements (1)
Benefit obligations as of end of year
Change in plan assets
Fair value of plan assets as of beginning of year
$
613,695 $
7
19,487
48,491
(35,018)
—
646,662 $
479,735 $
103,146
5,133
(35,018)
$
$
554,795
8
23,066
73,906
(34,771)
(3,309)
613,695
407,550
87,165
23,100
(34,771)
(3,309)
479,735
(133,960)
(6,814)
(127,146)
Actual gains return on plan assets
Employer contributions
Benefits paid
Settlements (1)
Fair value of plan assets as of end of year
Funded status as of end of year
Amounts recognized in Consolidated Balance Sheets
Accrued liabilities other—current
Pension liabilities—non-current
(1) Settlements represent lump sum benefit payments to certain SERP plan participants. When aggregate lump sums exceed the settlement
threshold, pension payment timing related charges are incurred, and the lump sum payments prompting the charge are shown on a separate
line from other benefit payments.
552,996 $
(93,666) $
(7,758) $
(85,908) $
—
$
$
$
$
The actuarial loss in 2020 of $48.5 million was primarily due to decline in the discount rate used to calculate the benefit
obligation (which declined from 3.29% at December 31, 2019 to 2.54% as of December 31, 2020) which resulted in an actuarial
loss of $49.3 million.
The actuarial loss in 2019 of $73.9 million was primarily due to decline in the discount rate used to calculate the benefit
obligation (which declined from 4.34% at December 31, 2018 to 3.29% as of December 31, 2019) which resulted in an actuarial
loss of $61.4 million. In addition, changes to the mortality assumption resulted in an actuarial loss of $11.3 million.
The funded status (on a projected benefit obligation basis) of our principal retirement plans as of December 31, 2020, is as
follows (in thousands):
TRP
SERP (1)
All other
Total
(1) The SERP is an unfunded, unsecured liability
Fair Value of
Plan Assets
Benefit
Obligation
Funded
Status
$
552,996 $
—
—
$
552,996 $
576,846 $
69,294
522
646,662 $
(23,850)
(69,294)
(522)
(93,666)
The accumulated benefit obligation for all defined benefit pension plans was $646.6 million as of December 31, 2020 and
$613.7 million as of December 31, 2019. In December of 2019, a discretionary contribution was made to TRP of $12 million. As a
result of the discretionary contribution, no additional contributions were required in 2020. We made contributions to the SERP of
$5.0 million in 2020. Based on actuarial projections, we do not expect to make any contributions to the TRP in 2021. Cash
contributions of $7.7 million are expected to be made to our SERP participants in 2021.
The following table presents information for our retirement plans for which accumulated benefit obligation exceed assets (in
thousands):
Accumulated benefit obligation
Fair value of plan assets
66
Dec. 31,
2020
2019
$
$
646,644 $
552,996 $
613,655
479,735
The following table presents information for our retirement plans for which projected benefit obligations exceed assets (in
thousands):
Projected benefit obligation
Fair value of plan assets
Dec. 31,
2020
2019
$
$
646,662 $
552,996 $
613,695
479,735
The following table summarizes the pre-tax amounts recorded in accumulated other comprehensive loss that have not yet
been recognized as a component of pension expense (in thousands):
Net actuarial losses
Prior service cost
Amounts in accumulated other comprehensive loss
Dec. 31,
2020
2019
$
(159,057) $
(1,707)
(188,862)
(1,797)
$
(160,764) $
(190,659)
Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss), pre-tax, consist of the
following (in thousands):
Current year net actuarial gain (loss)
Amortization of previously deferred actuarial loss
Amortization of previously deferred prior service costs
Pension payment timing related charges
Total
2020
2019
2018
$
$
23,597 $
6,207
91
—
29,895 $
(13,060) $
6,123
90
686
(6,161) $
(19,817)
5,124
168
7,498
(7,027)
Pension costs: The following assumptions were used to determine net pension costs:
Discount rate
Expected return on plan assets
2020
3.29%
6.75%
2019
4.34%
6.75%
2018
3.64%
7.00%
The expected return on plan assets assumption was determined based on plan asset allocations, a review of historical capital
market performance, historical plan asset performance and a forecast of expected future plan asset returns.
Benefit obligations and funded status: The following assumptions were used to determine the year-end benefit obligations:
Discount rate
Dec. 31,
2020
2.54%
2019
3.29%
Plan assets: The asset allocation for the TRP as of the end of 2020 and 2019, and target allocations for 2021, by asset
category, are presented in the table below:
Equity securities
Debt securities
Other (including hedge funds and private real estate)
Total
Target Allocation
2021
Allocation of Plan Assets
2020
2019
34 %
63 %
3 %
100 %
47 %
50 %
3 %
100 %
58 %
38 %
4 %
100 %
The primary objective of company-sponsored retirement plans is to provide eligible employees with scheduled pension
benefits. Consistent with standards for preservation of capital and maintenance of liquidity, the goal is to earn the highest
possible total rate of return while minimizing risk. The principal means of reducing volatility and exercising prudent investment
judgment is diversification by asset class and by investment manager; consequently, portfolios are constructed to attain
diversification in the total portfolio, each asset class, and within each individual investment manager’s portfolio. Investment
diversification is consistent with the intent to minimize the risk of large losses. All objectives are based upon an investment
67
horizon spanning five years so that interim market fluctuations can be viewed with the appropriate perspective. The target asset
allocation represents the long-term perspective. Retirement plan assets will be rebalanced periodically to align them with the
target asset allocations. Risk characteristics are measured and compared with an appropriate benchmark quarterly; periodic
reviews are made of the investment objectives and the investment managers. Our actual investment return on our TRP assets
was 23.5% for 2020, 23.6% for 2019 and -5.6% for 2018.
Cash flows: We estimate we will make the following benefit payments from either retirement plan assets or directly from our
funds (in thousands):
2021
2022
2023
2024
2025
2026 through 2030
$
$
$
$
$
$
50,570
40,498
39,639
39,696
40,056
189,061
401(k) savings plan
Substantially all our employees (other than those covered by a collective bargaining agreement) are eligible to participate in
our principal defined contribution plan, The TEGNA 401(k) Savings Plan. Employees can elect to contribute up to 50% of their
compensation to the plan subject to certain limits.
For most participants, the plan’s 2020 matching formula is 100% of the first 4% of employee contributions. We also make
additional employer contributions on behalf of certain long-term employees. Compensation expense related to 401(k)
contributions was $16.5 million in 2020, $14.6 million in 2019 and $13.3 million in 2018. During 2020, we settled the 401(k)
employee company stock match obligation by issuing our common stock from treasury stock and depositing it in the participants’
accounts.
Multi-employer plan
We contribute to the AFTRA Retirement Plan (AFTRA Plan), a multi-employer defined benefit pension plan, under the terms
of collective-bargaining agreements (CBA) that cover certain union-represented employees. The Employee Identification Number
(EIN) and three-digit plan number of the AFTRA Plan is 13-6414972/001.
The AFTRA Plan reports for plan year (December 1, 2018 to November 30, 2019) that the AFTRA Plan was neither in
endangered, critical, or critical and declining status in the Plan Year (e.g. 79% funded). A financial improvement plan or a
rehabilitation plan is neither pending nor has one been implemented for the AFTRA Plan.
We make all required contributions to the AFTRA plan as determined under the respective CBAs. We contributed $2.4 million
annually in 2020, 2019 and 2018. Our contribution to the AFTRA Retirement Plan represented less than 5% of total contributions
to the plan. This calculation is based on the plan financial statements issued for the period ending November 30, 2017.
Expiration dates of the CBAs in place range from April 15, 2021 to October 16, 2022. The AFTRA Plan has elected to utilize
special amortization provisions provided under the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief
Act of 2010.
We incurred no expenses for multi-employer withdrawal liabilities for the years ended December 31, 2020, 2019 and 2018.
NOTE 8 - Leases
We adopted the FASB’s new lease accounting guidance on January 1, 2019. We determine if an arrangement contains a
lease at the agreement’s inception. As permitted under the lease accounting standards adoption guidance, arrangements prior to
the adoption date retained their previous determination as to whether or not an arrangement contained a lease. Arrangements
entered into subsequent to the adoption date of the new guidance have been analyzed to determine if a lease exists depending
on whether there was an identified underlying asset that we control.
Our portfolio of leases primarily consists of leases for the use of corporate offices, station facilities, equipment and for
antenna/transmitter sites. Our lease portfolio consists entirely of operating leases, with most of our leases having remaining
terms ranging 1 to 15 years. Operating lease balances are included in our right-of-use assets for operating leases, other accrued
liabilities and operating lease liabilities on our Consolidated Balance Sheet.
Lease liabilities are calculated as of the lease commencement date based on the present value of lease payments to be
made over the term of the lease. Our lease agreements often contain lease and non-lease components (e.g., common-area
maintenance or other executory costs). We include the non-lease payments in the calculation of our lease liabilities to the extent
they are either fixed or included within the fixed base rental payments. Some of our leases include variable lease components
68
(e.g., rent increases based on the consumer price index) and variable non-lease components, which are expensed as they are
incurred. Such variable costs are not material. The interest rate implicit in our lease contracts is typically not readily determinable.
As a result, we use our estimated incremental borrowing rate in determining the present value of future payments, which reflects
the fixed rate at which we could borrow on a collateralized basis the amount of the lease payments for a similar term.
The operating lease right-of-use asset as of the lease commencement date is calculated based on the amount of the
operating lease liability, less any lease incentive. Some of our lease agreements include options to renew for additional terms or
provide us with the ability terminate the lease early. In determining the term of the lease, we consider whether or not we are
reasonably certain to exercise these options. Lease expense for fixed lease payments is recognized on a straight-line basis over
the lease term.
The following table presents lease related assets and liabilities on the Consolidated Balance Sheets as of December 31,
2020 and 2019 (in thousands):
Dec. 31,
2020
2019
Assets
Right-of-use assets for operating leases
$
97,190 $
103,461
Liabilities
Operating lease liabilities (current)1
Operating lease liabilities (non-current)
Total operating lease liabilities
12,250
99,337
$
111,587 $
11,090
105,902
116,992
(1) Current operating lease liabilities are included within the other accrued liabilities line item of the Consolidated Balance Sheets.
As of December 31, 2020, the weighted-average remaining lease term for our lease portfolio was 9.3 years and the
weighted average discount rate used to calculate the present value of our lease liabilities was 4.9%.
For the year ended December 31, 2020, 2019 and 2018, we recognized lease expense of $18.0 million, $13.9 million, and
$18.5 million respectively. In addition, in 2020 and 2019 we made cash payments for operating leases of $17.1 million and
$11.0 million, respectively, which are included in cash flows from operating activities on Consolidated Statements of Cash Flows.
The table below reconciles future lease payments for each of the next five years and remaining years thereafter, in
aggregate, to the lease liabilities recorded on the Consolidated Balance Sheets as of December 31, 2020 (in thousands):
Future Period
Cash Payments
2021
2022
2023
2024
2025
Thereafter
Total lease payments
Less: amount of lease payments representing interest
Present value of lease liabilities
$
$
17,452
16,994
16,023
14,161
11,892
66,809
143,331
31,744
111,587
As of December 31, 2019, operating lease commitments under lessee arrangements were $15.6 million, $17.0 million, $16.0
million, $14.8 million, and $13.1 million for the years 2020 through 2024, respectively, and $76.0 million thereafter.
NOTE 9 – Fair value measurement
We measure and record certain assets and liabilities at fair value in the accompanying consolidated financial statements.
U.S. GAAP establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between
assumptions based on market data (observable inputs) and our own assumptions (unobservable inputs). The hierarchy consists
of three levels:
Level 1 – Quoted market prices in active markets for identical assets or liabilities;
69
Level 2 – Inputs other than Level 1 inputs that are either directly or indirectly observable; and
Level 3 – Unobservable inputs developed using our own estimates and assumptions, which reflect those that a market
participant would use.
Equity investments in private companies that we do not significantly influence are recorded at cost, less impairments, if any,
plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment. In
2020, we recorded a $9.2 million impairment charge due to the decline in the fair value of one of our investees. The fair value
was determined using a market approach which was based significant inputs not observable in the market, and thus represented
a Level 3 fair value measurement. In 2019 we identified observable price increases, which represents a Level 2 input, for two of
these investments which resulted a total gain of $5.9 million which was recorded in “Other non-operating items, net” in our
Consolidated Statements of Income. No other gains or losses were recorded on these investments in 2019 or 2018.
Prior to the closing of our acquisition in the multicast networks Justice Network and Quest, we held an approximately 15%
ownership interest. Upon completion of the step acquisition, we recognized a gain of $7.3 million in “Other non-operating items,
net” within the Consolidated Statements of Income, for the remeasurement of our previously held ownership interest to fair value,
which was $8.0 million. The fair value was determined using an income approach which was based on significant inputs not
observable in the market, and thus represented a Level 3 fair value measurement.
We additionally hold other financial instruments, including cash and cash equivalents, receivables, accounts payable and
long-term debt. The carrying amounts for cash and cash equivalents, receivables and accounts payable approximated their fair
values due to the short-term nature of these instruments. The fair value of our total long-term debt, determined based on the bid
and ask quotes for the related debt (Level 2), totaled $3.79 billion as of December 31, 2020 and $4.32 billion as of December 31,
2019.
During 2018, we recorded a $2.0 million impairment charge associated with debt investments due to decline in the fair value
of the investee. We also recorded a non-cash impairment charge of $5.8 million in 2017 associated with the write-off of a note
receivable from one of our former equity method investments.
The below fair value tables relate to our TRP pension plan assets (in thousands):
Pension Plan Assets
Fair value measurement as of Dec. 31, 2020
Assets:
Cash and other
Corporate stock
Interest in registered investment companies
Total
Level 1
Level 2
Level 3
Total
$
1,310 $
109,088
71,000
$
181,398 $
— $
—
—
— $
Pension plan investments valued using net asset value as a practical expedient:
Common collective trust - equities
Common collective trust - fixed income
Hedge funds
Partnership/joint venture interests
Total fair value of plan assets
Fair value measurement as of Dec. 31, 2019
Assets:
Cash and other
Corporate stock
Interest in registered investment companies
Total
Level 1
Level 2
Level 3
Total
$
$
1,395 $
111,193
48,221
160,809 $
— $
—
—
— $
— $
—
—
— $
$
$
1,310
109,088
71,000
181,398
96,447
252,426
18,033
4,692
552,996
— $
—
—
— $
$
$
1,395
111,193
48,221
160,809
111,385
185,844
17,125
4,572
479,735
Pension plan investments valued using net asset value as a practical expedient:
Common collective trust - equities
Common collective trust - fixed income
Hedge funds
Partnership/joint venture interests
Total fair value of plan assets
70
Valuation methodologies used for TRP pension assets measured at fair value are as follows:
Corporate stock classified as Level 1 is valued primarily at the closing price reported on the active market on which the
individual securities are traded.
Interest in registered investment companies is valued using the published net asset values as quoted through publicly
available pricing sources. These investments are redeemable on request.
Interest in common/collective trusts are valued using the net asset value as provided monthly by the investment manager or
fund company.
Six of the investments in collective trusts are fixed income funds, whose strategy is to use individual subfunds to efficiently
add a representative sample of securities in individual market sectors to the portfolio. The remaining four investments in
collective trusts held by the Plan are invested in equity funds. The strategy of these funds is to generate returns predominantly
from developed equity markets. These funds are generally redeemable with a short-term written or verbal notice. There are no
unfunded commitments related to these types of funds.
Investments in partnerships are valued at the net asset value of our investment in the fund as reported by the fund managers.
The Plan holds investments in two partnerships. One partnership’s strategy is to generate returns through real estate-related
investments. Certain distributions are received from this fund as the underlying assets are liquidated. The other partnership’s
strategy is to generate returns through investment in developing equity markets. This fund is redeemable with a 30-day notice,
subject to a 0.45% charge. Future funding commitments to our partnership investments totaled $0.7 million as of December 31,
2020 and 2019.
As of December 31, 2020, pension plan assets include one hedge fund which is a fund of hedge funds whose objective is to
produce a return that is uncorrelated with market movements. Investments in hedge funds are valued at the net asset value as
reported by the fund managers. Shares in the hedge fund are generally redeemable twice a year or on the last business day of
each quarter with at least 95 days written notice subject to a potential 5% holdback. There are no unfunded commitments related
to the hedge funds.
We review audited financial statements and additional investor information to evaluate fair value estimates from our
investment managers or fund administrator. Our policy is to recognize transfers between levels at the beginning of the reporting
period. There were no transfers between levels during the period.
NOTE 10 – Shareholders’ equity
As of December 31, 2020, and 2019, our authorized capital was comprised of 800 million shares of common stock and 2
million shares of preferred stock. As of December 31, 2020, shareholders’ equity of TEGNA included 219.5 million shares that
were outstanding (net of 104.9 million shares of common stock held in treasury). As of December 31, 2019, shareholders’ equity
of TEGNA included 217.5 million shares that were outstanding (net of 107.0 million shares of common stock held in treasury). No
shares of preferred stock were issued and outstanding as of December 31, 2020, or 2019.
Capital stock and earnings per share
We report earnings per share on two bases, basic and diluted. All basic income per share amounts are based on the
weighted average number of common shares outstanding during the year. The calculation of diluted earnings per share also
considers the assumed dilution from the issuance of performance shares and restricted stock units and exercise of stock options.
71
Our earnings per share (basic and diluted) for 2020, 2019, and 2018 are presented below (in thousands, except per share
amounts):
Net income
Income from discontinued operations, net of tax
Net loss attributable to noncontrolling interest
Accretion of redeemable noncontrolling interest (See Note 12)
Adjustment of redeemable noncontrolling interest to redemption value
Earnings available to common shareholders
$
481,830 $
2020
2019
2018
$
482,763 $
—
286,235 $
—
401,340
4,325
15
(933)
(15)
—
—
—
—
—
286,235 $
—
405,665
Weighted average number of common shares outstanding - basic
Effect of dilutive securities
Restricted stock
Performance share units
Stock options
Weighted average number of common shares outstanding - diluted
Earnings from continuing operations per share - basic
Earnings from discontinued operations per share - basic
Earnings per share - basic
Earnings from continuing operations per share - diluted
Earnings from discontinued operations per share - diluted
Earnings per share - diluted
219,232
217,138
216,184
246
254
1
219,733
461
346
32
217,977
139
97
201
216,621
$
$
$
$
2.20 $
—
2.20 $
2.19 $
—
2.19 $
1.32 $
—
1.32 $
1.31 $
—
1.31 $
1.86
0.02
1.88
1.85
0.02
1.87
Our calculation of diluted earnings per share includes the dilutive effects for the assumed vesting of outstanding restricted
stock units and performance share units.
Share repurchase program
In December 2020, our Board of Directors authorized the renewal of our share repurchase program for up to $300.0 million
of our common stock over the next three years. The shares may be repurchased at management’s discretion, either in the open
market or in privately negotiated block transactions. Management’s decision to repurchase shares will depend on price and other
corporate needs. Purchases may occur from time to time and no maximum purchase price has been set. The program was
previously suspended on March 20, 2019 simultaneously with the announcement of our acquisition of the Nexstar-Tribune
divestiture stations to prioritize use of cash for debt repayment associated with those acquisitions. During 2020 and 2019, no
shares were repurchased. In 2018, 0.5 million shares were purchased for $5.8 million. Certain of the shares we previously
acquired have been reissued in settlement of employee stock awards.
Stock-Based Compensation Plans
In May 2001, our shareholders approved the adoption of the 2001 Omnibus Incentive Compensation Plan. This plan was
amended and restated as of May 4, 2010, to increase the number of shares reserved for issuance to 60.0 million shares of our
common stock. In April 2020, our shareholders approved the adoption of the 2020 Omnibus Incentive Compensation Plan (the
Plan). The Plan reserved the issuance of an additional 20.0 million shares or our common stock. The Plan provides for the
granting of stock options, stock appreciation rights, restricted stock, restricted stock units (RSUs), performance share units,
performance share awards, and other equity-based and cash-based awards. Awards may be granted to our employees and
members of the Board of Directors. The Plan provides that shares of common stock subject to awards granted become available
again for issuance if such awards are canceled or forfeited.
Performance share program - The Leadership Development and Compensation Committee (LDCC) of the Board of Directors
has established a long-term incentive performance share program for our executives under the Plan. The number of shares
earned under the performance share awards (PSAs) program is determined based on the achievement of certain financial
performance criteria (adjusted EBITDA and free cash flow as defined by the PSA agreement) over a two-year cumulative
financial performance period. If the financial performance criteria are met and certified by the LDCC, the shares earned under the
PSA will be subject to an additional one year service period before the common stock is released to the employees. The PSAs
do not pay dividends or allow voting rights during the three-year incentive period. Therefore, the fair value of the PSA is the
quoted market value of our stock on the grant date less the present value of the expected dividends not received during the
relevant performance period. The PSA provides the LDCC with limited discretion to make adjustments to the financial targets to
ensure consistent year-to-year comparison for the performance criteria. For expense recognition, in the period it becomes
72
probable that the minimum performance criteria specified in the PSA will be achieved, we recognize expense, net of estimated
forfeitures, for the proportionate share of the total fair value of the shares subject to the PSA related to the vesting period that has
already lapsed. Each reporting period during the two-year performance period, we adjust the fair value of the PSAs to the quoted
market value of our stock price. In the event we determine it is no longer probable that we will achieve the minimum performance
criteria specified in the PSA, we reverse all of the previously recognized compensation expense in the period such a
determination is made.
RSU program - We also issue stock-based compensation to employees in the form of RSUs. These awards generally entitle
employees to receive at the end of a specified vesting period one share of common stock for each RSU granted, conditioned on
continued employment for the relevant vesting period. RSUs granted since 2016 vest 25% per year and settle annually. RSUs do
not pay dividends or confer voting rights in respect of the underlying common stock during the vesting period. RSUs are valued
based on the fair value of our common stock on the date of grant less the present value of the expected dividends not received
during the relevant vesting period. The fair value of the RSU, less estimated forfeitures, is recognized as compensation expense
ratably over the vesting period.
Total shareholder return program - Prior to 2018, senior executives participated in a performance share award plan (PSU) in
which the number of shares that an executive receives is determined based upon how our total shareholder return (TSR)
compares to the TSR of a peer group of companies during the three-year period. For this PSU award, we recognized the grant
date fair value of each PSU, less estimated forfeitures, as compensation expense ratably over the incentive period. Fair value
was determined by using a Monte Carlo valuation model. Each PSU is equal to and paid in one share of our common stock, but
carries no voting or dividend rights. The number of shares ultimately issued for each PSU award may range from 0% to 200% of
the award’s target. No PSUs were granted in 2020, 2019, and 2018.
We generally grant both RSUs and performance share awards annually to employees on March 1.
Stock-based Compensation Expense: The following table shows the stock-based compensation related amounts
recognized in the Consolidated Statements of Income for equity awards pertaining to continuing operations (in thousands):
RSUs
PSAs
PSUs
Total stock-based compensation
Total income tax benefit (provision)
2020
2019
2018
$
11,686 $
8,620
—
20,306
4,297
9,699 $
9,277
1,170
20,146
4,354
7,260
2,693
2,578
12,531
(184)
Stock-based compensation net of tax
$
16,009 $
15,792 $
12,715
RSUs: As of December 31, 2020, there was $22.2 million of unrecognized compensation cost related to non-vested restricted
stock and RSUs. This amount will be adjusted for future changes in estimated forfeitures and recognized on a straight-line basis
over a weighted average period of 2.5 years.
A summary of RSU awards is presented below:
RSU Activity
Unvested at beginning of year
Granted
Vested
Canceled
Unvested at end of year
2020
2019
2018
Shares
Weighted
average
fair value
Shares
Weighted
average
fair value
2,132,936 $
1,416,300
(738,159)
(196,423)
2,614,654 $
13.22
13.39
14.03
13.14
13.09
1,567,704 $
1,356,848
(581,479)
(210,137)
2,132,936 $
14.65
13.09
16.31
14.53
13.22
Shares
1,062,550 $
1,198,787
(477,050)
(216,583)
1,567,704 $
Weighted
average
fair value
21.29
11.99
15.11
17.98
14.65
73
PSAs: The PSAs were first granted in 2018. A summary for the PSAs activity is presented below:
PSAs Activity
Unvested at beginning of year
Granted
Vested
Canceled
Unvested at end of year
2020
2019
2018
Target
number of
shares
Weighted
average fair
value
Target
number of
shares
Weighted
average fair
value
Target
number of
shares
Weighted
average fair
value
698,482 $
673,127
(151,511)
(77,219)
1,142,879 $
12.26
13.47
13.40
12.50
12.87
450,085 $
567,356
(261,286)
(57,673)
698,482 $
12.05
12.36
12.16
12.08
12.26
— $
565,187
(91,451)
(23,651)
450,085 $
—
12.05
12.05
12.05
12.05
PSUs: As of December 31, 2019, there was no unrecognized compensation cost related to non-vested PSUs as the last
awards fully vested as of December 31, 2019.
A summary of our PSUs is presented below:
PSUs Activity
Unvested at beginning of year
Granted
Vested
Canceled
Unvested at end of year
2019
2018
Target
number of
shares
Weighted
average fair
value
Target
number of
shares
Weighted
average fair
value
250,840 $
23.92
662,835 $
25.87
—
(228,287)
(22,553)
—
23.92
23.92
—
(383,095)
(28,900)
— $
—
250,840 $
—
27.19
25.39
23.92
Accumulated other comprehensive loss
The elements of our Accumulated Other Comprehensive Loss (AOCL) principally consisted of pension, retiree medical and
life insurance liabilities and foreign currency translation. The following tables summarize the components of, and changes in
AOCL, net of tax (in thousands):
2020
Balance at beginning of year
Other comprehensive gain before reclassifications
Amounts reclassified from AOCL
Balance at end of year
2019
Balance at beginning of year
Other comprehensive (loss) income before reclassifications
Amounts reclassified from AOCL
Balance at end of year
Retirement
Plans
Foreign
Currency
Translation (1)
$
$
(142,398) $
16,779
4,640
(120,979) $
(199) $
102
—
(97) $
Total
(142,597)
16,881
4,640
(121,076)
Retirement
Plans
Foreign
Currency
Translation (1)
$
(136,893) $
(10,339)
4,834
(142,398) $
$
382 $
(581)
—
(199) $
Total
(136,511)
(10,920)
4,834
(142,597)
74
Retirement
Plans
Foreign
Currency
Translation (1)
2018
Balance at beginning of year
Other comprehensive income (loss) before reclassifications
Amounts reclassified from AOCL
Total other comprehensive income
Reclassification of stranded tax effects to retained earnings
Balance at end of year
(1) Our entire foreign currency translation adjustment is related to our CareerBuilder investment. We record our share of foreign currency
translation adjustments through our equity method investment.
(107,037) $
(14,450)
9,439
(5,011) $
(24,845)
(136,893) $
114 $
268
—
382 $
268 $
Total
(106,923)
(14,182)
9,439
(4,743)
(24,845)
(136,511)
—
$
$
$
AOCL components are included in the computation of net periodic post-retirement costs which include pension costs
discussed in Note 7 and our other post-retirement benefits (health care and life insurance benefits). Reclassifications out of
AOCL related to these post-retirement plans included the following (in thousands):
Amortization of prior service (credit) cost
Amortization of actuarial loss
Pension payment timing related charges
Total reclassifications, before tax
Income tax effect
Total reclassifications, net of tax
2020
2019
2018
$
(481) $
(481) $
6,690
—
6,209
(1,569)
4,640 $
6,246
686
6,451
(1,617)
4,834 $
$
(403)
5,544
7,498
12,639
(3,200)
9,439
NOTE 11 – Spectrum repacking reimbursements and other, net
As events occur, or circumstances change, we may recognize non-cash impairment charges to reduce the book value of
goodwill, other intangible assets and other long-lived assets or to record charges (gains) related to spectrum repacking
reimbursements and other efforts, or unique events.
A summary of these items by year (pre-tax basis) is presented below (in thousands):
Reimbursement of spectrum repacking
Property and equipment gains
Intangible asset impairments and other charges
Contract termination and other costs related to national sales
Lease exit and other charges
Hurricane-related losses, net
2020
2019
2018
$
(13,180) $
—
3,225
—
—
—
(16,974) $
(2,880)
9,063
5,456
—
—
(7,400)
(5,989)
—
—
551
1,137
Total spectrum repacking reimbursements and other, net
$
(9,955) $
(5,335) $
(11,701)
Reimbursement of spectrum repacking: Some of our stations have had to purchase new equipment in order to comply with
the FCC spectrum repacking initiative. As part of this initiative, the FCC is reimbursing companies for costs incurred to comply
with the new requirements. In 2020, 2019 and 2018, we received $13.2 million, $17.0 million, $7.4 million of such
reimbursements, which we have recorded as contra expense.
Property and equipment gains: In 2019, we recognized a $2.9 million gain related to sale of one of our real estate properties.
In 2018, we recognized a $6.0 million gain as a result of the sale of real estate in Houston, Texas.
Intangible asset impairments and other charges: In 2020, as a result of our annual impairment analysis we determined that a
radio FCC license experienced a decline in value which resulted in a $1.1 million impairment charge. In the second quarter of
2020, we recognized a $2.1 million impairment charge in connection with eliminating the use of the Justice Network brand name
and re-establishing the business under a new brand name called True Crime Network. In 2019, we recognized $9.1 million of
impairment charges, related to assets classified as held-for sale.
Contract termination and other costs related to national sales: This expense is comprised of a contract termination and other
incremental transition costs related to bringing our national sales organization in-house (which occurred during the third quarter
of 2019). Prior to this transition we utilized a third party national marketing representation firm for our national television
advertising.
75
Lease exit and other charges: In 2018 we incurred charges related to exiting a lease used by our former Cofactor business,
which operated within our former Digital segment.
Hurricane related losses, net: In 2018 we recognized losses of $1.1 million related to hurricane damage.
NOTE 12 – Other matters
Litigation: In the third quarter of 2018, certain national media outlets reported the existence of a confidential investigation by
the United States Department of Justice Antitrust Division (DOJ) into the local television advertising sales practices of station
owners. We received a Civil Investigative Demand (CID) in connection with the DOJ’s investigation. On November 13 and
December 13, 2018, the DOJ and seven broadcasters settled a DOJ complaint alleging the exchange of competitively sensitive
information in the broadcast television industry. In June 2019, we and four other broadcasters entered into a substantially
identical agreement with DOJ, which was entered by the court on December 3, 2019. The settlement contains no finding of
wrongdoing or liability and carries no penalty. It prohibits us and the other settling entities from sharing certain confidential
business information, or using such information pertaining to other broadcasters, except under limited circumstances. The
settlement also requires the settling parties to make certain enhancements to their antitrust compliance programs, to continue to
cooperate with the DOJ’s investigation, and to permit DOJ to verify compliance. We do not expect the costs of compliance to be
material.
Since the national media reports, numerous putative class action lawsuits were filed against owners of television stations (the
Advertising Cases) in different jurisdictions. Plaintiffs are a class consisting of all persons and entities in the United States who
paid for all or a portion of advertisement time on local television provided by the defendants. The Advertising Cases assert
antitrust and other claims and seek monetary damages, attorneys’ fees, costs and interest, as well as injunctions against the
allegedly wrongful conduct.
These cases have been consolidated into a single proceeding in the United States District Court for the Northern District of
Illinois, captioned Clay, Massey & Associates, P.C. v. Gray Television, Inc. et. al., filed on July 30, 2018. At the court’s direction,
plaintiffs filed an amended complaint on April 3, 2019, that superseded the original complaints. Although we were named as a
defendant in sixteen of the original complaints, the amended complaint did not name TEGNA as a defendant. After TEGNA and
four other broadcasters entered into consent decrees with the DOJ in June 2019, the plaintiffs sought leave from the court to
further amend the complaint to add TEGNA and the other settling broadcasters to the proceeding. The court granted the plaintiffs’
motion, and the plaintiffs filed the second amended complaint on September 9, 2019. On October 8, 2019, the defendants jointly
filed a motion to dismiss the matter. On November 6, 2020, the court denied the motion to dismiss. We deny any violation of law,
believe that the claims asserted in the Advertising Cases are without merit, and intend to defend ourselves vigorously against
them.
We, along with a number of our subsidiaries, also are defendants in other judicial and administrative proceedings involving
matters incidental to our business. We do not believe that any material liability will be imposed as a result of any of the foregoing
matters.
Commitments: The following table summarizes the expected cash outflow related to our commitments related to license
broadcast agreements that are not recorded on our balance sheet as of December 31, 2020. Such obligations include future
payments related to our programming contracts (in thousands). See Note 8 for further information on our lease commitments.
We have $2.20 billion of commitments under programming contracts that include syndicated television station commitments to
purchase programming to be produced in future years. This also includes amounts related to our network affiliation agreements.
Certain network affiliation agreements include variable fee components such as a rate per number of subscribers, which in have
been estimated based on current subscriber levels and reflected in the table below.
2021
2022
2023
2024
2025
Thereafter
Total
Programming
Contracts
$
$
810,069
847,218
536,785
1,981
404
—
2,196,457
Major Customers: Customers that purchase our advertising and marketing services are comprised of local, regional, and
national advertisers across our markets. Our subscription revenue customers include cable operators and satellite providers for
carriage of our television stations. In 2020, one customer purchased both advertising and marketing services and paid us
compensation related to retransmission consent agreements, which payments in the aggregate represented more than 10% of
consolidated revenues in 2020. This customer represented $393.4 million of consolidated revenue in fiscal year ended
76
December 31, 2020. In prior years we had two major customers that purchased more than 10% of our revenue with $270.3
million and $251.2 million in 2019, and $245.3 million and $223.8 million in 2018 of consolidated revenue.
Related Party Transactions: We have an equity and debt investment in MadHive, Inc. (MadHive) which is a related party of
TEGNA. In addition to our investment, we also have a commercial agreement with MadHive where they support our Premion
business in acquiring and delivering over-the-top ad impressions. During the year ended December 31, 2020, we incurred
expenses of $55.1 million as a result of the commercial agreement with MadHive. During the year ended December 31, 2019, we
incurred $34.3 million of expenses under the commercial agreement. These expenses are recorded as “Cost of revenue” on our
Consolidated Statements of Income. As of December 31, 2020 and December 31, 2019, we had accounts payable and accrued
liabilities associated with the commercial agreement of $13.5 million and $4.3 million, respectively.
Sale of minority ownership interest in Premion: On March 2, 2020, we sold a minority ownership interest in Premion, LLC
(Premion) for $14.0 million to an affiliate of Gray Television (Gray). In connection with that transaction, Premion and Gray entered
into a commercial arrangement under which Gray resells Premion services across all of Gray’s 93 television markets. Our
TEGNA stations and Gray each have the right to independently sell Premion’s inventory in markets where we both operate a
local television station. The sale of spot television advertising is not part of this agreement, and Gray and our TEGNA stations
continue to sell spot advertising for our respective stations without any involvement from the other party.
In connection with acquiring a minority interest, Gray has the right to sell its interest to Premion if there is a change in control
of TEGNA or if the commercial reselling agreement terminates. Since redemption of the minority ownership interest is outside our
control, Gray’s equity interest is presented outside of the Equity section on the Consolidated Balance Sheet in the caption
“Redeemable noncontrolling interest.” On the date of sale, we recorded a $14.0 million redeemable noncontrolling interest on the
Consolidated Balance Sheet in connection with Gray’s investment. When the redemption value or the carrying value (the
acquisition date fair value adjusted for the noncontrolling interest’s share of net income (loss) and dividends) is less than the
redemption value, we adjust the redeemable noncontrolling interest to equal the redemption value with changes recognized as
an adjustment to retained earnings. Any such adjustment, when necessary, will be performed as of the applicable balance sheet
date.
FCC Broadcast Spectrum Program: In April 2017, the FCC announced the completion of a voluntary incentive auction to
reallocate certain spectrum then occupied by television broadcast stations to mobile wireless broadband services, along with a
related “repacking” of the television spectrum for remaining television stations. None of our stations relinquished any spectrum
rights as a result of the auction. Stations in eighteen of our markets (including one station we acquired post-repack in 2020) were
repacked to new channels. All of our repacked stations have completed their transitions to their new channels.
The legislation authorizing the incentive auction and repacking established a $1.75 billion fund for reimbursement of costs
incurred by stations required to change channels in the repacking. Subsequent legislation enacted on March 23, 2018,
appropriated an additional $1 billion for the repacking fund, of which up to $750 million may be made available to repacked full
power and Class A television stations and multichannel video programming distributors. Other funds are earmarked to assist
affected low power television stations, television translator stations, and FM radio stations, as well for consumer education
efforts. On October 7, 2020, the FCC announced that all final invoices and supporting documentation for reimbursement
requests will be due no later than (1) October 8, 2021, for full power and Class A TV stations that transitioned in Phase 5 or
earlier; (2) March 22, 2022, for full power and Class A TV stations that transitioned in Phase 6 or later; and (3) September 5,
2022, for all other entities entitled to seek repacking-related reimbursements (including low power television stations and
television translator stations). By law, the repacking reimbursement program will end July 3, 2023, at which point any remaining
unobligated funds will be returned to the U.S. Treasury.
A majority of our capital expenditures in connection with the repack occurred in 2018 and 2019. To date, we have incurred
approximately $42.0 million in capital expenditures for the spectrum repack project. We have received FCC reimbursements of
approximately $37.6 million through December 31, 2020. The reimbursements were recorded as a contra operating expense
within our Spectrum repacking reimbursements and other, net line item on our Consolidated Statements of Income and reported
as an investing inflow on the Consolidated Statements of Cash Flows. We expect to receive reimbursements for the remaining
$4.4 million of our spend upon completion of the FCC’s reimbursement review process.
77
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our principal executive officer and principal
financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule
13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the Exchange Act). Based on this evaluation,
our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were
effective as of December 31, 2020, the end of the period covered by this annual report.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such
term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including
our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal
control over financial reporting based on the framework in Internal Control - Integrated Framework (2013 framework) issued by
the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation, our management concluded
that our internal control over financial reporting was effective as of December 31, 2020.
The effectiveness of our internal control over financial reporting as of December 31, 2020, has been audited by
PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in its report which is included herein.
Changes in Internal Control Over Financial Reporting
There have been no material changes in our internal controls or in other factors during our fiscal quarter ended December 31,
2020, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
ITEM 9B. OTHER INFORMATION
None.
78
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information captioned “Your Board of Directors,” “The TEGNA Nominees,” “Committees of the Board of Directors,”
“Committee Charters” and “Ethics Policy” under the heading “Proposal 1 – Election of Directors” in our 2021 proxy statement is
incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The information captioned “Executive Compensation,” “Director Compensation,” “Outstanding Director Equity Awards at
Fiscal Year-End” AND “Proposal 1–Election of Directors – Related Transactions” in our 2021 proxy statement is incorporated
herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
The information captioned “Equity Compensation Plan Information” and “Securities Beneficially Owned by Directors,
Executive Officers and Principal Shareholders” in our 2021 proxy statement is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information captioned “Director Nominees” under the heading “2021 Proxy Statement Summary: Snapshot of 2021
Director Nominees” and “Related Transactions” under the heading “Proposal 1 - Election of Directors” in our 2021 proxy
statement is incorporated herein by reference.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information captioned “Report of the Audit Committee” in our 2021 proxy statement is incorporated herein by reference.
79
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Financial Statements, Financial Statement Schedules and Exhibits.
(1)
Financial Statements.
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Comprehensive Income
Consolidated Statements of Cash Flows
Consolidated Statements of Equity and Redeemable Noncontrolling Interest
Notes to Consolidated Financial Statements
(2)
Financial Statement Schedules.
All schedules are omitted as the required information is not applicable or the information is presented in the consolidated
financial statements or related notes.
(3) Exhibits.
80
EXHIBIT INDEX
Exhibit Number
Exhibit
Location
3-1
3-1-1
3-1-2
3-2
4-1
4-2
4-3
4-4
4-5
4-6
4-7
4-8
4-9
10-1
10-1-1
10-1-2
10-1-3
10-2
10-2-1
10-2-2
Third Restated Certificate of Incorporation of TEGNA Inc.
Incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended April 1, 2007.
Amendment to Third Restated Certificate of Incorporation
of TEGNA Inc.
Incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s
Form 8-K filed on May 1, 2015.
Amendment to Third Restated Certificate of Incorporation
of TEGNA Inc.
Incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s
Form 8-K filed on July 2, 2015.
By-laws, as amended through July 24, 2018.
Incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s
Form 8-K filed on July 27, 2018.
Indenture dated as of March 1, 1983, between TEGNA Inc.
and Citibank, N.A., as Trustee.
Incorporated by reference to Exhibit 4-1 to TEGNA Inc.’s
Form 10-K for the fiscal year ended December 31, 2017.
First Supplemental Indenture dated as of November 5,
1986, among TEGNA Inc., Citibank, N.A., as Trustee, and
Sovran Bank, N.A., as Successor Trustee.
Incorporated by reference to Exhibit 4-2 to TEGNA Inc.’s
Form 10-K for the fiscal year ended December 31, 2017.
Second Supplemental Indenture dated as of June 1, 1995,
among TEGNA Inc., NationsBank, N.A., as Trustee, and
Crestar Bank, as Trustee.
Incorporated by reference to Exhibit 4-3 to TEGNA Inc.’s
Form 10-K for the fiscal year ended December 31, 2017.
Tenth Supplemental Indenture, dated as of July 29, 2013,
between TEGNA Inc. and U.S. Bank National Association,
as Trustee.
Eleventh Supplemental Indenture, dated as of October 3,
2013, between TEGNA Inc. and U.S. Bank National
Association as Trustee.
Incorporated by reference to Exhibit 4-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2017.
Incorporated by reference to Exhibit 4-8 to TEGNA Inc.’s
Form 10-K for the fiscal year ended December 29, 2013.
Thirteenth Supplemental Indenture, dated as of September
13, 2019, between TEGNA Inc. and U.S. Bank National
Association, as Trustee.
Incorporated by reference to Exhibit 4-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 30,
2019.
Fourteenth Supplemental Indenture, dated as of January 9,
2020, between TEGNA Inc. and U.S. Bank National
Association, as Trustee.
Incorporated by reference to Exhibit 4-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 31, 2020.
Fifteenth Supplemental Indenture, dated as of September
10, 2020, between TEGNA Inc. and U.S. Bank National
Association, as Trustee.
Incorporated by reference to Exhibit 4-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 30,
2020.
Description of Securities.
Incorporated by reference to Exhibit 4-7 to TEGNA Inc.’s
Form 10-K for the fiscal year ended December 31, 2019.
Supplemental Executive Medical Plan Amended and
Restated as of January 1, 2011.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-K for the fiscal year ended December 26, 2010.
Amendment No. 1 to the Supplemental Executive Medical
Plan Amended and Restated as of January 1, 2012.*
Incorporated by reference to Exhibit 10-1-1 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 30,
2012.
Amendment No. 2 to the TEGNA Inc. Supplemental
Executive Medical Plan dated as of June 26, 2015.*
Incorporated by reference to Exhibit 10-6 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 28, 2015.
Amendment No. 3 to the TEGNA Inc. Supplemental
Executive Medical Plan effective as of November 1, 2016.*
Incorporated by reference to Exhibit 10-1-3 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 30,
2016.
Supplemental Executive Medical Plan for Retired
Executives dated December 22, 2010 and effective
January 1, 2011.*
Incorporated by reference to Exhibit 10-2-1 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 26,
2010.
Amendment No. 1 to the TEGNA Inc. Supplemental
Executive Medical Plan for Retired Executives dated as of
June 26, 2015.*
Incorporated by reference to Exhibit 10-7 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 28, 2015.
Amendment No. 2 to the TEGNA Inc. Supplemental
Executive Medical Plan for Retired Executives effective as
of November 1, 2016.*
Incorporated by reference to Exhibit 10-2-2 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 30,
2016.
10-3
TEGNA Inc. Supplemental Retirement Plan Restatement.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 30,
2007.
81
Exhibit Number
Exhibit
Location
10-3-1
10-3-2
10-3-3
10-3-4
10-3-5
10-4
10-4-1
10-4-2
10-4-3
10-4-4
10-4-5
10-4-6
10-4-7
10-4-8
10-4-9
10-4-10
10-4-11
10-5
10-5-1
10-5-2
10-5-3
Amendment No. 1 to the TEGNA Inc. Supplemental
Retirement Plan dated July 31, 2008 and effective August
1, 2008.*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 28,
2008.
Amendment No. 2 to the TEGNA Inc. Supplemental
Retirement Plan dated December 22, 2010.*
Incorporated by reference to Exhibit 10-3-2 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 26,
2010.
Amendment No. 3 to the TEGNA Inc. Supplemental
Retirement Plan dated as of June 26, 2015.*
Incorporated by reference to Exhibit 10-8 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 28, 2015.
Amendment No. 4 to the TEGNA Inc. Supplemental
Retirement Plan dated as of November 7, 2017.*
Incorporated by reference to Exhibit 10-3-4 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2017.
Amendment No. 5 to the TEGNA Inc. Supplemental
Retirement Plan, dated as of April 26, 2018.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2018.
TEGNA Inc. Deferred Compensation Plan Restatement
dated February 1, 2003 (reflects all amendments through
July 25, 2006).*
Incorporated by reference to Exhibit 10-4 to TEGNA Inc.’s
Form 10-K for the fiscal year ended December 31, 2006.
TEGNA Inc. Deferred Compensation Plan Rules for
Post-2004 Deferrals.*
Incorporated by reference to Exhibit 10-3 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended July 1, 2007.
Amendment No. 1 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals dated
July 31, 2008 and effective August 1, 2008.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 28,
2008.
Amendment No. 2 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals dated
December 9, 2008.*
Incorporated by reference to Exhibit 10-4-3 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 28,
2008.
Amendment No. 3 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals dated
October 27, 2009.*
Incorporated by reference to Exhibit 10-4-4 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 27,
2009.
Amendment No. 4 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals dated
December 22, 2010.*
Incorporated by reference to Exhibit 10-4-5 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 26,
2010.
Amendment No. 5 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals dated as
of June 26, 2015.*
Incorporated by reference to Exhibit 10-10 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 28,
2015.
Amendment No. 6 to the TEGNA Inc. Deferred
Compensation Plan Rues for Post-2004 Deferrals dated as
of December 8, 2015.*
Incorporated by reference to Exhibit 10-4-7 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2015.
Amendment No. 7 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals, dated
as of May 3, 2017.*
Incorporated by reference to Exhibit 10-11 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 30,
2017.
Amendment No. 8 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals, dated
as of November 7, 2017.*
Incorporated by reference to Exhibit 10-4-9 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2017.
Amendment No. 9 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals, dated
as of April 26, 2018.*
Incorporated by reference to Exhibit 10-4 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2018.
Amendment No. 10 to the TEGNA Inc. Deferred
Compensation Plan Rules for Post-2004 Deferrals, dated
as of November 16, 2018.*
Incorporated by reference to Exhibit 10-4-11 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2018.
Amendment to the TEGNA Inc. Deferred Compensation
Plan Restatement Rules for Pre-2005 Deferrals dated as of
June 26, 2015.*
Incorporated by reference to Exhibit 10-9 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 28, 2015.
Amendment No. 2 to the TEGNA Inc. Deferred
Compensation Plan Restatement Rules for Pre-2005
Deferrals, dated as of May 3, 2017.*
Incorporated by reference to Exhibit 10-12 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 30,
2017.
Amendment No. 3 to the TEGNA Inc. Deferred
Compensation Plan Restatement Rules for Pre-2005
Deferrals, dated as of April 26, 2018.*
Incorporated by reference to Exhibit 10-3 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30 2018.
Amendment No. 4 to the TEGNA Inc. Deferred
Compensation Plan Restatement Rules for Pre-2005
Deferrals, dated as of November 16 , 2018.*
Incorporated by reference to Exhibit 10-5-3 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2018.
82
10-6-1
10-6-2
10-6-3
10-6-4
10-7
10-7-1
10-7-2
10-7-3
10-7-4
10-7-5
10-8
10-9
Exhibit Number
Exhibit
Location
10-6
TEGNA Inc. Transitional Compensation Plan Restatement.*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 30,
2007.
Amendment No. 1 to TEGNA Inc. Transitional
Compensation Plan Restatement dated as of May 4, 2010.*
Incorporated by reference to Exhibit 10-3 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 28, 2010.
Amendment No. 2 to TEGNA Inc. Transitional
Compensation Plan Restatement dated as of December
22, 2010.*
Incorporated by reference to Exhibit 10-5-2 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 26,
2010.
Amendment No. 3 to TEGNA Inc. Transitional
Compensation Plan Restatement dated as of June 26,
2015.*
Incorporated by reference to Exhibit 10-11 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 28,
2015.
Notice to Transitional Compensation Plan Restatement
Participants.*
Incorporated by reference to Exhibit 10-6-4 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2015.
TEGNA Inc. 2001 Omnibus Incentive Compensation Plan,
as amended and restated as of May 4, 2010.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 28, 2010.
Amendment No. 1 to the TEGNA Inc. 2001 Omnibus
Incentive Compensation Plan (Amended and Restated as
of May 4, 2010).*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 8-K filed on February 25, 2015.
Amendment No. 2 to the TEGNA Inc. 2001 Omnibus
Incentive Compensation Plan (Amended and Restated as
of May 4, 2010) dated as of June 26, 2015.*
Incorporated by reference to Exhibit 10-12 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 28,
2015.
Amendment No. 3 to the TEGNA Inc. 2001 Omnibus
Incentive Compensation Plan (Amended and Restated as
of May 4, 2010) dated as of February 23, 2016.*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 8-K filed on February 26, 2016.
Amendment No. 4 to the TEGNA Inc. 2001 Omnibus
Incentive Compensation Plan (Amended and Restated as
of May 4, 2010) effective as of November 1, 2016.*
Incorporated by reference to Exhibit 10-7-4 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 30,
2016.
Amendment No. 5 to the TEGNA Inc. 2001 Omnibus
Incentive Compensation Plan (Amended and Restated as
of May 4, 2010), dated as of May 3, 2017.*
Incorporated by reference to Exhibit 10-10 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 30,
2017.
TEGNA Inc. 2020 Omnibus Incentive Compensation Plan.
Form of Director Stock Option Award Agreement.*
10-10
Form of Director Restricted Stock Unit Award Agreement.*
10-10-1
Form of Director Restricted Stock Unit Award Agreement.*
10-10-2
Form of Director Restricted Stock Unit Award Agreement.*
Incorporated by reference to Appendix B to TEGNA Inc.’s
Definitive Proxy Statement on Schedule 14A filed on
March 25, 2020.
Incorporated by reference to Exhibit 10-7-3 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 30,
2007.
Incorporated by reference to Exhibit 10-5 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2018.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2019.
Incorporated by reference to Exhibit 10-4 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2020.
10-11
10-11-1
10-11-2
10-11-3
10-11-4
10-11-5
Form of Executive Officer Restricted Stock Unit Award
Agreement.*
Incorporated by reference to Exhibit 10-3-2 to TEGNA
Inc.’s Form 8-K filed on December 11, 2015.
Form of Executive Officer Restricted Stock Unit Award
Agreement.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.'s
Form 10-Q for the fiscal quarter ended March 31, 2017.
Form of Executive Officer Restricted Stock Unit Award
Agreement.*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 31, 2018.
Form of Executive Officer Restricted Stock Unit Award
Agreement.*
Incorporated by reference to Exhibit 10-7-18 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2018.
Form of Executive Officer Restricted Stock Unit Award
Agreement.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 31, 2019.
Form of Executive Officer Restricted Stock Unit Award
Agreement.*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 31, 2020.
83
Exhibit Number
Exhibit
Location
10-11-6
10-12
10-12-1
10-12-2
10-12-3
10-12-4
10-12-5
10-12-6
10-13
10-14
10-15
10-15-1
10-16
10-16-1
10-16-2
10-17
10-18
10-19
10-19-1
Form of Executive Officer Restricted Stock Unit Award
Agreement.*
Incorporated by reference to Exhibit 10-3 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2020.
Form of Executive Officer Performance Share Award
Agreement.*
Incorporated by reference to Exhibit 10-3-3 to TEGNA
Inc.’s Form 8-K filed on December 11, 2015.
Form of Executive Officer Performance Share Award
Agreement.*
Incorporated by reference to Exhibit 10-3 to TEGNA Inc.'s
Form 10-Q for the fiscal quarter ended March 31, 2017.
Form of Executive Officer Performance Share Award
Agreement.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 31, 2018.
Form of Executive Officer Performance Share Award
Agreement.*
Incorporated by reference to Exhibit 10-7-25 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2018.
Form of Executive Officer Performance Share Award
Agreement.*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 31, 2019.
Form of Executive Officer Performance Share Award
Agreement.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 31, 2020.
Form of Executive Officer Performance Share Award
Agreement.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2020.
Description of TEGNA Inc.’s Non-Employee Director
Compensation.*
Amendment for Section 409A Plans dated December 31,
2008.*
Executive Life Insurance Plan document dated December
31, 2008.*
Amendment No. 1 to the TEGNA Inc. Executive Life
Insurance Plan Document dated as of June 26, 2015.*
Incorporated by reference to Exhibit 10-15 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 28,
2015.
Incorporated by reference to Exhibit 10-14 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 28,
2008.
Incorporated by reference to Exhibit 10-15 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 28,
2008.
Incorporated by reference to Exhibit 10-13 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 28,
2015.
Key Executive Life Insurance Plan dated October 29,
2010.*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 26,
2010.
Amendment No. 1 to the TEGNA Inc. Key Executive Life
Insurance Plan dated as of June 26, 2015.*
Incorporated by reference to Exhibit 10-14 to TEGNA
Inc.’s Form 10-Q for the fiscal quarter ended June 28,
2015.
Form of Participation Agreement under Key Executive Life
Insurance Plan.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 26,
2010.
Omnibus Amendment to Terms and Conditions of Stock
Option Awards dated as of December 31, 2008.*
Omnibus Amendment to Outstanding Award Agreements of
Certain Executives effective as of November 1, 2016.*
Incorporated by reference to Exhibit 10-19 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 28,
2008.
Incorporated by reference to Exhibit 10-25 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 30,
2016.
TEGNA Inc. 2015 Change in Control Severance Plan, as
amended through May 30, 2017.*
Incorporated by reference to Exhibit 10-8 to TEGNA Inc.'s
Form 10-Q for the fiscal quarter ended June 30, 2017.
Amendment No. 1 to the TEGNA Inc. 2015 Change in
Control Severance Plan, as amended through May 30,
2017.*
Incorporated by reference to Exhibit 10-27-2 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2018.
84
Exhibit Number
Exhibit
Location
10-20
10-20-1
10-21
10-22
10-23
TEGNA Inc. Executive Severance Plan, as amended
through May 30, 2017.*
Incorporated by reference to Exhibit 10-9 to TEGNA Inc.'s
Form 10-Q for the fiscal quarter ended June 30, 2017.
Amendment No. 1 to the TEGNA Inc. Executive Severance
Plan, as amended through May 30, 2017.*
Incorporated by reference to Exhibit 10-28-2 to TEGNA
Inc.’s Form 10-K for the fiscal year ended December 31,
2018.
Offer Letter between TEGNA Inc. and David T. Lougee,
dated as of May 3, 2017.*
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.'s
Form 8-K filed on May 9, 2017.
Letter Agreement between TEGNA Inc. and Victoria D.
Harker, dated as of May 4, 2017.*
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.'s
Form 8-K filed on May 9, 2017.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 29,
2013.
Amendment and Restatement Agreement, dated as of
August 5, 2013, to each of (i) the Amended and Restated
Competitive Advance and Revolving Credit Agreement,
dated as of March 11, 2002 and effective as of March 18,
2002, as amended and restated as of December 13, 2004
and effective as of January 5, 2005, as amended by the
First Amendment thereto, dated as of February 28, 2007
and effective as of March 15, 2007, as further amended by
the Second Amendment thereto, dated as of October 23,
2008 and effective as of October 31, 2008, as further
amended by the Third Amendment thereto, dated as of
September 28, 2009, as further amended by the Fourth
Amendment thereto, dated as of August 25, 2010 and as
further amended by the Fifth Amendment and Waiver,
dated as of September 30, 2010 (the “2002 Credit
Agreement”), among TEGNA Inc., the several banks and
other financial institutions from time to time parties to the
Credit Agreement (the “2002 Lenders”), JPMorgan Chase
Bank, N.A., as administrative agent (in such capacity, the
“2002 Administrative Agent”), JPMorgan Chase Bank, N.A.
and Citibank, N.A., as syndication agents, and Barclays
Bank PLC, as documentation agent, (ii) the Competitive
Advance and Revolving Credit Agreement, dated as of
February 27, 2004 and effective as of March 15, 2004, as
amended by the First Amendment thereto, dated as of
February 28, 2007 and effective as of March 15, 2007, as
further amended by the Second Amendment thereto, dated
as of October 23, 2008 and effective as of October 31,
2008, as further amended by the Third Amendment thereto,
dated as of September 28, 2009, as further amended by
the Fourth Amendment thereto, dated as of August 25,
2010, and as further amended by the Fifth Amendment and
Waiver, dated as of September 30, 2010 (the “2004 Credit
Agreement”), among TEGNA Inc., the several banks and
other financial institutions from time to time parties to the
Credit Agreement (the “2004 Lenders”), JPMorgan Chase
Bank, N.A., as administrative agent (in such capacity, the
“Administrative Agent”), JPMorgan Chase Bank, N.A. and
Citibank, N.A., as syndication agents, and Barclays Bank
PLC and SunTrust Bank, as documentation agents and (iii)
the Competitive Advance and Revolving Credit Agreement,
dated as of December 13, 2004 and effective as of January
5, 2005, as amended by the First Amendment thereto,
dated as of February 28, 2007 and effective as of March
15, 2007, as further amended by the Second Amendment
thereto, dated as of October 23, 2008 and effective as of
October 31, 2008, as further amended by the Third
Amendment thereto, dated as of September 28, 2009, as
further amended by the Fourth Amendment thereto, dated
as of August 25, 2010 and as further amended by the Fifth
Amendment and Waiver, dated as of September 30, 2010
(the “2005 Credit Agreement” and, together with the 2002
Credit Agreement and the 2004 Credit Agreement, the
“Credit Agreements”), among TEGNA Inc., the several
banks and other financial institutions from time to time
parties to the Credit Agreement (the “2005 Lenders” and,
together with the 2002 Lenders and the 2004 Lenders, the
“Lenders”), JPMorgan Chase Bank, N.A., as administrative
agent (in such capacity, the “2005 Administrative Agent”
and, together with the 2002 Administrative Agent and the
2004 Administrative Agent, the “Administrative Agent”),
JPMorgan Chase Bank, N.A. and Citibank, N.A., as
syndication agents, and Barclays Bank PLC, as
documentation agent, by and between TEGNA Inc., the
Guarantors under the Credit Agreements as of August 5,
2013, the Administrative Agent, JPMorgan Chase Bank,
N.A. and Bank of America, N.A., as issuing lenders and the
Lenders party thereto.
85
Exhibit Number
Exhibit
Location
10-23-1
10-23-2
10-23-3
10-23-4
10-23-5
10-23-6
10-23-7
Master Assignment and Assumption, dated as of August 5,
2013, by and between each of the lenders listed thereon as
assignors and/or assignees.
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 29,
2013.
Incorporated by reference to Exhibit 10-3 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 29,
2013.
Incorporated by reference to Exhibit 10-4 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 29,
2013.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 29, 2015.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 28, 2015.
Incorporated by reference to Exhibit 10-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 30,
2016.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 30,
2017.
Amended and Restated Competitive Advance and
Revolving Credit Agreement, dated as of August 5, 2013,
by and among TEGNA Inc., the several banks and other
financial institutions from time to time parties thereto,
JPMorgan Chase Bank, N.A., as administrative agent, and
JPMorgan Chase Bank, N.A. and Citibank, N.A. as
syndication agents.
Sixth Amendment, dated as of September 24, 2013, to the
Competitive Advance and Revolving Credit Agreement,
dated as of December 13, 2004 and effective as of January
5, 2005, as amended by the First Amendment thereto,
dated as of February 28, 2007 and effective as of March
15, 2007, as further amended by the Second Amendment
thereto, dated as of October 23, 2008 and effective as of
October 31, 2008, as further amended by the Third
Amendment thereto, dated as of September 28, 2009, as
further amended by the Fourth Amendment thereto, dated
as of August 25, 2010, as further amended by the Fifth
Amendment and Waiver, dated as of September 30, 2010,
and as further amended and restated pursuant to the
Amended and Restated Competitive Advance and
Revolving Credit Agreement, dated as of August 5, 2013,
by and among TEGNA Inc., JPMorgan Chase Bank, N.A.,
as administrative agent, and the several banks and other
financial institutions from time to time parties thereto.
Seventh Amendment, dated as of February 13, 2015, to the
Competitive Advance and Revolving Credit Agreement,
dated as of December 13, 2004 and effective as of January
5, 2005, as amended and restated as of August 5, 2013
and as further amended by the Sixth Amendment thereto,
dated as of September 24, 2013, among TEGNA Inc.,
JPMorgan Chase Bank, N.A., as administrative agent, and
the several banks and other financial institutions from time
to time parties.
Eighth Amendment, dated as of June 29, 2015, to the
Amended and Restated Competitive Advance and
Revolving Credit Agreement, dated as of December 13,
2004 and effective as of January 5, 2005, as amended and
restated as of August 5, 2013, and as further amended by
the Seventh Amendment thereto dated as of February 13,
2015, and the Sixth Amendment thereto dated September
24, 2013, among TEGNA Inc., JPMorgan Chase Bank N.A.,
as administrative agent, and the several banks and other
financial institutions from time to time parties thereto, as set
forth on Exhibit A to the Eight Amendment.
Ninth Amendment, dated as of September 30, 2016, to the
Amended and Restated Competitive Advance and
Revolving Credit Agreement, dated as of December 13,
2004 and effective as of January 5, 2005, as amended and
restated as of August 5, 2013, and as further amended by
the Eighth Amendment thereto, dated as of June 29, 2015,
the Seventh Amendment thereto, dated as of February 13,
2015, and the Sixth Amendment thereto, dated as of
September 24, 2013, among TEGNA Inc., JPMorgan
Chase Bank, N.A., as administrative agent, and the several
banks and other financial institutions from time to time
parties thereto, as set forth on Exhibit A, to the Ninth
Amendment.
Tenth Amendment, dated as of August 1, 2017, to the
Amended and Restated Competitive Advance and
Revolving Credit Agreement, dated as of December 13,
2004 and effective as of January 5, 2005, as amended and
restated as of August 5, 2013, and as further amended,
among TEGNA Inc., JPMorgan Chase Bank, N.A. as
administrative agent, and the several banks and other
financial institutions from time to time parties thereto.
86
Exhibit Number
Exhibit
Location
10-23-8
10-23-9
10-23-10
10-24
10-24-1
10-24-2
10-24-3
10-25
10-26
10-27
10-28
Eleventh Amendment, dated as of June 21, 2018, to the
Amended and Restated Competitive Advance and
Revolving Credit Agreement, dated as of December 13,
2004 and effective as of January 5, 2005, as amended and
restated as of August 5, 2013, as further amended as of
June 29, 2015, as further amended as of August 1, 2017,
among TEGNA Inc., JPMorgan Chase Bank, N.A. as
administrative agent, and the several banks and other
financial institutions from time to time parties thereto.
Twelfth Amendment, dated as of August 15, 2019, to the
Amended and Restated Competitive Advance and
Revolving Credit Agreement, dated as of December 13,
2004 and effective as of January 5, 2015, as amended and
restated as of August 5, 2013, as further amended as of
June 29, 2015, as further amended as of August 1, 2017,
and as further amended as of June 21, 2018, among
TEGNA Inc., JPMorgan Chase Bank, N.A. as
administrative agent, and the several banks and other
financial institutions from time to time parties thereto.
Thirteenth Amendment, dated as of June 11, 2020, to the
Amended and Restated Competitive Advance and
Revolving Credit Agreement, dated as of December 13,
2004 and effective as of January 5, 2005, and as amended
and restated as of August 5, 2013, as further amended as
of June 29, 2015, as further amended as of September 30,
2016, as further amended as of August 1, 2017, as further
amended as of June 21, 2018 and as further amended as
of August 15, 2019, among TEGNA Inc., JPMorgan Chase
Bank, N.A., as administrative agent, and the several banks
and other financial institutions from time to time parties
thereto.
Increased Facility Activation Notice, dated September 25,
2013, pursuant to the Amended and Restated Competitive
Advance and Revolving Credit Agreement, dated as of
August 5, 2013, by and among TEGNA Inc., JPMorgan
Chase Bank N.A., as administrative agent, and the several
banks and other financial institutions from time to time
parties thereto.
Increased Facility Activation Notice, dated May 5, 2014,
pursuant to the Amended and Restated Competitive
Advance and Revolving Credit Agreement, dated as of
August 5, 2013, by and among TEGNA Inc., JP Morgan
Chase Bank, N.A., as administrative agent, and the several
banks and other financial institutions from time to time
parties thereto.
Increased Facility Activation Notice, dated as of September
23, 2015, pursuant to the Amended and Restated
Competitive Advance and Revolving Credit Agreement,
dated as of August 5, 2013, as amended, by and among
TEGNA Inc., JPMorgan Chase Bank N.A., as
administrative agent, and the several banks and other
financial institutions from time to time parties thereto.
Increased Facility Activation Notice, dated as of September
26, 2016, pursuant to the Amended and Restated
Competitive Advance and Revolving Credit Agreement,
dated as of August 5, 2013, as amended, by and among
TEGNA Inc., JPMorgan Chase Bank N.A., as
administrative agent, and the several banks and other
financial institutions from time to time parties thereto.
Asset Purchase Agreement, dated as of March 20, 2019,
by and among Nexstar Media Group, Inc., Belo Holdings,
Inc. and TEGNA Inc.
Agreement and Plan of Merger, dated as of June 10, 2019,
by and among RadiOhio Incorporated, Radio Acquisition
Corp., TEGNA Inc., and Michael J. Fiorile, solely in his
capacity as Stockholder Representative.
Stock Purchase Agreement, dated as of June 10, 2019, by
and among VideoIndiana, Inc., the Sellers named therein,
Michael J. Fiorile, solely in his capacity as Stockholder
Representative, and TEGNA Inc.
Stock Purchase Agreement, dated as of June 10, 2019, by
and among WBNS TV, Inc., the Sellers named therein,
Michael J. Fiorile, solely in his capacity as Stockholder
Representative, and TEGNA Inc.
87
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2018.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 30,
2019.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 8-K filed on June 12, 2020.
Incorporated by reference to Exhibit 10-5 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 29,
2013.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 29, 2014.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 27,
2015.
Incorporated by reference to Exhibit 10-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended September 30,
2016.
Incorporated by reference to Exhibit 2-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended March 31, 2019.
Incorporated by reference to Exhibit 2-1 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2019.
Incorporated by reference to Exhibit 2-2 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2019.
Incorporated by reference to Exhibit 2-3 to TEGNA Inc.’s
Form 10-Q for the fiscal quarter ended June 30, 2019.
Exhibit Number
Exhibit
21
23.1
23.2
31-1
31-2
32-1
32-2
101.INS
101.SCH
101.CAL
101.DEF
101.LAB
Subsidiaries of TEGNA Inc.
Consent of Independent Registered Public Accounting
Firm.
Consent of Independent Registered Public Accounting
Firm.
Certification Pursuant to Rule 13a-14(a) under the
Securities Exchange Act of 1934.
Certification Pursuant to Rule 13a-14(a) under the
Securities Exchange Act of 1934.
Section 1350 Certification.
Section 1350 Certification.
XBRL Instance Document - the instance document does
not appear in the Interactive Date file because its Inline
XBRL tags are embedded within the Inline XBRL
document.
Location
Attached.
Attached.
Attached.
Attached.
Attached.
Attached.
Attached.
Attached.
Inline XBRL Taxonomy Extension Schema Document.
Attached.
Inline XBRL Taxonomy Extension Calculation Linkbase.
Attached.
Inline XBRL Taxonomy Extension Definition Document.
Attached.
Inline XBRL Taxonomy Extension Label Linkbase
Document.
Attached.
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase.
Attached.
104
Cover Page Interactive Data File (formatted as Inline XBRL
and contained in Exhibit 101).
Attached.
For purposes of the incorporation by reference of documents as Exhibits, all references to Form 10-K, 10-Q and 8-K of TEGNA Inc. refer to Forms 10-K, 10-Q and 8-K
filed with the Commission under Commission file number 1-6961.
We agree to furnish to the Commission, upon request, a copy of each agreement with respect to long-term debt not filed herewith in reliance upon the exemption from
filing applicable to any series of debt which does not exceed 10% of our total consolidated assets.
* Asterisks identify management contracts and compensatory plans arrangements.
88
ITEM 16. FORM 10-K SUMMARY
None.
89
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.
Dated: March 1, 2021
TEGNA Inc. (Registrant)
By:
/s/ Victoria D. Harker
Victoria D. Harker
Executive Vice President and Chief Financial Officer
(principal financial officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant in the capacities and on the dates indicated.
Dated: March 1, 2021
/s/ David T. Lougee
David T. Lougee
President and Chief Executive Officer
(principal executive officer)
Dated: March 1, 2021
/s/ Victoria D. Harker
Victoria D. Harker
Executive Vice President and Chief Financial Officer
(principal financial officer)
Dated: March 1, 2021
/s/ Clifton A. McClelland III
Clifton A. McClelland III
Senior Vice President and Controller
(principal accounting officer)
90
Dated: March 1, 2021
/s/ Gina Bianchini
Gina Bianchini, Director
Dated: March 1, 2021
/s/ Howard D. Elias
Howard D. Elias, Director, Chairman
Dated: March 1, 2021
/s/ Stuart Epstein
Stuart Epstein, Director
Dated: March 1, 2021
/s/ Lidia Fonseca
Lidia Fonseca, Director
Dated: March 1, 2021
/s/ Karen Grimes
Karen Grimes, Director
Dated: March 1, 2021
/s/ David T. Lougee
David T. Lougee, Director
Dated: March 1, 2021
/s/ Scott K. McCune
Scott K. McCune, Director
Dated: March 1, 2021
/s/ Henry W. McGee
Henry W. McGee, Director
Dated: March 1, 2021
/s/ Susan Ness
Susan Ness, Director
Dated: March 1, 2021
/s/ Bruce P. Nolop
Bruce P. Nolop, Director
Dated: March 1, 2021
/s/ Neal Shapiro
Neal Shapiro, Director
Dated: March 1, 2021
/s/ Melinda C. Witmer
Melinda C. Witmer, Director
91
GLOSSARY OF FINANCIAL TERMS
Presented below are definitions of certain key financial and operational terms that we hope will enhance the reading and understanding of our
2020 Form 10-K.
ADJUSTED EBITDA – Net income attributable to TEGNA before (1) net loss attributable to redeemable noncontrolling interest, (2) income taxes,
(3) interest expense, (4) equity income in unconsolidated investments, net, (5) other non-operating items, net, (6) workforce restructuring, (7)
M&A due diligence costs, (8) acquisition-related costs, (9) advisory fees related to activism defense, (10) spectrum repacking reimbursements
and other, net, (11) depreciation and (12) amortization.
AMORTIZATION – A non-cash charge against our earnings that represents the write off of intangible assets over the projected life of the assets.
BALANCE SHEET – A summary statement that reflects our assets, liabilities and equity at a particular point in time.
BUSINESS ACQUISITION – The acquiring company records the assets and liabilities assumed from the business being acquired at their fair
value, with any excess of the purchase price over such fair value recorded to goodwill. If the purchase price is less than the fair value of the
assets and liabilities acquired, the difference is recognized as a bargain purchase.
CURRENT ASSETS – Cash and other assets that are expected to be converted to cash within one year.
CURRENT LIABILITIES – Amounts owed that will be paid within one year.
DEPRECIATION – A non-cash charge against our earnings that allocates the cost of property and equipment over the estimated useful lives of
the assets.
DIVIDEND – A payment we make to our shareholders from a portion of our earnings.
EARNINGS PER SHARE (basic) – Our earnings divided by the average number of shares outstanding for the period.
EARNINGS PER SHARE (diluted) - Our earnings divided by the average number of shares outstanding for the period, giving effect to assumed
dilution from outstanding performance share awards and restricted stock units.
EQUITY EARNINGS FROM INVESTMENTS – For those investments in which we have the ability to exercise significant influence, but do not
have control, an income or loss entry is recorded in the Consolidated Statements of Income representing our ownership share of the operating
results of the investee company.
FREE CASH FLOW – Is calculated as Adjusted EBITDA (as defined above), further adjusted by adding back (1) stock-based compensation, (2)
non-cash 401(k) company match, (3) syndicated programming amortization, (4) pension reimbursements, (5) dividends received from equity
method investments and (6) reimbursements from spectrum repacking. This is further adjusted by deducting payments made for (1) syndicated
programming, (2) pension, (3) interest, (4) taxes (net of refunds) and (5) purchases of property and equipment.
GAAP – Generally accepted accounting principles in the United States.
GOODWILL – In a business purchase, this represents the excess of amounts paid over the fair value of tangible and other identified intangible
assets acquired net of liabilities assumed.
NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS – The portion of equity and net earnings in consolidated subsidiaries that
is owned by others.
OVER THE TOP (OTT) SERVICES – A service that delivers video content to consumers over the Internet.
PERFORMANCE SHARE AWARD – An equity award that gives key employees the right to earn a number of shares of common stock over an
incentive period based on how our actual adjusted EBITDA and free cash flow (as defined by the PSA agreement) performs as compared to
targets.
PERFORMANCE SHARE UNIT – An equity award that gives key employees the right to earn a number of shares of common stock over an
incentive period based on how our total shareholder return (TSR) compares to the TSR of a representative peer group of companies.
RESTRICTED STOCK – An award that gives key employees the right to shares of our stock, pursuant to a vesting schedule.
RETAINED EARNINGS – Our earnings not paid out as dividends to shareholders.
STATEMENT OF CASH FLOWS – A financial statement that reflects cash flows from operating, investing and financing activities, providing a
comprehensive view of changes in our cash and cash equivalents.
STATEMENT OF COMPREHENSIVE INCOME – A financial statement that reflects our changes in equity (net assets) from transactions and
other events from non-owner sources. Comprehensive income comprises net income and other items reported directly in shareholders’ equity,
principally funded status of postretirement plans and the foreign currency translation adjustment.
STATEMENT OF EQUITY – A financial statement that reflects changes in our common stock, retained earnings and other equity accounts.
STATEMENT OF INCOME – A financial statement that reflects our profit by measuring revenues and expenses.
STOCK-BASED COMPENSATION – The payment to employees for services received with equity instruments such as restricted stock units and
performance share awards.
VARIABLE INTEREST ENTITY (VIE) – A variable interest entity is an entity that lacks equity investors or whose equity investors do not have a
controlling interest in the entity through their equity investments.
92
Comparison of shareholder return – 2016 to 2020
The following graph compares the performance of our common stock during the period December 31, 2015, to December 31,
2020, with the S&P 500 Index, and a peer group indice we selected.
Our 2020 peer group includes E.W. Scripps Company, Gray Television Inc., Meredith Corp., Nexstar Media Group, Inc., and
Sinclair Broadcast Group, Inc (collectively, the Peer Group). The Peer Group includes the largest publicly traded pure-play and
diversified television broadcasting companies with meaningful television station assets and broadcast exposure. No such
company of relevant scale is excluded from the Peer Group, except for the television networks, which are part of much larger
entities in which television stations are a relatively small part of the aggregate enterprise.
The S&P 500 Index includes 500 U.S. companies in the industrial, utilities and financial sectors and is weighted by market
capitalization. The total returns of each peer group index also are weighted by market capitalization.
The graph depicts representative results of investing $100 in our common stock, the S&P 500 Index, the Peer Group index as
of closing on December 31, 2015. It assumes that dividends were reinvested monthly with respect to our common stock
(including, as it relates to the Cars.com spin-off, the aggregate value of the former digital automotive marketplace business as
distributed to our shareholders), daily with respect to the S&P 500 Index and monthly with respect to the Peer Group company.
From January 1, 2016 to mid-2017, our portfolio of companies included large broadcast and digital assets. Specifically, this
period of time included our former digital segment which included Cars.com and CareerBuilder. As a result of continued
execution of our five-pillar strategy, we have generated total shareholder return of 5.5% from January 1, 2018 (the beginning of
our first full year as a pure-play broadcasting company) through December 31, 2020, compared to a median total shareholder
return of 2.3% for our Peer Group.
Company Name / Index
TEGNA Inc.
S&P 500 Index
Peer Group
2015
100
100
100
2016
$85.87
$111.96
$108.25
2017
$91.92
$136.40
$124.67
2018
$72.65
$130.42
$108.56
2019
$113.60
$171.49
$132.10
2020
$96.96
$203.04
$120.00
INDEXED RETURNS
Years Ending
93
Comparison of Cumulative Five Year Total ReturnTEGNA Inc.S&P 500 IndexPeer Group201520162017201820192020$60$80$100$120$140$160$180$200$220 Shareholder Services
TEGNA STOCK
TEGNA Inc. shares are traded on the New York Stock
Exchange under the symbol TGNA. The Company’s
transfer agent and registrar is Computershare. General
inquiries and requests for enrollment materials for the
programs described below should be directed to
Computershare, P.O. Box 505000, Louisville, KY 40233-
5000 or by telephone at 1-800-778-3299 or at
www.computershare.com/investor.
DIRECT STOCK PURCHASE PLAN
The CIP Direct Stock Purchase Plan provides TEGNA
shareholders the opportunity to purchase additional
shares of the Company’s common stock through automatic
reinvestment of dividends and optional cash payments.
The minimum cash purchase amount is $10, subject to a
maximum aggregate annual amount of $250,000.
AUTOMATIC CASH INVESTMENT SERVICE FOR THE CIP
This plan provides a convenient method of having money
automatically withdrawn from your checking or savings
account each month and invested in TEGNA stock through
your CIP account.
DIRECT DEPOSIT SERVICE
TEGNA shareholders may have their quarterly dividends
electronically credited to their checking or savings
accounts on the payment date at no additional cost.
Committees of our Board of Directors, and we intend to
post updates to these corporate governance materials
promptly if any changes (including through any amendments
or waivers of the ethics policy) are made. This site also
provides access to our annual report on Form 10-K,
quarterly reports on Form 10-Q and current reports on
Form 8-K as filed with the SEC. Our chief executive officer
and our chief financial officer have delivered, and we have
filed with our 2020 Form 10-K, all certifications required by
the rules of the SEC. Complete copies of our corporate
governance materials and our Form 10-K may be obtained
by writing our secretary at our corporate headquarters. In
accordance with the rules of the New York Stock Exchange,
our chief executive officer has certified, without qualification,
that such officer is not aware of any violation by TEGNA of
the NYSE’s corporate governance listing standards.
FOR MORE INFORMATION
News and information about TEGNA is available on our
website. Quarterly earnings information will be available in
May, August and November 2021. Shareholders who wish
to contact the Company directly about their TEGNA stock
should call Shareholder Services at TEGNA headquarters,
703-873-6677.
TEGNA HEADQUARTERS
8350 Broad Street, Suite 2000, Tysons, VA 22102
703-873-6600
CORPORATE GOVERNANCE
We have posted on the Corporate Governance page under
the “Investors” menu of our website (www.tegna.com), our
principles of corporate governance, ethics policy, related
person transaction policy and the charters for the Audit,
Leadership Development and Compensation, Nominating
and Governance and Public Policy and Regulation
This report was printed using soy-based inks. The paper
used in this report was purchased from Verso and Finch,
two leading American paper companies supporting
responsible forest management and carrying chain of
custody certifications. The cover and
narrative section also include 10% total
recovered fiber/all post-consumer waste.
2020 Annual Report 9
TEGNA Inc. | 8350 Broad St., Suite 2000 | Tysons, VA 22102 | www.TEGNA.com
10 TEGNA