Graham Holdings Company Reports First Quarter Earnings
ARLINGTON, Va. , May 01 /Businesswire/ - Graham Holdings Company (NYSE: GHC) today reported its financial results for the first quarter of 2024. The Company also filed its Form 10-Q today for the quarter ended March 31, 2024 with the Securities and Exchange Commission.
Division Operating Results
Revenue for the first quarter of 2024 was $1,152.7 million, up 12% from $1,031.5 million in the first quarter of 2023. Revenues increased at education, healthcare and automotive, partially offset by declines at manufacturing and other businesses. The Company reported operating income of $35.4 million for the first quarter of 2024, compared to $27.7 million for the first quarter of 2023. The improvement in operating results is due to increases at education, television broadcasting and healthcare, and reduced losses at other businesses, partially offset by declines at manufacturing and automotive. The Company reported adjusted operating cash flow (non-GAAP) for 2024 of $82.8 million for the first quarter of 2024, compared to $71.6 million for the first quarter of 2023. Adjusted operating cash flow improved at education, television broadcasting, healthcare and other businesses, partially offset by declines at manufacturing and automotive. Capital expenditures totaled $21.5 million and $22.3 million for the first quarter of 2024 and 2023, respectively.
Acquisitions and Dispositions of Businesses
There were no significant business acquisitions or dispositions during the first quarter of 2024.
Debt, Cash and Marketable Equity Securities
At March 31, 2024, the Company had $815.6 million in borrowings outstanding at an average interest rate of 6.4%, including $108.1 million outstanding on its $300 million revolving credit facility. Cash, marketable equity securities and other investments totaled $981.9 million at March 31, 2024.
Overall, the Company recognized $104.2 million and $18.0 million in net gains on marketable equity securities in the first quarter of 2024 and 2023, respectively.
Common Stock Repurchases
During the first quarter of 2024, the Company purchased a total of 28,606 shares of its Class B common stock at a cost of $20.0 million. At March 31, 2024, there were 4,450,593 shares outstanding. On May 4, 2023, the Board of Directors authorized the Company to acquire up to 500,000 shares of its Class B common stock; the Company has remaining authorization for 207,797 shares as of March 31, 2024.
Overall Company Results
The Company reported net income attributable to common shares of $124.4 million ($27.72 per share) for the first quarter of 2024, compared to $52.3 million ($10.88 per share) for the first quarter of 2023.
The results for the first quarter of 2024 and 2023 were affected by a number of items as described in the Non-GAAP Financial Information schedule attached to this release. Excluding these items, net income attributable to common shares was $50.4 million ($11.24 per share) for the first quarter of 2024, compared to $40.2 million ($8.36 per share) for the first quarter of 2023.
* * * * * * * * * * * *
Forward-Looking Statements
All public statements made by the Company and its representatives that are not statements of historical fact, including certain statements in this press release, in the Company’s Annual Report on Form 10-K and in the Company’s 2023 Annual Report to Stockholders, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts, and assumptions by the Company’s management and involve a number of risks, uncertainties, and other factors that could cause actual results to differ from those stated, including, without limitation, comments about expectations related to acquisitions or dispositions or related business activities, the Company’s business strategies and objectives, the prospects for growth in the Company’s various business operations, the Company’s future financial performance, and the risks and uncertainties described in Item 1A of the Company’s Annual Report on Form 10-K. Accordingly, undue reliance should not be placed on any forward-looking statement made by or on behalf of the Company. The Company assumes no obligation to update any forward-looking statement after the date on which such statement is made, even if new information subsequently becomes available.
GRAHAM HOLDINGS COMPANY |
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CONSOLIDATED STATEMENTS OF OPERATIONS |
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||||||||||
(Unaudited) |
|
||||||||||
|
|
|
|||||||||
|
Three Months Ended |
|
|||||||||
|
March 31 |
% |
|||||||||
(in thousands, except per share amounts) |
2024 |
|
2023 |
Change |
|||||||
Operating revenues |
$ |
1,152,662 |
|
|
$ |
1,031,546 |
|
12 |
|
||
Operating expenses |
|
1,083,942 |
|
|
|
969,176 |
|
12 |
|
||
Depreciation of property, plant and equipment |
|
22,527 |
|
|
|
20,025 |
|
12 |
|
||
Amortization of intangible assets |
|
10,751 |
|
|
|
13,944 |
|
(23 |
) |
||
Impairment of long-lived assets |
|
— |
|
|
|
745 |
|
— |
|
||
Operating income |
|
35,442 |
|
|
|
27,656 |
|
28 |
|
||
Equity in earnings of affiliates, net |
|
2,331 |
|
|
|
4,661 |
|
(50 |
) |
||
Interest income |
|
2,178 |
|
|
|
1,204 |
|
81 |
|
||
Interest expense |
|
(19,328 |
) |
|
|
(14,294 |
) |
35 |
|
||
Non-operating pension and postretirement benefit income, net |
|
42,417 |
|
|
|
31,845 |
|
33 |
|
||
Gain on marketable equity securities, net |
|
104,152 |
|
|
|
18,022 |
|
— |
|
||
Other income, net |
|
1,647 |
|
|
|
3,083 |
|
(47 |
) |
||
Income before income taxes |
|
168,839 |
|
|
|
72,177 |
|
— |
|
||
Provision for income taxes |
|
43,500 |
|
|
|
19,200 |
|
— |
|
||
Net income |
|
125,339 |
|
|
|
52,977 |
|
— |
|
||
Net income attributable to noncontrolling interests |
|
(959 |
) |
|
|
(705 |
) |
36 |
|
||
Net Income Attributable to Graham Holdings Company Common Stockholders |
$ |
124,380 |
|
|
$ |
52,272 |
|
— |
|
||
Per Share Information Attributable to Graham Holdings Company Common Stockholders |
|
|
|
|
|||||||
Basic net income per common share |
$ |
27.87 |
|
|
$ |
10.91 |
|
— |
|
||
Basic average number of common shares outstanding |
|
4,432 |
|
|
|
4,759 |
|
|
|||
Diluted net income per common share |
$ |
27.72 |
|
|
$ |
10.88 |
|
— |
|
||
Diluted average number of common shares outstanding |
|
4,457 |
|
|
|
4,776 |
|
|
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GRAHAM HOLDINGS COMPANY |
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BUSINESS DIVISION INFORMATION |
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(Unaudited) |
|||||||||||
|
|
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|
|
|
|
|||||
|
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Three Months Ended |
|
|
|||||||
|
|
March 31 |
|
% |
|||||||
(in thousands) |
2024 |
|
2023 |
|
Change |
||||||
Operating Revenues |
|
|
|
|
|
||||||
Education |
|
$ |
422,598 |
|
|
$ |
378,041 |
|
|
12 |
|
Television broadcasting |
|
|
113,058 |
|
|
|
112,877 |
|
|
0 |
|
Manufacturing |
|
|
101,903 |
|
|
|
114,584 |
|
|
(11 |
) |
Healthcare |
|
|
128,201 |
|
|
|
102,059 |
|
|
26 |
|
Automotive |
|
|
303,840 |
|
|
|
232,561 |
|
|
31 |
|
Other businesses |
|
|
83,298 |
|
|
|
92,008 |
|
|
(9 |
) |
Corporate office |
|
|
576 |
|
|
|
— |
|
|
— |
|
Intersegment elimination |
|
|
(812 |
) |
|
|
(584 |
) |
|
— |
|
|
|
$ |
1,152,662 |
|
|
$ |
1,031,546 |
|
|
12 |
|
Operating Expenses |
|
|
|
|
|
||||||
Education |
|
$ |
392,011 |
|
|
$ |
355,001 |
|
|
10 |
|
Television broadcasting |
|
|
83,425 |
|
|
|
84,294 |
|
|
(1 |
) |
Manufacturing |
|
|
98,834 |
|
|
|
107,256 |
|
|
(8 |
) |
Healthcare |
|
|
122,110 |
|
|
|
99,123 |
|
United States, North America, Other Retail, Aftermarket, Automotive, Other Education, Specialty, General Automotive, Education, Retail, Earnings, Virginia,
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